ICICI Prudential Mutual Fund has opened subscriptions for a new contra fund focusing on undervalued stocks, emphasising a research-led, patient approach to capitalise on market mispricings during turbulent times.
ICICI Prudential Mutual Fund has opened subscriptions for a new contra fund designed to back stocks the market has largely left behind. The open-ended equity scheme is built around a contrarian strategy, meaning it seeks out companies that are out of favour, overlooked or mispriced, with the aim of capturing value when sentiment turns. According to the fund house, the new fund offer runs from 28 September 2026 to 12 October 2026, with a minimum application amount of ₹1,000 and a benchmark of the Nifty 500 TRI.
The fund will be managed by Sankaran Naren, Dharmesh Kakkad and Sakshat Goel. ICICI Prudential says investors can choose between Growth and Income Distribution cum Capital Withdrawal options. The house describes the product as one focused on long-term capital appreciation, using a research-led process to identify turnaround opportunities across uneven market cycles.
At its core, contrarian investing is a bet that markets do not always price assets correctly. Rather than following momentum or crowd enthusiasm, the strategy looks for situations where a company’s share price has fallen sharply because of weak sentiment, temporary setbacks or sector-wide anxiety, even if the underlying business remains sound. In the TV9 Hindi explanation, Sankaran Naren said the approach is not simply about buying something because it is cheap; he said it requires strong research, patience and a willingness to wait for sentiment to change. He added that the scheme may invest across market capitalisations, but its main focus will be on stocks that have underperformed.
The investment case for such a fund depends on distinguishing a genuine recovery opportunity from a business that is structurally broken. According to the explanation provided by TV9 Hindi, the fund’s managers will look at whether a stock has fallen too far, whether the company’s fundamentals remain intact, whether the problem is temporary or lasting, and whether earnings could improve later. They may also assess balance-sheet strength, including debt-to-equity levels, institutional shareholding and sector disruptions, before deciding whether a holding deserves to stay in the portfolio.
ICICI Prudential also presents the fund as a response to a market environment where mispricing can appear in many places, from macroeconomic stress and geopolitical tensions to central-bank policy shifts, currency moves and earnings disappointments. The fund house argues that such uneven conditions can create openings for investors prepared to go against the grain. The TV9 Hindi report points to the United States as an example of concentrated market leadership, noting that the top 10 companies in the S&P 500 now account for a far larger share of the index than they did in 2016, whereas India’s market is broader but returns across sectors have been more mixed. That contrast, it says, may leave room for contrarian opportunities in India, especially in sectors that have lagged but could benefit from a cyclical recovery.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
