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Thursday, November 12, 2009

Religare PSU Equity Fund mops up Rs.229 crore

Investment will be in fundamentally sound companies having the potential to deliver superior growth in the long term. 

Religare Mutual Fund has collected Rs 229 crore through Religare PSU Equity Fund, an open ended equity scheme, during its initial offer period from 29 September to 28 October 2009. The Religare PSU Equity Fund will reopen for ongoing sale and repurchase (not later than) on 27 November 2009.

The investment objective of the scheme is to seek to generate capital appreciation by investing in companies where the Central / State Government (s) has majority shareholding or where the management control lies with the Government. The fund aims to select fundamentally sound companies having the potential to deliver superior growth in the long term.

Speaking on the occasion, Saurabh Nanavati, Chief Executive Officer, Religare Mutual Fund said, “The period August – October 2009 has actually seen equity outflows from the industry - both from a transaction perspective as well as AUM of over Rs. 3,900 crore moving out ( as per AMFI data). This can be attributed to Profit-booking by investors based on advice from their distributor and slowdown in fresh collections due to the distributor undergoing a change in his business model of charging advisory fees”.

In the backdrop of this tough environment for equity collections, the fund has collected over Rs.229 crore, with close to 37,000 applications (including 7,000 SIP applications), coming in from over 170 cities and towns across the country.

The scheme will invest 65-100% in equity & equity related instruments of the constituents of BSE PSU Index with high risk profile. The fund will be having investment exposure up to 35% in equity & equity related instruments of PSU companies other than the constituents of the BSE PSU Index with high risk profile.

Investment in equity & equity related instruments of non PSU companies will be up to 20% with high risk. The scheme will invest up to 35% in debt & money market instruments with low to medium risk profile.

Non PSU companies are considered as companies which are PSU at the time of investment and which may subsequently become non PSU because of privatization or disinvestment. Investment in securitized debt including pass through certificate (PTC) shall not exceed 20% of the net assets of the Scheme. The scheme will not invest in foreign securitized debt.

The scheme offers three options viz. dividend and growth options. The dividend option will carry both payout and reinvestment facility.

The fund manager for the scheme is Pradeep Kumar.
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