PGIM India Introduces New Multi Cap Investment Scheme

PGIM India Mutual Fund today announced the launch of PGIM India Multi Cap Fund, an open-ended equity scheme investing across large cap, mid cap and small cap stocks. The fund is benchmarked against Nifty 500 Multicap 50:25:25 TRI.

The New Fund Offer (NFO) opens for subscription on August 22, 2024, and closes on September 05, 2024.

“Given near term volatility in the equity markets, a typical question we face is “What do you think about the markets?” That’s a difficult one to answer and anybody’s guess. However, the second follow up question one gets is “Where do you think we should invest for the current market conditions?” While this is best answered for each individuals’ specific situation and goals by a trusted advisor, a simple step could be to take exposure to all market capitalizations in a disciplined format. A multi cap strategy provides investors with a disciplined approach to diversify their exposure towards all market caps,” said Ajit Menon, CEO, PGIM India Asset Management.

"We believe it’s a good time to invest in a diversified portfolio of good quality and high growth companies, as these have significantly underperformed in the last few years despite strong growth in their intrinsic values. We have seen early signs of outperformance of this strategy post the election results and the change in Bank of Japan's monetary policy, in the last couple of months," said Vinay Paharia, CIO, PGIM India Asset Management.

The scheme will invest a minimum of 25% each in large, mid and small cap stocks, respectively. While typically the balance 0 - 25% will be invested in ground up opportunities across any or all of the three market cap buckets, the scheme also has a provision to take exposure in debt (up to 25%), up to 10% in REITs and InvITs, and up to 20% in foreign securities, including overseas ETFs. 

The equity portion of the scheme will be managed by Vivek Sharma, Anandha Padmanabhan Anjeneyan and Utsav Mehta while the debt portion will be managed by Puneet Pal.

“There are good long term opportunities available across market capitalizations which will benefit from India's growth juggernaut. What we need is careful stock picking and a balanced portfolio to take advantage of this. It is imperative to have exposure to all market capitalizations at all times which also changes appropriately according to the opportunities available. PGIM India Multi Cap Fund aims to do just that,” said Vivek Sharma, Senior Fund Manager - Equity, PGIM India Asset Management.

Multi Cap strategy entails a balanced approach towards investment, in both established and emerging fast-growing sectors across the mid and small-cap space. As winners keep rotating across different market capitalizations, A Multi Cap Fund provides disciplined exposure across different market caps capturing ideas regardless of the size. *Our research shows that Nifty 500 Multicap 50:25:25 TRI has outperformed Nifty 500 TRI in 11 out of last 19 years from 31-Dec-05 to 31-Jul-24.

The portfolio construction approach is bottom-up and well-diversified. The fund adopts Growth at a Reasonable Price (GARP) focused strategy with flexibility to adjust between short, medium and long-term growth opportunities based on market conditions. It may allocate to turnaround ideas, event-driven opportunities, and stocks showing momentum, driven by earnings growth in the medium to long term. The fund aims to capitalise on themes such as healthcare, financialization, mobility, consumption, new energy, among others, which are emerging on account of the structural changes undergoing in the Indian economy.  

Key Features

Minimum Application Amount

·         Initial Purchase/Switch-in: Minimum of Rs. 5,000 and in multiples of Re. 1 thereafter.

·         Additional Purchase:  Minimum of Rs. 1,000 and in multiples of Re. 1 thereafter.

·         SIPs: Minimum no. of 5 instalments and minimum amount per instalment - Rs. 1,000/- each and in multiples of Rs.1 thereafter.

Exit Load

For each purchase of units through Lumpsum/switch‐in/Systematic Investment Plan (SIP) and Systematic Transfer Plan (STP):

·         Within 90 days from date of allotment of units: 0.50%.

·         Beyond 90 days from date of allotment of units: NIL

The entire exit load (net of Goods and Services tax), charged, if any, shall be credited to the scheme.