Irda Tightens Policy Switch Norms

Seeking to safeguard interest of customers, Irda has made it mandatory for agents to provide full details in transparent manner before persuading policyholders to shift to another life insurance firm.Tightening of replacement norms would help in retaining the life insurance policy.

The guidelines envisage the full disclosure and transparent information to the policyholder to avoid a possible misrepresentation as to the factual position of financial consequences of replacing an existing life insurance policy, it said. The draft said, “no life insurance agent, insurance intermediary or an insurer is permitted to replace a life insurance policy, except, if it is in the interest of the policyholder.”

Every insurance intermediary would make every reasonable effort to keep in force the existing life insurance policy, it said. Replacement, if required, would be subject to certain conditions, including obtaining a written consent from the prospect for replacing existing policies.

Replacing your life insurance policy might get tougher

If Irda’s guidelines are implemented, cases of surrendering policies and making these paid-up might decline
Often, insurance policyholders are misled into replacing their policies with new ones, with promises of lower premia or better returns. Though the process wasn’t difficult so far, this might change soon. The Insurance Regulatory and Development Authority (Irda) has issued draft guidelines on replacement of life insurance policies. Now, an agent should secure the written consent of the policyholder, inform the existing insurer 15 days before submitting new proposal forms, and send the forms to the new company only after this 15-day period. In their policy documents, insurance companies must advise customers not to surrender, lapse or make paid-up existing policies before taking on a new one.

They should also advise customers not to withhold full or part amount of the surrender value payable, and inform the new company of a customer’s existing policies. P Nandagopal, managing director and chief executive, India First Life Insurance, says there could be various reasons to replace a life insurance policy. For instance, in case of a term policy, as the premium rates for new policies are lower, there might be a case to replace the existing policy with a new one. Or, for a savings-linked policy such as an endowment plan, if the need for which the policy was purchased has changed, some might want a new policy.

While Irda’s move is a step in the right direction, it could put additional burden of documentation on insurers and raise administrative costs, Nandagopal says. However, S Sridharan, head of financial planning and advisory, FundsIndia.com, says it will mean only an additional column in the policy document. “Now, Irda is putting more responsibility on companies and agents to ensure there is no mis-selling. According to the guidelines, before selling a policy, an agent has to mention whether it is a replacement or a new one. And, the insurance company has to personally verify this with the customer,” he says. Even if the customer is convinced a policy has to be replaced, he has to now undergo a through process and it is expected this will reduce cases of surrendering policies and converting these into paid-up ones, he adds. Deepak Mittal, managing director and chief executive, Edelweiss Tokio Life Insurance, says currently, an insurance company knows if an existing policy is being replaced only if the policies are from the same company.

But once the new guidelines come into force, “it will be tougher for agents to pitch a new policy to replace a lapsed one because of disclosures. But the flow of information has to be smooth”. Subrat Mohanty, head (strategy and products), HDFC Life, says, “Now, the customer will be advised that continuing with the old policy is better for him and if he decides to go ahead, he will be given time to reconsider his decision.”

Sebi announces change in Minimum AUM of Debt Oriented Schemes

Minimum subscription at the time of NFO shall be at least Rs 20 crore 

Sebi has announced that the minimum subscription amount of debt oriented and balanced schemes at the time of new fund offer (NFO) shall be at least Rs 20 crore and that of other schemes shall be at least Rs 10 crore. 

The market regulator said that it has been observed that many debt oriented schemes are operating with a very low AUM. In the interest of investors, it is important that debt oriented schemes have an adequate corpus to ensure adherence to the investment objectives as stated in Scheme Information Document and compliance with investment restrictions specified under Sebi (Mutual Funds) Regulations, 1996. 

Sebi said, an average AUM of Rs 20 crore on half yearly rolling basis shall be maintained for open ended debt oriented schemes. The existing open ended debt oriented schemes shall comply with point (b) stated above within one year from the date of issue of this circular. In case of breach of points above, the AMC shall scale up the AUM of such scheme within a period of six months so as to comply with point (b) stated above, failing which the provisions of Regulation 39 (2) (c) of SEBI (Mutual Funds) Regulations, 1996 would become applicable. 

The confirmation on compliance of the above shall be reported to SEBI in the Half Yearly Trustee Reports.

Birla Sun Life MF Announces Dividend Under Its Schemes

Record date for dividend is 27 June 2014

Birla Sun Life Mutual Fund has announced 27 June 2014 as the record date for declaration of dividend on the face value of Rs 10 per unit under the dividend option of following schemes. The amount of dividend (Rs per unit) will be: 

Birla Sun Life Infrastructure Fund – Regular Plan: 1.75 

Birla Sun Life Top 100 Fund – Regular Plan: 0.85 

Birla Sun Life India Gen Next Fund- Regular Plan & Direct Plan: 2.00 each. 

Birla Sun Life Dividend Yield Plus – Regular Plan: 0.80

Reliance Tax Saver (ELSS) Fund Announces Dividend

Record date for dividend is 27 June 2014

Reliance Mutual Fund has announced 27 June 2014 as the record date for declaration of dividend on the face value of Rs 10 per unit under Dividend Plan-Dividend Option and Dividend Plan-Dividend Payout Option of Reliance Tax Saver (ELSS) Fund. The amount of dividend will be Rs 0.36 per unit under each option.

Axis Fixed Term Plan Series 68 (645 Days) Floats On

NFO period is from 23 June to 27 June 2014 

Axis Mutual Fund has launched a new plan named as Axis Fixed Term Plan – Series 68 (645 Days), a close ended debt scheme. The duration of the scheme is 645 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 23 June to 27 June 2014. 

The plan of the scheme will endeavour to generate returns through a portfolio of debt & money market instruments that are maturing on or before the maturity of the plan. 

The scheme would have two plans - regular and direct. Both the plans will have growth option, dividend (payout facility) option and Quarterly dividend (Payout facility) option. 

The scheme will allocate 70%-100% of assets in debt instruments including Certificate of Deposits with low to medium risk and will invest upto 30% of assets in money market instruments with low risk profile. Investment in securitized debt would be upto 50% of the net assets of the scheme. The scheme shall not invest in foreign securitized debt. Investment in derivatives shall be up to 50% of the net assets of the scheme. 

65% to 70% of net assets would be invested in AAA rated NCDs/Bonds. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be not applicable. 

Benchmark index for the scheme is CRISIL Short Term Bond Fund Index. 

The fund manager of the scheme will be Kedar Karnik.

LIC Nomura MF Capital Protection Oriented Fund Series 4 Floats On

NFO period is from 23 June to 07 July 2014 

LIC Nomura Mutual Fund has launched a new fund named as LIC Nomura MF Capital Protection Oriented Fund Series 4, a close ended capital protection oriented scheme with the duration of 38 months. The new fund offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 23 June to 07 July 2014. 

The investment objective of the scheme is to achieve capital protection by investing in fixed income securities maturing on or before the tenure of the scheme and seeks capital appreciation by investing in equity and equity related instruments. 

The scheme offers two options viz. growth and dividend payout option. 

The scheme would allocate 80%-100% of assets in debt securities and money market instruments with low to medium risk profile and invest upto 20% of the asset would be invested in options premium, equity & equity related instruments with high risk profile. 

The minimum application amount is Rs 5000 and in multiple of Re.1 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry load and exit load charged will be Nil for the scheme. 

Benchmark index for the scheme is CRISIL MIP Blended Index. 

The fund managers of the scheme are Killol Pandya (debt portion) and Sachin Relekar (equity portion).

Reliance Fixed Horizon Fund – XXVI – Series 32 Floats On

NFO period is from 20 June to 27 June 2014

Reliance Mutual Fund has launched a new fund named as Reliance Fixed Horizon Fund – XXVI – Series 32, a close ended income scheme with the duration of 1094 days from the date of allotment. During the New Fund Offer (NFO) the scheme will offer units at Rs 10 per unit. The new issue will be open for subscription from 20 June to 27 June 2014. 

