AIG Infrastructure and Economic Reform Fund

AIG Mutual Fund has launched a mutual fund called "AIG Infrastructure and Economic Reform Fund" which is an open-ended equity scheme that seeks to generate long-term capital appreciation by investing in companies that may benefit from potential investments in infrastructure and unfolding economic reforms without having any bias towards any sector or market capitalization range.

Under normal market conditions and depending on the fund manager's views, the assets of the Scheme would be invested across stocks that represent a broad range of sectors of the economy as mentioned below in order to ensure adequate portfolio diversification:

Infrastructure: Infrastructure companies operating in but not limited to power, oil and gas, telecom, water, housing, real estate, construction, roads, ports, airports, shipping & shipping building, logistics, etc. and sectors that will benefit from the development in infrastructure such as but not limited to cement, metals, capital goods and banking and financial services.

Economic reform oriented: Companies in sectors that will benefit from the on-going liberalization in the Indian economy including relaxation in foreign exchange controls, FDI in banking and financial services and any other industry or sector where there is a trend to moving toward a freer market based model like retail, media and entertainment, mining, etc.

The fund proposes to invest at least 65 per cent of the fund proceeds into Indian equities but under normal circumstances they will invest between 80% - 100% in equities. It has an option to invest upto a maximum of 35% in Debt Securities and Money Market Instruments and Fixed Income Derivative and in normal circumstances, they will invest between 0% - 20% in debt securities.


Scheme Details

Issue Opens: January 10, 2008
Issue Closes: January 31, 2008
Ongoing Offer: February 29, 2008

Type: Open ended equity scheme
Plan : Dividend Option,Growth Option. Dividend Option (with Payout Facility and reinvestment).
Minimum Investment: Rs. 5,000
Entry Load: 2.25% if the investment amount is less than 5 crores. In case of investment through SIP, it will be 1.25%.

Exit Load: If redemption happens before 1 year and the investment amount is less than 5 crores, then there will be an exit load of 1%.

The AMC will disclose details of the portfolio of the Scheme every 6 months by either sending a complete statement to all the Unit Holders or by publishing such statement, by way of advertisement, in two daily newspapers. The same shall also be displayed on the website of the fund.

HDFC Infrastructure Fund

HDFC Mutual Fund has launched a mutual fund that will target investments in the infrastructure fund. It is not surprising to see everyone getting into this bandwagon with a a hope to garner as much investment as possible for this sector given the fact that the Indian GDP growth cannot be achieved if Infrastructure does not perform.

This mutual fund joins the long list of similar finds launched by JM Mutual, Kotak, UTI in the recent past with similar themes.

Its objective is to see long-term capital appreciation by investing predominantly in equity and equity related securities of companies engaged in or expected to benefit from growth and development of infrastructure. This is a close ended fund

The scheme aims to invest in sectors like airports, banking and financial services, cement and cement products, construction and related industries, electrical and electronic components, energy, oil & gas and allied industries, petroleum and related industries, ports, power and power equipment, telecom, industrial capital goods, etc.

The fund proposes to invest at least 65 per cent of the fund proceeds into Indian equities related to infrastructure and infrastructure related companies. It has an option of investing upto a maximum 35 per cent into equities other than infrastructure. It has an option to invest upto a maximum of 35% in Debt Securities and Money Market Instruments and Fixed Income Derivative.

The Scheme may seek investment opportunity in Foreign Securities (max. 35% of net assets). The Scheme may take derivatives position for hedging, portfolio balancing or to undertake any other strategy as permitted under SEBI Regulations from time to time (max. 20% of the net assets) based on the opportunities available subject to SEBI Regulations.

Scheme Details
Issue Opens: January 8, 2008
Issue Closes: February 21, 2008
Type: Closed-end, equity scheme with automatic conversion to an open ended fund after 3 years
Plan : Dividend Option,Growth Option. Dividend Option (with Payout Facility only).
Minimum Investment: Rs. 5,000 and in multiples of 100 thereafter
Entry Load: Nil
Exit Load: Nil.

The scheme will offer for redemption or switch over of units on an ongoing basis at monthly intervals at NAV-based prices and the redemption or switch over will be available on the first two business days of each calendar month.

Lotus India Infrastructure Fund

Just like most other AMCs in the recent, Lotus India Mutual Fund also has come out with a three-year close ended equity fund called Lotus India Infrastructure Fund that will focus on Infrastruture as the theme for its investment. This fund would automatically be converted into an open ended fund after the expiry of three years from the date of allotment.

The scheme endeavors to generate long term capital appreciation by investing in a portfolio that is predominantly constituted of equity and equity related instruments of infrastructure companies.

The fund would adopt bottom up approach where the focus would be on specific company rather than on the industry in which that company operates or on the economy as a whole.

Between 65 to 100% of the portfolio allocation will be in equity and equity- linked instruments of companies engaged in infrastructure sector. Debt securities and money market instrument will comprise of 0 to 35% of the portfolio.

Snapshot:
Issue Opens: September 25, 2007
Issue Closes: October 24, 2007
Investment Options: Growth, Dividend Payout and Reinvestment
Minimum Investment: Rs 5000
Face Value: Rs 10
Load: The fund would not charge any entry or exit load. But, on redemption before maturity of the scheme, investors will be charged balance proportionate unamortized issue expenses on the applicable NAV.
Benchmark Index: S&P CNX 500