Sbi Mutual Declares 1:2 Bonus For It Fund

SBI Mutual Fund, which manages close to Rs 5,500 crore through its domestic and offshore schemes, has declared a 1:2 bonus for its sectoral fund, Magnum IT Fund.

The fund will also be declaring a dividend of 40 per cent to its unitholders. It has decided to declare March 10 as the record date for the payment of dividends.

The fund, which comes under the Magnun Sector Funds Umbrella, has three other schemes, FMCG Fund, Pharma Fund and Contra Fund Schemes. The information technology (IT) scheme has shown an appreciation of nearly 342 per cent during the last eight months.

 

Since June 1999, the IT fund has outperformed the Sensex by 307 per cent and the S&P CNX Sectoral index by 71 per cent.

In order to discourage dividend-stripping,

the fund will also levy a short-term exit-cum-switch-over load of 2.5 per cent on investors exiting or switching over their investment in the scheme before June 10.

Niamatullah, managing director of SBI Mutual Fund, said: "The announcement of a liberal bonus of 1:2 within just eight months of launching the scheme clearly reflects the outstanding performance of the fund. The issue of bonus is an endeavor on the part of SBI Mutual Fund to share the benefits with our esteemed investors."

Sachin Sawrikar, fund manager of Magnum IT Fund, added: "We started with a base amount of just Rs 2.93 crore in June and currently manages over Rs 100 crore in the IT fund. The fund's net asset value as on February 16 stood at Rs 47.99. It has to its credit stocks like Infosys, Satyam computer, Wipro, SSI and Visual Soft which have continuously outperformed the markets."

Commenting on its investment strategy, Sawrikar said: "Primarily the IT sector is expected to grow between 50-60 per cent per annum. Given these parameters, a fund manager's talent is identified by his stock-picking ability and the investments in niche infotech areas like e-commerce and Internet-related activities. Secondly, once invested, the fund continues to grow along with the company as our investments are usually spread for a long-term prospective."