Motilal Oswal Mutual Fund has filed draft documents for the launch of a new sectoral equity scheme, to be known as the Motilal Oswal Financial Services Fund. The proposed scheme will be introduced as an open-ended fund and offered at a face value of ₹10 per unit during its New Fund Offer (NFO). The dates for the NFO have not yet been announced.
Scheme Category and Investment Objective
The fund is classified as a sectoral equity scheme with a focus on financial services. Its objective is to generate long-term capital appreciation by investing primarily in equity and equity-related instruments of companies that derive a substantial portion of their revenues from financial services activities.
Proposed Asset Allocation
As outlined in the draft Scheme Information Document, the fund will allocate between 80% and 100% of its assets to equity and equity-related instruments of companies operating in the financial services sector. The remaining portion, up to 20%, may be invested in equities outside the sector, debt instruments and money market securities.
Investments in real estate investment trusts (REITs) and infrastructure investment trusts (InvITs) will be capped at 10% of net assets, while exposure to units of other mutual fund schemes will be limited to 5%.
Investment Universe
The scheme’s investment universe includes listed companies across a wide range of financial services segments, such as banking, non-banking financial companies, insurance, housing finance, asset management, stock broking, stock exchanges, fintech platforms and other financial intermediaries. The fund may also invest a limited portion of its assets in overseas securities, subject to regulatory limits prescribed by SEBI.
Benchmark and Liquidity Features
The performance of the fund will be benchmarked against the Nifty Financial Services Total Return Index (TRI). Units of the scheme are not proposed to be listed on any stock exchange. Following the NFO, subscriptions and redemptions will be permitted on all business days, with redemption proceeds scheduled to be paid within three working days, in accordance with applicable regulations.
Plans, Exit Load and Minimum Investment
The scheme will offer both Direct and Regular plans, each available with Growth and Income Distribution cum Capital Withdrawal (IDCW) options. An exit load of 1% will be applicable if units are redeemed within 90 days from the date of allotment. No exit load will be charged for redemptions made after this period.
The minimum application amount during the NFO and on an ongoing basis has been set at ₹500. Systematic Investment Plan (SIP) investments will be available starting at ₹100 for daily SIPs and ₹500 for weekly and monthly SIP options.
Summary
Motilal Oswal Mutual Fund has filed draft papers to launch the Motilal Oswal Financial Services Fund, an open-ended sectoral equity scheme focused on financial services companies. The fund will invest a majority of its assets in equities within the sector, benchmarked against the Nifty Financial Services TRI, and will be offered at ₹10 per unit during the NFO, with flexible investment and redemption options post launch.
Disclaimer:
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