HDFC Mutual Fund launches HDFC Business Cycle Fund NFO. HDFC Asset Management Company Ltd. (HDFC AMC), one of India’s leading mutual fund houses that manages assets worth INR 4.22 trillion as on 30 Sept 2022*, has announced the launch of HDFC Business Cycle Fund, in order to expand their suite of equity offerings. HDFC Business Cycle Fund aims to invest in businesses likely on the cusp / midst of a favourable business cycle.The captioned NFO opens on November 11, 2022, and closes on November 25, 2022.
Just how GPS enables us to choose better routes to reach our destination faster, and avoid routes with obstructions / higher traffic, HDFC Business Cycle Fund aims to achieve better investment outcomes by investing in companies likely to enjoy favourable business cycles, while avoiding companies about to enter / in a business downcycle.
Business Cycle investing enjoys benefits, such as higher confidence on business cycle forecasts vs economic cycle forecasts. In business upcycles, investors may gain from dual benefits of earnings growth and improvement in valuations. In business cycle investing, one needs an agile investment strategy that dynamically rotates investments based on assessment of stages of business cycles.
Commenting on the launch, Mr. Navneet Munot, Managing Director and Chief Executive Officer, HDFC Asset Management Co. Ltd. said, “In an era marked by increasing complexities and shortening of business cycles, positioning portfolios well should be a rewarding activity. HDFC AMC aims to support investors to stay ahead by using a blend of top down and bottom up approach, leveraging strengths in its research and fund management team. The launch of this NFO is a further step in the direction of being the wealth creator for every Indian.”
The Scheme will be managed by Mr. Rahul Baijal, who has over 20 years of experience in Fund Management and equity research. Commenting on HDFC Business Cycle Fund, Rahul Baijal, who is the Fund Manager of this Scheme, said, “We have observed business cycles across history, and how they impact fundamentals. HDFC Business Cycle Fund brings a blend of top-down and bottom-up approach towards picking companies positioned favourably in their business cycles, with the aim to achieve better risk-adjusted returns and aid wealth creation for investors. India is expected to be among the fastest growing large economies, and strong fundamentals hold us in good stead in a global environment of rising risks. Factors such as improving health of the banking and real estate sector, increasing investments by corporates bode well for equities over medium to long term. We believe that investing in the business cycle fund could be a good allocation strategy and the fund could be held by investors for long periods of time.”
HDFC Business Cycle Fund will manage risks by being adequately diversified across sectors / sub sectors / market cap, and across number of stocks. It is therefore a well-diversified fund suitable for long term investments via both lumpsum and SIP.
Investors may consider this product to gain exposure to businesses likely on the cusp / midst of favourable business cycles, via a fund that is agile in rotation of investments based on assessment of stages of business cycles, and with an investment horizon of 3 or more years.