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SBI Funds ESG

Scheme Rating

IME Scheme Rating

The Scheme does not meet our selection criteria at this time

Not a recommended fund: This is not a recommended fund, primarily because the AMC does not meet our selection criteria. We believe that there are better fund houses to invest in, within the Indian mutual fund universe.

IME Strategy Rating

Differentiated Strategy focused on Ethical investing: Clear differentiation in strategy given their focus on ESG. ESG investing has been gaining investor interest in recent years and this strategy offers investors the ability to invest in companies that are environmentally friendly, socially responsible and have good governance. Not only would this have interest amongst investors seeking more to invest in more ethically run companies, but the fund flows towards ESG funds can also help these companies perform well in the markets.

PMS Scheme Ratings are driven by IME’s Proprietary Scheme Rating Methodology, which takes into account our ratings of the Scheme’s investment strategy, its maturity, the investment team, and our separate rating on the AMC that runs this particular scheme. Our views on each of these individual criteria are available via the IME RMS – which you can view by reaching out to one of our relationship managers (using either the live chat or book appointment feature on this site).

IME View on SBI Funds ESG

Type: Thematic | Thematic | AUM ( cr) | Inc Date (8 Jul 2016)

Growth with Values Strategy

  • Growth with Values is a multi cap Strategy– spanning across Large, Mid and Small cap 
  • Focusing on investing in companies that meet positive standards of ESG repsonsibility.
  • Selecting companies that are disproportionate beneficiaries of Economic growth at reasonable price

Investment Philosophy

SBI Growth with Values is multi cap focused strategy predominantly looking for companies based on specific ESG criteria. They aim at buying good business run by great people at attractive price. 

Key Aspects of the Philosophy 

  • Management: Looking for companies that have integrity, long-term vision, a good track record, have efficient capital allocation and are transparent and accountable
  • Business: Companies are chosen that can take advantage of size of opportunity, Return on Capital, Pricing Power, Capital Intensity, risk of disruption. 
  • Valuation: Look for businesses by looking at discounted cash flow and relative valuations. 

ESG Compliant

Investing companies effieciently based on their ESG compliant which is defined based on:

  • Environment (E)– complying with Climate change, carbon emission, natural capital, water stress, renewable energy.
  • Social (S) – Efficient utilisation of human capital, good labour standard, product liability, privacy and data security
  • Governance (G) – Companies that have a good corporate governance by having an Independent Board, Pay, Accounting, Business Ethics & Minority shareholder protection

Investment Process

  • Step 1 Qualitative Factors: While selecting companies to invest looks at qualitative factors by analysing Business model, the impact of Macro-economic variables on their business model, Company is also analysed based on Porter’s five force and consider sell-side research interaction. 
  • Step 2 External Analysis: Analyse Geo-politics and its impact on business, have a thorough channel checks, meet the management for better understanding of the company and visit the work place or Plant. 
  • Step 3 Forensic Analysis: Examine company based on ROE, ROIC, Earnings risk and debt repayment capabilities to study the quality score of the business. 
  • Step 4 Investment Thesis: Analyse financial statements for the last 5 years and build an investment thesis and valuation model. 
  • Step 5 Investment Decision: Investment decision is finally made based on the target price, if its attractive based on potential upside and if the stock is a strategic fit with other stocks in the portfolio. 

Avoid

Companies that are impacted by excessive leverage.

PORTFOLIO CONSTRUCTION

  • Universe: 1) Active coverage- 330-340 companies, 2) Passive coverage- 220+ companies
  • Active research universe: Analyst preference, stock coverage, Inhouse financial model.
  • ESG Filter: Positive standards of ESF and exclusion screener
  • SGVP Universe: Stocks with profitable growth, capital efficient, sustainable multifold growth
  • SGVP Portfolio: Best fit- opportunity and valuation and PM’s conviction.

Trailing Performance

1yr 3yr 5yr Since Inception
SBI Funds ESG
S&P BSE 500 TRI
Alpha over Broad Mkt BM

Performance as of: 28-Feb-23 | Inception Date: 08-Jul-16

Fund Managers

Gaurav Mehta | 2-star rated FM

CIO- Alternatives | 16 yrs Experience | 2 yrs at current firm

Past Experience: Analyst & Fund manager(SBI mutal fund)

Gaurav Mehta joined SBI Funds Management (SBIFM) in November 2018 as an Equity Analyst in SBI Mutual Fund and subsequently moved to having fund management responsibilities as well. With effect from October 2021, Gaurav is now CIO – Alternatives where he is responsible for managing equity portion of the Portfolio Management Services & Alternative Investment Funds business. Gaurav has over 15 years’ experience in Indian Financial Markets having worked with Ambit Investment Advisors, Ambit Capital, and Edelweiss Capital. Gaurav has completed B.Tech (Chemical Engineering) from IIT, Bombay and holds a post graduate diploma in Management from IIM, Lucknow. Gaurav is also a Charter holder of the CFA Institute, USA

Fee Structure

Fee StructureFee
Fixed Fee Structure2.5
Variable Fee Structures
Exit Fees1yr(1%)

AMC

AMC: SBI Funds PMS (click link for detailed AMC review)

Not a recommended AMC: We are not fans of AMC-promoted PMS's, primarily due to it often being a side-business of the larger MF and without any certainty of the longer-term stability of the investment team. While the research & distribution strengths of the mutual fund can help the PMS scale, this does not make it valuable for investors seeking alternative investment classes. Additionally, SBI PMS is still at a more nascent stage of evolution than other AMC-promoted PMS providers. We do not recommend SBI PMS at this time.

SBI Funds PMS does not meet our criteria for PMS AMC Selection at this time. Understand our AMC rating criteria at AMC Rating Criteria or contact us via the LiveChat to learn more.

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Note: PMS AMC & Scheme Reviews and Ratings are based on IME Capital’s Proprietary Review and Rating Methodology (read more here: AMC Rating & Scheme Ratings). These reflect the unbiased views of our central research team, based on our assessment of the investment value of these PMS/AIF strategies for our investors. We follow a highly stringent rating-criteria, where approximately 50% of PMS AMC’s & strategies would be rated 2-star or below (this is not meant to indicate that these funds are not investment-worthy, but that they do not currently fulfill the requirements we focus on for recommending funds to our investors — based on our internal views on the merit of the AMC/strategy relative to peers). Reviews & Ratings are primarily based on research of publicly available information (SEBI disclosures, PMS websites, PMS-aggregation platforms, webinar recording, media interviews etc.) and no explicit consent is required from AMCs for the same. While we endeavour to do further due-diligence via direct interactions with the investment teams of AMCs, this is typically restricted to AMC’s that meet our foundational fund selection criteria (reviews on lower-rated AMCs are often based solely on publicly available information). The views reflected in our Reviews & Ratings, are our independent views and may not be shared by the AMC’s and the investment teams. Please read detailed disclaimer for more.