The HDFC Corporate Debt Opportunities Fund is an income scheme focussing on generation of recurring income as well as capital appreciation through investments primarily in corporate debt.
Type of fund
This is an open ended income mutual fund.
The objective here is to generate regular income and capital appreciation through corporate debt-based investments.
|CRISIL rank||Ranked 4th in Credit Opportunities Fund|
|Entry load||0%. Any upfront commissions to be paid by investor directly to ARN holder.|
|Minimum investment||Rs.5,000 for new investors and any amount thereafter|
|SIP||No minimum amount|
|Product label – Risk and target investors||Moderate risk. Meant for investors looking to generate income over the medium to long term through corporate debt based investments.|
|Benchmark||CRISIL Short Term Bond Fund Index. This index aims to track performance of a debt portfolio consisting of AAA/AA rated corporate bonds, government securities, Certificates of Deposit and Commercial Papers.|
|SWP||Yes. Available in Fixed and Variable variants. Frequency of withdrawals are monthly, quarterly half yearly and yearly for Fixed SWP and quarterly, half yearly and yearly for Variable SWP.|
|STP||Yes. Available in two variants namely Fixed Systematic Transfer Plan (FSTP) and Capital Appreciation Systematic Transfer Plan (CASTP). Daily, Weekly, Monthly and quarterly transfer plans are available.|
|Redemption||Proceeds to be dispatched within 10 days. Minimum redemption amount of Rs.1,000 or 100 units.|
|Taxation (on investment and on redemption)||As per applicable sections under the Income Tax Act.|
Mr Shobhit Mehrotra is the Senior Fund Manager and Head of Credit and comes with over 18 years of experience in fixed income markets, credit ratings etc. He has an MBA from Clemson University, USA and has previously worked with Templeton AMC and ICRA. He manages other funds from HDFC AMC including HDFC Medium Term Opportunities Fund, HDFC Liquid Direct Plan, HDFC High Interest Short Term Direct Plan and HDFC Fixed Maturity Plan, among others.
Mr Rakesh Vyas has overall 8 years of past experience with 5 years in the field of equity research and 3 years as an application engineer. He handles several funds for HDFC Mutual Funds including HDFC Balanced Fund, HDFC Multiple Yield Fund Plan 2005, HDFC Mid Cap Opportunities Fund and HDFC Short Term Opportunities Fund and others. He has a B.E. Electrical degree and a PGDM from XLRI Jamshedpur. His past experiences have been in Lehman Brothers and Nomura.
The fund will invest the net assets in money market instruments and corporate debt opportunities with a wide range of maturities and yields to make the most out of various interest rate scenarios. With corporate debt instruments generally trading above government securities, the scheme plans to take advantage of the spread over government securities. 80-100% of the investments will be in corporate debt opportunities while 0-20% of net assets may be invested in money market instruments.
Portfolio – Sector / Top 10 holdings*
|Adani Power Ltd 2018||Engineering||SO||3.16|
|8.36% Power Finance Corp. Ltd||Financial||Bonds||2.66|
|Tata Sky Ltd 2020||Services||ZCB||2.42|
|10.81% Writers and Publishers Pvt Ltd 2018||FMCG||SO||2.36|
|11.2% Aditya Birla Retail Ltd 2017||Financial||Debenture||2.15|
|8.56% Rural Electrification Corp Ltd||Financial||Bonds||1.90|
|ITD Cementation Ltd||Construction||CP||1.84|
|12.65% Prism Cement Ltd 2017||Construction||Debenture||1.77|
|Infiniti Retail Ltd 2017||Consumer Durable||Debenture||1.74|
|12.5% Spirit Textiles Pvt Ltd 2019||Textiles||Debenture||1.73|
*As on 31st July 2015
|AUM||Rs.6373 crores (Regular Growth)|
*As on 31st July 2015
|Compounded Annualised Returns||
|Growth Option||Direct Plan – Growth Option||Growth Option||Direct Plan – Growth Option|
|Returns for last 1 year||11.78||12.60||10.18||10.18|
|Returns since inception||11.86||12.65||10.14||10.14|
*As on 30th April 2015
Expert view of the fund
The HDFC Corporate Debt Opportunities Fund invests almost exclusively in corporate debt in securities rated AA or below. The idea behind this is to maximize returns if the securities gain a lot of steam in the near future. The portfolio consists predominantly of securities of maturities less than 5 years with the mean maturity lying around 2-3 years. Interest rate risks are mitigated as the scheme will actively take credit risks. The fund is meant for active investors looking at higher than average returns from debt instruments. You should always consult with your personal financial advisor before making any investments in mutual fund schemes.
How to apply
Investors can apply for the HDFC Corporate Debt Opportunities Fund scheme via online and offline methods.
Investors can use the HDFCMFOnline web portal to register for their applications. The portal is accessible to all customers having a folio with the company. On satisfying the KYC norms, investors can fill the requisite forms and submit them online. Alternatively, investors may also use third party providers for the application purpose if it is available. However, you should be sure about the credentials of those providers before making any promises.
Offline customers can approach any of the Investor Service Centres of HDFC MF and fill the relevant forms and submit supporting documents to proceed with the application process. Alternatively, they may also use third party distributors or dealers for applying to this scheme, however they should make sure the distributor is genuine.
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