Motilal Oswal launches a fund dedicated to large cap stock

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NFO closes on 31st January 2024

Presenting the launch of Motilal Oswal Large Cap Fund, an open-ended equity scheme predominantly investing in large-cap stocks.

Aim to benefit from a Hi-Quality Hi-Growth Large Cap portfolio with ACE portfolio construct, a strategy focusing on active share, high conviction, and an equal-weight portfolio.

The investment objective of the scheme is to generate capital appreciation by investing predominantly in large-cap stocks.

Why consider investing in Large Cap stocks?

  1. Large Caps are 35% of India’s GDP; 65% of of the sales of Nifty Total Market Index & 74% of Corporate India’s Profits (listed companies)

  2. Indian Large Caps are mid and small caps in a Global Context (100th ranked Indian company is 2,140th ranked Global company)

  3. Growth in Purchasing Power: Nifty 100 TRI has compounded at ~29x in 21 years (~17.4% CAGR) v/s a regular income at ~4.1x. v/s Inflation at ~3.3x

  4. Benefit from an exposure to a smallcap universe of 537 companies with a market cap of over 2,000 cr - A likely fertile ground for alpha generation

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Why invest in Motilal Oswal Large Cap fund?

High Active share

Peers have a lower active share and allocation similar to the index. Motilal Oswal Large Cap Fund aims to have a significant active share (60%-80%)

High Conviction Focused portfolio

Peers on an average have 58 stocks in their portfolio while Motilal Oswal Large Cap Fund aims to have a High Conviction 30 stock portfolio

Equi-weighted portfolio

Motilal Oswal Large Cap Fund = High Conviction + Balanced Diversification. Index & Peers are significantly skewed towards Top 3 names

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Disclaimer:

Data as on FY23. Source: Capital IQ, Bloomberg, MOAMC Internal Research. Revenue and profit data has been calculated basis top 750 listed companies. The above graph is used to explain the concept and is for illustration purpose only and should not used for development or implementation of an investment strategy.

Data as on Dec 23. Source: Bloomberg. M Cap in USD Bn Past performance may or may not be sustained in future. The above graph is used to explain the concept and is for illustration purpose only and should not used for development or implementation of an investment strategy.

Data Since 1st January,2003 to Dec’23. Source: Nifty Indices, Motilal Oswal AMC Internal Research; Inflation data has been made using Cost Inflation Index. Disclaimer: Past performance may or may not be sustained in future. The above graph is used to explain the concept and is for illustration purpose only and should not used for development or implementation of an investment strategy. *Regular income are risk free returns, however, risks associated with regular income and equities are different. Please refer to the Risk Factors slide & SID and KIM of the scheme for additional details.

Source: MOAMC Internal Research, AMFI, As of 30th Jun’23 classification by SEBI.

Source: ICRA, Motilal Oswal Internal Analysis. Data as of Nov’23. Disclaimer: Past performance may or may not be sustained in future. The above data is used to explain the concept and is for illustration purpose only and should not use for development or implementation of an investment strategy. ^up to 20% of the portfolio may be an exception to the above frameworks. The above construct is based upon our current fund management/ investment strategy. However the same shall be subject to change basis the disclosures made in the SID and KIM of the scheme.

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