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SBI Infrastructure Fund

Nature of fund:

Open-ended Growth scheme.

Investment objective:

The SBI Infrastructure Fund aims to provide investors with the opportunity for long term capital growth. It aims to do so by actively managing investments in a diversified pool of equity stocks of companies that are directly or indirectly involved in infrastructural growth in the Indian economy. The fund will also invest in debt and money market instruments.

Fund information:

Inception date 6th July, 2007
CRISIL rank (as in June, 2015)

CRISIL Rank 5 in the Thematic - Infrastructure funds category.

CRISIL Rank 5 in the Consistent Performers – Equity funds category.

Plans

•Regular.

•Direct.

Options

•Growth.

•Dividend.

Schemes

•SBI Infrastructure Regular Growth Fund.

•SBI Infrastructure Regular Dividend Fund.

•SBI Infrastructure Direct Growth Fund.

•SBI Infrastructure Direct Dividend Fund.

Entry load None.
Exit load

•For exit within 1 year from the date of allotment = 1.00%.

•For exit after 1 year from the date of allotment = 0.

Minimum investment

•Rs.5,000 (in multiples of Re.1).

•Additional Investment: Rs.1,000 (in multiples of Re.1).

SIP Monthly

•Minimum Rs.1000 (in multiples of Re.1) thereafter for minimum six months.

•Minimum Rs.500 (in multiples of Re.1) thereafter for minimum one year.

Quarterly

•Minimum Rs.1500 (in multiples of Re.1), thereafter for minimum one year.

Product label – Risk and target investors High Risk. Target investors are those who seek:

•Long term growth in investments.

•Investments predominantly in equity stocks companies that directly or indirectly contribute to the development of Indian economy’s infrastructure.

Benchmark CNX Infrastructure Index
SWP Yes.

•Only available at applicable load, if any.

STP Yes
Redemption

•Rs.1,000 or 100 units or account balance (whichever is lower).

•The price will be the Applicable NAV minus Exit Load.

•Redemption proceeds will be dispatched within 10 working days.

Taxation (on investment and on redemption) The tax implications of being associated and invested in this mutual fund must be discussed at length with your tax advisor.

Fund manager

Mr. Richard D’Souza

Mr. Richard D’Souza had graduated from the University of Mumbai as a Bachelor of Sciences (Physics). He has been with SBI Mutual Funds since 2010 as the Fund Manager for the Retail PMS division. In addition to the SBI Infrastructure fund, he also manages the SBI Magnum Multicap fund, the SBI Magnum COMMA Fund and the SBI PSU Fund. With over 20 years of hands on experience as a research analyst and portfolio manager, Mr. Richard D’Souza has brought a wealth of knowledge and experience over from the companies he’s worked at, such as ASK Investment Managers, Antique Share and Stock Brokers, Sunidhi Consultancy and Alchemy Share & Stock Brokers.

Investment philosophy

  • Exposure to derivative instruments is up to 50% of the equity portfolio.
  • Invests predominantly in the equities of companies developing the Indian economic infrastructure – directly or indirectly.
  • Also will invest in debt and money market instruments.

Portfolio – Top 10 Holdings As on July 31st, 2015:

Equity Sector Percentage of AUM
Bharti Airtel Telecommunications 8.30
Larsen Engineering 7.00
ITD Cementation Cement 5.50
Power Grid Corp Utilities 4.72
Sagar Cement Cement 4.54
Techno Electric Engineering 4.42
Cholamandalam Banking / Finance 4.36
Sadbhav Engineering Engineering 3.81
Kennametal Engineering 3.79
Shanthi Gears Engineering 3.71

Risk measures:

Sharpe Ratio 0.35
Alpha N/A
Beta 0.85
Standard deviation 23.31%

Performance

AUM (as on 30th June, 2015) Rs.554.88 crores.
NAV (as on 2nd September, 2015)

•SBI Infrastructure Regular Growth Fund = 10.8106.

•SBI Infrastructure Regular Dividend Fund = 10.8115.

•SBI Infrastructure Direct Growth Fund = 10.9620.

•SBI Infrastructure Direct Dividend Fund = 10.9520.

Returns and benchmark comparison
Date Scheme returns CNX Infrastructure Index
Since Inception (till 31st May, 2015) 1.70 -2.35
5 year 3.17 -0.06
3 year 17.90 13.81
1 year 19.00 1.86
Expenses
Slab Rates SBI Infrastructure Fund expenses as a % of daily net assets
First 100 crores 2.50%
Next 300 crores 2.25%
Next 300 crores 2.00%
Balance Assets 1.75%

Expert view of the fund

Infrastructure hasn’t been an attractive investment sector since 2008, and still isn’t as evidenced by the performance of this fund. It’s been consistently lower than the category average and the benchmark. This fund has been unstable, and infrastructure funds must be carefully chosen. Even though this fund primarily invests up to 69% of its portfolio in large-cap companies which are generally more stable and profitable, the fund does not generate quick returns. It’s highly suitable for creating wealth and meeting lifestyle needs but not so much for things like funding your child’s education or marriage. Don’t invest in this fund until it starts doing better. Whether you’re a first time investor or a seasoned veteran, investments in this fund will not yield returns as high as some other funds across categories. With 17.30% exposure to mid-cap companies and 12.82% exposure to small cap companies, the fund exposes itself to the fluctuations of small and midcap companies.

How to apply

You can apply online through the SBI mutual funds website, or alternatively call the SBI mutual funds office and they will guide you through a step-by-step procedure on how to invest. At any stage during your research on the SBI website, scroll to the top right of the screen and you will find a button that you can click on to express your interest in investing in the fund. You can physically walk in to the SBI branch and fill up your KYC forms after which you will be directed on how to invest through the mutual funds investment desk at the branch. There’s a 24/7 dedicated toll free number you can call, and you can also send an SMS showing your intent to invest. All these details of the number to call or SMS can be found on the SBI mutual funds website. You can also contact any one of SBI’s Investor Service Centres.

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Display of any trademarks, tradenames, logos and other subject matters of intellectual property belong to their respective intellectual property owners. Display of such IP along with the related product information does not imply BankBazaar's partnership with the owner of the Intellectual Property or issuer/manufacturer of such products.

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