Sebi pulls up Samco MF for calling its scheme a ‘pure’ equity fund

The capital markets regulator has pulled up Samco Mutual Fund, a new entrant to the market, for calling its maiden scheme a pure equity fund and not incorporating the clauses pertaining to its tool to pick stocks in the scheme information document (SID) of the new fund offer (NFO).

The Securities and Exchange Board of India has also asked the fund house to change its “Stress Tested Mutual Fund” tagline.

Existing unit holders have the option to exit the scheme before February 24 without any exit load and the regulator has directed the fund house to pay interest at the rate of 15% a-year to such unit holder from the date of closure of the NFO till date of the payment.

The fund house launched the NFO of its maiden scheme, Samco Flexi Cap Fund, last month. The stock pick is based on an in-house proprietary investment framework, called the Hexashield Framework, which shortlists companies on six parameters: competitive strength and pricing power, balance sheet and insolvency, reinvestment and growth, corporate governance and leadership, cash flow and regulatory compliance.