News Across Web - 10th March 2008

Indian Investments

To fab or not to fab...
Some conjecture that the government knows that there may not be a need to put in equity funds because there will not be private investments in India in fab. ...

Centre puts SWFs under the scanner
The Qatar Investment Authority is believed to be the next largest SWF with an estimated size of $60 billion. On the Indian side, other than the Prime ...

MNC offers Rs 1.36 cr at IIM placements
KOLKATA: Placement figures at the the Indian Institute of Management, Calcutta (IIM-C) seem to have dispelled fears of a global recession plaguing ...

Accruals, provisions and fair value
The confusing use of the term 'provisioning' in that context reflects the Indian practice of using the term 'provision' to also connote a reduction in the ...

No exposure to sub-prime credit market: PSBs
Since these are issued on behalf of established Indian corporates, these are secure investments to a large extent," Indian Banks Association Chairman and ...

India, Japan trade to touch $15 bn by 2010
Trade between India and Japan is poised to double by 2010 from the current $7.5 billion, according to the Confederation of Indian Industry (CII). ...

 

Indian Mutual Funds,

V. PHANI KUMAR'S THIS WEEK IN INDIA Sensex decoupling closer than ever
Furthermore, mutual funds and individual investors are believed to be sitting pretty on the sidelines with piles of cash, waiting for an opportune moment to ...

India framing 'investment law for real estate trusts'
Asked to pick up a "good investment tool" for average NRIs, he said, "Mutual funds are a safer bet for them. Mutual funds are less risky. In India they are ...

To avoid stock market volatility, should I try an index fund?
They also can be more tax-efficient, since there is less turnover in their investment targets than in most mutual funds. Let members of the Financial ...

Spanish co scouting for PSB partner to form JV
"We plan to enter the Indian mutual funds market through a joint venture with a PSB, most likely this year. We are in talks with two banks," BBVA's Asia ...

SEBI to reduce time lag between opening of an issue and listing
Sebi chairman CB Bhave told reporters after a board meeting in New Delhi that the fees payable by mutual funds, custodians and those who file offer ...

 

Indian Markets

Bang Overseas looks to the Indian market for its next phase of growth
The new partner is expected to help grow Thomas Scott in India apart from giving it an entry into its already established European and American markets. ...

Domestic market will drive future growth
How do globally successful firms extend in their success to the Indian markets? I would like to describe three key aspects that firms need to address to be ...

Emerging markets likely to grow
I believe foreign trade is going to slow down and it will have an impact on emerging markets like India and China. Though I don't believe yet that emerging ...

Market wipes off over $20 bn from 10 richest Indians' groups
After March five, when the list was published, there has been just one day of trading in Indian stock market - March 7, while the global markets have traded ...

 

India insurance

Terror insurance gaining ground in UP
Besides Oriental and New India, National Insurance Company and United India Insurance too, came out with such policies. The owners of the establishments who ...

Son of Indian immigrants a rising Republican star
Born in Baton Rouge in 1971 to recent immigrants from India's northern Punjab state, Jindal's career in this southern state once known for deep racial ...

TVS launches its first three-wheeler
TVS Motor has also tied up with general insurance companies United India Insurance, New India Assurance and National Assurance Company for free health cover ...

Kotak Life plans health product
Kotak Life Insurance which now has 110 branches in India is also targeting to expand its pan-India network to over 200 branches by March 2009", Patil added. ...

SC on Vinayaga case: Duty would depend on registration certificates
The Supreme Court last week upheld the judgment of the Bombay High Court in the case of Rexnord Electronics and Controls Ltd vs Union of India, ...

ING Vysya launches retirement solutions in Valley
The pension schemes launched by the different insurance and the financial companies in India are a business in vogue these days. "Savings for the retirement ...

SBI opens 10000th branch
The bank plans to open at least 2000 branches in rural India in the next two years. 10000th branch: The Union Finance Minister, Mr P. Chidambaram, ...

Spain's BBVA explores JV plans with India's public sector banks
credit cards and later, life insurance. "We plan to enter the Indian mutual funds market through a joint venture with a PSB, most likely this year. ...

SBI joins Chinese bank to touch 10000 branches
Public sector State Bank of India on Sunday became only the second bank in the world to have 10000 branches when ...

CVC recommends prosecution of 18 govt officers
... four from Department of Fertilisers, one each from Department of Telecommunications, MTNL and United India Insurance Company be prosecuted. ...

 

Indian Financial; Markets

Oil price hikes set off oil bond purchases – Indian financial expert
Speaking further Thorat said that in the past the development of the money market in India was hindered by the system of administrated interest rates, ...

Keeping turmoil out of markets
.. level of foreign exchange reserves and confidence level of foreign financial markets, have demonstrated the resilience of the Indian capital market. ...

If New York sneezes...
Still, even though the Sensex has dropped by 23 per cent from its peak level two months ago, and though the market plunged through last week, the Indian ...

Gold markets likely to witness volatility
Also, increased volatility in the world financial markets and a possible recession in the US economy could boost flight to quality buying in gold, ...

Decoupled or shackled together?
In other words, India's real economy can and is decoupled from a slowing US. But the financial markets are not. Perceptions of risk general, ...

India's SBI considering Malaysian ringgit bonds
The tenure and interest rate of the bond would be determined by the market, he said, adding that borrowing a smaller amount would not be cost effective, ...

Mostly losers in casino capitalism
"Market fundamentalism emerged as the dominant ideology in the 1980s, when financial markets started to become globalised and the US started to run a ...

Kuwait's Noor eyes energy firms in India, Singapore
Marri also said that Noor is the financial adviser for a consortium led by Kuwait's Ikarus Petroleum to buy 10 percent of a petrochemical company in ...

Safe haven
It is also successfully capturing the changing demographics in the Indian economy by way of its foray into high-end skin-care market viz., opening of Kaya ...

 

India Tax

IMF Nods to Spending Spree by Asian Countries Hit by US Slump
In India, tax collections have more than doubled since Prime Minister Manmohan Singh's government came to power in 2004. China's tax revenue climbed 31 ...

Pros likely to be allow to float VCFs in the future
In India, VCFs can be structured in such a way that they can function as tax-transparent entities, where original investors pay tax and not the fund's trust ...

Nanda, IT officer, CA arrested
The three others arrested include his son Sanjeev Nanda who is the key-accused in BMW hit-and-run case, deputy director (investigation) income tax ...

Industry welcomes tax cut on turbine fuel
For those in many parts of India, going to Singapore and Malaysia on a weekly tour package works out cheaper than opting for a holiday to a destination in ...

Tax tweak hurts RIL, spooks sensex
.. in India and the top-weighted stock in the 30-share sensex – could see its valuations plummet if the finance ministry fails to clear the air on a tax ...

