HDFC Housing Opportunities Fund - NFO - Rating & Review - Don't Invest

HDFC Housing Opportunities Fund – NFO – Rating & Review – Don’t Invest

Roboadviso     Mutual Funds Rating     Posted On, Wed 22nd November, 2017     No comments
Rate
  • Editor Rating
  • Rated 1 stars
  • 20%

  • HDFC Housing Opportunities Fund
  • Reviewed by:
  • Published on:
  • Last modified: November 22, 2017
  • Product Idea
    Editor: 0%
  • Fund House
    Editor: 100%
  • Fund Manager
    Editor: 50%
  • Performance
    Editor: 0%
  • Consistency
    Editor: 0%
  • Risk
    Editor: 25%
  • Expense Ratio
    Editor: 0%

HDFC housing Opportunities fund rating review

HDFC AMC has recently opened the New Fund Offer (NFO) for HDFC Housing Opportunities Fund. The last date for investment in 30/11/17. The Rating & Review of Fund is as under:

About the Fund:

  • HDFC Housing Opportunities Fund is a 1140 days close-ended thematic equity offering investing a minimum of 80% into equities of housing and allied businesses.
  • Housing theme would predominantly include industries including Cement, Engineering-Designing-Construction, Banks, Housing Finance, Steel, Paints, Construction, Home appliances, Plywood, Sanitary ware, Tiles, etc. Hence, a diversified basket to choose stocks from.
  • Benchmark: A custom-made benchmark by IISL (NSE) called India Housing and Allied Businesses Index, a 50 stock index that currently includes 14 basic industries.
  • Why housing theme:
    1. Acute shortage for housing in India
    2. Favorable demographics, urbanization and shift toward nuclear households.
    3. Government focus on affordable housing.
    4. Improved affordability on account of stable house prices, increase in income levels and a drop in interest rates.
    5. Multiple macro-economic linkages to foster growth in allied industries, thereby boosting economic growth.
    6. HDFC Housing Opportunities Fund to focus on businesses that would benefit from the expected growth in housing.
  • Fund Manager: Mr. Srinivas Rao Ravuri
  • NFO Period: 16th to 30th November 2017.

Analysis:

  • The fund is not a diversified equity fund. Focuses on particular theme which may or may not do well in future. Its always good to invest in diversified fund where fund manager has mandate to select or change the theme of fund based on outlook of economy.
  • The fund is not open ended which means investor will not be able to exit if there is under performance. Investors have to stay locked with the fund
  • Existing equity diversified funds with track record are also covering this theme with a focus of creating wealth. Its better to invest in funds with good track record.
  • Since it is an NFO, therefore there is no track record of this scheme.
  • The Fund Manager has decent track record but nothing great to talk about.

Final Verdict – the fund doesn’t offers anything new. Its a marketing gimmick to get more money from investors. It is recommended to not invest in this fund – Don’t Invest

 

Pros

Excellent Fund House

Cons

No Performance Track Record
Thematic without enough Diversification
Average Fund Manager
High Expense Ratio
Close Ended – No Liquidity

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