Fund review: SBI Bluechip Fund

Two key factors are expected to impact earnings of corporate India.One, the implementation of Goods and Services Tax (GST). Two, the impact of demonetisation on the earnings of key companies. Given the unpredictable impact the two variables could have on corporate earnings, it makes sense to be with established large players. Large companies, given their size, brand acceptance, established market share and relatively sound balance sheets are less likely to show high divergence in their earnings. Hence, it makes sense for retail investors to be with schemes which have singular focus on selecting large-sized companies with high conviction. One such scheme is SBI Bluechip.

The scheme's fund manager, Sohini Andani, has been managing it for close to seven years. It invests 80% in large-sized companies and remaining money of the portfolio is geared towards mid-sized companies. Andani follows bottom-up approach in selecting stocks.Besides this, Andani also takes into account essential return ratios that provide a greater clarity of how a company would perform in the longterm. This has worked in her favour. In the past threeand five-year periods, the scheme has delivered 16.8% and 20% returns while its benchmark index S&P BSE 100 has delivered 9% and 14%, respectively, during the same period.

In the past six months, the scheme's fund manager has bought scheme's fund manager has bought in companies which are beaten down and are also value `buys'.

Besides this, Andani has picked up market leaders across sectors.

These are Hero MotoCorp, State Bank of India, ICICI Bank and Tata Steel.