Fringe Benefit Tax on ESOPs growing steadily
India Inc reacted with disappointment to the Finance Minister's sidelining of the FBT issue on ESOPs in this year's Budget. Several corporations, especially ...

Traders edgy over advance tax, Re may dip
Liquidity has been comfortable following the government expenditure, resulting in the central government's deposits with the Reserve Bank of India (RBI) ...

NRIs want tax rebates for donating to projects
.. terms of tax rebates to donors. "Indo-Canadian Friendship Society of British Columbia and its sister organisation India-Canada Village Improvement Trust ...

CBI arrests arms dealer Suresh Nanda
They were arrested in Mumbai on Saturday night by the investigative agency after registering a case against Nandas, Income Tax Deputy Director Ashutosh ...

India's climate change policy a hot topic Carbon footprints ...
It has had mixed success: On Friday the government announced tax cuts on buses, as well as on small cars and motorcycles. Others have called for stepped-up ...

 

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Latest Dividend Report

Declaration of dividend under Reliance Vision Fund, Reliance NRI Equity Fund, and Reliance Interval Fund" for the record date of 14th, March 2008, which was published yesterday - March 9, 2008 in Financial Express & Nav Shakti.

Dividend Details are as below.

Upcoming / Declared Dividends
Diversified Equity Funds	Dividend	Record Date	Div.Yield (%)
Reliance Vision Fund	70%	14-Mar-08	12.64
Reliance NRI Equity Fund	15%	14-Mar-08	6.62
Kotak Opportunities Fund	20%	14-Mar-08	11.14
Franklin India Flexi Cap Fund	30%	12-Mar-08	16.18
Tata Infrastructure Fund	10%	11-Mar-08	4.05

Note: Dividend Yields for upcoming dividends are calculated with the NAV as on 5th March, 2008.

Mutual Fund – Transact Online            Invest in Mutual Fund - Offline

Investorline

indiainsured@aol.com

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Corporate announcements 9th March 2008

ABAN OFFSHO - 08 Mar 2008- Aban Offshore to raise funds Board meeting on 08 March 2008 The board meeting of Aban Offshore will be held on 08 March 2008 to consider the agenda item regarding raising of funds through issue of non-convertible cumulative redeemable preference shares on private placement basis.The company made this announcement during the trading hours today, 07 March 2008.       

 

ALLCARGO GLO - 08 Mar 2008 - Allcargo Global Logistics to appoint director EGM on 19 March 2008 The extraordinary general meeting of Allcargo Global Logistics will be held on 19 March 2008 to appoint Umesh Shetty as whole-time director of the company, for a period commencing from 01 February 2008 to 30 June 2011 and to offer, issue and allot on a preferential basis by way of a private placement.       

 

BHARAT FERTI - 08 Mar 2008 - Bharat Fertiliser Industries to change its name Board meeting on 17 March 2008 The board meeting of Bharat Fertiliser Industries will be held on 17 March 2008 to consider change in the name of the company from Bharat Fertiliser Industries to Bharat Fertiliser And Realty Industry.        

  

CONTI.CONTRL - 08 Mar 2008 -    Continental Controls to consider scheme of arrangement Board meeting on 14 March 2008 The board meeting of Continental Controls will be held on 14 March 2008 to consider and approve the scheme of arrangement between the company and Quest Softech (India) and their respective shareholders for demerger of the company by transfer of its software services division undertaking to Quest Softech (India).

 

DAIKAFFIL CH - 08 Mar 2008 - Daikaffil Chemicals India to convene board meeting On 14 March 2008 The board meeting of Daikaffil Chemicals India will be held on 14 March 2008 to approve draft notice for approval of special resolution by way of postal ballot and appoint Dinesh Kumar Deora, company secretary as scrutinizer.         

 

ENGINRS.(I) - 08 Mar 2008 - Engineers India's director resigns From the board Engineers India has announced that Prabh Das, joint secretary, Ministry of petroleum & natural gas has tendered his resignation, with immediate effect, from the company's board and sub-committee vide his letter dated 05 March 2008.The company made this announcement during the trading hours today, 07 March 2008.       

 

FILMCITY MED - 08 Mar 2008 - Filmcity Media to increase authorised capital EGM on 31 March 2008 The extraordinary general meeting of Filmcity Media will be held on 31 March 2008 to increase the authorised share capital of the company from Rs 11,00,00,000 to Rs 30,00,00,000.           

 

GARNET INTL - 08 Mar 2008 - Garnet International receives work order from ARSS Infrastructure Projects Worth Rs 38042674 Garnet International has got a work order from ARSS Infrastructure Projects for improvement to Nayagarh - Jagannathprasad - Bhanjanagar Road (SH-21) from 62/000 to 70/000 km under Central road fund for 2007-O8 of Rs 38042674.The company made this announcement after the trading hours on Friday, 07 March 2008.      

 

GUFIC BIO SC - 08 Mar 2008 - Gufic Biosciences declares dividend Of 5% The board of Gufic Biosciences has declared dividend at the rate of 5%.This was declared at the board meeting held on 07 March 2008.   

 

HCL TECHNO 08 - Mar 2008 - HCL Technologies ranks world's best performing infrastructure service provider Survey conducted by global services magazine in association with Neo IT HCL Technologies has been ranked #1 infrastructure service provider in the world by the global services 100 survey conducted by global services magazine in association with Neo IT, a leading global outsourcing advisory firm.HCL Technologies took the spot in this survey; ahead of global majors a trend which it has consistently followed having recently taken the top slot in another globally respected survey by Brown & Wilson group where of the 276 qualified global vendors who qualified HCL was ranked No.1.The global services 100 survey ascribed HCL's leadership in the infrastructure services space to it being one of the early providers of RIM as a service offering. Having started off with offering a co-sourcing type of engagement years back. HCL continues its leadership position in RIM with a bevy of customers that include fortune 500 and global 2000 companies, the report reads.The survey enlists the top 100 global IT and BPO service providers covering a range of services including IT application services, infrastructure, FAO, HRO and contact centers. The top 100 list and the ranks in the 10 categories are based on scientific methodology, starting with the responses being clubbed under four broad buckets: size; customers; skills and others. A weighted scoring scheme, designed by a panel of global services and neoITs practice experts was used to rate each question.HCL pioneered the concept of remote infrastructure management (RIM) with a co-sourcing model of engagement, which has added substantial value to customers including 70 + fortune 500 and Global 2000 enterprises. HCL created a new uncontested market space which today has become a leading trend. HCL is widely acknowledged as a pioneer and a leader in global delivery of infrastructure management. The company was cited as a leader in global IT infrastructure outsourcing in an independent vendor evaluation study by forrester wave TM, Q2, 2007 and No.1 specialty offshore infrastructure services provider by NeolT and managing offshore magazine. HCL has also been ranked as the world No. 1 in infrastructure outsourcing vendor by brown group for the black rook of outsourcing, 2007.The company made this announcement during the trading hours today, 07 March 2008.      