This product is suitable for investors seeking returns and growth over the term of the fund limiting interest rate volatality by investment in debt, money market and G-sec instruments maturing on or before the date of maturity of the scheme with low risk - Blue. 

The primary investment objective of the scheme is to generate returns and growth of capital by investing in a diversified portfolio of Central, State Government securities and other fixed income/ debt securities maturing on or before the date of maturity of the scheme with the objective of limiting interest rate volatility. 

The scheme offers two options viz. growth, dividend payout option and direct plan – growth option and direct plan – dividend payout option. 

The scheme will allocate upto 30% of assets in money market instruments with low risk profile and invest 70%-100% of assets in government securities & debt instruments with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Re. 1 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

Benchmark Index for the scheme is CRISIL Short Term Bond Fund Index. 

The fund manager of the scheme will be Amit Tripathi.

Tata Fixed Maturity Plan Series 48 Scheme D (368 Days) Floats On

NFO period is from 23 June to 02 July 2014 

Tata Mutual Fund has launched a new fund named as Tata Fixed Maturity Plan Series 48 Scheme D, a close-ended debt scheme with the duration of 368 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs. 10 per unit. The new issue will be open for subscription from 23 June and close on 02 July 2014. 

The investment objective of the scheme is to generate income and / or capital appreciation by investing in wide range of fixed income instruments having maturity in line with the maturity of a scheme. 

The scheme offers growth option and periodic dividend option (payout). 

The scheme shall invest upto 100% of assets in debt and money market instruments with low to medium risk profile. 

The minimum application amount is Rs 5000 and multiples of Re 1 thereafter. 

The fund seeks to collect a minimum subscription amount of Rs 20 crore under the scheme during the NFO period. 

Entry load: Not applicable. 

Exit load: Nil. 

Benchmark Index for the scheme is Crisil Short Term Bond Fund Index 

The fund manager for the scheme will be Amit Somani.

HDFC CPO-II-36M June 2014 Extends NFO period

NFO will now close on 25 June 2014 

HDFC Mutual Fund has announced that the closing date of the New Fund Offer (NFO) period of HDFC CPO-II-36M June 2014, a plan under HDFC Capital Protection Oriented Fund - Series II (a close-ended capital protection oriented income scheme) has been extended from 24 June to 25 June 2014.

HDFC Corporate Debt Opportunities Fund Announces Change In Exit Load Structure

With effect from 01 July 2014 

HDFC Mutual Fund has announced change in exit load structure under HDFC Corporate Debt Opportunities Fund, an open ended income scheme with effect from 01 July 2014.
Accordingly, in respect of each purchase / switch-in of units, an exit load of 2% is payable if units are redeemed / switched-out within 12 months from the date of allotment. 

In respect of each purchase / switch-in of units, an exit load of 1% is payable if units are redeemed / switched-out after 12 months but within 24 months from the date of allotment. 

No exit load is payable if units are redeemed / switched-out after 24 months from the date of allotment.

HDFC FMP 371D June 2014 (3) Floats On

NFO period is from 26 June to 30 June 2014 

HDFC Mutual Fund has launched a new plan named as HDFC Fixed Maturity Plan 371D June 2014 (3), a plan under HDFC Fixed Maturity Plans – Series 31 (a close-ended income scheme). The face value of the new issue will be Rs 10 per unit. The new issue will be open for subscription from 26 June to 30 June 2014. 

The investment objective of the plan is to generate regular income through investments in debt / money market instruments and government securities maturing on or before the maturity date of the plan. 

The plan shall offer three options – growth, dividend and flexi option. 

The plan would invest upto 100% of assets in debt instruments, money market instruments and government securities with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. 

Entry and exit load charge will be nil for the plan. 

Benchmark Index for the plan is CRISIL Short Term Bond Fund Index. 

The fund managers of the scheme are Shobhit Mehrotra & Rakesh Vyas (Dedicated fund manager for overseas investments).

HDFC Fixed Maturity Plan 750D June 2014 (1) Floats On

NFO period is from 26 June to 08 July 2014 

HDFC Mutual Fund has launched a new plan named as HDFC Fixed Maturity Plan 750D June 2014 (1), a plan under HDFC Fixed Maturity Plans – Series 31 (a close-ended income scheme). The face value of the new issue will be Rs 10 per unit. The new issue will be open for subscription from 26 June to 08 July 2014. 

The investment objective of the plan is to generate regular income through investments in debt / money market instruments and government securities maturing on or before the maturity date of the plan. 

The plan shall offer three options – growth, dividend and flexi option. 

The plan would invest 70%-100% of assets in debt instruments and government securities with medium risk profile and invest upto 30% of assets in money market instruments with low risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. The
fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the plan during the NFO period. 

Entry and exit load charge will be nil for the plan. 

Benchmark Index for the plan is CRISIL Short Term Bond Fund Index. 

The fund managers of the scheme are Shobhit Mehrotra & Rakesh Vyas (Dedicated fund manager for overseas investments).

SBI Debt Fund Series A – 35 Floats On

NFO period is from 30 June to 02 July 2014 

SBI Mutual Fund has unveiled a new fund named as SBI Debt Fund Series A – 35, a close ended debt scheme. The tenure of the scheme is 369 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 30 June and close on 02 July 2014. 

The investment objective of the scheme 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 scheme. 

The scheme offers regular and direct plan. Both the plans will have growth and dividend option. 

The scheme will invest upto 100% of assets in debt and 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. 

The minimum application amount is Rs 5000 and in multiples of Rs 1 thereafter. 

Entry and exit load charge will be nil for the scheme. 

The units of the scheme will be listed on NSE in order to provide liquidity. 

Benchmark Index for the scheme is CRISIL Liquid Fund Index. 

The scheme will be managed by Rajeev Radhakrishnan.

Franklin Templeton MF Announces Merger of Two Schemes

With effect from 08 August 2014 

Franklin Templeton Mutual Fund has announced that with effect from 08 August 2014, Templeton India Children's Asset Plan – Gift Plan would be merged into FT India Balanced Fund and Templeton India Children's Asset Plan – Education Plan would be merged into FT India Monthly Income Plan. 

The investors are given an option to exit at the prevailing NAV without any exit load from 09 July 2014 to 07 August 2014.

Franklin Templeton MF Extends Merger Date

Extends till 25 July 2014

Franklin Templeton Mutual Fund has announced the date of merger of Templeton India Government Securities Fund-Treasury Plan (TGSF-TP) into Templeton India Government Securities Fund-Composite Plan (TGSF-CP) has been extended from 18 July 2014 to 25 July 2014.

Fiscal consolidation is critical for lowering India's debt-to-GDP ratio-Crisil Research

In fiscal correction quest, the best bet's GST 

The BJP-led National Democratic Alliance won the 2014 election on two planks – reviving growth and lowering inflation. To achieve both simultaneously, the new government will have to boost expenditure in growth-critical areas such as infrastructure, and reduce unproductive spending such as subsidies. In other words, there is scope for expenditure switching but there is little room to lower overall expenditure. That being the case, to sustainably reduce fiscal deficit from current levels, the government will have to rely on raising revenues as a share of GDP. 

To raise tax rates at this juncture is not prudent because it will severely hurt growth. Instead, the government has to implement structural tax reforms such as the goods and services tax (GST), which will lift tax revenues, lower the cost of doing business and boost growth. 

How GST helps 

The impact of GST on tax revenues will be two-fold. By eliminating the cascading effect of multiple central and state taxes, GST will reduce the cost of doing business and increase profitability, which, in turn, will attract investments and ultimately help GDP growth. Lower taxation and filing costs will also improve the price competitiveness of Indian goods abroad, boosting exports. Second, by simplifying the tax regime, GST can significantly improve tax compliance and increase tax revenues. 

Fiscal deficit will remain high 

However, implementation of GST in this financial year is unlikely. Therefore, we forecast fiscal deficit to stay high at 4.3% of GDP in the current year. That too, after assuming higher non-tax revenues and a significant increase in disinvestments as compared to last fiscal. This is because, sans GST, upside to tax revenues will be limited. Yet the government will have to accommodate large rollover of subsidies from the last fiscal – estimated at Rs 650 billion or 25% of the recognised subsidies in fiscal 2014 – as well as raise capital expenditure or spend productively to bolster growth. 

