HDFC Mutual Fund announced the launch of HDFC Non-Cyclical Consumer Fund, an open-ended equity scheme following a non-cyclical consumer theme.
The scheme opened for public subscription on June 23, 2023, and will close on July 07, 2023. The scheme re-opens for continuous sale and repurchase within five business days from the date of allotment.
Q. What kind of mutual fund scheme is this?
This is an open-ended equity scheme following a non-cyclical consumer theme.
Q. What is the main objective of investing in this fund?
The investment objective of the scheme is to generate long-term capital appreciation by investing predominantly in equity and equity-related securities of companies with a focus on non-cyclical consumer themes.
Commenting on the launch, Navneet Munot, Managing Director and Chief Executive Officer, HDFC Asset Management Company, said, “We are delighted to introduce the HDFC Non-Cyclical Consumer Fund to our investors. This new offering reflects our commitment to delivering differentiated opportunities in the market that help investors reach their wealth creation goals. As India moves further into ‘Amritkaal’, the consumption sector finds itself at an inflection point. Aided by factors such as India’s GDP per capita surpassing US $2000, themes including demographic dividend, premiumization, formalization, and digitization which are expected to drive growth in this sector.”
Q. How may one invest in this scheme?
Investors can invest under the scheme with a minimum investment of ₹100 per plan/option and in multiples of Re 1. There is no upper limit for investment.
Under normal circumstances, the asset allocation (% of net assets) of the scheme’s portfolio will be as follows:
Indicative allocations (% of total assets)
Equity and Equity related instruments of Non-Cyclical Consumer companies
High to Very High
Equity and Equity related instruments of companies other than above
High to Very High
Units of REITs and InvITs
Medium to High
Debt securities, money market instruments and Fixed Income Derivatives
Low to Medium
Units of Mutual Fund
Low to High
Q. Are there similar mutual funds in the market?
To date, no asset management company (AMC) has launched any such fund in the past.
Q. How will the scheme benchmark its performance?
The performance of the scheme will be benchmarked against the Nifty India Consumption Index (TRI). As required under the SEBI circular dated October 27, 2021, the benchmark has been selected from amongst those notified by AMFI as the first-tier benchmark to be adopted by mutual funds and which is reflective of the category of the scheme. The performance will be benchmarked to the Total Returns Variant of the Index.
Q. Are there any entry or exit loads to this scheme?
This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” would be calculated as under:
- In respect of each purchase/switch-in of units, an Exit load of one per cent is payable if units are redeemed/switched out within one year from the date of allotment.
- No Exit Load is payable if units are redeemed/switched out after a year from the date of allotment.
Q. Who will manage this scheme?
Amit Sinha is the designated fund manager of this scheme.
Q. Does the fund contain any inherent risk?
The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.