Special Situations Fund launched by Axis Mutual Fund


Axis special situations fund is a NFO from the house of Axis Mutual Fund.

It would be an open equity scheme predominantly following special situations theme.

The fund would be open for subscription from December 04, 2020 to December 18, 2020.

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NFO details for Axis Special Situations Fund

Scheme Opens


Scheme Closes


Fund Manager

Mr. Ashish Naik

Mr. Hitesh Das



Minimum Investment (Lumpsum)


Fund Category


Exit Load

If redeemed/switched out within 12 months – For 10% of investments :Nil. For remaining investment 1%. If redeemed/switched out after 12 months from date of allotment – Nil.


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Axis Special Situations Fund Investment Objectives

The investment objective of this fund is to attain long term growth while investing predominantly in stocks based on special situations theme.

There is no guarantee that the investment objective of the fund would be realized.



Axis Special Situations fund Allocation

The asset allocation for this special situations fund would be something like this

Asset Class

Minimum %

Maximum %

Equity and Equity related instruments of Special situations theme



Other Equity and Equity related instruments



Debt and money market instruments



Units issues by REITS and InvITs




The above figures are only indicative and not fixed, the fund manager has the liberty to move across the asset classes depending upon prevailing market conditions as long as they remain within the mandate permitted.

The fund can also invest in REITs and InvITs if so desired.


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Axis Special Situations fund Suitability

This fund is suitable for investors:

  1. Seeking capital appreciation over long term.
  2. Seeking investment in stocks based on special situations theme.
  3. Who have an investment horizon of 5 years or more.


What are special situation funds?

A special situation fund is a mutual fund scheme that seeks to take advantage of opportunities presented by unique situations or challenges a sector, business or overall economy may face.

These unique situations are rare and come with a limited shelf life as far as an attractive valuation is concerned.

Equity investing is more about the valuation rather than the price.

A special situation fund attempts to benefit from this drop in price which as mentioned above may have a very limited shelf life.

Unlike other mutual funds, a special situation fund is on the lookout for such events and therefore finds it easier to capitalize on such events as opposed to other mutual funds who are not.

When you seek opportunities, you find opportunities and when you seek hurdles, you find hurdles.


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What are special situations?

Special situations could mean any of the following but not restricted to these:

Company Events

This could be related to:

  1. A whistleblower incident
  2. Corruption or bribery charges
  3. Any fine by the respective authorities
  4. Change in management


Industry events

This could be related to:

Any new regulatory changes affecting how the business is run.

For example A chemical plant being examined on higher levels of testing standards or government restricting export of a particular product.

A new entrant or an existing participant bringing about a new product that disrupts the entire industry.

For example Zomato and Swiggy changes the way people order their food in.


Macro-Economic events

This could be related to:

Inflation, a higher inflation rate could affect the prices of anything that is consumption driven but is discretionary.

Let’s say that retail inflation affects prices of vegetables which in turn affects the prices of snacks which is consumption driven but at the same time discretionary, meaning something that can be ignored if necessary.

This would affect sales which would then in turn also reflect in the company share price.

This could be a temporary phase for both the company and also its share price thereby allowing the fund manager a very attractive time to enter the stock.


Regulatory changes

Let’s say India has had a poor monsoon which in turn affected harvests.

To overcome the shortfalls, the government bans export of tomatoes.

This would adversely affect companies that produce and export tomato related food products.

This would affect the company’s sales both due to a prohibition on sales as well as if the exchange rates were in their favour.


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Understanding Special situations

Special situations with regards to effect can be divided into

  1. Short term
  2. Medium term
  3. Long Term


Short term

If the CEO of a company resigns then this could and in most cases does reflect negatively in the company’s share price as well.

This should not however not always show the company in a bad picture but that’s how the markets function.

The CEO could have resigned due to personal reasons and despite that the share prices took a tumble.

This is what you call a short term disruption allowing the fund managers to enter the stock at an attractive valuation.


Medium Term

In November 2016, the government of India announced demonetisation of currency notes of valuation Rs 500 and 1,000.

Ever since then online payment apps and software systems supporting them have seen a rise in their business.

Cash in circulation by 2019 was still at the same levels as around the time of demonetisation but at least for that specific period in between, the immediate months after the announcement in particular did see a spike in online payments as opposed to cash payments.


Long Term

On September 20, 2019 the Government of India announced a tax cut to Corporate tax from 30% to 22% and from 25% to 15% for new manufacturing companies.

This was intended with the purpose to encourage more investments and growth.

The real effect of this would be seen in the long run and not immediately.


Disruptions creating special situations

Disruptions could be man-made like say:

  1. Change in government, political policies
  2. Wars etc.
  3. Economic policy changes like new or additional tariffs


Natural like say:

  1. Floods
  2. Climate change
  3. Earthquake etc.


Disruption of any type affects the overall economy in general and certain sectors more specifically.

Disruptions are usually immediate but the after effects of it could range from short term to long term.

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Disclaimer : While due precaution has been undertaken in the preparation of this article, The Mutual Fund Guide or any of its authors will not be held liable for any investments based on the above article. The above article should not be considered financial advice and has been published only for your perusal. Due credit has been given in case wherever required, in case you feel any part violates any rights then do get in touch with us and we shall get it duly removed.  
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