If monsoons are below normal, GDP growth could slip to 5.5% in fiscal 2015 instead of our base case forecast of 6.0%. However, we do not expect this to materially change our forecast for fiscal deficit, as lower agriculture growth is unlikely to have a significant impact on tax collections. We also believe that any increase in expenditures due to relief packages etc will be rationalised with cutbacks or savings in spending elsewhere. 

Partial GST rollout most likely 

In the next financial year, GST implementation will facilitate a much-needed correction in the fiscal deficit. But despite its myriad advantages, we do not foresee a full-scale implementation of GST in its current form. Instead, we believe, the most likely outcome is a partial rollout of GST - one that excludes petroleum goods - given its large impact on state revenues. Even so, fiscal deficit is forecast to correct to 3.3% of GDP by 2017. On the downside, a failure to implement GST will crank up the fiscal deficit to 4-4.2% in 2016 and 2017. 

Fiscal consolidation key for lowering India's debt ratio 

Fiscal consolidation is also critical for lowering India's debt-to-GDP ratio. Central government's internal debt has stabilised at 48% of GDP in the last two years after declining steadily since fiscal 2005, when it peaked at 60% of GDP. Including external liabilities, the centre's debt burden is higher at 51% of GDP and the debt burden of centre+ states is even higher at 65% of GDP! 

Furthermore, the declining trend of the centre's debt ratio post fiscal 2009 has been driven more by high inflation rather than lower fiscal deficit or faster GDP growth – as is desirable. Had inflation not risen so sharply, the central government's internal liabilities-to-GDP ratio would have started rising by now and stood at 55% in fiscal 2014 instead of 48%. 

Going ahead, with inflation expected to moderate and upside to growth limited, a strong commitment to fiscal consolidation is an imperative to lower India's debt-to-GDP ratio. With a partial GST implementation, we forecast that India's debt-to-GDP ratio (internal liabilities as a % of GDP) will decline to 45% by fiscal 2017. 

The task of fiscal consolidation for this government will not be easy. There is very little scope to cut overall expenditure, as it has already been trimmed sharply in the last two years. The government must instead focus on switching expenditure from unproductive subsidies toward spending on sectors such as health, education and infrastructure. The only way to reduce fiscal deficit, therefore, is to raise revenues as a share of GDP. To do so, the government must implement structural tax reforms such as GST, improve tax compliance and widen the tax coverage. 

The scope to lower fiscal deficit in fiscal 2015 is limited given large roll-over of subsidies from last fiscal and little possibility of implementation of GST within this year. Beyond that, however, implementation of GST could facilitate a much needed correction in fiscal deficit. In the base case, we believe that partial GST - one that excludes petroleum goods - is most likely. Even with this, fiscal deficit could correct to 3.3% of GDP by fiscal 2017. On the downside, a complete failure to implement GST would result in the fiscal deficit being higher at around 4-4.2% in fiscals 2016-2017. 

Fiscal consolidation is also critical for lowering India's debt-to-GDP ratio, which has stabilised in the last two years, after declining steadily since fiscal 2005. From fiscal 2009, however, high inflation has been the primary driver of India's declining debt-to-GDP ratio. Had inflation not risen so sharply, India's debt ratio would have started rising by now. Going ahead, as inflation is expected to moderate and the upside to growth will be limited, a strong commitment to fiscal consolidation will be key to lowering India's debt-to-GDP ratio.

Robust Global Demand to Keep LNG Prices High-QNB Group

Robust global demand is likely to keep LNG prices high over the next few years. 

Demand is growing both as a result of strong Asian economic growth and the switch to cleaner energy, particularly in China. This trend is likely to continue, notwithstanding the so-called US shale gas revolution and the coming into operations of the USD400bn Russia-China gas pipeline signed on May 21, 2014. Overall, the future of the LNG market remains bright and is likely to result in high LNG prices for years to come. This will continue to support Qatar's large current account surpluses, said QNB Group report. 

The report stated that the outlook for the LNG market is likely to continue on the 2013 trends in 2014. On the supply side, three new LNG trains in Algeria, Australia and Papua New Guinea are expected to come on-stream in 2014. This is likely to add about 10m tons to global LNG production--a 4.2% increase. On the demand side, continued growth in Asian demand and the need for Europe to diversify away from Russian pipeline gas may outpace the increased supply, leading to a small increase in LNG prices of about USD0.5 per mBtu despite the expected decline in Brent crude oil prices. The ongoing violence in Iraq and Syria could, however, result in higher-than-expected LNG and crude oil prices in the second half of 2014. 

The LNG market continued to tighten in 2013. Global LNG deliveries were an estimated 240m tons--broadly flat compared with 2012. Qatar continued to be the largest LNG exporter, with about one third of global supply. At the same time, demand from Asia and Latin America rose, with China, South Korea and Mexico registering the largest increase in LNG demand. In particular, China brought three new re-gasification terminals online as its switch from coal to LNG as a cleaner fuel for electricity production continued. This tightening of the market resulted in an average USD1 increase in LNG prices per million British thermal units (mBtu), despite Brent crude oil prices falling USD4.5 per barrel and lower LNG demand from Europe. 

Over the medium term, global LNG exports are unlikely to meet the growing global demand, leading to higher LNG prices. On the supply side, the gradual ramp up in production in Australia (60m tons over the next six years) and Papua New Guinea (7m later this decade) is likely to result in global LNG exports reaching 300m tons by 2020--a 3.8% compound annual growth rate. Additional exports are unlikely to materialize before then. In particular, the so-called shale-gas revolution in the United States is not expected to materialize in additional LNG exports before 2020 as this would imply a convergence of US domestic gas prices (Henry Hub) to international LNG prices, something current and future US administrations are likely to resist (see our Economic Commentary dated November 28, 2013). Moreover, the recently-signed agreement for Russia to provide 38bn cubic feet a year of pipeline gas over the next 30 years to China is likely to imply a displacement of gas supplies from Europe to Asia, thus pushing up prices in Europe while reducing prices in Asia. While this is likely to bring about convergence in global LNG prices, it will not change the aggregate global gas supply. 

On the demand side, two factors are likely to make global demand continue to outpace global supply. First, energy demand in Asia is expected to remain robust, even after taking into account a slowdown in Chinese growth. Countries like China, India, Indonesia, Malaysia, Pakistan and Thailand have just started to rely on LNG supplies for their energy needs and this trend is likely to grow over the next few years. Second, China's rising pollution will mandate a switch away from coal to cleaner energy sources, particularly LNG and pipeline gas. These two factors are expected to lead to global LNG demand growing steadily by 5-7% a year up to 2020, thus outpacing global supply. 

Overall, robust LNG demand is likely to outpace global supply up to 2020. This is likely to imply higher LNG prices as demand from Asia remains robust. As the largest exporter in the world, Qatar is likely to benefit from higher LNG prices, resulting in large current account surpluses for years to come.

Government extends prohibition on import of milk and milk products from China by one year

Till 23 June 2015 or until further orders, whichever is earlier 

The Government of India has issued notification extending the prohibition on import of milk and milk products (including chocolates and chocolate products and candies/ confectionary/ food preparations with milk or milk solids as an ingredient) from China by one more year, i.e., till 23 June 2015 or until further orders, whichever is earlier.

ASSOCHAM submits multipronged strategy to the Centre to mobilize resources for urban development

To mobilize the resources to the extent of Rs.70 Lakh Cr by 2030 as an aggregate capital investment mainly for urban roads, affordable housing and transportation, ASSOCHAM has submitted a 10-point strategy to the government including incentivisation of REITs and Urban Development Funds (UDFs). 

In a meeting with the Urban Development Minister Mr. M. Venkaiah Naidu the ASSOCHAM 12-member delegation led by its Past President Mr. Anil K Agarwal said that urban cities are the growth catalysts and likely to create 70% of net new jobs and contribute over 70% to India's GDP in another 16 years. The delegation stated that India will have six mega cities with 10 million population entailing annual per capita investment on urban services to Rs. 8000 as against the current investment of Rs. 1000. 

