Opportunity knocks again with re-opening of this fund
Ankur Thakore, National Sales Head, L&T MF
23rd May 2016
In a nutshell
L&T Emerging Businesses Fund, which was launched in May 2014 initially as a 2 year closed ended fund, to be converted after the 2 year period into an open ended fund, has now been re-opened for subscription.
A healthy track record, focus on emerging businesses which are largely small cap in nature, and the exciting possibilities for well managed small caps to ride the coming growth wave, are some of the reasons Ankur believes this fund presents an opportunity, yet again, for your clients.
Much has often been said about how equity markets perform in the long term - if markets seem to be slow right now, a long term scenario could definitely see a rebound. In times like these, there are certain companies that capitalise on the upward wave primarily because of their small-to-medium market size. Such companies are termed as emerging businesses.
Emerging businesses poised to harness the coming growth wave
Emerging businesses are termed so because they possess a potential to grow at a relatively faster pace. They could be small players in a niche segment, part of an evolving business or capitalising on an upcoming opportunity in the unorganized sector. The functions of such businesses are generally closely handled by the management, who play an integral role in their success.
Today, we are experiencing a similar situation in the current market scenario. While India is on the cusp of its next big wave, there could be an opportunity for smaller companies to ride the wave due to their attractive valuations and scalable opportunity. This fact could also be substantiated by looking at how small and mid caps have performed over the past two years, especially in comparison with large caps.
Outperformance of 10-15% in annualised terms.
Source: ICRA MFIE, as on 31st March 2016. All returns shown are compounded annualised.
Past performance may or may not be sustained in the future.
The above stated figures would give you a view of how emerging businesses could bank upon a growth wave in the markets.
What could investors do in such a situation to take advantage of the markets?
For those already invested in the markets, an improvement in the market scenario could prove beneficial and for those who have not, it could be a budding opportunity. But this opportunity needs to be routed through an instrument that gives investors an upside potential of investing in 'emerging businesses' and an effective diversification across emerging companies.
In this context, I present to you the L&T Emerging Businesses Fund which has re-opened for subscription from May 12, 2016. The Fund focuses on investing in companies which are under -researched and under-owned, thus giving an opportunity to your investors to take an exposure to a rather under-explored segment. This segment could offer higher opportunities to spot pricing anomalies. The fund's strategy is aimed at generating a relatively higher alpha in comparison with the broader market and also adds a style diversification to the investor's portfolio. To understand why L&T Emerging Businesses Fund could be ideal for investors to gain from growing businesses, watch the video.
Why should you consider recommending this fund?
It is suitable for investors looking for a well-differentiated strategy across emerging markets
The fund is handled by a team with experience of more than 60 years in the market and an extensive coverage
Lastly, if an investor stays invested in the fund, he could expect a higher alpha generation than the broader market in the long term
We believe that L&T Emerging Businesses Fund is an opportunity to actively participate in India's growth story. Invite your customers to be a part of it! To read more about the fund click here.
This article is for general information only and does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this information. Recipient of this article should understand that statements made herein regarding future prospects may not be realized. Neither this article nor the units of L&T Mutual Fund have been registered in any jurisdiction other than in India. The distribution of this article in certain jurisdictions may be restricted or totally prohibited and accordingly, persons who come into possession of this article are required to inform themselves about, and to observe, any such restrictions. For further information relating to L&T Emerging Businesses Fund please refer to the Scheme Information Document of the Scheme dated May 12, 2016.
This article is only for distributor's purpose.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
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