Franklin Templeton hopes for increased investment

KOLKATA: Franklin Templeton Investments (India), the fifth-largest fund house in India, thinks its just a matter of time before Securities & Exchange Board India (Sebi) raises the annual overseas investment ceiling from the current $150 million by individual mutual fund houses.

Given the huge foreign exchange reserves of over $180 billion and the changing dynamics of Indian markets, its just a matter of time for Sebi to revise the ceiling upwards, claimed Franklin Templetons president Vivek Kudva on Tuesday. He was talking to reporters here at a press meet.

It is well known that Franklin Templeton Investments (India) has urged Sebi to consider raising the cap to $400 million from $150 million. If Sebi revises the norm, we will consider introducing an overseas fund.

This will allow us to offer investors a wider choice basket, Mr Kudva said. It may be noted that Sebi had in January 2007 raised the overall limit for investments in ADRs/GDRs/foreign securities by mutual fund companies to $3 billion from $2 billion. Incidentally, Franklin Templeton is also considering a new open-ended fund. It is finalising the entry load structure for the open-ended fund, Mr Kudva said.

He was in town to sign an MoU with United Bank of India, whereby the bank has now accepted to distribute Franklin's mutual funds. The mutual fund industry is growing fast in India and fixed income instruments are attracting nearly 75% of the new investments,_ he said. The fund house, which manages over Rs 23,900 crore of assets of some 20 lakh investors in India, had not offered any new fund over the last 18 to 24 months, Mr Kudva said.

US-based Franklin Templeton Investments is one of the largest financial services groups in the world with some $561 billion in assets under management globally.