Get high growth with Jupiter India

A good way to get exposure to India's growth could be IC Top 100 Fund Jupiter India (GB00B4TZHH95). This fund aims for long-term capital growth by investing primarily in companies that operate or are based in India. But it can also invest in companies based in Pakistan, Sri Lanka and Bangladesh, as well as ones that derive a significant proportion of their business from or within India.

Jupiter India has outperformed its benchmark, MSCI India index, over three and five years with returns of 51.4 per cent and 111.3 per cent, respectively, compared with 37.4 per cent and 72.7 per cent for the index.

The fund's X share class has a very reasonable ongoing charge of 0.69 per cent, and the I share class's 1.09 per cent ongoing charge is not unreasonable in view of the specialist mandate and strong performance.

Avinash Vazirani has managed Jupiter India since its launch in 2008. He has more than 20 years' experience of investing in Indian equities and a strong track record. According to research company FE Trustnet, over the past seven years he has delivered a cumulative total return of 78.3 per cent, compared with 46 per cent for a composite of his peer group.

Mr Vazirani, a qualified chartered accountant, invests via a bottom-up, 'growth at a reasonable price' stockpicking process. He looks for high-growth companies with solid balance sheets and resilient, sustainable business models, which he thinks may benefit from country-wide structural trends. These include the rising spending power of the growing middle class, the outsourcing of services by overseas businesses to Indian firms and the transition of India's informal economy towards a formal economy as more people open bank accounts.

The fund is positioned to tap into these trends with its two largest sector exposures – financials and consumer goods – which account for nearly half of its assets.

Jupiter India invests across companies of various sizes and currently has about one-third of its assets in small- and mid-caps. This differentiates it from a number of other India funds which are more focused on large companies.

However, the fund's exposure to smaller companies, along with its single-country focus, increases the potential for volatility. For example, while the fund made double-digit returns of 53.8 per cent, 12.7 per cent, 22.8 per cent and 22.2 per cent in 2014, 2015, 2016 and 2017 respectively, in 2011 and 2013 it fell 32.5 per cent and 13.3 per cent, respectively. 

And over one year the fund has underperformed its benchmark. However, the fund outperforms its benchmark and delivers strong cumulative total returns over the long term. And its manager's knowledge and experience of investing in Indian equities suggests he is well placed to make the right calls over the long term.

So if you have a high risk appetite and can invest for at least five years, Jupiter India still looks like a good way to tap into India's potential and the prospect of high growth. Buy. EA

Jupiter India Fund (GB00B4TZHH95

Source: Morningstar as at 22/01/18. *Jupiter Asset Management as at 31/1217

Performance

Source: Morningstar as at 19/01/18

Top 10 holdings as at 31/12/17 (%)

Source: Jupiter Asset Management

Sector breakdown as at 31/12/17 (%)

Source: Jupiter Asset Management