The only thing
constant in life is change, and the evolution of human civilization is an example of that. Over the
centuries, we have discovered, learned and innovated, improving every aspect of our lives. We have used our
knowledge of science and technology to invent new products, create new processes, and improve existing ones
to create a better world.
In several sectors like Technology Services & Industrial
Automation, Retail, Banks, Pharma & Healthcare Services, Telecom and internet service, Specialty / Agro
Chemicals, etc., businesses are rapidly innovating to provide better products and services. Be it
introducing smarter options or creating affordable options or upgrading an existing product or completely
changing the way we obtain information, work, learn, communicate, shop, invest and more, innovation is at
the root of every change we experience.
Several innovation platforms are likely to
revolutionize the world in the next few years in diverse fields. We are already seeing the impact and the
innovation is going to be more pronounced as they advance further. Artificial Intelligence, robots, switch
to electric vehicles, food aggregator apps, genome editing, blockchain technology, agri-tech, co-living
spaces, online homestay and experiences, shared workspaces and more are set to completely transform our
lives. Innovation need not be technology-led always. It could just be a new way of looking at problems and
finding unique solutions.
When these innovations take off, they can completely change
every aspect of our lives. They may also create tremendous growth for these companies. These companies that
are daring to think differently might create good value for their shareholders over time.
How can you as an investor hope to benefit from the growth of these innovators? How will you be able to
pick the right ones to invest in at an early stage and stay invested with the aim to reap potential returns
over the long term?
Here is where investing in ICICI Prudential Innovation Fund can
come in handy. The objective of the scheme is to generate potential returns by investing in equity &
equity related securities of companies and units of global mutual funds/ETFs that can benefit from
innovation strategies and themes. The scheme may invest without any market cap bias in small, mid and
large-cap companies based on the market opportunities. The scheme will not restrict itself to any particular
sector/theme and will invest in companies involved in product/services/solution related innovation. This may
also help you diversify your portfolio. And may help to manage your risk better while offering you scope for
potential long term growth.
India has an ambitious goal of becoming a net zero-carbon
economy by 2030. This will require becoming self-sufficient in renewable energy as well as switching to
electric vehicles. Similarly, other industries are also switching to advanced technologies to generate
efficiencies.
The switch to innovative strategies benefits the end consumer as it
improves the quality of life and offers accessibility to affordable solutions. Innovations need to reach all
sections of the population to improve the overall quality of life. The easy and affordable access to a
smartphone and cheap internet data is a case in point. The increasing demand for innovative solutions has
led to the promotion of the growth of innovation as a theme. Investing in the ICICI Prudential Innovation
Fund could be a smart way invest in companies that promote innovation which have long term growth
potential.
What is the investment
process?
The scheme will follow a detailed investment process with the
first step being identifying trends in a particular sector or theme by sector/theme analysts. These trends
will be reviewed and evaluated by the fund managers along with the analysts. Post this, a broad stock
universe is shortlisted based on the innovation trends. Based on this, companies will be assessed on
qualitative parameters like Management execution track record, strategic partnership etc. Apart from this
qualitative assessment, a quantitative assessment is also carried out basis FCF, OCF, impact on margins
etc., The sectors are allocated, after considering macro factors like Govt. push, Global environment etc.
Finally, based on sector & stock weightages, final portfolio is constructed.
Why should Innovation be considered an investible
theme?
We saw how the pandemic triggered a wave of innovation as
businesses were forced to adapt to a new lifestyle. The speed at which changes were introduced as processes
to manage work, education, healthcare, consumption and every other aspect of life is a good indicator of the
pace at which innovation can happen. In today’s uncertain world marred by geo-political tension and high
inflation, countries are moving towards self-sufficiency, reducing dependence on others which further
expands the scope for innovation.
The scheme will be managed by professional fund
managers who have a good track record. So, what are you waiting for? By investing in the ICICI Prudential
Innovation Fund, you can participate in the exciting growth journey of an array of companies across the
theme having an innovative edge. A good way to participate in the growth that innovators may achieve is by
investing in a mutual fund scheme like ICICI Prudential Innovation Fund that aims to identify these
companies.
Invest in the ICICI Prudential Innovation Fund and aim to enjoy the
exciting ride.
