Mumbai: Franklin Templeton AMC announced the launch of its open end income fund called Templeton India Corporate Bond Opportunities Fund.
New Fund Offer: November 15, 2011 – November 29, 2011
Scheme Re-opening on: December 08, 2011
Minimum Investment: Rs. 5,000
Cap on investment: Rs 5 crore per application per day.
Exit load: 3% if redeemed within 12 months from the date of allotment
2% if redeemed after 12 months but within 24 months from the date of allotment
1% if redeemed after 24 months but within 30 months from the date of allotment
Benchmark: Crisil Short Term Bond Fund Index
Fund Manager: Umesh Sharma and Sachin Padwal-Desai
Harshendu Bindal, President, Franklin Templeton India said, “We believe that the corporate bond market provides good opportunities in India for multiple reasons including a fast growing economy, strong corporate balance sheets and expected increase in issuances. With the launch of this fund, we will be building on our strong presence in the pure fixed income space that we have built in recent years. The fund helps investors take advantage of the current high yields and also potentially benefit from the capital gains once the interest cycle turns. The relatively high exit loads and a cap on maximum investment per folio make it a retail oriented product”
Mr. Santosh Kamath, CIO – Fixed Income feels corporate bonds are attractive investments. “Given India’s rapid economic growth and the strong earnings track record of corporate India, the interest in corporate bonds is likely to grow. The various initiatives by the RBI have led to an improvement in the Indian corporate bond market. Since the base rate of banks has moved up, many Indian companies are now looking at increased debt issuances as part of their funding plans. In the current environment, we expect corporate bonds in the 1-3 year segment to outperform due to relatively higher spreads and the fund will benefit from higher accruals in the coming quarters. As the macro conditions change, it should also benefit from capital gains due to spread compression and also due to the roll down effect. We will also leverage our internal equity research capabilities for the purpose of credit profiling,” said Santosh.
