Financial Daily from THE HINDU group of publications
Friday, Jan 06, 2006
Markets - New Fund Offer
Outlook for India remains positive: Fidelity
Equity-linked savings scheme launched
Ms Ashu Suyash, Country Head, Fidelity Fund Management, and Mr Arun Mehra, Fund Manager, Fidelity Tax Advantage Fund, at a press conference for the launch of Fidelity Tax Advantage Fund in Mumbai on Thursday. Paul Noronha
Mumbai , Jan. 5
GLOBAL fund house Fidelity is optimistic about the Indian equity markets, saying that its long-term outlook for India remains positive.
"The Indian equity story certainly calls for attention on its own merits and does not, in my view, need a wave to get noticed," said Mr Arun Mehra, Head of Investment Strategy, Fidelity India, and Fund Manager, Fidelity Equity Fund, during a presentation at the launch of an open ended equity linked savings scheme (ELSS) `Fidelity Tax Advantage Fund' here on Thursday.
Fidelity is the world's largest mutual fund manager with more than $ 1.2 trillion in assets under management.
Mr Mehra said in 2005 the Indian markets saw a broad-based rally across most sectors, which was supported by fairly robust earnings growth . "Few markets have seen genuinely broad-based market rallies, what we saw in India in 2005," he said.
He said India was among the few markets that witnessed strong and consistent earnings growth across most sectors in the last couple of years.
Drawing comparison with other markets, India was "different" since "we are not dependent on one or two themes that drive the markets."
"There are opportunities across number of themes and sectors," he said, adding, "It pays to focus on identifying individual opportunities."
"The growth story has been far more resilient than many other markets and I don't see that changing in a hurry," Mr Mehra said.
He said the Indian markets might stay volatile in the short term. The volatility may also be a good opportunity to enter the market. "Increased volatility is part of all markets," he pointed out.
"Our focus has always been and will continue to remain on identifying individual opportunities that we find attractively valued rather than trying to forecast where the market is headed," Mr Mehra said.
Commenting on the `Fidelity Tax Advantage Fund', Ms Ashu Suyush, Country Head of Fidelity's AMC in India, said Fidelity AMC was embarking on category-building and "hopes to make a difference to individual savings in the country."
The fund aims to generate long-term capital growth from a diversified portfolio of predominantly equity and equity-related securities.
It has a three-year lock-in period, Ms Suyush said.
ELSS funds offer investors the opportunity to save tax under Section 80C and what keeps them ahead of other tax saving options is their ability to harness the growth potential of equities.
The offer closes on January 31.
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