HDFC NIFTY Smallcap 250 Index Fund

Ticker: mf13301
Decent 68/100

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Business Overview

The HDFC NIFTY Smallcap 250 Index Fund is designed for investors seeking exposure to the dynamic small-cap segment of the Indian equity market. This fund tracks the NIFTY Smallcap 250 Index, offering a diversified portfolio of small-cap stocks, making it ideal for those looking to capitalize on growth potential. It matters because small-cap companies often provide higher returns over the long term, and this fund simplifies investment in this sector.

  • Diversified exposure to 250 small-cap stocks
  • Ideal for long-term growth investors
  • Tracks the NIFTY Smallcap 250 Index
  • Managed by HDFC, a trusted financial institution
  • Potential for higher returns compared to large caps

Investment Thesis

The HDFC NIFTY Smallcap 250 Index Fund presents a compelling investment opportunity due to its strong promoter credibility, promising growth in digital services, and attractive valuation compared to peers. This fund is well-positioned to capitalize on the expanding small-cap market in India.

  • Backed by the reputable HDFC Group, ensuring strong governance and reliability.
  • Significant growth potential in the digital services sector, driving small-cap performance.
  • Valuation metrics indicate an attractive entry point compared to industry peers.
  • Diversification across 250 small-cap stocks mitigates risk while enhancing returns.
  • Ideal for investors seeking long-term capital appreciation in a growing market.

Opportunity vs Risk

Opportunities
  • Diversification in smallcap sector
  • Potential for high growth
  • Lower expense ratio
  • Access to emerging companies
  • Long-term wealth creation
Risks ⚠️
  • Market volatility in smallcaps
  • Higher risk compared to largecaps
  • Liquidity concerns
  • Economic downturn impacts
  • Regulatory changes affecting smallcaps

Peer Perspective

HDFC NIFTY Smallcap 250 Index Fund trades at a slight premium compared to peers like SBI Small Cap and Axis Small Cap. A rerating could occur with sustained margin stability and improved growth metrics.
📊 Stock Investment Checklist (100 Points)
HDFC NIFTY Smallcap 250 Index Fund • Updated: 2025-09-29 13:30:42
  • 10
    Business
    High
    The fund invests in a diversified portfolio of smallcap stocks, which are generally in growth sectors.
  • 10
    Growth
    High
    Consistent revenue and profit growth observed in the underlying stocks.
  • 10
    Profitability
    High
    ROE and ROCE are above industry averages, with healthy operating cash flow.
  • 8
    Valuation
    High
    Valuation metrics are reasonable compared to peers, but some stocks are overvalued.
  • 7
    Balance
    High
    Generally low debt levels in the portfolio, but some stocks have high leverage.
  • 6
    Governance
    Good
    Promoter holding is strong, but there are concerns about transparency in some companies.
  • 5
    Drivers
    Good
    Growth drivers are present, but execution risks are significant in smallcap space.
  • 5
    Technicals
    Good
    Market sentiment is mixed; liquidity is moderate.
Final Score & Verdict
Score 68 / 100 • Decent
The HDFC NIFTY Smallcap 250 Index Fund shows decent potential for growth, but investors should be cautious of the inherent risks associated with smallcap investments.


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