Axis Mutual Fund has announced the launch of its new thematic offering, the Axis Nifty India Defence Index Fund. This is an open-ended scheme which will focus on tracking the Nifty India Defence Total Return Index (TRI).
The new fund offer (NFO) will open for subscription today (10 April) and close on 24 April, as detailed in a recent press release.
Objectives of the fund
The fund seeks to generate returns, before expenses, that closely track its benchmark index, subject to tracking errors. This product is developed as a passive investment vehicle. It offers investors a cost-effective and transparent way to gain exposure to the nation’s rapidly evolving defence sector. The investments in the defence sector gain even greater importance given the ongoing Middle East war and the Russia-Ukraine war, which are creating ripples in global geopolitics.
The introduction of NFO comes amid a structural upswing in global and domestic defence spending. Across the world, defence sector spending has crossed $2.7 trillion, driven primarily by geopolitical tensions and a shifting global order.
India is also witnessing a strong momentum with its defence budget rising nearly 2.7 times since FY14 to about ₹6.8 lakh crore in FY26, reflecting sustained policies and regulations focused on strengthening military capabilities.
Domestic tailwinds, such as policy support, increased private-sector participation, enhanced foreign direct investment limits, and the government’s push for self-reliance under ‘Atmanirbhar Bharat’, are further boosting the sector. Furthermore, defence exports have also grown sharply, rising from under ₹2,000 crore in FY17 to over ₹23,000 crore in FY25, signalling increasing global acceptance of India’s defence manufacturing capabilities.
The fund will replicate its benchmark index, which includes companies engaged in aerospace and defence equipment, shipbuilding, explosives and allied services. The index follows a rules-based methodology and is rebalanced semi-annually.
CEO Views
Commenting on the launch, B Gopkumar, MD & CEO, Axis AMC, said, “India’s defence sector is undergoing a multi-year transformation, supported by rising budgets, strong policy intent, and expanding export opportunities. Through the Axis Nifty India Defence Index Fund, we are offering investors a low-cost, rules-based way to participate in this structural growth theme.”
He added that the fund is well-suited for long-term investors looking to align their portfolios with India’s strategic and manufacturing priorities.
The scheme will be managed by fund managers Nandik Mallik and Rohit Gautam. However, given its thematic nature, investors should be prepared for higher volatility in the short to medium term and consider a long-term investment approach, preferably through systematic investment plans.
Disclaimer: This content is for informational purposes only and does not constitute investment advice or a recommendation. Investors should carefully read the offer document and consult a qualified financial advisor before making any investment decisions.
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