A steady outperformer in the hybrid category

Launched in November 1999, the ICICI Prudential Equity & Debt Fund has featured in the top 30 percentile of aggressive hybrid funds of the CRISIL Mutual Fund Ranking (CMFR) for three consecutive quarters through September this year.

The fund has been managed by Sankaran Naren, Mittul Kalawadia, Manish Banthia, and Nikhil Kabra since December 2015, December 2020, September 2013, and December 2020, respectively.

The fund’s investment objective is to generate long-term capital appreciation and current income from a portfolio invested in equity, equity-related securities, and fixed-income securities.

Trailing returns

The fund has consistently outperformed the benchmark (CRISIL Hybrid 35+65Aggressive Index) and its peers (funds ranked under the aggressive hybrid fund category in the September 2022 CMFR) in all the trailing periods under analysis.

An investment of ~10,000 in the fund on April 3, 2002, (inception of the benchmark) would have grown to ~2.63 lakh on November 30 this year at an annualised rate of 17.2 per cent, compared with the category and the benchmark, which would have grown to ~2.06 lakh (15.7 per cent per annum) and ~1.47 lakh (13.9 per cent per annum), respectively.

A systematic investment plan is a disciplined mode of investment offered by mutual funds through which one can invest a certain amount at regular intervals.

A monthly investment of ~10,000 over 10 years in the fund, totalling ~12 lakh, would have grown to ~28.31 lakh (16.37 per cent annualised returns), compared with ~23.57 lakh (12.95 per cent annualised returns) in the benchmark as on November 30 this year.

Portfolio analysis

Over the past three years, the fund’s asset mix has comprised 72.96 per cent average allocation to equity and 27.03 per cent to debt. The equity portfolio has been diversified across market capitalisations, with predominant exposure to large-cap stocks.

Allocation to large-cap stocks averaged 62.81 per cent in three years, while allocation to midand small-cap stocks averaged 5.06 per cent and 5.08 per cent, respectively.

The equity portfolio was diversified across 35 sectors in three years. Banks had the highest average allocation at

20.86 per cent, followed by power (9.92 per cent), telecommunications (7.81 per cent), non-ferrous metals (6.12 per cent), and software (6.1 per cent).

Over the past three years, the debt portfolio majorly comprised sub-aaarated papers. Allocation to sub-aaarated papers averaged 16.69 per cent in three years. Exposure to AAA/A1+ securities averaged 0.91 per cent, while allocation to sovereign securities averaged 5.36 per cent.

Over the past three yers, asset mix has comprised 72.96% average allocation to equity and 27.03% to debt