 

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Inclusive Growth - The Role of Banks in Emerging Economies

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Inclusive Growth - The Role of Banks in Emerging Economies

('Independence Commemoration Lecture, 2008' delivered by Deputy Governor, Smt. Usha Thorat at Central Bank of Sri Lanka, Colombo on February 28, 2008.)

Ladies and Gentlemen,

I am delighted to be here in Colombo and honoured by the invitation of the Central Bank of Sri Lanka to deliver this year's 'Independence Commemoration Lecture'. It is my proud privilege to join the illustrious list of previous speakers, who have added laurels to this prestigious lecture series. Today, I would like to share with you India's experiences on 'Inclusive Growth' - a topic which is both current and close to the hearts of public policymakers and central bankers of emerging economies.

Having chosen my topic, I am faced with the, not so unusual, speaker's dilemma as to from where I should begin. And I thought it is best to begin at the very beginning – some three millennia ago. Yes, some three millennia ago!! I refer to the 'Shanti Mantra' – a peace hymn – from the 'Kato Upanishad' of the Hindu scriptures which runs like this:

"Om Sahana Vavatu Sahanau Bhunaktu, Saha Viryam Karawavahai, Tejasvinavaditamastu, Ma Vidvishavahai, Om Shanti hi Shanti hi Shanti hi"

and translates to:

"Together may we be protected, together may we be nourished, together may we work with great energy, may our journey together be brilliant and effective, may there be no bad feelings between us, Peace, Peace, Peace"

Indeed, the significance and importance of the 'inclusive' concept has been well recognised millennia ago.

Coming to current times, there is growing realisation that while the 'trickle down' effect of economic growth no doubt works, it takes too long a time and hence there is a need to focus on inclusive growth. "Inclusive growth", is a little more than just the benefits of growth being distributed equitably and evenly; it is the participation of all sections and regions of society in the growth story and their reaping the benefits of growth.

I. Why inclusive growth?

While it is quite evident that inclusive growth is imperative for achieving the equity objective, what is, perhaps, not so obvious is, why inclusive growth is now considered essential even to sustain the growth momentum.

First, in many of the emerging market economies, the major chunk of population is based in rural areas. Significant increase in demand for manufacturing and services sectors has to come from the rural population. The average monthly per capita consumption expenditure (MPCE) in urban areas in India is almost double that of rural areas. In some States, the disparities are even more glaring. Therefore, it is important to ensure that growth takes place in agriculture, allied sectors as also in secondary and services sectors in rural areas, and amongst urban poor to provide a growing market for the goods and services produced by the expanding corporate sector.

Second, from supply-side management, growth in agriculture is necessary in order to keep manufacturing prices under check, provide food security and keep inflation under control. Price stability is not merely important as an anti poverty measure but also as an instrument to ensure stable and sustained growth.

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Corporate News 9th March 2008

ICICI Bank - Allotment of equity shares under ESOS

ICICI Bank Ltd has informed that the Bank has allotted 12,495 equity shares of face value of Rs 10/- each on March 03, 2008 under the Employees Stock Option Scheme, 2000 (ESOS).

BoB to waive Rs 1000 cr farm loans

Kolkata: Country's major public sector lender Bank of Baroda (BoB) expects to waive Rs 1,000 crore farm loan in pursuance of the loan waiver scheme announced by the Finance Minister P Chidambaram in the budget. The finance minister in his budget speech promised to waive Rs 60,000 crore of agriculture loans to give relief to the farmers. The AMC venture would be with Pioneer Global Investment, part of the Italy's biggest bank, Unicredit. The foreign partner for life insurance would be UK-based Legal & General.

Satyam Computer Services allots equity shares

New Delhi:The committee of Satyam Computer Services has allotted 77,981 equity shares under stock option plans of the company through circular resolution on 06 March 2008.Consequent to the above allotment, the paid up share capital of the company has gone up from 670,210,086 equity shares of Rs 2 each aggregating Rs 1,340,420,172 to 670,288,067 equity shares of Rs 2/- each aggregating Rs 1,340,576,134.This was approved by the committee of directors on 07 March 2008.

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Market News 9th March 2008

Record date for India Nippon Electricals second interim dividend is 26 March 2008

India Nippon Electricals has fixed 26 March 2008 as the record date for the purpose of payment of second interim dividend.

The company made this announcement after the trading hours on Friday, 07 March 2008.

 

Kohinoor Broadcasting Corporation to issue & allot equity shares

The members of Kohinoor Broadcasting Corporation have accorded the board to offer, issue and allot up to 100,000,000 equity shares of Rs 10 each on private placement basis to person resident outside India, by way of GDRs/ADRs or FCCBs.

The members have accorded the board to increase the authorized share capital of the company from Rs 1160000000 divided in to 116000000 equity shares of 10 each to Rs 2200000000 divided into 220000000 equity shares of 10 each by addition of Rs 1040000000 divided into 104000000 equity shares of 10 each.

Further, the members have accorded the board to invest of an aggregate sum not exceeding Rs 200 crore by the company in the equity shares of the wholly owned subsidiaries of the company viz. Kohinoor Broadcasting Corporation FZE and other subsidiaries to be incorporated world wide notwithstanding that such investment together with the investment in all other bodies corporate may exceed 60% of the paid up capital and free reserves or 100% of its free reserves whichever is more. This was accorded at the extraordinary general meeting held on 04 March 2008.

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Industry News 9th March 2008 - More Indians benefited by the growing IT revolution

More Indians benefited by the growing IT revolution

If government contention is to be believed, since the advent of the 21st century, the telecom and IT revolution has raised 290 million Indians above the poverty line, and about 15 to 20 million poor rise to join the ranks of the middle class every year. This is roughly equal to the total population of Australia. According to Ashwani Kumar, Union Minister of State for Industry, who was speaking at a conference on communications convergence by the Indian Merchant Chambers, by 2011, nearly 58 per cent of the rural population and about 95 per cent of urban people will be using mobile phones to conduct their businesses.

Nearly 80 million phones are purchased every year as against 15 million bicycles, indicating that India's people are using mobiles rather than bicycles to achieve connectivity, Kumar said. The robustness of this sector is so immense that if the present growth trends continue, India's import bill for electronics will exceed its oil import bill by 2050, he said. Kumar, however, admitted that there was a tremendous deficit in India's capabilities for manufacturing IT and communications hardware. Also speaking on the occasion, Ashank Desai, Chairman, Mastek Ltd and former chairman of Nasscom said that poor physical infrastructure was choking growth of IT and communications. This included shortage of power, roads and telecom infrastructure in tier 2-3 cities, which could otherwise register massive growth in the IT and BPO sectors.

