HDFC Equity Fund is an open-ended growth scheme, which aims to generate long-term

capital appreciation. The Scheme maintains a focused portfolio predominantly of large

cap stocks, though there is controlled exposure to mid caps. The Scheme however
always remains diversified across sectors. Moreover, the sectoral allocation is done with
a view to diversify across sectors that are weakly co-related with each other to reduce
risk.

Details about the Fund:

Objective: To achieve capital appreciation by investing primarily in equity oriented
securities.
Structure: Open-ended Growth Scheme
Inception Date: January 01, 1995
Plans and Options under the Plan: 
Growth & Dividend Option.
Face Value (Rs/Unit): Rs. 10
Minimum Investment: 
For new investors: Rs.5000 and in multiples of Rs.100 thereafter. For existing investors:
Rs. 1000 and in multiples of Rs. 100 thereafter
Entry Load : For investments below Rs. 5 crores, Entry load is 2.25%. For Investments of
Rs. 5 crores and above, Entry Load is Nil.
Exit Load : Nil.

Investment Pattern
The corpus of the Scheme will be invested primarily in equity and equity related
instruments. The Scheme may invest a part of its corpus in debt and money market
instruments, in order to manage its liquidity requirements from time to time, and under
certain circumstances, to protect the interests of the Unit holders.

The asset allocation under the Scheme will be as follows :

 Sr.No Type of Instruments Normal Normal Deviation Risk
. Allocation (% of Normal Profile
(% of Net Allocation)
Asset)
1 Equity & Equity 80 - 100 0 Medium
related instruments to High
2 Debt Securities, Money 0 - 20 0 Low to
Market instruments & Medium
Cash
(including money at
call)

Returns of the fund:

Mean : 0.14

Standard Deviation: 0.85

Upper Limit: 1.84

Lower limit: -1.55

120

100

80

60

40

20

0
-4 -3 -2 -1 0 1 2 3

The normal Distribution of HDFC Equity Growth Mutual Fund

 30

25

20

HDFC Index Fund Sensex Plan

15
HDFC Equity Fund (growth)
LIC MF Equity Fund( growth)

10

0
-6 -4 -2 0 2 4 6 8
Composition of HDFC Equity Growth Fund:

Portfolio Composition

Total assets as on 30-Sep-10 is Rs. 14234.02 million

Portfolio Details as on 30-Sep-2010

% of
No. of Mkt. Asset Weighte
Company Sector Shares Value* s Beta d Beta
EQUITY SHARES 97.48

1006.6
INFOSYS TECH I T - Software 330000 7 7.07 0.667 4.716
STATE BANK O Banks 278000 900.85 6.33 1.15 7.280

Consumer Non 483261

I T C LTD Durables 0 861.65 6.05 0.529 3.200
ONG CORP LTD Oil 596353 837.34 5.88 0.87 5.116
ICICI BANK Banks 707397 787.3 5.53 1.56 8.627

Petroleum 102505
BHARAT PETRO Products 7 768.33 5.4 0.486 2.624
HOUS DEV FIN Finance 912500 669.05 4.7 1.02 4.794

Industrial Capital 199940

CROMPTON GR. Goods 8 625.22 4.39 1.12 4.917
BK OF BARODA Banks 669151 583.83 4.1 0.973 3.989

SUN PHARMA Pharmaceuticals 272365 550.31 3.87 0.557 2.156

Media And 181300

ZEE ENTER Entertainment 3 544.26 3.82 1.05 4.011

SOLAR IND Chemicals 983257 497.53 3.5 0.707 2.475

 Media And 230700
HT MEDIA Entertainment 0 371.2 2.61 1.42 3.706
101900
BIOCON LTD Pharmaceuticals 6 366.13 2.57 0.94 2.416

Petroleum
RELIANCE Products 358500 353.93 2.49 1.47 3.660
COROM INTER Fertilisers 555818 341.69 2.4 0.89 2.136

Telecommunicatio
BHARTI ARTL ns -Service 922517 337.92 2.37 0.79 1.872
155000
NTPC LTD Power 0 336.27 2.36 0.71 1.676
300000
PETRONET LNG Gas 0 317.85 2.23 0.99 2.208

Consumer Non
NESTLE LTD Durables 75268 254.57 1.79 0.36 0.644

Construction 161173
NAG CONS COM Projects 8 252.88 1.78 1.57 2.795

Industrial Capital
THERMAX Goods 317366 254.07 1.78 1.07 1.905
OIL INDIA Oil 155785 234.02 1.64 1.14 1.870

Auto And 281306

APOLLO TYRE Ancillaries 9 228.14 1.6 0.82 1.312

C & C CONSTR Construction 796496 203.35 1.43 1.08 1.544

Auto And
AMARA RAJA B Ancillaries 872454 185.18 1.3 1.23 1.599
142860
PURAVANKARA Construction 0 183.86 1.29 1.73 2.232

MAYTAS INFRA Construction 761912 171.81 1.21 1.36 1.646

IL&FS TRANS Engineering 497649 158.45 1.11 1.17 1.299

435430
NHPC Power 2 138.03 0.97 0.53 0.514
396728
BALLARPUR IN Paper Products 7 137.07 0.96 0.873 0.838

KNR CONST Construction 710597 132.03 0.93 1.08 1.004

GAIL Gas 195087 93.16 0.65 0.67 0.436

Industrial Capital
EIMCO ELECON Goods 276428 84.82 0.6 1.12 0.672
117566
ISMT LTD Ferrous Metals 8 58.84 0.41 0.67 0.275
 TECHNOCRAFT Ferrous Metals 538745 47.11 0.33 0.97 0.320
Cash and Other Assets NA NA 359.31 2.54 92.481
 

Grand Total 100.00%

Weighted Beta of the

Portfolio 0.949

With the individual weights and individual beta we can find the weighted beta which
is .949 less than market beta of 1.

Comparison between the returns of HDFC Growth Fund with the Benchmark
Returns.

HDFC Growth (NAV as at evaluation date 30-Sep-10, Rs.93.228 Per unit)

Fund
Date Period NAV Per Unit Returns Benchmark Returns
(Rs.) (%) ^ (%) #
March 30, 2007 Last 1280 days 45.461 22.73** 13**
March 30, 2010 Last Six months (184 74.504 25.13* 14.09*
days)
September 30, Last 1 Year (365 68.47 36.16* 17.18*
2009 days)
September 28, Last 3 Years (1098 63.818 13.43** 5.08**
2007 days)
September 30, Last 5 Years (1826 31.382 24.31** 18.36**
2005 days)
September 29, Last 10 Years (3653 9.724 25.34** 17.22**
2000 days)
September 11, Since Inception (3671 10.000 24.85** 15.54**
2000 days)

We see the fund has outperformed the benchmark return consistently since its
inception.

The required rate of return for the last year is

Ke = Rf+B(Rm-Rf)
Where Rf = Risk free rate based on the last 91 days

T-Bill cut off of = 6.2735%.

B=.949

Rm = The Market(Nifty) Return for 1 year is 29%

So the Ke is 27.84%.

From Date NAV(Rs.) To Date NAV(Rs.)

09-11-2009 69.652 04-11-2010 97.110

Absolute Returns* = 39.4%

So HDFC Mutual Fund has given higher return than the market in the last 1 year.