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Our Bureau

Funds report busy fortnight ahead

Kolkata June 22 With about 15 fixed maturity plans closing in the next two weeks or so, there appears to be a marked effort by fund houses to peddle these products, the softening of indicative yields notwithstanding.

The FMP scenario is currently very active, with a number of players, including such large ones as UTI, HDFC and Franklin Templeton, trying to wrap up their offers. The last few days of the current month and the first week of July will be particularly significant on this count.

The latest crop of FMPs spans quite a range, sources in the funds industry say. The reference is to the wide array that includes 375-day plans (Lotus India), 90-day plans (HDFC), 18-month plans (ICICI Prudential) and so on.

Also included are the likes of UTI Fixed Income Interval Fund - Quarterly Plan 1, Birla Fixed Term Plan - Quarterly Series 19, ABN Amro Fixed Term Plan - Series 8 - Yearly Plan A, etc.

Documents filed

That fixed maturity products will continue to hold their sway is evident from the number of offer documents filed with the regulator. Among the proposals that have been lately sent to SEBI for approval are: Lotus India FMP (18, 24 and 36 month Series I - III), LIC FMP Series 31 - 33 and HSBC Fixed Term Series 35 - 40 and ING Vysya Fixed Maturity Fund Series XXIX - XXX.

Fund marketing executives claim that lower indicative yields will not entirely diminish FMPs' relative attraction, especially considering their tax efficiency.

This view stands in contrast to what is being suggested by some quarters - that fixed-maturity products are losing their appeal in comparison with bank deposits. Banks have lately increased rates on their deposit products.

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