NFONEST

April 2013

IT relief for under subscribed RGESS?

Market regulator SEBI is looking at how the interest of RGESS investors can be safeguarded with regard to I-T relief even if fund houses return their money for failing to raise the targeted amount. As per SEBI regulations, if a new fund offer (NFO) is not able to garner the minimum amount, the fund house has to return the money to investors within a certain period, failing which it has to pay penal interest of 15% to the investor. With some fund houses not being able to mop up the minimum subscription for the RGESS, they would be required to return the money to all those who had invested in the scheme. However, in that case, the investors would lose out on income tax relief to which they were otherwise entitled to. Under the scheme, an individual with an income of under Rs 12 lakh would get tax incentives for investing up to Rs 50,000.

With high volatility ruling the roost in the stock markets, equity NFOs are conspicuous by their absence in the March 2013 NFONEST.

BNP Paribas Government Securities Fund

Opens: April 18, 2013

Closes: April 29, 2013

BNP Paribas Mutual Fund has launched the BNP Paribas Government Securities Fund, an open ended long-term gilt fund. The objective of the fund is to seek to generate income and capital appreciation by predominantly investing in a portfolio of government securities of various maturities. The fund shall invest its entire corpus in Government Securities issued by Central / State government, Treasury Bills, Reverse repos in Government Securities, and CBLO. The cumulative gross exposure through government securities, treasury bills, and derivatives will not exceed 100% of the net assets of the fund. The fund's performance will be benchmarked against I Sec Composite Gilt Index. The fund will be managed by Puneet Pal.

BNP Paribas Capital Protection Oriented Fund–Series I (38M)

Opens: April 16, 2013

Closes: April 30, 2013

BNP Paribas Mutual Fund has unveiled a new fund named as BNP Paribas Capital Protection Oriented Fund - Series 1, a close-ended capital protection oriented fund. The tenure of the fund is 38 months. The fund has been rated AAA m fs (SO) by CARE. The investment objective of the fund is to seek capital protection by investing in fixed income securities maturing on or before the maturity of the fund and seeking capital appreciation by investing in premium of exchange traded options. The fund will allocate 80% to 100% of assets in debt securities including money market securities with low to medium risk profile. On the flipside, it would allocate up to 20% of assets in option premium with high risk profile. Of the investments in debt instruments, 95% to 100% of assets would be invested in AAA rated non-convertible debentures, up to 5% in certificate of deposits and up to 5% in commercial papers. The fund's performance will be benchmarked against Crisil MIP Blended Index. Debt portion of the fund will be managed by Puneet Pal, and equity portion will be managed by Shreyash Devalkar.

ICICI Prudential Multiple Yield Fund – Series 3 – Plan B

Opens: April 16, 2013

Closes: April 30, 2013

ICICI Prudential Mutual Fund has launched a new fund named as ICICI Prudential Multiple Yield Fund - Series 3 - Plan B, a close ended income fund. The tenure of the plan is 1100 days. The primary objective of the fund is to seek to generate returns by investing in a portfolio of fixed income securities/ debt instruments. The secondary objective of the fund is to generate long term capital appreciation by investing a portion of the fund's assets in equity and equity related instruments. The fund will allocate 65% to 90% of assets in short term and medium term debt securities / debt instruments and securitized debt with low to medium risk profile. It would allocate up to 10% of assets in money market instruments with low to medium risk profile. On the flip side, it would allocate 10% to 35% of the asset in equity or equity related securities with medium to high risk profile. Of the investments in debt instruments, 70% to 75% would be invested in non-convertible debentures and up to 5% in A1 rated certificate of deposits. The benchmark index for the fund will be Crisil MIP Blended Index. Rahul Goswami, will manage the debt portion of investments under the fund. The equity portion will be managed by Rajat Chandak. The investments under the ADRs/GDRs and other foreign securities will be managed by Atul Patel.

Mirae Balanced Fund, Mirae ETF, Canara Robeco Agribusiness Fund, Pramerica Diversified Equity Fund, HDFC Corporate Debt Opportunities Fund, Motilal Oswal MOSt Shares CNX 100 Equal weight ETF (MOSt Shares C100), BNP Paribas Russia Fund, Religare Corporate Bond Opportunities Fund, Axis Small Cap Fund, HDFC Capital Protection Oriented Fund Series - 1 (Plan 3), and Quantum Dynamic Bond Fund are expected to be launched in the coming months.