Invesco India PSU Equity Fund - Direct Plan

Reason for recommendation 

This is an open-ended equity scheme, which invests predominantly in equity of companies in which Central or State Governments have majority shareholding that is under the public sector undertakings

The fund’s portfolio has good mixture of various sectors. The major investment of the scheme is into the energy sector, which forms 48.25% of the corpus. This has been followed by the financial and service sector, which forms approximately 19% and 16% of corpus, respectively. The fund invests dominantly into the large-cap stocks and has allocated around 68% of the corpus towards it. 

The major holdings of the fund are in Power Grid Corporation, ONGC, Indian Oil and BPCL. The recent correction in these stocks has made its valuation very attractive. With the improving geo-political conditions, we see oil and gas stocks to revive in the upcoming days. Moreover, the policy measures in terms of the

NCLT and IBC is expected to revive the financial sector. So the presence of the stocks like SBI, Bank of Baroda, Indian Bank makes the scheme a value buy. So, we see this fund as a potential buy to generate better returns compared to other funds in the longer run. The fund is suitable for high-risk investors.