'Equities best investment bet'

By Our Corporate Reporter

CHENNAI, JUNE 18. The mutual fund industry has done well in the past eighteen months with a major shift in investment to private sector mutual funds, according to Mr. Suraj Kaeley, Vice President (Marketing), Templeton Asset Management (India).

Addressing presspersons here on June 16 he said the last one year was an extremely good period for Templeton and the efforts put in had started giving dividends. The assets under its management had grown by 650 per cent since March 1999 to Rs. 1,945 crores. These were at Rs. 222 crores in December 1999 and Rs. 1,103 crores in December last. Major growth took place in the last six months, he said.

Mr. Kaeley He said equities were the best long-term bet. He cited an example based on Templeton research of BSE Sensex over an 18 year period. The study had revealed inflation went up by 9.19 per cent during the period, gold turned out an annualised return of 7.62 per cent, bank fixed deposits 9.74 per cent and company fixed deposits 14.47 per cent. But equities gave a cumulative annual return of 20.16 per cent over the same period. Even on a five year basis the BSE sensex outperformed other investments by 86 per cent, he said.

Mr. Nilesh Shah, Chief Investment Officer, explained the two new offerings under the Franklin brand name - Franklin India Index Fund (FIIF) and Franklin India Balanced Fund (FIBF) which will be open for subscription from June 26 to July 13.

The FIIF, an open-end passive index fund, would invest in all the stocks comprising the S & P CNX Nifty Index in approximately the same weightage that they were represented in the index. The CNX Nifty, representing 50 bluechip, large cap, liquid and highly traded stocks, was one of the most scientific indices in India, he added.The balanced fund, an open-end scheme, would invest in a prudent mix of debt and equity schemes and the objective was to provide long-term capital appreciation and current income. The fund would have a maximum exposure in any of the two asset classes of 60 per cent, he said.

Templeton India currently manages two equity funds (one under Templeton brand and the other under Franklin brand) and four debt funds all under Templeton brand.

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Section  : Business
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