Tag: SBI Mutual Fund

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SBI Mutual Fund to launch SBI ETF Consumption

Jun 30, 2021 by Rekha Nair 0 Comments #Chief Business Officer, #MD & CEO, #Mr. D P Singh, #Mr. Vinay M.Tonse, #SBI Mutual Fund

Mumbai: SBI Mutual Fund today announced the launch of SBI ETF Consumption, an open-ended scheme tracking Nifty India Consumption Index. The new scheme would be suitable for investors who are seeking long term capital appreciation and investment in securities covered by Nifty India Consumption Index. The new fund offer will open on June 30, 2021 and closes on July 14, 2021.

The investment objective of the scheme is to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error.

Mr. Vinay M. Tonse, MD & CEO, said: “We believe passive funds are gaining traction around the world and in India as well where investors would like to invest in line with an index. Investments in ETFs are beneficial for those looking to get exposure to a broad range of asset classes at a lower cost.

With the addition of SBI ETF Consumption, we continue to augment to our portfolio of offerings in the passive investment space, in addition to our actively managed funds. I believe SBI ETF Consumption is a good opportunity as India’s potential for domestic consumption is very large and continues to be a strong growth story.”

Mr. D P Singh, Chief Business Officer, said: “Among the passive investment options, ETFs provide many benefits to investors such as diversification, liquidity, low cost, simplicity and transparency. Consumption has grown consistently over the last few decades and is expected to provide value to investors in the long term as well. We will continue to expand our offerings to help investors achieve their investment goals and provide them access to similar fast-growing themes’’.

Nifty India Consumption Index was launched on January 2, 2006 and comprises of 30 companies. The Nifty India Consumption Index is designed to reflect the behaviour and performance of a diversified portfolio of companies representing the domestic consumption sector which includes sectors like Consumer Non-durables, Healthcare, Auto, Telecom Services, Pharmaceuticals, Hotels, Media & Entertainment. The Nifty India Consumption Index is rebalanced on a semi-annual basis.

The scheme would invest minimum 95% and maximum 100% investment in securities covered by Nifty India Consumption Index with up to 5% in Equity Derivatives & up to 5% in Money Market instruments (including commercial papers, commercial bills, treasury bills, triparty repo, Government securities having an unexpired maturity up to one year, call or notice money, certificate of deposit, usance bills, and any other like instruments as specified by the Reserve Bank of India from time to time) and units of liquid mutual fund.

The minimum application amount (during the NFO period) required is of Rs. 5,000 and in multiples of Re.1 thereafter.

The Fund Manager for SBI ETF Consumption is Mr. Harsh Sethi who also manages SBI ETF IT and SBI ETF Private Bank.

Business World

SBI Mutual Fund is the first mutual fund house to cross Rs. 5 Lakh crore AAUM milestone

Apr 9, 2021 by Neel Achary 0 Comments #SBI Mutual Fund

SBIFMPL, a joint venture between State Bank of India (“SBI”), India’s largest bank, and Amundi, Europe’s largest asset manager and one of the world’s leading asset management companies, has achieved yet another milestone by becoming the first fund house in India to cross Rs. 5 lakh crore of Average Asset Under Management (AAUM).

In the last one year, SBI Funds Management AUM has grown to Rs 5.04 lakh crore from Rs 3.73 lakh crore recording a healthy growth of 35 % in the last FY. The market share of the fund house has also grown from 13.82 % to 15.71 % in the last one year. The fund house has recorded an AAUM growth approx. 37% CAGR from FY15-FY21.

The AAUM growth has been achieved on the back of robust increase in the SIP book and penetration in T30 and B30 locations. The fund house SIP book has increased to Rs 1,382 crore from Rs 1,180 crore over the last one year recording a growth of 17%.

Business World

SBI ETF IT and SBI ETF Private Bank New Fund Offer closes today.

Oct 13, 2020 by Gouri Achary 0 Comments #Mr. Harsh Sethi, #Nifty IT Index, #SBI ETF IT NFO, #SBI ETF Private Bank NFO, #SBI Mutual Fund

SBI Mutual Fund new fund offer for SBI ETF IT and SBI ETF Private Bank are closing today.

SBI ETF IT NFO is suitable for investors who are seeking long term capital appreciation and investment in securities covered by Nifty IT Index. It is an open-ended scheme tracking Nifty IT Index with an objective to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. The benchmark for the scheme is Nifty IT TRI.

SBI ETF Private Bank NFO is suitable for investors who are seeking long term capital appreciation and investment in securities covered by Nifty Private Bank Index. It is open-ended scheme tracking Nifty Private Bank Index with an objective to provide returns that closely correspond to the total returns of the securities as represented by the underlying index, subject to tracking error. The benchmark for the scheme is Nifty Private Bank TRI.

The fund manager for both the scheme is Mr. Harsh Sethi who has over 18 years of industry experience.

