Investment Objective and Approach

HDFC Defence Fund is an open-ended equity scheme that seeks to provide long-term capital appreciation by investing predominantly in equity and equity related securities of defence & allied sector companies. The scheme invests at least 80% of its net assets in defence and allied sector companies.

Investment Approach:

- The fund follows a bottom-up approach of portfolio construction within the defence ecosystem

- Focuses on companies with good quality management and demonstrated track record, aiming to achieve diversification through a multi-cap strategy across large, mid and small cap stocks

- Emphasis on growth and quality at reasonable valuations

Eligible Investment Universe:

Defence & allied sector stocks include stocks forming part of eligible 'basic industries' based on AMFI classification including aerospace and defence, explosives, shipbuilding and allied services, stocks from defence sectors as per benchmark criteria, or stocks from SIDM (Society of Indian Defence Manufacturers) list which obtain at least 10% revenue from the defence segment.

Fund Managers

The fund is currently managed by Dhruv Muchhal, Rahul Baijal, and Priya Ranjan.

Rahul Baijal:

- Holds PGDM (MBA) from IIM Calcutta and is an engineering graduate from Delhi College of Engineering

- Prior to joining HDFC Mutual Fund, he worked with Sundaram Mutual Fund, Bharti AXA Life Insurance, TVF Capital, HSBC Securities, Credit Suisse Securities & Standard Chartered Bank

- Currently manages 3 schemes with an AUM of ₹34,497 Cr

Priya Ranjan:

- Holds B.E (Computer Science) and PGDBM (Finance) with over 14 years of experience in equity research

About the Fund House (AMC)

HDFC Asset Management Company Limited launched this fund as part of their commitment to providing diverse investment opportunities. HDFC Defence Fund was launched on May 16, 2023, with the New Fund Offer (NFO) period running from May 19, 2023, to June 2, 2023. The company emphasized that "through initiatives like Make in India, the government policies remain conducive to the growth of defence sector in the country."

Navneet Munot, Managing Director and CEO of HDFC Asset Management, stated: "Defence readiness is critical to peace, prosperity and social well-being. The government has also been pushing for Aatmanirbharta in defence sector. With HDFC Defence Fund, the first of its kind fund investing in companies in the defence and allied industries, we are presenting investors an opportunity to participate in this growth story."

Key Fund Details (as of August 2025):

- Asset Under Management: ₹8,65,702 Cr as of August 19, 2025

- Expense Ratio: 0.71%

- Minimum SIP Investment: ₹100

- Exit Load: 1% if redeemed within 1 year from date of allotment

- Risk Rating: Very High

Should I Invest in HDFC Defence Fund?

This fund is suitable for investors who understand the high-risk nature of sectoral investing and are looking to capitalize on India's defence sector growth story. The scheme being sectoral in nature carries higher risks versus diversified equity mutual funds on account of concentration and sector specific risks.

Consider this fund if you:

- Believe in India's defence modernization and self-reliance initiatives

- Have a long-term investment horizon (minimum 5-7 years)

- Can tolerate high volatility and sectoral concentration risks

- Want exposure to defence and allied sector companies

- Are comfortable with very high-risk investments

Important Considerations:

- Currently, the scheme does not accept fresh lumpsum investments or fresh SIP registrations. However, systematic transactions already registered will continue to be processed.

- The defence sector is influenced by government policies, geopolitical situations, and budget allocations

- Being a thematic fund, it lacks diversification across sectors

- Performance can be highly volatile due to sector-specific factors

FAQs

What is today's NAV of HDFC Defence Fund?

The NAV changes daily based on market movements. You can check the latest NAV on Allvest or the HDFC Mutual Fund website.

What is the AUM of HDFC Defence Fund?

As of August 19, 2025, the fund has an AUM of ₹8,65,702 crores.

What is the expense ratio of HDFC Defence Fund?

The expense ratio is 0.71% for the direct plan.

What are the returns of HDFC Defence Fund since inception?

The fund has delivered absolute returns of 7.09% in the past 1 year, though being a relatively new fund launched in 2023, long-term track record is limited.

What is the minimum SIP amount to invest in HDFC Defence Fund?

The minimum SIP amount is ₹100.

How do I invest in HDFC Defence Fund?

You can invest through Allvest platform, HDFC Mutual Fund website, or through registered mutual fund distributors. Note that fresh investments may be currently suspended.

How to start a SIP in HDFC Defence Fund?

Visit Allvest, complete your KYC, select the fund, choose SIP option, set amount and frequency. However, check if new SIP registrations are currently being accepted.

How do I automate an SIP in HDFC Defence Fund?

Once you set up SIP through Allvest, it automatically debits from your linked bank account on the chosen date each month through auto-debit facility.

How can I withdraw/redeem my investment in HDFC Defence Fund?

You can redeem units on any business day. Applications received up to 3 PM get same day's NAV, while applications after 3 PM get next business day's NAV. Remember that 1% exit load applies if redeemed within 1 year.