What is Axis Equity Advantage Fund and Axis Flexi Cap Fund?

What is the Investment focus of Axis Equity Advantage Fund – Series 1?

Axis Equity Advantage Fund – Series 1 is a close ended fund with a diversified portfolio of predominantly equity and equity related instruments across market cap spectrum.

The portfolio was built utilizing a bottom-up stock selection process, focusing on appreciation potential of individual stocks from a fundamental perspective.

What is the Investment focus of Axis Flexi Cap Fund?

Axis Flexicap Fund seeks to invest in high conviction ideas with improved risk- adjusted return characteristics. The fund manager looks for stocks that are expected to report faster growth relative to the benchmark without a market cap bias. The fund as such is sector agnostic and focuses on a bottom up approach to invest in stocks that are at an inflection point such as market share gain, industry consolidation, sunrise industries, improved management focus and capital allocation or regulatory & policy changes.

What is the rationale for the proposed Merger of the two schemes?

The merger of Axis Equity Advantage Fund - Series 1 with Axis Flexi cap fund is being proposed keeping in mind the similar investments strategy and stock selection process followed by two schemes to maintain a similar investment style/strategy. The merger is proposed with a view to provide investors of AEAF1 a continuation of their equity investments with the added liquidity advantage of an open-ended fund.

Both the schemes are managed by Mr. Shreyash Devalkar as the Fund Manager for the Equity allocation in the fund and he will continue to be the Fund Manager for the surviving scheme. There is no change in the investment philosophy/process or style for Axis Flexi Cap Fund. The Flexi Cap scheme will benefit from the inflow of new investors and funds.

With the Covid 2nd wave peaking and a renewed push by the government to vaccinate the country, we remain positive on equity markets. Our portfolio companies, encompass a cross section of growth ideas ideally suited to benefit from gaps left by weaker incumbents and capture opportunities. The core portion of our portfolio consists of companies that emphasize quality which we continue to hold on to. The hallmark of our investment philosophy is to endeavor to identify consistent long term growth and the Axis Flexi Cap Fund portfolio is positioned accordingly.

What will the merger do to existing schemes. Will a new scheme be formed?

No. The merger will not result in the emergence of any new scheme as Axis Equity Advantage Fund – Series 1 will be merged in the Surviving Scheme, viz. Axis Flexi Cap Fund. The tenure of the Merging Scheme (EAF1) is 1590 days from allotment date, this is getting over and the scheme is being subsumed into Axis Flexi Cap Fund.
Post-merger, the investments under the Surviving Scheme will be in accordance with the investment objective and asset allocation of the Surviving Scheme, i.e. Axis Flexi Cap Fund. All the provisions such as Investment Objective, Asset Allocation, Investment Strategy, Expense Ratio, etc. of Scheme Information Document of Axis Flexi Cap Fund shall be applicable to the merging scheme.

What are the tax implications for the scheme?

The two schemes are Equity oriented schemes, and hence the merger will allow the investors to take cost of acquisition and period of holdings from the investments into the original fund for taxation purposes as per the provisions of the Act.

For detailed information and implications, please refer this Notice on Merger of Schemes.

What needs to be done by unitholders of Axis Equity Advantage Fund – Series 1, if they want to remain invested into the merged Axis Flexi Cap Fund?

No action needs to be taken by the unitholder to continue to remain invested, It shall be deemed as consent given by them for the proposed merger. However if the unit holder does not agree, he has an option to exit the scheme. No exit load shall be applicable on such switch/redemption.
For detailed information, please refer this Notice on Merger of Schemes.

What will be the applicable exit load to units allotted from Axis Equity Advantage Fund – Series 1 post-merger?

There will be no exit load applicable for such units. Upon allotment of units in the Merged Scheme, all provisions under the Merged Scheme will apply. However, the period of holding for the purpose of exit load, if any, will be computed from the date of allotment of corresponding original units in the Merging Scheme .

How will the Plans and Options be allocated to the unitholders of AEAF1?

Plan/option wise allocation of units will be as follows:

For detailed information on the schemes and the changes, please refer this Notice.

Axis Equity Advantage Fund – Series 1
(A close ended equity scheme)
This product is suitable for investors who are seeking*
• Capital appreciation while generating income over medium to long term.
• Investment in equity and equity related instruments as well as debt and money market instruments while managing risk through active asset allocation.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Investors understand that their principal will be at very high risk

Axis Flexi Cap Fund (An open ended dynamic equity scheme investing across large cap, mid cap, small cap stocks)
This product is suitable for investors who are seeking*
• Capital appreciation over medium to long term.
• Investment in a dynamic mix of equity and equity related instruments across market capitalization.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Investors understand that their principal will be at very high risk

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.