Mumbai and Delhi, according to the study undertaken by ASSOCHAM, will be among the five largest cities in the world and, in addition, cities with over one million population will increase from 53 to 68. The urban population is expected to touch 590 million accommodating approximately 40% of total population. This will create critical gaps in healthcare, education clean drinking water, sanitation, affordable housing and public transportation. 

The chamber has suggested development of basic infrastructure like public transport, flyovers, drainage, sanitation and waste management, incentivization of REITs and Urban Development Funds to invest in public utility services like slum rehabilitation, water supply, waste management, sanitation and deepening of e-governance mechanisms for electronic delivery of public services. 

It has further proposed to establish regulatory authority to monitor work of Urban Local Bodies (ULBs) – build capacity in research, planning, HRD - facilitated by States, strengthening of fiscal standing of ULBs through improved revenue collection, expense management, budgetary allocations and developing Municipal Bond Markets by providing suitable tax incentives to investors 

Rehabilitation of slums and creation of affordable housing inventory with rental housing facilities for various income groups at city outskirts and improvement in quality of life in Tier 1 and Tier 2 cities by maintaining and developing recreation facilities and public parks needs to be prioritized. 

Other issues include development of green-field integrated smart cities along industrial corridors such as DMIC, upgradation of civic amenities, health services, urban transport and inter-city connectivity for Tier II cities, innovation in public transport through intelligent transportation systems incorporating vehicle telematics to reduce commuting time and integration of Disaster Management Systems and a comprehensive Risk Management Framework into Urban Planning, with periodic audits. 

Mr. Agarwal said development of suitable framework for people public private partnership (PPPP) in urban infrastructure projects to enhance efficiency in delivery of urban services and effective use Indian Railways' urban land banks to set up Central business districts with facilities for holding conventions and exhibitions, transportation hubs, affordable housing and shopping centres are must.

Fund raising via preferential allotment dips 59.8% in January-April 2014

Total numbers of preferential issues were higher at 137 in January-April 2014

Fund raising of listed companies via preferential allotment of shares to promoters and shareholders has declined 59.8% to Rs 7073 crore in January-April 2014, compared to Rs 17612 crore in January-April 2013. 

However, the total numbers of preferential issues were higher at 137 in January-April 2014, as against 122 in January-April 2013. 

On preferential basis, the companies raised Rs 809 crore in January 2014, Rs 686 crore in February 2014, Rs 2418 crore in March 2014 and Rs 3160 crore in April 2014. 

The SEBI board at its meeting in the last week has decided to replace 'closing price' with 'volume weighted average price' in the pricing formula for preferential issues. Further, SEBI board also extended the regulations concerning pricing of QIPs that take into account the effect of stock split, bonus, etc and regulations specifying the pricing methodology in case of infrequently traded shares to preferential issues. 

The revised change to preferential allotment norms is expected to prop up the issue of shares on preferential basis.

RBI allows banks to appoint non-deposit taking NBFCs as business correspondents

Banks have to ensure that there is no comingling of bank funds and those of the NBFC-ND appointed as BC 

Taking into account the recommendations of the Mor Committee, the existing guidelines on appointment of Business Correspondents (BCs) have been reviewed allowing banks to appoint non-deposit taking NBFCs (NBFCs-ND) as BCs. However, the banks have to ensure that there is no comingling of bank funds and those of the NBFC-ND appointed as BC, while there has to be a specific contractual arrangement between the bank and the NBFC-ND to ensure that all possible conflicts of interest are adequately taken care of. Banks should ensure that the NBFC-ND does not adopt any restrictive practice such as offering savings or remittance functions only to its own customers and forced bundling of services offered by the NBFC-ND and the bank does not take place. With a view to ensuring adequate supervision over the operations and activities of the retail outlet/sub-agent of BCs by banks, every retail outlet/sub-agent of BC is required to be attached to and be under the oversight of a specific bank branch designated as the base branch. The distance between the place of business of a retail outlet/sub-agent of BC and the base branch should ordinarily not exceed 30 kms in rural, semi-urban and urban areas and 5 kms in metropolitan centres. In case there is a need to relax the distance criterion, the District Consultative Committee (DCC)/State level Bankers Committee (SLBC) could consider and approve relaxation on merits in respect of under-banked areas etc.

India's crude oil refinery output falls 2.3% in May 2014

Overall capacity utilization was lower at 99.5% during May 2014 as well as at 99.6% in April-May FY2015 

India's crude oil refinery output declined for second straight month at 2.3% to 18.182 million tonnes (mt) in May 2014, as per the data released by Ministry of Petroleum and Natural Gas. Public sector refineries recorded sharp 7.8% dip in the output to 9.245 mt in May 2014. However, the output of Public-private joint venture refineries moved up 8.2% to 1.308 mt, while that of private refiners rebounded 3.3% to 7.629 mt in May 2014 after two months of decline. 

Among the public refineries, the output of Indian Oil dipped 10.7% to 4.294 mt, while the output of Bharat Petroleum also plunged 13.6% to 1.754 mt in May 2014. The output of Hindustan Petroleum declined 8.8% to 0.913 mt, while the output of Chennai Petroleum improved 2.9% to 0.995 mt. Further, the output of Numaligarh Refineries also increased 8.9% to 0.259 mt, while that of Mangalore Refineries inched up 6% to 1.026 mt in May 2014.
Among the JV refineries, Bharat Oman recorded 19.7% surge in output to 0.443 mt, while the output of HPCL Mittal increased 3.1% to 0.865 mt in May 2014. Among private refiners, the output of Essar Oil declined 0.7% to 1.74 mt, while that of Reliance Petroleum increased 4.6% to 5.889 mt in May 2014. 

The cumulative refinery output rose declined 2% to 35.816 mt during April-May FY2015. The output of public refineries declined 2.8%. Among the public refineries, Indian Oil, Bharat Petroleum, Hindustan Petroleum, Chennai Petroleum and Mangalore Refineries recorded decline in refinery output, while the output of Numaligarh Refineries increased in April-May FY2015. 

The overall capacity utilization was lower at 99.5% during May 2014 as well as at 99.6% in April-May FY2015, compared to 101.9% in May 2013 and 101.7% in April-May FY2014.

India's natural gas production declines 2.2% in May 2014

Natural gas output falls 5% in April-May FY2015 

India's natural gas production declined 7.7% to 2.943 billion cubic meters (bcm) in May 2014, as per the data released by Ministry of Petroleum and Natural Gas. The natural gas output of ONGC fell 0.2% to 1.934 bcm, while that of Oil India increased 3.3% to 0.229 bcm in May 2014. Meanwhile, the natural gas output of private/JV companies declined 8.2% to 0.779 bcm in May 2014. The natural gas output has declined 5% to 5.713 bcm in April-May FY2015, continuing fall in output for fourth straight year.

Rupee gets stronger

At 60.09/10 per dollar 

Rupee opened higher at 60.09/10 per dollar on Tuesday (24 June 2014), versus its previous close of 60.20/21 per dollar.

FPIs continue selling

Net outflow of Rs 184.79 crore on 23 June 2014 

Foreign portfolio investors (FPIs) sold shares worth a net Rs 184.79 crore on Monday, 23 June 2014, compared with net outflow of Rs 209.48 crore on Friday, 20 June 2014. 

The net outflow of Rs 184.79 crore on Monday, 23 June 2014, was a result of gross purchases of Rs 2770.36 crore and gross sales of Rs 2955.15 crore. There was a net outflow of Rs 186.41 crore from the secondary equity market on 23 June 2014, which was a result of gross purchases of Rs 2768.56 crore and gross sales of Rs 2954.97 crore. The S&P BSE Sensex had shed 74.19 points or 0.3% to settle at 25,031.32 on that day, its lowest closing level since 5 June 2014. 

