NFO Review: Axis Capital Builder Fund to take a multi-cap approachAxis Capital Builder Fund is a closed-ended equity fund with a term of 1540 days (a bit more than four years) which will invest in stocks across market capitalization (large-cap, mid-cap and small-cap). The fund will hold a concentrated portfolio of 30-40 stocks selected from the ‘Axis Universe,’ a larger set of 350 stocks.

The fund will follow a bottom-up approach and focus on the key elements of the ‘Axis strategy’, centred on:

  1. Growth Bias – looking for sustainable growth
  2. Quality Businesses
  3. Superior risk-adjusted returns
  4. High conviction investing

Following the rural push in Budget 2018, the fund will embrace rural India as one of its key themes. It will focus on rural consumption and infrastructure as key sectors for its portfolio. It will also try to maintain a large-cap allocation of at least 50% of the portfolio. The fund may also hedge (convert to debt-like returns) up to 15% of its portfolio.

RupeeIQ Take

Closed-ended funds have no established track record to evaluate them against. This particular one has no distinctive theme either other than a generic focus on good investment practices and promising sectors. One has to rely on the overall record of the fund managers and the fund house. Both fund managers, in this case, are highly experienced.

Anish Naik and Anupam Tiwari will manage the fund. Naik has been an Assistant Fund Manager with Axis Mutual Fund for about two years following about seven years as a Research Analyst with the same fund house. He previously worked with Goldman Sachs. Anupam Tiwari was a Research Analyst at Reliance AMC for about 6 years and then a fund manager at Principal PNB for about 5 years. He has worked with Axis Mutual Fund as a fund manager for about 1.5 years.

Two general advantages of closed-ended funds are:

  1. The fund managers’ performance can be better when they do not have to worry about sudden inflows and outflows
  2. The lock-in stops you from panic selling the fund or buying in a rush at the wrong time.

Key Details

Term: 1540 days

Benchmark: Nifty 500

Minimum Investment: Rs 5000

NFO Period: 16th February to 1st March 2018

Options: Growth, Dividend Payout

Fund Managers: Anish Naik and Anupam Tiwari

Our other NFO coverage

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NFO Review: Kotak India Growth Fund Series 4 to capitalise on the rise and fall

SBI Long Term Advantage Fund (Series V) review: Invest and forget

NFO Review: Aditya Birla Resurgent India Fund – Series 6 focuses on rural theme

NFO Review: Sundaram Emerging Small-cap Fund Series 1 launches 5-year fund

Note: Mutual fund investments are subject to market risks. Read all scheme related documents carefully. Talk to your financial advisor before investing.

Author
Neil Borate

Neil Borate is Deputy Editor, RupeeIQ. He can be contacted at neil@rupeeiq.com.