The Hindu Business Line : NFO mobilises Rs 25,000 cr in 2005

Mutual funds have raised over Rs 25,000 crore from new fund offers in 2005. This comprises inflows into equity funds and tax-saving funds but does not include inflows into open-end equity funds. This is the largest ever sum mobilised by mutual funds from new offers in any year. SBI Magnum Multi-Cap Fund received subscription of more than Rs 2,000 crore. Close-end funds also made a comeback, with Franklin India Smaller Companies Fund garnering Rs 1,200 crore.

Mutual fund houses have been permitted to launch gold exchange-traded funds. The Securities and Exchange Board of India has granted approval. A SEBI expert committee had recommended two models: In the first, gold is physically held by a custodian on behalf of a mutual fund and, in the second, gold warehouse receipts are held by a custodian bank on behalf of a fund.

HSBC Mutual has launched HSBC Advantage India Fund. The fund will invest in sectors and themes that play an important part in the country's socio-economic progress. The new fund offer is open for subscription between December 30 and January 27.

Franklin Templeton Investments has declared a tax-free dividend of 35 per cent (Rs 3.5 per unit) for Templeton India Growth Fund. Investors as on December 21 are eligible to receive the dividend. The fund, launched in 1996, adopts the `value investing' style.

UTI Asset Management Company plans to buy a controlling stake in a technology company, set up a call centre and own a distribution company. These initiatives are part of an aggressive growth strategy. The fund intends to more than double its assets under management to Rs 62,000 crore by 2010. The sponsors — SBI, PNB, Bank of Baroda and LIC — have also indicated their intent to run the AMC as a board-driven company.

UTI Mutual plans to launch three offshore funds to invest in Indian equities. The proposed funds will have a bigger corpus than the $30-60 million that is the size of the existing funds. UTI Mutual intends to maintain a growth rate of about 25 per cent in the assets under management.

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