The new fund offer (NFO) is open, and it will close for subscription on March 6. The first-tier benchmark of the fund is the NIFTY 500 TRI.
The investment objective of the scheme is to provide investors with opportunities for capital appreciation and/or dividend distribution by investing predominantly in a well-diversified portfolio of equity and equity related instruments of dividend yielding companies, the press release said. This is proposed to be achieved by investing in businesses across market capitalisation, be style agnostic with no sector bias, with attractive dividend yields plus potential growth in dividends, and aim to achieve an aggregate dividend yield that is at least 50% higher than that of the Nifty 50 Index. The scheme will consider dividend-paying stocks that have paid dividends or repurchased shares in at least one of the previous three fiscal years, the fund house added.
Shamsher Singh, MD & CEO, SBI Mutual Fund, said, “I am happy to announce the launch of SBI Dividend Yield Fund, an offering which provides investors a diversified mix of high and growing dividend yield companies. As the largest fund house in the country, we continue to add to our bouquet of offerings, and we believe this category has an opportunity to grow and find merit in investors’ portfolios.”
D P Singh, Deputy MD and Chief Business Officer, SBI Mutual Fund, said, “High Dividend Yield companies are generally thought of only from the angle of providing regular income, but many of them are strong growth-oriented businesses across market cap with the potential of long-term wealth creation. SBI Dividend Yield Fund presents an opportunity for those looking to invest in such strong businesses with steady cash flows for long-term. Those who invest in direct equity, investors wanting long term wealth creation and even first-time mutual fund investors will find this fund suitable. Investors who want regular income, can use the SWP (A) facility offered in this fund to plan regular tax efficient cash flows’’.
The minimum application amount is Rs 5,000 and in multiples of Re 1 thereafter. The scheme would invest between 65% – 100% of its assets in equity and equity-related instruments of dividend-yielding companies (including equity derivatives), up to 35% in other equity and equity-related instruments, up to 35% in debt securities (including securitised debt and debt derivatives) and up to 10% in units issued by REITs and InvITs. The scheme may seek investment opportunities in foreign securities including ADR/GDR/Foreign equity and overseas ETFs and debt securities subject to regulations which may not exceed 35% of the net assets of the scheme.
Rohit Shimpi, CFA, will be the fund manager of this scheme with Mohit Jain the dedicated fund manager for overseas securities. Rohit currently manages SBI Magnum Equity ESG Fund and the equity portion of SBI Retirement Benefit Fund.
