Bajaj Finserv AMC launches Small Cap Fund targeting quality, growth and value

Bajaj Finserv Asset Management Company (AMC) has launched the Bajaj Finserv Small Cap Fund, an open-ended equity scheme focused on small-cap stocks.

The New Fund Offer (NFO) will open for subscription on June 27 and close on July 11.

The fund aims to combine three investment strategies—quality, value, and growth—while selecting stocks. It will invest primarily in companies with strong fundamentals, competitive advantages, and businesses trading below intrinsic value due to temporary market corrections.

According to the AMC, the recent correction in small-cap stocks has created a valuation gap, offering a potential entry point for long-term investors. Despite over 80% of small-cap companies reporting a 38% rise in profits, many stocks continue to trade 15–45% below their 52-week highs.
The fund will follow a structured selection process, filtering out companies with weak governance or inconsistent financials. From a universe of over 1,100 small-cap companies, it aims to build a portfolio of 40 to 100 stocks, based on internal forensic and risk-aware analysis.

Ganesh Mohan, Managing Director at Bajaj Finserv AMC, said the launch reflects their conviction in the long-term growth potential of small-cap companies. “With the recent small cap correction, the NFO is poised to take advantage of this opportunity, enabling investors to participate in long-term wealth creation,” he said.

Nimesh Chandan, Chief Investment Officer, added that many small-cap businesses are trading at lower valuations despite strong earnings. “Our new fund will focus on quality businesses with scalability that are available at reasonable valuations,” he said.

The fund is benchmarked against the BSE 250 SmallCap Index TRI. It will be managed by Nimesh Chandan and Sorbh Gupta for equities, while Siddharth Chaudhary will manage the debt portion. The minimum investment is ₹500, and the fund offers both Growth and IDCW options. An exit load of 1% applies for redemptions within six months from the date of allotment.

The AMC noted that it already manages small-cap investments through other strategies and has increased its allocation to small caps in existing funds. For instance, its Flexi Cap Fund’s small-cap exposure rose from 21.8% in January to 26% in May 2025.

The fund is suitable for investors looking to build long-term wealth through exposure to small-cap equities. Investors are advised to consult their financial advisers before investing.