Invesco India Growth Opportunities: Steady show across market conditions

The fund has outperformed category average across one-, three- and five-year periods

In the current choppy market, investors seeking a mixed portfolio from the large- and mid-cap category can consider investing in Invesco India Growth Opportunities Fund (earlier known as Invesco India Growth).

Invesco India Growth Opportunities is benchmarked against S&P BSE 250 LargeMidCap 65:35 Index. The fund invests about 35 per cent in mid-cap stocks and the balance in large-caps that are growth-oriented. It tends to protect downsides well during corrective markets. With the broader market being volatile, investors can opt for the systematic investment plan (SIP) route to somewhat mitigate risks, and gain from cost-averaging.

The fund has outperformed the category average across all time-frames — one, three and five years. It has delivered a negative of 2.5 in the one-year period, while the category average was -9.6 per cent. Over the long term, it has outperformed the category by gaining 15 per cent and 16 per cent over three- and five-year periods, respectively.

Performance and strategy

For one- and three-year periods, the scheme is placed in the top quartile of its category. Invesco India Growth Opportunities contained downsides well in the falling markets of 2011 and 2018.

Also, the fund has done better than its peers such as Canara Robeco Emerging Equities and Mirae Asset Emerging Bluechip over the past year. It has a good track record of stock-picking and delivering higher returns across all time-frames.

Taking the SIP route can benefit investors over the long term.

In line with the mandate, the fund invests in large- and mid-cap companies, employing both the top-down as well as the bottom-up approach.

Also, to generate steady returns in all market conditions, it doesn’t adopt any style or sector bias.

Top three sectors account for 50 per cent of the portfolio; banking is the top preferred sector with 23 per cent of the asset allocation.

Petroleum products, pharma, auto ancillary and software are the other top preferred sectors.

Even while being defensive, software and pharma stocks have rallied well in the last one year and have contributed well to the fund’s outperfromance.

Interestingly, the scheme has upped its allocation to consumer non-durables, while trimming the allocation to finance and automobiles sectors over the past six months as NBFCs faced liquidity challenges and auto sales slowed down.

Recently, it added stocks from the media and entertainment sector.

The fund has about 41 stocks spread across 18 sectors.

Stable blue-chip stocks such as HDFC Bank, RIL, ICICI Bank and IndusInd Bank are some key holdings of the scheme that add stability to its performance.

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