SBI Mutual Fund’s (SBI MF) new fund offer (NFO) of its multicap fund, which was open between February 14 and February 28, has collected over Rs 7,500 crore of investor flows, according to sources. The official figures are yet to be released.
The collection figures indicate that large mutual fund houses, especially those with access to wide branch and distribution networks, are likely to continue their run of record NFO collections in the new year, which started from previous year.
SBI MF, which is the country’s largest asset manager, has access to State Bank of India’s (SBI) wide bank branch network.
SBI MF’s NFO of its Balanced Advantage Fund had collected Rs 14,551 crore, followed by ICICI Flexicap Fund that collected Rs 9,808 crore in its NFO.
Also read: Five mutual funds that had record collections during their NFOs in 2021
A different take on multicap funds
SBI MF will be running the SBI Multicap Fund in a slightly different way than how it is run in the mutual fund industry.
The fund will be run like a focused fund with high-conviction investment ideas being backed by sizeable allocation in the fund.
The fund’s portfolio will be created from the high-conviction ideas of its team of 15 sector analysts.
The fund manager R Srinivasan, who is head-equity at SBI MF, will pick from these high-conviction ideas and account for factors such as liquidity of the stock, existing stock ownership and decide whether a meaningful allocation can be made to the stock.
SEBI rules state that a multi-cap fund needs to invest a minimum 25 percent each in small-cap, mid-cap and large-cap stocks. However, SBI Multicap Fund would be investing 27 percent each in each of these market caps. The remaining will be at fund manager’s discretion.
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