Budget to benefit several sectoral funds
By siliconindia   |   Wednesday, 08 July 2009, 19:02 IST   |    7 Comments
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Budget to benefit several sectoral funds
Bangalore: Though, many may argue that except infrastructure, there were less sector-specific sops that the Union Budget had in store, there are some sectoral mutual funds (MF) that may actually benefit from the budget. Dhirendra Kumar, CEO of Value Research, a MF research firm explained in Mint that those MFs in sectors like power, oil and natural gas, pharma, infrastructure and auto can look forward to reap the benefits of the budget. With the increased allocation for power sector in the budget, one of the MF that can be a good bet is Reliance Diversified Power Fund. With the hope of reforms in the power sector, this fund was launched in 2004. Though, the reforms did not take place, the fund has not disappointed. For the past five years, the fund has had an annualized return of 46.31 percent. Some of the key holdings of the Fund are Reliance Infrastructure, Reliance Industries and Jindal Steel and Power. By getting the major chunk of benefits, infrastructure is one of the best sectors to invest in the post-budget market. ICICI Pru Infrastructure fund can be a good choice looking at its track record by being the best performer in the category for 2007 and 2008. Some of the key stocks in its portfolio include Reliance Industries, Bharti Airtel and HDFC Bank. With more investments expected in infrastructure, the auto industry - which UTI Transportation and Logistics fund invests in - can also be a beneficiary of the budget. With Bajaj Auto, Hero Honda and Mahindra and Mahindra in its portfolio, the fund can look forward to some good returns in the future. IDFC Imperial Equity Fund is a fund that focuses on Oil and Natural Gas sector, which has got enhanced and rationalized tax benefits in the budget. Some of the key holdings of this fund are ONGC, GAIL and IOCL. With the cut in custom duty on major drugs, Franklin Pharma fund that invests in the pharma sector can be a good option. The fund has 21 stocks in its portfolio that includes Lupin, Cadila Healthcare and Dr. Reddy's Laboratories.

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