New Delhi: With an aim to help investors and create a central data base, Sebi on Tuesday asked mutual funds to submit their final offer documents two days before the launch of a particular scheme as these would be uploaded on the market regulator’s website.
The asset management companies will have to submit “a soft copy of Scheme Information Document (Sid) alongwith printed/ final copy two working days prior to the launch of the scheme,” Sebi said in a circular.
“The move is a good one and is in investor interest. As earlier only draft offers of the MF schemes were placed on Sebi website for 15 days or so, till the scheme was approved. With this circular, fund houses will now have to put the final offer documents on the regulator’s site, which will also create a good data base,” Taurus Mutual Fund managing director R. K. Gupta said.
The fund houses will have to submit a soft copy of the additional information (Sai) document as well.
Moreover, mutual funds are also required to file with Sebi, in PDF format, the updated versions of Sid and Sai within seven days alongwith a printed copy, Sebi said.

New Delhi: Religare Mutual Fund on Tuesday announced the launch of an open-ended PSU Equity Fund.
The fund seeks to generate capital appreciation by investing in companies where the central or state governments has majority shareholding or where the management control lies with the government, Religare Mutual Fund said in a statement.
The fund aims to select fundamentally sound companies having the potential to deliver superior growth in the long term, it said.
The fund will invest in public sector companies having presence in core sectors and companies, which are expected to benefit from the divestment process and reforms.
At least 65% of the assets will be invested in companies, which are part of the BSE PSU Index.
The remaining 35% will be invested in PSUs outside the BSE PSU Index, it said, adding, the fund will also participate in forthcoming IPOs of such companies.
Speaking on the occasion, Religare Mutual Fund CEO Saurabh Nanavati said, PSU companies are attractively priced in terms of valuations vis-a-vis the broader markets and the BSE Sensex-almost at a 20-30% discount, thereby offering a good margin of safety for the investor.
With GDP growth being led by government spending last year and for the next 2-3 years, PSUs will be natural beneficiaries, with strong growth potential, he said.

Mumbai: A working group of the Association of Mutual Funds in India, or Amfi, has recommended that India’s two largest bourses, along with other firms, jointly build a transaction platform for mutual funds trading in India.
The group has suggested jointly engaging three consortia that have bid to build the platform: National Stock Exchange and National Securities Depository Ltd; Bombay Stock Exchange and Central Depository Services Ltd; and registrars Karvy Computershare Ltd and Computer Age Management Services Ltd.
“We have recommended an open architecture where strengths of all three consortia will be leveraged for the benefit of the mutual fund industry,” said Jaideep Bhattacharya, who heads the Amfi committee and is chief marketing officer of UTI Asset Management Co. Ltd.
The committee, which submitted this proposal to Amfi last week, has also suggested that mutual fund trackers Morningstar India and rating agency Icra Ltd provide the data support for this platform.
Amfi expects the platform to go live by March.
The proposed online portal will help investors buy and sell mutual fund units and get consolidated statements. With the abolition of upfront commission, few distributors are keen on servicing small investors and the transaction platform will come in handy for them.
“We have received proposals on the operationalization of the platform. A decision will be taken in a week or two. The final clearance has to come from Sebi,” said A.P. Kurian, chairman, Amfi.
According to him, the platform would provide a better reach for the industry, higher efficiency in transactions and cost control over a long term. “Similar platforms exist in developed markets like Australia and Canada. It is our effort to bring such world-class service to our investors,” he told Mint.
Officials from the bidding companies refused to comment as the proposal is yet to be finalised. The chief executive officers of four leading asset management companies confirmed the broad structure of the proposal but refused to comment as they are not familiar with the details. “A presentation is likely to be made for the members in a couple of weeks, after which a decision will be made,” one of them said.
In a parallel move, Amfi is exploring the listing of open-ended mutual fund schemes on an exchange platform.
The system has to be tweaked in such a manner that the relevant mutual fund will be the counterparty for transactions and the registrar will have to create and extinguish units for every purchase and sale, respectively, say industry experts.

policy, coming with features like depreciation, re-instatement value in case of total loss and daily allowance. As part of its plans to take "customer ownership" to the next level, Chola is the first to partner with Mapfre, a Fortune 500 company based in Spain.

Launching the Chola Protect 360 and a range of plans on Wednesday, Chola MS MD S S Gopalarathnam said the new policy was brought into the 40-year-old motor insurance market based on a market study.

