Nippon Life India Asset Management has announced the launch of Nippon India Innovation Fund, an open-ended equity scheme investing in innovation theme.
The fund will invest at least 80 percent of its assets in innovative companies that have the potential to disrupt their industries and create significant value for investors in the long term. It will have the flexibility to invest across market caps and sectors.
Nippon India Innovation Fund: Key dates
The NFO will open on August 9 and close on August 23. The minimum investment amount required during NFO is ₹500 and in multiples of Re 1 thereafter.
The proposed fund will primarily invest in a diversified portfolio of companies that are driving innovation across themes such as fintech, specialty chemicals & pharma, auto & auto ancillaries, internet-based businesses, MNCs etc.
The fund will give a thrust on the companies which are taking advantage of early trends. The fund managers will focus on the companies that are undergoing a technological change forcing most participants to change.
The emphasis will be given on the companies forming a part of digital economy or gaining market share through digital economy.
Nippon India Innovation Fund’s NFO
|80 percent assets in innovative companies
|Nifty 500 TRI
The fund’s flexibility will allow it to identify the better investment opportunities by identifying companies ahead of the curve in new innovation, technologies or business models. The fund may be well-positioned to capture companies that have the potential for significant growth.
The scheme’s performance will be benchmarked against Nifty 500 TRI.
The scheme will have both options of growth plan and IDCW (income distribution cum capital withdrawal) plan. The former will have growth option and the latter will have payout option and reinvestment plan.
Sailesh Raj Bhan, CIO – Equity Investments, Nippon India Mutual Fund said, “Over the next 20 years India is likely to witness significant investment in Innovation and R&D (Research & Development). The need for creating differentiation through innovation is a key growth driver for the long-term success of any business.Participating in this space is critical as Innovation led transformation and transition may offer growth possibilities across multiple segments.… Nippon India Innovation Fund to capture some of these potential opportunities.”
Such themes may have higher gestation periods, therefore the fund house will attempt to manage the risks through adequate diversification across sectors.