Jupiter India Fund

Most of the best-selling funds on Fidelity Personal Investing tend to have fairly mainstream mandates, so it is very unusual for Jupiter India, with its single country focus, to regularly make it into the top ten. The reason for its popularity is that clients believe that the potential more than makes up for the higher risk.

Why invest in India?

Indian equities have performed strongly in the last few years due to a combination of robust economic data, supportive government policies and steadily growing corporate earnings. The International Monetary Fund (IMF) expects gross domestic product (GDP) to increase by 7% in the 12 months to 31 March 2025, which would make it the fastest growing major economy in the world.¹

Prime Minister Narendra Modi was returned to power for a third five-year term following the general election in the summer and his new government has already unveiled a fiscally prudent Budget with policies that continue the pattern of reform. This has enabled many domestically-oriented companies to experience healthy earnings growth.

Objective and approach

Jupiter India aims to generate a return, net of fees, higher than that provided by its MSCI India benchmark over the long-term, which is defined as a period of five years or more. Its manager, Avinash Vazirani, has extensive experience of investing in the country and uses a ‘Growth at a Reasonable Price’ approach.

The strategy has really paid off, as the recent outperformance was mainly driven by superior rates of aggregate earnings growth of the holdings relative to those in the benchmark. Some of the deeply undervalued stocks in the fund have also begun to attract more investor interest and now trade at a level that better reflects their intrinsic value.²

What are the manager’s latest views?

Writing in the annual accounts at the end of July, the manager said that the Indian stock market has delivered good returns in recent years, but valuations in some pockets have become unreasonable even in the context of the superior earnings growth.³

“Using our consistent and patient ‘growth at a reasonable price’ approach, we are still able to identify plenty of attractively valued companies that we believe have the potential to deliver better earnings growth returns for investors than the broader market over time. We think this combination of similar or better earnings growth and lower valuation offers a compelling reason to invest with us in India, particularly for valuation conscious investors.”

The underlying portfolio

At the end of September the £2.1bn fund had a total of 90 holdings, with 57.4% of the assets invested in large cap stocks and the rest divided between the mid and smaller end of the spectrum. The main sector weightings were: Financials 22.1%, Health Care 12%, Energy 11.7%, Consumer Staples 11.4% and Industrials 11.4%.⁴

Jupiter India top 10 holdings

1. Godfrey Philips India
2. Bharat Petroleum
3. State Bank of India
4. Indian Oil Corp
5. HCL Technologies
6. HDFC Bank
7. Interglobe Aviation
8. Fortis Healthcare
9. Bharti Airtel
10. Tata Motors

Source: Jupiter India fund factsheet, 31.7.24 

Performance and outlook

Jupiter India has built up an impressive track record with a five-year increase to the end of September of 125.7%, compared to 96.8% from the benchmark. In the last three years it has achieved an unusually high Information Ratio of 1.41%, which suggests that the manager has been able to consistently generate excess returns relative to the risk.⁵ Please remember past performance is not a reliable indicator of future returns.

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. Overseas investments will be affected by movements in currency exchange rates. Investments in emerging markets can be more volatile than other more developed markets. Reference to specific securities should not be construed as a recommendation to buy or sell these securities and is included for the purposes of illustration only. This fund uses financial derivative instruments for investment purposes, which may expose the fund to a higher degree of risk and can cause investments to experience larger than average price fluctuations. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.