PGIM India Small Cap Fund Regular Growth INF663L01W30

PGIM India Small Cap Fund earns an Average Process Pillar rating.

The leading factor in the rating is the continuity of management across its parent firm. The firm's asset-weighted manager tenure of 15 years demonstrates its ability to retain portfolio managers. The size of the portfolio management team also bolsters the process. With four portfolio managers, the fund is reasonably well-resourced. However, the process is limited by the parent firm's five-year risk-adjusted success ratio of 47%. The measure indicates the percentage of a firm's funds that have beat their respective category's median return for the period. The parent's modest success ratio suggests that the firm could do better across its fund lineup.

This strategy has tended to hold more growth stocks than others in the Small-Cap Morningstar Category. But in terms of size exposure, it is similar to the average. Examining additional factor exposure, this strategy has consistently favored high-quality stocks, including those with low financial leverage and solid returns on equity, compared with Morningstar Category peers during recent years. This means the fund holds consistently profitable, growing companies with solid balance sheets that may help it endure downturns better than Morningstar Category peers. In recent months, the strategy was more exposed to the Quality factor compared with its Morningstar Category peers as well. Given the high trading volume of holdings, this strategy has been exposed to liquid assets during these years. This gives the managers more flexibility during bear markets to sell without adversely affecting prices. Compared with category peers, the strategy also had more exposure to the Liquidity factor in the most recent month. Additionally, this strategy has had lower yield exposure than peers, with the portfolio holding fewer stocks with high dividend or buyback yields over these years. This is demonstrated by the portfolio's low exposure to dividends or buybacks. While companies with high yields provide consistent income payments, they may cut payouts if their earnings fall. In recent months, the strategy also had less Yield factor exposure than its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section.

The portfolio is overweight in healthcare and basic materials relative to the category average by 6.5 and 4.1 percentage points, respectively. The sectors with low exposure compared with category peers are technology and financial services, underweight the average by 4.4 and 2.6 percentage points of assets, respectively. The portfolio is composed of 63 holdings and is relatively top-heavy. Of the strategy's assets, 26.7% are concentrated within the top 10 holdings, as opposed to the typical peer's 13.7%. And finally, in terms of portfolio turnover, looking at year-over-year movements, 85% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.