India Fund Underperforms The Over All Periods - Nov 04, 2008

HSBC Asset Management (India) Private Limited set up in May 2002 as a trust by HSBC Securities and Capital Markets (India) Pvt. Ltd. The fund manages assets worth Rs 15532.81 crore as on September 2008.HSBC Advantage India Fund (G) an open-ended equity scheme launched in December 2005. The objective of the scheme is to invest in equity and equity related securities primarily in sectors, areas and themes that play an important role or benefit from India’s progress reform process and economic development.The minimum investment amount is Rs 10,000 and in multiples of Re 1 thereafter. The unit NAV of the scheme was Rs. 8.37 as on 31 October 2008.

The total net assets of the scheme decreased by Rs.78.79 crore to Rs.495.10 crore in September 2008.HSBC Advantage India Fund (G) took fresh exposure to three stocks in September 2008. The scheme has purchased 77528 units (2.30%) of State Bank of India, 83711 units (1.34%) of Reliance Infrastructure, 4.27 lakh units (0.54%) of Allahabad Bank in September 2008.

The scheme completely exited Jindal Steel & Power by selling 46155 units (1.53%), HDFC Bank by selling 54976 lakh units (1.22%) and Tata Power Company by selling 60900 units (1.12%) in September 2008.Sector-wise, the scheme took fresh exposure to Banks - Public Sector at 2.84% in September 2008.Sector-wise, the scheme completely exited from Steel - Sponge Iron at 1.53% in September 2008.

The scheme had highest exposure to Infosys Technologies with 2.02 lakh units (5.70% of portfolio size) followed by Bharat Heavy Electricals with 1.77 lakh units (5.69%) and Bharti Airtel with 3.57 lakh units (5.67%) among others in September 2008.

It reduced its exposure to Jaiprakash Associates by selling 1.49 lakh units to 10.43 lakh units (by 1.07%), PSL by selling 1.24 lakh units to 3.56 lakh units (1.04%) and Cairn India by selling 1.27 lakh units to 5.21 lakh units (0.58%) among others in September 2008.

Sector-wise, the scheme had highest exposure to Construction at 10.58% (from 11.85% in August 2008), followed by Telecommunications - Service Provider at 8.96% (7.21%) and Computers - Software – Large at 6.81% (6.72%) among others in September 2008.

Sector wise, the scheme had reduced Steel – Large to 3.24% (by 1.31%), Construction to 10.58% (by 1.27%) and Engineering - Turnkey Services to 5.34% (by 0.53%) in September 2008.The scheme underperformed the category average over all time periods. It has underperformed the Sensex over all time periods.

Over three-month period ended as on 31 October 2008, the scheme posted negative returns of 34.79% underperforming the category average, which posted negative returns of 30.23%. It underperformed the Sensex that has posted negative returns of 31.82% during the same period.Since inception, the scheme posted negative returns of 16.31% underperforming the category average of 75.27%.