- Date : 06/09/2023
- Read: 4 mins
Key details of the PGIM India Midcap Opportunities Fund, along with an insight into its investment strategy and long-term growth prospects.
MC30 is a list of mutual funds frequently referred to by investors and industry watchers. The selection of mutual fund schemes is curated by MoneyControl and features the best schemes as identified by the portal’s team of experts.
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MC30 has acted as a ready reference for investors looking for good fund schemes
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The PGIM India Midcap Opportunities Fund is singled out by MC30 for future success
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PIMOF has delivered consistent long-term returns of 17% CAGR since its inception
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Its high risk and return strategy can be a recipe for success
MC30 has been widely tipped PGIM India Midcap Opportunities Fund (PIMOF) for handsome long-term growth.
PGIM India Midcap Opportunities Fund – Key Details
PIMOF invests in equity and equity-related instruments of mid-cap companies to achieve long-term capital growth. Here are some of the key features –
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The scheme started in December 2013
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Its compounded annualised growth rate (CAGR) since inception is 17.4%
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The three-, five- and seven-year CAGRs are 30%, 19% and 17% respectively
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The fund managers are Vinay Paharia, Anandha Anjeyneyan and Puneet Pal
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It follows the Nifty Midcap 150 TRI as the benchmark
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Its fund break-up between large, mid and small cap is 18:68:7
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Its NAV has increased from 13.3 in March 2020 to 47.75 now. However, it has increased by only Rs 3.4 in one year
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The low recent growth is attributed to its under-allotment in PSU and over-reliance on consumer discretionary stocks
An Insight Into The Scheme
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PIMOF managers claim that the fund has invested in companies with consistent and proven growth records and has good earning visibility
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The fund has been churning aggressively in the last few months. Its portfolio has increased from 44 to 64 in the last six months
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In the churning process, the fund exited from cyclical sectors like commodities. It has reduced consumer durables and banks and has added auto ancillary and financial services to its portfolio
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It has added stocks like HDFC Bank, Kotak Mahindra Bank, PI Industries, United Spirits and Blue Star to its kitty
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Stocks like Cholamandalam, UNO Minda, Kajaria Ceramics, Dixon, L&T Tech, Coforge and Escorts Kubota have given good returns to the fund
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It has nearly 10% allotment in finance, auto components and industrial products, followed by 5.5 to 6% allotment in chemicals and banks
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Its mid-cap allotment is higher than the category average of 67%
Conclusion
The fund is sharpening its investment strategy by adding more companies with structural growth and adopting a high-risk, high-return strategy. Its active churning spell is expected to be followed by a buy-and-hold policy. Investors with a high risk appetite and long-term investment horizon are likely to benefit from the fund.
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Also Read: The Potential Of Mid-cap Stocks: A Look At 14 Undervalued Holdings By Mutual Funds
Disclaimer: This article is intended for general information purposes only and should not be construed as insurance or investment or tax or legal advice. You should separately obtain independent advice when making decisions in these areas.