There was a net inflow of Rs 1.62 crore into the category 'primary market & others' on 23 June 2014, which was a result of gross purchases of Rs 1.80 crore and gross sales of Rs 0.18 crore. 

FPIs have bought shares worth a net Rs 13524.02 crore in this month so far (till 23 June 2014). FPIs bought shares worth Rs 14006.15 crore in May 2014. 

FPIs have bought shares worth a net Rs 59328.40 crore in this calendar year so far (till 23 June 2014). FPIs bought shares worth a net Rs 113135.90 crore in 2013 calendar year.

Farokh Subedar appointed Chairman, Tata Asset Management

With effect from 11 June 2014 

Mr Farokh Subedar has been appointed as Chairman of Tata Asset Management Ltd (TAML) with effect from 11th June 2014. Mr Farrokh Kavarana, who was Chairman, TAML for over 12 years, retired having attained the retirement age of 70 years. 

In addition to his current executive responsibility as Chief Operating Officer of Tata Sons, Mr Subedar is the Vice Chairman of Tata Investment Corporation and a Director on the boards of several Tata companies, including Tata Capital, Tata Capital Financial Services and Tata AIG General Insurance Company in the financial services sector.

Tata MF Announces Retirement of Key Personnel

With effect from 09 June 2014

Tata Mutual Fund has announced that F.K. Kavarana has retired as the Chairman and Director of Tata Asset Management Company, with effect from 09 June 2014.

Franklin Templeton Mutual Fund Announces Dividend Under Various Schemes

Record date for dividend is 20 June 2014 

Franklin Templeton Mutual Fund has announced 20 June 2014 as the record date for declaration of dividend under the following schemes. The amount of dividend (Rs per unit) on the face value of Rs 10 per unit (except for Templeton India Short Term Income Plan, which has a face value of Rs 1000 per unit) will be: 

Templeton India Income Fund-Dividend Plan & Direct-Dividend option:
Individuals & HUF: 0.175
Others: 0.167

Templeton India Income Builder Account-Plan A & B-Quarterly Dividend Option & Plan A-Direct- Quarterly Dividend Option:
Individuals & HUF: 0.194
Others: 0.186 

Templeton India Income Opportunities Fund-Dividend Option & Direct- Dividend Option:
Individuals & HUF: 0.175
Others: 0.167

Templeton India Corporate Bond Opportunities Fund-Dividend option & Direct-Dividend Option:
Individuals & HUF: 0.175
Others: 0.167

Templeton India Low Duration Fund-Quarterly Dividend Option & Direct-Quarterly Dividend Option:
Individuals & HUF: 0.210
Others: 0.201

Templeton India Government Securities Fund-Composite Plan-Dividend Option & Direct Plan-Dividend Option:
Individuals & HUF: 0.171
Others: 0.164

Templeton India Government Securities Fund-Long Term Plan-Quarterly Dividend Option & Direct-Quarterly Dividend Option:
Individuals & HUF: 0.171
Others: 0.164

Templeton India Government Securities Fund-Treasury Plan-Dividend Plan & Direct-Dividend Option:
Individuals & HUF: 0.175
Others: 0.167

Templeton India Short Term Income Plan-Retail Plan-Quarterly Dividend Option & Retail Plan-Direct Plan-Quarterly Dividend Option:
Individuals & HUF: 17.144
Others: 16.419

Franklin India Savings Plus Fund- Retail Plan-Quarterly Dividend Option & Retail Plan-Direct Plan-Quarterly Dividend Option:
Individuals & HUF: 0.171
Others: 0.164

FT India Monthly Income Plan-Plan A & B-Quarterly Dividend Option & Plan A-Direct-
Quarterly Dividend Option:
Individuals & HUF: 0.194
Others: 0.186

FT India Life Stage Fund of Funds-50s Plus Plan-Dividend Plan & 50s Plus Plan-Direct-dividend Option:
Individuals & HUF: 0.194
Others: 0.186

FT India Life Stage Fund of Funds-50s Plus Floating Rate Plan-Dividend Plan & 50s Plus Floating Rate Plan-Direct-dividend Option:
Individuals & HUF: 0.214
Others: 0.205

Reliance MF Announces Dividend Under Its Schemes

Record date for dividend is 20 June 2014 

Reliance Mutual Fund has announced 20 June 2014 as the record date for declaration of dividend under the following schemes. The amount of dividend (Rs per unit) on the face value of Rs 10 per unit will be: 

Reliance Medium Term Fund - Dividend Plan-Quarterly Dividend Plan: 0.2427 

Reliance Medium Term Fund - Direct Plan-Dividend Plan-Quarterly Dividend Option: 0.2521 

Reliance Monthly Income Plan - Dividend Plan-Quarterly Dividend Option: 0.2400 

Reliance Monthly Income Plan – Direct Plan - Dividend Plan-Quarterly Dividend Option: 0.2570 

Reliance Dynamic Bond Fund – Dividend Plan – Quarterly Dividend Option: 0.3860 

Reliance Dynamic Bond Fund – Direct Plan - Dividend Plan – Quarterly Dividend Option: 0.4007

Canara Robeco Mutual Fund Announces Dividend Under Two Schemes

Record date for dividend is 20 June 2014

Canara Robeco Mutual Fund has announced 20 June 2014 as the record date for declaration of dividend under the dividend option of following schemes. The amount of dividend (Rs per unit) on the face value of Rs 10 per unit will be: 

Canara Robeco Gilt PGS – Regular Plan & Direct Plan: 0.35 under each plan/option. 

Canara Robeco Dynamic Bond Fund - Regular Plan & Direct Plan: 0.35 under each plan/option.

Kotak MF Announces Dividend Under Various Schemes

Record date for dividend is 20 June 2014 

Kotak Mutual Fund has announced 20 June 2014 as the record date for declaration of dividend under the quarterly dividend option of following schemes. The amount of dividend on the face value of Rs 10 per unit will be: 

Kotak Flexi Debt Scheme-Regular Plan: 0.2556 

Kotak Flexi Debt Scheme-Plan A: 0.1724 

Kotak Flexi Debt Scheme-Plan A-Direct Plan: 0.2919 

Kotak Monthly Income Plan: 0.2147 

Kotak Monthly Income Plan-Direct Plan: 0.2319 

Kotak Income Opportunities Fund: 0.3238 

Kotak Multi Asset Allocation Fund: 0.1931 

Kotak Multi Asset Allocation Fund – Direct Plan: 0.2073 

Kotak Medium Term Fund: 0.1855 

Kotak Medium Term Fund – Direct Plan: 0.1962

UTI Fixed Term Income Fund – Series XIX – VI (366 Days) Floats On

NFO period is from 16 June to 23 June 2014 

UTI Mutual Fund has launched a new fund named as UTI - Fixed Term Income Fund – Series XIX – VI (366 Days), a close ended income scheme. The duration of the scheme is 366 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 16 June to 23 June 2014. 

The investment objective of the scheme is to generate returns by investing in a portfolio of fixed income securities maturing on or before the date of maturity of the scheme. 

The scheme offers growth option, quarterly dividend option with payout and reinvestment facility, flexi dividend option with payout and reinvestment facility, annual dividend option with payout and reinvestment facility and maturity dividend option with payout facility. 

The scheme would allocate upto 100% of assets in debt instruments with low to medium risk profile and upto 100% of assets would be allocated to money market instruments with low risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 under all the options. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

Benchmark Index for the scheme is CRISIL Short Term Bond Fund Index. 

Manish Joshi is the fund manager for the scheme.

SBI MF Announces Change In Fundamental Attributes of SBI Magnum Midcap Fund

SBI Mutual Fund has announced the change in fundamental attributes of SBI Magnum Midcap Fund. 

The proposed changes are: 

Investment objective: The scheme aims to provide investors with opportunities for long-term growth in capital along with the liquidity of an open-ended scheme by investing predominantly in a well-diversified basket of equity stocks of Midcap companies. 

