labels: franklin templeton investmests, investment - general
Franklin Templeton suspends fresh sales in Prima Fundnews
19 January 2006

Mumbai: Franklin Templeton Investments (India) has announced suspension of fresh sales in its open-end diversified equity fund - Franklin India Prima Fund (FIPF), which invests predominantly in the mid and small cap stocks. The suspension of sales will be with effect from 4 February 2006.

Sukumar Rajah, director and CIO, equity, Franklin Templeton India said that the judicious stock selection approach and the re-rating of the mid and small cap stocks in recent years, has resulted in the fund turning in a good performance (58.3 per cent growth over the last one year). The strong performance of the fund and the growing interest in the mid & small cap segments, have resulted in considerable inflows into the fund over the last few years, which has grown in size significantly from Rs633 crore in December 2003 to Rs2,226 crore in December 2005.

"Given the large fund size, we feel that it is prudent to cap fresh inflows until we are certain about the stability and liquidity levels in the mid/small cap segments. We believe that closing the fund for fresh inflows would help us in protecting the interests of the existing shareholders. Investors can however redeem their investments, at any time."

The principal portfolio manager for the fund - KN Sivasubramanian, Senior VP, equity, said, "This does not change our view on the longer term potential of mid/small cap companies and we continue to remain optimistic about the same, on account of the opportunities being thrown up by robust growth in the domestic economy and the global outsourcing trend. We will be reviewing the market conditions on a periodic basis and the closure period might be extended or reduced based on our views on the liquidity/valuation levels and investment opportunities."

The suspension of sales will be with effect from February 4, 2006 for a period of 6 months with the exception of Systematic Investments Plan (SIP)/ Systematic Transfer Plan (STP)/ Dividend Transfer Plan (DTP) and Fund of Funds (FOF) investments. The fund will continue to issue units to investors registered under the Dividend Re-investment Plan.

Franklin India Prima Fund was launched in December 1993 and currently manages over Rs.2226 crores of assets for over 167,000 investors. Since its inception, the scheme has been able to deliver consistent performance (see table).

  

Last
1 Year

Last
3 Years

Last
5 Years

Last
7 Years

Last 10 Years

Since
Inception

Prima Fund

58.31%

81.56%

54.63%

46.61%

29.00%

26.66%

S&P CNX 500

36.25%

47.08%

21.89%

22.06%

14.28%

9.25%

 


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Franklin Templeton suspends fresh sales in Prima Fund