In the first year, the company is aiming to sell one lakh policies and double it in the next year. An indicative premium of its policies for a brand new vehicle 1800 cc at an invoice price of Rs 8.5 lakh works out between Rs 20,634 and Rs 30,750 depending on the opted policy plans — current comprehensive policy, Chola Protect Optima, Chola Protect Superior, Chola Protect Elite and Chola Protect 360.

Commenting on its tie-up with Mapfre, Mr Gopalarathnam said it was a 3-year service pact that was aimed at leveraging the latter’s roadside emergency service provider specialisation. During its two-and-half year presence in India, Mapfre has invested Rs 40 to Rs 50 crore on specialised equipment, operating with a pan-India network across 50 cities and 24x7 multilingual call centre.

The motor premium segment is expected to generate around Rs 425 to 430 crore, constituting 46% of its overall business. Currently, Chola MS has 2 lakh policies in the private car segment and 1.5 lakh policies in the commercial vehicles segment.

Some of the key features of its latest bouquet of policy plans include reinstatement value benefit,upto Rs 10,000 cover for personal luggage loss during an accident.

Insurers bank on celebrity appeal

Vijay is the name of the character that Amitabh Bachhan has played in many of his movies. In most cases, Vijay belonged to the underprivileged class.
It’s a curious coincidence that the megastar has just become brand ambassador for an insurance product called Max Vijay, a product targeting the poor.
“We want to sell Max Vijay as an FMCG product,” says Anisha Motwani, chief marketing officer of Max New York Life.
Max Vijay is a low premium policy with a premium of Rs 10 to Rs 2,500. The product has so far covered 70,000 households and the insurer aims to take it to over three million in the next three years. The campaign, first launched in Agra, will target the Hindi heartland and then see a nationwide release.
“Max Vijay will help the common man to achieve his dream, as every rupee saved helps him to rise up the hierarchy,” says Piyush Pandey, Executive Chairman and Creative Director- South Asia, Ogilvy & Mather, the agency behind the new Max Vijay campaign.
Max isn’t the only insurer that has started leveraging celebrity appeal. Cricketers Sachin Tendulkar, Virendra Sehwag, Yuvraj Singh, and the winner of Femina Miss India 2009 Ekta Chaudhary have also jumped on the insurance “brand wagon”.
But will celebrity endorsement help in raising insurance awareness? No one is quite sure. Madhukar Sabnavis of Ogilvy and Mather says “since insurance is sold and not purchased, it’s not easy to push up sales. We do not know how successful the endorsements will be, but Bachhan did very well for ICICI Bank.”
The wait-and-watch mode to see the impact is understandable. Except for a couple of examples, celebrities have not been very successful in endorsing financial products.
Insurers, however, believe advertisements will help in attracting eyeballs at a time when higher penetration is on top of the agenda. The life insurance industry has a mere 4 per cent penetration, while it’s just 0.6 per cent for the non-life industry.
Recently, Birla Sun Life appointed cricketers as brand ambassadors. “They are actually philosophy ambassador and not brand ambassadors. We have tried to capture their aspirations and fears,” says Ajay Kakar ,chief marketing Officer of the Aditya Birla Financial services group.
Bajaj Allianz appointed the winners of Pantaloons Femina Miss India 2009 pageant, including Ekta Chaudhary, as its ambassadors.
“Celebrity endorsement creates instant recall and it becomes easier to reach the masses,” says Bajaj Allianz life insurance head marketing Akshay Mehrotra .
TapRoot India CEO Agnello Dias sums it up, saying “celebrities have nothing to do with the products they are endorsing, except a few.
The recent engagement of celebrities in the insurance space will only help them break the clutter.”
http://www.business-standard.com/india/news/insurers-bankcelebrity-appeal/371054/

