SBI Mutual Fund looks to garner up to Rs 4,000 cr from energy-focused NFO

The largest fund house SBI Mutual Fund on Monday said it is looking to garner Rs 3,500-4,000 crore of primary subscription from the new fund launch. SBI energy opportunities fund which is an open-ended scheme following the energy theme, will invest in an optimal mix of domestic and overseas companies engaging in activities such as exploration, production, distribution, transportation and processing of traditional and new energy including but not limited to sectors such as oil & gas, utilities and power.

The new fund offer opens on February 6 and closes on the 20th, Shamsher Singh, managing director & chief executive said.

On the fundraising target during the NFO period, D P Singh, the deputy managing director & joint chief executive, told PTI that more than the primary subscription they are more interested in wider coverage and the aim it cover/get subscriptions from at least 90 per cent of the pin codes and from at least 2.5-3 lakh investors.

“From the fund mop-up perspective, we are targeting Rs 3,500-4,000 crore,” he added.
The energy sector is a multi-decade story as the country aims to move from being energy-deficient to self-sufficient. The commitments towards green energy initiatives like COP26, Green Hydrogen Mission, the ethanol blending programme along with focused policy initiatives in the traditional energy sectors provide sufficient tailwinds for the energy sector to grow in line with needs. The fund offers an opportunity to participate in the growth story of the domestic energy sector which has seen rapid strides in terms of infrastructure and policy reforms, helping improve the profitability of the sector, Singh added. The scheme will primarily invest 80 to 100 per cent of its assets in equity and equity-related instruments of companies engaged in energy (traditional & new) and allied business activities.

The balance will be parked in other equity and equity-related instruments including equity derivatives, debt securities securitised debt and debt derivatives and money market instruments.