HDFC Business Cycle Fund

Just how GPS enables us to choose better routes to reach our destination faster, and avoid routes with obstructions / higher traffic, the HDFC Business Cycle Fund aims to achieve better investment outcomes by investing in businesses likely to enjoy favorable business cycles, while avoiding companies about to enter / in a business downcycle.

Cycles have been observed across facets of life and markets, where things improve / accelerate and decelerate in succession. Business cycles track the journey across four phases of growth in business activity (Expansion, Peak, Contraction and Slump), in factors such as sales growth, business sentiment, etc.

Why business cycle investing?  Higher confidence on business cycle forecasts vs economic cycle forecasts Investing in businesses likely on the cusp/midst of favorable business cycles gives investors dual benefit of earnings growth and improvement in valuations Aim to stay ahead of the curve in assessing cycles using lead indicators, domain expertise and recurring pattern in business history Agile investment strategy to be rotated basis assessment of stages of business cycles Why HDFC Business Cycle Fund? Follows a blend of top down and bottom up approach Core of portfolio (>80%) would be companies likely on the cusp / midst of favorable business cycle, while avoiding companies about to enter/in a business downcycle Non-core (<20%) portfolio would consist of 1) growth stories relatively agnostic to the business cycle 2) stocks relatively better positioned within their sector 3) tactical opportunities with favorable risk-reward Risk management: Adequate diversification (across sectors / sub sectors / market cap) along with an active approach towards business cycle selection HDFC Business Cycle Fund (An open ended equity scheme following business cycle based investing theme) is suitable for investors who are seeking* Riskometer @ To generate long-term capital appreciation/ income Investment predominantly in equity & equity related instruments of business cycle based theme *Investors should consult their financial advisers, if in doubt about whether the product is suitable for them. @For latest Riskometer, investors may refer to the Monthly Portfolios disclosed on the website of the Fund viz. www.hdfcfund.com