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Inclusive Business
Published on: Feb. 13, 2020, 2:24 p.m.
HDFC AMC has leveraged on its expertise to launch a Debt Fund for cancer cure
  • Fund for cancer patients

By Business India Editorial

To support and aid underprivileged people suffering from cancer, HDFC Asset Management Company partnered with Indian Cancer Society (ICS) established in 1951, as India’s first voluntary, non-profit, National Organisation for Awareness, Detection, Cure and Survivorship of those affected with Cancer.

In addition to voluntary contribution, HDFC AMC leveraged on its investment expertise and launched HDFC Debt Fund for Cancer Cure in 2011, a first of its kind, mutual fund offering in India, dedicated to philanthropy. The idea of pooling investor/donor funds through a mutual fund structure was pioneered by the company through a three-year close-ended fund.

Under this fund, the subscription the AMC takes from investors is invested and returns thereof, in the form of dividends are donated to ICS. Donation of income to ICS is eligible for deduction U/S 80G of Income Tax Act, 1961. The principal raised is returned to the investors on maturity. HDFC AMC does not levy any investment and management fees to manage the fund for cancer cure.

Cancer in children constitutes 5.5 per cent of total cancer cases in India according to the Indian Council for Medical Research. This percentage has more than doubled from 2.5 per cent ten years ago. A disturbing reality, however, is that only around one in 10 of the childhood cancer cases receives complete therapy. As a consequence, while cure rates for common childhood cancers like lymphoma and leukaemia are over 80 per cent in the developed world, in India, they have remained abysmally low at around 30 per cent. More than 80 per cent of all childhood cancer cases occur in low- and middle-income countries.

The idea behind launching a cancer-dedicated fund was to create a corpus, invest and generate returns so as to provide financial assistance to ICS. The key element of the product has been its close-ended nature with a lock-in of three years thereby providing predictable and sustainable cash flows over the life of the product. With predictable cash flows, the ICS has been able to develop an efficient delivery structure to carry out its efforts for this cause. ICS has 16 affiliated hospitals to help cancer patients benefit from this programme. The needy patients through these affiliated hospitals are identified after thorough due diligence by a team of doctors and finally approved by Governing Advisory Council. The cancer patients identified have an annual income of less than Rs2 lakh. The maximum amount sanctioned per patient at Rs4 lakh invariably covers the entire cost of treatment in most cases and this helps the patient and the hospital start the treatment early.

The distribution and investor fraternity was not easily disposed to a Mutual Fund product aimed at philanthropy. Though initially challenging, the sales team showed remarkable adaptability in taking the Fund and the cause to the investors. The first launch of Rs77 crore was followed up with launches of Rs172 crore in 2014 and Rs302 crore in 2017, raising an aggregate of over Rs550 crore for this cause. With the enhanced acceptance of these funds over time, the AMC is confident of raising larger AUMs for the cause in future.

The donations from the three cancer cure funds have helped over 6,000 patients across India with 60 per cent of the beneficiaries less than 30 years of age, and 32 per cent of the total beneficiaries below 15 years of age. The total sanctioned amount exceeded Rs87 crore by September 2018. HDFC AMC donates an equal amount as a direct donation, to double the impact of the donations made by investors. Since inception, donation of dividends amounted to Rs58.94 crore, and the remaining amount was contributed by HDFC AMC.

The last concluded Fund, launched in 2017, will mature in May 2020. With the continuous support of this initiative, the number of beneficiaries is expected to rise to 8,000 by 2020.

HDFC AMC aims to continue with its efforts in this direction by launching a fourth series of the fund in the year 2020, which will continue to support cancer patient on a sustainable basis.

Inclusix not only promises long-term business gains for CRISIL and gives a fillip to its brand name, but also helps drive overall inclusive growth agenda for India.

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