SBI Mutual Fund has announced the launch of SBI Automotive Opportunities Fund. The open-ended equity scheme will follow the automotive and allied business activities theme.
The new fund offer (NFO) will open for subscription on May 17, 2024 and close on May 31. The fund would be benchmarked to the Nifty Auto TRI index.
Investment Allocation
The fund would invest predominantly (80-100 per cent) in equity and equity-related instruments of companies engaged in automotive and allied business activities theme (including equity derivatives). The balance, if any (0 – 20 per cent) would be invested in equity and equity-related instruments of other companies or in debt and debt-related and money market instruments.
The scheme might also invest up to 10 per cent of its assets in units issued by real estate investment trusts (REITs) and infrastructure investment trusts (InvITs), according to SBI Mutual Fund.
Foreign Exposure
The fund might also take exposure in foreign securities, including foreign equity and debt securities, and overseas exchange-traded funds (ETFs). However, such investment will not exceed 35 per cent of the net assets of the scheme and will be in line with the maximum limits available from time to time.
Objective
The investment objective would be to generate long-term capital appreciation for investors by investing in equity and equity related instruments of companies engaged in automotive and allied business activities theme from the domestic as well as global universe.
Shamsher Singh, managing director and chief executive Officer, SBI Funds Management said in a statement, “India is the world’s third largest automobile market and the Indian Automotive sector presents an attractive opportunity, both due to domestic demand and auto exports.”
He added: “The SBI Automotive Opportunities Fund is a wonderful opportunity for investors who would like to benefit from the growth of the entire automotive ecosystem as this sector is poised to take India to new places.”
D P Singh, deputy managing director and joint CEO, SBI Funds Management, added: “I am pleased to present the SBI Automotive Opportunities Fund to investors who are keen to add a thematic offering to the satellite portion of their portfolios. In addition to the growth in production and exports, the manufacturing of auto parts and ancillaries also contribute to almost 30 per cent of the manufacturing ecosystem, thus providing wealth creation opportunities for investors in the long-term.”e, SBI Mutual Fund said in a statement.
