Matthews India Fund

  • Unconstrained all-cap strategy focused on companies with a sustainable competitive edge and pricing power, which are able to perform throughout economic cycles
  • Fundamental bottom-up approach to seek well-run entrepreneurial companies with sustainable organic growth and trustworthy managements


Inception Date


YTD Return (USD)

(as of 05/12/2022)



(as of 05/12/2022)


1 Day NAV Change

(as of 05/12/2022)


Seeks to achieve long term capital appreciation.


The Fund seeks to achieve its investment objective by investing, directly or indirectly, at least 65% of its total net assets, in publicly traded common stocks, preferred stocks and convertible securities of companies located in India, and may invest the remainder of its net assets in other permitted assets on a worldwide basis.


The value of an investment in the Fund can go down as well as up and possible loss of principal is a risk of investing. Investments in international, emerging and frontier market securities may involve risks such as social and political instability, market illiquidity, exchange-rate fluctuations, a high level of volatility and limited regulation, which may adversely affect the value of the Fund's assets. The Fund invests in holdings denominated in foreign currency, and is exposed to the risk that the value of the foreign currency will increase or decrease. The Fund invests primarily in equity securities, which may result in increased volatility. Investments in a single-country fund may be subject to a higher degree of market risk than diversified funds because of concentration in a specific country.

These and other risks associated with investing in the Fund can be found in the prospectus.

Fund Facts
Inception Date 30/06/2011
Fund Assets $23.75 million (31/10/2022)
Base Currency USD
ISIN: LU0594557885 (USD) LU0594558263 (GBP)
Benchmark S&P Bombay Stock Exchange 100 Index
Geographic Focus India
Fees & Expenses
Management Fee 0.75%
Total Expense Ratio As of 31/03/2022 1.00% ( USD ) 1.00% ( GBP )


  • Monthly
  • Quarterly
  • Calendar Year
  • Rolling 12 Month
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As of 31/10/2022
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews India Fund (USD)
-0.58% -1.81% -9.06% -10.87% 9.51% 5.67% 9.13% 6.57% 30/06/2011
S&P Bombay Stock Exchange 100 Index (USD)
3.01% 0.96% -4.89% -5.73% 11.02% 7.30% 9.34% 6.49%
Matthews India Fund (GBP)
-4.57% 3.71% 7.10% 7.34% 14.14% 8.79% 12.93% 9.78% 30/06/2011
S&P Bombay Stock Exchange 100 Index (GBP)
-0.03% 7.13% 12.29% 12.44% 15.58% 10.50% 13.13% 9.71%
As of 30/09/2022
Average Annual Total Returns
Name 1MO 3MO YTD 1YR 3YR 5YR 10YR Since Inception Inception Date
Matthews India Fund (USD)
-2.31% 7.31% -8.53% -11.35% 10.99% 6.51% 8.94% 6.68% 30/06/2011
S&P Bombay Stock Exchange 100 Index (USD)
-5.60% 6.85% -7.66% -9.07% 11.06% 8.15% 8.66% 6.26%
Matthews India Fund (GBP)
2.86% 17.71% 12.24% 8.52% 15.28% 10.82% 13.26% 10.31% 30/06/2011
S&P Bombay Stock Exchange 100 Index (GBP)
-1.18% 16.92% 12.33% 10.01% 14.80% 12.24% 12.78% 9.79%
For the years ended December 31st
Name 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012
Matthews India Fund (USD)
24.00% 18.20% 2.66% -9.78% 37.88% -3.05% -2.73% 54.46% -4.82% 28.80%
S&P Bombay Stock Exchange 100 Index (USD)
24.08% 13.92% 8.53% -6.00% 41.88% 2.32% -6.41% 31.40% -4.70% 28.62%
Matthews India Fund (GBP)
25.60% 14.19% -0.37% -4.76% 25.78% 16.54% 2.28% 63.93% -6.94% 23.43%
S&P Bombay Stock Exchange 100 Index (GBP)
25.15% 10.68% 4.30% -0.23% 29.51% 22.13% -1.02% 39.60% -6.59% 22.36%
For the period ended 30/09/2022
Name 2022 2021 2020 2019 2018 Inception Date
Matthews India Fund (USD)
-11.35% 58.31% -2.58% 5.14% -4.64% 30/06/2011
S&P Bombay Stock Exchange 100 Index (USD)
-9.07% 57.47% -4.34% 8.11% -0.09%
Matthews India Fund (GBP)
8.52% 50.90% -6.45% 11.36% -2.05% 30/06/2011
S&P Bombay Stock Exchange 100 Index (GBP)
10.01% 51.03% -8.94% 14.74% 2.63%

Source: Brown Brothers Harriman (Luxembourg) S.C.A.