"There is also a need for convergence between ministries," Desai said, adding, "Otherwise, a lot of necessary policy measures will fall through the cracks between different ministries and departments, which are unable to track the rapid growth of technologies."

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Industry News 9th March 2008 - BPO Industry 9th March 2008

BPO Industry 9th March 2008

Sri Lanka lost many BPO opportunities due to inadequate English

Sri Lanka lost many opportunities for employment in BPO companies which did not come here due to lack of English educated young people. India gained in BPO employment and IT sector employment because there were sufficient English educated people within their country, said Deputy Chairman/Managing Director of Associated Motorways Tilak De Zoysa Mr. De Zoysa who is also member of the Monetary Board of Sri Lanka was addressing a ceremony to award scholarships to children of company employees who passed government grade 5 scholarship examination.

A Rs.1500/= per month scholarship from year 1 up to university entrance together with Rs 700,000/= insurance policy was also awarded to Ms V P Udari Niwansala Pathirana of Rambukpitiya, Nawalapitiya. Miss Pathirana's father died in a road accident on duty and she entered the year 1 class this year. Ms Dammika Priyangani Manike, the mother of Miss Pathirana received the award and the insurance policy from Deshabandu Tilak De Zoysa.

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UNION BUDGET 2008-09: IMPLICATIONS FOR THE INFORMATION TECHNOLOGY COMPANIES

BUDGET 2008-2009 IMPACT ON BPO/ITES

HIGHLIGHTS OF THE BUDGET VIS-A-VIS INFORMATION TECHNOLOGY SECTOR

DIRECTLY IMPACTING IT SECTOR

   1. No confirmation on the extension of the income tax exemption available to Companies /units registered as Software Technology Park Units ('STPs') beyond Financial Year 2008-09.

   2. Imposition of service tax on the software and related services and changes in the CENVAT Rules.

   3. Increase in the excise duty applicable on branded / packaged software from 8% to 12%.

   4. Changes in FBT related provisions.

   5. Issues related to income tax, service tax, etc.

 

INDIRECTLY IMPACTING THE IT SECTOR

   6. Significant increase in the personal income tax rates and slabs, which will benefit employees of IT corporates.

 

OUR DETAILED ANALYSIS

   1. LIKELY WITHDRAWAL OF SECTION 10B WITH EFFECT FROM APRIL 1, 2009:

• Belying expectations from the IT industry, the Budget does not talk about the extension of the tax exemption available to IT corporates operating as export oriented units registered under the Software Technology Parks of India. The tax exemption covering the export profits of STP units as laid down by Section 10B of the Income tax Act, 1961, is all set to expire on March 31, 2009. The tax holiday withdrawal would mean that the STP units/companies would be required to pay tax in respect of Financial Year 2009-10 and onwards.

• Under the current scheme of things in the Income tax law, there is no tax exemption for software exporters who do not operate as STP units or SEZ units and consequently, the withdrawal of the tax holiday would not impact the non-STP/SEZ IT exporters, including software exporters.

• With effect from April 1, 2007, i.e. the current financial year, Minimum Alternate Tax ('MAT') has already been imposed on STP Units. MAT is payable on a company's Book Profits @ 10% plus Surcharge plus Education Cess of 3%. At the highest level, the MAT would work out to 11.33%. All STP Units are required to pay MAT on their book profits and this will continue into the next year and subsequent years. Fortunately, there has been no change in the MAT rate. Of course, the MAT payment made by the STP units is adjustable against their' future years' normal tax payments and this adjustment is available for a period of seven years.

STP UNITS VIS-A-VIS SEZ UNITS :

• The tax exemption given to the IT exporting units located in Special Economic Zones, under Section 10AA of the Income tax Act, continues. Very briefly, tax exemption is available for a period of 15 years from the year in which the SEZ unit is set up, without any sunset clause. Thus, if an exporting unit is set up in an SEZ area in 2015, it would still be entitled to tax exemption for 15 years starting from 2015-2016. Apart from the tax exemption under Section 10AA, SEZ units are not liable to pay MAT. This apart, there are several other fiscal incentives including non-imposition of service tax, etc.

Moving to an SEZ area would be essential for IT corporates, to be able to avail of the tax exemption beyond 2008-2009. We could thus see a scramble for space in the SEZs, as we go into 2008-09. However, we must caution that IT STPs which are planning to move into SEZ units would need to ensure that they do not get caught by the restrictive conditions laid down in Section 10AA related to 'reconstruction of business' etc. in which case, tax exemptions under Section 10AA would be denied, despite having moved into an SEZ.

Many IT STPs have been set up in specific industrial or software or technology parks, which are not recognized as SEZs. All of these STPs would lose the tax holiday with effect from April 1, 2009.

 

2. IMPOSITION OF SERVICE TAX ON SOFTWARE SERVICES

Till now, software services were exempted from the payment of service tax. However, IT Enabled Services, BPO services, KPO services, etc. are already being subjected to service tax. The Budget 2008-09 has brought in software services within the service tax net. The following services falling under a new service called 'Information Technology Software Service' will come under the service tax net from the time the Finance Bill 2008 is notified.

      'Information Technology (IT) software service' includes

• Development (study, analysis, design and programming) of software.
• Adaptation, up-gradation, enhancement, implementation and other similar services in relation to IT software.
• Provision of advice and assistance on matters related to IT software, including:

•  Conducting feasibility studies on the implementation of a system,
• Providing specifications for a database design,
• Providing guidance and assistance during the start-up phase of a new system,
• Providing specifications to secure a database,
• Providing advice on proprietary IT software.
• Acquiring the right to use,-
• IT software for commercial exploitation including right to reproduce, distribute and sell,
• software components for the creation of and inclusion in other IT software products,
• IT software supplied electronically.

Software consists of carrier medium such as CD, Floppy and coded data. Softwares are categorized as "normal software" and "specific software". Normalised software is mass market product generally available in packaged form off the shelf in retail outlets. Specific software is tailored to the specific requirement of the customer and is known as customized software. Packaged software sold off the shelf, being treated as goods.

 

IT IS CLEAR THAT ALMOST ALL ACTIVITIES CONNECTED TO THE SOFTWARE SERVICES SECTOR INVOLVING DEVELOPMENT OF CUTSOMIZED SOFTWARE WOULD COME INTO THE SERVICE TAX NET.

