L&T Infrastructure Fund: Fund Review

In the past five- and 10-year periods, the scheme has given 17.4% and 13.2% returns, while its category has given 12% and 11.3 %, respectively, in the same period.

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In the past five years, the infrastructure sector has received a great deal of attention from the government. The total awarding of road contracts from the Ministry of Roads, Transport and Highways and the National Highway Authority of India (NHAI) has grown eight times to 24,452 km in the past five years ending FY18. During the same period, the pace of road construction per day also improved from 15.9 km in FY13 to 27 km in FY18, which, in turn, has strengthened the order books of construction, cement and certain roads companies in the broad infrastructure theme.

According to various estimates, there are a bunch of construction companies which have visibility of revenues for the next four years. Given these factors, it makes sense to be with mutual fund schemes which have a special focus on infrastructure. One such scheme is L&T Infrastructure Fund.

Soumendra Nath Lahiri, the scheme’s fund manager, has not only constructed a portfolio which is properly geared towards the infrastructure theme but has also maintained consistency in the scheme’s performance. In the past five- and 10-year periods, the scheme has given 17.4% and 13.2% returns, while its category has given 12% and 11.3 %, respectively, in the same period. Investors must consider investments in the scheme with a minimum five-year view in mind.


Portfolio change (past 6 months)
New Entrants Complete exits Increase in allocation
BHEL Tata Steel Thermax
HPCL Vedanta Bharat Electronics
JSW Steel Navkar Corporation ISGEC Heavy Engg

Returns (in%)
Period CAGR return SIP CAGR return Equity sector Infrastructure - AVG
annualised return
1 year -9.80 -3.69 -8.02
3 year 16.14 6.10 11.56
5 year 17.45 11.06 13.27

Returns peer comparison (in%)
Scheme 1-year 3-year 5-year
DSP T.I.G.E.R Fund -5.92 13.15 14.31
Franklin Build India Fund 4.96 15.27 21.16
Invesco India Infrastructure Fund -5.67 11.09 14.72
Source: Accord Fintech, compiled by ETIG Database

Expert Take
Kaustubh Belapurkar, Director, Fund Research, Morningstar

The fund is one of the few infrastructure schemes that invest purely in infra-related stocks with zero exposure to sectors such as financial services. Lahiri runs the fund with a multi-cap style and constructs a reasonably diversified portfolio to reduce the overall risk. He is an excellent stock picker, which reflects in the long-term performance of the fund.
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