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UTI MNC Fund

The MNC fund is an open-ended equity mutual fund that is managed by UTI Mutual Fund AMC. The fund house is among the best asset management companies in the country as of now.

The mutual fund scheme is aimed at investors who have a higher risk tolerance and who look forward to investments in multinational enterprises and corporations that are functioning in India. These enterprises get a major segment of their revenues from various international hubs.

Features of UTI MNC Fund

The following are some of the features of UTI MNC Fund:

  • Fund Type:

This is an open-ended equity fund where investors may invest or switch to gather their investments in the scheme at any point of time.

  • Inception:

This fund was made active for individual investors for the first time on May 29, 1998.

  • Entry Load:

In the country, various fund houses are no longer open to charging an entry load to investors who are making investments in the scheme first time ever. The entry load of UTI MNC Fund is zero for now.

  • Exit Load:

The exit load associated with UTI MNC Fund stands at 1% in the situation of redemptions. Yet, this factor is applicable only upon units which are being redeemed well before completing 364 days of allocation.

Investment Objective of UTI MNC Fund

The UTI MNC Fund stands as an open-ended equity mutual fund featuring various objectives such as investments in equity stock and equity derivates of MNCs. At the time of matching stock selection with the investment objectives, the scheme will not only consider the global presence of the enterprises, but also make investments that are irrespective of sectors inside the portfolio.

Risk Level of the UTI MNC Fund

The UTI MNC Fund is largely invested in equity and its derivatives. This means that investments made under this scheme faces standard risks of equity investments such as risk to the principal investment.

Tax Considerations for UTI MNC Fund

The UTI MNC Fund invests mainly in equities and equivalent derivatives of MNCs for which there are various business interests in India and world over. Yet, the primary investment of this fund is in domestic equities, ensuring that the taxation equity investment rule is applicable to all the investments made towards the UTI MNC Fund.

In the case of this scheme, units of the fund held for 1 year or less than that from date of unit allotment before being redeemed or switched will be open to short term capital gains. Also, when units of the scheme are retained for more than 1 year from the date of allotment before being switched are open to long term capital gains.

Going by the current rules, equity STCG project a tax rate of 15% applicable mainly to the profits coming from specific investment. Currently, equity investments in India are not out of LTCG purview. This means that if the investor redeems units after holding them for 12 months or more, then the returns happen to be taxable at a rate of 10%. Dividends gathered by investors when investing in the fund are totally free of tax for the investor and not valid for the dividend distribution tax.

Plans and Options for UTI MNC Fund

Direct Plan

The UTI MNC Fund direct scheme is held back due to the high number of routes through which investors may access the policy. As of now, direct mutual fund plans are available only via the fund house. Yet the availability is inclusive of both the online and offline mode. While this variant of the scheme has a higher unit price when compared to regular plans of the scheme, some investors favour these due to the low expense ratio.

The base expense ratio of various direct plans ensures that this fund version holds the potential to generate higher returns compared to average plans in the long run. Investors for direct plans have the option for the growth also, besides dividend option.

Regular Plan

In a situation where an investor gets the services of the securities market middle man, such as brokers, they may have to go for plans of the UTI MNC Fund regular. This variant is most in demand since it can be availed through not just the fund house, but also through many intermediaries. While the regular plan is remarked by a higher expense ratio in comparison to the direct plan under the same fund, a lower NAV is also offered to investors.

The scheme is aimed at long term capital appreciation. Its primary instrument is investment in equity and associated securities with MNCs.

Growth Option

The growth option with the UTI MNC Fund growth is characterized by avoiding all interim pay-outs as long as the investor holds investment in the mutual fund. All profits from that scheme that come through existing investments are not paid to the investor, rather they are invested into additional lucrative grounds. This means that the fund will keep raising its AUM over the years. This will in turn lead to a rise in the NAV of the fund. Thus, investors who are purchasing units at lower NAVs can switch the same units at costlier NAVs at a later stage. This way growth option investors may book profits on the mutual fund investment. Therefore, this option is great for investors who need appreciation in investments instead of their income.

Dividend Option

Dividends are pay-outs that you will receive as an investor, when the fund has available surplus as a product of gathered profits. In situations when the UTI MNC Fund dividend option gives a dividend, investors get their pay out on the basis of units. Also, the dividend comes from the present AUM of the fund. This means there will be a proportional fall in the unit NAV.

Top 10 Sectoral Breakup

UTI MNC majorly invests in the stocks of multinational corporations with the aim of diversifying via differentiated offers. Multinational corporations display operational efficiencies, smooth cash flow and technological prowess, delivering efficient ROE profiles under domestic and exports category. The fund displays performance on the long run and out performs benchmark with low volatility. The gathered funds mostly go towards stocks of Multinational Corporations and various other liquid stocks. These funds gathered with the scheme are invested in equities and related instruments.

