Thematic NFOs: BoI debuts BFSI fund, Mahindra Manulife unveils Innovation Opportunities Fund

As India’s equity markets head into 2026 with a focus on long-term structural growth themes, two fund houses, Bank of India Mutual Fund and Mahindra Manulife Mutual Fund, have announced the launch of new open-ended equity schemes aimed at tapping into distinct engines of economic expansion: financial services and innovation.

Bank of India Mutual Fund has unveiled the Bank of India Banking & Financial Services Fund, an equity scheme designed to generate long-term capital appreciation by investing primarily in companies across the banking and financial services space. The new fund offer (NFO) will open on January 8, 2026, and close on January 22, 2026.

The timing of the launch reflects the growing importance of the BFSI sector in India’s growth story. Expanding credit penetration, rapid digitisation, rising financial inclusion and the formalisation of economic activity have turned financial services into a central pillar of the economy. Over the past two decades, the Nifty Financial Services TRI Index has delivered nearly 28-fold returns, comfortably outperforming broader market benchmarks and highlighting the sector’s long-term wealth creation potential.

While banks continue to dominate market capitalisation within BFSI, the ecosystem has widened significantly. Fast-growing segments such as non-banking financial companies (NBFCs), insurance, capital markets and fintech are emerging as powerful growth drivers. Their deep linkage with GDP growth, digital adoption and inclusion initiatives reinforces BFSI’s role as the backbone of India’s economic expansion.

The new fund will adopt a diversified, market-cap-agnostic approach, investing across banks, NBFCs, fintech firms, insurers and capital market players. It will be benchmarked to the Nifty Financial Services TRI and managed by Nilesh Jethani, Fund Manager at Bank of India Investment Managers.

Mohit Bhatia, CEO of BOIIM, said the scheme offers investors a structured way to participate in India’s deepening financial ecosystem, adding that strong governance standards, capital efficiency and consistent growth make BFSI a compelling long-term theme. CIO Alok Singh noted that the fund will follow a blended top-down and bottom-up strategy, focusing on innovators, compounders and high-growth companies across market segments.

The minimum investment is Rs 5,000, with additional investments in multiples of Rs 1. An exit load of 1% applies to redemptions within 60 days.

Mahindra Manulife Innovation Opportunities Fund

Meanwhile, Mahindra Manulife Mutual Fund has announced the launch of the Mahindra Manulife Innovation Opportunities Fund, an open-ended equity scheme designed to capture long-term growth driven by radical and disruptive innovation. The NFO will open on January 9, 2026, and close on January 23, 2026, with the scheme reopening for continuous transactions from February 2, 2026.

The fund aims to invest predominantly in companies leveraging innovation to reshape industries through breakthrough products, new processes and transformative service models. Its investment universe spans businesses driving change across technology, healthcare, manufacturing, financial services, digital platforms and clean energy.

Under its asset allocation strategy, the scheme will invest 80–100% of assets in equity and equity-related instruments aligned with the innovation theme, with flexibility to use equity derivatives up to half of the equity exposure. Up to 20% may be invested in companies outside the theme, while overseas securities, REITs, InvITs, and debt instruments add diversification.

Anthony Heredia, MD & CEO of Mahindra Manulife Investment Management, said innovation remains one of the strongest long-term drivers of sustainable change. The fund will be managed by Kirti Dalvi and Renjith Sivaram Radhakrishnan, bringing together decades of experience in equity research and sector-focused fund management. CIO–Equity Krishna Sanghavi added that innovation is fast becoming the core engine of competitive advantage, positioning the fund to capture India’s next phase of growth.