SIG1 NAV surges to Rs 16.33; NBF-1 rises to 14.31, but both remain undervalued

ShareSansar, January 27:

Siddhartha Investment Growth Scheme-1, a closed-end 5 years mutual fund scheme managed by Siddhartha Capital Limited, has reported a net asset value (NAV) of Rs 16.33 for the month of Pousg, up from 15.01 posted in the previous month.

Likewise, Nabil Balanced Fund-1, a closed-end 5 years mutual fund scheme managed by Nabil Investment Banking Limited, has reported an impressive growth of its net asset value (NAV) Rs 14.31 in Poush up from Rs 13.31 for the month of Mangshir.

The NAVs of both the mutual funds have been steadily rising over the past few months.

However, the schemes are still undervalued in the market as shown by the last traded price of SIG1, which closed at Rs 12.7 yesterday and NBF-1, which stands at Rs 11.2 — much below the NAV.

This clearly suggests that the price of the units are being buoyed by the bullish trend in the stock market, more than other factors such as better understanding of such scheme and the dividend the scheme is pledging, which is better than the pledged amount.

SIG!, which began with a total fund of Rs 50 crore, invested Rs 72 crore in listed shares, Rs 3.81 crore in public issues and Rs 43 thousand on other share investments in Bhadra.
 
NBF-1, which began with a total fund of Rs 50 crore, invested Rs 8.90 crore in listed shares, Rs 1.25 crore in bonds and 7.5 crore in fixed deposits in Poush.

Lack of awareness among the investors among the benefits of mutual funds is one of the major reasons behind the underestimation of such schemes, according to analysts.

Among the two mutual funds listed in the share market, Siddhartha Investment Growth Scheme 1 (SIG1) is also trading below par due to similar reasons.