Canara Robeco Consumer Trends Fund: Proven wealth creator in the long term

Canara Robeco Consumer Trends Fund has a strong long term track record of wealth. If you invested Rs 1 lakh in this fund at the time of its launch in 2009, your investment would have multiplied 10X to Rs 10.1 lakhs (as on 9^th January 2025). India is a primarily a consumption driven economy. As per Economic Survey 2023-24, India’s private consumption was 60% of India’s GDP. Private consumption will continue to drive economic growth in India and will continue to be an important investment theme in the future. In this article, we will review Canara Robeco Consumption Trends Fund.

Why is consumption an attractive investment theme in the long term?

• Demographic dividends will drive consumption growth in India. As per Economic Survey 2023-24, 65% of the population of India is below the age of 35.


• Rising prosperity will also be a major driver of consumption growth rate. India’s per capita GDP at constant prices (2015 USD) grew from sub $1,000 levels in the mid 90s to nearly a $2,480 in 2023 (source: World Bank). $2,000 GDP per capita has traditionally been seen as the inflection point in economic growth e.g.


• International Monetary Fund (IMF) forecasted India’s per capita income will rise to $4,000+ in the next 5 years (source: IMF). As per capita rises, consumption patterns and consumer preferences change.


• Growing urbanization of India will also be a major driver of consumption growth. 30 years back 26% of India’s population lived in urban areas. This percentage has now grown to 36% (source: World Bank, 2023).


• Other drivers of consumption growth include shift from unorganized to organized sectors, nuclearization of families, digital penetration and online shopping.

Canara Robeco Consumer Trends Fund has outperformed the broad market

The chart below shows the growth of Rs 10,000 investment in Canara Robeco Consumer Trends Fund versus the large cap index, Nifty 100 TRI since the inception of the scheme.

Source: Advisorkhoj Research, National Stock Exchange, as on 9^th January 2025

Superior rolling returns compared to peers

The chart below shows the 3 year rolling returns of Canara Robeco Consumer Trends Fund versus the Thematic Consumption Funds category average over the last 5 years. You can see that during this period Canara Robeco Consumer Trends Fund consistently outperformed the category average for 5 year investment tenures across all market conditions e.g. rising market, falling market, range bound market etc. The fund gave 15%+ CAGR returns over 3 year investment tenures in nearly 100% of the instances (observations).

Source: Advisorkhoj Rolling Returns, National Stock Exchange, as on 31^st Dec 2024.

Canara Robeco Consumer Trends Fund also outperformed the peers consistently over longer investment tenures. The chart below shows the 5 year rolling of Canara Robeco Consumer Trends Fund versus the category average rolling returns over the last 10 years. You can see that the fund consistently outperformed the category average. The fund gave 15%+ CAGR returns over 5 year investment tenures in nearly 62% of the instances (observations) and 12%+ CAGR returns in nearly 85% of the instances (observations).

Source: Advisorkhoj Rolling Returns, National Stock Exchange, as on 31^st December 2024.

Wealth creation through SIP

There is a perception among investors that thematic funds need market timing and therefore suitable mainly for lump sum investments. However, a broad theme like consumption, which is diversified across several sectors, can be suitable for long term investment through SIP. The chart below shows the growth of Rs 10,000 monthly SIP in Canara Robeco Consumer Trends Fund since the inception of the scheme. With a cumulative investment of Rs 18.4 lakhs, you could have accumulated a corpus of Rs 79.2 lakhs.

Source: Advisorkhoj Research, as on 9^th January 2025.

Canara Robeco Consumption Fund – Investment Strategy

• The fund identifies themes like changing consumption pattern emerging out of rising middle class and increase in per capita income potential


• Fund follows a ‘Growth’ style of investing


• Market cap agnostic with focus on management quality


• Focus is on selective categories such as 1) discretionary consumption - supported by aspirational spending and rising disposable income and 2) the retail financers (banks and NBFCs) benefiting from the low credit penetration in the retail segment


• The fund participates in categories supported by regulatory or demand-backed tailwinds


• For stock selection, the fund manager spots the changing dynamics in an industry, identify winners early and then stay invested with superior executors to earn compounding returns


• Canara Robeco, as an AMC, focuses on the fundamentals of the business, the quality of management, sensitivity to economic factors and the financial strength of the company

Current Portfolio Positioning

Many investors associate consumption with FMCG and consumer durables only. Consumption as an investment theme is diversified across many sectors. You are likely to get diversified sector exposure by investing in Canara Robeco Consumer Trends Fund. The fund portfolio has a large cap bias.

Source: Canara Robeco Fund Factsheets, as on 31^st December 2024.

Low Overlap with Canara Robeco Diversified Equity Funds

The graphic below shows the portfolio overlaps of different Canara Robeco equity funds (including Canara Robeco Consumer Trends Fund). You can see that the fund has low overlap with Canara Robeco diversified equity schemes. In other words, you can include this fund in your portfolio along with other Canara Robeco equity funds.

Source: Advisorkhoj Research, as on 31^st December 2024.

Who can invest in Canara Robeco Consumer Trends Fund?

• Suitable for investors looking for tactical satellite allocations to their overall equity portfolio


• Investors who want capital appreciation over sufficiently long investment tenure


• Investors with investment horizons of at least 5 years or longer


• Investors with very high risk appetite


• You can invest in lump sum or SIP depending on your financial situation and investment needs


• Investors should consult with their financial advisors or mutual fund distributors if Canara Robeco Consumer Trends Fund is suitable for their investment needs.