SBI Consumption Opportunities Fund

The target stocks are companies in the consumption space like consumer durables and non-durables, retail, auto, airlines, commerce, hospitality industry, entertainment, and media to provide a wide berth. Since the asset allocation is in stocks, the returns are dependent on market volatility, therefore carry a high risk. 

Brief Introduction of the Fund

Investors staying invested in the SBI Consumption Opportunities Fund will likely reap a handsome harvest for the long term. The asset allocation pattern in the portfolio reveals nearly 97.38% in consumption sector stocks, including derivatives and foreign securities. It comprises 28.13% large-cap, 23.70% in midcap, and 33.56% in small-cap equities. 

The Fund Managers ensure the right blend of diversification to ensure higher yields beating inflation. Therefore, the remaining assets are allocated in various instruments like 0.03% in low-risk Debt Securities. The scheme thus suits investors who are not risk-averse and have long time horizons for capital appreciation to fulfil their financial goals. 

The SBI Consumption Opportunities Fund offers the following plans for investors to choose from:

1. SBI Consumption Opportunities Fund Direct

   • Growth Option
   • IDCW Option

2. SBI Consumption Opportunities Fund Regular

   • Growth Option
   • IDCW Option

Fund Facts

Investment Objective

The investment objective of the SBI Consumption Opportunities Fund is to provide opportunities for long-term capital appreciation. To achieve higher yields in the long-term horizon, the Fund employs a bottom-up strategy to pick stocks in a wide range of companies operating in the consumption space. Therefore, the asset allocation is between 80% and 100% in company equity. 

For a diversified portfolio to counterbalance losses from the high-risk equity market fluctuations, the Fund has the flexibility to allocate assets up to 20% in a basket of varied instruments.

These investments usually comprise other equities and equity-related instruments, REIT and InvIT units, debt, securitized debt instruments, and money market instruments. 

Fund Summary

1. SBI Consumption Opportunities Fund-Growth Regular Plan

   • Risk Level: Very High
   • NAV: Rs.153.0779 as of 18 June 2021.
   • Expense Ratio: 2.51% as of 30 April 2021
   • Fund Started On: 5 July 1999

2. SBI Consumption Opportunities Fund-Growth Direct Plan

   • Risk Level: Very High
   • NAV: Rs.167.1839 as of 18 June 2021
   • Expense Ratio: 1.44% as of 30 April 2021
   • Fund Started On: 1 January 2013

Fund Returns Summary

1. SBI Consumption Opportunities Fund-Growth Regular Plan

   Period	Annualized Return %	Absolute Returns %
   Last 1 year	65.47	65.47
   Last 2 years	17.94	39.15
   Last 3 years	8.94	29.31
   Last 5 years	14.07	93.24
   Since Inception	14.01	203.49

   Legend

   *Performance as of 18 June 2021 (NAV).

   Compounding is annualized for greater than one year returns.

   Returns since inception are determined by the unit allotment price of Rs.10

   Benchmark is Nifty India Consumption Index (TRI)

2. SBI Consumption Opportunities Fund-Growth Direct Plan

   Period	Annualized Return %	Absolute  Returns %
   Last 1 year	67.21	67.21
   Last 2 years	19.19	42.14
   Last 3 years	10.14	33.66
   Last 5 years	15.29	103.88
   Since Inception	15.37	234.64

   *Performance as of 18 June 2021 (NAV)

   Compounding is annualized for greater than one year returns.

   Returns since inception are determined by the unit allotment price of Rs.10

   Benchmark is Nifty India Consumption  Index (TRI)

Pros and Cons 

Benefits of SBI Consumption Opportunities Fund

The scheme’s primary aim is to help investors reap higher yields in the long term by a reasonable allocation of assets in company stocks in the consumption space. It suits investors conversant with the macro trends and willing to bet on selective stocks for higher returns in the long-term horizon.

The benefits accrued from the SBI Consumption Opportunities Fund are:

• Convenience: The investor can conveniently invest small sums in the Fund, starting from Rs.5000, other than SIP, starting at Rs.500. The SIP mode further allows flexibility to choose various frequencies, with altered minimum investment limits. 
• Liquidity: The SBI Consumption Opportunities Fund is an open-ended equity scheme, meaning the AMC freely repurchases it on any business day at the prevailing NAV. 

The redemption can be requested online at the AMC portal or the Distributor’s office. As per SEBI rules, redemption proceeds must be dispatched within ten business days, or the AMC must pay an interest of 15% per annum for the period of delay. 

• Taxation: The earnings in the funds upon redemption are subject to invite Capital Gains Tax as per extant laws. It is implied that there is no taxation if units in the Growth Plan are not sold. On the other hand, dividends are added to the investor’s income for taxation at the applicable tax slab rate. Dividend above Rs.5000 invites TDS at 10%. 

Fund House Details

SBI Consumption Opportunities Fund is an MF scheme from the Asset Management Company (AMC) styled as the SBI Funds Management Pvt. Ltd. with an over thirty-year legacy of consistently delivering value to investors. 

It is a joint venture between the State Bank of India with a 63% stake and France’s Amundi Asset Management with a 37% stake. Amundi operates through its subsidiary Amundi India Holding. The Company aims to build an international reputation in Funds Management by adopting global best practices. 

Popularly known as SBI Mutual Fund, SBI Funds Management Pvt Ltd was incorporated in 1987 as the first non-UTI Fund with its headquarters in Mumbai. Today, it manages 46 Mutual Fund schemes catering to varied tastes. It has a clientele size of over six million customers served through 212 branches, spread across India.  The Assets Under Management (AUM), valued at Rs 5.05 Lac Cr as of 31 March 2021, bears testimony of its sway in the Indian Mutual Fund market.

Who Should Invest in SBI Consumption Opportunities Fund?

Since it is a thematic equity fund, the SBI Consumption Opportunities Fund carries a very high risk due to market volatility. It is suitable for investors willing to invest in equities across different capitalizations in the consumption space and stay invested in the long time horizons. 

The following indicative list describes those who can invest in the scheme:

• Adult Indian resident individuals singly or jointly 
• A Karta of the Hindu undivided family (HUF)
• NRI or PIO both on a repatriable and non-repatriable basis 
• Minors whose accounts are operated by parents or legal guardians
• Companies, Corporate Bodies, and Public Sector Undertakings and Enterprises
• Registered Associations, Societies, and Trusts 
• Banks and Financial Institutions
• SBI MF Schemes and also other AMCs 

Wrapping It Up

The SBI Consumption Opportunities Fund is an open-ended thematic equity scheme that provides dual benefits of long-term capital appreciation and liquidity with a ready redemption facility. 

Though the scheme is high-risk by nature, it is ideal for investors with a matching profile and an objective of growing money in the long term to achieve life’s goals and milestones.

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