HDFC Nifty Realty Index Fund NFO closes on March 21; here’s all you need to know

HDFC Asset Management Co (AMC), which acts as the investment manager for fund house HDFC Mutual Fund’s products, launched the HDFC NIFTY Realty Index Fund last week.  The NFO, which hit the Street on March 7, will close on March 21.

The launch of the index fund comes in the backdrop of a multi-bagger return of 117 per cent in the Nifty Realty index, backed by a pickup in demand amid robust economic growth.

“The realty sector has the potential for long-term growth with large scale development across residential, commercial, retail, hospitality and Special Economic Zone (SEZ) projects. Improving affordability, increased urbanisation and improved transparency through government initiatives could drive growth for years to come,” HDFC Asset Management Company said in a press release.

“Listed realty companies’ fundamentals have improved with continued formalisation of the sector along with higher profitability and reduced leverage over the last 6-7 years,” HDFC AMC said.

The scheme, being an index fund investing in a specific sector, carries higher risk compared to diversified equity mutual funds on account of concentration and sector-specific risks, HDFC AMC said, adding that investors’ principal will be subject to “very high risk”.

“At HDFC Mutual Fund, our mission to be the wealth creator for every Indian continues to drive us to offer a wide range of investment solutions to meet the needs of investors. We remain committed to delivering excellence in Index Solutions, leveraging our 20+ years of expertise in this space,” said Navneet Munot, Managing Director and Chief Executive Officer of HDFC Asset Management Company.

Fund managers Arun Agarwal and Nirman S Morakhia will be overseeing the fund, the company added.

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