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Auto Theme in India

Did you know that India forms only 5% of global car by volumes and 2% by value! The potential in the Indian automotive sector is truly immense and now is your chance to benefit from the growing automotive ecosystem in India by investing in the

SBI Automotive Opportunities Fund.

Source: IBEF, OICA, Company Disclosures, Internal research, Industry Estimates

Why invest in the Indian Automotive Sector?

Urbanization and Rising Income

Rapid urbanization and a growing middle-class population fueled by rising disposable incomes, indicate significant potential for increased motor vehicle ownership.

Vehicle Credit Expansion

Vehicle financing plays a key role in defining the potential of the automotive theme in India. As vehicle financing becomes easier, the demand for it grows and subsequently the demand for automobiles. As per RBI Data vehicle finance is among the largest loan segments within retail and commercial credit.

Government policies and initiative

Policies like the Production Linked Incentive (PLI) scheme, 100% FDI allowance, Automotive Mission Plan (AMP) 2016-26, Vehicle Scrappage Policy (Launched in 2021), and Faster Adoption and Manufacturing of Hybrid & Electric Vehicles (FAME): schemes are expected to drive industry growth and innovation
With increasing road accidents in the last few years, the government mandated to add safety features like ABS, driver and passenger airbags, seat belt reminders etc. and has set a target to reduce accidents by 50% till 2030.

About SBI Automotive Opportunities Fund

SBI Automotive Opportunities Fund is an open-ended equity scheme following automotive & allied business activities theme. The fund aims to generate long-term capital appreciation to unitholders from a portfolio investing in equity and equity related instruments of companies engaged in automotive & allied business activities theme.

Investment Universe of the Fund

Stock picking will be done using active investment strategy by focusing on robust fundamentals and navigating through conducive environment of growth for auto segment. The aim will be to capitalise on growth trajectory of auto and auto ancillary companies. Few of the segments that would be explored for investment are given below. Note that these are some of the segments within the auto universe, but the list is not exhaustive.

OEMs include two-wheeler, three-wheeler, passenger, commercial vehicle, heavy vehicle manufacturers, and more.

Auto component manufacturers

These include engine, electronic chips, transmission parts, tyres, nuts & bolts, etc. They supply to both to OEMs and the service providers.

Electric Mobility

India's EV ecosystem is burgeoning, driven by emission reduction goals, and improving EV economics. Investment opportunities lie in pure-play EV manufacturers or component makers specializing in EV parts like batteries, motors, and control systems.

Export Opportunities

India's automotive industry has potential for exports in various segments. Amid rising global manufacturing costs, India can leverage its large domestic market for economies of scale.

OEMs include two-wheeler, three-wheeler, passenger, commercial vehicle, heavy vehicle manufacturers, and more.

Auto component manufacturers

These include engine, electronic chips, transmission parts, tyres, nuts & bolts, etc. They supply to both to OEMs and the service providers.

Electric Mobility

Export Opportunities

India's automotive industry has potential for exports in various segments. Amid rising global manufacturing costs, India can leverage its large domestic market for economies of scale.

Source: CMIE Economic Outlook, company annual reports, ICED dashboard, Internal Research.

Fund Facts

Scheme Name

SBI Automotive Opportunities Fund

Type of Scheme

An open-ended equity scheme following automotive & allied business activities theme.

Investment Objective

The investment objective of the scheme is to generate long-term capital appreciation to unit holders from a portfolio that is invested in equity and equity related instruments of companies engaged in automotive & allied business activities theme.
However, there can be no assurance that the investment objective of the Scheme will be realized

Plans & Options

Regular & Direct Plan ; Both plans provide two options – Growth Option and Income Distribution cum capital withdrawal (IDCW) Option

Application Amount

Minimum Investment Amount: Rs 5000/- and in multiples of Re. 1 thereafter.
Additional Purchase Amount: Rs. 1000/- and in multiples of Re. 1 thereafter.
Minimum Monthly SIP Amount: Rs 500/- and in multiples of Re. 1 thereafter.

Fund Manager

Mr. Tanmaya Desai
Mr. Pradeep Kesavan (overseas securities)

Benchmark

NIFTY Auto TRI

Exit Load

For exit on or before 1 year from the date of allotment: 1% and
For exit after 1 year from the date of allotment: Nil
The AMC reserves the right to modify / change the load structure on a prospective basis.