New Delhi, May 16, 2023: HDFC Asset Management Co. Ltd., investment manager to HDFC Mutual Fund (HDFC MF), one of India’s leading mutual fund houses has announced the launch of HDFC Defence Fund that plans to invest in defence & allied sector companies. It follows a bottom-up approach of portfolio construction within the defence ecosystem. The captioned NFO opens on May 19, 2023, and closes on June 02, 2023
Defence as a sector, sees a constant need to modernize 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 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, Mr. Navneet Munot, Managing Director and Chief Executive Officer, HDFC Asset Management Company Limited 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 Mr. Abhishek Poddar- Fund Manager – Equity and Senior Equity Analyst, Dealing & Investments, HDFC Asset Management Company Limited who has over 17 years of experience in equity research, investment banking and corporate finance. Commenting on HDFC Defence Fund, Abhishek 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 opportunity for Indian companies to serve domestic market as well as tap large export potential. This could offer a multi-decadal investment opportunity.”
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:
(i) 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; or
(ii) Stocks from any other defence & allied sectors as per benchmark’s criteria; or
(iii) 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.
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