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Kotak Mahindra Mutual Fund is launching a new fund offer for an ESG fund. Kotak ESG Opportunities Fund will open for subscriptions on November 20 and will close on December 4. Here are the details about the fund. Read on!

What are ESG Funds?

Environmental, social and governance-focused (ESG) funds invest in stocks of companies that do not cause any adverse environmental impact or social risks through its business activities. ESG fund managers mostly avoid companies that manufacture tobacco, alcoholic products or engage in gambling. According to the mutual fund classifications laid out by the Securities and Exchange Board of India (Sebi), ESG funds fall under the thematic fund category.

Investment Strategy

The mutual fund scheme will be an open-ended equity fund that invests in companies following the environmental, social and governance (ESG) criteria. 

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Also read :  What is ESG Investing?

Here is what the indicative asset allocation looks like for the fund:

Asset ClassInstrumentsIndicative Allocation (% of net assets)Risk Profile
MinimumMaximumHigh/Medium/Low
AEquity & Equity related instruments80100High
A1Equity & Equity related instruments of companies identified based on the Environmental, Social and Governance (ESG) criteria80100High
A2Equity & Equity related instruments other than those under A1020Medium to High
BDebt and Money market instruments020Low to Medium
CUnits issued by REITs and InvITs010Medium to High

Benchmark

Kotak ESG Fund will benchmark its performance against the Nifty 100 ESG TRI index. The index consists of companies that are a part of the Nifty 100 index but based also qualify for the ESG criteria. The weight of each constituent in the Nifty 100 ESG index is calculated based on the ESG score of the company. 

To be eligible for the ESG index, stocks should fulfil the following criteria:

  • Stocks should be a part of Nifty 100
  • Companies should have an ESG score
  • Companies with controversy category 4 and 5 will be excluded. The scale goes from 1 to 5 with 1 being the least controversial. 
  • Companies manufacturing alcohol, tobacco, controversial weapons or the ones which engage in gambling operations are excluded.

Fund Details

The fund will have both regular and direct plans. Under both plans, you will have the option to pick between growth and dividend options. Dividend payout and reinvestment plans are also available under the dividend option.

Here are all the details of the ESG Fund

Name of the FundKotak ESG Opportunities Fund 
Type of SchemeAn open-ended equity scheme following the Environmental, Social and Governance (ESG) theme
BenchmarkNifty 100 ESG TRI
NFO DatesOpens on November 20, 2020, and closes on December 4, 2020
Fund ManagerHarsha Upadhyaya, Arjun Khanna
Minimum Application Amount/Minimum Purchase Amount (including switches)Rs. 5,000 and in multiples of Re. 1 after that
Minimum Additional Investment (including switches)Rs. 1000/- and in multiples of Rs 1 for purchases and Re. 0.01 for switches
Minimum Redemption AmountIn Rs: Rs 1,000

In Units: 100 units

Entry LoadNil
Exit Load1%: If more units are redeemed/switched on or before 12 months from the date of allotment of Unit

NIL: If Units are redeemed/switched after 12 months from the date of allotment of units: Nil 

PlansRegular Plan and Direct Plan
OptionsGrowth and Dividend Option (Payout, Dividend Reinvestment Option)
Facilities Available
  • Systematic Investment Plan (SIP)
  • Systematic Withdrawal Plan (SWP)
  • Systematic Transfer Plan (STP)

Fund Managers

Harsha Upadhyaya

Harsha Upadhayaya has a two-decade experience in fund management and equity research. Before Kotak MF, he worked with DSP BlackRock Investment Managers, UTI AMC, Reliance Group etc. 

Other schemes managed by Mr Upadhyaya

  • Kotak Equity Opportunities Fund
  • Kotak Standard Multicap Fund
  • Kotak Tax Saver Fund

Arjun Khanna

Arjun Khanna has a 12-year experience with mutual funds in equity research. Before Kotak MF, Mr Khanna worked with Principal Mutual Fund. other funds managed by him are:

  • Kotak Infrastructure & Economic Reform Fund
  • Kotak Bluechip Fund
  • Kotak Equity Hybrid Fund
  • Kotak Emerging Equity Scheme
  • Kotak Equity Savings Fund
  • Kotak Small Cap Fund
  • Kotak Standard Multicap Fund
  • Kotak Debt Hybrid Fund
  • Kotak Equity Opportunities Fund
  • Kotak Banking and PSU Debt Fund
  • Kotak Bond Short Term Fund
  • Kotak Bond
  • Kotak Corporate Bond Fund
  • Kotak Dynamic Bond Fund
  • Kotak Money Market Fund
  • Kotak Credit Risk Fund
  • Kotak Liquid Fund
  • Kotak Low Duration Fund
  • Kotak Medium Term Fund
  • Kotak Savings Fund
  • Kotak Gilt Fund
  • Kotak Balanced Advantage Fund
  • Kotak Global Emerging Market Fund
  • Kotak Asset Allocator
  • Kotak Pioneer Fund
  • Kotak Focused Equity Fund

Happy Investing!

Investment in securities market are subject to market risks, read all the related documents carefully before investing. Please read the Risk Disclosure documents carefully before investing in Equity Shares, Derivatives, Mutual fund, and/or other instruments traded on the Stock Exchanges. As investments are subject to market risks and price fluctuation risk, there is no assurance or guarantee that the investment objectives shall be achieved. NBT do not guarantee any assured returns on any investments. Past performance of securities/instruments is not indicative of their future performance.

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