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India Large yet small, sizeable opportunities in large-cap space to deliver superior alpha

WhiteOak Capital Mutual Fund today announced the launch of their new fund offer (NFO) - ‘WhiteOak Capital Large Cap Fund’. The NFO will be open from November 10-24^th 2022. It is an open-ended equity scheme investing predominantly in large-cap stocks. Almost 80% of the allocation will be towards large-caps and the fund will be benchmarked against BSE100 TRI.

WhiteOak Capital Large Cap Fund

Large caps in India are a fraction of their global counterparts in terms of revenues and market cap and present a sizeable opportunity as India’s per capita GDP growth is likely to lead to an inflection point across various sectors.

In terms of total market capitalization, India is still a few decades behind that of US and China. There are only three Indian companies among the top 100 companies globally by market cap. With its economy projected to be the third largest over the next decade, India is poised to dd a few more names in the list of top 100 global companies.

Large-caps are typically market or industry leaders, have diversified revenue streams and in general have stronger balance sheet and greater access to lower cost of capital vis-à-vis their mid cap and small cap peers. These characteristics have led to more stable operational performance during economic downturns which in turn is reflected in a better downside capture ratio.

Historically large cap index has performed relatively better in falling markets

Investors may choose Large Cap Segment to start their Medium to Long Term SIP. Volatility reduces as investors increase their investment horizon. Given below is the table with an average Large Cap Fund vs Average Nifty Index Fund Investment Journey over the last 10 Years.

The fund managers for this fund will be Mr. Ramesh Mantri for Equity, Mr. Piyush Baranwal for Debt, Ms. Trupti Agrawal for overseas investments and Equity), Mr. Shariq Merchant (Overseas Investments).

Mr. Aashish Somaiyaa, CEO, WhiteOak Capital Mutual Fund said, “After the successful launch of our previous funds i.e. Flexi Cap, Mid Cap and Tax Saver ELSS, we are launching a Large Cap NFO WhiteOak Capital MF intends to fill a vacuum of actively managed funds in India and we will leave no stone unturned to provide best-in-class investment products to retail investors.”

Mr. Ramesh Mantri, CIO, WhiteOak Capital Mutual Fund said, “At WhiteOak we believe in delivering best in class performance through our cutting edge research supported by a very well-resourced team There are ample active opportunities for  alpha generation in the large-cap space through correct sizing and rigorous bottom up stock selection process”.

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