Business World

Views on RBI monetary policy – Mr Navneet Munot, CIO, SBI Mutual Fund

Oct 10, 2020 by Gouri Achary 0 Comments #Mr. Navneet Munot, #RBI monetary policy, #SBI Mutual Fund

’The RBI left the rates unchanged and yet delivered an extremely dovish monetary policy by taking measures to keep the risk free rate low and providing on-tap liquidity. Looking through the transient inflationary hump and supporting growth was a clear message sent out in today’s policy. Overall, the forward guidance was extremely favourable as there was an explicit message to keep policy accommodative at least until FY 2022.

The new external MPC members appear to be more dovish in their policy views. In past, they have been quite vocal on liquidity, credit market dynamics, and have advocated for the RBI to look at unconventional or untested measures. The minutes of the meeting, which will be released a fortnight later, will be an important document to watch to gauge their views now (within the mandate of inflation targeting framework).

The RBI finally came out with its expectations on growth for FY21, which is only a tad short of double-digit contraction (-9.5% for FY21).

Ever since the pandemic, RBI had been advocating to do whatever it takes to support the economy and financial sector. Various regulatory relaxations announced since COVID onset had been novel, not tested through time and yet very appropriate and timely. On-tap TLTRO, the introduction of round-the-clock RTGS facility, co-origination of priority sector loans between banks and NBFC/HFCs, and measures to boost export and housing loans announced today are very encouraging.

The RBI has expressed its discomfort on any up-move in yields. Devolvement of primary auctions to PDs on select occasions and cancellation of an OMO is a testament to that. Today, the RBI raised the quantum of OMO purchase, gave explicit guidance for OMO and for the first time, stated plans to conduct OMOs for SDL as well, thereby nudging market from all sides to invest in bonds. We commend RBI’s ‘Open Mouth Operations’ matched with ‘Open Market Operations’. Given the constrained fiscal situation, the government had mostly focused on reforms, while RBI has done the heavy lifting to lend liquidity in the economy.

Over the last few months, the central bank had been juggling through multiple objectives- of keeping the inflation low, managing rupee and bond yields – all of which almost impossible to achieve simultaneously. With inflation shooting past RBI’s comfort zone, it was understandably reluctant to inject more liquidity. On top of that, high Balance of Payments (BoP) situation has already lent considerable rupee liquidity in the system. So the central bank has shied away from an explicit purchase of government papers, which raised the market’s concern amidst increased fiscal deficit. The lack of RBI buying in Q2 led to the 10 years G-sec remaining sticky around 6% since June.

Something eventually had to give- either rupee appreciates or bond yield sell-off or liquidity injected to prevent these outcomes despite high inflation. Eventually, it appears that the central bank had sided with easing the liquidity and nudge yields down.

With India experiencing a large demand shock, and fiscal space not unconstrained, it will be important to ensure the monetary easing achieved thus far is not reversed. To that extent, the explicit OMO guidance is a welcome move. Our view has been that despite the higher G-sec supply this year, a little extra push from the RBI amidst low bank credit and higher private savings will enable the increased government borrowing to go through non-disruptively in this exceptional year. RBI’s buying will catalyze market appetite as well. In particular, banks are flushed with deposits While incremental bank credit FYTD has been a negative of Rs.1.5 trillion. Further, to the extent that the rise in inflation is supply-side driven while demand and employment stay weak and till the extent it does not become more generalised, it should not pose many challenges for RBI. In the long run, supply-side reforms should help lower inflation trajectory.

As such, we continue to remain constructive on duration. On equities, our approach continues to be bottom-up’’.

Business World

Plan to support your child’s aspirations

Sep 14, 2020 by Gouri Achary 0 Comments #Chief Business Officer, #Children’s Funds, #D P Singh, #SBI, #SBI Mutual Fund

As parents, one thing that you would want for your child is for him/her to get the best of everything in life. The environment that kids are exposed to today is drastically different from what you experienced in your childhood. While there are many more opportunities for kids these days, the world is also getting that much more competitive and fiercer, be it in education or sports. That’s why you would want holistic development for your child so that he/she is prepared for every future challenge.

Traditionally, you as a parent would only end up planning for your child’s education. Given the kind of exposure that children get today, they are likely to explore unconventional career paths and aspire to become a coder, a gamer, an artist, an entrepreneur at a young age or make a career in sports. All these unconventional career paths do not yield immediate and regular income and thus need better financial planning at parents’ end.

Today if your child wants to follow his / her passion of becoming a professional athlete or enter the creative field, it will require a significant financial commitment on your end. The cost of the equipment’s and training required for these career paths can be significantly high and is over and above the normal education cost. Moreover, the education landscape has also drastically changed. Today, online learning has become a norm and gadgets such as a laptop, a tablet or smartphone has become a necessity. And this becomes an ongoing expense as technology soon becomes obsolete and needs upgrades. Hence, you as the new age parents need to factor in a lot more than just school and college fees for your child. In order to give wings to your child’s aspirations, financial support is of utmost importance.

But are you prepared for it?

While it’s essential to let your child dream and pursue his/her passion, it is equally crucial for you to have an investment plan. Like for every other goal in your life, preparing an investment plan to meet the financial needs that may arise at different stages of your child’s growth, can help avoid stress in future. For this, it is essential that you start early and invest in appropriate investment avenues that have the potential for long-term wealth creation.

