HDFC Defence Fund adds Cochin Shipyard & INDO-MIM, increases stake in HAL, Mazagon Dock, 5 others

HDFC Defence Fund, the only actively managed fund based on defence sector, added Cochin Shipyard and INDO-MIM in its portfolio as new entrants in July and increased its stake in HAL, Mazagon Dock Shipbuilders and five other stocks in the same period, according to the monthly portfolio disclosed by ACE MF.

The defence sector based fund added 3 lakh shares of Cochin Shipyard worth market value of Rs 42 crore and nearly 3.30 lakh shares of INDO-MIM worth market value of Rs 25 crore in July.

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The exposure was increased in nearly 10 stocks in July. Around 1.25 lakh shares of Hindustan Aeronautics were added to the portfolio taking the total count to 28.50 lakh in July against 27.25 lakh shares in the previous month.

Around 2.10 lakh shares of Mazagon Dock Shipbuilders were added to the portfolio and the fund had 15 lakh shares in its portfolio in July compared to 12.89 lakh in the previous month. Among the other five stocks where the fund increased its stake, a maximum number of shares of Bharat Electronics were added.

The fund added 25 lakh shares of Bharat Electronics in its portfolio and had 4.05 crore shares in its portfolio in July compared to 3.80 crore in June. Nearly 10 lakh shares of Tata Motors were added to the portfolio and the fund had 21 lakh shares in its portfolio in July.

Nearly 8.96 lakh shares of Ideaforge Technology, 66,532 shares of Bharat Forge and 4,776 shares of Bosch were added to the portfolio in the month of July.

Cyient DLM, Aequs and Power Mech Projects were three stocks where the fund reduced its stake in July. The fund sold 35 lakh shares of Aequs from its portfolio and had 5 lakh shares in its portfolio in July compared to 40 lakh shares in the previous month.

It sold 3.53 lakh shares of Cyient DLM and 4,025 shares of Power Mech Projects from its portfolio in the month of July.

The exposure remained unchanged in nearly 12 stocks which include some names such as BEML, Eicher Motors, Centum Electronics, Premier Explosives, Astra Microwave Products, Solar Industries, Diffusion Engineers, MTAR Technologies, Bharat Dynamics, Data Patterns (India), Sedemac Mechatronics, and JNK India.

As a percentage of NAV, the fund had the highest allocation in Bharat Forge of around 14.82%, followed by Bharat Electronics and Hindustan Aeronautics where the allocation was 14.67% and 12.37% respectively.

In July, the fund had 24 stocks in its portfolio compared to 22 stocks in the previous month. The portfolio of the fund is spread across seven sectors such as capital goods, automobiles & ancillaries, chemicals, electricals, shipbuilding, telecom and infrastructure.

The fund had an AUM of Rs 10,709 crore as of July 31, 2026. Launched on June 2, 2023, the performance is benchmarked against Nifty India Defence - TRI and is managed by Rahul Baijal and Priya Ranjan.

The fund had the highest allocation of 50.64% in capital goods sectors, followed by automobiles & ancillaries where the allocation was 22.77% and 13.84% respectively.

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The fund has completed over three years in the market and has failed to outperform its benchmark in the longer horizon whereas has outperformed its benchmark in the shorter horizon. In the last three months, the fund delivered 11.11% return compared to 7.14% by the benchmark.

The fund delivered 26.82% in the last six months compared to 23.25% by the benchmark. It gave 29.93% in the last one year against 26.45% by the benchmark. In the last three years, the fund delivered a return of 40.36% against 49.76% by the benchmark. Since its inception, the fund has delivered a CAGR of 41.67%.

Around 42.88% was invested in the large caps, 25.42% was in mid caps, 29.73% in small caps and 1.97% in others.

HDFC Defence Fund is an open-ended equity scheme investing in Defence & allied sector companies. The investment objective of the fund is to provide long-term capital appreciation by investing predominantly in equity and equity related securities of Defence & allied sector companies.

The fund is suitable for investors who are seeking to generate long-term capital appreciation/income and want investment predominantly in equity and equity related instruments of defence and allied sector companies.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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