Baroda BNP Paribas Mutual Fund has introduced its new scheme, the Baroda BNP Paribas Energy Opportunities Fund, which will be open for subscription from 21 January 2025 to 4 February 2025.
This fund aims to give investors the opportunity to benefit from the growing energy sector in India. The scheme will be benchmarked to the Nifty Energy TRI.
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Investment Details and Options
The minimum investment for this fund starts at ₹1,000, with subsequent investments allowed in multiples of ₹1.
Investors can opt for daily, weekly, or monthly Systematic Investment Plans (SIPs) in multiples of ₹500 or ₹1, with quarterly SIPs starting from ₹1,500.
The fund is managed by Sanjay Chawla and Sandeep Jain. An exit load of 1% will be charged if the investment is redeemed or switched out within a year. Otherwise, there is no exit load.
Focus on Energy-Related Companies
The Baroda BNP Paribas Energy Opportunities Fund plans to invest at least 80% of its assets in companies connected to the energy sector.
These include companies involved in mining, oil exploration, oil refining, energy generation, power transmission, gas distribution, and energy services. This focus aims to tap into India’s expanding energy demand as the country’s economy grows.
Who Should Invest?
This fund is suitable for investors who:
1) Want to focus on energy companies.
2) Are looking to take part in India’s growth journey.
3) Seek to diversify their portfolios with investments in new sectors or themes.
Investors should consider a 3-year or longer holding period, as the scheme is designed for long-term equity investors.
India’s Growing Energy Demand
Suresh Soni, CEO of Baroda BNP Paribas Asset Management India Pvt. Ltd, emphasized the importance of energy in national prosperity.
As India’s GDP grows, so does its energy demand, expected to increase by 1.7 times over the next 5 years.
With this in mind, the Baroda BNP Paribas Energy Opportunities Fund aims to unlock attractive investment opportunities in India’s expanding energy sector.
Strong Growth in Energy Consumption
India’s energy consumption is expected to rise significantly, similar to the trends seen in countries like China and South Korea.
The demand spans various sectors including households, agriculture, industry, and infrastructure, driven by India’s growing middle class and changing lifestyles.
Sanjay Chawla, the fund manager, noted that energy is a broad investment theme, and Nifty Energy TRI has shown better performance compared to the Nifty 500 TRI over multiple time periods.
The fund will focus on opportunities in both traditional energy sources and the emerging energy transition, reflecting India’s long-term energy needs and growth potential.