• For exporters of software services / customized software, the imposition of service tax might afterall be a 'blessing in disguise', as they would be entitled to claim a refund of the service tax paid by them on their input services like rentals, etc., which they are not able to utilize against their output service tax liability. In the earlier scenario, since software services were considered 'exempted services', no service tax refund was possible.
• For IT STPs in the software space, the imposition of service tax would not make any difference vis-à-vis service tax payment to the Department, as export of any services is anyway exempted from payment of service tax under the Export of Services Rules, so long as the sale consideration is received in convertible foreign exchange and subject to fulfilment of certain other conditions.
• For exporters of IT Enabled Services etc. the imposition of service tax on software services will make no difference, as IT Enabled Services are already under the service tax net and there is no levy of service tax on exports, as aforesaid.
• There are significant changes in the Cenvat Credit Rules, 2004, which govern the availability of cenvat credit for service providers. The existing Rule 6(3) dealing with service providers who provide taxable and exempt services is proposed to be replaced with a new rule which talks about reversal of proportionate credit or payment of 8% service tax on the exempt services.
• In our opinion, with software services becoming taxable, we feel that almost the whole of the IT industry has now come into the service tax net. Of course, the levy of service tax will indeed affect players catering to the domestic market.

3. INCREASE IN THE EXCISE DUTY RATE ON PACKAGED/ BRANDED SOFTWARE

• The excise duty on branded / packaged software has been increased from 8% to 12%, with effect from March 1, 2008, vide Notification No. 12/2008 All 'off –the-shelf' software packages like TALLY are considered as 'packaged software' which is considered to be 'goods' for purposes of levy of excise duty and Value Added Tax. In addition to the excise duty @ 12%, VAT would be applicable @ 4% on sale of branded / packaged software.
• No service tax is applicable in respect of sale of branded/ packaged software. Similarly, no VAT or sales tax is applicable in the case of customized software services.

4. CHANGES RELATED TO FRINGE BENEFIT TAX

• In a major development which would hit most employees of IT corporates, the FBT exemption on 'paid vouchers' will henceforth be restricted only to expenditure on or payment thro' non-transferable pre-paid electronic meal cards usable only at eating joints or outlets, subject to fulfilment of conditions to be prescribed by the Central Board of Direct Taxes. Many IT Corporates follow the practice of paying a part of the remuneration of their employees thro' SODEXHO or similar transferable pre paid vouchers, which can be used by these employees for a variety of purposes at various joints and departmental stores. This practice is being plugged by the Department and henceforth, it would be only pre-paid electronic meal cards which would be exempted from FBT. The CBDT will specify the upper limits for these cards which cannot be transferred. Private sector banks like AXIS Bank are issuing these cards which will now have to be re-issued to fit into the new logic. Most IT corporates can expect this to impact the take home salaries of their employees as the amounts till now, paid thro' SODEXHO or similar vouchers, would henceforth have to suffer FBT.

• THE FBT related provisions are being amended to provide that the following payments shall not be considered for FBT levy, viz.

1.      Payment which fulfils any statutory obligation

2.      Payment which mitigates occupational hazards

3.      Providing first aid facilities

4.      Providing crèche facility for the children of employees

5.      Sponsoring a sportsman, being an employee

6.      Organizing sports events for employees

Given the wide reach of FBT, we would strongly advise our clients to take care of whatever exemptions that have been specified. For instance, it's a common practice for IT companies to take their employees out, for picnics / get-togethers. They are advised to have some sports event (including tug-of-war games, in a lighter vein) based on which they can avail of the aforesaid exemption.

• The FBT rate on Festival Celebrations has been reduced from 50% to 20%.
• It has been clarified that maintenance of any accommodation in the nature of a guest house other than accommodation used for training purposes, would be exempted from FBT.
• Levy of FBT on ESOPs, introduced in the 2007-08 Budget, continues. FBT on other items also continues.

 

5. ISSUES RELATED TO INCOME TAX ETC

• The Income tax returns and Fringe Benefit tax returns would now have to be filed on or before September 30, 2008 in respect of 2007-08, INSTEAD of on or before October 31, 2008. A similar procedure would have to be followed for the coming years, as well.
• All IT corporates would now need to plan their closure of accounts, audit and the filing of the Income tax returns in a more effective manner.
• There are no changes in the corporate income tax rates, surcharge rates, education cess rates and TDS rates.
• Weighted deduction of 125% is now available to payments made to companies engaged in research and development.
• Banking Cash Transaction Tax (BCTT) is withdrawn.
• A Parent company is now allowed to set off dividend received from its subsidiary company against the dividend distributed by the parent company, for purposes of payment of Dividend Distribution tax. This is a good move which will eliminate double taxation of the same element of dividends. There is no change in the position that dividends are exempt in the hands of the shareholders.
• Section 40A(3) disallowance for cash payments is now being modified to cover all transactions within a day to the same party, upto an amount of Rs 20,000/- .
• Amount of deferred tax and the provision thereof and interest charged under the Income-tax Act will now be added to the net profit to find out the 'book profit' for levy of Minimum Alternate Tax, with retrospective effect from the assessment year 2001-02.
• TDS certificates in the physical format will continue till March 31, 2010.
• The initial / threshold exemption limit for service tax payers has been increased from Rs 8 lakhs to Rs 10 lakhs. Consequently, it becomes compulsory for a service provider to obtain registration, if the value of taxable services provided by him exceeds Rs 9 lakhs.

 

6. CHANGES IN THE PERSONAL INCOME TAX FRONT

Contrary to the dismal outlook for IT corporates vis-à-vis this Budget, there is a lot of good news for employees on the personal taxation front. These are briefly summarized below:

• The threshold limit of exemption raised. In the case of all assessees, from Rs. 110,000 to Rs. 150,000. In the case of women assessees, from Rs.145,000 to Rs. 180,000 and in the case of senior citizen, from Rs. 195,000 to Rs. 225,000; The four slabs and rates will be as follows : Up to Rs. 150,000 Nil; Rs.150,001 to Rs. 300,000 10 per cent; Rs. 300,001 to Rs. 500,000 20 per cent; Rs. 500,001and above 30 per cent.
• The Senior Citizens Savings Scheme, 2004 andthe Post Office Time Deposit Account added to the basket of saving instruments under Section 80-C.
• Additional deduction of Rs. 15,000 under section 80D to a individual who pays medical insurance premium for his/her parent or parents.
• The rate of tax on short term capital gains under Section 111A and Section 115AD raised to 15% from 10%.
• For the sake of easier understanding, we have compiled a table showing the pre and post Budget income tax liability for individuals.

 

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Gold resumes at an all-time high of Rs 12,885 - Economy News 9th March 2008

Gold resumes at an all-time high of Rs 12,885

Gold prices resumed at an all-time high of Rs 12,885 in the bullion market here on March 7 on fresh stockists buying in view of rising trend in the global markets. Silver also crossed Rs 25,000-mark on good industrial demand. Some of the investors shifted their funds in bullion due to fall in equity market, traders said. Standard gold (99.5 purity) rose by Rs 300 per ten grams to Rs 12,885 from the Wednesday's closing level of Rs 12,585. Pure gold (99.9 purity) also rose to Rs 12,940 from Rs 12,635 previously.

