UTI Mastershare

UTI Mastershare Unit Scheme: Who should invest?

UTI Asset Management Company (AMC)

UTI is one of the pioneers of the Indian Mutual Fund Industry.

With over Rs 2.4 lakh crore, the AMC is one of the most trusted names in the mutual fund space. The AMF offers products across asset classes.

Let us talk about its flagship product – UTI Master share Unit Scheme 

About Fund 

1. Investment objective

The fund seeks to generate long-term capital appreciation for investors by investing in equity and related securities of large-cap companies.

It is India’s first equity-oriented fund launched in October 1986.  

2. Investment process  

The Fund takes a top-down view of the sector and then takes a bottom-up approach to select the stocks within the sectors. The fund is a well-diversified portfolio and avoids sector as well as stock concentration. 

UTI-mastershare-investment-process

3. Portfolio Composition 

The portfolio holds the major exposure in large-cap stocks at 87% and sectorally major exposure is towards financial services which account for roughly one-third of the portfolio. The top 5 sectors hold nearly 63% of the portfolio.  

UTI-mastershare-portfolio-composition
Note: Data as of 30th Sep 2022. 
Source: UTIMF 

Top 5 Holdings 

Name Sector Weightage % 
ICICI Bank Financial Services 9.52 
Infosys Information Technology 7.12 
HDFC Financial Services 6.12 
Bharti Airtel Telecom 4.52 
Reliance Oil and Gas 3.93 
Note: Data as of 30th Sep 2022. 
Source: UTIMF 

Fund performance over 35 years 

If you would have invested 10 lakhs at the inception of the fund, it would be now valued at Rs 18.20 crore whereas the benchmark (S&P BSE 100) would have fetched you Rs 11.88 Crore

UTI-mastershare-fund-performance-over-35-years
Note: Performance of the fund since launch; Inception Date – October 15, 1986. 
Source: utimf.com 

The fund has given consistent returns and has outperformed the benchmark over the period of 35 years by generating a CAGR (Compounded Annual Growth Rate) of 15.56%

Now, let’s look at the fall of the fund during market corrections.

Source: utimf.com

The above table explains that the fund has seen less fall/correction compared to the market correction.

While corrections are painful for the short-term investor, at the same time, it is an opportunity to make higher returns for the long-term investors. 

Fund manager 

The fund is managed by Swati Kulkarni and Karthikraj Lakshmanan. Swati has over 36 years of experience and has been managing the fund since December 2006.

Karthikraj has over 17 years of experience and is a new entrant in this fund management. 

Who should invest in UTI Mastershare unit scheme? 

Investors looking to 

  • Own large-cap businesses with sound management, steady cash flow, and earnings growth 
  • Build core equity portfolio for long-term wealth creation with steady growth 

Why invest in the UTI Mastershare unit scheme? 

  • India’s first equity-oriented fund with a proven track record of over 35 years and over Rs 10,000 crore in Assets Under Management currently. 
  • Strong stock selection approach with a diversified portfolio reducing concentration risk 

Horizon 

  • One should look at investing for a minimum of 5 years or more 
  • A systematic investment Plan (SIP) is an ideal way to take exposure as it helps tackle market volatility 
Conclusion 

The fund is the oldest fund with a proven track record of 35 years and has delivered 15.56% CAGR consistently. Thus, suitable for even first-time equity investors who are looking to take a little higher risk

Disclaimer

This is not recommendation advice. All information in this blog is for educational purposes only.

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