Franklin Asian Equity Fund raises India allocation

Mumbai: Franklin Asian Equity Fund will increase allocation to Indian equities given the strong India growth story, and also enable investors to get the benefit of long-term capital gains tax with indexation if they hold for more than three years. Franklin Asian Equity Fund, with assets of Rs 250 crore is an open-ended scheme, launched in 2008, that invests in undervalued companies in India and other Asian regions.

The scheme will now increase its allocation to Indian equities. As per the new structure, it will now allocate 35-45% to Indian equities, 45-65% to foreign securities of Asian companies (excluding Japan) and 0-20% to debt securities. This structure will make it eligible for debt taxation, where investors need to pay only 20% long-term capital gains tax with indexation benefits if they hold for more than three years, which significantly reduces tax liability.