Baroda BNP Paribas AMC debuts India?s First Gift City Fund investing in US Small Caps
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Leading asset management firm Baroda BNP Paribas Asset Management India Pvt. Ltd. (BBNPP AMC) has introduced India’s first-ever fund providing direct exposure to the US small-cap market through its GIFT City branch—the Baroda BNP Paribas GIFT US Small Cap Fund.
This launch also marks the first GIFT City-based fund focused on US small-cap stocks, offering Indian investors a regulated, dollar-denominated route to participate in US equity markets while utilizing RBI’s Liberalised Remittance Scheme (LRS) limits under the Overseas Portfolio Investment route.
“As a GIFT City-registered Restricted Scheme, the Baroda BNP Paribas GIFT US Small Cap Fund presents an efficient investment avenue for diversifying into US small caps. We believe this asset class is well-positioned to benefit from multiple tailwinds in 2025,” stated Mr. Sanjay Grover, Managing Director & CEO of Baroda BNP Paribas AMC.
A New Opportunity for Indian Investors
Previously, Indian investors faced constraints due to SEBI’s $7 billion overseas investment cap on mutual funds. The Baroda BNP Paribas GIFT US Small Cap Fund, structured as an IFSCA-regulated Restricted Scheme, circumvents this limitation, reopening global access for individuals, Family Offices, HNIs, and UHNIs.
The fund will invest in the BNP Paribas US Small Cap Fund, a 3-star Morningstar-rated scheme that has outperformed the Russell 2000 Index in 10 of the last 12 years, demonstrating consistent alpha generation. (Source: Morningstar as of September 30, 2025)
The underlying $1.4 billion BNP Paribas US Small Cap Fund has delivered a 3-year USD CAGR of 14.27% (Source: BNP Paribas AM) and is managed by an experienced US-based team led by Geoff Dailey. The team, with an average 20+ years of experience, maintains a diversified portfolio of small-cap stocks across sectors.
“The US equity market remains resilient amid global volatility, with small caps offering compelling opportunities beyond mega-cap dominance. Potential Fed policy shifts, attractive valuations, and domestic economic exposure make this segment appealing,” said Geoff Dailey, Lead Portfolio Manager of the BNP Paribas US Small Cap Fund.
“For investors diversifying beyond big tech, small caps provide broader exposure to the US economy—tapping into an under-researched growth engine,” Geoff added.
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