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First India Tax Gain '97

Dhirendra Kumar

First India Tax Gain '97 is an equity-linked tax-planning scheme due for redemption in March 2006. It is open for repurchase since April 2000. It has not offered any dividends till date. Since inception, it has given an annualised return of 112 per cent, far outperforming the Sensex returns of 14.52 per cent.

For over two years, the fund has been riding the upswing with a portfolio invested in the growth sectors of infotech, pharma and FMCG. Over time, it has hiked its exposure to infotech and pharma to 62 and 19 per cent respectively in March 1999, at the expense of economy and FMCG stocks. Also, the fund has remained concentrated on a small set of scrips.

With the ICE sector at the forefront of market performance last year, the fund reaped a windfall. With a small size to its advantage, the fund has managed to post a whopping return of 217 per cent in the year ending March 2000, taking it to the top of its league. Its ICE exposure, however, has also left its mark of volatility as the recent slide suggests; the fund lost 19 per cent in the one month ending March 2000. For its sectoral concentration, the fund will be a case of high returns with high volatility.

Launched in the bear markets of 1997, the fund started off on an uninspiring note, underperforming the Sensex in its first year. It was often valued below par and also missed the brief rally in 1997. However, it started posting secular gains since April of 1998 and this spree has continued unabated.

Fund Basics
Objective	Size (Rs cr)	NAV (Rs) 13/4/2000	Repurchase Price	Resale Price (Rs)	Total Returns
Tax planning	5.95	91.85	NA	—	111.89%
Benchmark Comparisons (%)					31/3/2000
	1M	3M	6M	1Yr	3Yr
Fund	-11.87	20.97	120.10	217.08	118.60
Sensex	-8.18	-0.09	4.97	33.73	14.17
Nat. Index	-11.88	10.58	31.12	75.74	25.63
Obj.Avg.	-10.88	7.96	38.20	75.32	26.47
Top holdings (31/3/1999)					Net assets (%)
Satyam Computer					18.93
HCL Infosystems					14.61
Mastek					7.66
Hindustan Lever					7.40
Britannia					5.45
VisualSoft					4.78
PSI Data					4.71
Fulford					4.57
NIIT					3.94
E Merck					3.38

Mutual Funds

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