10th June 2011

Fund Manager :Vinay Paharia

Managing the fund since : Dec 2008

Benchmark : CNX Midcap

Fund Strategy

Religare MidCap Fund is being consistently managed with the following characteristics:

• Pure MidCap: Investing true to mandate only in MidCap stocks (stocks with a market capitalization less than smallest stock of Nifty), form more than 85% of the invested portfolio

• Blend of Value-Growth: Portfolio invested in both high growth companies as well as value companies.

• Diversified portfolio: Portfolio of more than 50 stocks with no stock having weightage more than 5%.

• Active Management: Rigorous sell discipline, with sell decision dependent on the categorization of the stocks.

• No Asset Allocation: Do not take active cash calls with cash normally not exceeding 10% of portfolio.

• Bottom up stock picking: Large differences with the benchmark sector allocation as investments are purely on each company's investment merit

Fund Performance

Ever since this fund came into the Religare fold in end 2008 and the new fund manager took charge in Dec 2008, the fund's performance has been very sound. It has created a good track record of outperforming its benchmark over the long and medium term time horizons, as can be seen from the numbers below :

Sectoral and thematic preferences

Currently we have invested in a healthy mix of companies on both the Growth as well as Value Platforms. Recently we have increased the weightages of mature but relatively fast growth companies, as many of them are available at attractive valuations in relation to their intrinsic value.

The portfolio is currently overweight Consumer sector, both staples and discretionary. We feel stocks in this sector present opportunity to play the structural growth in demand across different categories.

Fund manager's outlook

Our outlook for Indian Midcaps continues to remain bullish as we feel this segment of the market provides an interesting investment opportunity for medium term investors, whereby they can benefit not just from earnings growth but also from p/e multiple expansion in the future.