SBI Mutual Fund re-classifies schemes; gives exit option to unit holders

The fund house has given the exit option to existing investors. The move is part of the fund house effort to comply with markets regulator Sebi's directive.

Published: 15th April 2018 12:37 PM  |   Last Updated: 15th April 2018 12:37 PM   |  A+A-

The logo of State Bank of India (SBI). (File photo | Reuters)



NEW DELHI: SBI Asset Management Company has re-classified and categorised its several schemes, a move that will reduce clutter and make it simple to compare performance of various other mutual fund schemes.

Besides, the fund house has given the exit option to existing investors. The move is part of the fund house effort to comply with markets regulator Sebi's directive.

In a letter to investors, the fund house said, "Certain changes will be carried out in the features of some of our schemes, resulting in changes in fundamental attributes of certain schemes of SBI Mutual Fund (MF)".

Some of the existing schemes that will see changes are -- Magnum Equity Fund, Magnum Multiplier Fund, Emerging Businesses Fund, FMCG Fund, IT Fund, Pharma Fund and Corporate Bond Fund.

The fund house said that the proposed changes in type of scheme, investment objective, asset allocation and investment strategy amount to change in the fundamental attributes of the scheme. Accordingly, existing unit holders, who are not in agreement with changes, will have the option to redeem or switch their units at applicable net asset value (NAV) without any exit load.

The option to exit without payment of exit load will be valid from April 16 to May 15. Such exit option will not be available to unit holders, whose units have been pledged.

"Any redemption or switch request received after May 15 will be subject to the prevailing load structure as applicable and will not qualify for the waiver of the exit load," it added.

Further, it said that no action is required in case unit holders are in agreement with the change. This offer to exit or switch is merely an option and is not compulsory.

"Redemption/ switch-out by the unit holders due to aforesaid change or due to any other reasons may entail tax consequences.  Unit holders are advised to consult their tax advisor for the same," the fund house said.

In a bid to reduce the number of schemes in mutual funds, Sebi, in October, came out with uniform definitions for fund categories. The move is applicable only on open-ended funds being offered by the fund houses.

The market regulator broadly divided mutual funds into five categories- equity funds, debt funds, hybrid funds and solution-oriented funds and other funds. It had asked fund houses to adhere to these guidelines within two months in letter and spirit.

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp