Bajaj Finserv’s New Healthcare Fund: Capitalising on India’s Healthcare Expansion

Publish Date: Dec 10, 2024

Bajaj Finserv Mutual Fund has launched Bajaj Finserv Healthcare Fund, it is an open-ended equity scheme following pharma, healthcare and allied theme.

The Indian healthcare sector is experiencing robust growth, driven by a combination of demographic, economic, and regulatory factors. A rising middle class, increasing life expectancy, and a growing awareness of health and wellness are propelling demand for healthcare services. Additionally, advancements in medical technology, improved access to healthcare facilities, and the expansion of health insurance coverage are further fuelling sector growth.

The sector is poised to benefit from the Indian government's increased investments in healthcare infrastructure, including new hospitals and clinics, digital health solutions, and a focus on preventive healthcare. Investors are increasingly drawn to the healthcare sector due to its resilience and long-term growth potential.

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The launch of the Bajaj Finserv Healthcare Fund's New Fund Offer provides a structured entry point for investors looking to capitalize on the sector's growth. By investing in a carefully curated portfolio of companies within the healthcare industry ranging from pharmaceuticals and medical devices to healthcare services this NFO offers exposure to the booming sector while managing risk through strategic allocation.

Details of Bajaj Finserv Healthcare Fund:

Investment Objective	The objective of the Scheme is to generate long term capital appreciation by predominantly investing in equity and equity related securities of pharma, healthcare and allied companies. However, there is no assurance that the investment objective of the Scheme will be achieved.
Category	Sectoral/Thematic Fund
SIP/STP/SWP	Available
Min. Investment	Rs 500/- and in multiples of Re 1 thereafter. Additional Purchase Rs 500/- and in multiples of Re 1 thereafter.	Face Value	Rs 10/- per unit
Plans	Direct Regular	Options	Growth Income Distribution cum Capital Withdrawal (IDCW)
Entry Load	Not Applicable	Exit Load	if units are redeemed / switched out within 3 months from the date of allotment: 1% of applicable NAV. If units are redeemed/switched out after 3 months from the date of allotment, no exit load is payable.
Fund Manager	- Mr Nimesh Chandan - Mr Sorbh Gupta - Mr Siddharth Chaudhary (Debt portion)	Benchmark Index	BSE Healthcare Total Return Index (TRI)
Issue Opens:	December 06, 2024	Issue Closes:	December 20, 2024

(Source: Scheme Information Document)

What will be the investment strategy for Bajaj Finserv Healthcare Fund?

Bajaj Finserv Healthcare Fund is an open ended actively managed equity scheme which aims to provide long-term capital appreciation by investing in equity and equity related securities of companies classified under 'Healthcare Equipment & Supplies, Healthcare Services, Pharmaceuticals & Biotechnology' as per Industry classification issued by AMFI from time to time and any other industry/sector that forms part of the benchmark index.

The Scheme may also invest in companies involved in other healthcare, pharmaceutical and allied sectors. The scheme would invest in stocks across market capitalization, however, may take concentrated exposure to certain stocks/sectors/industry.

Bajaj Finserv's investment philosophy, which centers around three key pillars: Information Edge (IN), Quantitative Edge (QU), and Behavioral Edge (BE). The Information Edge focuses on outperforming the market through superior information collection. The Quantitative Edge emphasizes using quant models and analytical tools to process and analyze information more effectively. The Behavioral Edge aims to enhance decision-making by leveraging crowd behavior insights and mitigating personal biases, ultimately aiming to outperform the market.

This philosophy is designed to integrate advanced analytics and disciplined decision-making to achieve superior investment outcomes.

(Source: Bajaj Finserv Healthcare Fund - PPT)

Examples of industries/sectors classified under 'Healthcare Equipment & Supplies, Healthcare Services, Pharmaceuticals & Biotechnology' are as follows:

• Biotechnology

• Healthcare Research, Analytics & Technology

• Healthcare Service Provider

• Hospital

• Medical Equipment & Supplies

• Pharmaceuticals

• Over the counter medicine, nutraceutical

• Any other industry/sector that forms part of the benchmark index

This list is indicative and may include other sectors/industries that align with the pharma, healthcare, and allied themes as determined by the Fund Manager. Additional sectors may be incorporated as they are added to the BSE Healthcare Index over time.

How will the scheme allocate its assets?

Under normal circumstances, Bajaj Finserv Healthcare Fund will hold an allocation of 80% to 100% in Equity and Equity Related Securities of pharma, healthcare and allied companies, 0% to 20% in Equities and Equity related securities of other than pharma, healthcare and allied companies, 0% to 20% in Debt and Money Market Instruments* and Units of Mutual Fund schemes and 0% to 10% in Units issued by REITs and InvITs.

Should investments in Bajaj Finserv Healthcare Fund be considered?

Bajaj Finserv Healthcare Fund aims to generate long term capital appreciation by predominantly investing in equity and equity related securities of pharma, healthcare and allied companies.

The healthcare sector has shown promising growth due to factors such as increasing healthcare expenditure, a rising aging population, advancements in medical technology, and a greater focus on preventive care. Additionally, the Indian government's initiatives to improve healthcare infrastructure and accessibility are driving demand for healthcare services and products.

The Bajaj Finserv Healthcare Fund aims to capitalize on these trends by investing in companies across various segments of the healthcare industry, including pharmaceuticals, medical devices, hospitals, and healthcare services. This fund provides investors with exposure to the healthcare sector's potential for long-term growth, driven by increasing consumer spending, favorable demographic trends, and supportive government policies.

The strategic allocation within the fund enables investors to benefit from the sector's growth while managing risk through diversification across different healthcare sub-sectors. However, the demand for healthcare services and products could be cyclical, influenced by economic downturns or shifts in public health priorities. Changes in regulations, such as drug pricing controls or tighter healthcare policies, may impact the profitability of companies within the sector.

While the fund presents growth opportunities, especially for those seeking targeted exposure to this sector, investors should be aware of the risks associated with its concentrated nature. The performance of the scheme might therefore be impacted by different variables and may affect negatively if the sector moves out of favour.