ICICI Pru Nifty 500 Index Fund
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Business Overview
The ICICI Pru Nifty 500 Index Fund is a passive investment option designed to track the performance of the Nifty 500 Index, which represents the top 500 companies in India. Ideal for investors seeking long-term growth through diversification, this fund offers a simple way to gain exposure to a broad spectrum of the Indian equity market. It matters because it provides a low-cost, transparent investment avenue with the potential for capital appreciation.
- Tracks the Nifty 500 Index for broad market exposure
- Ideal for long-term investors seeking growth
- Low expense ratio enhances returns
- Transparent and easy to understand
- Diversifies risk across multiple sectors
- Managed by a trusted financial institution
Investment Thesis
ICICI Pru Nifty 500 Index Fund stands out due to its strong backing from the reputable ICICI Group, ensuring credibility and trust. The fund is well-positioned to benefit from the growth in digital services, catering to a tech-savvy investor base. Additionally, its attractive valuation compared to peers makes it a compelling choice for long-term investment.
- Strong promoter group: Backed by the trusted ICICI brand.
- Significant growth potential in digital services sector.
- Attractive valuation compared to competitors enhances investment appeal.
- Diversified exposure to the Nifty 500 index reduces risk.
- Ideal for long-term investors seeking stable returns.
Opportunity vs Risk
- Diversified exposure to 500 stocks
- Low expense ratio
- Potential for long-term growth
- Passive investment strategy
- Suitable for new investors
- Market volatility impacts returns
- Limited active management
- Tracking error risk
- Economic downturn effects
- Regulatory changes in mutual funds
Peer Perspective
ICICI Pru Nifty 500 Index Fund trades at a slight premium compared to peers like Nippon India Nifty 500 Index Fund and HDFC Nifty 500 Index Fund; a sustained growth acceleration could trigger a rerating.
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10BusinessHighThe fund invests in a diversified index, providing exposure to a future-ready sector.
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10GrowthHighConsistent revenue and profit growth observed in underlying index constituents.
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10ProfitabilityHighROE and ROCE metrics are favorable, with positive cash flow.
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8ValuationHighValuation metrics are in line with peers, indicating fair pricing.
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7BalanceHighStrong balance sheet with manageable debt levels.
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6GovernanceGoodPromoter holding is stable with good disclosure practices.
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5DriversGoodGrowth drivers are present, but execution risks exist.
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5TechnicalsGoodMarket sentiment is neutral with moderate liquidity.