SME Times News Bureau | 15 Jul, 2021
Analysts have questioned as to how Zomato, which is a loss making
company, fits into the investment framework of ICICI Dividend Yield Fund
which invests in dividend yielding stocks.
Kartik Sankaran, Founder, Fiscal Fitness raised the issue in a comment on a social media platform.
"Hey
folks at ICICI Prudential AMC Ltd. could you help understand how Zomato
fits into the investment framework of the ICICI Dividend Yield Fund?"
Sankaran asked.
"As per your website, this fund is suitable for
investors who aim to invest in a portfolio of dividend-yielding stocks
and achieve goals like Retirement Planning and Wealth Creation."
Digging
into the SID the scheme objective is "... provide medium to long term
capital gains and/or dividend distribution by predominantly investing in
a well-diversified portfolio of equity and equity-related instruments
of dividend yielding companies", he added.
"So how does a
loss-making business fit into the criteria? I understand Zomato may have
a great future and become the largest dividend payer in the country
(sorry Reliance and TCS) but at the time of making investments, it does
not have a dividend track record and should not be part of the universe
for selecting stocks. As the largest AMC would expect some true to the
label fund positioning. "