Silver ready (.999 fineness) shot up by Rs 1,000 per kilo to Rs 25,100 from Rs 24,100. In New York, gold futures roared to record highs and silver to a 27-year peak on Wednesday as crude skyrocketed following a decline in the US oil inventories, leaving the metals market focused on the possibility of hitting the long-talked-about level of $1,000 in gold.

Most-active April gold hit a life-of-contract high of $995.20 an ounce on the Comex division of the New York Mercantile Exchange, while May silver hit a contract high of $20.97 an ounce.

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Inflation rises to 5.02% - Economy News 9th March 2008

Inflation rises to 5.02%

Reserve Bank of India (RBI) Governor YV Reddy's decision to keep interest rates unchanged has once again been vindicated, with inflation rising to a 10-month high. Rising global prices of food and oil have pushed inflation levels back above the 5 per cent mark for the first time since May of last year. Inflation for the week ended February 23 came in at 5.02 per cent compared to 4.89 per cent, the week before. A bulk of the increase came from the primary articles index, which rose to 6.28 per cent versus 4.89 per cent in the previous week. The food index rose 4.8 per cent versus 2.98 per cent the week before.

The unexpected rise in inflation levels above 5 per cent comes due to soaring global food prices. This factor is likely to continue putting pressure on prices over the next weeks. Analysts now expect inflation levels to remain above 5 per cent over the next few months. The rise in inflation came at a time when signs of slowing GDP growth are also intensifying. The government estimates that GDP growth will slip below 9 per cent in the current financial year. Slowing growth in industrial production and weakness in consumer driven sectors drive it. This weakness has led to calls from policy makers and industrialists to lower interest rates to help support the economy's growth momentum. But with inflation now back up above the RBI's target of 5 per cent, it seems increasingly unlikely that the RBI would be willing to cut rates anytime soon. Currently, there are acute policy dilemmas arising from global food and energy prices that need to be factored-in in evolving appropriate policy responses, said YV REDDY, Governor, RBI.Even the government accepts that inflation will remain above 5% in the short term. This indicates that high interest rates will continue to be a reality for months to come.

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Rupee hits nearly six-month low - Economy News 9th March 2008

Rupee hits nearly six-month low

Continuing its weakness after a brief pause, the Indian rupee hit a nearly six-month low of 40.52/53 against the greenback on March 7 on good dollar demand from banks and oil companies amidst the softening of US currency and sluggish stock markets. The Indian unit has not seen this level since September 17, 2007 after resuming weak at 40.37/39 a dollar compared to its last close of 40.29/30 a dollar. Earlier last month, the rupee had breached the 40-mark level against the dollar for the first time in five months.

The domestic currency has depreciated after gaining by about eight paise in the last two sessions. Forex dealers said banks and oil refiners bought dollars even as Asian stocks fell to their recent lows after global oil prices held near record highs keeping overall pressure on dollar. Meanwhile, the Indian benchmark Sensex tumbled by more than 560 points, or 3.42 per cent while Asian indices dipped by about 1.0 to 3.0 per cent in early trade.

The Reserve Bank also fixed the reference rate for dollar at Rs 40.53 and for the single European unit at Rs 62.40 per euro. The rupee premiums on forward dollar ended sharply higher due to paying pressure from banks and corporates. The benchmark six-month forward dollar premiums payable in August ended at 5-1/2 - 7-1/2 paise, up from 2-1/2 - one paisa discount on Wednesday and Far-forward maturing in February closed remarkably higher at 17-1/2 - 19-1/2 paise from 8 - 10 paise previously. In cross-currency trades, the rupee also weakened against the British sterling, the euro and the yen.

The rupee tumbled against the sterling and ended the day at Rs 81.57/59 per euro from its last close of Rs 79.74/76 per pound and also fell sharply against the Single European currency to Rs 62.42/44 per euro from its previous close of Rs 61.17/19 per euro. The local currency dipped against the Japanese Yen to close at Rs 39.76/78 per 100 yen from Wednesday's close of Rs 38.88/90 per 100 yen.

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Mutual funds - upcoming Dividends announced by MFs- 9th March 2008

ING MF declares dividend under FMP Series

ING India Mutual Fund has announced 12 March 2008 as the record date for declaration of dividend under dividend option of ING Fixed Maturity Plan - Series XXVI. The AMC plans to distribute entire appreciation in the NAV of dividend option from the date of allotment to 12 March 2008 as dividend. The NAV under the scheme is Rs 10.2159 as on 4 March 2008. ING Fixed Maturity Plan - Series XXVI is a close -ended scheme offering an investment plan of 92 days maturity, investing in a portfolio of government securities or highly rated corporate bonds maturing close to maturity of the scheme so as to generate returns comparable with alternative fixed-income instruments of similar maturity. The scheme will invest in debt securities so as to minimise the impact of price fluctuation of such securities and the value at maturity.

         

Franklin Templeton MF declares tax-free dividend

Franklin Templeton Mutual Fund has approved the declaration of tax-free dividend under the Franklin India Flexi Cap Fund. The AMC plans to distribute 30% of distributable surplus i.e. Rs 3.00 per unit on the face value of Rs 10 as on record date.

The record date for the dividend is 12 March 2008 and any purchases on or before this date will be eligible for the dividend. There will be a one-day book closure for the growth and dividend plans in the respective funds on 13 March 2008 and will reopen for fresh purchases and redemptions on 14 March 2008. Under the dividend reinvestment plan, the dividend declared will be reinvested in the fund at the NAV of 14 March 2008 and unit holders will be allotted additional units for the dividend amount. Franklin India Flexi Cap Fund was launched in March 2005 as an open-ended equity scheme. Franklin India Flexi Cap Fund is an open-end diversified equity fund that seeks to provide medium to long-term capital appreciation by investing in stocks across the entire market capitalization range.

         

Franklin Templeton MF declares dividend

Franklin Templeton Mutual Fund has announced the declaration of dividend for Templeton Fixed Tenure Fund-Series IV-60 Months Plan. The record date is set as 12 March 2008. The AMC plans to distribute 7% of distributable surplus i.e. Rs 0.70 per unit on the face value of Rs 10 as on record date. Templeton Fixed Tenure Fund-Series IV-60 Months Plan is an open-ended diversified equity fund that seeks to provide investors steady returns along with capital appreciation through equity exposure.

 

HSBC MF declares dividend

HSBC Mutual Fund has announced 11 March 2008 as the record date for declaration of dividend under dividend option of HDFC Interval Fund-Plan II. The fund house has decided to distribute 100% of surplus available under its both regular and institutional plans as on record date. The NAV for the scheme under regular option was Rs. 10.2077 and under institutional option NAV was Rs 10.2125 as on 5 March 2008.

