Table Of Content
- Our Investment Strategy for the Great Indian Middle Class
- What do you invest in with these Consumption Sector Mutual Funds?
- Great Indian Middle Class Mutual Funds: Pros and Cons
- Great Indian Middle Class: Annualised past returns
- Who should invest in Great Indian Middle Class?
Investing in millions of Indian households' shifting consumption patterns is possible with the Great Indian Middle-Class portfolio. The ordinary Indian's disposable income rises in tandem with the country's economic growth. This implies that people have more money to spend on travel, entertainment, food, and clothes. This is opening doors for businesses who offer these goods and services. It makes investments in companies operating in these industries, including retail, multiplexes, hotels, entertainment, consumer durables, and fast-moving consumer goods (FMCG). You can learn about the expansion of the middle class in India and the commercial prospects it presents by making an investment in this.
Quick Summary
Participate in India’s consumption led demand and capitalise it. Invest in "Great Indian Middle Class" a mutual fund portfolio that benefits from the rising consumer sector of India.
The "Great Indian Middle Class" portfolio by Stack Wealth allows you to invest in a basket of stocks benefiting either directly or indirectly from the rising consumption-led demand in India.
Our Investment Strategy for the Great Indian Middle Class
A basic, bottom-up strategy will be used to manage the portfolio, with an emphasis on finding growth companies with strong return on equity (ROE) and long-term competitive advantages.
- Invest in a variety of market size and style sectors, choosing stocks in the consumer sector from the bottom up.
- Invest in overseas securities, such as international debt and equity instruments, ADRs, and GDRs.
- Keep your stock portfolio focused on companies in industries such as FMCG, autos, e-commerce, media & entertainment, banks, education, and transportation.
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What do you invest in with Great Indian Middle Class ?
- FMCG businesses that prioritize premiumization, low per capita consumption, and other innovations.
- Shares of businesses involved in media & entertainment, retail, textiles, consumer durables, non-durables, and car OEMs.
- White goods firms driven by electrification, consumer finance, and low penetration rates.
- Businesses engaged in consumer transportation, e-commerce, airlines, hotels, resorts, and travel services; also, education services.
Great Indian Middle Class : Pros and Cons
Benefits
- Emphasize demand driven by consumption.
- Makes a limited number of stock investments, which can assist lower risk.
- A bottom-up strategy that can find highly promising but cheap stocks.
Drawbacks
- There may be volatile times in the consumer sector because it is cyclical.
- Somewhat expensive fees.
- Greater danger than typical.
Great Indian Middle Class: Annualised past returns
- The majority of consumer space-focused funds have beaten benchmark indices over the last 1, 3, and 5 years. The NIFTY India Consumption Index is used as the benchmark for the fund (TRI).
- By investing in a diverse portfolio of equities and equity-related instruments in the consumer arena, this portfolio seeks to give investors the chance to benefit from long-term capital appreciation.
- It has a high risk rating.
- Benchmark: NIFTY 500- TRI
Want to know more?
Talk to our advisory team.
They will be happy to help you plan and manage your investments.
Talk to an expertWho should invest with the Great Indian Middle Class Stack ?
This portfolio is designed for long-term capital gain seekers who are prepared to assume a modest level of risk. Investors should anticipate short-term volatility and have a time horizon of at least seven years or more. A fundamental understanding of the consuming sector and the variables influencing its success is a must for investors.
- This is ideal for the age group of 18 years upto 50 years
- This is for investors who delve in aggressive risk investing
- Investment horizon of 7+ years
- You can expect long term capital appreciation
- This is ideal for investors with the financial goals of saving for a child's future and generating income to supplement retirement.
FAQs
1. What are Consumer Sector Mutual Funds?
Consumer sector mutual funds are a type of thematic fund that invests in companies engaged in the production, distribution, and sale of consumer goods and services. This includes a wide range of sectors, such as:
- Fast-Moving Consumer Goods (FMCG): Food, beverages, tobacco, personal care products, household products, etc.
- Discretionary Consumer Goods: Durable goods like cars, appliances, electronics, etc.
- Consumer Staples: Essential goods like food, beverages, and tobacco.
- Consumer Services: Retail, hospitality, restaurants, healthcare, education, etc.
Investing in consumer sector mutual funds can be a good way to tap into the growth potential of the Indian consumer market, which is expected to be one of the fastest-growing in the world.
2. What are the benefits of investing in Consumer Sector Mutual Funds?
- High Growth Potential: The Indian consumer market is expected to grow at a CAGR of 10-12% over the next few years, driven by factors such as rising disposable incomes, increasing urbanization, and changing consumer preferences. This high growth potential can translate into good returns for investors in consumer sector mutual funds.
- Diversification: Consumer sector mutual funds provide diversification benefits, as they invest in a variety of companies across different sub-sectors. This can help to reduce risk and improve your portfolio's overall performance.
- Professional Management: Consumer sector mutual funds are managed by experienced fund managers who have expertise in researching and selecting stocks. This can save you time and effort, and help you to make informed investment decisions.
3. What are the risks of investing in Consumer Sector Mutual Funds?
- Volatility: Consumer sector stocks can be volatile, as they are influenced by factors such as economic conditions, consumer sentiment, and commodity prices. This can lead to short-term fluctuations in the value of your investment.
- Competition: The Indian consumer market is becoming increasingly competitive, with new players entering the market all the time. This can put pressure on established companies and lead to lower profitability.
- Regulation: The consumer sector is subject to government regulation, which can sometimes change unexpectedly. This can impact the profitability of companies in the sector and lead to losses for investors.
4. Who should invest in Consumer Sector Mutual Funds?
Consumer sector mutual funds are suitable for investors with a long-term investment horizon who are willing to take on some risk. They are also a good option for investors who want to diversify their portfolios and gain exposure to the Indian consumer market.
