Investors are increasingly finding it difficult to pick up quality stocks because of their high valuations.

In such a situation, it makes sense to be with mutual fund schemes that follow multi-cap focused scheme theme.

L&T Mutual Fund is launching a new mutual fund scheme on 15th October 2018 – L&T Focused Equity Fund.

It is an open-ended multi-cap focused scheme that will maintain a portfolio of no more than 30 stocks. This fund will follow a high conviction strategy focusing on a few stocks –It has the potential for great risk and great reward.

This is a reason why so many are looking up to this new L&T NFO.

Lets look into this NFO in detail.

L&T Focused Equity Fund NFO- Facts

L&T mutual fund is a premier mutual fund in India and caters to the investment needs through a suite of mutual fund schemes.

It recently announced the launch of L&T Focused Equity Fund – Direct Plan NFO.

NFO Name L&T Focused Equity Fund – Direct Plan NFO
NFO Launch Date 15th October 2018
Last Date for Application 29th October 2018
Minimum Initial Application Amount ₹5,000 and in multiples of ₹ 1 thereafter
Fund Type Focused Equity Scheme
Nature Open-ended fund
Load Structure Entry Load: Nil
Exit Load: 1% if redeemed within 1 year from the date of allotment
Fund Manager Mr. S.N. Lahiri and Mr. Vihang Naik
Benchmark Nifty 500 TRI Index

How Can You Invest in L&T Focused Equity Fund NFO 2018?

1.Log in to your Groww account.

2.If you are a new user, sign up first– the process is online and takes 2-3 working days.

How to invest in L&T Focused Equity Fund – Direct Plan NFO

1.Decide the amount you would like to invest in L&T Focused Equity Fund – Direct Plan NFO.

2.You can also email Groww support on support@groww.in with a request.

When investing in this NFO, you must remember that there is no entry load, but the exit load is 1%, if the units are redeemed/switched within 1 year from the date of allotment.

L&T Focused Equity Fund NFO – Objective

This fund seeks to generate long-term capital appreciation by investing in a concentrated portfolio of equity and equity related instruments (of maximum 30 stocks), debt Instruments and money market instruments.

But there is no assurance that the objective of this scheme will be realized and neither does the assure or guarantee consistent returns

L&T Focused Equity Fund NFO – Fund Category

L&T Focused Equity Fund – Direct Plan NFO is categorized as a multi-cap focused scheme which invests in equity and equity-related securities of maximum 30 stocks.

A focused mutual fund invests in a maximum of 30 stocks which are completely sector and market-cap agnostic. The entire strategy of such a fund is to hit a bull’s eye by investing in the right stocks to achieve a higher risk-return profile.

L&T Focused Equity Fund NFO is also an open-ended fund.

Open-ended funds are schemes that offer mutual fund units to the investors on a continuous basis.

This means that the investors can buy units from, or sell units to the fund house at any time. These funds also do not have a fixed maturity period.

The success of these funds depend on the amount of effort invested by the fund house in researching and finding the right dark horse stocks in the small, mid-cap and large-cap category

L&T Focused Equity Fund NFO – The Plans Available

The scheme offers the following plans: Regular Plan and Direct Plan

Both the regular and direct versions of any mutual fund are the exact same fund and are run by the same fund managers, investing in the same stock and bonds.

The difference is that in the case of direct mutual funds, there is no broker/distributor commission.

Which means, as an investor, you get higher returns from the exact same mutual fund.

Read More: Regular Plan V/S Direct Plan (Does It Really Matter?)

Additional Options

  • Growth Option
  • Dividend Option (with Payout and Reinvestment Facility – Regular, Monthly and Quarterly frequency)

L&T Focused Equity Fund NFO – Asset Allocation

Minimum investment in equity & equity related instruments has to be 65% of total assets.

This scheme retains the flexibility to invest its remaining assets in debt and money market instruments, subject to a limit of 35% and in units issued by REITs and InvITs up to a limit of 10%.

L&T Focused Equity Fund-Direct Plan NFO Equity Asset Allocation

Large cap stocks Mid cap Stocks Small Cap Stocks
Exposure weight 50%-70%  20%-30% 0% – 10%
Definition Top 100 companies in terms of market capitalization 101st to 250th companies in terms of market capitalization 251st companies on wards in terms of market capitalization

Note: For complete details of the asset allocation pattern, refer the Scheme Information Document (SID) of the particular scheme.

L&T Focused Equity Fund NFO – Benchmark

The fund will be bench-marked to Nifty 500 TRI Index.

The NIFTY 500 represents the top 500 companies based on full market capitalization and average daily turnover from the eligible universe.

It represents about 94% of the free float market capitalization of stocks listed on NSE as on March 31, 2016.

L&T Focused Equity Fund NFO – Fund Manager

This fund will be managed by:

1. Mr. Soumendra Nath Lahiri

He is a highly experienced fund manager and holds a total experience of 28 years and is also currently leading the L&T Investment Management Limited in the capacity of its Chief Investment Officer.

Education: Mr. Lahiri is a B.Tech and PGDM from IIM Bangalore.

