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PlaystoreAditya Birla Sun Life AMC Limited
Aditya Birla Sun Life AMC Limited
Multi-cap Fund
• The objective of the scheme is to achieve long-term growth of capital, at relatively moderate levels of risk through a diversified, research-based investment in Large, Mid & Small cap companies.
• The scheme will invest 25-45% in Large cap and a minimum of 25-35% each in Mid and Small cap segments.
• It follows a Bottom-up approach of stock selection.
• The Portfolio will be biased towards secular growth opportunities from across the market spectrum.
What is a Multi-cap fund?
The economy today is on a path to recovery – with growth estimates for FY 22 pegged at 12.50%1. An accommodative monetary policy, numerous growth stimulating policy and fiscal measures, increase in foreign inflows – are some of the few pre-cursors paving the way for a broad-based growth in the country. This is likely to bring growth opportunities across the board and across all market caps. The National Stock Exchange (NSE) in India, itself houses the stocks of over 1900 companies1. The top 100 being segmented into large cap, the next 150 being mid-cap and the balance being small cap.
How can an investor effectively choose from such a vast universe of stocks? With the large expected to become larger, and the mid and small expected to benefit from economic recovery and growth stimulus – how can an investor suitably capitalise on diverse investing opportunities?
A multi-cap fund can be the answer for investors here. A multi cap fund is an equity oriented mutual fund scheme that invests across market capitalisations – with a minimum of 25% portfolio allocation each to large, mid and small caps. A multi-cap fund looks to select the ‘best from the best’ and provide investors with a diverse portfolio of growth-oriented stocks.
About Aditya Birla Sun Life Multi-Cap Fund
Aditya Birla Sun Life Multi-Cap Fund is an open-ended equity scheme investing across large cap, mid cap and small cap stocks in a disciplined manner. The objective of the Scheme is to achieve long term growth of capital, at commensurate levels of risk through a diversified research-based investment in Large, Mid & Small cap companies. The Scheme does not guarantee/indicate any returns. There can be no assurance that the schemes’ objectives will be achieved.
The scheme will allocate 80-100% in equity instruments, with a 25-45% allocation to large cap and 25-35% allocation each to mid-cap and small cap stocks.
The fund follows a focussed and disciplined approach seeking out secular growth opportunities across market capitalisations. Its investing strategy is based on a bottom-up approach – with the focus being on identifying companies with sound corporate governance, competitive advantage and considerable and sustainable growth potential. It will narrow down to a portfolio of 50-60 companies from an investment universe of 400+ companies.
This strategy can help the fund to benefit from the growth momentum in the economy while maintaining high quality of the fund portfolio.
The product labeling assigned during the NFO is based on internal assessment of the Scheme characteristics or model portfolio and the same may vary post NFO when the actual investments are made.
Why one can invest in Aditya Birla Sun Life Multi-Cap Fund now?
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• Suitable in times of broad-based growth: This Fund seeks out opportunities across large, mid and small caps which makes it suitable to take advantage of a likely broad based market rally.
• Fiscal stimulus can benefit companies across the board: Growth boosting policy measures are directed across sectors and can bring in inclusive and diverse growth. This fund seeks out potential from across the board.
• A mix of stability and growth potential: The fund can provide investors with the stability of large caps along with the growth potential of emerging mid-caps and small caps.
• To take advantage of emerging opportunities: The funds focused and disciplined approach along with its bottom-up investing strategy is directed towards identifying and investing in growth opportunities as and when they arise
Benefits Of Multicap Fund
Long term capital appreciation potential of equity
Investing strategy seeks out stocks with high and consistent growth potential. This can help long-term investors achieve sustainable capital appreciation of their wealth.
Diversity in true sense
Provides a combination of 3 focussed portfolios within one fund – focused large cap, focused mid cap and focused small cap. This can provide investors the relative stability of large caps as well as the accelerated growth potential of upcoming mid and small caps
Portfolio flexibility
Fund manager has the flexibility to invest balance 25% of portfolio in emerging opportunities, irrespective of market capitalisation it belongs to
Fund manager expertise
Access to expertise and knowledge of experienced fund manager to hand-pick quality stocks across market capitalisations
Sources:
1. International Monetary Fund (IMF) estimates for India for FY 2022 in its publication World Economic Outlook published on 6th April, 2021
2. As on 31st March 2021 - https://www.nseindia.com/regulations/listing-compliance/nse-market-capitalisation-all-companies
Why invest now?
High Uncertainty
The pandemic has resulted in high uncertainty in the business environment.
Development of opportunities
With the changing behaviour and as we adjust to the ‘new normal’, several new trends and companies have emerged in different sectors.
Revision of ratings
The companies whose ratings have suffered due to current lack of demand can expect a boost in their valuations once things return back to normal.