ICICI Prudential Launches Conglomerate-Focused Equity Fund to Tap India's Diversified Business Giants

The ICICI Prudential Conglomerate Fund, announced on September 30, 2025, opens for subscription from October 3-17, 2025, with a minimum investment of Rs. 1,000 during the New Fund Offer (NFO) period. This open-ended equity scheme specifically focuses on conglomerate businesses - promoter-led groups domiciled in India with two or more listed entities spanning diverse sectors and industries.

Strategic Investment Universe

The fund's investment universe encompasses approximately 71 conglomerate groups comprising roughly 240 companies across multiple sectors. This expansive reach provides the scheme with flexibility to invest across market capitalizations - large, mid, and small cap companies - creating a wide canvas of opportunities for investors.

Sankaran Naren, Executive Director and Chief Investment Officer of ICICI Prudential AMC, emphasized the fund's strategic positioning: "India's leading business groups have shown remarkable ability to reinvent themselves across decades, whether it is pioneering organized retail, transforming telecom, or entering future-ready areas like renewable energy and semiconductors. They combine scale with vision, and resilience with adaptability".

Structural Advantages of Conglomerates

The fund capitalizes on several inherent strengths that conglomerates possess. These business groups benefit from deep pockets and strong balance sheets, with relatively high operating cash flows supporting capital expenditure and working capital requirements. Their strong credit ratings translate to lower cost of capital, particularly advantageous during volatile market conditions.

Conglomerates also leverage economies of scale through shared resources, technology partnerships, and large customer bases, enabling cost efficiency and talent retention. Many groups pursue forward, backward, and adjacent integration across value chains - expanding into logistics, energy, financing arms, or design - thereby stabilizing supplies, lowering costs, and creating new revenue streams.

Timely Market Positioning

The current global and domestic environment strengthens the investment case for conglomerates. Global challenges including reciprocal tariffs, supply chain disruptions, and elevated borrowing costs are pressuring growth and fueling inflation, making diversified business groups better positioned to navigate this volatility.

Market data supports this thesis, showing conglomerates' steadily rising market share in the Nifty 100, reflecting their growing importance in India's corporate landscape. During periods of weak profitability, these diversified business groups have demonstrated relatively more stable cash flows compared to focused entities.

Historical performance validates their resilience - whether during infrastructure downcycles, liquidity crises, or telecom disruptions, conglomerates have consistently consolidated market share while smaller players struggled.

Fund Management and Benchmarking

The scheme will be managed by Mr. Lalit Kumar, with the BSE Select Business Groups Index serving as the benchmark. The portfolio construction approach combines structural strength with cyclical opportunities, enabling participation across different phases of economic cycles.

The fund's strategy focuses on conglomerates' expansion into sunrise sectors, including renewable energy, semiconductors, and electric mobility, positioning investors to benefit from India's evolving growth story. These business groups' ability to manage downcycles through diversified revenue streams helps them navigate challenging business cycles, acquire weaker rivals, and expand during downturns.

In today's uncertain global and domestic environment, this fund enables investors to participate in conglomerates' dual capability - protecting capital while capturing long-term wealth creation opportunities across sectors and market capitalizations.

Disclaimer: Mutual Fund investments are subject to market risks, read all scheme related documents carefully.