ICICI Prudential Mutual Fund on Monday announced the launch of ICICI Prudential Innovation Fund, an open-ended thematic equity scheme which will predominantly invest in equity, equity related securities of companies and units of global mutual funds/ETFs that can benefit from innovation strategies and themes. The new fund offer (NFO) is available for subscription till April 24, 2022.
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The scheme will follow a bottom up approach and can take exposure to companies involved in product/services/solution related innovation. The scheme can invest across market cap, basis suitable opportunities, the fund house said.
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Speaking on the launch of the product, Chintan Haria, Head - Investment Strategy at ICICI Prudential AMC said, “As countries look to become increasingly self-sufficient in terms of resources, innovation as a theme is likely to do well going forward globally and domestically. With the deployment of 5G technology, a wide gamut of sectors/industries stand to benefit and India already has a robust ecosystem in place for nurturing innovation.”
"Through this offering an investor will have access to companies involved in product/service/solution related innovation both in India and overseas. Given that innovation can happen anywhere, our research team will track sector/theme specific trends," Haria said.
The scheme will invest a minimum of 80 percent in companies adopting innovation strategies and themes and overseas securities adopting innovation strategies and themes. The scheme will be both sector and market-cap agnostic.
The scheme may invest up to 20 percent of its net assets in ADR/GDR / Foreign securities/Mutual Funds/ETFs, the fund house said.
Undercurrents favoring innovation theme
Pandemic: Importance of supply chain diversification was best realized during the pandemic leading to good scope for innovation.
Geo-Politics: Uncertainties around Russia-Ukraine War, US-China tensions have probed countries to look for better options to reduce dependencies.
Inflation: As countries look to counter high inflation with domestically manufactured products, innovation could do well.
Normalizing interest rate environment: As globally and domestically, Central Banks seem to approach fag end of interest rate hike cycle, growth stocks may perform well. Given that the scheme is likely to have a growth bias, this strategy tends to do well in a normalizing interest rate environment.
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The scheme will be managed by Anish Tawakley and Vaibhav Dusad. Overseas investment will be managed by Sharmila D’Mello. The benchmark of the scheme is Nifty 500 TRI.
(Edited by : Anshul)
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