Since inception performance for share classes with less than one year of history represents actual performance, not annualised. In addition, for share classes less than a year old, Year to Date Return is calculated since inception. Where no past performance is shown there was insufficient data available in that year to provide performance.

Performance details provided are based on a NAV-to-NAV basis with any dividends reinvested, and are net of management fees and other expenses. Performance data has been calculated in the respective currencies stated above, including ongoing charges and excluding subscription fee and redemption fee you might have to pay.

All performance quoted represents past performance and is not indicative of future performance. Investors may not get back the full amount invested. Investors investing in funds denominated in non-local currency should be aware of the risk of currency exchange fluctuations that may cause a loss of principal.

Additional performance, attribution, liquidity, value at risk (VaR), security classification and holdings information is available on request for certain time periods.

Portfolio Characteristics

(as of 31/10/2022)
Fund Benchmark
Number of Positions 46 101
Weighted Average Market Cap $44.3 billion $62.2 billion
Active Share 52.9 n.a.
P/E using FY1 estimates 24.9x 22.3x
P/E using FY2 estimates 20.4x 18.9x
Price/Cash Flow n.a. 15.0
Price/Book 4.1 3.4
Return On Equity 16.1 18.1
EPS Growth (3 Yr) 11.7% 22.7%

Sources: Factset Research Systems, Inc.

Risk Metrics (3 Yr Return)

(as of 31/10/2022)
Upside Capture
Downside Capture
Sharpe Ratio
Information Ratio
Tracking Error

Fund Risk Metrics are reflective of Class I USD ACC shares.

Sources: Zephyr StyleADVISOR

Top 10 Holdings

(as of 31/10/2022)
Name Sector % Net Assets
ICICI Bank, Ltd. Financials 7.2
HDFC Bank, Ltd. Financials 6.6
Infosys, Ltd. Information Technology 5.8
Bajaj Finance, Ltd. Financials 5.4
Tata Consultancy Services, Ltd. Information Technology 4.1
Reliance Industries, Ltd. Energy 4.0
Hindustan Unilever, Ltd. Consumer Staples 3.5
Maruti Suzuki India, Ltd. Consumer Discretionary 3.4
Shriram City Union Finance, Ltd. Financials 3.3
IndusInd Bank, Ltd. Financials 3.3
TOTAL 46.6

Top 10 holdings may combine more than one security from the same issuer and related depositary receipts.
Source: Brown Brothers Harriman (Luxembourg) S.C.A

Portfolio Breakdown (%)

(as of 31/10/2022)
  • Sector Allocation
  • Market Cap Exposure
Sector Fund Benchmark Difference
Financials 38.1 34.5 3.6
Consumer Discretionary 15.1 7.7 7.4
Information Technology 12.9 12.7 0.2
Industrials 8.9 6.1 2.8
Consumer Staples 7.9 9.4 -1.5
Materials 6.2 7.9 -1.7
Health Care 6.2 3.7 2.5
Energy 4.0 11.3 -7.3
Utilities 0.0 3.4 -3.4
Communication Services 0.0 2.9 -2.9
Real Estate 0.0 0.4 -0.4
Cash and Other Assets, Less Liabilities 0.8 0.0 0.8

Sector data based on MSCI’s revised Global Industry Classification Standards. For more details, visit

Equity market cap of issuer Fund Benchmark Difference
Mega Cap (over $25B) 50.5 68.9 -18.4
Large Cap ($10B-$25B) 11.9 18.5 -6.6
Mid Cap ($3B-$10B) 20.5 12.2 8.3
Small Cap (under $3B) 16.3 0.4 15.9
Cash and Other Assets, Less Liabilities 0.8 0.0 0.8

Source: FactSet Research Systems unless otherwise noted.
Percentage values in data are rounded to the nearest tenth of one percent, so the values may not sum to 100% due to rounding. Percentage values may be derived from different data sources and may not be consistent with other Fund literature.


