Kotak Mahindra Mutual Fund is taking applications for the Kotak Nifty Realty Index Fund, a passive fund that will buy the 10 real estate companies in the Nifty Realty Index. The new fund offer (NFO) runs from 26-10-2026 to 09-11-2026 at ₹10 a unit.
It aims to match the index’s total returns before expenses. Any small gap between the two is called tracking error.
For investors, it puts listed developers such as DLF, Godrej Properties and Lodha Developers in one fund from ₹1,000, so you do not have to pick stocks yourself.
Also read: New Fund Offer (NFO): Meaning, Types & Myths Busted
Kotak Nifty Realty Index Fund NFO details
Particulars | Details |
Fund name | |
Fund type | Open-ended index fund (passive) |
Category | Other schemes: index funds |
Nature of scheme | Open-ended scheme replicating or tracking the Nifty Realty Index |
Benchmark | Nifty Realty Index (Total Return Index) |
Fund managers | Jeetu Valechha Sonar and Satish Dondapati (equity); Abhishek Bisen (debt portion) |
NFO opens | 26-10-2026 |
NFO closes | 09-11-2026 |
Allotment & reopening date | On or around 17-11-2026 (5 working days after NFO closes) |
Minimum investment | ₹1,000 and any amount thereafter |
Additional investment | ₹1,000 and any amount thereafter |
SIP amount | ₹500 per systematic investment plan (SIP) instalment, minimum 2 |
NAV | ₹10 per unit during the NFO (NAV is the price of one unit) |
Stamp duty | 0.005% |
Entry load | Nil (No fee charged when investing or buying units) |
Exit load | Nil (No fee charged when redeeming or switching out units) |
Fund house details: Kotak Mahindra AMC
Particulars | Details |
AMC name | Kotak Mahindra Asset Management Company Ltd |
Assets under management | ₹6,46,073 crore (as of February 2024, Dezerv) |
Website | |
Not Available | |
Registered office | 27 BKC, C-27, G Block, Bandra Kurla Complex, Bandra (E), Mumbai 400051 |
Contact number | 1800 309 1490 / 044 4022 9101 |
Source: AMFI India New Fund Offer: Kotak Nifty Realty Index Fund
What has Kotak Mutual Fund launched?
This is an open-ended index fund: a mutual fund that copies a market index instead of relying on a manager’s stock picks.
The Nifty Realty Index holds 10 NSE-listed companies, drawn from the Nifty 500, that mainly build homes, offices and other commercial property.
The objective is to match the index’s total returns (price changes plus dividends) before expenses. The scheme information document (SID) is clear that this is not guaranteed.
Nobody at Kotak picks stocks here. The fund holds what the index holds, in the same proportions, plus a small cash buffer.
The SID notes it is Kotak’s only index fund built around real estate developers.
Also read: A Comprehensive Guide to Mutual Funds in India
How does this index fund’s strategy work?
NSE Indices Limited builds the index, and Kotak mirrors it.
Step | What happens? |
1. Screening | Nifty 500 realty companies qualify if they traded on 90% of days over six months and have been listed for a month. |
2. Selection | The 10 largest by free-float market capitalisation (the value of shares the public can trade) make the cut. |
3. Weighting | Weights follow free-float size, capped at 33% per company and 62% for the top three at each rebalance. |
4. Deployment | Kotak invests NFO money in the same stocks and weights within 30 business days of allotment. |
5. Daily flows | Purchases and redemptions are matched by buying or selling index stocks in proportion. |
6. Review | The index is reviewed twice a year (cut-offs 31 January and 31 July). The fund realigns within 7 calendar days. |
Tracking error measures how far the fund’s daily returns stray from the index over a year. The SID caps it at 2%.
Understanding the NFO through an example
Say Ritu, a 41-year-old bank officer in Pune, puts ₹10,000 into the NFO. After the 0.005% stamp duty (about 50 paise), she gets roughly 999.95 units at ₹10 each.
Using index weights from 07-07-2026, about ₹1,966 of her money would sit in DLF, ₹1,733 in Phoenix Mills and ₹291 in Sobha, with the rest across the other seven. Actual weights will differ on investment day, as prices move.
If a review swaps a company out, Ritu does nothing. The fund sells the outgoing stock and buys the new one for her.
Portfolio allocation and current index holdings
Instrument | Minimum | Maximum |
Equity and equity-related securities of the Nifty Realty Index | 95% | 100% |
Debt and money market instruments | 0% | 5% |
Derivatives (up to 20% of equity) are allowed only briefly, such as during rebalancing. The fund will not buy foreign securities, InvITs or securitised debt, and cannot short sell.
