The SBI stable has 48 funds with 18 equity, 18 debt, 10 hybrid and 2 gold schemes, which gives it the necessary scale. The AMC has a more or less complete range of funds across categories and themes, with the notable exception of international funds and banking focussed fund. The fund management team has 5 equity fund managers and 3 debt fund managers, supported by 8 analysts supervised by a head of research and 4 dealers and around 12 support staff. The equity team reports to the CIO, Navneet Munot.
The earliest fund scheme, Magnum Equity, a large-cap fund which was launched in 1992, and continues to weather the markets to be among the best in the category. In recent times, closed-end capital protection funds have found way into the group, which toe a conservative line. One look at the fund schemes, and the AMC cannot shy away from being an active player with the mad NFO rush between 2004 and 2008, trying to ride the market boom.
The equity funds also have notable multiplicity in the form of 3 mid- and small-cap funds, 2 large-cap funds and 4 large- and mid-cap funds, besides many sector and thematic funds. Such duplication is avoidable and could be re-looked into and tapered to have a much more manageable portfolio.
The debt portfolio, a stronghold of the fund house, has a full range of offerings which caters to both institutions and retail investors. Here again, redundancies can be avoided to maintain a full-offer portfolio.
There are also some funds such as SBI Edge, SBI Magnum MIP Floater, and SBI Magnum Income Floating Rate LT Retail; which manage miniscule assets of Rs 1.81 crore, Rs 8.2 crore and Rs 11.07 crore respectively, besides 8 other schemes that manage less than Rs 50 crore. While, most investors do not need these funds, the fund house should consider merging these schemes in to those that are closest and enhance operational efficiency.
The best and worst performers
The AMC has 48 funds with performance spread from the top to the bottom quartile. The fund house has very few top performing funds across the 25 Value Research fund categories, with SBI Magnum Contra, SBI Magnum MultiCap and SBI Magnum COMMA, being the worst performing funds in their respective categories.
The one-year performance of the markets and the SBI funds have mirrored the performance. For instance, the two sectors – FMCG and pharma – have been the best and so have the sector funds from the AMC. Likewise, the technology sector has been the most hit, which is reflected in the performance of the technology fund from SBI.
Yet, a lot has gone well for the AMC, especially with SBI Bluechip, which has been the best performing fund in the large- and mid-cap category. Also, SBI Magnum Emerging Businesses has been the second best performing fund in the mid- and small-cap category. Looking at the sector allocation, there is a constant tilt towards technology and healthcare, which on an average account for 30 per cent exposure. The other notable variation over the past decade is the reduction in exposure to FMCG from 2002-2008 and the increase in exposure to financial sector from 2009.
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