  • 3 YEAR
  • 5 YEAR
  • 10 YEAR
(as of 28/07/2022)

Past performance is no guarantee of future results. High ratings and rankings does not assure favorable performance.

Overall Morningstar RatingTM is reflective of the noted share class. Fund ratings represent an opinion only and are not a recommendation to buy or sell any fund. Copyright ©2022 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is provided for reference purposes only.

The Overall Morningstar®️ Rating for a fund is derived from a weighted-average of the performance figures associated with its three-, five- and (if applicable) ten-year ratings.

Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

Portfolio Managers

Peeyush  Mittal, CFA photo
Peeyush Mittal, CFA

Lead Manager

Sharat  Shroff, CFA photo
Sharat Shroff, CFA



Period ended 30 September 2022

For the quarter ending 30 September 2022, the Matthews India Fund returned 7.31%, while its benchmark, the S&P Bombay Stock Exchange 100 Index, returned 6.85%.

Market Environment:

Despite steep monetary policy-tightening by the U.S. Federal Reserve this year, inflation continues to be very sticky implying the Fed will have no choice but to continue down its rate-rising path. This environment is creating very high volatility in both developed and emerging-market currencies, including India’s.

Given the swift depreciation of the euro and the British pound recently, it’s fair to expect that some of the nations that export to these economies are going to be negatively impacted as purchasing power in the Western bloc erodes over time. Europe is also far behind in its monetary policy journey compared with the Fed and it needs to do far more to tame inflationary pressures. The fiscal and monetary policies of Britain further complicate the situation after the government’s tax-cutting stimulus plan alarmed investors and caused the Bank of England to intervene to stabilize gilt yields.

In the face of these global macro challenges India continues to be very resilient. A separate concern has been the impact of an erratic monsoon that has disrupted Kharif, the traditional second harvest of the year. Sowing recovered late in the quarter, however, it’s not clear if the crop yields will be of the usual standard.

Better news has been that the prices of many hard and soft commodities have corrected substantially year-over-year and this will provide support to consumption going forward not just in India but globally.

And despite rising interest rates, auto and real estate sales have been fairly robust as both sectors are recovering from multi-year slowdowns and there is good pent-up demand coming back into the market. We are also seeing job growth in the services sector as COVID concerns recede and mobility begins to normalize. The travel and hospitality industry, particularly, seems to have returned to pre-COVID volumes which is leading to strong employment generation.

Performance Contributors and Detractors:

At the sector level, our underweight in energy was the biggest contributor to relative performance in the quarter as energy firms generally were hurt by a correction in the price of oil from very high levels. Our allocation and stock selection within consumer discretionary was also a top contributor as consumer demand in India remained robust. On the other hand, our stock selection within industrials and consumer staples were the biggest detractors to performance. The negative impact of our stock selection in industrials was mitigated to a degree by our overweight position.

At an individual holdings level, among the top contributors to performance in the quarter were IndusInd Bank and Lemon Tree Hotels. IndusInd Bank, a commercial lender, has benefited from an improvement in growth outlook and credit costs for key lending verticals like autos and microfinance. Lemon Tree Hotels is gaining from normalization in travel which is leading to occupancy levels returning to pre-COVID numbers. There’s also a supply-demand mismatch in the travel and leisure industry which is creating disproportionate pricing power for hoteliers and leading to a sharp recovery in average rental revenues. Given the high fixed-cost nature of the business there’s a high probability of continued positive surprise to earnings—and not just for Lemon Tree Hotels but for the hospitality industry in general.

Conversely, information technology stocks were among the biggest detractors in the quarter, as companies including Tata Consultancy Services and Infosys were hurt by softening demand from clients in Western economies. Bandhan Bank was also a detractor. The floods in the northeastern state of Assam and the less-than-normal rainfall in states like Bihar and West Bengal will have an adverse impact on credit quality for the bank in the short term. Bandhan is also going slow on growing its microfinance book which implies growth in profits may be behind FY23 expectations.

