Fund Review - Reliance Capital Builder Fund IV - Series A
The fund will invest in high conviction 20-25 stocks in at least 4-5 sectors. Besides, the fund will buy a Nifty 50 put option at a later stage to limit the downside risk. However, it will depend upon the market condition.
Oct 06, 2017 05:10 IST others
Reliance Capital Builder Fund IV is a close-ended equity oriented fund which will invest across sectors and market capitalization.
The fund will invest in high conviction 20-25 stocks in at least 4-5 sectors. Besides, the fund will buy a Nifty 50 put option at a later stage to limit the downside risk. However, it will depend upon the market condition.
The fund will primarily invest in three themes - Rural Recovery, Pharma and Corporate Lenders. Below are the rationales of investing in the themes:
Recovery in Rural Demand
The fund will invest in high conviction 20-25 stocks in at least 4-5 sectors. Besides, the fund will buy a Nifty 50 put option at a later stage to limit the downside risk. However, it will depend upon the market condition.
The fund will primarily invest in three themes - Rural Recovery, Pharma and Corporate Lenders. Below are the rationales of investing in the themes:
Recovery in Rural Demand
- Consecutive 2 years of good monsoon.
- High MSPs in kharif crop in 5 years and farm loan waivers in few states to increase the disposable income.
- Higher government spending on rural infrastructure.
- 3 crore houses to be built in rural India under Housing for All Scheme.
Low valuation in Pharma sector
- In the last 2 years, the sector valuation is lowered by ~30% and the sector is trading below its historical valuations.
- Domestic story remains strong in long term as penetration is rising.
Private Capex to revive
- NPA cycle has peaked and NPA resolutions are underway.
- The valuations of corporate lenders are relatively reasonable compared to retail lenders.
- Recapitalization of PSU banks to boost the lending.
Below are the scheme details:
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Scheme Details |
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Fund Type |
Close Ended Equity Oriented Scheme |
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NFO Period |
Sep 29, 2017 – Oct 13, 2017 |
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Benchmark |
S&P BSE 200 Index |
|
Tenure |
3 years from the date of the allotment of the units |
|
Fund Manager |
Ms. Meenakshi Dawar and Ms. Jahnvee Shah (Overseas Investments) |
|
Allocation (%) |
Equity: 80-100% Debt: 0-20% |
