New NFO Alert: Axis Consumption Fund

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The New NFO Axis Consumption Fund launched by the Axis Mutual Funds has created quite a buzz in the finance market one day prior to its arrival.

The origin of the thematic consumption category itself has a very interesting background story, a few years ago a very good example was given to promote investing, If you had bought the same amount of Maruti stocks before buying the Maruti 800, you would have become so wealthy today that you can buy 2-3 Mercedes. This shows the power of investing.

Well, if we are being practical it is not possible to do so. Some needs are necessary to fulfil but you can do so in a balanced manner where you can invest savings properly which could create a good amount of wealth for you.

Let's see, we all have shopped from Zudio but did you know its stock name is Trent, which has given multi-bagger returns?

Surely, you order food online from Zomato, which is also listed, for investment.

Likewise, this Axis Consumption stock is too based on an idea that invests in consumer-related goods.

Let us start a proper analysis of this new NFO as transparently as possible so you can decide for yourself whether you want this fund in your portfolio or not.

Check the below table for the basic details of the New Fund Offer:

Important Note: In case you have to withdraw 10% of your investment before 1 year, you can withdraw it without any charge. If you withdraw more than that, a normal 1% exit load will be applied. No load charge is applied after one year.

Next, we will see which strategy will the fund use to make money from the consumption theme.

Investment strategy Adopted By Axis Consumption Fund

The Axis Mutual Fund is among the top 10 mutual fund companies in India. This AMC's specialization is growth investing which is observant in their historical track record making it the number 1 mutual fund house for this strategy.

Therefore, we need to find out that this consumption theme, which is so big with almost 8 sectors and 70 industries, how will this fund apply its growth investing strategy?

Let's understand the investment startegy adopted by Axis Consumption Fund in three simple steps:

Step 1: Picking on Emerging Trends

• This fund finds industries where it sees an emerging trend in different sectors.
• Much like it still sees a lot of growth scope in online shopping & quick commerce where there is still a lot of room for penetration in such industries, more people are yet to be included in online shopping.
• The concept of premiumization is going on in Auto, FMCG in which the product is made more branded and sold at a higher price. Like the SUV concept in cars, branded packing is being used in FMCG.
• Companies in apparel, footwear, jewellery and tiles & sanitary items used in house construction have also been branded from unorganized to organized. Due to this, their business is growing faster.

Step 2: Finding Good Growing Sustainable Companies

• There is innovation in the products of many companies, which are also causing rapid growth in their business.
• Therefore, this fund will invest in companies that are engaged in Fast-moving consumer goods, retail and e-commerce, as they will capture this emerging trend quickly.
• Moreover, by using their fundamental analysis approach in companies of certain industries.
• The fund will pick companies with sustainable growth in the long term as they easily adapt to the very fast-changing environment and have established records of good execution.

Step 3: Investing in High ROI Companies

Then apart from this, it has high margins on investment, which will help in generating strong cash flow. It speaks for the quality stock selection by the Axis consumption fund.

In short, it will choose emerging trends in the consumption theme with fundamentally strong companies whose growth is a long-term through buy & hold approach, as the target will remain focused on making high absolute returns.

Now we will Sum up our analysis of this Mutual Funds with expert opinions and suggestions.

Expert Opinions and Suggestions on Axis Consumption Mutual Fund

Here are some top suggestions by experts:

• Strong Foundations: The Axis AMC actively tracks the consumption theme and has a good track record in growth investing.
• Who Should Invest: All types of investors can invest in this fund.
• Investment Duration: Make sure that you plan an investment for the long term with a minimum of 5-7 years.
• Portfolio Composition: Up to 30% of the portfolio can be invested in theme or sector funds for high returns.

According to the way it targets emerging trends, this fund can be a good choice to invest and surely, we will gain more clarity after its portfolio disclosure.

Is SIP Better or Lumpsum?

1. Systematic Investment Plan: The best way is through a SIP, as you will not have to wait for the market to correct.
2. Lumpsum: If you are thinking of investing a lump sum, you can do so during the market correction.

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