ICICI Prudential Housing Opportunities Fund
Type of Scheme
An open ended equity scheme following housing theme.
Investment Objective
To generate long-term capital appreciation by investing in equity and equity related instruments of entities engaged in and/or expected to benefit from the growth in housing theme. However, there can be no assurance or guarantee that the investment objective of the Scheme would be achieved.
Liquidity
Being an open ended scheme, the Scheme will commence sale and redemption of Units on an on-going basis not later than 5 business days from the allotment date. The Scheme being offered is open-ended scheme and will offer Units for Sale / Switch-in and Redemption /Switch-out, on every Business Day at NAV based prices subject to applicable loads. As per the SEBI (Mutual Funds) Regulations, 1996, the Mutual Fund shall despatch redemption proceeds within 10 Business Days from the date of redemption. A penal interest of 15% p.a. or such other rate as may be prescribed by SEBI from time to time, will be paid in case the payment of redemption proceeds is not made within 10 Business Days from the date of redemption. Please refer to section 'Redemption of units' for details.
Benchmark
Nifty Housing Index
Transparency / NAV Disclosure
The AMC will calculate and disclose the first NAV within 5 business days from the date of allotment. Subsequently, the NAV will be calculated and disclosed at the close of every Business Day. The AMC shall prominently disclose the NAV of all schemes under a separate head on the AMC’s website and on the website of AMFI. NAV will be determined on every Business Day except in special circumstances. NAV of the Scheme shall be made available at all Customer Service Centres of the AMC. AMC shall update the NAV on the website of Association of Mutual Funds in India - AMFI (www.amfiindia.com) and AMC website (www.icicipruamc.com) by 11.00 p.m. on every business day. In case of any delay, the reasons for such delay would be explained to AMFI and SEBI by the next day. If the NAVs are not available before commencement of business hours on the following day due to any reason, the Fund shall issue a press release providing reasons and explaining when the Fund would be able to publish the NAVs. The Scheme Risk-o-meter shall be evaluated on a monthly basis and Mutual Funds/AMCs shall disclose the Risk-o-meter along with portfolio disclosure for all their schemes on their respective website and on AMFI website within 10 days from the close of each month. Any change in risk-o-meter shall be communicated by way of Notice cum Addendum and by way of an e-mail or SMS to unitholders of that particular scheme. The AMC shall disclose portfolio of the scheme (along with ISIN) as on the last day of the month / half-year on AMC’s website i.e. www.icicipruamc.com and on the website of AMFI within 10 days from the close of each month / half-year respectively. The AMC shall publish an advertisement in all India edition of at least two daily newspapers, one each in English and Hindi, every half year disclosing the hosting of the half-yearly statement of the scheme’s portfolio on the AMC’s website and on the website of AMFI. The AMC shall send via email both the monthly and half-yearly statement of scheme portfolio within 10 days from the close of each month / half-year respectively. The unitholders whose e-mail addresses are not registered with the Fund are requested to update / provide their email address to the Fund for updating the database. The AMC shall provide a physical copy of the statement of scheme portfolio, without charging any cost, on specific request received from a unit holder.
Loads
ENTRY LOAD:
Not Applicable.
In terms of SEBI circular no. SEBI/IMD/CIR No. 4/168230/09 dated
June 30, 2009 has notified that w.e.f. August 01, 2009 there will be
no entry load charged to the schemes of the Mutual Fund.
EXIT LOAD:
1% of the applicable NAV - If the amount sought to be redeemed or switched out is invested for a period of up to 1 month from the date of allotment.
NIL - If the amount sought to be redeemed or switched out is
invested for a period of more than 1 month from the date of
allotment.
The Trustees shall have a right to prescribe or modify the exit load
structure with prospective effect subject to a maximum prescribed
under the Regulations.
Minimum
Application Amount
DURING NEW FUND OFFER PERIOD/ DURING ONGOING OFFER
PERIOD:
Rs. 5,000/- (plus in multiple of Re. 1)
Minimum Switch –
In Amount
DURING NEW FUND OFFER PERIOD/ DURING ONGOING OFFER
PERIOD:
Rs. 5,000/- and any amount thereafter
Minimum
Additional
Application Amount
Rs. 1,000/- (plus in multiple of Re.1)
Minimum
Additional Switch In
Amount
Rs. 1,000/- and any amount thereafter
SIP Amount
Daily, Weekly, Fortnightly, Monthly SIP$ : Rs. 100/- (plus in multiple of Re. 1/-) Minimum installments:
6
Quarterly SIP$
: Rs. 5,000/- (plus in multiple of Re. 1/-)
Minimum installments – 4
STANDARD RISK FACTORS
Investment in Mutual Fund units involves investment risks such as trading volumes,
settlement risk, liquidity risk, default risk including the possible loss of principal.
As the price / value / interest rates of the securities in which the Scheme invests fluctuate, the value of your investment in the Scheme may go up or down.
The NAVs of the Scheme may be affected by changes in the general market conditions, factors and forces affecting capital market, in particular, level of interest rates, various markets related factors and trading volumes, settlement periods and transfer procedures.
