Leading fund house Groww Mutual Fund has announced the launch of India’s first Nifty Non-Cyclical Consumer Index Fund ‘Groww Nifty Non-Cyclical Consumer Index Fund’. The New Fund Offer will remain open for subscription from May 2-16, 2024, the asset management company said in a statement on Thursday.
The fund, an open‐ended scheme tracking Nifty Non-Cyclical Consumer Index–TRI, will be managed by Abhishek Jain.
Groww Nifty Non-Cyclical Consumer Index Fund aims to generate long-term capital growth by investing in securities of the Nifty Non-Cyclical Consumer Index (TRI) in the same proportion/weightage, the company said.
“This is to offer returns before expenses that track the total return of the Nifty Non-Cyclical Consumer Index…,” it said.
The scheme will be benchmarked against the Nifty Non-Cyclical Consumer Index (Total Return Index). The index selection is structured such that the largest companies by market cap from the selected industries are part of the index. The index, therefore, is a collection of some of the most loved consumer brands in the country today. Companies with consumer brands that are seen, and used daily, which have built trust over a long period of time.
Because of the continued spending of consumers into these products, these companies tend to be slightly more insulated from economic cycles and therefore are seen as non-cyclical sectors.
The index forming these companies has shown more resilience than the broader market, during market volatility. Data shows that Nifty Non-Cyclical Consumer Index has also performed in comparison to Nifty 50 over 1, 3, 5, 10 and even 15 year time frames.
Harsh Jain, Co-founder and COO, Groww said, “The Groww Nifty Non-Cyclical Index Fund is India’s first index fund, which enables people to invest in the top stocks from consumer industries such as FMCG, textiles, etc., These companies manufacture items we need in our daily lives and tend to be slightly more insulated from economic cycles and therefore are seen as non-cyclical sectors. This fund is tailored for investors who desire long-term, consistent wealth creation by investing in the top consumer brands seen and utilised by people across India.”
Key attributes of the NFO:
The minimum investment amount will be Rs 500 and in multiples of Re 1 for purchases and of Re 0.01 for switches. For SIP, the minimum amount is Rs 1,200 (subject to a minimum of 12 SIP instalments of Rs 100 each for monthly instalments and Rs 300 for quarterly instalments).
The scheme will invest 95-100% in equities and equity-related securities of companies engaged in or expected to benefit from consumption and consumption-related activities and 0-5% in debt and money market instruments /and units of debt schemes/units of debt ETFs.
In respect of each purchase/switch-in of units, an exit load of 1% is payable if units are redeemed/switched out within 30 days from the date of allotment. No exit load is payable if units are redeemed/switched out after 30 days from the date of allotment.
The Nifty Non-Cyclical Consumer Index aims to track the performance of a portfolio of stocks that largely denote the Non-Cyclical Consumer theme within basic industries such as consumer goods, consumer services, telecom, services, media, entertainment, publication, textiles and others.