Rally in banking stocks benefits infrastructure equity mutual funds

MUMBAI: The rally in the equity markets over the last week brought in huge relief for the infrastructure funds that have been struggling to make some decent returns for the investors for quite a while now.

Infrastructure equity schemes, on an average, generated close to 4% returns for the investors during the week, only behind Banking and FMCG Sector equity funds that gave 7.7% and 5.9% returns, on an average, respectively, during this period.

While FMCG and Banking sectors have been doing reasonably well for quite a while, the slowing economic growth has clearly paralyzed the infrastructure sector resulting in under performance of the equity mutual funds that invested in this sector in good times.

However given the decent exposure to the financial services space by most infrastructure schemes, these schemes could also benefit from the recent rally seen in the banking stocks. S&P BSE Bank index has gained over 7.5% during the week, making it the best performing sectoral index way ahead of Sensex returns of 2.56% during the period

The top performing schemes in the infrastructure category included - UTI Infrastructure Fund with 6.28% returns for the week followed by HDFC Infrastructure Fund with 5.72% gains and Goldman Sachs Infra BeES with 5.63% returns.

While UTI Infra holds over 28% of its Rs 1715 crore AUM in financial services space, HDFC Infra fund's holding in this sector is as high as 37.9%.