Past performance of the Sponsors, AMC/Fund and their associates does not guarantee the future performance of the Scheme.
ICICI Prudential Housing Opportunities Fund is the name of the Scheme and does not in any manner indicate either the quality of the Scheme or its future prospects and returns.
The Sponsors are not responsible or liable for any loss resulting from the operation of the Scheme beyond the contribution of an amount of Rs. 22.2 lacs collectively made by them towards setting up the Fund and such other accretions and additions to the corpus set up by the Sponsors.
The Scheme is not a guaranteed or assured return Scheme.
All Mutual Funds and securities investments are subject to market risks and there can be no assurance or guarantee that the objectives of the Scheme will be achieved.
The NAV of the Scheme can go up or down depending on the factors and forces affecting the securities markets.
Mutual Funds being vehicles of securities investments are subject to market and other risks and there can be no guarantee against loss resulting from investing in Scheme.
As the liquidity of the Scheme’s investments could at times, be restricted by trading volumes and settlement periods, the time taken by the Scheme for redemption of units may be significant or may also result in delays in redemption of the units, in the event of an inordinately large number of redemption requests or of a restructuring of the Scheme’s portfolio. In view of this the Trustee has the right, at their sole discretion to limit redemptions (including suspending redemption) under certain circumstances.
Different types of securities in which the Scheme would invest as given in the Scheme information document carry different levels and types of risk. Accordingly the Scheme’s risk may increase or decrease depending upon its investment pattern. E.g. corporate bonds carry a higher amount of risk than Government securities.
The Scheme may invest in ADRs/GDRs, equity of overseas companies listed on recognized stock exchanges overseas and other securities in accordance with the provisions of SEBI Circular No. SEBI/IMD/CIR No. 7/104753/07 dated September 26, 2007 and SEBI/IMD/CIR No. 122577/08 dated April 8, 2008 and SEBI/HO/IMD/DF3/CIR/P/2020/225 dated November 5, 2020, and SEBI circular no. SEBI/HO/IMD/IMD-II/DOF3/P/CIR/2021/571 dated June 03, 2021 subject to a maximum of US$ 1 billion per mutual fund. Aggregate ceiling for investment by Mutual Funds in overseas Exchange Traded Fund (ETF(s)) that invest in securities is US $ 300 million per Mutual Fund. However, in case the overall industry limit of US$ 7 billion or such other limit as prescribed by SEBI has been breached, the Scheme would temporarily not invest in the overseas securities. Further, for investment in overseas ETFs overall industry limit of US$ 1 billion shall be considered. Scheme Information Document ICICI Prudential Housing Opportunities Fund 11
Investors may note that AMC/Fund Manager’s investment decisions may not be always profitable as the actual market movement may be at variance with the anticipated trend. The Scheme proposes to invest substantially in equity and equity related securities. The Scheme will, to a lesser extent, also invest in debt and money market instruments. The inability of the Scheme to make intended securities purchases due to settlement problems could cause the Scheme to miss certain investment opportunities. By the same rationale, the inability to sell securities held in the Scheme’s portfolio due to the absence of a well developed and liquid secondary market for debt securities would result, at times, in potential losses to the Scheme, in case of a subsequent decline in the value of securities held in the Scheme’s portfolio.
Liquidity risk - In case of abnormal circumstances it will be difficult to complete the square off transaction due to liquidity being poor in stock futures/spot market. However, the Scheme will aim at taking exposure only into relatively liquid stocks where there will be minimal risk to square off the transaction.
The AMC may, considering the overall level of risk of the portfolio, invest in lower rated/unrated securities offering higher yields. This may increase the risk of the portfolio.
SCHEME SPECIFIC RISK FACTORS 1. Risk factors associated with investing in housing business: The Scheme invests predominantly in equity / equity related instruments of entities engaged in and/or expected to benefit from growth in housing activities. The Scheme is thematic in nature, hence will be affected by the risks associated with the housing sectors. Owing to high concentration risk for thematic scheme, risk of capital loss is high. There is an element of unpredictable market cycles that could run for extended periods. Loss of value due to obsolescence, or regulatory changes coupled with structural rigidity of the Scheme can lead to permanent loss of capital. Thus, investing in a thematic fund could involve potentially higher volatility and risk. Investors may note that AMC/Fund Manager’s investment decisions may not be always profitable. Although it is intended to generate capital appreciation and maximize the returns by actively investing in equity/ equity related securities and utilising debt and money market instruments as a defensive investment strategy. At times, churning of portfolios may lead to substantial losses due to subsequent adverse developments in the capital markets or unfavourable market movements. In view of the same, there can be no assurance that the investment objective of the Scheme will be realised. In addition, the scheme is also subject to following specific risks:-
1. Changes in the policies of the Government of India or in the government of the states where the investee companies operate may have potential to adversely impact the operations of such companies in housing business. This may be aggravated considering that the sector being a state subject, there may be a lack of uniformity in guidelines across states. Some of the recent guidelines such as incorporation of Real Estate Regulatory Authority (RERA) across states are expected to help in improvement of governance in the sector.
