Launched in October 1986, UTI Mastershare Unit Scheme is India’s first equity-oriented fund. It has a track record of wealth creation of over 35 years. UTI Mastershare Unit Scheme is an open-ended equity scheme which predominantly aims to invest in large cap companies having competitive advantage in their respective fields. It follows an investment style of Growth at Reasonable Price (GARP) for stock picking. This means that, given the underlying growth in earnings of a company, a reasonable price is to be paid to buy that stock in the portfolio.The Fund aims to invest in companies that are fundamentally strong with controlled borrowings, consistent revenue growth, focus on profitability, higher return on capital than cost of capital and consistent operating cash-flows generation.
Owing to this combined approach of GARP plus Competitive Franchise, UTI Mastershare Unit Scheme may invest in companies where (1) the market is underestimating the companies’ ability to sustain growth over the long term or the benefits of pricing power, (2) the growth trajectory is improving through industry wide phenomena like favourable demand cycle, consolidation, clearances of regulatory hurdles or through company specific factors like cost competitiveness and prudent capacity expansion, (3) the business is capital intensive but the companies invest prudently and execute efficiently, (4) the companies having opportunities to reinvest cash flows at high Return on Capital Employed (RoCE), (5) the relative valuation within the sector is attractive. This provides the investors an opportunity to create along-term wealth by owning a portfolio of quality companies.UTI Mastershare Unit Scheme has a portfolio of leading companies and the top 10 stocks account for about 47% of the portfolio. The Scheme is currently overweight on Automobile and Auto Components, Healthcare, Consumer Services, Telecommunication and Capital Goods and underweight on Oil, Gas & Consumable Fuels, FMCG, Metals & Mining, Power and Financial Services as of July 31, 2022.
The Fund has a corpus of over Rs. 10,136-crore with over 7.38-lakh live investor accounts as on July 31, 2022. The Fund aims at obtaining capital appreciation/ or income distribution over a long-term, follows a disciplined approach to invest as stated above and has maintained a stream of annual dividends every year since its inception. UTI Mastershare Unit Scheme has distributed a total dividend of more than Rs. 4,200-crore.The scheme has a lower portfolio churn. UTI Mastershare Unit Scheme has generated a return (CAGR) of 15.60% against the return of 14.26% by the benchmark S&P BSE 100 TRI since inception as on July 31, 2022. Furthermore, an investment amount of Rs. 10-lakh made in the fund at its inception has grown to Rs.17.99-crore as against Rs.11.83-crore as per benchmark S&P BSE 100TRI during the same period, i.e., generating around180 times returns over the last 35 years.
