The Baroda BNP Paribas India Consumption Fund
The Baroda BNP Paribas India Consumption Fund – Regular Plan is an equity mutual fund that focuses on the consumption theme in India. It aims to invest in companies that benefit from domestic consumption trends, including sectors like FMCG, automobiles, and consumer durables. It falls under the “thematic” category, making it a high-risk, high-return investment, suitable for long-term investors seeking exposure to India’s growing consumption story.
- NAV: As of the most recent update, the Net Asset Value (NAV) of the Regular Plan (Growth option) is ₹33.63 .
- Returns: Over a 5-year period, the fund has delivered a return of around 22.12% annually.
- Risk: The fund carries high risk, reflected in metrics like a beta of 0.74, indicating moderate volatility compared to the market. It also has a Sharpe ratio of 1.13, showing good risk-adjusted returns.
- Minimum Investment: You can start investing with a minimum of ₹500 .
This, the Baroda BNP Paribas India Consumption Fund is managed by experienced professionals and is suitable for investors who have a higher risk tolerance and a long-term investment horizon.
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Here’s more detailed information about the Baroda BNP Paribas India Consumption Fund – Regular Plan:
1. Fund Overview
- Category: Equity – Thematic Consumption Fund
- Fund Objective: The fund primarily invests in sectors driven by consumption in India, such as fast-moving consumer goods (FMCG), auto, consumer durables, and retail. It aims to capture growth from the expanding consumption patterns in India due to rising income levels and urbanization.
2. Performance & Returns
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Historical Performance:
- 5-Year Return: ~22.12% CAGR (compounded annual growth rate).
- 3-Year Return: Around 24.95% annually.
- Since Inception: The NAV has appreciated steadily, with the latest NAV being ₹33.63.
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Performance Ratios:
- Alpha: -0.52 (underperforming its benchmark, which could be due to short-term market volatility or stock selection).
- Beta: 0.74 (suggesting less volatility than the overall market).
- Sharpe Ratio: 1.13 (indicating that it offers a good risk-adjusted return).
3. Risk Factors
- As a thematic fund, it carries higher risk due to its concentrated exposure to consumption-driven sectors. However, it offers potentially high rewards in a growing economy like India.
- Volatility: With a standard deviation of 12.04, the fund can experience considerable price swings.
4. Portfolio Composition
- Top Holdings: The fund typically invests in large consumption-oriented companies. Common sectors include FMCG, automotive, healthcare, and financial services.
- Sector Allocation: The fund is heavily weighted towards sectors benefiting from domestic consumption, making it sensitive to economic cycles.
5. Who Should Invest?
- This fund is suitable for investors with a long-term investment horizon who believe in India’s consumption growth story and are willing to accept the higher risk involved with thematic investments.
- It’s a good fit for those who already have diversified portfolios and are looking to add a focused sector play to their strategy.
6. Minimum Investment & SIP
- Minimum Lumpsum Investment: ₹500.
- SIP (Systematic Investment Plan): Available for those looking to invest smaller amounts regularly.
Who Should Invest?
- Long-Term Investors: Those who have a long-term investment horizon and wish to capitalize on the growing consumption trend in India.
- Thematic Investors: Investors who want to focus specifically on consumption-oriented stocks as part of their portfolio.
- Moderate to High-Risk Tolerance: As the fund has concentrated exposure to the consumption sector, it is suitable for investors who can handle market volatility and sector-specific risks.
Conclusion:
The Baroda BNP Paribas India Consumption Fund is an excellent option for investors looking to benefit from India’s consumption-led growth story. By focusing on companies poised to grow with the rise in consumer spending, the fund aims to deliver long-term capital appreciation. However, like any thematic fund, it comes with risks associated with sector concentration, making it ideal for investors with a higher risk appetite and long-term investment outlook.
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