NFO Alert: PGIM India Mutual Fund launches PGIM India Large and Midcap Fund; all you need to know

PGIM India Mutual Fund announced the launch of the PGIM India Large and Midcap Fund, an open-ended equity scheme investing in both large-cap and mid-cap stocks.

The scheme opened for public subscription on January 24, 2024, and will close on February 07, 2024. The scheme re-opens for continuous sale and repurchase within five business days from the date of allotment.

What kind of a mutual fund scheme is this?

This is an open-ended equity scheme investing across large-cap and mid-cap stocks. This product is suitable for investors seeking

• Long-term capital growth
• Investment in equity and equity-related securities of predominantly large-cap and mid-cap stocks.

Speaking on the new fund offer, Vinay Paharia, CIO, PGIM India Mutual Fund, said, “There is a continuing opportunity for investing in high growth and good quality large and mid-cap companies which can take advantage of the India growth story. Such companies can continue to compound capital at a rapid pace in a capital-efficient manner for a long period.”

What is the main objective of investing in this fund?

The investment objective of the scheme is to seek long-term capital growth through investments in equity and equity-related securities of predominantly large-cap and mid-cap stocks. However, there can be no assurance that the investment objective of the scheme will be achieved.

How may one invest in this scheme?

Investors can invest under the scheme with a minimum investment of ₹5,000 per plan/option and in multiples of Re 1. There is no upper limit for investment.

Under normal circumstances, the asset allocation of the scheme will be as follows:

Are there similar mutual funds in the market?

To date, many asset management companies (AMCs) have launched such large and midcap mutual funds. Some of these include:

How will the scheme benchmark its performance?

The benchmark for the scheme is NIFTY LargeMidcap 250 index TRI.

The NIFTY LargeMidcap 250 reflects the performance of a portfolio of 100 large-cap and 150 mid-cap companies listed on NSE, represented through the NIFTY 100 and the NIFTY Midcap 150 index respectively. This index intends to measure the performance of large and mid-market capitalisation companies with the aggregate weight of large-cap stocks and mid-cap stocks being 50% each, reset every quarter.

The NIFTY LargeMidcap 250 is designed to reflect the behaviour and performance of the entire large and mid-capitalised segment of the financial market. Since the equity investments in this particular fund are identified to cover both the large and the mid-market cap, this Index is most suited for comparing the performance of the scheme. Hence, it is an appropriate benchmark for the scheme. The Total Return (TR) Version of the index will be used for performance comparison.

The Trustee/AMC reserves the right to change the benchmark for evaluating the performance of the scheme from time to time, in conformity with the investment objective of the scheme and the appropriateness of the benchmark, subject to SEBI guidelines and other prevalent guidelines

Are there any entry or exit loads to this scheme?

This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” would be charged as per the following:

For each purchase of units through Lumpsum / switch‐in / Systematic Investment Plan (SIP) and Systematic Transfer Plan (STP), the exit load will be as follows:

• For exits within 90 days from the date of allotment of units: 0.50%;
• For exits beyond 90 days from the date of allotment of units: NIL

The AMC shall not charge any load on units allotted on reinvestment of IDCW for existing as well as prospective investors.

Who will manage this scheme?

Vinay Paharia, Anandha Padmanabhan Anjeneya, and Utsav Mehta are the equity fund managers for the scheme, Puneet Pal is the debt fund manager for the scheme and Ojasvi Khicha will manage the overseas investments for the scheme.

Does the fund contain any inherent risk?

The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.