Investment Objective
SBI Automotive Opportunities Fund seeks to generate long-term capital appreciation for investors from a portfolio of equity and equity related instruments of businesses engaged in the automotive and allied business activities sector.
Investment Strategies
- The scheme invests at least 80% of its portfolio in equity and equity related instruments of companies engaged in the automotive & allied business activities sector. (SID)
- The fund can invest its residual net assets, i.e., up to 20% of its portfolio, in businesses other than the automotive & allied business activities theme. (Page 32 presentation)
- The scheme may also exploit investment opportunities in the overseas markets in the automotive theme, especially in R&D, mega trends and also those companies having no presence in the domestic listed market.
- Within the automotive segment, the scheme focuses on Original Equipment Manufacturers (OEM), auto component manufacturers, companies operating in the electric mobility space and companies in the automotive space having export potential.
- The fund may also invest in electronics and semiconductor companies catering to the automobile industry.
- It aims to maintain a market cap agnostic and concentrated portfolio
- The scheme also uses the following parameters for stock selection:- (Page 36 presentation)
- Growth potential of the companies
- Economic growth trend and levels of penetration of the automotive industry
- Capital allocation strategies of the companies and their return profiles
- Ability of the companies to adapt to the evolving auto landscape
- Brand building capabilities of the companies
- Companies’ cash flows and earnings quality
Who Should Invest
- Investors looking for long term capital appreciation by investing in companies operating or tied to the automotive and allied industries.
- Those seeking to invest in a portfolio of well researched stocks of the automotive sector in domestic and overseas markets.
- Investors seeking to benefit from the growth in the automotive industry in domestic as well as overseas markets.
- Individuals having a higher risk appetite and who are also aware of the higher concentration risk associated with the sector/thematic funds