DSP World Agriculture Fund

One of the largest AMCs in India, DSP has been helping investors make sound investment decisions responsibly and unemotionally for over 25 years. DSP is backed by the DSP Group, an almost 160-year-old Indian financial giant. 

The family behind DSP has been very influential in the growth and professionalization of capital markets and the money management business in India over the last one-and-a-half centuries  

Let us talk about the consumer product: DSP World Agriculture Fund. 

About the DSP World Agriculture Fund 

Investment objective

The primary investment objective of the Scheme is to seek capital appreciation by investing predominantly in units of BlackRock Global Funds – Nutrition Fund (BGF – NF). 

The Scheme may, at the discretion of the Investment Manager, also invest in the units of other similar overseas mutual fund schemes, which may constitute a significant part of its corpus.

It shall be noted, similar overseas mutual fund schemes shall have investment objectives, investment strategies, and risk profiles/considerations similar to those of BGF-NF.

The Scheme may also invest a certain portion of its corpus in money market securities and/ or money market/liquid schemes of DSP Mutual Fund, in order to meet liquidity requirements from time to time.  

Portfolio composition 

The portfolio holds major exposure in ingredients that account for roughly 15% of the portfolio. The top five sectors hold nearly 53% of the portfolio

Top ten holdings DSP World Agriculture Fund

Name	Weightage %
Deere & Co	4.9%
FMC Corporation	4.8%
Graphic Packaging Holding Co	4.7%
Agco Corporation	4.4%
Symrise AG	4.2%
Salmar ASA	4.2%
Zoetis Inc	4.2%
Barry Callebaut AG	4.2%
Grocery Outlet Holding Corp	4.1%
Koninklijke DSM NV	4.1%

Performance

The fund has generated a CAGR (Compounded Annual Growth Rate) of 6% since its inception. 

Fund manager 

• Mr. Jay Kothari, Vice President & Product Strategist has been managing the fund since March 2013. He is the dedicated Fund Manager for overseas investments and has been with DSP Investment Managers since May 2005, and has been with the Investment function since January 2011. Jay joined the firm as a member of the Sales team (Banking) in May 2005. Prior to joining DSPIM, Jay worked for Standard Chartered Bank for a year in the Priority Banking division. Jay completed his Bachelor of Management Studies (Finance & International Finance) from Mumbai University, followed by an MBA in Finance from Mumbai University. 

Who should invest in DSP World Agriculture Fund? 

• Experienced Investors with a well-set core portfolio, looking to diversify no more than 10-15% of portfolio internationally. 
• Investors who strongly believe in the future growth potential of international agriculture-related companies and also have the sectoral understanding to ‘extract value’ from changing international agriculture sector cycles.  
• Investors looking for international diversification, especially in US companies & wanting to hedge portfolios. 
• Investors have the patience and mental resilience to remain invested for a decade or more and not look to chase the highest returns. 

Why invest in this fund? 

• Offers the potential to grow your wealth by investing in the global agriculture & agri-related sectors. 
• Get access to sector-leading companies that are difficult to invest in directly for Indian investors like Koninklijke DSM, Tractor Supply Company, Costco Wholesale Corp, Kerry Group, Nestle, etc.  

Time horizon 

• One should look at investing for a minimum of 10 years or even more. 
• Investment through Systematic Investment Plan (SIP) may help in tackling the volatility of the broader equity market. 

Conclusion 

The DSP World Agriculture Fund was launched in October 2011, and in its track record of eleven years, the fund has delivered ~6% CAGR consistently.

Thus, it is best for investors who are willing to take international equity exposure in the portfolio with an agriculture bias and wants to remain invested for a longer period.