PGIM India Small Cap Fund NFO
PGIM India Mutual Fund has announced the launch of the PGIM India Small Cap Fund. The scheme would be predominantly investing its assets in equity and equity-related securities of small cap companies.
The New Fund Offer (NFO) starts on 09th July 2021 and will end on 23rd July 2021.
Investment Objective
The scheme’s investment objective is to generate long-term capital growth by investing its assets in equity and equity-related securities of small-cap companies.
Features
- The fund will be investing a minimum of 65% of its assets in the equity and equity-related securities of small-cap companies.
- The fund may allocate up to 35% of its asset across the market cap, debt, or money market instruments.
- Fund will use the GARP (Growth At Reasonable Price) philosophy for the stock selection.
- The fund will focus on ROE, growth, FCF, and leverage ratios of the stocks.
PGIM India Small Cap Fund - Eligible Investment Universe
Funds will use 3 factors for the inclusion of the stocks in the investment universe.
- Operating cash flows of the stocks should be positive for 7 out of 10 years.
- Company should have demonstrated corporate governance.
- Debt to equity ratio should be less than 3.
PGIM India Small Cap Fund - Investment Framework
1. Respect for Capital
The strong focus will be Return on Capital Employed (ROCE) and Return on Equity (ROE).
2. Operating Leadership
Fund will include stocks that are a leader or competent challenger in its operating space.
3. Sector Dominance
Fund will favor the industries which are gearing up for consolidation and will avoid the industries which are slated for fragmentation.
4. Solid Financials
The stocks should have conservative debt, positive operating cash flows, and strong projected cash flow generation.
5. Governance
Fund will evaluate the ongoing ESG based factors for all the stocks in the universe.
Who Should Invest?
This scheme is suitable for investors who are -
- Interested in long-term capital growth.
- Investors who want to invest in small-cap companies.
- Recommended for investors with an investment horizon of 5 years & above.
Asset Allocation Pattern
| Instruments | Minimum % of total assets (Indicative) | Maximum % of total assets (Indicative) |
| Equity and Equity-related securities of Small-cap companies | 65% | 100% |
| Other equity and equity-related securities | 0% | 35% |
| Debt & money market instruments, units of debt mutual funds | 0% | 10% |
About the Scheme
| Name of the fund | PGIM India Small Cap Fund NFO |
| Fund launched by | PGIM India Mutual Fund |
| Asset Management Company | PGIM India Asset Management Private Limited |
| Type of scheme | An open-ended equity scheme primarily investing its assets in small cap companies. |
| Investment Objective | The scheme’s investment objective is to generate long-term capital appreciation by investing its assets in equity and equity-related securities of small cap companies |
| Benchmark | Nifty Small cap 100 TRI |
| Entry Load | Not Applicable |
| Exit Load | -Redemption of 10% units within 1 year - NIL -Redemption of more than 10% of units within 1 year - 1% -Redemption of units after 1 year - NIL |
| Taxation | Taxed as Equity -If units are redeemed within 12 months, gains are taxed as short term capital gain tax @15% -If units are sold after 12 months, gains are taxed as long term capital gain tax @10% on the gains exceeding ₹ 1 lakh in a financial year |
| Minimum Application Amount | ₹ 5,000 & in multiples of ₹ 1 thereafter |
| Minimum Additional Amount | ₹ 1,000 & in multiples of ₹ 1 thereafter |
| STP & SWP | Available |
| Plans Available |
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| Options |
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| Fund Managers | Mr. Aniruddha Naha (Equity securities), Mr. Kumaresh Ramakrishnan (Debt instruments), and Mr. Ravi Adukia (Overseas investments) |
SIP Details
| Type | Minimum Amount |
| Monthly SIP | ₹1,000 & in multiples of ₹1 thereafter |
| Quarterly SIP | ₹1,000 & in multiples of ₹1 thereafter |