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Business News/ Mutual Funds / NFO Alert: Baroda BNP Paribas Mutual Fund launches Baroda BNP Paribas Innovation Fund; all you need to know
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NFO Alert: Baroda BNP Paribas Mutual Fund launches Baroda BNP Paribas Innovation Fund; all you need to know

Baroda BNP Paribas Mutual Fund announced the launch of the Baroda BNP Paribas Innovation Fund. The scheme opened for public subscription on February 14, 2024, and will close on February 28, 2024.

Baroda BNP Paribas Mutual Fund announced the launch of the Baroda BNP Paribas Innovation Fund as a part of its new fund offers.Premium
Baroda BNP Paribas Mutual Fund announced the launch of the Baroda BNP Paribas Innovation Fund as a part of its new fund offers.

Baroda BNP Paribas Mutual Fund announced the launch of the Baroda BNP Paribas Innovation Fund. The scheme opened for public subscription on February 14, 2024, and will close on February 28, 2024. The scheme re-opens for continuous sale and repurchase within five days from the date of allotment.

What kind of mutual fund scheme is this?

This is an open-ended equity scheme investing in innovation theme. Innovation extends beyond the realm of technology, encompassing various fields. The innovation landscape in India is flourishing, driven by increasing per capita GDP, shifting consumer behaviours, a growing youth demographic, changing consumer preferences, and robust government initiatives. Key drivers of this momentum include the adoption of cleaner technology, widespread internet accessibility, and the prevalence of smartphone usage. India's prowess in innovation is evident not only in the technological sphere but also in diverse sectors like manufacturing and space exploration, as demonstrated by successful ventures such as Chandrayaan and Vande Bharat.

What is the main objective of investing in this fund?

The investment objective of the scheme is to seek long-term capital appreciation by investing at least 80% of its net assets in equity/equity-related instruments of companies focusing on and benefitting from innovation. However, there is no assurance or guarantee that the investment objective of the scheme will be achieved.

Commenting on the NFO launch, Suresh Soni CEO, Baroda BNP Paribas AMC, said, “Innovation is the spark that inspires change. The Baroda BNP Paribas Innovation Fund aims to back the disrupters and the brave creators building revolutionary paths with cutting-edge technologies. The fund will pick companies that are poised to transform industries and capitalise on shifting market trends. By supporting a diverse mix of legacy enterprises, digital natives, and transformers, the fund will strategically invest in firms that thrive on innovation across several sectors and market caps."

How may one invest in this scheme?

Investors can invest under the scheme with a minimum investment of 5000 per plan/option and in multiples of Re 1. There is no upper limit for investment.

Under normal circumstances, the asset allocation (% of net assets) of the scheme’s portfolio will be as follows:

Instruments

Indicative allocations (% of total assets)

Risk Profile

Minimum

Maximum

Equity & Equity related instruments of companies belonging to the innovation theme

80%

100%

High

Equity and equity-related instruments of any other companies

0%

20%

High

Debt & Money Market instruments

0%

20%

Low to Medium

Units issued by REITs & INvITs

0%

10%

Medium to High

Units of Mutual Fund Scheme

0%

10%

Medium to High

Are there similar mutual funds in the market?

To date, two asset management companies (AMCs) have launched such funds in the past. The following table illustrates the names of the mutual fund houses along with their respective innovation funds.

Name of the mutual fund house

Name of the fund

ICICI Prudential Mutual Fund

ICICI Prudential Innovation Fund

Nippon India Mutual Fund

Nippon India Innovation Fund

Union Mutual Fund

Union Innovation & Opportunities Fund

Source: AMFI (As of February 15, 2024)

How will the scheme benchmark its performance?

The performance of the scheme will be benchmarked to the performance of Nifty 500 TRI. The Trustee / AMC reserves the right to change the benchmark for evaluation of the performance of the scheme from time to time in conformity with the investment objectives and appropriateness of the Benchmark subject to the SEBI Regulations, and other prevailing guidelines, if any.

Are there any entry or exit loads to this scheme?

This scheme involves no “Entry Load", which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load" would be calculated as under:

- If units of the scheme are redeemed or switched out up to 10% of the units (the limit) within 1 year from the date of allotment - Nil.

- If units of the scheme are redeemed or switched out more than the limit within 1 year from the date of allotment - 1% of the applicable NAV.

- If units of the scheme are redeemed or switched out after 1 year from the date of allotment - Nil.

Who will manage this scheme?

Pratish Krishnan shall be the designated fund manager for the scheme.

Does the fund contain any inherent risk?

The scheme involves “Very High Risk" as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.

 

 

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Published: 16 Feb 2024, 09:53 AM IST
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