Consumer Goods – 34.70%

Industrial Manufacturing – 18.86%

Auto – 13.60%

Information Technology – 9.73%

Pharma – 6.00%

Cement – 3.83%

Construction – 1.90%

Metals – 1.61%

Fertilizer & Pesticides – 2.46%

Others – 7.31%

Top 10 Holdings of UTI MNC Fund

HOLDINGALLOCATION %ALLOCATION %
Hindustan Unilever Ltd.9.19185.29
Britannia Industries Ltd.7.90159.33
Maruti Suzuki India Ltd.7.87159.33
Mphasis Ltd.7.44149.94
Sanofi India Ltd.4.4589.65
Ambuja Cements Ltd.3.8377.26
Bosch Ltd.3.8377.14
United Spirits Ltd3.4469.43
Schaeffler India Ltd.3.3367.11
Proctor & Gamble HHCL3.1763.86

Fund Performance

Name1st Year %3rd Year %5rd Year %
Hindustan Unilever Ltd.4.27.120.2
Category Average-3.86.712.3
Difference of Fund Returns and Category Returns80.47.9
Best of Category44.423.126
Worst of Category-31.1-7.46.6
Benchmark Returns-2.71117.5
Fund-Benchmark Difference 6.9-3.92.7

SIP Performance

DURATIONCAGR%
1st Year3.39
3st Year4.47
5st Year6.94
10st Year1.66

Why to Invest?

UTI MNC Fund primarily invests in the stocks of MNCs under various sectors such as:

  • Pharmaceuticals
  • FMCG
  • Engineering etc.

This fund offers much better returns due to it not having any investments in the present beaten-down sectors such as commodities, etc. This owing to MNCs being mostly absent in these sectors. It is yet to be observed how the MNCs will perform under various market cycles. MNC fund diversification observes minimal compromise.

FAQs on UTI MNC FUND

Who should invest?

  • Investors thinking of diversifying the basic equity portfolio through good MNC stock exposure.
  • Investors seeking a fund that is market capital agnostic while they are ready to take load of the short-term divergence for returns when compared to the normal indices.

What is the nature of UTI MNC fund?

The main investment of this fund is towards stocks of MNCs. It has been observed that MNCs, while they behave as set of stocks, display efficiency in operation & capital allocation. This together with a stable generation of cash flow has helped deliver a high RoE while domestic and exports growth opportunity persist.

  • UTI MNC fund is aimed at investments in enterprises characterized by low financial leverage with high potential towards pricing in their operational zones.
  • This fund delivers a differentiated portfolio that contains quality MNCs, mostly not held by total diversified equity funds.
  • This fund displays performance in the long run. It has out-performed above the benchmark at comparatively low volatility.

How do I contact UTI AMC or its Registrar & Transfer Agent for services leading to investment?

Karvy Computershare Pvt. Ltd.

Karvy Selenium Tower B| Plot Nos. 31 & 32 |

Financial District, Nanakramguda,

Serilingampally Mandal,

Hyderabad - 500032

Board No: 040- 6716 2222,

Fax: 040-66161888

Email: uti@karvy.com Karvy Computershare Pvt. Ltd. manages UTI MF schemes

What is the UTI MNC fund dividend pay out

The main aim of this scheme is to deliver long term capital appreciation via investments mainly in equity and related securities of MNCs. Yet, there will be no assurance that the investment objective of the scheme will be gathered.

What will be the NAV for UTI MNC fund direct plan growth?

197.247 4.02 (2.08 %) (NAV as on 12 Oct, 2018)

How can I login to UTI MNC fund website?

One may login to UTI MNC fund via this portal:

utimf.com/portal/login?next=%2Fportal%2Ffsp

I want to know this fund recent performance how I get this information?

You will receive information on the fund by visiting the following link:

utimf.com/product/equity-funds/uti-mnc-fund/

I invested about 8 lakhs in UTI MNC Fund about two years. Should I wait for more 1 year for better return?

Yes; it is a good idea to stay invested in this fund for a minimum period of 5 years earn good returns from this fund.

I invested 7 lakhs for 3 years. Now the value is 7 lakhs and the compound returns are nearly 3%. What should I do with this. Can I continue to hold or redeem?

The point of an equity mutual fund is to generate good returns over long term. Since your investment has completed only 2 years, it is best to stay invested for a period of another 3 to 5 years to earn good returns.

I started with UTI MNC (G) fund via SIP of Rs. 3,000 on a monthly basis. NAV was Rs. 140 and I plan to continue for at least 3 years. Is it a good decision?

Yes; an equity mutual fund gives best returns over a longer period, preferably for an investment term of 5 to 10 years and more. Hence, one should look for a minimum investment period of minimum 5 years.

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