Sundaram BNP Paribas Select Thematic Financial Services Opportunities
Scheme type: Open-ended diversified equity
Minimum investment: Rs 5,000; unit price: Rs 10
Loads: Entry load: 2.25%. Exit load: 1% (if less than six months)
Options: Growth and dividend (payout and reinvestment)
Investor grievances: S Balasubramanian. Tel: (044) 28578700. Email : service@sundarambnpparibas.in
Objective: To seek capital appreciation by investing predominantly in equity and equity related securities of banking and financial services companies in India.
Benchmark: CNX Bank Index
Fund manager: J Venkatesan (Indian investments) and R Vijayendiran (overseas investment)
Asset allocation:
65-100% Equity and equity related in the targeted theme
0-35% Equity and equity related other than the targeted theme
0-15% Debt and cash
Comparable existing scheme:
Fund Name: JM Financial Services Sector
NAV* (Rs): 14.82
6-month return(%): -9.91
1-year return(%): 45.85
*NAV as on 7 May. Source: NAVIndia
Idea distiller: Rising incomes, a growing working class and greater willingness to take loans are some factors propelling the growth of the Indian financial services sector. The fund attempts to benefit from this trend.
Fund house report: BNP Sundaram Paribas AMC is among the top 10 fund houses and manages assets worth Rs 13,619 crore (as on 30 April).
Returns profile: 5/5
Risk profile: 5/5
Fund managers report:
Performance of fund managers
Returns profile: 5/5
Risk profile: 1/5
Scheme DNA:
Unique idea: Medium
Return possibility: High
Risk: Medium
Operability/Complexity: Medium
Who should apply:
Not for the first-time equity fund investor; this fund will suit experienced investors. If you already have a few sector funds, exit one to invest in this. Your investment horizon should be medium to long term; don’t put more than 5% of your portfolio in this fund.
Remember:
Though there are good stocks in this sector, it is prone to volatility. The banking sector is underpriced; areas of concern are low treasury returns, NPA levels and global cues. The positives are the undervaluation and growth in business of firms other than banks.
