{"id":30,"date":"2019-04-01T11:26:54","date_gmt":"2019-04-01T11:26:54","guid":{"rendered":"http:\/\/blog.certifiedfinancialguardian.com\/?p=30"},"modified":"2019-04-02T10:09:31","modified_gmt":"2019-04-02T10:09:31","slug":"icici-prudential-bharat-consumption-fund-a-worthy-proposition","status":"publish","type":"post","link":"https:\/\/blog.certifiedfinancialguardian.com\/index.php\/2019\/04\/01\/icici-prudential-bharat-consumption-fund-a-worthy-proposition\/","title":{"rendered":"ICICI Prudential Bharat Consumption Fund: A Worthy Proposition?"},"content":{"rendered":"\n

As you may know, the Interim Budget 2019<\/a> was a pro-farmer and pro-middle-class budget \u2013\u2013an attempt was made to leave a higher disposable income in the hands of the common man. Apart from increasing household savings, the Union Budget 2019, is also expected to provide a boost to India\u2019s consumption story. ICIC Prudential Mutual Fund<\/a> has come up with a New Fund Offer: ICICI Prudential Bharat Consumption Fund, an open-ended equity scheme following the consumption theme. <\/p>\n\n\n\n

ICICI Prudential Bharat Consumption Fund\n(IPBCF) aims to capture the change in spending pattern and will invest in\ncompanies that may directly or indirectly benefit from the increase in consumption led demand. <\/p>\n\n\n\n

India has a demographic advantage, income\nlevels are rising, and there is a rise in double-income families, nuclear\nfamilies, affluent middle-class families, which all augur well for India\u2019s\nlong-term consumption story.<\/p>\n\n\n\n

In addition, lowering borrowing rates, easy\naccess to consumer credit, technology, and changing lifestyle choice offers a\nthrust to India\u2019s consumption story. <\/p>\n\n\n\n

\"\"<\/figure><\/div>\n\n\n\n

(Source: IPBCF\u2019s one pager<\/a>)<\/p>\n\n\n\n

Recognising<\/g> the thematic nature and IPBCF\u2019s investment objective, the Scheme is suitable for investors seeking capital appreciation over the long-term- with an investment time horizon of around 7-10 years. However, given the portfolio concentration to one theme and its allied sectors, IPBCF is a very high risk-high return investment proposition. IPBCF finds its place at the high end of the risk-return spectrum and hence, not suitable for the faint-hearted.<\/p>\n\n\n\n

Table 1: NFO Details <\/em><\/strong><\/p>\n\n\n\n

\n
\n Type<\/strong>\n <\/td>\n An\n open-ended equity scheme \n <\/td>\n Category<\/strong>\n <\/td>\n Sector\/thematic\n – Consumption\n <\/td><\/tr>
\n Investment\n Objective<\/strong>\n <\/td>\n To generate long-term\n capital appreciation by investing primarily in Equity and Equity related\n securities of companies engaged in consumption and consumption related\n activities or allied sectors. However\n there can be no assurance or guarantee that the investment objective of the\n scheme would be achieved.\n <\/td><\/tr>
\n Min.\n Investment<\/strong>\n <\/td>\n Rs\n 5,000 and in multiples of Re. 1 thereafter.\n <\/td>\n Face\n Value<\/strong>\n <\/td>\n Rs\n 10 per unit\n <\/td><\/tr>
\n Plans <\/strong>\n <\/td>\n \u2022\n Regular
\n
\n \u2022 Direct\n <\/td>		\n Options<\/strong>\n <\/td>\n \u2022 Growth *
\n \u2022 Dividend
\n     \u2022 Pay-out\n Dividend
\n     \u2022 Reinvest\n Dividend**
\n   * default option\n   **default option in case of dividend option\n \n <\/td><\/tr>
\n Entry\n Load<\/strong>\n <\/td>\n Nil\n <\/td>\n Exit\n Load<\/strong>\n <\/td>\n 1%\n of the applicable NAV  – If the amount sought to\n be redeemed or switch out is invested for a period of up to twelve months\n from the date of allotment\n  \n Nil – If the amount,\n sought to be redeemed or switch out is invested for a period of more than\n twelve months from the date of allotment. \n <\/td><\/tr>
\n Fund\n Managers<\/strong>\n <\/td>\n Mr Rajat Chandak \n  \n Mr Dharmesh Kakkad\n <\/td>\n Benchmark\n Index<\/strong>\n <\/td>\n Nifty India Consumption\n Index\n <\/td><\/tr>
\n Issue\n Opens<\/strong>\n <\/td>\n March\n 26, 2019\n <\/td>\n Issue\n Closes:<\/strong>\n <\/td>\n April\n 09, 2019\n <\/td><\/tr><\/tbody><\/table>\n<\/div>\n\n\n\n

(Source: Scheme Information Document<\/a>)<\/p>\n\n\n\n

How\nwill the Scheme allocate its assets?<\/strong><\/p>\n\n\n\n

Under normal circumstances, the IPBCF’s asset allocation<\/a> will be as under:<\/p>\n\n\n\n

Table\n2: IPBCF’s Asset Allocation<\/em><\/strong><\/p>\n\n\n\n

\n
\n Instruments<\/strong>\n <\/td>\n Indicative Allocation (% of Total\n Assets)<\/strong>\n <\/td>\n Risk Profile<\/strong>\n <\/td><\/tr>
<\/td>\n Maximum<\/strong>\n <\/td>\n Minimum<\/strong>\n <\/td><\/td><\/tr>
\n Equity and Equity Related Instruments of\n companies engaged in consumption and consumption related activities or allied\n sectors*\n <\/td>\n 100\n <\/td>\n 80\n <\/td>\n High\n <\/td><\/tr>
\n Other equity and equity related\n securities\n <\/td>\n 20\n <\/td>\n 0\n <\/td>\n Medium to High\n <\/td><\/tr>
\n Debt, Units of debt Mutual Fund schemes\n and Money market instruments\n <\/td>\n 20\n <\/td>\n 0\n <\/td>\n Medium to Low\n <\/td><\/tr>
\n Gold\/Gold ETF\/Units issued by REITs\/\n InvITs such other asset classes as may be permitted by SEBI from time to time\n (subject to applicable SEBI limits)\n <\/td>\n 20\n <\/td>\n 0\n <\/td>\n Medium to High\n <\/td><\/tr><\/tbody><\/table>\n<\/div>\n\n\n\n

(Source: Scheme Information Document<\/a>)<\/p>\n\n\n\n

*Indicative\nlist of sectors\/industries falling under consumption and consumption related\nactivities or allied sectors are as follows: <\/p>\n\n\n\n

  1. Automobile including auto components companies <\/li>
  2. Consumer Goods including consumer durables, consumer\nnon-durables, retailing etc. <\/li>
  3. Energy <\/li>
  4. Healthcare Services <\/li>
  5. Media & Entertainment <\/li>
  6. Pharma <\/li>
  7. Services such as Commercial and Engineering Services, Hotels\nResorts and Recreational Activities, Transportation, Trading, etc. <\/li>
  8. Telecom <\/li>
  9. Textiles <\/li><\/ol>\n\n\n\n

    Please\nnote that the above list is indicative and the Fund Manager may add such other\nsector\/industries which satisfy the consumption theme. The Fund Manager may\nalso add other sectors as may be added in Nifty Consumption Index from time to\ntime.<\/p>\n\n\n\n

    Further, it is stated in the offer document\nthat the scheme may have exposure to:<\/p>\n\n\n\n