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Union Budget prompts portfolio churn

Last Updated: Fri, Feb 25, 2011 04:00 hrs

In the face of a volatile market environment ahead of the Budget, and increasing geopolitical tension in West Asia, the S&P CNX 500 benchmark index fell 5.4 per cent. Meanwhile, Smart Portfolios fund managers Shishir Bajpai and Vinay Khattar churned their portfolios actively, while Ajay Parmar continued to remain on the sidelines. The benchmark’s portfolio value is now at Rs 9.26 lakh, down 7.4 per cent since the inception of Smart Portfolios on September 1, 2010. Bajpai’s net worth is valued at Rs 12.23 lakh, an appreciation of 23 per cent, despite all his holdings reflecting negative returns. Parmar’s portfolio value, however, has seen a fall of 9 per cent, while Khattar’s has shown a gain of 4 per cent.

Ajay Parmar has not participated in the markets since January 10. Earlier this month, Parmar said the reason for his sporadic activity was that he wanted to project himself more as an investor, than a trader. He justified his investment in sugar, pharmaceutical and chemical stocks like Shree Renuka Sugars, Balrampur Chini, Torrent Pharma, Aurobindo Pharma, Rallis India and Deepak Fertilisers, saying these sectors had the potential to pick up in the future.

He added he would invest once there was a fair amount of clarity on the fund flow side. However, he said he might sell if panic rose on political reasons. Parmar’s investments across stocks in sectors such as chemicals, fertilisers, sugar, pharmaceuticals and IT has seen a dip of nearly 9 per cent as of on Thursday, at Rs 9.15 lakh, with his holdings worth Rs 6.31 lakh. His portfolio comprises Rs 2.84 in cash.

AJAY PARMAR, Head Research Institutional Equities, Emkay
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
Torrent Pharma 599.00 546.10 0.82
Natco Pharma 291.03 253.00 0.70
eClerx Services 546.00 636.00 0.64
Infinite Comp 181.60 159.00 0.48
Greaves Cotton 83.30 86.25 0.43
Total investments     6.30
Cash      2.84
Net worth     9.14

Shishir Bajpai carried out eleven transactions between February 18 and 24. During the week, Bajpai exited from Jai Balaji Industries, Tata Motors DVR and Tata Steel at an average loss of approximately 2 per cent, of which Cairn India, with a loss of nearly 3 per cent, was the major laggard. Ahead of the Budget on February 28, Bajpai has deployed funds to the tune of Rs 4.52 lakh in stocks like JHS Svendgaard Laboratories. He re-entered Jai Balaji Industries, which he had exited on February 18. He purchased 40 shares of banking heavyweight SBI at Rs 2,762 a share, while about Rs 1.15 lakh was invested in acquiring 250 shares of HCL Technologies. As of on Thursday, his portfolio has appreciated by 23 per cent, with an invested corpus of Rs 12.06 lakh, and a reduced cash component of Rs 0.17 lakh.

SHISHIR BAJPAI, Senior Vice President, IIFL Private Wealth
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
Reliance Ind 1025.98 971.00 1.26
MOIL 458.17 403.00 1.21
Sterlite Ind 181.24 164.90 1.15
Dr Reddy's  1681.15 1533.00 1.15
HCL Techn 459.44 440.00 1.10
Total investments     12.11
Cash      0.17
Net worth     12.28

Vinay Khattar carried out four trades in the past week, two on either side. In a volatile market, Khattar kept a low profile, and managed to book a profit of nearly 3 per cent on his investment in Page Industries. On the other hand, he raised his holdings in fertiliser stock Coromandel International by a margin of 50 shares. Currently, the stock is down 7 per cent from his cost price. He also added Tata Motors DVR into his portfolio by purchasing 50 stocks at Rs 652 each. However, the new entrant from the Tata family shows a drop of 10 per cent at this point. Currently, his portfolio reflects an appreciation of almost 4 per cent at Rs 10.36 lakh. Khattar continues to hold Rs 3.25 in cash, while Rs 7.11 lakh remains invested in stocks like IndusInd Bank, Orchid Chemicals, SBI, Tata Steel and a few others.

VINAY KHATTAR, Head – Research of WAIS, Edelweiss
Top Holdings Cost
price (Rs)
price (Rs)
(Rs lakh)
IndusInd Bank 220.68 224.15 1.01
Tilaknagar Ind 53.55 59.40 0.89
Dish TV India 60.51 57.05 0.71
Havell's India  299.75 320.00 0.64
Orchid Chem 289.31 265.25 0.64
Total investments     7.11
Cash      3.25
Net worth     10.36

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