Experience: Prior to joining L&T Mutual Fund, he has worked with Canara Robeco AMC Co. Ltd., Emkay Investment Managers Ltd, Fortuna Capital, DSP Black Rock Investment Managers Pvt. Ltd.

Funds Managed:

  • L&T Equity Fund – since Nov 2012
  • L&T Hybrid Equity Fund – since Nov 2012
  • L&T Infrastructure Fund – since Nov 2012
  • L&T Large and Midcap Fund – since Nov 2012
  • L&T Tax Advantage Fund – since Nov 2012
  • L&T Midcap Fund – since Jun 2013
  • L&T Emerging Businesses Fund – since Apr 2014

Mr. Vihang Naik

Education: Mr. Naik is a CFA and TYBMS.

Experience: Prior to joining L&T Mutual Fund, he was associated with L&T Investment Management Limited (Jul 2012-Jun 2016) as an Analyst and with MF Global Sify securities (Mar 2010-Jul 2012, Motilal Oswal Securities (May 2008-Mar 2010), SBICAP Securities (Oct 2006-Apr 2008) as Research Analyst.

Funds Managed:

  • L&T Midcap Fund – since Jun 2016
  • L&T Long Term Advantage Fund – I – since Oct 2016
  • L&T Emerging Opportunities Fund Series I – Regular Plan – since Jan 2018
  • L&T Emerging Opportunities Fund Series II – Regular Plan – since Jun 2018

L&T Focused Equity Fund NFO – Minimum Investment

  • Lump sum: Rs.5,000 per application and in multiples of Re.1 thereafter
  • SIP: Rs.500 (minimum 6 monthly installments or minimum 4 quarterly installments) ₹5,000 and in multiples of ₹1/- thereafter

Minimum Additional Purchase Amount: ₹5,000. For subsequent purchases, ₹1,000.

Note: The minimum application amount is applicable only at the time of creation of new folio and at the time of first investment in a plan

L&T Focused Equity Fund NFO – Risk

L&T Focused Equity Fund NFO falls in the moderately high-risk category as per the company scheme information document.

This indicates that the principal invested by the investors will be moderately high risk.

Some risks associated with the fund are trading volumes, settlement risk, liquidity risk, default risk including the possible loss of principal.

The fund is an equity oriented hybrid fund and therefore, it is less volatile when compared to pure equity funds and more volatile than pure debt mutual funds, due to its exposure to high performing equities.

These funds have given high returns on investments as compared to debt funds.

It is best suited to investors with a moderate risk appetite or for long-term investors.

L&T Focused Equity Fund NFO – Important Features

Following are some of the salient feature of L&T Focused Equity Fund NFO

  • Multi-cap Portfolio Strategy – Market cap agnostic with no bias for sector calls;
  • Aimed to deliver higher alpha, albeit at an added risk;
  • Ability to perform in a polarized as well as a normal market;
  • Bottom-up stock selection using our proprietary G.E.M investment approach;
  • Spotting companies with scalable opportunities, competent management, strong corporate governance practices and balance sheet;
  • Focus on risk management on an ongoing basis

L&T Focused Equity Fund NFO- AMC Details

Key Information

Mutual Fund L&T Mutual Fund
Setup Date 3rd January 1997
Incorporation Date 25th April 1996
Sponsor L&T Finance Holdings Limited
Trustee L&T Mutual Fund Trustee Limited
Chair Person NA
CEO / MD Mr. Kailash Kulkarni
Assets Managed Rs. 73752.54 crore (Sep-30-2018)

L&T Mutual Fund is a mutual fund company in India.

It caters to the investment needs of investors through various mutual fund schemes. The company claims to have a sound investment management practice and a knowledgeable fund management team.

The Asset Management Company (AMC) for all L&T Mutual Fund schemes is L&T Investment Management Limited. The sponsor for the AMC is L&T Finance Holdings Limited (LTFH) which is a listed company and registered with RBI as an NBFC.

A robust monitoring and risk management process ensures checks and balances at every stage. 

Key Reasons to Invest in L&T Focused Equity Fund NFO

1.In times when markets witness volatility, a concentrated portfolio ‘focused’ only on picking winners, provides ample scope for ‘above-average’ returns.

2. Only a few companies with quality management and strong earning tend to outperform the index significantly every year.

3. The expertise of the fund manager and equity investment process is very critical in managing a focused portfolio that helps to identify such companies.

This makes the fund extremely methodical and strives to choose the best possible investments, which can work in the investor’s favor to potentially deliver higher alpha over the long-term.

4. We all know that the main aim of mutual funds is to provide optimal diversification. But beyond a limit, diversification becomes pointless and may lead to lower returns.

With higher returns, comes higher risk (losses) too. Too much concentration on few stocks can hit the bull’s eye or miss the target completely.

Read More: NFO Review: Axis Growth Opportunities Fund NFO

Investing in mutual funds online is simple and paperless. Simply log in to your Groww account, choose a fund, and invest using net banking – exactly like you would when shopping online.

Happy Investing!

Disclaimer: The views expressed in this post are that of the author and not those of Groww