Kotak Mahindra Asset Management Company has launched the Kotak Services Fund, an open-ended equity scheme targeting India's services sector. According to reports from The Hindu BusinessLine, the New Fund Offer opens on February 4, 2026, and closes on February 18, 2026, with a minimum investment of ₹1,000. The fund will invest across market capitalizations in service-oriented businesses spanning consumer services, telecom, healthcare, logistics, financial services, IT, power, and oil & gas sectors. As per Angel One, the scheme is actively managed and seeks long-term capital appreciation, subject to market conditions.
The investment objective of the Kotak Services Fund is to provide long-term capital appreciation from a portfolio of equity and equity related securities of services sector companies. According to Angel One, there is no assurance that the stated objective will be achieved. The benchmark index for measuring performance is the Nifty Services Sector TRI. The scheme allows exposure to equity and debt instruments in line with its stated investment framework.
The equity and overseas investments of the scheme will be managed by Mr Rohit Tandon, while the debt component of the portfolio will be handled by Mr Abhishek Bisen. As reported by Angel One, the scheme is structured as an open-ended equity fund falling under the Equity Schemes thematic fund category. The investment strategy follows a Growth at Reasonable Price approach combined with a bottom-up Business, Management, Value framework. Nilesh Shah, Managing Director of Kotak Mahindra Asset Management Company, emphasized that India's services economy is undergoing a structural shift driven by rising incomes, greater digital adoption, and expanding urbanization.
An exit load of 0.5% is applicable on redemption or switch out within 90 days from the date of allotment. No exit load is charged for redemptions on or after 90 days. The minimum initial purchase amount for non-SIP investments is ₹1,000, with additional purchases allowed from ₹100. SIP investments can start from ₹500. According to Angel One, units will be available for subscription during the NFO period.
India's services sector contributes 55 per cent to the country's Gross Value Added and employs 31.5 per cent of the workforce as of FY25, according to data from IMF, World Bank, and MOSPI. The sector is experiencing growth driven by rising incomes, digital adoption, and urbanization. Fund Manager Rohit Tandon emphasized that the services theme offers both stability and growth through its breadth across consumption-driven and export-driven segments. He noted that the services sector represents one of the most compelling combinations of resilience and scalability in India's market landscape, with portfolio construction leaning toward companies that have proven their ability to sustain margins, upgrade business models, and deploy capital judiciously.
According to The Economic Times, experts typically advise investors to avoid investing in NFOs unless they offer something unique. Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited noted that while the fund is built around India's services-led growth story, a dedicated service-sector fund may not provide valuable diversification as it increases portfolio risk. Nikunj Saraf, CEO, Choice Wealth pointed out that the fund's core theme of investing in companies deriving majority revenues from services is a wide universe, not limited to one or two industries. The fund aims to participate in businesses where growth comes from scale, networks, data, technology and consumer demand rather than heavy capital expenditure.
