Both fund houses have simplified the scheme’s name to make is easier for investors to understand the fund.
Birla Sun Life and ICICI Prudential announced the launch of Rajiv Gandhi Equity Savings Scheme (RGESS). Both fund houses have rechristened the fund’s name by dropping RGESS from the product name.
ICICI Prudential’s fund which complies with RGESS rules is called ICICI Equity Savings Fund – Series 1 while Birla Sun Life’s fund is named as Birla Sun Life Focused Equity Series 1.
Instead of using RGESS, both the fund houses have decided keep their name simple so as to make it easier for investors to understand the fund since many investors don’t know about RGESS.
The NFO of ICICI Equity Saving Fund Series 1 will open for subscription on January 20 and close on February 07 while the NFO of Birla Sun Life Focused Equity Series 1 is currently open and will close on February 13.
ICICI Equity Savings Fund Series 1 is a three-year closed ended fund which aims to generate capital appreciation from a portfolio of equity securities which are specified as eligible securities for RGESS. The fund will be benchmarked against CNX 100 Index. Manish Gunwani and Venkatesh Sanjeevi will co-manage the fund. The fund will focus on 20-25 stocks which are likely to see expansion in Return on Equity (ROE) over the next 3 years.
In a press release, Nimesh Shah, MD & CEO, ICICI Prudential MF said, “The Indian economy with its latest macro indicators has been going through a rough patch causing equity markets, in general, and some very good quality, large companies, in particular, to be shunned by investors. These companies could be ones which are best poised for a bounce-back at the first sight of an improving economy. Such companies with an outlook for improving profits or Return on Equity (ROE) are expected to be good investment opportunities in today’s tough environment.”
Birla Sun Life Focused Equity Fund - Series 1, a 3 year close ended RGESS fund, focuses on creating value by investing in shares of handpicked companies from BSE 100, CNX 100 and PSU Navratnas, Maharatnas and Miniratnas. The scheme will also be benchmarked against CNX 100. Anil Shah will manage the fund. The scheme would follow a blend of bottom up approach (for stock selection) and top down approach (for sector allocation). The fund manager would primarily focus on long term growth for identifying stocks. The objective would be to identify business with superior growth prospects and strong management available at reasonable valuation and offering higher risk adjusted returns.
Not many fund houses are planning to launch RGESS this year due to the complex structure of the fund.
