 "FUND PICK: Canara Robeco Emerging Equities Fund")
Canara Robeco Emerging Equities Fund, launched on March 11, 2005, is classified under the small- and mid-cap category of CRISIL Mutual Fund Ranking. It has been ranked in the top 30 percentile over the past seven quarters ended March 2016.
The fund aims to generate capital appreciation by primarily investing in diversified mid-cap stocks. It endeavours to identify the stars of tomorrow within the segment. The fund is managed jointly by Ravi Gopalakrishnan and Krishna Sanghavi. It has quarterly average assets under management (AUM) of Rs 869 crore at the end of March quarter.
Performance
Canara Robeco Emerging Equities Fund has consistently outperformed the category (funds ranked under the small- and mid-cap category in March 2016 CRISIL Mutual Fund Ranking) and the benchmark — Nifty Free Float Midcap 100 —across all time frames under analysis.
Since April 2009 (after the subprime crisis), the fund has outpaced the category and the benchmark across bear and bull market phases. In the post European crisis phase (July 2013-February 2015), the fund generated 72.74 per cent annualised returns, compared with the category's 61.72 per cent (annualised) and the benchmark's 41.51 per cent (annualised). However, during the bull and subprime crisis phases, it underperformed the benchmark and the category.
An investment of Rs 1,000 in the fund on March 11, 2005, (inception day) would have grown to Rs 5,930 (compounded annualised returns of 17.23 per cent) on May 20. A similar investment in the category and the benchmark would have grown to around Rs 6,578 (18.32 per cent) and Rs 4,176 (13.61 per cent), respectively.
Similarly, Rs 1,000 invested per month in the fund since inception via systematic investment plan (SIP) would have grown to Rs 4,20,402 by May 20 at 19.01 per cent annualised returns. In comparison, a similar amount invested in the benchmark would have returned Rs 2,76,231 at 12.17 per cent.
Portfolio analysis
Over three years ended April 29, 2016, the fund had exposure to 185 stocks. It held 61 stocks, on average, indicating a well-diversified portfolio.
In the above period of analysis, the fund has held only eight stocks consistently. Exposure to the consistently held stocks, on average, stands at 13.52 per cent. Among the consistently held stocks, WABCO India had the highest allocation (2.17 per cent) followed by VA Tech Wabag (1.86 per cent) and Century Textile & Industries (1.68 per cent).
As of April 2016, the fund had 64 stocks in its portfolio. IndusInd Bank (3.65 per cent), Indian Oil Corporation (2.89 per cent) and Atul (2.34 per cent) were the top three. As of April 2016, the top five sectors comprised 36.78 per cent of the portfolio.
The highest allocation was to banks (10.62 per cent), followed by construction projects (7.28 per cent), industrial products (6.35 per cent), industrial capital goods (6.27 per cent) and cement (6.26 per cent). On average, the exposure to top five sectors was 41.13 per cent over the past three years.
