UTI is one of the pioneers of the Indian Mutual Fund Industry. With a total Asset Under Management of INR 15.56 lakh crore. The AMC is among the most trusted names in the mutual fund space and offers products across asset classes. Let us talk about the – UTI Innovation Fund.
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About UTI Innovation Fund
Innovation fosters unique ideas that could create new markets, increase growth, and/or disrupt incumbents in their domains. Over the past few years, India’s focus on innovation and adoption of technology has led it to emerge as the third-largest start-up ecosystem globally. We believe innovation is an important catalyst for economic growth and wealth creation. This fund by UTI aims to capture this innovation theme.
Investment Objective
It is an open-ended equity scheme following innovation theme. The Fund aims to invest predominantly in innovation-oriented companies and disruptors with potential of delivering non-linear growth outcomes.
The scheme intends to provide medium to long-term capital appreciation through investment primarily in growth and innovation-oriented equity and equity-related instruments.
Note: There is no assurance or guarantee that the investment objective of the scheme would be achieved.
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Investment Thesis
The investment strategy of the scheme focuses on the below:
Innovation – Companies that use innovation to enhance productivity, create environmental and social impact
Growth – Companies having significant potential for growth, demonstrated track record of developing the market and/or gaining market share
Quality – Companies that are financially strong with market leadership, robust business models, quality management and corporate governance
Source: UTI MF
Portfolio Composition
The funds are allocated 93.8% to equity, 0.92% debts and 5.29% Cash and Cash Equivalents.
Top 5 Equity Holdings for UTI Innovation Fund
Name | Sector | % |
Zomato | Technology | 6.66 |
Pb Fintech | Financial | 6.49 |
Info Edge (India) | Technology | 5.88 |
FSN E-Commerce | Consumer Discretionary | 5.43 |
Praj | Industrials | 4.53 |
Source: Value Research
Performance Since Inception
Period | NAV (%) | Nifty 500 TRI (%) | (%) |
Since Inception | 5.27 | 16.84 | 13.44 |
Source: UTIMF
Fund Manager
The fund is managed by Mr. Ankit Agarwal. He holds a post graduate degree in Management (PGDM) from IIM, Bangalore. He joined UTI in August 2019. Presently he has been designated as Fund Manager; managing UTI Mid Cap Fund. He has more than 12 years of experience. Prior to joining UTI, he was working with Lehman Brothers, Barclays Wealth and had been associated with Centrum Broking Ltd in the capacity of Senior Vice President.
Who Should Invest?
- Investors looking for a true to label innovation fund that is benchmark agnostic and backed by research expertise.
- Investors seeking relatively high growth potential and willing to ride the underlying waves of innovation.
- Investor who wants to invest through lump sum or staggered (SIP/STP) allocation and with a long-term horizon.
Time horizon
- The fund is ideal for investment with a time horizon of 5 years or above.
- Investment through Systematic Investment Plan (SIP) may help in tackling the volatility of the broader equity market.
Conclusion
The equity portion of the fund’s portfolio is managed actively with a bottom-up stock-picking approach, while the debt portion is managed with a focus on credit quality and liquidity. The fund has performed with a CAGR of 5.27% since inception, while having very high risk. Since the fund has just 6 month ago and it would be interesting to see whether the fund will meet its benchmark return in the future or not.
Disclaimer: This is not recommendation advice. All information in this blog is for educational purposes only.