HDFC Growth Fund may have been a relatively late entrant in the market. But the fund house's conservative fund management style and group integrity has seen the fund generate goodwill amongst investors. We have done a little study to determine the fund's favourite picks.

As on May 31, 2002, HDFC Growth Fund's (HGF) net assets amounted to Rs 1.2 bn. Over the last year, the fund's NAV(net asset value) appreciated by 12% (absolute). Below, we have analysed the fund's portfolio over the past 5 months to understand the fund manager's investment strategy.

(Visitors need to note that increase/decrease in the stock allocations could be due to change in valuations or due to buying/selling in the stock. Our study does not try to ascertain the reason for the increase/decrease. It only serves to show investors how consistent the fund has been with its stock selection.)

Pursuing a long-term investment strategy

COMPANY	MAY 02	APR 02	MAR 02	FEB 02	JAN 02
ACC	1.2%	1.2%	1.8%	1.7%	-
ASIAN PAINTS (INDIA)	4.2%	4.4%	4.6%	4.2%	-
BHARAT ELECTRONICS	2.1%	2.3%	2.1%	3.5%	-
BHEL	3.1%	3.2%	3.4%	-	-
BHARTI TELEVENTURES	0.7%	0.7%	-	-	-
BPCL	7.7%	8.3%	9.8%	7.7%	6.1%
CIPLA	1.6%	1.6%	1.6%	1.6%	1.9%
CLARIANT INDIA	-	-	-	-	0.9%
CONTAINER CORP	4.6%	4.7%	4.0%	4.1%	3.7%
CORPORATION BANK	1.3%	1.5%	1.5%	1.6%	-
DR. REDDYS LABS	1.8%	-	-	-	-
E. MERCK (INDIA)	1.2%	1.3%	-	-	-
GLAXO INDIA	2.1%	-	-	-	-
GRASIM INDUSTRIES	1.3%	1.2%	1.3%	-	-
GUJARAT GAS	4.0%	4.2%	3.8%	3.5%	0.8%
HERO HONDA	7.9%	8.2%	8.2%	8.6%	-
HIMATSINGKA SEIDE	0.8%	0.7%	-	-	-
HINDALCO	1.4%	1.4%	-	2.9%	3.1%
HINDUSTAN LEVER	4.1%	4.3%	5.0%	5.6%	5.2%
HPCL	1.8%	1.9%	2.0%	2.6%	1.9%
I.T.C.	4.2%	4.1%	4.8%	4.7%	4.6%
INFOSYS	6.8%	7.1%	7.6%	5.1%	4.6%
LARSEN & TOUBRO	-	1.3%	1.5%	-	-
LIC HOUSING FINANCE	0.1%	0.1%	-	-	-
NAVNEET PUB.	-	-	-	-	1.5%
RANBAXY	4.4%	4.6%	4.9%	4.7%	4.3%
SATYAM COMPUTERS	2.1%	0.6%	0.7%	-	-
SBI	3.9%	3.9%	3.9%	3.8%	-
SMITHKLINE BEECHAM	-	-	2.1%	2.0%	3.7%
SWARAJ ENGINES	1.0%	-	1.2%	-	-
SYNDICATE BANK	1.2%	-	-	-	-
TATA ENGINEERING	3.4%	3.5%	3.6%	-	-
TATA POWER CO.	1.2%	1.1%	-	-	1.2%
TISCO	2.7%	2.6%	2.4%	2.3%	2.6%
UNICHEM LABS	-	-	-	-	1.3%

(% denotes stock allocation in relation to net assets)

Clearly, the fund manager has got his money on pharma, cement and auto. Churning the portfolio is obviously not his style, as is evident from the steady allocations month on month. The fund manager seems to have homed in on some choice picks (BPCL, Hero Honda, Infosys, Ranbaxy) and is betting on them to clock growth over the long-term. The fund is pursuing a long-term investment strategy and is not guided by short-term profit booking.

 

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