Review — Birla Sun Life India Reforms Fund
12/05/2010 2 Comments
India’s economic reforms have always helped boost growth in respective sectors. The Green Revolution that started in the 50’s and 60’s in India is one such example of how the overall economy and the companies related to the sector benefited from the reforms rolled out at different points of time.
The support provided to the Information Technology sector in the 90s is another example of growth and how it triggered off a tremendous domino effect which is responsible for the stellar growth of many companies related to this sector. The positive cycle of reforms has not only helped the economy prosper but has improved the lifestyle of individuals within our society. Today another golden opportunity is knocking at your door with a new set of reforms on the anvil.
The Fund manager intends to closely follow various reforms and policy initiatives planned by the government from time to time and invests your money in companies that are likely to gain from such reforms.
Scheme Objective : The investment objective is to generate growth and capital appreciation by building a portfolio of companies that are expected to benefit from the economic reforms, PSU divestment and increased government spending in sectors such as Telecom, Power, Education, Roads, Railways, Healthcare etc.
Nature of the Scheme : Open Ended
Asset Allocation :
Equities and Equity related instruments* – 65-100%
Debt securities and Money Market Instruments(Including securitized debt) – 0-35%
*The scheme may also invest upto 35% of its net assets in ADRs/GDRs issued by Indian companies, which in the judgment of the Asset Management Company are eligible for investment as part of the scheme’s portfolio and is consistent with the investment strategy, subject to a limit based on net assets of the Mutual Fund in accordance with the SEBI guidelines issued from time to time
Investment Strategy :
This scheme seeks to generate income by predominantly investing in equity and equity linked instruments.
Reforms in the context of the scheme refers to a set of economic and financial sector policy initiatives that lay down progressive framework for trade and investment for businesses in India. Such reforms could be in the form of liberalisation / deregulation, public sector disinvestments / privatisation, special government incentives/investment support to key thrust areas like infrastructure/power/education, employment generation, etc. The process of reforms in essence is directed towards achieving inclusive and long term growth of the nation.We believe that the process of reforms in India is slow but irreversible. As reforms unfold, they would offer significant business and investment opportunities for sustained period. The scheme would seek to invest in companies that are expected to benefit from the government reforms program. These companies would encompass, but not be limited to, engineering, real estate & construction, power, telecom, infrastructure, financial services, Fertilizers, agrochemicals, irrigation, education and select commodity sectors. Investments will be pursued in selected sectors based on the Investment team’s analysis of business cycles, regulatory reforms, competitive advantage etc. Selective stock picking will be done from these sectors. The fund manager in selecting scrips will focus on the fundamentals of the business, the industry structure, the quality of management, sensitivity to economic factors, the financial strength of the company and the key earnings drivers. The scheme will invest across sectors without any market cap or sectoral bias.The scheme shall also undertake Securities Lending and Borrowing within the framework as permitted by SEBI.
Fund Manager : Mr. Ankit Sancheti
Investment Plans / Options : Dividend and Growth Plan.
Dividend Plan shall have Payout and Reinvestment option.
Default Plan/Option – Dividend Reinvestment
Minimum Subscription Amount : Minimum of Rs. 5,000/- and in multiples of Re. 1/- thereafter
Minimum Additional Amount : Minimum of Rs. 1,000/- and in multiples of Re. 1/- thereafter
Entry Load* : Nil
Exit Load : For units Redeemed / Switched out within 1 year from the date of allotment, an exit load of 1% is payable and for units Redeemed / Switched out after 1 year from the date of allotment, no exit load is payable.
Benchmark : S&P CNX 500
Investor Risk Profile : Medium to High
Dividend Policy : The Scheme may declare dividends at the discretion of the Trustee, subject to the availability of distributable surplus.
SIP / STP : Available