Notable Portfolio Changes:

Amid the rising interest rate environment our recent focus has been to reduce exposure to small caps and consolidate exposure to companies we believe will deliver higher growth for a longer period. To this end, we exited Quess Corp., an outsourcing services provider, and Zydus Wellness, which offers nutrition and skincare products—both small caps and businesses in which we had concerns about management execution and governance. We also exited Divis Laboratories, a pharma company, and Birlasoft, an IT business. We think both companies will face growth challenges and their valuations aren’t reflecting this.

We also initiated a position in Titan in the quarter. With its exposure to jewelry and high-end watches, Titan is one of the few luxury brands in India and we believe it’s well positioned to benefit from discretionary consumption. We expect the company to show sustained growth over the long term which, to a certain degree, justifies the stock’s current high valuation.


We believe that prices have peaked globally and it’s only a matter of time before reported inflation numbers start to come down. Prices of most globally traded hard and soft commodities have fallen from their highs even though they continue to be significantly above levels seen 12 months ago. The Chinese government is also introducing measures to stimulate its economy which will help to ease global supply chain-inflationary pressures. It all suggests to us that the pace of monetary policy tightening globally is set to slow even if the process of tightening is prolonged.

For India’s economy, energy costs continue to pose the main threat to a cyclical recovery. High oil prices together with weaker exports to Europe and U.K. are going to create a wider current account deficit than most economists expect, in our view, which in turn will lead to further rupee depreciation against the U.S. dollar. Against this backdrop, however, India’s economic data continues to be strong. We have seen a consistent pickup in credit growth over the past recent months, indicating a broad-based economic recovery.

Our biggest concern for India equities is valuation. Monetary policy tightening over the last six months has meant that the equity risk premium—the excess return that investing in the stock market may provide over a risk-free rate—has compressed dramatically. With the near-term outlook suggesting further rate hikes ahead the only way for normalized levels of equity risk premium to return is for markets to correct. Hence, we have a cautious outlook.

Rolling 12 Month Returns For the period ended 30/09/2022 - I (Acc)
Name 2022 2021 2020 2019 2018 Inception Date
Matthews India Fund (USD)
-11.35% 58.31% -2.58% 5.14% -4.64% 30/06/2011
S&P Bombay Stock Exchange 100 Index (USD)
-9.07% 57.47% -4.34% 8.11% -0.09%
Matthews India Fund (GBP)
8.52% 50.90% -6.45% 11.36% -2.05% 30/06/2011
S&P Bombay Stock Exchange 100 Index (GBP)
10.01% 51.03% -8.94% 14.74% 2.63%

Sources: Brown Brothers Harriman (Luxembourg) S.C.A, Matthews Asia, FactSet Research Systems, Bloomberg


Performance figures discussed in the Fund Manager Commentary above reflect that of the Institutional Accumulation Class Shares and has been calculated in USD. Performance details provided for the Fund are based on a NAV-to-NAV basis, with any dividends reinvested, and are net of management fees and other expenses. Past performance information is not indicative of future performance. Investors may not get back the full amount invested.

The information contained herein has been derived from sources believed to be reliable and accurate at the time of compilation, but no representation or warranty (express or implied) is made as to the accuracy or completeness of any of this information. Matthews Asia and its affiliates do not accept any liability for losses either direct or consequential caused by the use of this information.

Information contained herein is sourced from Matthews Asia unless otherwise stated. The views and opinions in this commentary were as of the report date, subject to change and may not reflect the writer’s current views. They are not guarantees of performance or investment results and should not be taken as investment advice. Investment decisions reflect a variety of factors, and the managers reserve the right to change their views about individual stocks, sectors, and the markets at any time. As a result, the views expressed should not be relied upon as a forecast of the Fund’s future investment intent. It should not be assumed that any investment will be profitable or will equal the performance of any securities or any sectors mentioned herein. The information does not constitute a recommendation to buy or sell any securities mentioned.

Investors should not invest in the Fund solely based on the information in this material alone. Please refer to the Prospectus for further details of the risk factors. 

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