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Birla MF to rationalise debt funds' load structure

Nilanjan Dey

CALCUTTA, July 10

BIRLA Mutual Fund, which manages over Rs. 2,000 crores of debt assets, has decided to rationalise the load structures of all major debt funds. Its balanced fund has also come under this plan.

The load/contingent deferred sales charge (CDSC) structures for Birla Income Plus, the flagship income fund, Birla Gilt Plus and Birla Balance have been changed to keep up with the latest market dynamics, according to Mr. N. K. Sharma, Senior Vice-Presid ent of Birla MF.

The exit load on Birla Income Plus has now been reduced from 0.5 per cent (for redemptions before six months) to 0.25 per cent for redemptions before three months. Birla Cash Plus, the liquid scheme managed by Birla MF, as always, would have no entry or exit loads.

Birla Gilt Plus, which had no exit load in the previous set-up, would now charge 0.25 per cent for redemptions. However, its actual imposition would vary according to the option chosen by the investor. The scheme offered three options -- liquid pla n, investment plan and long-term plan.

The exit load would depend on the duration of investment: one month for liquid plan, three months for investment plan and one year for long-term plan.

Investors in Birla Balance would be required to pay one per cent CDSC for investments redeemed before two years. This, Mr. Sharma said, was a significant step in view of the reduction in CDSC, which was earlier 1.5 per cent and two per cent for redemptio ns before one year and two years respectively.

The simplification of the CDSC structure, he said, was expected to appeal to those interested in making fresh investments in Birla Balance, which had a NAV of around Rs. 12.40 in the growth option.

The annualised appreciation in the scheme was around 23 per cent since inception. The equity schemes managed by Birla MF, including flagship Birla Advantage Fund, carried entry loads of two per cent.