HDFC Defence Fund, the only actively managed fund based on defence sector, added Tata Motors in its portfolio as a new entrant in May and reduced its exposure in MTAR Technologies and one other stock in the same period, according to the portfolio disclosed on ACE MF.
The defence sector based fund added 5 lakh shares of Tata Motors in its portfolio worth market value of Rs 18.97 crore. It further reduced its exposure in MTAR Technologies and Rishabh Instruments from its portfolio.
Around 50,000 shares of MTAR Technologies were sold from the portfolio and the fund had 7.50 lakh shares in its portfolio in May compared to 8 lakh shares in April. It further sold 1.97 lakh shares of Rishabh Instruments from its portfolio in the said time period.
This sectoral fund increased its exposure in five stocks which includes Bharat Electronics, Bharat Forge, Bosch, Bharat Dynamics and Mazagon Dock Shipbuilders. Among these five stocks, the fund added the maximum number of shares of Bharat Electronics. It added nearly 16.57 lakh shares in its portfolio and had 3.66 crore shares of Bharat Electronics in May compared to 3.50 crore in April.
The fund added 2.55 lakh shares of Mazagon Dock Shipbuilders and had around 11.50 lakh shares in its portfolio, followed by adding 2.50 lakh shares of Bharat Dynamics in the portfolio in the month of May.
Nearly 86,000 shares of Bharat Forge and 6,814 shares of Bosch were added to the portfolio in May.
The exposure in 15 stocks remained unchanged which includes some names such as BEML, Eicher Motors, Centum Electronics, Premier Explosives, Solar Industries, Cyient DLM, Hindustan Aeronautics, Data Patterns (India), Power Mech Projects, Ideaforge Technology.
As a percentage to NAV, the fund had the highest allocation in Bharat Electronics of around 15.48%, followed by 14.39% in Bharat Forge, 12.06% in Hindustan Aeronautics, and 11.97% in Solar Industries.
There were 23 stocks in the portfolio in May compared to 22 stocks in April. The portfolio of the fund is spread across seven sectors such as capital goods, automobile & ancillaries, chemicals, electricals, shipbuilding, telecom, and infrastructure.
Among the seven sectors, the fund had the highest allocation in capital goods of around 52.53%. Around 20.96% was allocated in automobile & ancillaries, 15.28% in chemicals, 4.91% in electricals, 2.91% in shipbuilding, 0.88% in telecom and 0.78% in infrastructure in May.
The fund holds 49% in large caps, 18.42% in mid caps, 29.96% in small caps and 2.62% in others as of May 31, 2026. On a broader term, the fund holds 98.25% in equity and 1.74% in others.
Launched on June 2, 2023, the performance is benchmarked against Nifty India Defence - TRI and is managed by Rahul Baijal and Priya Ranjan.
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The fund has managed to outperform its benchmark in the shorter period whereas in the longer period, it failed to beat its benchmark.
In the last three months, the fund has delivered a return of 12.92% against 9.31% by the benchmark. The fund gained 21.75% in the last six months compared to 19.24% by the benchmark. The fund posted a gain of 10.94% in the last one year against 4.41% by the benchmark.
In the last three years, HDFC Defence Fund gained 40.20% compared to 51.40% by the benchmark. Since its inception the fund delivered a CAGR of 39.98%.
HDFC Defence Fund is an open-ended equity scheme investing in Defence & allied sector companies. The investment objective of the fund is to provide long-term capital appreciation by investing predominantly in equity and equity related securities of Defence & allied sector companies.
The fund is suitable for investors who are seeking to generate long-term capital appreciation/income and want investment predominantly in equity and equity related instruments of defence and allied sector companies.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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