BANK

The government has asked public sector banks (PSBs) to increase focus on attracting low-cost current account, savings account (Casa) deposits in order to contain their cost of funds. It will also enable them to maintain a softer interest rate regime.
The government has asked for specific Casa targets from public sector players, which have been provided by the banks as part of the discussion on statement of intent setting the targets for the current financial year. Bankers said that most public sector players had indicated a Casa growth of 17-20 per cent for the current financial year.
While the banks earlier focused on deposit growth, Casa deposits are coming into prominence for the first time. The move comes amid expectations of hardening of interest rates.
“The government wants banks to increase their Casa deposits. These low-cost deposits will help us to contain costs, which means that a softer interest rate regime can be maintained,” a banker said.
Over the last three years, the share of low-cost deposits for public sector banks has dropped from 39.95 per cent at the end of March 2006 to 32.66 per cent at the end of March 2009.
This year, Corporation Bank and Allahabad Bank have projected a 17-18 per cent growth in low-cost deposits. For Corporation Bank, the share of Casa in total deposits fell to 23.84 per cent in June as against 31.44 per cent at the end of March. The bank expected to close the current financial year with Casa deposits of 25 per cent.
Allahabad Bank’s low-cost deposit share was at 34 per cent and the bank would be looking to maintain the share, a bank executive said.
Punjab and Sind Bank is targeting a 20 per cent Casa growth in 2009-10. It would enable the bank to have a 30 per cent share of low-cost deposits in its total deposits. The Delhi-based bank’s Casa share was 27.7 per cent at the end of March 2009.
Even banks such as State Bank of India have witnessed a fall in the share of Casa to total deposits and have initiated steps to increase it. In case of SBI, the share of Casa in total deposits fell to 38.45 at the end of June this year as against 39.26 per cent in March due to a decline in current account balances. An increase in low-cost deposits would also help banks to improve their net interest margins (NIMs) which came under severe pressure in the first quarter. Repeated cuts in the benchmark prime lending rates since October-November last year also brought pressure on it.

http://www.business-standard.com/india/news/focus-morecasa-deposits-govt-tells-public-sector-banks/371560/

SEBI

Cost audit should be included in Clause 49: Panel

A government-appointed committee has suggested expanding the ambit of Clause 49 on listing of companies specified by market regulator Securities and Exchange Borad of India to include cost audit report.
“It (Clause 49) must be duly amended to focus and to conform to the cost audit structure so that companies report on the efficiency performance in more detail and to the benefit of the stakeholders in evaluating the company,” the latest report of experts on cost audit standards said.
Clause 49 of the Listing Agreement, which is signed between companies and stock exchanges, deals with various aspects of corporate governance.
The Corporate Affairs Ministry-appointed committee is of the view that cost audit can provide reliable and credible cost and revenue data to regulators to support decisions.
“An appropriate cost management system is required in all business units to remain competitive and the government should ensure through a legal framework that companies do install such a cost management system,” it said.
http://www.business-standard.com/india/news/cost-audit-should-be-included-in-clause-49-panel/371723/

NSE’s ‘random’ deal info to investors will make brokerages transparent

Our Bureau
Mumbai, Sept. 29 In a move that would force brokers to be more transparent in servicing their retail investors, NSE has decided that it will send every day a set of randomly chosen investors information on their stock market transactions.
“To begin with, information would be sent to around 250 retail and small investors, identified on a daily basis, to the address uploaded by trading members as part of UCC (unique client code) requirement,” an NSE circular said.
“It is intended to possibly prevent front running as the NSE statement would provide real-time updates on trades executed in a particular account,” an expert familiar with the matter said.
Investors will be able to compare the share prices at which their transactions were actually executed (from information sent by NSE) and the prices which their broker has communicated to them.
The new initiative by NSE is intended to enable investors to confirm or verify their transactions. The statement will contain the details of transactions executed by the investor on the exchange for that particular day.
“The information that would be provided by the exchange would include trade details such as buy or sell orders placed by the investor, security name, security symbol, trade number, trade time, quantity, prices and traded value,” NSE said.
Transaction statements will provide trade execution transparency and authenticity to the investors. It will also help stop certain malpractices, a broker said.

http://www.thehindubusinessline.com/2009/09/30/stories/2009093051900100.htm

Small IPOs can be filed in regional offices: SEBI

Our Bureau
Mumbai, Sept. 29 Draft public offer documents for any issue size of Rs 50 crore or less are to be filed with the regional SEBI offices assigned to States and Union Territories, the markets regulator said in a circular on Tuesday.
For public issues exceeding Rs 50 crore, the offer documents are to be filed with the SEBI headquarters in Mumbai.
SEBI has regional offices in New Delhi, Kolkata, Chennai, Mumbai and Ahmedabad.
Additional information
SEBI has directed mutual funds to submit a Statement of Additional Information (SAI) along with the Scheme Information Document (SID) for display on its Web site. SAI contains all statutory information on the mutual fund.
Mutual funds have also been directed to submit these documents for display on the Association of Mutual Funds in India (AMFI) Web site.
In case of material change in the SID or SAI, the updated documents to be filed with SEBI within seven days, SEBI said.
http://www.thehindubusinessline.com/2009/09/30/stories/2009093051271000.htm

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