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DSP Mutual Fund launched DSP Nifty IT Index Fund and DSP Nifty Healthcare Index Fund, offering investors exposure to resilient sectors.
Defensive sectors such as Information Technology (IT) and Healthcare have historically exhibited low beta relative to the broader equity market, meaning they are less affected by market downturns, economic crises, or geopolitical events.
DSP Mutual Fund has introduced two new index funds: DSP Nifty IT Index Fund and DSP Nifty Healthcare Index Fund. These funds provide investors with a strategic opportunity to engage in sectors known for their stability compared to the broader equity markets.
Resilient Sectors: IT And Healthcare
Defensive sectors like Information Technology (IT) and Healthcare have historically shown low beta relative to the broader equity market. This means they are less impacted by market downturns, economic crises, or geopolitical events. For example, during the Global Financial Crisis (Jan–Oct 2008) and the Covid-19 pandemic (Jan–March 2020), the Nifty Healthcare and Nifty IT indices outperformed the broader Nifty 500 Index by experiencing smaller losses and quicker recoveries.
These sectors benefit from diversified global revenues, reducing their reliance on domestic economic cycles. To illustrate, approximately 96% of the total revenues for companies in the Nifty IT Index come from global markets, while around 52% of the revenues for companies in the Nifty Healthcare Index are internationally sourced. In comparison, only about 25% of the revenues for companies in the Nifty 50 Index come from global markets.
DSP Nifty IT Index Fund
The DSP Nifty IT Index Fund aims to replicate the Nifty IT Index by investing in the top 10 IT companies based on free float market capitalization. The Indian IT sector has shown steady earnings growth with relatively low earnings variability, which reduces earnings surprises. Over the past 12 years, the Nifty IT index has consistently outperformed many other sectors. Despite recent underperformance, historical cycles suggest a potential turnaround, making this an opportune moment for investors to consider sector-focused exposure.
DSP Nifty Healthcare Index Fund
The DSP Nifty Healthcare Index Fund seeks to replicate the Nifty Healthcare Index by investing in the top 20 Healthcare companies based on free float market capitalization. India’s healthcare market capitalization as a percentage of total market capitalization is among the lowest compared to developed and emerging markets. This presents significant growth potential as India’s healthcare infrastructure, insurance penetration, and medical innovation continue to expand.
The New Fund Offer (NFO) period for both funds will be open from June 2 to June 16, 2025.
Anil Ghelani, CFA, Head of Passive Investments & Products at DSP Mutual Fund, stated, “The launch of the DSP Nifty IT Index Fund and DSP Nifty Healthcare Index Fund offers investors a balanced approach to participate in sectors that combine growth with resilience. In uncertain market environments, defensive sectors like IT and healthcare have seen lower drawdowns, with the potential to deliver attractive returns.”
Gurjeet Kalra, Business Head – Passive Funds at DSP Mutual Fund, added, “By strategically including low-beta sectors such as Information Technology and Healthcare, investors can construct a more resilient and efficient portfolio, which may help them optimize returns and effectively manage market risk. Defensive sectors are currently underrepresented in broader indices, and history shows that when underweight, sectors like IT and Healthcare tend to outperform the market over the following year. Our disciplined passive management approach aims to closely track these sectors, helping investors capture structural growth with lower volatility.”
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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