Aditya birla banking and financial services fund : Review

Complete analysis of Aditya birla banking and financial services fund.

Investment Objective:

The primary investment objective of the scheme is to generate long term capital appreciation to unit holders from a portfolio that is invested predominantly in equity and equity related securities of companies engaged in banking and financial services.

The scheme does not guarantee/indicate any returns. There can be no assurance that the schemes objectives will be achieved.

Investments Strategy:

Fund proposes to adopt a disciplined flexible long term approach to investing with a focus of generating long term capital appreciation by investing in the Banking and Financial Services sector.

Banking and Financial Services includes, Banks, Broking Cos, Wealth Management Cos, Insurance Cos, NBFCs, Investment Banking Cos, Rating Agencies, Micro Finance Cos, Housing Finance Cos, etc.

Fund manager intends to broadly analyse macro situation as Banking sector is largely correlated with macro variables.

banking fund

Fund will follow the four steps in search of investment ideas.

1.Evaluating Business,Focus on Management,Valuations,Capital Efficiency will be on focus.

2.Fund will adopt an active management style to optimize returns.

3. Fund will follow a bottom up approach to identify bargain stocks with the flexibility to invest across the market capitalization.

4. Fund will do periodically review on the companies which is in portfolio.

EMI VS SIP ( Be controlled or take control )

Download the current Fact sheet

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Fund Management

Mr. Satyabrata Mohanty

Total Experience : 16 years

Mr. Satyabrata Mohanty is a CA, CFA. He has been part of Birla group since last 17 years. He has over 12 years of experience in Finance and Research. He has handled responsibilities across Fund Management (Equity & Debt), Trading and Credit Research functions. Prior to joining BSLAMC, he has worked with Aditya Birla Management Corporation Ltd & joined ABG as a management Trainee.

Mr. Dhaval Gala

Total Experience : 9 years

Mr. Dhaval Gala has an overall experience of around 9 years in financial markets. He has over 8 years of experience in doing investment research and analysis in Banking & Financial Services sector. He joined BSLAMC in February 2011, since then he has been a part of the research team. Prior to joining BSLAMC, he has worked with B&K Securities (January 2008 – February 2011) and J. P. Morgan Chase India Private Ltd (May 2005 – July 2006).

Some chart to Understand the performance

Performance Line Chart


Cumulative Performance (%) and Discrete Performance (%)


Static Scatter Chart


Rolling Bar Chart ( Excess return )

excess return

Regular withdrawal Chart


Amount Invested Lump sum Rs.1000000/-

Withdrawal Amount Rs. 10000/- ( Monthly )

Scheme Withdrawal Period No of Monthly Installments Total Withdrawal Amount Current Value Return (%)
Aditya Birla Sun Life Banking and Financial Services Fund  01-01-2014 to 24-01-2018 49 490,000 2,00,7891 30.04

Regular Saving Chart


Ratio Table ( Most Important )


Banking on New Opportunities:

Fortunes of the banking and financial services sector are typically linked with economic growth. There are numerous factors that work in favour of the banking and financial services sector.

Rs. 4 Lakh In Reliance Banking Fund Turns Over Rs. 1 Crore In Less Than 15 Years

Some of the key factors are:

Robust demand from middle class, rural penetration and technology-enabled services. According to a report by the National Council for Applied Economic Research’s (NCAER) Centre for Macro Consumer Research, by 2015-16, India will be a country of 53.3 million middle class households, translating into 267 million people. Characteristics of the rising middle class include higher purchasing power and also the ability take on extra debt to meet their aspiring lifestyle. Similarly with the advent of technology, the reach of banks has extended to envelope the rural population that was previously unbankable. As a result, the banking and financial services sector has been able to deliver better returns.

Portfolio Characteristics

Total Stocks                        32

Avg Mkt Cap (Rs.Cr)          50303

Portfolio P/B Ratio             2.98

Portfolio P/E Ratio            27.73

3Y Earnings Growth (%)   4.64

Download the Full Portfolio Listings

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As a Sector fund, the portfolio will concentrate on the companies engaged in Banking and Financial Services. The portfolio manager will adopt an active management style to optimize returns. The scheme would invest in Banks as well as Non-banking Financial Services companies, Insurance companies, Rating agencies, Broking companies, Micro finance companies, Housing Finance companies, Wealth Management companies, etc . The scheme may also invest in IPOs of companies which could be classified under Financial Services sector.

Download the Full Portfolio Holding

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Investing in a Sectoral fund is based on the premise that the Fund will seek to invest in companies belonging to a specific sector. This will limit the capability of the Fund to invest in other sectors.

The scheme being sector specific will be affected by the risks associated with the Banking Sector and investments in Financial services companies which provide non banking financial services like housing finance, stock broking, wealth management, insurance companies and holding companies of insurance companies and hence concentration risk is expected to be high.

Also, as with all equity investing, there is the risk that companies in that specific sector will not achieve its expected earnings results, or that an unexpected change in the market or within the company may occur, both of which may adversely affect investment results. Thus investing in a sector specific fund could involve potentially greater volatility and risk.

Risk Factors associated with investments in Fixed Income Securities.

Price Risk or Interest Rate Risk, Credit Risk, Liquidity or Marketability Risk, Reinvestment Risk, Pre payment Risk, The Scheme shall not invest in Foreign Securities.

Risk Factors associated with investments in Derivatives.

The risks associated with the use of derivatives are different from or possibly greater than, the risks associated with investing directly in securities and other traditional investments.

Risks associated with investments in Securitised Debt.

Limited Recourse and Credit Risk,Bankruptcy Risk,Risk of Coingling, Prepayment Risk, Credit Risk, Liquidity Risk, Conversion risk.

Risks associated with Asset Backed Securities (ABS) Auto Loans,Prepayment Risk,Credit Risk,Liquidity Risk,Risks associated with Asset Backed Securities (ABS) Corporate Loans,Credit Risk,Prepayment Risk,Limited Liquidity and Price Risk.

Who should invest in such funds? Do sector funds carry a higher risk?

We believe sectoral funds carry higher risk than diversified equity mutual funds. Hence these funds are appropriate investment tools for investors believing that a particular group of stocks will perform better than market indices. At times, they may find favour with a regular equity investor who has a higher risk appetite.

For example, if you believe there will be a series of rate cuts and banks would benefit due to that, banking sector funds will be big beneficiary. Sector funds tend to be riskier and more volatile than the broad market because they are less diversified, although risk levels depend on the specific sector.

Note : Past performance of fund does not guarantee the future returns.


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.

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