Hyderabad Investment：Uncover opportunities of top mutual funds in India (Fund Digest May 2024)

Economic resilience and potential for sustained long-term growth have been the two drivers behind India’s remarkable stock market performance, with MSCI India (USD) returning 8.58% since the beginning of 2024 through April. The market outperformed its emerging market counterparts and the broader indices. The market’s longer-term performance has been impressive as well.Hyderabad Investment

Source: Endowus Research, Bloomberg, Monthly Returns in USD.

Despite the stellar long-term returns, the recent economic and investment environment in India was not without volatility. Post-Covid-19 pandemic recovery contributed to its rebound in 2021. Sectors like information technology and industrials led the charge. The path was not smooth, though. The threat of new variants of the COVID-19 virus, inflationary pressures, and geopolitical tensions arising from the Russian-Ukraine conflict introduced market fluctuations.Kanpur Wealth Management

Collectively, the events triggered global commodity price surges, impacting India’s inflation rates and testing the markets’ resilience. Uncertainties also propelled stylistic rotation to value stocks reflecting a defensive preference of investors. But these uncertainties have not deterred investor interest in the top mutual funds in India, as we outline below.

Forward to 2023, Indian equity markets were challenged by the Adani-Hindenburg Row, the El Nino Scare, and more.

The Adani-Hindenburg Row: The Adani Group is an Indian conglomerate, engaged in energy, logistics, oil and food, and more operations. The allegations by short-seller Hindenburg Research against the Adani Group in January 2023 on the improper use of tax havens and stock manipulation led to significant market volatility, particularly affecting the conglomerate❼stocks and raising broader concerns about corporate and market transparency in India. This event prompted investors to reassess risk and governance frameworks within their investment strategies.

El Niño Scare: The potential impact of El Niño on India’s monsoon season added another layer of uncertainty, with concerns about its implications on agriculture, inflation, and overall economic growth. As agriculture remains a critical sector for India, the El Niño scare underscored the importance of climate resilience and sustainability in investment considerations.

Nonetheless, companies within the renewable energy and digital infrastructure space emerged stronger, benefiting from global trends and supportive domestic policies.

India❼growth narrative is compelling, underpinned by a younger demographic, reform-oriented governance, and a robust corporate landscape. With approximately 110 million individuals set to join the workforce by 2030 and a median age significantly younger than its global counterparts, India is poised for a demographic dividend that promises to boost labour supply, productivity, and consumption. Furthermore, the government’s reform agenda, including significant tax cuts and labour law rationalisations, has improved the investment climate, making India an attractive destination for both domestic and foreign investors.

The resilience of the Indian market in the face of these adversities highlights the underlying strength of India❼economy and the diverse opportunity set available to investors. Investors looking to participate in India’s growth via an investment in Indian equities can consider these funds as a satellite allocation. Out of the top mutual funds in India, a carefully curated selection of India-themed equity funds is available on the Endowus Fund Smart platform, including the newly launched Ashoka WhiteOak India Opportunities Fund.

ISIN: IE0007ER59W1 (SGD, Cash), IE00BDR0R792 (USD, Cash)

Led by a deeply experienced portfolio manager with a stellar track record in consistently delivering alpha across cycles, this fund places emphasis on small- and mid-cap and private sector companies within India, aiming to capitalise on high alpha opportunities.

It uniquely positions itself by underweighting select sectors such as energy and utilities, a function of governance and regulatory concerns. The fund’s approach is underpinned by a disciplined, bottom-up stock selection process, leveraging the extensive experience of a Mumbai-based team for deep market insights.

ISIN: LU2032729951 (SGD, Cash), LU0333810181 (USD, Cash)

Goldman Sachs India Equity Portfolio focuses on delivering long-term capital appreciation by investing in companies with robust fundamentals and strong ESG practices. The fund presents a diversified portfolio spanning 70-100 names, offering comprehensive exposure to India Equities across sectors and market capitalizations, with a tilt towards small and medium-sized companies.

Led by Hiren Dasani, the India Equity research team drives strong and consistent performance through meticulous stock selection, consistently outperforming its reference index over various periods. Grounded in a philosophy emphasising business and valuation, the fund❼robust investment process combines bottom-up fundamental research with cash flow-based analysis to identify companies with sustainable high returns on capital investment.

Despite experiencing management changes several years ago, the fund❼performance has consistently outperformed over multiple periods, showcasing its resilience and strategic adaptability across cycles.

ISIN: IE00B7N09G41 (SGD, Cash, CPF, SRS)

PineBridge India Equity Fund adopts an active strategy, which is a fundamental- and research-driven, high-conviction approach. The portfolio comprises 30 to 40 stocks with a medium to long-term investment horizon.  The fund’s strategy is also marked by a blend of quality and valuation analysis, aiming for long-term asset growth through investments in companies with strong management and business modelsJaipur Wealth Management. The fund emphasises conservative investment choices to achieve robust long-term returns with a lower risk profile.

It is managed by veteran portfolio manager Elizabeth Soon, the Head of Asia ex-Japan Equities with over 30 years of investing experience. She works closely with and is further supported by Pinebridge’s on-the-ground Indian team. The fund’s equity research process, also known as Lifecycle Categorization Research , is a framework that unlocks alpha opportunities by capturing the dynamic nature of a company’s growth outlook beyond market-consensus views.

ISIN: IE000ZP310H0 (SGD, Cash), IE00BYPC7R45 (USD, Cash)

Managed by UTI Asset Management, one of India’s largest and pioneering asset management companies, this fund provides investors with exposure to growth-oriented companies across various market capitalisations, particularly those poised to benefit from India❼consumption story.

Ajay Tyagi is at the helm of portfolio management and the fund is noted for its long-term investment focus, low portfolio turnover, robust quality filter and emphasis on mid and small-cap stocks.

Whether you’re looking to invest your cash, CPF, or SRS, there’s something for everyone at Endowus. Want to explore the funds available on our Fund Smart platform? Refer to our investment funds list here in a single glance.

The Endowus Fund Smart platform comes with wide currency selection and dividend payout options. These give you more flexibility and information in selecting your own funds and building your own portfolios. You can transfer your funds from other banks or platforms into Endowus, saving you up to 65% or more on your fees.

Customise your ideal investment portfolio in minutes with Fund Smart. The Endowus Fee for Single Fund Goals via Fund Smart (Cash, CPF, and SRS) is 0.3% p.a., reinforcing our commitment to reduce the cost of investing. This pricing means that more than 95% of the funds are now cheaper on Endowus than on any other fund platform, bank, private bank, financial advisor, or broker in Singapore.

Not sure how to invest with Fund Smart? Find out everything you need to know in our FAQs.

‍*Annualised returns are calculated based on the returns of the target share class, and the oldest share class of the fund where the target share class is younger than three years. Three-year returns are based on the period from May 2021 to April 2024 unless otherwise stated. Returns are translated into SGD (except for non-SGD funds) and are net of fund-level fees.

**Where a fund or portfolio has both SGD and USD share classes, the fees of the SGD share class are shown. Total portfolio and fund-level fees include fund total fund-level fees.

***Endowus does not charge a preliminary sales charge or any other additional fees, other than the all-in Endowus Fee.

Ahmedabad Wealth Management