The healthcare sector in India has shown remarkable resilience and growth potential, attracting investors interested in a diverse range of healthcare companies. Mid and small-cap healthcare companies, in particular, present unique opportunities for growth that are often overlooked in larger indices.
In response to this sector’s growing importance, Motilal Oswal Mutual Fund has launched the Motilal Oswal Nifty MidSmall Healthcare Index Fund NFO, an open-ended index fund that replicates the performance of the Nifty MidSmall Healthcare Total Return Index.
This new fund offers (NFO) investors the opportunity for long-term capital growth by tracking mid and small-cap healthcare companies, providing a way to participate in the healthcare sector’s dynamic growth in a single investment.
Overview of Motilal Oswal Nifty MidSmall Healthcare Index Fund
The Motilal Oswal Nifty MidSmall Healthcare Index Fund is an open-ended fund that mirrors the performance of the Nifty MidSmall Healthcare Total Return Index (TRI). This fund allows investors to access a diverse set of healthcare companies across the mid and small-cap spectrum, covering various sub-sectors within the healthcare industry.
Investment Objective of the Fund
The investment objective of the Motilal Oswal Nifty MidSmall Healthcare Index Fund is to provide returns, before expenses, that correspond to the total returns of the securities represented by the Nifty MidSmall Healthcare TRI, subject to tracking error. The fund aims to offer investors exposure to India’s mid and small-cap healthcare sector, catering to those with a long-term investment horizon and a moderate-to-high risk tolerance.
Key Details of Motilal Oswal Nifty MidSmall Healthcare Index Fund NFO
Here are key details of the fund:
| Attributes | Details |
| Fund House | Motilal Oswal Mutual Fund |
| Risk Profile | Very High |
| Fund Managers | Mr. Swapnil Mayekar, Mr. Rakesh Shetty |
| Category | Index Fund |
| NFO Opens | October 29, 2024 |
| NFO Closes | November 6, 2024 |
| Benchmark Index | Nifty MidSmall Healthcare Total Return Index |
| Exit Load | 1% if redeemed on or before 15 days; Nil after 15 days |
| Minimum Investment Amount | Rs. 500 and in multiples of Re. 1 thereafter |
Portfolio Allocation
The fund allocates its assets across a broad spectrum within the healthcare sector, including:
| Instruments | Indicative Allocations (% of Total Assets) |
| Constituents of Nifty MidSmall Healthcare Index Fund | 95% – 100% |
| Units of Liquid schemes and Money Market instruments | 0% – 5% |
This comprehensive allocation provides investors with exposure to various segments within the healthcare sector, ensuring diversity across mid and small-cap companies.
Risks and Returns
As an index fund, the Motilal Oswal Nifty MidSmall Healthcare Index Fund NFO seeks to closely replicate the returns of the Nifty MidSmall Healthcare TRI. Due to its focus on the healthcare sector and mid-small-cap stocks, Motilal Oswal Nifty MidSmall Healthcare Index Fund NFO carries a higher level of risk, and investors should be prepared for potential volatility and tracking errors.
Nifty MidSmall Healthcare TRI has delivered returns of 59.51%, 20.57%, and 27.97% in that past 1 year, 3 years, and 5 years respectively.
Healthcare sector investments are often influenced by regulatory changes, technological advancements, and industry-specific challenges. While these factors contribute to the sector’s growth potential, they also introduce sector-specific risks that investors need to consider.
Motilal Oswal Mutual Fund
Motilal Oswal Asset Management Company (MOAMC) is a SEBI-registered portfolio manager that runs the Motilal Oswal Mutual Fund (MOMF). It is backed by Motilal Oswal Financial Services Limited (MOFSL), which is publicly traded on major Indian stock exchanges such as BSE and NSE. MOAMC received its SEBI registration in 2009.
As of June 30, 2024, Motilal Oswal Mutual Fund manages assets exceeding ₹66,452.27 crore and offers over 40 mutual fund schemes. Some of its popular offerings include the Motilal Oswal Flexi Cap Fund, Motilal Oswal Nifty India Defence Index Fund, and Motilal Oswal NASDAQ 100 ETF, based on their assets under management (AUM).
Meet the Fund Managers
Motilal Oswal Nifty MidSmall Healthcare Index Fund is managed by two experienced professionals in the field:
Mr. Swapnil Mayekar
Mr. Swapnil Mayekar, aged 39, holds a Master of Commerce in Finance Management and has over 13 years of experience in fund management and product development. He manages a variety of schemes, including the Motilal Oswal Nifty 50 Index Fund and the Motilal Oswal Nasdaq 100 Fund of Fund, demonstrating his expertise in managing index funds.
Mr. Rakesh Shetty
Mr. Rakesh Shetty, 42 years old with a Bachelor of Commerce degree, has more than 14 years of experience in equity trading, debt management, and exchange-traded funds (ETFs). He oversees important funds such as the Motilal Oswal Ultra Short Term Fund and the Motilal Oswal Liquid Fund, focusing on providing stable returns through effective debt management.
Who Should Invest in This Fund?
The Motilal Oswal Nifty MidSmall Healthcare Index Fund NFO is ideal for:
- Investors seeking long-term capital appreciation through exposure to the mid and small-cap healthcare sector.
- Individuals looking for sector-specific diversification within healthcare, covering pharmaceuticals, biotechnology, healthcare services, and more.
- High-risk-tolerant investors who are comfortable with the volatility associated with sectoral funds and mid-small cap companies.
This fund is particularly suited for those looking to benefit from India’s growing healthcare sector, especially within mid and small-cap companies that have the potential for higher growth.
Suggested Read – Motilal Oswal Nifty MidSmall Financial Services Index Fund NFO
