The fund will be managed by Dhaval Shah and will be benchmarked against S&P BSE Healthcare TRI (Total Return Index). Apart from pharma and healthcare space, the fund will also invest in large opportunities in sectors like hospitals and diagnostics, wellness businesses, or the global contract research and manufacturing services industry (CRAMS).
The fund house believes that there are a lot of opportunities in the healthcare sector and that is why they have come up with the new scheme. The increased government spending on public healthcare through schemes like ‘Ayushman Bharat’, growing penetration of health insurance, higher life expectancy and increasing spends towards healthcare and wellness will act as a stimulus for growth in the sector, the fund house believes.
Should you invest?
The industry has nine schemes investing in the pharma sector, mostly from big fund houses. In the last one and three years, these schemes have been struggling to give good returns to investors. That is one reason why mutual fund advisors are not very keen on recommending pharma funds to investors. Moreover, most advisors are against the idea of investing in an NFO unless it brings something unique to the table.
“Apart from being an NFO, this is a sectoral scheme and we believe that these schemes are risky for retail investors. You should invest in a scheme like a pharma fund only if you are aware of the sector and you are a mature, aware investor. Even then, going for a scheme that doesn’t have a proven track record is not a wise decision,” says Neeraj Chauhan, CEO, The Financial Mall.
Scheme at a glance:
Category: Sectoral-Pharma
Plans: Growth, Dividend
Benchmark: S&P BSE Healthcare TRI
Fund manager: Dhaval Shah
Exit Load: 0.5% for redemption within 90 days
NFO Open: Jun 20, 2019
NFO Close: Jul 04, 2019
Minimum Investment: 1,000