Learn about the Axis Build India Fund, a mutual fund targeting companies involved in creating real assets. Understand its objectives, asset allocation, and benefits to decide if it aligns with your investment goals.
The Axis Build India Fund is a thematic, open-ended equity mutual fund that focuses on investing in companies involved in creating or supporting the development of real assets. If you’re an investor looking to add value through infrastructure and tangible asset investments, this fund could offer an appealing growth opportunity. Here’s everything you need to know.
The Axis Build India Fund is designed for long-term capital appreciation through investment in equities and equity-linked securities of companies engaged in infrastructure and asset creation, including sectors like real estate, logistics, and transportation. Managed by Axis Asset Management Company Ltd., this fund aims to support economic growth by focusing on companies that contribute to tangible developments.
Key Objectives of the Fund
The primary objective of the Axis Build India Fund is long-term capital appreciation. By targeting businesses that are active in the creation of real assets, the fund aligns with India’s infrastructure goals, providing investors with a way to capitalize on the growth potential within these sectors.
Investment Objective
The fund invests in a diversified portfolio of equities, primarily targeting companies that enable and participate in tangible asset creation. However, like most equity investments, there is no guaranteed return on investment, as fund performance is subject to market conditions and underlying asset values.
Fund Structure and Asset Allocation
The fund’s asset allocation strategy emphasizes 80-100% investment in equity and equity-linked instruments related to real assets. Here’s a breakdown of its typical allocation:
- Equity & Related Instruments: 80-100%
- Other Equity Instruments: 0-20%
- Debt & Money Market Instruments: 0-20%
- REITs and InvITs Units: Up to 10%
This allocation allows the Axis Build India Fund to remain flexible and respond to market conditions while maintaining a thematic focus on infrastructure and real assets.
Understanding the Benchmark
The fund uses the Nifty 500 TRI as its primary benchmark, as this index tracks the top 500 companies across all market capitalizations (large-cap, mid-cap, and small-cap) in India. This broad benchmark aligns with the fund’s diverse portfolio structure, offering a fair measure of performance.
Where Will The Scheme Invest
The Scheme will invest in following instruments:
- Equity & Equity related instruments
- Derivatives
- Debt instruments & Money Market instruments
- Units of REITs and INVITs
- Securitized Assets
- Units of Mutual Fund Schemes
- Repo in corporate debt securities
- Short Term Deposits
How Does the Fund Choose Investments?
The Axis Build India Fund takes a bottom-up approach to stock selection. This approach includes analyzing companies for their contribution to asset creation and their long-term value growth. The fund manager looks for stocks across market capitalizations, focusing on sectors like:
- Oil, Gas, & Consumable Fuels
- Power and Renewable Energy
- Metals and Mining
- Construction and Real Estate
- Logistics and Transportation
This approach ensures a balanced exposure to both direct asset creators and enablers, such as financial institutions and infrastructure service providers.
Risk Factors and Mitigation Strategies
While the fund aims for growth through strategic asset investments, it’s essential to recognize its associated risks. Here are some primary risk factors and the fund’s mitigation strategies:
- Market Risk: The fund is vulnerable to general stock market fluctuations. Diversification across various sectors helps manage this risk.
- Concentration Risk: Since it focuses on asset-creating sectors, there’s a potential for concentrated sector risk. However, spreading investments across multiple sectors and market capitalizations reduces the impact.
- Liquidity Risk: The fund maintains liquidity by investing in short-term debt instruments when necessary.
Axis AMC adheres to SEBI’s regulations and employs risk controls to protect investors while maintaining the potential for returns aligned with the fund’s investment objectives.
Who Manages the Axis Build India Fund?
