Alliance Capital Asset Management India Ltd (ACAM), the Indian subsidiary of global investment advisor Alliance Capital Management LP (managing assets worth $265 billion), will launch its fourth open-ended scheme, Alliance Equity Fund, on August 17.
The new scheme would be a growth scheme and the funds would be invested primarily in stocks, said Samir Arora, Alliance's head for Asian emerging markets.
The issue closes on August 27. During the initial offer, there would be a minimum sales load of one per cent imposed on purchase of units, and for on-going subscription it would be between 1.5 per cent and 2.25 per cent. There is no exit load.
The sales load is a one-time charge which an investor pays at the time of entry into the scheme.
The sales load is used by the asset management company to sell, promote and market the units of the scheme.
"Alliance Equity Fund is a scheme that is ideally suited for investors seeking long term goals. Our target allocation will be 90 per cent for equity and 10 per cent in debt and money market securities," Arora said.
ACAM will provide full portfolio disclosure each quarter, and the net asset value (NAV) is calculated on daily basis. Subscription to the scheme would entail tax benefits under sections 54EA & 54EB, section 112 and section 80L.
Further, there is no tax deduction at source (TDS) on income up to Rs 10,000.
Arora said that the performance of two of Alliance Capital's schemes investing in equity has been impressive.
The Alliance 95 fund, a balanced scheme targeting 60 per cent in equity, has provided investors a return of 42 per cent in the past one year and an annualised return of 22.6 per cent since inception in February, 1995.
Similarly, Alliance Capital Tax Relief 96, a closed-end equity linked savings scheme, has returned 32.7 per cent in the past one year and an annualised return of 39.3 per cent since it was launched in April 1996.
The other two open-ended schemes are Alliance Liquid Income (a debt scheme) and Alliance Cash Manager (a short term debt scheme).
Meanwhile, Alliance Capital considers Indian stock markets cheapest and attractively priced in the south-east Asian region.
"We consider Indian stocks attractively priced compared to share price in countries like Indonesia, Thailand, and Malaysia,"Samir Arora further said.
Arora said management quality of Indian companies is better than those in the sub-continent and added that growth potential here is better than in other Asian countries.
"In this region, India is the only country which is overweight with Indonesia, Thailand and Malaysia in underweight category," he added.
