HDFC Multi Cap Fund

Fund of the Month: Gopal Agrawal, Dhruv Muchhal

Fund Manager: Niket Shah, Rakesh Shetty, Sunil Sawant, Ajay Khandelwal, Atul Mehra

SEBI Categorisation: Multi Cap Fund

Type & Investment Objective :The investment objective of the Scheme is to generate long term capital appreciation by investing in equity and equity related securities of large cap, mid cap and small cap companies.

Fund Commentary

• As per the AMC, the month of May started on a positive note for the global economy as US signed a trade deal with UK and agreed with China to temporarily (90 days) lower tariffs against each other. The US has indicated that more trade pacts with other countries could be signed soon, which is encouraging. US economy witnessed divergence in real vs survey data where tariff related uncertainty has dampened sentiments, but economy is holding up well as reflected in a strong labour market and decent retail sales. While Eurozone's manufacturing PMI was recorded at 33 month high in May, it remains in contraction. Similarly, tariff related uncertainty weighed on China's economy too, where manufacturing PMI remained in contraction for second month in a row.
• As on May 30, 2025, NIFTY 50 Index was trading at ~21.5x FY26E price to earnings multiple. Further, Market cap-to-GDP stood ~126% (based on CY25 GDP estimates) and the gap between 10Y G-sec yield and 1Y-Forward NIFTY 50 Index earnings yield has reduced recently [*Earnings yield = 1/ (one year forward P/E)]. After the recent rally, the valuations of many sectors are now at a premium to historical averages. Valuations for Automobiles and private banks are at a small discount to historical average.
• Over medium to long term, AMC remains optimistic on Indian equities considering structurally robust domestic growth outlook, healthy corporate profitability, strong macroeconomic fundamentals and supportive pro-growth policies. However, near-term risks include global trade uncertainties and resultant moderation in global growth, cyclical moderation in corporate earnings, slowdown in government's reforms momentum etc. (Estimates are as per the AMC)

Sectoral Overweights

• IT – With Republicans back in power, IT spending in US may increase going forward.
• Consumer Discretionary – As India moves towards high income economy, sector can deliver

Sectoral Underweights

• Materials - Global Slowdown
• Consumer Staples: Slowdown in earnings, valuation driven underweight

Sectoral Attribution – Fund Vs Benchmark – 1 Year Performance

• Positioning in IT, Utilities and Real Estate etc. contributed to outperformance.
• Positioning in Financials, Health Care and Consumer Discretionary had a negative contribution to the relative performance vis a vis the benchmark

This fund is recommended for investors with an investment horizon of 2-3 years, in line with investors’ individual risk profile and product suitability.

Top Holdings                                                                                                                                                                                       ( As 30 May 2025 )

Returns (%)                                                                                                                                                                         ( As on 30 June 2025 )

Absolute for <= 1 year and compounded annualized for > 1 year

Scheme Features

• Options: Growth and Income Distribution cum capital withdrawal (IDCW)
• Minimum Investment amount: Rs. 100
• Load Structure Exit Load: If redeemed bet. 0 Year to 1 Year; Exit Load is 1%;
• Benchmark Index: NIFTY 500 Multicap 50:25:25 TRI

       - May 2025 [Fund Size in Crs] 16,625.28

       - NAV: 52 Week High / Low: Rs. 20.13 /15.99

Product Label

This product is suitable for investors who are seeking^: To generate long-term capital appreciation/ income Investment in equity and equity related securities of large cap, mid cap and small cap companies

Source for entire data stated above is ICRA Analytics Ltd. (For Disclaimer of ICRA Analytics Ltd, refer https://icraanalytics.com/home/disclaimer)

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