The index on 07-07-2026, per the SID:
Company | Index weight (%) |
DLF | 19.66 |
Phoenix Mills | 17.33 |
Lodha Developers | 13.29 |
Prestige Estates Projects | 12.76 |
Godrej Properties | 12.24 |
Oberoi Realty | 10.32 |
Brigade Enterprises | 4.32 |
Anant Raj | 3.84 |
Aditya Birla Real Estate | 3.34 |
Sobha | 2.91 |
Investment strategy: tracking the Nifty Realty Index
There is no stock selection. The fund holds index stocks at index weights, whatever their valuation, and does not move to cash to time the market.
Guardrails come from SEBI rules for sectoral indices: at least 10 stocks, no stock above 35%, and each stock trading on at least 80% of days.
Up to 5% can sit in money market instruments or liquid funds to meet redemptions, which are paid within 3 working days.
The base expense ratio, the yearly fee taken from the fund, is capped at 0.90%. The Direct Plan is cheaper as it pays no distributor commission.
Potential benefits of this realty index fund
Potential benefit | Why does it matter? |
10 listed developers in one fund | Spreads money across the sector’s largest names (diversification within one sector) without company research. |
Published rules | You can see why a stock is in or out. |
Weight caps | No company can exceed 33% at a rebalance. |
Low entry amount | ₹1,000 lump sum or ₹500 SIP. |
Nil exit load | Redeem on any business day without an exit charge. |
Easy switching | Switch in from other Kotak schemes (except ETFs) during the NFO; systematic transfer and withdrawal plans later. |
Who may consider this NFO?
Investor type | Why it may fit |
Investors with a diversified equity core | It adds one sector to a portfolio that already has a core fund. |
Those with an investment horizon of seven years or more | The SID targets long-term growth; in our view, property cycles take years to play out. |
Fans of rules-based investing | The portfolio follows index rules, not a manager’s calls. |
SIP investors | A ₹500 SIP builds the position gradually. |
People wanting realty exposure without buying another flat | Small amounts, redeemable on any business day. |
Who may not find this fund suitable?
Investor type | Why it may not fit |
Anyone needing the money within five years | A single-sector fund needs time; debt or hybrid funds match short goals better. |
First-time investors with no core fund | A sector fund works better as an add-on once a core fund is in place. |
Those wanting a manager to skip weak companies | The fund must hold every index stock. |
Income seekers | It aims for growth; income payouts (IDCW) are not assured. |
Households already heavy in property | In our view, it adds more of what they own. |
How does a realty index fund compare with traditional options?
Feature | Fixed deposit | Debt mutual fund | Hybrid fund | Equity mutual fund | This NFO |
Return potential | Fixed, known upfront | Moderate; moves with interest rates | Moderate | Market-linked | Market-linked, tied to one sector |
Liquidity | Early exit may cost a penalty | Business days | Business days | Business days | Business days; nil exit load |
Investment horizon | Deposit tenure | Months to a few years | 3+ years | 5+ years | 7+ years (our view) |
Suitable investor | Wants certain income | Wants liquid parking | Wants balanced growth | Wants long-term wealth | Wants a real estate slice |
NFO review by Zenith Finserve
Most Indian families know real estate through the flat they live in or plan to buy. This NFO offers another route in: shares of the companies that build those homes and offices, at a capped cost.
It fits as a satellite holding for goals seven or more years away, such as a child’s postgraduate fees in 2034, sized as a modest part of your equity money. With 10 stocks and half the index in three names, it is a narrow holding that belongs beside a diversified core.
HDFC, Nippon India and Tata already run funds on this exact index, so the choice rests on cost and tracking quality. Before investing, check how much property you already own and whether a sector fund suits your goals.
How Zenith Finserve can help
At Zenith Finserve, we follow a process driven investment framework. We assess your goals, cash flows, risk profile, time horizon, existing investments, loans and tax situation before suggesting investments. We align our investment suggestions with your financial objectives and review them periodically to keep them suitable as your circumstances change.
Read more about Zenith Finserve, or see how our mutual fund advisory works.
Similar NFOs on Zenith and how this fund compares
Open NFOs covered by Zenith Finserve
- Axis Nifty EV & New Age Automotive Index Fund: Details & Review: another single-theme index fund; closes 30-10-2026.
- Quant Nifty Midcap 150 Index Fund NFO: Details & Review: a far broader midcap index fund; closes 26-10-2026.
- Quant Nifty 50 Index Fund NFO: Details & Review: a large cap core option a sector fund could sit beside; closes 26-10-2026.
Comparison with existing Nifty Realty index funds
Fund | Mandate | Costs | Liquidity | Track record |
Kotak Nifty Realty Index Fund (NFO) | Nifty Realty Index (TRI) | Base expense ratio up to 0.90%; exit load nil | Open-ended; NAV on business days | Not available (new fund) |
Same index | Expense ratio 1.00% Regular, 0.54% Direct; exit load not applicable | Open-ended; NAV on business days | Launched 26-03-2024; dated returns not shown by AMC | |
Same index | Expense ratio not shown by AMC; exit load nil | Open-ended; NAV on business days | Launched 04-12-2024; 1 year: -2.89% (Regular) vs index -1.88%, as on 30-09-2026 | |
Same index | Base expense ratio 0.90% Regular, 0.39% Direct (30-09-2026); 0.25% exit load within 15 days | Open-ended; NAV on business days | Launched 26-04-2024; 1 year: -2.77% (Regular) vs index -1.88%, as on 30-09-2026 |
Why these three: all track the same index. HDFC has the longest record, Nippon India is the newest, and Tata publishes plan-wise costs.
