Sun F & C Asset Management To Launch Clutch Of Products

Sun F&C Asset Management, a 50:50 joint venture between Foreign & Colonial Emerging Markets and Sun Securities, will introduce a clutch of products in this financial year which could include a fixed income fund and sectoral funds.

SunF&C will, within the next two weeks, launch an open-ended equity fund which will invest into 20-40 value stocks. The fund will have a minimum target of Rs 1 crore.The company has already received the Securities and Exchange Board of India (Sebi) approval for launching the fund. The fund will look into stocks which are illiquid and relatively cheap but show good upward potential and marginal downward risk, said Nikhil Khattau, chief executive officer, Sun F&C Asset Management.

 

The fund will be opened for fresh sales and repurchases for 15 days every three months. This structuring has been made to meet the redemption requirements since its investments may take little longer to sell and generate cash. There are pockets of value in the Indian capital market when we talk of value stocks. These include turnaround stocks, illiquid stocks which are not touched by the market, and public sector unit stocks.

Commenting on the move to launch an equity-linked fund, he said: We are not market timers. In the medium-term, as interest rates lower, equities are beginning to look favourable. The requirement for a fixed return through a debt instrument may well be behind us, he added. The no-load equity fund will announce a daily net asset value following recent Sebi directives.

Sun F&C was one of the earliest foreign institutional investors to enter the country in 1993. The company is also one of the oldest global investment banks managing $40 billion assets worldwide.

Sun F&C at present manages assets worth $300 million in India and had introduced an open-ended India Fund through a Luxembourg-based investment company. The fund currently has a size of $170 million.