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SBI Mutual Fund started a new fund called SBI Energy Opportunities Fund. People can invest in this fund from February 06, 2024 to February 20, 2024. After that, the fund will be available for buying and selling again within five days of giving the units.
SBI Mutual Fund described its objectives in the fund, saying, "Our investment objective for the scheme includes providing investors with opportunities for long-term capital appreciation by investing in equity and equity-related instruments of companies. These companies engage in activities such as exploration, production, distribution, transportation, and processing of traditional & new energy including but not limited to sectors such as oil & gas, utilities, and power. However, we cannot assure that the investment objective of the Scheme will be realized."
What is SBI's Energy opportunities fund?
The SBI’s Energy Opportunities Fund, a new entity, invests in companies that participate in energy-related activities. This participation spans both traditional and new energy sectors like oil and gas, utilities, and power. By capitalizing on the growth in these sectors, the fund strives to deliver long-term capital growth.
The fund is open for subscription from February 6, 2024 to February 20, 2024. Raj Gandhi and Pradeep Kesavan manage the fund, which is benchmarked to the Nifty Energy TRI Index. The minimum investment in the fund is ₹5,000.
How to apply for SBI's Energy Opportunities fund
- Visit the website of SBI Mutual Fund or any online platform that offers the fund.
- Choose the plan (regular or direct), option (growth or IDCW), and mode (lump sum or SIP) that suits your needs.
- Fill in your personal and bank details.
- Pay the amount you want to invest using the available modes.
- Confirm your transaction and get the acknowledgement.
- Wait for the allotment of units after the NFO closes.
SBI Energy Opportunities Fund: Fund Facts
| Fund name | SBI Energy Opportunities Fund |
|---|---|
| SEBI category | Sectoral/Thematic |
| NFO period | February 6, 2024 to February 20, 2024 |
| Investment objective | The fund will look to benefit from the growth in traditional and new energy sectors and allied business activities. |
| Benchmark | Nifty Energy TRI |
| Fund managers | Raj Gandhi and Pradeep Kesavan (Overseas securities) |
| Exit load | 1 per cent (of applicable NAV) if units are redeemed or switched-out wiithin 1 year from the date of allotment. Nil thereafter. |
| Tax treatment | Same as any other equity fund. If units are sold after one year: Gains beyond Rs 1 lakh are taxed at 10 per cent. (However gains up to 1 lakh in a financial year is tax exempt). If units are sold within one year: 15 per cent. |
What is the main objective of investing in this fund?
The SBI Energy Opportunities Fund is a new fund that invests in companies that are involved in energy-related activities. These include both traditional and new energy sectors, such as oil and gas, utilities, and power. The fund aims to provide long-term capital growth by benefiting from the growth in these sectors.
This fund is different from other funds because it focuses only on the energy sector. There are two other funds that also invest in energy, but they also invest in other things like cement and chemicals. The SBI Energy Opportunities Fund will compare its performance with the Nifty Energy TRI Index. This index shows how well the energy sector is doing. It has given good returns in the last year.
The fund will not only invest in the companies that are in the index, but also in other companies that are related to energy. These include companies that make or use things like power equipment, green energy, oil and gas products, and power services.
The fund will have a lot of options to choose from. There will be around 90-95 stocks that the fund can invest in.
The fund will not invest in too many stocks. It will only invest in around 20-25 stocks that it thinks are the best.
The fund will also invest in some foreign companies that are in the energy sector. The fund can invest up to 35 per cent of its money in these companies.
Returns of Nifty Energy TRI (in %)
| Mutual Fund House | Name of the fund | 5-year returns (in %) |
| DSP Mutual Fund | DSP Natural Resources and New Energy Fund | 23.33 |
| Tata Mutual Fund | Tata Resources & Energy Fund | 26.21 |
| Source: AMFI (As of February 06, 2024) | ||
DP Singh, a top leader of SBI Funds Management, said that the energy sector has improved a lot because of better facilities and rules. This has made the sector more profitable. The fund house has chosen 95 stocks that can invest in and will have 20-25 stocks that it believes will grow fast.
He also said that energy use in a country is related to how much the country grows. India is expected to be one of the biggest economies in the world, so its energy use per person could also go up a lot. There are chances to make money in different parts of the energy business, he said.
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