Asset Allocation:
The scheme will invest 65%-100% of assets in equity and equity related instruments of midcap companies, invest upto 35% of assets in equity and equity related instruments of smallcap companies, invest upto 20% of assets in equity and equity related instruments of largecap companies, invest upto 10% of assets in foreign securities / ADR's / GDR's with high risk profile and invest upto 30% of assets in debt and money market instruments with low to medium risk profile. 

Existing investors have an option to exit without payment of exit load between 17 June 2014 and 16 July 2014.

DSP BlackRock Dynamic Asset Allocation Fund Announces Dividend

Record date for dividend is 20 June 2014 

DSP BlackRock Mutual Fund has announced 20 June 2014 as the record date for declaration of dividend in dividend option under regular plan and direct plan of DSP BlackRock Dynamic Asset Allocation Fund. The amount of dividend (Rs per unit) on the face value of Rs 10 per unit will be: 

Individuals / HUF: 0.27274

Others: 0.261214

DWS Fixed Maturity Plan – Series 72 Floats On

NFO period is from 16 June to 30 June 2014

Deutsche Mutual Fund has unveiled a new fund named as DWS Fixed Maturity Plan - Series 72, a 3 years close ended debt fund. The tenure of the scheme is 3 years from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 16 June to 30 June 2014. 

The objective of the scheme is to generate income by investing in debt and money market instruments maturing on or before the date of the maturity of the scheme. 

The scheme offers regular option and direct option. Direct plan is only for investors who purchase /subscribe units in a scheme directly with the fund and is not available for investors who route their investments through a distributor. Dividend payout (regular, quarterly and annual) and growth are the sub-options offered under the scheme. 

The scheme would allocate 70%-100% of assets in domestic debt instruments including government securities and securitized debt excluding money market instrument with low to medium risk profile and invest upto 30% of assets in money market instruments with low risk profile. 

The minimum application amount is Rs 5,000 and in multiples of Rs 1 thereafter. 

The fund seeks to collect a minimum subscription amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

The benchmark index will be CRISIL Short Term Bond Fund Index. 

The fund manager for the scheme is Rakesh Suri.a

LIC Nomura Fixed Maturity Plan – Series 85 (730 Days) Floats On

NFO period is from 16 June to 24 June 2014 

LIC Nomura Mutual Fund has launched a new fund named as LIC Nomura MF Fixed Maturity Plan – Series 85, a close ended income scheme with the duration of 730 days. The new fund offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 16 June to 24 June 2014. 

The investment objective of the scheme is to minimize interest rate risk by investing in a portfolio of fixed income securities which mature on or before the date of the maturity of the scheme. 

The scheme offers two options viz. growth and dividend payout option. 

The scheme would allocate 75%-100% of assets in debt instruments and invest upto 25% of assets in money market instruments with low to medium risk profile. Debt includes securitized debt upto 50%. 

The minimum application amount is Rs 10000 and in multiple of Rs 1 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

The units of the scheme will be listed on National Stock Exchange of India, in order to provide liquidity. 

Entry load: Nil 

Exit load: Not applicable for the scheme. 

Benchmark index for the scheme is CRISIL Short Term Bond Fund Index. 

The fund manager of the scheme is Killol Pandya.

Sundaram Hybrid Fund – Series K (5 Years) Floats On

NFO period is from 16 June to 30 June 2014

Sundaram Mutual Fund has launched a new fund named as Sundaram Hybrid Fund – Series K, a five years close end income scheme. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue is open for subscription from 16 June to 30 June 2014. 

The objective of the Scheme would be to generate capital appreciation and current income, through a judicious mix of investments in equities and f ixed income securities. 

The scheme offers dividend payout (half yearly & yearly) and growth option. 

The scheme will allocate upto 65%-90% of assets in fixed income securities, upto 20% of assets in money market instruments & cash equivalent with low to medium risk profile and invest upto 10%-35% in equity and equity related instruments with high risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 1 thereafter. 

The fund seeks to collect a minimum subscription amount of Rs 20 crore under the scheme during the NFO period. 

Entry load: Nil. 

Exit load: Not applicable. 

The scheme's performance will be benchmarked against CRISIL MIP Blended Index. 

The fund managers of the scheme are Siddharth Chaudhary and Shiv Chanani.

Tata Fixed Maturity Plan Series 48 Scheme C (370 Days) Floats On

NFO period is from 16 June to 23 June 2014 

Tata Mutual Fund has launched a new fund named as Tata Fixed Maturity Plan Series 48 Scheme C, a close-ended debt scheme with the duration of 370 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs. 10 per unit. The new issue will be open for subscription from 16 June and close on 23 June 2014. 

The investment objective of the scheme is to generate income and / or capital appreciation by investing in wide range of fixed income instruments having maturity in line with the maturity of a scheme. 

The scheme offers growth option and periodic dividend option (payout). 

The scheme shall invest upto 100% of assets in debt and money market instruments with low to medium risk profile. 

The minimum application amount is Rs 5000 and multiples of Re 1 thereafter. 

The fund seeks to collect a minimum subscription amount of Rs 20 crore under the scheme during the NFO period. 

Entry load: Not applicable. 

Exit load: Nil. 

Benchmark Index for the scheme is Crisil Short Term Bond Fund Index 

The fund manager for the scheme will be Amit Somani.

HDFC FMP 370D June 2014 (2) Floats On

NFO period is from 19 June to 24 June 2014

HDFC Mutual Fund has launched a new plan named as HDFC Fixed Maturity Plan 370D June 2014 (2), a plan under HDFC Fixed Maturity Plans – Series 31 (a close-ended income scheme). The face value of the new issue will be Rs 10 per unit. The new issue will be open for subscription from 19 June to 24 June 2014. 

The investment objective of the plan is to generate regular income through investments in debt / money market instruments and government securities maturing on or before the maturity date of the plan. 

The plan shall offer three options – growth, dividend and flexi option. The plan would invest upto 100% of assets in debt instruments, money market instruments and government securities with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. 

Entry and exit load charge will be nil for the plan. 

Benchmark Index for the plan is CRISIL Short Term Bond Fund Index. 

The fund managers of the scheme are Shobhit Mehrotra & Rakesh Vyas (Dedicated fund manager for overseas investments).

ICICI Prudential Capital Protection Oriented Fund VI – Plan C (1825 Days) Floats On

NFO period is from 17 June to 01 July 2014 

ICICI Prudential Mutual Fund has launched a new fund named as ICICI Prudential Capital Protection Oriented Fund VI – Plan C (1825 Days), a close ended capital protection oriented scheme. The new fund offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 17 June and will close on 01 July 2014. 

The investment objective of the scheme 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 scheme. 

The scheme offers regular plan – cumulative option, direct plan – dividend option, regular plan – cumulatiove option and regular plan – dividend option. 

The scheme would allocate 65%-100% of assets in debt & money market instruments with low to medium risk profile and invest upto 35% in equity and equity related securities with medium to high risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

The scheme is proposed to be listed on NSE. 

Entry and exit load charge will be not applicable. 

Benchmark Index for the scheme is CRISIL MIP Blended Index. 

The fund managers of the scheme are Vinay Sharma (equity portion), Aditya Pagaria & Rahul Goswami (debt portion) and Ashwin Jain (For investments in ADR / GDR and other foreign securities).

Reliance Fixed Horizon Fund – XXVI – Series 31 Floats On

NFO period is from 17 June to 24 June 2014

Reliance Mutual Fund has launched a new fund named as Reliance Fixed Horizon Fund – XXVI – Series 31, a close ended income scheme with the duration of 366 days from the date of allotment. During the New Fund Offer (NFO) the scheme will offer units at Rs 10 per unit. The new issue will be open for subscription from 17 June to 24 June 2014. 

This product is suitable for investors seeking returns and growth over the term of the fund limiting interest rate volatality by investment in debt, money market and G-sec instruments maturing on or before the date of maturity of the scheme with low risk - Blue. 

The primary investment objective of the scheme is to generate returns and growth of capital by investing in a diversified portfolio of Central, State Government securities and other fixed income/ debt securities maturing on or before the date of maturity of the scheme with the objective of limiting interest rate volatility. 

