Business Today

The new wave of NFOs

For fund investors, there are plenty of opportunities this December. Four new fund offers with different investing themes, ranging from overseas investing to the infrastructure theme, are open for investors. Take the plunge if your asset mix needs a rejig.

Nitya Varadarajan        Print Edition: December 30, 2007

For fund investors, there are plenty of opportunities this December. Four new fund offers with different investing themes, ranging from overseas investing to the infrastructure theme, are open for investors. Take the plunge if your asset mix needs a rejig.

A scheme that invests in equities in Asia is the Franklin Asian Equity Fund. The fund will invest up to 40 per cent in India and up to 70-100 per cent in Asian equities. It will limit its exposure to any other country up to 25 per cent of its corpus. In a presentation, Sukumar Rajah, CIO, Franklin Equity and its Principal Portfolio Manager, says: “The Indian market ranked seventh in Asian markets in 2001 and was #4 in 2006. With better performing markets outside India within Asia, the fund provides a good opportunity for diversification.”

The Kotak Indo World Infrastructure Fund will, typically, invest in companies in sectors like ports, roads, telecom, construction, engineering and aviation. The fund will invest 35 per cent of its corpus in global equities and infrastructure mutual funds, and the balance in Indian infrastructure stocks. But unlike Franklin’s Asian Equity Fund, which is considered equivalent to a debt fund for tax purposes attracting a 10 per cent capital gains tax, the Indo World Infrastructure Fund will be treated as an equity fund and, therefore, is exempt from tax. Funds that have at least 65 per cent exposure in Indian equities are eligible for tax breaks. The JM Agri and Infra Fund will invest equally in agri and infrastructure stocks. The DBS Chola Small Cap will invest in small companies that are growing.

Broadening the Investment World

Fund: Franklin Asian Equity Fund
Theme: Open-ended equity fund investing in Asia, except Japan
Load structure: 2.25 per cent entry load; 1.5 per cent, if redeemed within six months and 0.5 per cent within one year

Fund: Kotak Indo World Infrastructure Fund
Theme: 3-year close-ended fund, with focus on equity, units of overseas MFs
Load structure: Zero entry load; unamortised charges will be reduced for premature withdrawals

Fund: JM Agri & Infra Fund
Theme: 3-year close-ended equity fund that will focus on agriculture and infrastructure development companies
Load structure: Zero entry load; unamortised charges will be reduced for premature withdrawals

Fund: DBS Chola Small Cap Fund
Theme: 3 year close-ended equity scheme that will look at small-cap stocks
Load structure: Zero entry load; exit load only on premature withdrawals

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