HDFC Defence Mutual Fund Delivers Over 100% Returns in Less Than a Year

The Surge of Defence Stocks on D-Street

It’s no secret that defence stocks have been rallying on D-Street, with many turning into multibaggers over the medium-term period. For investors who prefer not to invest directly in defence stocks, there is an alternative: the HDFC Defence Fund. This fund invests in companies within the defence and allied sectors.

HDFC Defence Fund Overview

The HDFC Defence Fund falls under the sectoral/thematic category and boasts a fund size of Rs 2696.26 crore, with an expense ratio of 1.99%. The fund has allocated 96.48% of its investments to domestic equities, with 3.91% in large-cap stocks, 18.56% in mid-cap stocks, and 31.08% in small-cap stocks.

Suitable For:

This fund is ideal for investors with advanced knowledge of macro trends who prefer to take selective bets for potentially higher returns compared to other equity funds. However, these investors should also be prepared for the possibility of moderate to high losses, even when the overall market is performing well.

Impressive Returns

Since its inception in June 2023, the HDFC Defence Fund has delivered absolute returns of 109.4% and annualised returns of 114.26%. This remarkable performance has made the fund a multibagger in less than one year.

Benchmark and Top Holdings

The benchmark for this fund is the Nifty India Defence Index TRI. The top five holdings of the HDFC Defence Fund are:

• Hindustan Aeronautics Ltd
• Bharat Electronics Ltd
• Premier Explosives Ltd
• Solar Industries Ltd
• Astra Microwave Products Ltd

Experienced Fund Management

The fund is managed by Mr. Abhishek Poddar, who has over 17 years of experience, including 13 years in equity research. His extensive expertise in the field is a significant asset to the fund’s performance and strategy.

Investors looking for exposure to the booming defence sector and are willing to accept the associated risks may find the HDFC Defence Fund to be an attractive option.

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Disclaimer: This post has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.