Nippon India MF has proposed to extend the maturity date of Nippon India Capital Builder Fund IV - Series B, a close-ended multi cap scheme that was launched on October 23, 2017.
This is the second close ended multi cap fund to seek extension on maturity date in recent times. In November, IDFC MF had also proposed to extend the maturity date of IDFC Equity Opportunity Fund Series 4 for 2 years.
Nippon India Capital Builder Fund IV - Series B was set to mature on January 6, 2021. But the fund house has proposed to extend the maturity date for another 2 years i. e. till January 6, 2023.
Since its launch, Nippon India Capital Builder Fund IV - Series B has delivered a CAGR of - 6.3% as on December 15. In comparison, its benchmark BSE 200 (TRI) has delivered a CAGR of 9.3%.
The fund house said that the purpose of this rollover is to give the close-ended fund adequate time to benefit from the expected broad-based recovery in economy and markets.
"Over the past couple of years or so, equity market has witnessed an extremely ‘Narrow or Polarized’ trend with returns concentrated only in select index heavyweights while the broader markets have underperformed. Currently, with the economy gradually coming out of lockdown and anticipated improvement in macro-economic scenario, we expect the prevailing narrow market trend to reverse. Therefore, the prevailing market conditions offer attractive investment opportunities wherein the fund may benefit from anticipated market broad basing over the medium term, " the fund house said in a note.
Now, unitholders of this scheme have the option to redeem their entire investment or rollover to continue their investment. Roll-over will happen only in case of those unitholders who provide their written consent to the AMC before January 6, 2021, within the applicable cut off time of 3 pm.
Nippon India MF has said that the minimum corpus requirement to carry out the rollover of the scheme will be Rs. 10 crore. AUM of this scheme stands at around Rs 335 crore. In case the scheme fails to maintain this minimum corpus amount at the time of rollover, it will not be rolled over. All the units outstanding will be redeemed and proceeds will be paid to the investors.