The scheme offers two options viz. growth, dividend payout option and direct plan – growth option and direct plan – dividend payout option. 

The scheme would invest upto 100% of assets in money market instruments, government securities & debt instruments with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Re 1 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

Benchmark Index for the scheme is CRISIL Short Term Bond Fund Index. 

The fund manager of the scheme will be Amit Tripathi.

JPMorgan Emerging Markets Opportunities Equity Offshore Fund Floats On

NFO period is from 16 June to 30 June 2014

JP Morgan Mutual Fund has launched a new fund named as JPMorgan Emerging Markets Opportunities Equity Offshore Fund, an open ended funds of funds scheme. During the New Fund Offer (NFO) the scheme will offer units at Rs 10 per unit. The new issue will be open for subscription from 16 June to 30 June 2014. 

The primary investment objective of the scheme is to seek to provide long term capital growth by investing predominantly in the JPMorgan Funds – Emerging Markets Opportunities Fund, an equity fund which invests primarily in an aggressively managed portfolio of emerging market companies. 

The scheme would invest 95%-100% of assets in shares of the underlying fund i.e. JPMorgan Funds – Emerging Markets Opportunities Fund with high risk profile and invest upto 5% of assets in money market instruments, cash & cash equivalents and / or units of liquid schemes with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Re 1 thereafter. 

Entry load: Nil 

Exit load: 1% for redemption within 12 (twelve) months from the date of allotment in respect of purchase made other than through SIP; and within 12 (twelve) months from the date of allotment in respect of each purchase made through SIP and nil for redemption beyond 12 (twelve) months from the date of allotment. 

Benchmark Index for the scheme is Morgan Stanley Capital International (MSCI) Emerging Markets Index (Total Return Net). 

The fund manager of the scheme is Namdev Chougule.

Government imposes US$ 300/tonne MEP on onion exports

MEP is re-introduced after three months of abolition 

Government of India has imposed a minimum export price (MEP) of US$ 300 per tonne on onion to curb exports and help cool domestic prices. 

The Minimum Export Price (MEP), the rate below which no exports are allowed, has been re-introduced barely 3 months after the previous government had abolished it in March 2014. 

The Commerce Ministry notification sais that the export of all onion varieties will be subject to MEP of US$ 300 per tonne.

FPIs continue buying

Net inflow of Rs 1250.17 crore on 13 June 2014 

Foreign portfolio investors (FPIs) bought shares worth a net Rs 1250.17 crore on Friday, 13 June 2014, compared with inflow of Rs 2493.97 crore on Thursday, 12 June 2014. 

The net inflow of Rs 1250.17 crore on Friday, 13 June 2014, was a result of gross purchases Rs 5384.39 crore and gross sales of Rs 4134.22 crore. There was a net inflow of Rs 1170.41 crore into the secondary equity market on 13 June 2014, which was a result of gross purchases of Rs 5304.53 crore and gross sales of Rs 4134.12 crore. The S&P BSE Sensex had lost 348.04 points or 1.36% to settle at 25,228.17 on that day, its lowest closing level since 5 June 2014. 

There was a net inflow of Rs 79.76 crore into the category 'primary market & others' on 13 June 2014, which was a result of gross purchases of Rs 79.86 crore and gross sales of Rs 0.10 crore. 

FPIs have bought shares worth a net Rs 14102.92 crore in this month so far (till 13 June 2014). FPIs bought shares worth Rs 14006.15 crore in May 2014. 

FPIs have bought shares worth a net Rs 59907.30 crore in this calendar year so far (till 13 June 2014). FPIs bought shares worth a net Rs 113135.90 crore in 2013 calendar year.

Rupee hits back strongly

At 60.03/04 per dollar 

Rupee recovered from near two month low on Tuesday (17 June 2014) at 60.03/04 per dollar, against its previous close of 60.1550/1650 on Monday.

  Rupee gained strongly thanks to RBI chief's assurance that India is prepared to deal with external shocks, RBI selling dollars via state-run banks supported the increase.

Asia Pacific Market: Equities mixed amid Iraq concerns

Asia pacific shares closed mixed on Tuesday, 17 June 2014, as investors trimmed risk holdings amidst geopolitical concerns in Iraq together with a downgrade for US growth estimates. The MSCI Asia Pacific Index lost less than 0.1%. 

An escalation of violence in the Middle East pushed oil prices higher and contributed to declines in Asia-Pacific equities. In Iraq, Kurdish troops are defending the fourth-largest oilfield against Islamist militants. Army troops killed more than 270 rebels yesterday in Iraq, OPEC's second-biggest crude producer, as the prospect of civil war intensifies with Sunni Muslim insurgents controlling territory north of Baghdad. 

The International Monetary Fund yesterday cut its economic growth forecast for the U.S. in 2014. The IMF now sees expansion of 2%, down from an April estimate of 2.8%, while it left its 2015 prediction unchanged at 3%. 

Trading turnover was generally quiet, as markets waited for the conclusion of the Federal Reserve's policy meeting on Wednesday, which will give an update on the direction of monetary policy in the world's largest economy. 

Among Asian bourses
 
Miners sink Australia market 

Australian share market declined amidst continued iron ore weakness, geopolitical concerns in Iraq and Russia together with a downgrade for US growth estimates. The benchmark S&P/ASX200 and the broader All Ordinaries each declined by 0.2% to 5400.70 and 5380.70, respectively. 

Sydney shares took a soft lead from offshore after equities in the United States edged higher, while London's FTSE moved modestly lower. Investors are cautious amid increasing geo-political risk in Iraq, and waiting on announcements from the US Federal Reserve and Bank of England on Wednesday night for any hints as to the future direction of global monetary policy. 

Today was one of the busier days for economic news locally, with the results of a weekly consumer confidence survey, RBA Board minutes, data on car sales and a quarterly publication on agricultural commodities issued. The highlight though is the RBA's latest board meeting minutes. Comments suggest that Australia's central bank is in no rush to lift interest rates. 

Shares of material and resources companies declined after the price of iron ore fell below US$90 per tonne last night for the first time since September 2012. The weaker ore price is squeezing profit margins for global producers of the metal. Resources giant BHP Billiton dropped 0.7% to A$35.36. Main rival Rio Tinto lost 1% to A$57.45. Fortescue Metals Group declined 3% to A$3.94. 

Energy stocks were weaker as investors booked profit following recent surge on spike in crude oil price. The price of oil was largely flat overnight; however surged by 4% last week partly due to violence in Iraq. Origin Energy was down 0.2% to A$14.28, Santos 1.5% to A$14.50 and Oil Search 0.5% to A$9.77. 

Australia's biggest oil producer Woodside Petroleum was in trading halt after announcing that Royal Dutch Shell PLC will sell 19% of it´s holding in WPL in a transaction that will yield A$6.1 billion. 50% of the shares will be sold to institutional investors, while Woodside would buy the remainder 78 million shares (9.5% of the company) from Shell at a discounted price of A$36.49. Shell will retain a 4.1% stake. 

The retailers were mostly firmer, with the latest weekly ANZ/Roy Morgan survey results on consumer confidence rising 1%. Myer was up 1% to A$2.02 while surfwear retailer Billabong (BBG) rose 4% to A$0.515. David Jones added 0.5% to A$3.88 on heavy volume ahead of an investor meeting on South Africa's Woolworths' bid. 

Gambling was the best performing sub-sector after casino operator Echo Entertainment upgraded its profit guidance on Monday. Echo added another 2.7% to A$3.06, while Tatts Group, Aristocrat Leisure, and Tabcorp all rose on the positive sentiment for the sector. 

Nikkei bounces 0.3% 
 
Japan market closed higher, recovering slightly from a sharp fall in the previous session, supported by a weaker yen, which stabilized after the dollar softened overnight. But, jitters over the growing unrest in Iraq capped gains. The benchmark Nikkei 225 index grew 0.29% to finish at 14975.97, while the Topix index of all first-section shares added 0.29% to 1238.20. 

