Baroda BNP Paribas Mutual Fund announced the launch of Baroda BNP Paribas Value Fund, an open-ended equity scheme following a value investment strategy. The fund aims at creating wealth for the long-term investors. The fund will be managed by Shiv Chanani (Senior Fund Manager) who comes with over 21 years of experience, and the performance will be benchmarked against Nifty 500 Index.
The Fund aims to achieve long term capital growth by investing in a diversified portfolio of companies selected using principles of value investing. The fund would identify mispriced opportunities between the intrinsic value and the prevailing market price. To identify these opportunities the fund would look for stocks which trade at a discount to the overall market, their own historical average valuations or relative to their fundamental valuations.
The fund believes that value opportunities are available in the equity markets at multiple levels: a) Broad Market often over-reacts to crises as seen in GFC in 2008 or COVID meltdown in 2020.This can provide attractive opportunities across the market; b) Sector specific challenges like short term supply chain disruptions, regulatory changes, etc. provide value opportunities at the sector level; and c) finally, company specific opportunities unearthed through our bottom up research.
The Scheme will invest in Equity & Equity related instruments (65% – 100%), Debt & Money Market instruments (0% – 35%), Units issued by REITs & INvITs (0% – 10%) and Units of Mutual Fund Schemes (0% – 10%)
“At Baroda BNP Paribas AMC, we have a strong investment culture backed by a disciplined framework, seasoned team, and robust processes. In our new fund, Baroda BNP Paribas Value Fund we aim to identify investment opportunities where stocks are available at a discount to their intrinsic value. These opportunities can be across stocks, sectors, and market caps. To manage risk, we have a robust margin of safety framework:- Margin of safety in balance sheet, in earnings, and in valuation represent our ‘3 S Framework”. said Suresh Soni, CEO, Baroda BNP Paribas Mutual Fund.
The scheme is suitable for patient long term investors who are looking to create long-term wealth by invest in value stocks with adequate margin of safety and looking for diversification from growth-oriented portfolios. The fund aims to benefit from the potential earnings growth as well as the valuation re-rating.
The NFO opens on May 17, 2023, and closes on May 31, 2023