How is your ELSS different from the existing products in the market?
The Indiabulls Tax Savings Fund will be a multi cap fund with 50% exposure to large caps and balance into mid & small caps. Thematically, it will be a portfolio comprising of “strong brands across various categories of products / solutions”. Empirically, companies that are or have strong brands tend to grow faster than the broader markets or even the nominal GDP. They benefit from high customer loyalty and bargaining power. They tend to generate higher profit margins due to stable long term growth prospects. Additionally, strong brands can enter new markets and command substantial royalties through brand licensing/franchising. Ideally, companies that are segment leaders or challengers will be part of our Tax Savings fund portfolio.
Share with us your plans to promote this product among distributors?
We are communicating with our distribution partners and advisors through focussed group meetings and heavy usage of digital media. We have stepped up our empanelment drive across the country and also partnered with some national level distributors and banks in promoting the new fund offer. The response is overwhelming!
Why should distributors consider selling this scheme?
Indiabulls AMC has been able to exhibit ability to generate consistently superior returns than benchmarks in line with the investment mandates of the schemes. Most of our flagship schemes are in the top quartile, especially the Indiabulls Blue Chip fund, a large cap fund, has been a stellar performer in top quartile over last 3 years. Indiabulls Value discovery fund is a unique fund based on discovering value through quantitative techniques based on multiple ratios that filter out high-performance companies. Indiabulls Arbitrage fund has been a chart-topper in its category. Consequently, brand awareness of Indiabulls AMC’s equity schemes has been growing and presently we have more than 2300 empanelled distributors recommending our funds. In the Tax Savings Fund, we hope to get more support from the advisory and intermediation partners.
Investors generally invest by looking at past returns. What would be your advice to them?
It is very important to see how the fund manager sticks to investment mandate across market vagaries and delivers consistent returns. All our 10 schemes have been “true to label” and we have been able to deliver consistent risk adjusted returns. Investors should be cognisant of risk-adjusted returns and should plan their asset allocation accordingly. Though rear view strategy is not a wrong one since only historical benchmarks are available, good investment management processes lead to consistent performances in the past and the future as well. We have proved it through our Bluechip Fund. We are confident of our sector and stock selection methods and will manage the Tax Savings Fund with similar robust processes
How much do you expect to raise during the NFO of this fund? How would you achieve this?
We intend to get over 2 lakh investors in this fund. Over the past 1 year, we have been expanding our sales teams and geographical presence. We intend to capitalise on this. Our last New Fund launched was in 2015 and after almost 2 years, we are hitting the markets with a NFO of a mass product like the Tax Savings fund, which we believe, will help us work more closely with the distribution fraternity. We are committed to working successfully with our distribution partners. Tax consciousness across the country has gone up significantly after demonetisation and GST drives. More investors will participate in tax-saving funds that also provide growth to their savings. Also, nowadays, we have observed that most people start their tax-planning well before Jan-March quarter. Hence, the timing seems to be well suited for such a product.
How are you reaching out to existing investors in your other schemes?
We have built a robust communication channel with our investors and distribution partners through mails, social media and customer/distribution partner help centre. We proactively update them on markets, events and other developments within the IBAMC. Since most of our existing funds have delivered consistently as per the scheme mandates, investors will be open to invest in our new fund which would not only give them the benefit of Sec 80 C but also potential growth over a longer period of time with the “Brands” Theme. Although our Tax Savings fund is essentially an ELSS product providing the 80C benefit, many investors can chose to invest in the Fund due to the disciplined investment management processes and generate long term capital appreciation
The industry is getting healthy inflows in equity funds. Do you think the trend will sustain?
Due to demonetisation and digitisation, we have seen a shift in the savings trend in India. People are moving monies from traditional options to mutual funds. We are seeing sustained inflows into the equity markets through SIPs and we believe this trend will only get stronger.
How are you leveraging technology to grow your business?
We have been very active across social media like Facebook, Twitter, Linkedin etc. A large proportion of our marketing campaign is across digital platforms like mobile ROS etc. We believe that today’s investors such as “millennials” spend more time on these platforms and this forms a basis of their investment decisions as well.
How do you plan to expand your distribution footprint?
Distribution is virtual and digital than ever before. We intend to use technology to reach out to every nook and corner of the country. Online transactions, payment wallets, platform tie-ups, banking channels etc. will ensure adequate coverage.