HDFC Mutual Fund Launches India’s First Defence Fund
HDFC Asset Management, the investment manager to HDFC Mutual Fund (HDFC MF), announced the launch of HDFC Defence Fund on Tuesday. The fund caters to those who plan to invest in defence and allied sector companies. It follows a bottom-up approach of portfolio construction within the defence ecosystem. The captioned NFO opens on 19 May, 2023, and closes on 2 June, 2023.
According to the company’s official statement, Defence as a sector sees a constant need to modernise its platforms due its strategic relevance for the country and technological advancements. Through initiatives like Make in India, the government policies remain conducive to the growth of the defence sector in the country.
HDFC Defence Fund will seek to invest in companies with good quality management with demonstrated track record and aim to achieve diversification by following a multi-cap strategy. The Fund’s focus would be on growth and quality at reasonable valuations by investing across large, mid and small cap stocks.
Commenting on the launch, Navneet Munot, Managing Director and Chief Executive Officer, HDFC Asset Management Company said, “Defence readiness is critical to peace, prosperity and social well-being. The Government has also been pushing for Aatmanirbharta in defence sector. With HDFC Defence Fund, the first of its kind fund investing in companies in the defence and allied industries, we are presenting investors an opportunity to participate in structural growth potential of India's defence sector “
The scheme will be managed by Abhishek Poddar- Fund Manager – Equity and Senior Equity Analyst, Dealing & Investments, HDFC Asset Management who has over 17 years of experience in equity research, investment banking and corporate finance. Commenting on HDFC Defence Fund, Poddar said, “In a multipolar world, defence expenditure globally is set to increase as countries enhance their defence capabilities. Self-reliance in defence led by strong R&D focus and enhancement of manufacturing capabilities creates opportunities for Indian companies to serve the domestic market as well as tap large export potential. This could offer a multi-decadal investment opportunity.”
What Is The Fund About :
HDFC Defence Fund is an open-ended equity scheme investing in Defence & allied sector companies. The scheme will invest at least 80% of its Net Assets in Defence & allied sector Companies. Defence & allied sector stocks include:
Stocks forming part of certain eligible ‘basic industries’ based on AMFI Industry classification including Aerospace & Defence, Explosives, Ship Building & Allied Services as amended from time to time;
Stocks from any other defence & allied sectors as per benchmark’s criteria; or
Stocks present on SIDM (Society of Indian Defence Manufacturers) list and which obtain at least 10% of revenue from the defence segment as mentioned above
