Tata Asset Management launches multi-cap consumption index fund: Key things investors must know

The new Tata BSE Multicap Consumption 50:30:20 Index Fund, an open-ended scheme, is designed to replicate and track the BSE Multicap Consumption 50:30:20 Index (TRI), providing a mix of potential stability and growth in India’s evolving consumption story.

The New Fund Offer (NFO) opens on December 8, 2025, and closes on December 23, 2025.

Anand Vardarajan, Chief Business Officer, Tata Asset Management, said, “Consumption is a long-term structural theme for India. However, the nature of consumption is shifting from basic needs to lifestyle and aspirational spending. Where the rich spend today, the middle class will spend there tomorrow. While Large Caps offer stability and brand leadership, true wealth creation potential often lies in mid- and small-caps which represent emerging consumption themes like quick commerce, travel, and digital entertainment. The 50:30:20 construct – 50% large-caps, 30% mid-caps, 20% small-caps – aims to offer investors a transparent, rule-based way to participate in the entire consumption ecosystem without the concentration risk often seen in traditional sector funds.”

Key differentiators of the Fund:

• Built-in Diversification: Unlike existing indices that are heavily biased toward large-caps (often more than 90%), this fund ensures meaningful exposure to mid- and small-caps (50% allocation combined)

• Wider Sectoral Coverage: The multi-cap strategy captures niche industries often underrepresented in conventional indices, such as auto ancillaries, digital entertainment, tour and travel services, and internet retail

• Captures the 'New Age' Consumer: With rising disposable incomes and a clear shift toward discretionary and premium spending, the fund is positioned to benefit from the ‘premiumisation’ of the Indian consumer

The entry load does not apply to the scheme. An exit load of 0.25% is applicable if redeemed on or before 15 days from the date of allotment. The minimum subscription amount is Rs 5,000 and in multiples of Re 1 thereafter.

• Methodology: The index comprises the top 100 stocks from the BSE 500 universe in consumer discretionary and FMCG, selected using capped float-adjusted market-cap weighting and grouped into large-, mid- and small-cap segments with a mandated 50:30:20 structure.

• Weightage: Index constituents are weighted based on their float-adjusted market capitalisation. Stocks in the index are classified into either large, mid or small groups based on whether the stock belongs to the BSE 100 LargeCap TMC Index, BSE 150 MidCap Index or BSE 250 SmallCap Index.

• Rebalancing: The index would be reconstituted and rebalanced Semi-annually in June and December. The top 80 stocks automatically remain in the index. Stocks ranked 81 to 120 are retained in order of highest rank until the target constituent count of 100 is reached.

Established in 1994, Tata Asset Management Private Limited is the investment manager for Tata Mutual Fund. It is one of the oldest mutual funds in India.