HSBC Interval Fund-Plan II is a debt oriented interval scheme, seeks to generate returns by investing in a portfolio of fixed income instruments normally maturing in line with the time profile of the respective plan.

 

Fidelity MF declares dividend for equity schemes

Fidelity Mutual Fund has announced 13 March 2008 as the record date for declaration of dividend under dividend option of Fidelity Equity Fund and Fidelity Tax Advantage Fund.

Fidelity Mutual Fund has announced a dividend of 25% i.e. Rs 2.50 per unit on the face value of Rs 10 in its Fidelity Equity Fund, an open-ended growth scheme. The investment objective of the scheme is to generate long term capital growth from a diversified portfolio of predominantly equity and equity related securities.

The AMC have also announced a dividend 15% i.e. Rs 1.50 per unit on the face value of Rs 10 in its Fidelity Tax Advantage Fund, an open ended equity linked saving schemes with an objective to generate long term capital growth from a diversified portfolio of predominantly equity and equity related securities.

The record date for the dividends is 13 March 2008. The NAV as on 5 March 2008, of Fidelity Equity Fund was Rs Rs 19.781 and under dividend option of Fidelity Tax Advantage Fund was Rs 15.613.

More Dividends - 7th March 2008  6th March 2008  5th March 2008  4th March 2008   &   Go to Dividends category        

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Mutual Funds News - 09th March 2008 - New Schemes Rolled out - NFO

JM Financial MF rolls out FMP Series

JM Financial MF has unveiled a fund called JM Fixed Maturity Fund - Series IX - 15 Month Plan and it is a close-ended income fund with maturity of 455 days from the date of allotment. The investment objective of the fund is to generate regular returns through investments in fixed income securities normally maturing in line with the time profile of the respective plan.

      

133 Equity mutual funds outperformed Sensex

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Equity mutual funds as a class posted an average return of 31.71%, outperforming the Sensex return of 30.28%, over the one-year period ended 5 March 2008. Of the 257 equity schemes, 122 exceeded the category average of 31.71% in the one-year period, while 133 outperformed the Sensex that is posted 30.28%. The topper was Reliance Diversified Power Sector (G) with 98.97% return.

In the equity category, the diversified categories and tax planning, and Mid cap outperformed the Sensex, giving a category average of 33.35%, 33.77and 30.32% respectively while FMCG under performed the Sensex by recording 23.93% category average during the same time period. In the equity diversified category, out of the 140 schemes, 65 exceeded the category average of 33.35%, while 78 outperformed the Sensex return of 30.28%, over the one-year period ended 5 March 2008. Stan Chart Premier Equity Fund with growth option ranked the first position, with 71.13% return, followed by Reliance Regular Savings Fund - Equity (G) with 70.14% return. DWS Investment Opportunity Fund (G) secures the third position with 67.00% in 1-year period.

 

DSP Merrill Lynch MF launches two FMP Series

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Name of Fund: DSP Merrill Lynch Fixed Maturity Plan 13 Months Series 1 and DSP Merrill Lynch Fixed Maturity Plan 3 Months Series 6

Scheme: Both the funds are close-ended income schemes.

Objective: The primary investment objective of both the schemes is to seek capital appreciation by investing in a portfolio of debt and money market securities. It is envisaged that the portfolio of each scheme will display a maturity profile that is generally in line with the term of the scheme. The schemes may also use fixed income derivatives for hedging and portfolio balancing.

Asset Allocation: Both funds will invest can invest up to 100% in debt instruments and up to 100% in money market. These schemes may invest up to a maximum of 100% of the schemes net assets in domestic securitised debt.

Fund Opens: 5 March 2008

Fund Closes: 11 March 2008

Face Value: Rs 10.

Investment Options: These schemes has two plans i.e. regular and institutional plan. Both plans will provide growth and dividend reinvest option.

Entry Load: There will no entry load charged for both the schemes due to its close-ended structure.

Exit Load: DSP Merrill Lynch FMP 13 Months Series 1 charges an exit load of 1.50%, if the investment is redeemed before the maturity date.

DSP Merrill Lynch FMP 3 Months Series 6- charges an exit load of 0.50%, if the investment is redeemed before the maturity date.

Minimum Investment Amount: The minimum investment amount under regular plan will be Rs. 25,000 and in multiples of Re. 1 thereafter for both the schemes. Both schemes will have the investment under institutional plan will be of Rs.1 crore and in multiples of Re. 1 thereafter.

Target Amount: Rs 10 crore

Benchmark Index:

For DSP Merrill Lynch Fixed Maturity Plan 13 Months Series 1- CRISIL Short Term Bond Fund Index

For DSP Merrill Lynch Fixed Maturity Plan 3 Months Series 6- CRISIL Liquid Fund Index

Fund Manager: Mr. Dhawal Dalal

 

 

ING MF launches ING Long Term FMP- 1

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Name of Fund: ING Long Term FMP- 1

Scheme: ING Long Term FMP- 1 is a close-ended bond scheme offering an investment plan of 393 days maturity. The scheme shall mature on 7 April 2009.

Objective: The scheme will be investing in a portfolio of government securities or highly rated corporate bonds maturing close to the maturity of the scheme so as to generate returns comparable with alternative fixed-income instruments of similar maturity. The scheme will invest in debt securities with maturity coinciding closely with the maturity of the scheme, so as to minimise the impact of price fluctuation of such securities on the value of the security at maturity.

Fund Opens: 5 March 2008

Fund closes: 10 March 2008

Face Value: Rs 10 per unit

Investment Options: The scheme provides two plans i.e. retail and institutional plan with a sub-option of growth and dividend option.

Asset allocation: The scheme shall invest up to 100% in debt securities and money market instruments including call money and reverse repo. The debt securities may include securitised debt up to 100% of the net assets. The investments in derivatives instruments shall be to a maximum of 50% of the net assets of the scheme.

Entry load: The scheme does not charge an entry load as it is of close-ended nature.

To provide liquidity to investors, the fund proposes to provide repurchase facility in the scheme on monthly basis. The investors can submit their repurchase requests at any official points of acceptance of transactions on any date after the allotment.

If repurchase request is submitted after the date of allotment and on or before 11 March to 8 June 2008 the applicable Contingent Deferred Sales Charge (CDSC) will be 4.00%. CDSC will be reduced to 3.00% if repurchase request is submitted from 8 June 2008 to 6 September 2008. If repurchase request is submitted after 6 September 2008 and on or before 5 December 2008, the applicable CDSC will come down to 2.00%. If repurchase request is submitted after 5 December 2008 and on or before 6 April 2009 the applicable CDSC will be further come down to 1.00%.

