PGIM India Large and Midcap Fund: Outperformed the benchmark

PGIM India Large and Midcap Fund has recently completed 1 year since launch. The fund invests primarily in large and mid-sized companies. As per SEBI's mandate large and midcap funds must invest minimum 35% each in large cap (top 100 companies by market cap) and midcap sized (101^st to 250^th companies by market cap). In a little over a year since its launch the fund has made a good start beating its benchmark index. In this article, we will review PGIM India Large and Midcap Fund.

Current market context

The domestic market is in recovery phase following President Trump administration's announcement of a 90 day pause on his administration's proposed tariffs on imports from the United States' trading partner. The market is hopeful that a mutually satisfactory resolution will be achieved on tariffs in the next 90 days. The Nifty is back above the 23,500 level and though there is a long way to the previous high, it seems that the market has bottomed out at least in the short term. The deep correction has led to valuations moderating across all market cap segments (see the graphic below). Current levels may provide attractive investment opportunities for long-term investors.

Source: NSE, Advisorkhoj research as on 31^st March 2025

Why invest in large and midcap funds now?

• Winners rotate market cap segments (see the chart below). It is difficult for investors to anticipate which market cap segment will outperform. Large and midcap funds allow investors to spread their investments across market cap segments
  
  

  

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



• Large and midcaps provide exposure to sectors where large caps will have no presence e.g. textiles, media, and entertainment etc. You can get richer diversification through large and midcap funds. Sectors with significant midcap presence can benefit from India's consumption driven economic growth, rising per capita income, changing global supply chain landscape, Government's policies following the global trade shifts due to Trump tariffs e.g., import substitution (Make in India), digitization, infrastructure spending, shift from unorganized to organized sectors etc. Large and midcap funds can provide investors exposure to a broader range of investment opportunities.


• Large and midcaps have decent participation in market upsides and at the same time, has also relatively provided downside protection (see the chart below) across investment cycles. In volatile markets, large and midcap funds may provide stable investment experience and may also create potential alpha in the investors' portfolios, over sufficiently long-term investment horizons.
  
  

  

  Source: NSE as on 22^nd April 2025



• In the current valuation scenario, large and midcap funds have the potential to make use of attractive investment opportunities across market cap segments, while sticking to their market cap mandate. This may result in long term wealth creation opportunities.

PGIM India Large and Mid-Cap Fund: Regular Growth Option

The PGIM India Large and Mid-cap fund has an AUM of 614.74 Crores (as on 31^st March 2025) with a TER of 2.33% (for the regular plan). The fund has outperformed its benchmark index since its inception.

Source: Advisorkhoj Research as on 22^nd April 2025

Fund outperformance vs the benchmark

• Rolling returns: The chart below shows the 1 year rolling returns of the PGIM India Large and Midcap Fund Vs its benchmark the Nifty Large and Midcap 250 TRI since the inception of the fund. As you can see that the fund has outperformed all throughout compared to its benchmark.
  
  

  

  Source: NSE, Advisorkhoj research as on 22^nd April 2025

Limited downside risks

The chart below shows the drawdowns on the fund relative to the benchmark index since the inception of the fund (as on 22^nd April 2025). You can see that the fund was able to limit downside risks for investors. The maximum drawdown experience by the benchmark was 19% Vs the scheme that was supported at 16% during this volatile period.

Source: NSE, Advisorkhoj, as of 22^nd April 2025

PGIM India Large and Midcap Fund – Stock Selection

Current Portfolio Construct

The portfolio has currently a large cap bias with more than 54% of portfolio holdings in large cap. Midcaps are around 40% and small caps less than 5%. The market cap allocations seem prudent in current market conditions. The rest of the portfolio is invested in cash and G-Secs.

Source: Fund Factsheet as of 31^st March 2025

Who should invest in PGIM India Large and Midcap Fund?

• Investors looking for capital appreciation and wealth creation.


• Investors should have at least 5-year investment horizon in this scheme.


• This fund ( may be suitable for new or first-time investors


• Investors with very high-risk appetites.


• You can invest in this scheme either through lump sum or SIP depending on your investment needs.

Investors should consult with their financial advisors or mutual fund distributors if PGIM India Large and Midcap Fund is suitable for their investment needs.