Motilal Oswal Asset Management Company has launched its latest Mutual Fund, the Motilal Oswal Nifty India Defence Index Fund. The fund aims to enable investors to capitalize on the growth prospects within the Indian Defence industry.
The Motilal Oswal Nifty India Defence Index Fund will operate as an open-ended fund, mirroring the performance of the Nifty India Defence Total Return Index to provide comprehensive exposure to this sector’s overall growth and returns.
The New Fund Offer (NFO) will be open for subscription from 13th June 2024 to 24th June 2024.
The Nifty India Defence Total Return Index mirrors the performance of companies involved in manufacturing and servicing defence projects. The Index comprises 15 companies that are also part of the broader Nifty total market index.
This thematic fund is designed to attract investors seeking exposure to various segments of the defence sector, including defence equipment manufacturing, technology development, and related services. The fund launch comes at a time when India is prioritizing the enhancement of Indigenous defence capabilities and fostering self-reliance in defence production.
As of May 31, 2024, the Nifty India Defence Index has shown impressive compound annual growth rates (CAGR) of 177% over the past year and 89.5% over the past three years. This underscores the robust growth potential within the Defence sector. However, it’s important to note that investments in Defence companies may also involve higher volatility due to the sector’s characteristics.
Prateek Agrawal, MD & CEO, of Motilal Oswal Mutual Fund, said, “India’s strides towards Atmanirbharta (Self-Reliance) in defence is paving the way for significant growth and innovation.
With the Motilal Oswal Nifty India Defence Index Fund, we aim to capitalize on the projected $100 billion to $120 billion expansion in the defence sector over the next six years. As the fourth largest defence spender globally, India’s focus on self-reliance and modernization offers substantial opportunities for domestic defence companies.
This fund is poised to benefit from This fund is poised to benefit from India’s robust advancements in defence technology and infrastructure.
Salient Features of Motilal Oswal Nifty India Defence Index Fund
Asset Allocation:
The scheme primarily invests in equity schemes that target stocks aligned with the special situations theme.
Investment Strategy:
The scheme adopts a passive investment strategy, focusing on investing in the components of the Nifty India Defence Total Return Index.
Who Should Invest?
Investors with a very high-risk tolerance and an interest in the special situations theme are suitable candidates for the Motilal Oswal Nifty India Defence Index Fund, especially those looking at an investment horizon of 5 years or more.
Risk Profile:
The fund is associated with a very high level of risk.
Benchmark:
Nifty India Defence Total Return Index
Fund Managers:
Swapnil Mayekar, Rakesh Shetty
