NFO NEST

December 2015

NFOs hit speed bump

NFOs seem to be moving in a low gear as fund houses have launched only 340 new schemes in April-September of 2015 following SEBI's direction to rationalise and consolidate offerings with similar goals. In comparison, mutual funds had come out with 1,059 NFOs for the whole of 2014-15. The numbers stood at 1,023 and 1,168 in 2013-14 and 2012-13, respectively. Over the past few years, there has been a declining trend in the issuance of NFOs. This trend has been partly due to the regulator's direction to rationalise and consolidate mutual fund schemes with similar objectives, according to a report titled 'Indian Mutual Fund Industry- The Road Ahead' from ASSOCHAM. The requirement from the regulator to demonstrate the differentiation in investment style and attributes of a potential new fund has also impacted the pace of approvals. Furthermore, the requirement of disclosing details and number of funds managed by each fund manager has also led to more circumspection. Most of the new schemes launched in April-September have been aimed at investment in equity and equity-related securities. Besides, the products have been focused on diversified funds, exchange-traded funds, tax-saving instruments, and arbitrage schemes. Overall, a total of 120 draft documents have been filed with capital markets regulator SEBI to roll out new NFOs in the current fiscal so far.

Close-ended NFOs adorn the December 2015 NFONEST.

SBI Debt Fund Series B - 29

Opens: December 17, 2015

Closes: December 21, 2015

SBI Mutual Fund has unveiled a new fund named as SBI Debt Fund Series B - 29, a close ended debt fund. The tenure of the fund is 1200 days from the date of allotment. The investment objective of the fund is to provide regular income, liquidity, and returns to the investors through investments in a portfolio comprising of debt instruments such as Government Securities, PSU & Corporate Bonds, and Money Market Instruments maturing on or before the maturity of the fund. The fund will invest 70%-100% of assets in debt and invest up to 30% of assets in money market securities with low to medium risk profile. Exposure to domestic securitized debt may be to the extent of 40% of the net assets. Benchmark Index for the fund is CRISIL Composite Bond Fund Index. The fund manager is Rajeev Radhakrishnan.

ICICI Prudential Capital Protection Oriented Fund Series IX Plan C

Opens: December 8, 2015

Closes: December 22, 2015

ICICI Prudential Mutual Fund has launched a new fund named as ICICI Prudential Capital Protection Oriented Fund - Series IX - 1195 Days Plan C, a close ended capital protection oriented fund. The tenure of the fund is 1195 days. The investment objective of the fund is to seek to protect capital by investing a portion of the portfolio in highest rated debt securities and money market instruments and also provide capital appreciation by investing the balance in equity and equity related securities. The securities would mature on or before the maturity of the plan under the fund. The fund would allocate 70%-100% of assets in debt securities and money market instruments with low to medium risk profile and invest up to 30% of assets in equity and equity related securities with medium to high risk profile. The performance of the fund will be benchmarked against CRISIL Composite Bond Fund Index (85%) and CNX Nifty (15%). The fund managers are Vinay Sharma (equity portion), Chandni Gupta & Rahul Goswami (debt portion) and Shalya Shah (For investments in ADR / GDR and other foreign securities).

Sundaram Long Term Tax Advantage Fund Series II

Opens: November 3, 2015

Closes: March 15, 2016

Sundaram Mutual Fund has launched a new fund named as Sundaram Long Term Tax Advantage Fund -Series II, a 10 year close ended equity linked savings scheme. The duration of the fund is 10 years from the date of allotment of units. The investment objective of the fund is to generate capital appreciation over a period of ten years by investing predominantly in equity and equity-related instruments of companies along with income tax benefit. The fund will allocate 80%-100% of assets in equity and equity related securities with high risk profile and invest up to 20% of assets in fixed income and money market securities with low to medium risk profile. The fund's performance will be benchmarked against S&P BSE 500 Index. The fund will be managed by S. Krishnakumar & Dwjendra Srivastava.

UTI Long Term Tax Advantage Fund Series III

Opens: December 18, 2015

Closes: March 30, 2016

UTI Mutual Fund has launched a 10 year close-ended equity linked savings scheme as “UTI-Long Term Advantage Fund-Series III”. The investment objective of the fund is to generate capital appreciation over a period of ten years by investing predominantly in equity and equity-related instruments of companies along with income tax benefit. The fund will be benchmarked against S&P BSE 100 Index. This is an ideal plan for long term wealth creation and tax-saving under section 80C of Income Tax up to a deposit amount of Rs. 1,50,000/-. Besides this, as per the present tax laws there are no tax on long term capital gain too. It is a tax saving scheme and a wealth creator too for the investor. 1^st series of UTI – Long term Advantage fund was launched in 2007 & the 2^nd series in the year 2008 and both have done a fair job in wealth creation as well as tax–savings for the investors.

IDFC money Market Fund, ICICI Prudential CPSE ETF, Reliance Children Fund, Canara Robeco Equity Opportunities Series 1 and 2, IDFC Sensex ETF, IDFC Nifty ETF, and SBI Children Benefit Fund – Investment Plan are expected to be launched in the coming months.