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Monday, April 13, 2009

UTI-Capital Plus Fund seeks for Sebi's approval

Investment exposure will be in fixed income securities

UTI Mutual Fund has filed offer document with Securities and Exchange Board of India (Sebi) to launch UTI-Capital Plus Fund. The face value of the new issue will be Rs 10 per unit.

Features of the scheme:

It is close-ended income oriented fund comprising two plans with specific maturity date. 3 year plan with a duration of 3 years from the date of allotment and 5 year plan with a duration of 5 years from the date of allotment.

The investment objective of the fund is to endeavor to protect the capital by investing in high quality fixed income securities as the primary objective and generate capital appreciation by investing in equity and equity related instruments as secondary objective.

Investment options: The scheme offers two plans viz. retail and institutional plan with growth and dividend option. Dividend sub option will have payout facility.

Minimum application amount: The minimum investment amount under retail plan will be Rs 5000 and in multiples of Re 1 thereafter and under institutional plan will be Rs 1 crore and in multiples of Re 1 thereafter.

The scheme seeks to collect a minimum corpus of Rs 10 crore during NFO period.

Asset allocation: Under both 3 and 5 year plan, the scheme will invest 65-100% in debt & money market instruments including securitised debt with low to medium risk. It will have investment up to 35% in equity & equity related instruments with medium to high risk profile. Investment in securitised debt shall be up to100% of the debt portfolio.

The scheme shall invest only in such securities, which mature on or before the date of the maturity of the scheme. The scheme will invest in a portfolio predominantly of fixed income securities that are maturing in line with duration of the respective Plans. Each Plan will have a separate portfolio. The Scheme will follow a passive investment strategy for the fixed income component of the scheme.

While no fixed allocation will normally be made for investment in money market instruments like Call Deposits, Commercial Papers, Treasury Bills etc. the same may be kept to the minimum generally to meet the liquidity needs of the scheme.

The scheme will initially deploy at least 65% of the funds collected in the respective plan during the New Fund Offer in debt fixed income securities with an intention to protect the principal at the time of maturity of the respective plans.

Load structure:

Retail Plan: The scheme will levy an entry load of 1.00%. While no exit load will be charged.

Institutional Plan: There will be no entry load and exit load.

Benchmark index: The performance of the scheme is being benchmarked to the performance of CRISIL MIP Blended Index.

Fund Manager: Harsha Upadhyaya will be fund manager for the scheme.

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