Details on the First HSBC AMC NFO After Its Acquisition of L&T AMC

A look at the various aspects of the NFO launched by HSBC AMC in the multi-cap category

HSBC AMC Multicap NFO

By the end of November 2022, HSBC Asset Management India confirmed the acquisition of L&T Investment Management for an agreed sum of around $425 million. L&T Investment Management manages L&T Mutual Fund and was wholly owned by L&T Finance Holdings. It was planned that all existing L&T Mutual Fund schemes would be transferred to or merged with HSBC Mutual Fund schemes. The launch of a New Fund Offering (NFO) by HSBC AMC has caught people’s attention, particularly in the wake of the high-profile acquisition.

Also Read: What is NFO and how to invest in NFOs

Points to Remember

On 9 January 2023, HSBC Mutual Fund confirmed the launch of HSBC Multicap Fund. 

  • This NFO will be open from 10 January 2023 till 24 January 2023. 
  • It is an open-ended equity scheme and as the name suggests it will invest in large-cap, mid-cap and small-cap stocks. 
  • Just as multi-cap schemes are required to, this scheme will invest a minimum of 25% each across stocks in these three market cap categories. 
  • The minimum subscription amount for this NFO is Rs 5,000 and in multiples of Re.1 beyond that. An additional investment of Rs 1,000 can be made per application, with multiples of Re 1 thereafter. 
  • The scheme is offering both regular and direct plans, which will have two further options – Growth and Income Distribution cum Capital Withdrawal (IDCW). IDCW will have a payout of IDCW and reinvestment options.
  • Systematic Transfer Plan (STP) and Systematic Withdrawal Plan (SWP) will be available only after the scheme becomes available for regular sales and purchases. 
  • As a benchmark, it will track the Nifty 500 Multicap 50:25:25 Total Return Index, 
  • The scheme has no entry fees,
  • If you redeem or switch less than 10% of the units within a year of allotment, there are no exit charges. For redemption or switch of units above this limit, the exit load will be 1%.
  • The scheme’s risk-o-meter rating is Very High.

Also Read: Should you invest in mutual fund NFO?

The Fund Managers

The HSBC Multicap fund’s fund managers are,

Venugopal Manghat – CIO-Equities,

Sonal Gupta – Head of Equity Research,

Kapil Punjabi – Senior VP.

Mr Manghat commented that AMC’s investment strategy is a bottom-up approach. This involves the evaluation of companies on parameters like capital allocation, returns, competitive advantages, business potential, management, profitability etc. He also stated the firm’s belief in long-term investment for gaining compounding benefits.

Scheme’s Strategy

The focus will be on identifying strong businesses with high earning potential, practical valuation and sustainable profit prospects. 

It will focus on bottom-up stock picking and strong franchises, and achieve performance across seasons through the multi-cap portfolio.

It will maintain risk adjustments through increased diversification and better delivery potentials.

Also Red: Multi-cap PMS strategies that have delivered up to 21% in the last 5 years

Conclusion

Being a strictly equity-oriented fund, it will have inherent risk and investors must see it from a long-term investment appreciation objective. A look at your existing schemes and their asset allocation is also worth considering before investing in this multi-cap scheme.

Source 

https://mintgenie.livemint.com/news/personal-finance/nfo-alert-hsbc-multi-cap-fund-to-open-on-january-10-here-s-all-you-need-to-know-151673263116498

https://economictimes.indiatimes.com/mf/mf-news/hsbc-acquires-lt-mf-schemes-to-be-transferred-or-merged-with-hsbc-schemes/articleshow/95821551.cms

https://www.sebi.gov.in/filings/mutual-funds/nov-2022/hsbc-multicap-fund_64810.html

By the end of November 2022, HSBC Asset Management India confirmed the acquisition of L&T Investment Management for an agreed sum of around $425 million. L&T Investment Management manages L&T Mutual Fund and was wholly owned by L&T Finance Holdings. It was planned that all existing L&T Mutual Fund schemes would be transferred to or merged with HSBC Mutual Fund schemes. The launch of a New Fund Offering (NFO) by HSBC AMC has caught people’s attention, particularly in the wake of the high-profile acquisition.

Also Read: What is NFO and how to invest in NFOs

Points to Remember

On 9 January 2023, HSBC Mutual Fund confirmed the launch of HSBC Multicap Fund. 

  • This NFO will be open from 10 January 2023 till 24 January 2023. 
  • It is an open-ended equity scheme and as the name suggests it will invest in large-cap, mid-cap and small-cap stocks. 
  • Just as multi-cap schemes are required to, this scheme will invest a minimum of 25% each across stocks in these three market cap categories. 
  • The minimum subscription amount for this NFO is Rs 5,000 and in multiples of Re.1 beyond that. An additional investment of Rs 1,000 can be made per application, with multiples of Re 1 thereafter. 
  • The scheme is offering both regular and direct plans, which will have two further options – Growth and Income Distribution cum Capital Withdrawal (IDCW). IDCW will have a payout of IDCW and reinvestment options.
  • Systematic Transfer Plan (STP) and Systematic Withdrawal Plan (SWP) will be available only after the scheme becomes available for regular sales and purchases. 
  • As a benchmark, it will track the Nifty 500 Multicap 50:25:25 Total Return Index, 
  • The scheme has no entry fees,
  • If you redeem or switch less than 10% of the units within a year of allotment, there are no exit charges. For redemption or switch of units above this limit, the exit load will be 1%.
  • The scheme’s risk-o-meter rating is Very High.

Also Read: Should you invest in mutual fund NFO?

The Fund Managers

The HSBC Multicap fund’s fund managers are,

Venugopal Manghat – CIO-Equities,

Sonal Gupta – Head of Equity Research,

Kapil Punjabi – Senior VP.

Mr Manghat commented that AMC’s investment strategy is a bottom-up approach. This involves the evaluation of companies on parameters like capital allocation, returns, competitive advantages, business potential, management, profitability etc. He also stated the firm’s belief in long-term investment for gaining compounding benefits.

Scheme’s Strategy

The focus will be on identifying strong businesses with high earning potential, practical valuation and sustainable profit prospects. 

It will focus on bottom-up stock picking and strong franchises, and achieve performance across seasons through the multi-cap portfolio.

It will maintain risk adjustments through increased diversification and better delivery potentials.

Also Red: Multi-cap PMS strategies that have delivered up to 21% in the last 5 years

Conclusion

Being a strictly equity-oriented fund, it will have inherent risk and investors must see it from a long-term investment appreciation objective. A look at your existing schemes and their asset allocation is also worth considering before investing in this multi-cap scheme.

Source 

https://mintgenie.livemint.com/news/personal-finance/nfo-alert-hsbc-multi-cap-fund-to-open-on-january-10-here-s-all-you-need-to-know-151673263116498

https://economictimes.indiatimes.com/mf/mf-news/hsbc-acquires-lt-mf-schemes-to-be-transferred-or-merged-with-hsbc-schemes/articleshow/95821551.cms

https://www.sebi.gov.in/filings/mutual-funds/nov-2022/hsbc-multicap-fund_64810.html

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