Managed by experienced professionals at Axis Asset Management Company, the fund benefits from deep sectoral knowledge and investment expertise. The asset managers ensure that all investments align with the fund’s objectives, balancing risk and return through active portfolio management.
| Name of Fund Manager | Age and Qualification | Experience of the Fund Manager | Names of Other Schemes Under His Management |
|---|---|---|---|
| Sachin Relekar | Age: 49 years Qualifications: Master of Management Studies – Mumbai University | Total number of years of experience: 22 Years Axis Asset Management Company Limited – from 24-01-2024 to till date LIC Mutual Fund Asset Management Company Limited – From 02-12-20 to 23-01-24 LIC Mutual Fund Asset Management Company Limited – From 02-12-12 to 01-12-20 | Axis Focused Fund Axis Flexi Cap Fund Axis NIFTY Next 50 Index Fund Axis Value Fund Axis NIFTY 500 Index Fund Axis Build India Fund |
| Shreyash Devalkar | Age: 45 years Qualifications: Bachelor in Chemical Engineering & Master in Management Studies | Total number of years of experience: 19 years Fund Manager – Axis Asset Management Co. Ltd. (November 16, 2016 till date) Vice President – Research – IDFC Asset Management Company Ltd. (July 24, 2008 till January 14, 2011) Fund Manager – BNP Paribas Asset Management India Pvt. Ltd. (January 17, 2011 till November 15, 2016) Research Analyst – IDFC Securities Ltd. (September 07, 2005 till July 23, 2008) | Axis Bluechip Fund Axis ELSS Tax Saver Fund Axis Midcap Fund Axis Growth Opportunities Fund Axis ESG Integration Strategy Fund Axis India Manufacturing Fund Axis NIFTY Healthcare ETF Axis Equity ETFs FoF Axis Multicap Fund Axis Consumption Fund |
Who Should Consider Investing in the Axis Build India Fund?
This fund suits investors seeking long-term growth with a willingness to invest in sectors contributing to India’s infrastructure. If you have a moderate to high-risk tolerance and a 5-10 year investment horizon, the Axis Build India Fund may align well with your financial goals. It’s particularly suited for those looking to diversify with exposure to infrastructure and real asset sectors, which are anticipated to grow alongside India’s economic development.
How to Invest in the Axis Build India Fund
Impact of Expense Ratio on Scheme’s return:
Expense ratio, normally expressed as a percentage of Average Assets under Management, is calculated
by dividing the permissible expenses under the Regulations by the average net assets.
To further illustrate in rupee terms the above, for the Scheme under reference, suppose an Investor invested
Rs. 10,000/- (after deduction of stamp duty and transaction charges, if any) under the Growth Option, the
impact of expenses charged will be as under:
| Sr. No. | Particulars | Regular Plan (Rs.) | Direct Plan (Rs.) |
|---|---|---|---|
| A | Amount invested at the beginning of the year | 10,000 | 10,000 |
| B | Returns before expenses | 1,500 | 1,500 |
| C | Expenses other than the expenses mentioned in ‘D’ below | 50 | 50 |
| D | Marketing & Selling expenses incl. agent commission | 150 | 0 |
| E | Returns after expenses at the end of the year [B – (C + D)] | 1,300 | 1,450 |
| F | Returns after expenses at the end of the year (in %) [(E/A)] | 13% | 14.5% |
Investors can subscribe to units through:
- Direct Investment with Axis Mutual Fund (bypassing distributors).
- Regular Plans via registered distributors for those who prefer guidance.
Minimum investment amounts are Rs. 100 for both new and additional investments, allowing flexibility for beginners and seasoned investors alike.
Fees and Charges
Understanding the fee structure is essential before committing to the fund. The Axis Build India Fund has the following fee breakdown:
- Entry Load: None
- Exit Load: 1% if units are redeemed within 12 months for amounts exceeding 10% of total investments; 0% if held beyond 12 months.
These fees are relatively standard, ensuring that most of your investment is put towards growth rather than charges.
Systematic Investment Plan (SIP) and Withdrawal Options
The fund offers several flexible investment and withdrawal options, including:
- SIP: Invest as little as Rs. 100 monthly, offering a disciplined approach.
- SWP (Systematic Withdrawal Plan): Allows regular withdrawals for a more flexible income stream.
These options make the Axis Build India Fund accessible for investors with varying financial needs and goals.
Final Thoughts
The Axis Build India Fund presents a unique opportunity for investors looking to support and benefit from India’s infrastructure growth. With a strategic focus on sectors involved in real asset creation, this fund is well-positioned for those seeking long-term capital appreciation. However, as with any investment, it’s important to consider your risk tolerance and financial goals. If you’re ready to invest in India’s future infrastructure, the Axis Build India Fund could be a suitable addition to your portfolio.
Please consult with your financial advisor before making any investment decisions. This information is sourced from SEBI.
