Fund Of Fortnight

Every fortnight, we recommend one open-ended equity diversified fund that has the best potential of returns for the next one year considering its constituents remain the same.[EasyDNNnews:PaidContentStart]

Reason for recommendation

The proposed GST rationalisation in India, which aims to simplify the tax structure to two slabs of 5 per cent and 18 per cent (eliminating the current 12 per cent and 28 per cent brackets), while introducing a higher 40 per cent rate for sin or luxury goods, is anticipated to significantly boost consumption-related stocks. By effectively reducing taxes on a wide range of mass-market goods and services, this move is expected to enhance price affordability and increase disposable income, particularly in the run-up to the festive season. Consequently, our MF Select choice this time is the ICICI Prudential Bharat Consumption Fund.

Since its inception in April 2019, the fund has consistently demonstrated a strong performance, making it an attractive option for those interested in India's long-term consumption growth. It has achieved an impressive annualised return of approximately 16.85 per cent, showcasing its wealth-creation potential. Over a three-year period, the fund has delivered a robust 16.39 per cent CAGR, outperforming the thematic category average. Its five-year return of about 20.6 per cent CAGR further underscores the portfolio's ability to capitalise on India's increasing discretionary spending and consumption upgrades. Although the past year saw a muted return of -1.30 per cent, the fund has managed volatility better than many ofits peers. From a risk-return perspective, the fund maintains a Sharpe ratio of 0.75, a Sortino ratio of 1.05, and a Standard Deviation of approximately 13.8 per cent, indicating a favourable balance between returns and risk. With a Moderate Beta of 0.92, it tends to be slightly less volatile than the broader market, providing some protection during turbulent periods.

its peers. From a risk-return perspective, the fund maintains a Sharpe ratio of 0.75, a Sortino ratio of 1.05, and a Standard Deviation of approximately 13.8 per cent, indicating a favourable balance between returns and risk. With a Moderate Beta of 0.92, it tends to be slightly less volatile than the broader market, providing some protection during turbulent periods.

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