Mumbai, India (Urban Transport News): IDFC and ICICI Bank have launched an open-ended equity program to invest in the transportation and logistics sector, aiming to benefit from the multi-year growth opportunity in the mobility services sector.
IDFC Transport and Logistics Fund opened on 4th October 2022 and will close on 18th October 2022 for subscription and ICICI Transport and Logistics Fund opened on 6th October today and will close on 20th October 2022.
“Urbanization is driving rapid growth in personal mobility needs. In addition, Strong drivers such as a strong demand-led recovery cycle and margin growth provide visibility for strong revenue growth for the transportation and logistics sector. high aspirations; increasing infrastructure; Rising volumes and export-driven opportunities are expected to drive growth in this sector. The IDFC Transport & Logistics Fund will be actively managed by a team with a strong pedigree and expertise to exploit the tremendous opportunities across this attractive value chain,” said Vishal Kapoor, CEO, IDFC AMC.
“Transportation and Logistics sector consists of 16 sub-sectors, offering wide investment opportunities and providing effective portfolio diversification. According to NSE data, Nifty Transportation and Logistics Index outperformed Nifty 500 Index by 8 in August 2022, 11 calendar years from 2012 to 2022 (YTD Aug’22) has demonstrated the sector’s potential to deliver relatively high returns over the long term. IDFC Transport & Logistics Fund has a bottom-up stock selection approach with market-wide investment. Focuses on industry-specific aspects and aligns execution with a medium- to long-term view. The fund invests predominantly in companies that are part of the transport and logistics sector and has a flexible, attractive opportunity to allocate up to 20% of its risk. Net assets for international businesses and companies of other sectors,” said Daylynn Pinto, Fund Manager for IDFC Transport and Logistics Fund.
“Transportation is an under-penetrated market in India. The government’s new logistics policy emphasizes that each sector plays a key role in the country’s economic development. Government initiatives to reduce costs and improve efficiency positively correlate with formalization of the economy and GDP growth; All stand to benefit the sector in the coming years. With muted performance over the past few years; We believe the theme has come out of the woods and has legs to recover,” said Chintan Haria, head of ICICI Prudential AMC.
“Logistics, The transition to economic transformation means a shift from the unorganized sector to support for the growth of the logistics space. India’s logistics market is estimated at $216 billion, of which it contributed only about 3.5 percent ($6-7 billion) in FY2020. We expect disruption and market share shift from unconsolidated players to consolidated players in the Indian e-Segment. Commercial exports are increasing. Going forward, government initiatives can reduce costs and increase efficiency,” he said.
The scheme will invest predominantly in shares and equity securities of companies involved in the transport and logistics theme. It will also invest in sectors and/or stocks that are part of the Nifty Transportation and Logistics TRI, a benchmark of the offering. The scheme will invest around 80 per cent in companies that are a part of the transport and logistics sector and 20 per cent in other equity/equity related instruments.