What Made HDFC Manufacturing Fund The Third Largest Fund Launch Ever In India

HDFC Manufacturing Fund became the country's third largest new fund offering after receiving Rs 9,563 crore in its launch month, accounting for close to half of the net flows received in the sectoral and thematic categories.

The record demand was seen as the 'Make in India' theme remained at the forefront of investible ideas ahead of the Lok Sabha elections in June and the final budget in July.

The fund also benefited from investors who had been aiming to capitalise on the street's positive sentiment ahead of the election but had made no new offerings recently.

"No new offerings had been made in over two months," noted Mohit Gang, co-founder and chief executive officer at Moneyfront. "With the result of the elections approaching, an expectation of continuation of policy that has been in favour of the manufacturing theme, the fund saw strong demand from investors," he said.

The fund was also the first offering by the house in nearly one year, following the launch of HDFC Defence Fund in June 2023, which has given a return of 130% since then.

Top performing funds of fiscal 2024 had also come from the sectoral/thematic category, with average returns of the top five schemes being over 100% over a one-year period to-date.

With 86% of its holdings invested, nearly 80% are held among large cap stocks, according to Value Research data. With a considerable majority of its allocation in the large cap universe, a comparison may be drawn to the fund house's scheme for the category—HDFC Top 100 Fund.

Among the top 10 stocks, the newly-launched HDFC Manufacturing Fund held a smaller part of its total holdings at 39.4% as compared to the blue-chip HDFC Top 100 Fund with 58% holding.