Bandhan Mutual Fund announced the launch of Bandhan Financial Services Fund this week, aimed at tapping the growth opportunities in the financial services sector.
The open-ended equity scheme will open for subscription today, July 10, 2023.
The fund house said the scheme offers investors the opportunity to benefit from the growth opportunities in the financial services sector for multiple years.
Highlighting the advantages of the fund, Vishal Kapoor, CEO of Bandhan AMC, in a press release, said, “A significant portion of India’s economic growth is fueled by the financial services sector. Powerful enablers, like increasing financial inclusion, growing digitization, and the relatively stronger balance sheet of banks and NBFCs, provide visibility for strong earnings growth for this sector. It has been a key driver of returns for the capital market with the Financial Services Index growing 18X (times) since inception compared to 10X for the Nifty 500 Index.”
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Kapoor said the fund will go beyond the traditional banking sector by diversifying with investments in capital markets, non-banking financial companies (NBFCs), insurance, and fintech to benefit investors from India’s long-term growth story.
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The new fund offer (NFO) will open on July 10, 2023, and close on July 24, 2023. People can invest in the fund through licensed mutual fund distributors and online platforms, including the Bandhan mutual fund portal.
According to the fund house, the Bandhan Financial Services Fund will use a three-factor model for stock selection, prioritizing the stock’s earnings trajectory, management quality, and competitive positioning to focus on the quality and growth aspects of the portfolio.
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In addition, “the fund’s portfolio construction would follow the flexi cap approach from a market cap allocation standpoint and will be actively managed. It will follow a growth style of management and look at medium to long-term growth opportunities,” it said.
Sumit Agrawal, the fund manager for Bandhan Financial Services Fund, adds, “The financial services sector is agile in embracing new businesses and themes that could further enhance its growth prospects. With a whole host of sub-segments and a solid track record for wealth creation over the long term, the valuation of the Nifty Financial Services Index is currently at reasonable levels, a relatively attractive entry point for investors looking to benefit from the growth prospects of this diversified sector.”
Agrawal further said the fund will have a bottom-up stock selection approach with flexible allocation across market cap segments to facilitate the focus on growth-oriented companies with “proven competitive positioning, good management quality, and a robust earnings trajectory.”