Data from each AMC’s website, checked 23-10-2026. Past performance may or may not be sustained in future.
Also read: Should you invest in a New Fund Offer (NFO)?
Frequently Asked Questions
1. Is Kotak Nifty Realty Index Fund NFO good to invest in?
That depends on your portfolio more than on the NFO. The fund copies the Nifty Realty Index, so its results will closely follow those 10 realty stocks, minus costs. It may suit you if you already hold a diversified equity fund, want a small real estate slice and can stay invested for seven years or more. Note that the ₹10 NFO price does not make these units cheaper than units of an existing fund.
2. When does the Kotak Nifty Realty Index Fund NFO open and close?
The NFO opens on 26-10-2026 and closes on 09-11-2026, as per Morningstar India’s NFO listing; the SID itself leaves the dates blank. Units should be allotted, and the scheme should reopen for regular buying and selling, on or around 17-11-2026. Kotak can shorten or extend the window within SEBI limits, so keep an eye on AMC notices.
3. What does the Kotak Nifty Realty Index Fund invest in?
At least 95% of the money goes into the 10 stocks of the Nifty Realty Index, in the same weights as the index. Up to 5% can sit in debt and money market instruments for cash needs. The companies mainly build residential and commercial property. The fund does not buy foreign shares, InvITs or securitised debt.
4. Which companies are in the Nifty Realty Index?
As on 07-07-2026, the index held DLF, Phoenix Mills, Lodha Developers, Prestige Estates Projects, Godrej Properties, Oberoi Realty, Brigade Enterprises, Anant Raj, Aditya Birla Real Estate and Sobha. DLF had the largest weight at 19.66% and Sobha the smallest at 2.91%. The list can change at each six-monthly review.
5. What is the minimum investment and SIP amount for this NFO?
You need ₹1,000 to invest during the NFO, and any amount above that. After the fund reopens, lump sums and switch-ins also start at ₹1,000, additional purchases start at ₹1,000, and SIPs start at ₹500 with at least two instalments. You can register a SIP during the NFO itself.
6. Is there an exit load on Kotak Nifty Realty Index Fund?
No. The SID sets the exit load at nil, and there is no entry load either. A stamp duty of 0.005% applies on purchases, which slightly reduces the units you receive. When you redeem, securities transaction tax of 0.001% applies on the redemption value. Kotak can change the load structure later, but only for future investments.
7. How is this fund different from the HDFC, Nippon India and Tata Nifty Realty index funds?
All four track the same index, so their portfolios will look almost identical. The differences lie in cost, fund size, tracking quality and exit terms. HDFC’s Direct Plan total expense ratio (TER) is 0.54% and Tata’s Direct base expense ratio is 0.39%, while Kotak’s actual TER will only be known after launch, within its 0.90% base cap. Tata also charges a 0.25% exit load within 15 days; Kotak charges none.
8. What does tracking error mean for this index fund?
Tracking error shows how far the fund’s daily returns drift from the index’s. Expenses, cash held for redemptions and small timing differences when buying or selling shares all create gaps. The SID caps tracking error at 2% a year, measured on one-year rolling data, except in situations beyond the AMC’s control. For an index fund, lower is better.
9. Does the fund invest in REITs or physical property?
It does not own physical property. It buys shares of listed real estate companies. The SID includes REIT units in its list of permitted investments, but the Nifty Realty Index is made up of company shares, and the fund follows the index. If you want REIT exposure, that sits in a different product category.
10. How are gains from the Kotak Nifty Realty Index Fund taxed?
The SID treats it as an equity-oriented fund. Gains on units sold within 12 months are taxed at 20% as short-term capital gains. Units held longer attract long-term capital gains tax at 12.5%, plus surcharge and cess where applicable. IDCW payouts are taxed at your slab rate, with 10% TDS for residents above ₹10,000. Tax rules change, so confirm with a tax adviser.
11. Can I switch from another Kotak fund into this NFO?
Yes. During the NFO, you can switch in from any existing Kotak Mahindra Mutual Fund scheme except ETFs. This includes the growth options of Kotak Liquid Fund and Kotak Overnight Fund. If the NFO is withdrawn or called off, your switch request is not processed and the money stays in the source scheme.
12. When will the NAV be declared, and how fast are redemptions paid?
Kotak will declare the first NAV within 5 working days of allotment, and then every business day on its website and AMFI’s by 11 pm. After the scheme reopens, redemption money is sent within 3 working days of your request, as SEBI rules require. The minimum redemption is ₹500 or your full balance, whichever is lower.
