According to the fund house, the scheme will be open for public subscription till January 19. The fund aims to generate long-term capital growth and/or dividend income by investing in a diversified portfolio of companies with a track record of paying dividends.
KMAMC said the scheme will primarily invest in companies that have paid dividends in at least one of the previous three financial years. In addition to dividend yield, the investment approach will consider factors such as cash flows, earnings growth prospects, business fundamentals and management quality. The fund will focus on mature and relatively stable businesses, with diversification across sectors.
Nilesh Shah, managing director of Kotak Mahindra Asset Management Company, said dividend-paying companies often reflect disciplined business practices and an emphasis on shareholder value. “In the current market environment, looking at companies with sustainable dividends can be a way to add quality and resilience to an investment portfolio,” he said.
The fund house stated that the portfolio will be subject to periodic reviews to identify dividend-yielding opportunities while maintaining alignment with the scheme’s stated objectives. It added that strict filters for financial strength and management quality will be applied during stock selection.
Shibani Kurian Sircar, fund manager for the Kotak Dividend Yield Fund, said the scheme follows a research-driven and disciplined investment process. “The strategy focuses on identifying companies that generate healthy cash flows and maintain consistent dividend payouts, while also offering the potential for long-term growth through careful stock selection and diversification,” she said.
During the new fund offer (NFO) period, investors can make investments with a minimum amount of ₹100 and in multiples thereafter for switches, the fund house said.
KMAMC also cautioned that mutual fund investments are subject to market risks and that the scheme does not guarantee or promise returns. Investors have been advised to consult financial and tax advisors to assess the suitability of the product.
Kotak Mahindra Asset Management Company is a wholly owned subsidiary of Kotak Mahindra Bank and has been managing mutual fund schemes since 1998. As of September 2023, it reported over 53 lakh investor folios across its schemes.