You may have planned for these expenses through traditional investment avenues but at the same time investments in market-linked instruments such as mutual funds are also needed. That’s not it, you should invest in your child’s name so that you don’t end up disturbing these savings in times of need and the money is only utilized for the intended purpose. Premature withdrawals from the fund allocated for your child can disturb the target corpus that you plan to achieve. Children’s Funds offered by mutual funds are one avenue which can be looked at for long term wealth creation. These funds also have a lock-in period, say of 5 years, to discourage early withdrawals and to help you stay committed to the goal.

You should start investing at the earliest and in a systematic manner as it can help you build the required corpus by investing a smaller amount on a regular basis. This is because the longer you stay invested, higher is the compound effect, eventually helping you build a higher corpus. In addition to staying invested for long-term, which can further accelerate the building of your target corpus is SIP Top-up. With the rise in your income levels, the amount that you set aside for your child should also rise.

Children’s Fund offers different plans which cater to different investor risk profiles. The decision to choose from either an equity-oriented fund or debt-oriented fund should be based on your risk profile, investment horizon and the corpus you intend to build. You can invest in these funds until the child turns 18. So, if you are starting early and have a longer investment horizon it is advisable to invest in a fund that has a higher allocation to equities.

Rising inflation can adversely impact your investments plans. Therefore, investment in equities can act as a hedge against rising inflation by generating inflation-adjusted returns. Historically, education cost inflation has been higher than overall inflation. And now with education landscape rapidly changing, education cost is also expected to move up at a much higher pace. Thus, systematic and longer-term investments in equities can help in mitigating the adversities of rising inflation and also help beat short-term market volatility. It can also fulfil your dreams to be able to send your children to the best of schools, colleges, and foreign universities. So, applying what Swami Vivekanand said in the investment parlance “arise, awake and stop not your investments till your financial goal is reached”. The need of the hour is to start investing now!

D P Singh
Chief Business Officer, SBI Mutual Fund

Business World

SBI Mutual Fund to launch SBI Magnum Children’s Benefit Fund – Investment Plan

Sep 7, 2020 by Gouri Achary 0 Comments #Mr. D P Singh, #Mr. Navneet Munot, #Mr. Vinay Tonse, #SBI Magnum Children’s Benefit Fund - Investment Plan, #SBI Mutual Fund

Mumbai, September 7, 2020: SBI Mutual Fund announces the launch of SBI Magnum Children’s Benefit Fund – Investment Plan, an open-ended fund to enable parents to invest for their child’s dreams. The Investment Plan is a new offering as part of SBI Magnum Children’s Benefit Fund which currently has Savings Plan, a predominantly debt-oriented offering.

SBI Magnum Children’s Benefit Fund – Investment Plan will predominantly invest in Equity & Equity related instruments including Equity ETFs with a minimum of 65% going up to 100%, Debt including Debt ETFs and money market instruments up to a maximum of 35% in REITS & InvITs up to 10% and up to 20 % in Gold ETFs.

The new plan would be ideal for a child aged 1 year ideally going up to when he/she is 14 years old, thereby allowing long-term capital appreciation over the long-term. There would be a lock-in period for at least 5 years or till the child attains the age of majority, whichever is earlier. 

Mr. Vinay Tonse, MD & CEO, SBI Mutual Fund said: “Funding education of their children is the top priority for any parent. Given the dual challenges of rising cost of education and interest rates coming down significantly, there is a need to look beyond traditional investment options. SBI Magnum Children’s Benefit Fund – Investment Plan is an ideal fit given its construct of being well-diversified across asset-classes, be it equity, debt or gold.”

“Equity asset class as a long-term wealth-creator will help parents in having the right financial support to take care of their child’s future and the sooner they start the better it is,” Mr Tonse added.

Mr. Navneet Munot, Chief Investment Officer, SBI Mutual Fund said, “Our strategy would be to create a fund portfolio with a combination of high conviction ideas with a long-term orientation within a robust risk management framework. Equity portion would be market capitalisation agnostic, while Debt portion would be invested in high credit quality portfolio with a short-to-medium duration profile.”

Mr. D P Singh, Chief Business Officer, SBI Mutual Fund said: “The aspirations of children today are very different and have been shaped by the strong influence of the evolving media & technology around us. Parents must have a strong financial plan to be prepared for these aspirations. I believe, children-oriented mutual funds are a compelling solution for parents to save for their children’s future as it helps create a separate ‘bucket’ in which they invest only for their child. Such a segregation in their investment can alert them to not dip into and withdraw from this corpus for an impulsive or short-term need. The fund is an ideal fit given its construct of being well-diversified across asset-classes, be it equity, debt or gold.”

‘’The SIP route works well for all long-term goals and in this fund particularly for young parents who can start planning early for their child’s dreams. Starting a SIP and regularly doing a top-up of their SIP amount every year can make funding for their children’s education easier.” Mr. Singh added. 

The NFO period of SBI Magnum Children’s Benefit Fund – Investment Plan opens on Tuesday, 8th September 2020 and will close on Tuesday, 22nd September 2020. The fund managers of the Investment Plan will be Mr. R. Srinivasan for Equity Portion and Mr. Dinesh Ahuja for Debt Portion.