Equity bull run continues, debt schemes lacklustre: CRISIL~RRR

CRISIL FundServices, in its monthly Risk Adjusted Return Ranking (CRISIL~RRR) of the performance of mutual fund schemes, has covered twelve mutual fund investment options and has ranked 243 schemes for the one-year period ended April 2006. The ranking covers 52 per cent of mutual funds industry assets under management (AuM). The CRISIL~RRR measures performance of the schemes not only on the returns given by the schemes over the period of analysis but also the risk they took to get those returns.

The Indian equity market continued its three-year bull run through April 2006 wherein the BSE Sensex breached the 12000 barrier to close the month at 12043 points while the S&P CNX Nifty closed at 3557 points. The S&P CNX Nifty delivered returns of 4.56 per cent while the CNX Midcap Index delivered 9.86 per cent during April 2006.

Mutual Funds replaced FIIs as the market movers during the month with net investments aggregating Rs3,121 crore compared to Rs538 crore in net investment from FIIs. In the previous month, FIIs were net buyers to the extent of Rs6,532 crore in equities while mutual funds were net buyers to the extent of Rs4,483 crore.

The money market came out of its tightness as liquidity improved during the month. Overnight rates dropped from 6.43 per cent at the beginning of the month and remained around the reverse repo rate (5.5 per cent) during most of the month to close at 5.68 per cent. The RBI's Annual Policy Statement for FY07 also indicated no rate hike, contrary to market expectations.

The Equity Funds category benchmark, the CRISIL Fund~eX, generated a return of 80.17 per cent for the year-ended April 2006. Sundaram Select Midcap - Growth continued to top the category at CRISIL~RRR 1. DSP Merrill Lynch India T.I.G.E.R. Fund - Growth moved up by one notch to CRISIL~RRR 2 while Franklin India Flexi Cap Fund - Growth moved up by three notches to CRISIL~RRR 3.

In the equity linked savings scheme (ELSS) category: