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Mahindra Manulife Investment Management is launching a New Fund Offer (NFO) for the Mahindra Manulife Manufacturing Fund, an open-ended equity scheme focused on the manufacturing theme. This mutual fund investment aims to capitalise on India's manufacturing sector, which is expected to grow significantly due to supportive government policies, global shifts in supply chains, and infrastructure development.

Mahindra Manulife Manufacturing Fund details

- Fund Managers: The fund will be managed by Mr. Renjith Sivaram Radhakrishnan, Mr. Manish Lodha, and Mr. Pranav Nishith Patel, who bring expertise in managing equity and overseas investments.

- Investment Objective: The primary goal is to generate long-term capital appreciation by investing predominantly in equity and equity-related securities of companies engaged in the manufacturing sector.

- Benchmark: The performance of the fund will be benchmarked against the S&P BSE India Manufacturing TRI index.

- Plans and Options: The scheme offers both Regular and Direct plans with Growth and Income Distribution cum Capital Withdrawal (IDCW) options.

Why the manufacturing theme?

1. Government Policies: Initiatives, like Make in India, Atmanirbhar Bharat, and Production Linked Incentives (PLI), are expected to boost the manufacturing sector.

2. Global Trends: Diversification of production away from China and increased demand for Indian manufactured goods in global markets present substantial growth opportunities.

3. Infrastructure Development: Investments in infrastructure, including transportation, power, and industrial facilities, are likely to support manufacturing growth.

Investment strategy of the Mahindra Manulife Manufacturing Fund

The fund will follow a bottom-up approach, focusing on companies:

- Engaged in manufacturing activities with strong growth potential.

- Benefiting from government incentives.

- Positioned to take advantage of export promotion and import substitution.

- Investing in new manufacturing capacities and technologies.

Asset allocation of Mahindra Manulife Manufacturing Fund

- Equity and Equity-related securities: 80-100% in companies engaged in the manufacturing theme.

- Other Equity Instruments: Up to 20% in companies not within the manufacturing theme.

- Debt and Money Market Securities: Up to 20% to manage liquidity and risk.

- Units issued by REITs & InvITs: Up to 10%.

Capex expansion

Several sectors within the manufacturing theme are planning significant capital expenditures, indicating strong future growth prospects. Key sectors include power, defence, cement, semiconductors, and water infrastructure.

Mahindra Manulife Manufacturing Fund NFO Details

- Opening Date: May 31, 2024

- Closing Date: June 14, 2024

- Reopens for Continuous Sale and Repurchase: June 26, 2024

Who should invest in the Mahindra Manulife Manufacturing Fund?

This fund is suitable for investors seeking long-term capital appreciation by investing in the manufacturing sector. Investors should consult with financial advisors to ensure this fund aligns with their investment goals and risk tolerance.

By investing in the Mahindra Manulife Manufacturing Fund, investors can potentially benefit from India's manufacturing growth story, driven by favourable policies, global trends, and substantial infrastructure investments.