This Navi New Fund Offer (NFO) may help you make the most of India’s manufacturing boom. Check details

Navi Nifty India Manufacturing Index Fund is India’s first index fund focusing on the manufacturing sector.

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Navi Mutual Fund has announced the launch of Navi Nifty India Manufacturing Index Fund, which is India’s first index fund focusing on the manufacturing sector, a statement from the company said. This is the sixth fund of this year from Navi MF. 

As per the scheme document, Navi Nifty India Manufacturing Index Fund is an open-ended index fund that will seek to replicate the Nifty India Manufacturing Index, which will track the performance of manufacturers among the top 300 companies in India.  

Why manufacturing?

Manufacturing is one of the high-growth sectors in India buoyed by the government’s constant support to strengthen the sector. The statement noted that the ‘Make in India’ initiative, Production Linked Incentive (PLI) Scheme and the Skill India initiative are a few of the programmes aiming to put India on the world map as a global manufacturing hub. Foreign Direct Investment policy initiatives aimed at reducing restrictions have led to an increase in foreign investment. FDI in the manufacturing sector increased by 25% to $16.3 billion in 2021. 

Also Read: How have mutual funds helped Indians get rich post-independence?

Key points

  • Navi Nifty India Manufacturing Index Fund aims to simplify investing in the Indian manufacturing sector. 
  • The scheme will provide easy and cost-effective access to the entire manufacturing landscape through an index that is well diversified across sectors and market caps. 
  • Investors would gain exposure to not just the leaders of the sector but also to growth in upcoming sectors like electric vehicles, semiconductors, defense, etc., among others. 

Aditya Mulki is the fund manager of the NFO

Nifty India Manufacturing Index performance

The largest sectors in the Nifty India Manufacturing Index currently are Automobile & Auto Components, Capital Goods, Healthcare, and Metals & Mining. It also has a well-balanced representation, with the top 10 stocks constituting only ~37% of the index. 

The index has delivered attractive average annual returns in the past – 8.9%, 24.5%, 9.6%, 14.5%, and 14.3% CAGR over the last 1, 3 , 5 , 10 years and since its inception in 2005, respective) which indicates that over the last 10 years the index is up 3.9 times from its original level.  

Key dates

The NFO opens on August 12th, 2022 and closes on August 23rd, 2022. 

What should investors do? Investing in the new fund offer of a mutual fund may be risky as the past performance may or may not be sustained in future. It is always better to take the advice of a professional financial advisor before making any investment decision. (Also Read: Whether it is good or bad to invest in NFO)

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