If repurchase request is submitted after 6 April 2009 and on 7 April 2009 (maturity) there will be no CDSC.

Minimum Investment Amount: The minimum investment amount under retail plan is Rs 5,000 and in multiple of Re 1 thereafter. Under institutional plan, the minimum investment amount is Rs 1 crore in multiple of Re 1 thereafter.

Minimum subscription amount: Rs 1 lakh

Benchmark index: CRISIL Liquid Fund Index

Fund Manager: Mr. Prashant Singh

 

Standard Chartered MF launches FMP

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Name of Fund: Standard Chartered Fixed Maturity Plans Yearly Series 19

Scheme: The scheme is close-ended income scheme.The scheme will have two plans Plan A and Plan B. The duration of the scheme will be from the date of allotment to 2 April 2009.

Objective: The investment objective of the scheme is to generate income by investing in a portfolio of debt and money market instruments normally in line with the duration of the scheme.

Asset Allocation: The fund will invest up to 100% in debt and money market instruments, with low to medium risk profile. The investment in securitised debt will be up to 50% of net asset of the scheme.

Fund Opens: 7 March 2008

Fund Closes: 14 March 2008

Face Value: Rs 10

Investment Options: The scheme provides dividend and growth options.

Entry Load: There will no entry load charged for the scheme due to its close-ended structure.

Exit Load: The scheme charges an exit load of 2.00%, if the investment is redeemed from the date of allotment to 2 April 2009. There will be no exit load charged on the redemption made on maturity.

Minimum Investment Amount: The minimum investment amount under plan A is Rs 5000 and in multiple of Re 1 thereafter. Under plan B, the minimum application amount is Rs 1 lakh and in multiple of Re 1 thereafter.

Minimum targeted amount: Rs 1 crore

Benchmark Index: Crisil Composite Bond Fund Index.

Fund Manager: Mr. Kaushal Singh

 

 

HDFC MF launches 13M and 90D March (2) plans under HDFC FMP -Series VII

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Name of fund: HDFC Fixed Maturity Plan 13 Months March 2008 (2) and HDFC Fixed Maturity Plan 90 Days March 2008 (2).

Scheme: Both the schemes are of close-ended income nature.

Objective: The investment objective of the fund is to generate regular income through investments in debt, money market instruments, and government securities.

Options: Both HDFC Fixed Maturity Plans- 13 Months March and 90 Days March 2008 (2) offers wholesale plan and retail plan with growth and dividend option.

The Minimum Investment Amount:

Under retail Plan: Rs. 5,000 and in multiple of Re. 1 thereafter per application

Under wholesale Plan: Rs. 1 Crore and in multiples of Re. 1 thereafter per application

Asset allocation:

Debt securities and money market instruments: 60-100%

Government securities: 0- 40%

Securitised debt: Up to 75% of net assets of plan

Snapshot

Face value: Rs 10

Offer opens: 12 March 2008

Offer closes: 17 March 2008

Entry load: Nil

Exit load: HDFC Fixed Maturity Plan 13 Months March 2008 (2) would charge an exit load of 2.00% if the units are redeemed or switched out before maturity.

HDFC Fixed Maturity Plan 90 Days March 2008 (2) may charge an 0.75% an exit load if the units are redeemed or switched out before maturity.

Benchmark Index: Crisil Liquid Fund Index

Fund Manager: Mr. Shobhit Mehrotra.

 

Standard Chartered MF launches another FMP

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Name of Fund: Standard Chartered Fixed Maturity Plans Yearly Series 18

Scheme: The scheme is close-ended income scheme. The scheme will have two plans Plan A and Plan B. The duration of the scheme will be from the date of allotment to 2 April 2009.

Objective: The investment objective of the scheme is to generate income by investing in a portfolio of debt and money market instruments normally in line with the duration of the scheme.

Asset Allocation: The fund will invest up to 100% in debt and money market instruments, with low to medium risk profile. The investment in securitised debt will be up to 50% of net asset of the scheme.

Fund Opens: 28 February 2008

Fund Closes: 21 March 2008

Face Value: Rs 10

Investment Options: The scheme provides dividend and growth options.

Entry Load: There will no entry load charged for the scheme due to its close-ended structure.

Exit Load: The scheme charges an exit load of 2.00%, if the investment is redeemed from the date of allotment to 2 April 2009. There will be no exit load charged on the redemption made on maturity.

Minimum Investment Amount: The minimum investment amount under plan A is Rs 5000 and in multiples of Re 1 thereafter. Under plan B, the minimum application amount is Rs 1 lakh and in multiples of Re 1 thereafter.

Minimum targeted amount: Rs 1 crore

Benchmark Index: Crisil Composite Bond Fund Index.

Fund Manager: Mr. Kaushal Singh

 

Lotus India MF files an offer document

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Name of Fund: Lotus India Fixed Maturity Plan - 3 Months Series XXIX to XXXII

Scheme: These are close-ended debt schemes. They will have maturity of 90 days from the date of allotment of the scheme.

Objective: The objective of the scheme is to seek to seek to generate income by investing in a portfolio of debt and money market instruments normally maturing in line with the duration of the scheme.

Asset Allocation: The fund will invest 0%-85% in money market instruments including reverse repo. The investment in government securities issued by the central government and/or state government(s) will be 0%-50%. The fund will invest 15%-100% debt instruments such as bonds and debentures. The investment in securitised debt will be up to 50%. The investment in fixed income derivatives will be up to 50% of the net assets of the scheme.

Face Value: Rs 10

Investment Options: Lotus India Fixed Maturity Plan - 3 Months Series XXIX to XXXII offers two options i.e. growth and dividend reinvestment options.

Entry Load: There will no entry load charged for schemes, as they are close-ended funds.

Exit Load: The scheme charges an exit load of 1%, if the investment is redeemed any time other than specified transaction period. Whereas there will be no exit load charged on the redemption made on specified transaction period.

Minimum Investment Amount: Minimum investment under the scheme is Rs 5,000 and in multiple of Re 1 thereafter.

Minimum subscription amount: Rs 1 crore

Benchmark Index: CRISIL Short Term Bond Fund Index.

Fund Manager: Mr. Umesh Sharma.

 

Mutual funds' selling continue

Mutual funds (MFs) sold shares worth a net Rs 280.10 crore on Wednesday, 5 March 2008, compared to their selling of Rs 151.40 crore on Tuesday, 4 March 2008. MFs' net outflow of Rs 280.10 crore on 5 March 2008 was a result of gross purchases of Rs 881.70 crore and gross sales Rs 1161.80 crore. The 30-share BSE Sensex rose 202.19 points or 1.24% at 16,542.08 on that day. MFs were net sellers of shares worth Rs 884.40 crore in this month, till 5 March 2008.

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