Aditya Birla Sun Life Mutual Fund launches Aditya Birla Sun Life PSU Equity Fund: Aditya Birla Sun Life AMC Limited, a subsidiary of Aditya Birla Capital Limited (a significant non-bank financial services’ conglomerate), and investment manager to Aditya Birla Sun Life Mutual Fund (ABSLMF) announced the launch of Aditya Birla Sun Life PSU Equity Fund, an open-ended equity scheme following PSU theme.
This fund focuses on investing predominantly in Public Sector Undertakings (PSUs) or companies where the government (State or Central) is a majority shareholder with at least 51% shareholding. The fund is diversified in nature and focuses on long term growth and appreciation of capital.
Commenting on the launch, A. Balasubramanian, MD & CEO, Aditya Birla Sun Life AMC Limited said: “PSUs typically dominate sectors that are core to the economy and its growth such as Utilities, Oil & Gas, Metals & Mining, Infrastructure, Defence, Engineering, Banking etc. Often, they have a monopolistic position or large scale, with strong Return on Equity (RoE) and steady cash flow from operations which allow them to give out high dividends. Many of these have characteristics of bluechips in their respective industries”.
As India guns for its economic growth and infrastructure targets, PSUs which dominate many key sectors of the economy would also grow, especially in industries where setting up a new business unit requires huge capital, regulatory clearances and/or expertise. Government policies, reform plans and economic growth agenda will trigger the comeback for many of these companies going forward.
“Most PSUs are quality companies with strong balance sheets and a potential to get re-rated over a period of time. The Government’s increasing focus on strategic divestment plans will also help unlock value for some of the PSUs. This combined with the attractive valuations and their underlying intrinsic value make them a compelling investment choice”, added Mr. Balasubramanian.
The minimum application amount for this fund is Rs.500/- and in multiples of Re. 1/- thereafter, during the New Fund Offer period.
