Zerodha Fund House has launched India's first target-date mutual funds, marking a significant milestone in the country's mutual fund industry. According to reports from CNBC TV18 and Business Standard, the fund house has introduced two schemes - Zerodha Life Cycle Fund 2036 and Zerodha Life Cycle Fund 2041 - with maturity periods of 10 years and 15 years respectively. These schemes represent the first target-date maturity funds in India, offering investors a structured approach to long-term wealth creation through automatic asset allocation adjustments. The launch comes after Sebi introduced lifecycle funds as a new category in February 2026 to expand goal-based investment solutions, helping investors align investments with specific financial milestones such as retirement, children's education or home purchase.
The funds employ a lifecycle approach where asset allocation changes automatically over time, gradually shifting from higher-risk equity portfolios in initial years to more conservative allocations as the target year approaches. As reported by CNBC TV18 and Business Standard, the schemes will invest in equities by tracking the Nifty LargeMidcap 250 Index, while debt exposure will be through Indian government securities across different maturities. The funds will also provide exposure to commodities and arbitrage strategies, creating a diversified investment approach across multiple asset classes. According to Business Standard, these funds are open-ended, allowing investors to enter at any point depending on the remaining maturity and their financial goals. Unlike life cycle funds in the National Pension System (NPS), these funds are not linked to the investor's age or specific goals, making them flexible for various investment horizons.
According to CNBC TV18, globally, target-date funds manage assets of more than $4 trillion and are widely used as retirement investment vehicles. The schemes will be treated as equity funds for taxation purposes throughout their lifecycle, with no lock-in period and a minimum investment amount of ₹100. CEO Vishal Jain stated that the mutual fund industry has historically been organized around products, believing the next phase will be organized around goals. He emphasized that target-date funds, as a category, have transformed long-term investing globally, and expressed excitement about introducing something similar to Indian investors for the first time, believing it has the potential to become the default long-term investment option for a generation of Indian investors. As reported by Business Standard, asset-allocation rebalancing happens at the fund level and does not create capital gains tax implications for investors, with the fund retaining allocation to arbitrage to maintain equity taxation even at maturity.
The new fund offer (NFO) for both schemes opened on 19 June and will close on 7 July, as reported by CNBC TV18. Chief Business Officer Vaibhav Jalan explained that the funds are designed around specific investment horizons, with asset allocation remaining aligned to the chosen target year. The fund house indicated that additional Life Cycle funds with different maturity years may be launched in the future, expanding the product range based on investor demand and market response to this innovative investment approach. Business Standard reports that ICICI Prudential Asset Management Company has also filed with Sebi for the launch of three life cycle funds maturing in 2031, 2036 and 2041, indicating growing industry interest in this new category. The two Zerodha schemes will invest in a mix of asset classes including equity, debt and commodities like gold and silver, with some arbitrage exposure too.