Investors took advantage of cheaper valuations after the Nikkei tumbled more than 1% on Monday in reaction to the fighting in Iraq, where militants are sweeping towards Baghdad after taking over several towns. Meanwhile, buoyant dollar and higher Wall Street stocks supported the Japanese market. 

In foreign exchange trade, the greenback was last trading at 102.03 yen, compared with 101.83 yen late Monday in the New York. A weaker yen is positive for exporters' shares as it improves their profitability. 

Shares of exporters and inflation-sensitive stocks such as brokerages and real estate companies climbed up, on the back of yen weakening against the US dollar. Daikin Industries gained 1.8% to 6351 yen and Canon Inc rose 0.2% to 3391 yen while Uniqlo clothing chain operator Fast Retailing added 0.30% to end at 33250 yen. Among financials, Daiwa Securities Group rose 0.7% to 853 yen. 

Casino-related stocks rose sharply on speculative buying following afternoon news that Japan will begin legislative procedures Wednesday to eventually legalize casino gambling. Konami Corp rose 2.1% to 2300 yen, while Sega Sammy Holdings added 2.6% and Japan Cash Machine surged 8.4%. 

Kobe Bussan Co. slumped 3.9% to 2,969 yen after the Japanese supermarket operator's first-half net income plunged. 

Mitsubishi Heavy Industries fell 1.42% to 621 yen after the Japanese giant and Germany's Siemens on Monday unveiled the terms of their joint bid for the energy assets of French industrial jewel Alstom, also coveted by US industry giant General Electric
Shares of SoftBank Corp declined 2.5% to 7483 yen on concerns over the growth rate at its Chinese e-commerce affiliate Alibaba Group Holdings, in which it owns a 34% stake. Alibaba, which will list its shares in the U.S. this autumn, reported that its quarterly operating margin fell to 45.3% from 51.3% a year ago. 

China market ends 0.92% down
 
Mainland China share market declined on Tuesday, 17 June 2014, as profit booking triggered across the board after the key bourses surged to highest level in two-month yesterday and as foreign direct investment in the world's second-largest economy unexpectedly declined. The benchmark Shanghai Composite closed 0.92% down from prior day to 2066.70. Market turnover decreased to 70.92 billion yuan from yesterday's 79.95 billion yuan. 

The Ministry of Commerce said on Tuesday that non-financial foreign direct investment in China totalled $8.6 billion in May, down 6.7% from a year earlier and also below April's $8.7 billion figure. FDI in the first five months of the year was still up 2.8% year-over-year, at $48.91 billion. FDI from the 28 EU nations was down 22.1% year-over-year in the January-to-May period, the Ministry of Commerce said Tuesday. Investment from the U.S. was down 9.3%. 

A survey published last month by the European Union Chamber of Commerce in China found that European companies were becoming more cautious about investing in the world's second-largest economy. Only one in five said China was their top destination for new investments, down from one in three a year earlier. Among the complaints cited by foreign companies, arbitrary law enforcement and rising labor costs were high on the list. Another concern is the perception that China is set for a long-term economic slowdown. 

Shares of banks and developers declined the most in Shanghai market today on profit booking. ICBC fell 1.3%. Ping An Insurance (Group) Co. declined 1.3%. Industrial Bank Co. retreated 1.5% from a two-month high. China Vanke, the nation's biggest developer by market value traded on mainland exchanges, dropped 1.7%. 

Shares of industrial companies also retreated, falling for the first time in six days amid profit booking. China CAMC Engineering dropped 4.2%. Shanghai Waigaoqiao Free Trade Zone Development Co. slumped 2%. 

The People's Bank of China drained 30 billion yuan via 28-day repurchase agreements on Tuesday. This week sees 65 billion yuan in funds maturing and flowing back into the system, with Tuesday's operation putting the bank on track to inject an amount far smaller than last week's 104 billion yuan net addition. 

Hong Kong stocks fall on Iraq concerns
 
Hong Kong share market declined for second consecutive session on Tuesday, 17 June 2014, as risk aversion selloff amid jitters over the growing unrest in Iraq together with a downgrade for US growth estimates. The benchmark Hang Seng Index closed 0.42% down from prior day closure at 23203.59. Trading turnover increased to HK$49.11 billion from yesterday's HK$47.83 billion. 

Belle International Holdings was up 2.5% to HK$8.21, being the top blue-chip gainer today. AIA Group dipped 1.4% to HK$38.85, being the biggest blue-chip loser. 

Jewellery retailer King Fook Holdings jumped 45% to HK$1.07 after saying its controlling stakeholder was approached by potential investors. 

GCL-Poly Energy Holdings Ltd., the world's biggest maker of polysilicon, tumbled 5.4% to HK$2.45 in Hong Kong after BNP Paribas SA said installation of solar energy panels in China will slow this year. 

New World China (NWC)(00917) plunged 17% to HK$5.3, while its parent New World (00017) dipped 1% to HK$8.8. Both companies resumed trading after the proposal of taking NWC private was voted down by shareholders yesterday. 

Macau gaming players were pressured on news that Macau police authorities will shorten the stay period for China-passport holders on transit visas to 5 days from 7 days previously starting from July. Melco (00200) slid 4% to HK$21.65. Galaxy Ent (00027) fell 1% to HK$56.75. Sands China (01928) declined 1.4% to HK$53.1. 

Census and Statistics Department said on Tuesday that Hong Kong's seasonally adjusted unemployment rate stood at 3.1% in March - May 2014, same as that in February - April 2014. The underemployment rate increased from 1.4% in February - April 2014 to 1.5% in March - May 2014. 

On the short-term outlook, the Secretary for Labour and Welfare, Matthew Cheung Kin-chung, said downside risks to the Hong Kong economy have increased recently. Apart from the unsteady global economic recovery and escalating geopolitical risks, the recent softening trend in the local consumption market is also a cause of concern. These domestic and external uncertainties, coupled with the entry of a new batch of fresh graduates and school leavers in the coming few months, may progressively pose some pressure on the labour market. 

Sensex advances 
 
After a lackluster first half, Indian stocks rallied in second half of the day's trading session as crude oil prices futures eased in volatile trade and as Reserve Bank of India Governor Raghuram Rajan's comments that India is currently better prepared to deal with any shocks on the external front compared to last year triggered recovery in rupee against the dollar. The S&P BSE Sensex was up 330.71 points or 1.31% to 25,521.71, its highest closing level since 12 June 2014. The CNX Nifty was up 98.15 points or 1.3% to 7,631.70. 

India's largest oil exploration firm ONGC extended gains in late trade. PSU OMCs extended Monday's gains as the under-recovery on diesel declined for the fortnight commencing 16 June 2014. Maruti Suzuki India rose after a foreign brokerage maintained buy rating on the stock with a 15% increase in target price. Bank stocks rose on renewed buying. Cement stocks rose on expectations that cement demand will rise on government's thrust on the infrastructure sector. 

Telecom stocks were in demand, with shares of Idea Cellular extending Monday's gains triggered by the Reserve Bank of India (RBI) allowing hike in FII investment ceiling to 49% from earlier 24% of the paid-up capital of the company. Fertiliser shares were in demand on renewed buying. Capital goods stocks rose on renewed buying. Shares of Thermax scaled record high and ABB India hit 52-week high. Shares of state-run gas transmission & distribution company GAIL (India) extended Monday's rally triggered by buzz that a foreign brokerage has raised the price target on the stock. Aviation stocks rose on reports the aviation ministry has drawn up a plan to push infrastructure development, e-governance and air connectivity during the first 100 days of the new government. Tyre stocks were in demand on renewed buying, with shares of CEAT and Balkrishna Industries scaling record high. Sugar stocks rose on fresh buying. 

Elsewhere in the Asia Pacific region- Taiwan's Taiex index rose 0.41% to 9240.60. South Korea's KOSPI index was up 0.4% to 2001.55. Indonesia's Jakarta Composite Index grew 0.5% to 4909.52. Malaysia's KLSE Composite rose 0.16% to1874.60. New Zealand's NZX50 rose 0.28% to 5193.50. Singapore's Straits Times index slid 0.48% to 3274.44.