Canara Robeco Mutual Fund has introduced a new fund focusing on the manufacturing sector, aiming to leverage India's potential as a global manufacturing hub.

Named the Canara Robeco Manufacturing Fund, it is an open-ended equity scheme designed to capture opportunities within India's manufacturing landscape. The fund will track the performance of the S&P BSE India Manufacturing Total Return Index.

The New Fund Offering (NFO) began on February 16 and will conclude on March 1. With manufacturing being a relatively nascent category in mutual funds, currently featuring only five active schemes, Canara Robeco's initiative arrives amidst favorable conditions, as highlighted by CEO Rajnish Narula.

Narula emphasized India's advantageous position, citing factors such as a burgeoning middle class and an expanding working-age population. He outlined the fund's strategy to capitalize on various policy reforms including Atmanirbhar Bharat, Production Linked Incentive Scheme, Make in India, Single Window Clearance, and import substitution.

The fund will primarily allocate at least 80% of its assets to manufacturing and related stocks, with the remainder distributed across equity, debt, and instruments unrelated to manufacturing. Additionally, investments in Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs) may constitute up to 10% of the portfolio.

Investors can participate with a minimum investment of Rs 5,000, with subsequent increments of Re 1. The fund management will be led by Pranav Gokhale, Senior Fund Manager, and Shridatta Bhandwaldar, Head Equities at Canara Robeco AMC.

Bhandwaldar highlighted the fund's growth-oriented strategy, aiming to seize opportunities across various sectors aligned with the manufacturing theme.

Among the existing manufacturing schemes, only Aditya Birla Sun Life Manufacturing Equity and ICICI Prudential Manufacturing boast a track record exceeding three years. Meanwhile, Axis India Manufacturing, Kotak Manufacture in India Fund, and Quant Manufacturing are relatively newer entrants in the segment.