NFO alert: Sundaram Services Fund NFO papers filed with SEBISundaram Mutual Fund has filed papers with market regulator SEBI for the launch of Sundaram Services Fund, a thematic fund centered around the services sector.

The scheme will invest in businesses which derive a majority of their income from the services sector of the economy. Services accounted for 53.8% of India’s GDP in 2016, far more than both agriculture and industry. According to the Scheme Offer Document, the services sector includes healthcare, tourism and hospitality, transportation and logistics, education, staffing and so on.

The scheme will be required to invest 80-100% of its assets in equity and the balance 0-20% in debt or money market instruments. The NFO will be open for a period of 15 days after launch.

The S&P BSE 200 (Total Return Index) will be the benchmark of the scheme. Total Return Index means that dividends are assumed to be reinvested in the index. The selection of a generic benchmark rather than a thematic one such as the Nifty Services Sector Index is a matter of concern. The benchmark selected may not be a good yardstick against which to compare the scheme.

The scheme will have no less than four managers. They are S Krishnakumar, Rahul Baijal, Rohit Seksaria and Dwijendra Srivastava. Dwijendra Srivastava will manage the fixed income component of the scheme.

Key Details:

Benchmark: S&P BSE 200

Fund Managers: S Krishnakumar, Rahul Baijal, Rohit Seksaria and Dwijendra Srivastava

Options: Growth, Dividend Payout, Dividend Reinvestment and Dividend Sweep

Minimum Investment: Rs 5,000

Author
Neil Borate

Neil Borate is Deputy Editor, RupeeIQ. He can be contacted at neil@rupeeiq.com.