India Capital Growth reports that, despite Indian markets enduring a shaky start to the year in lockstep with equity volatility globally, its portfolio performance has remained robust, with the net asset value per share rising 17.2%, as compared with the notional benchmark’s performance of 14.9% over the six months ended 30 June 2016. the 17.2% return is an undiluted number the fund’s subscription shares, which were all exercised in August – expanding the fund by £22.9m, had the effect of reducing the actual NAV return to 12.5%. India underperformed the broader emerging market asset class. Thus MSCI Emerging Markets rose 5% compared to MSCI India which was up 0.4% (both measured in US Dollars), as the perception of India remains affected by relative valuation and weak corporate earnings.
The manager says that many stocks in the portfolio contributed to performance, including Yes Bank (5.2% weight) up 54%, The Ramco Cements (3.5% weight) up 43%, Finolex Cables (3.2% weight) up 44%, Essel Propack (2.4% weight) up 49% and Kajaria Ceramics (4.5% weight) up 23%. Among the negative contributors were Mahindra CIE (1.7% weight) down 29%, Dewan Housing (3.7% weight) down 12% and Lupin (1.9% weight) down 16%. The outperformance stemmed mainly from stock selection in Industrials, Financials and Materials whilst negative attribution came from the underweight position in Energy and stock selection in Consumer Discretionary.
IGC : India Capital Growth’s portfolio outperforms