2. The unavailability of raw material, fuel and labour, or an increase in their costs, may adversely affect results of operations of investee companies in housing business. Scheme Information Document ICICI Prudential Housing Opportunities Fund 12
3. Companies in real estate sector require regulatory approvals in the ordinary course of business failing which operations may get adversely impacted. Further, such companies have to be in compliance with environmental, health and safety laws and regulations. 4. The operations of the companies could be substantially affected by economic, political and other prevailing conditions in an economy. Prolonged slowdown in economic growth may have an adverse impact on the operations of the investee companies. 2. Investing in Equities
Investors may note that AMC/Fund Manager’s investment decisions may not be always profitable, as actual market movements may be at variance with anticipated trends. Trading volumes, settlement periods and transfer procedures may restrict the liquidity of these investments. Different segments of the financial markets have different settlement periods and such periods may be extended significantly by unforeseen circumstances. The inability of the Schemes to make intended securities purchases due to settlement problems could cause the Schemes to miss certain investment opportunities.
The value of the Schemes’ investments, may be affected generally by factors affecting securities markets, such as price and volume volatility in the capital markets, interest rates, currency exchange rates, changes in policies of the Government, taxation laws or any other appropriate authority policies and other political and economic developments which may have an adverse bearing on individual securities, a specific sector or all sectors including equity and debt markets. Consequently, the NAV of the Units of the Schemes may fluctuate and can go up or down.
The Mutual Fund may not be able to sell / lend out securities, which can lead to temporary illiquidity. There are risks inherent in securities lending, including the risk of failure of the other party, in this case the approved intermediary to comply with the terms of the agreement. Such failure can result in a possible loss of rights to the collateral, the inability of the approved intermediary to return the securities deposited by the lender and the possible loss of corporate benefits accruing thereon.
Investors may note that dividend is due only when declared and there is no assurance that a company (even though it may have a track record of payment of dividend in the past) may continue paying dividend in future. As such, the schemes are vulnerable to instances where investments in securities may not earn dividend or where lesser dividend is declared by a company in subsequent years in which investments are made by schemes. As the profitability of companies are likely to vary and have a material bearing on their ability to declare and pay dividend, the performance of the schemes may be adversely affected due to such factors.
While securities that are listed on the stock exchange carry lower liquidity risk, the ability to sell these investments is limited by the overall trading volume on the stock exchanges. The liquidity of the Schemes’ investments is inherently restricted by trading volumes in the securities in which it invests.
Fund manager endeavors to generate returns based on certain past statistical trend. The performance of the schemes may get affected if there is a change in the said trend. There can be no assurance that such historical trends will continue.
In case of abnormal circumstances it will be difficult to complete the square off
transaction due to liquidity being poor in stock futures/spot market. However, fund
will aim at taking exposure only into relatively liquid stocks where there will be
minimal risk to square off the transaction. The Schemes investing in foreign securities
will be exposed to settlement risk, as different countries have different settlement
periods.
The schemes are also vulnerable to movements in the prices of securities invested by the schemes which again could have a material bearing on the overall returns from the schemes.
Securities, which are not quoted on the stock exchanges, are inherently illiquid in nature and carry a larger amount of liquidity risk, in comparison to securities that are listed on the exchanges or offer other exit options to the investor, including a put option.
Changes in Government policy in general and changes in tax benefits applicable to
mutual funds may impact the returns to investors in the Schemes or business
prospects of the Company in any particular sector.
3. Investing in Fixed Income Securities
Market Risk/Interest Rate Risk: The Net Asset Value (NAV) of the Scheme(s), to the extent invested in Debt and Money Market securities, will be affected by changes in the general level of interest rates. The NAV of the Scheme(s) is expected to increase from a fall in interest rates while it would be adversely affected by an increase in the level of interest rates.
Liquidity Risk: The liquidity of a security may change depending on market conditions leading to changes in the liquidity premium linked to the price of the security. At the time of selling the security, the security can become illiquid leading to loss in the value of the portfolio.
Credit Risk: Investments in Fixed Income Securities are subject to the risk of an issuer's inability to meet interest and principal payments on its obligations and market perception of the creditworthiness of the issuer.
Price Risk: Government securities where a fixed return is offered run price-risk like any other fixed income security. Generally, when interest rates rise, prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fall or rise in the prices is a function of the existing coupon, days to maturity and the increase or decrease in the level of interest rates. The new level of interest rate is determined by the rates at which government raises new money and/or the price levels at which the market is already dealing in existing securities. The price-risk is not unique to Government Securities. It exists for all fixed income securities. However, Government Securities are unique in the sense that their credit risk generally remains zero. Therefore, their prices are influenced only by movement in interest rates in the financial system.
Settlement risk: The inability of the Scheme to make intended securities purchases due to settlement problems could cause the Scheme to miss certain investment opportunities. By the same rationale, the inability to sell securities held in the Schemes’ portfolio due to the extraneous factors that may impact liquidity would result, at times, in potential losses to the Plan, in case of a subsequent decline in the value of securities held in the Schemes’ portfolio
