The Reliance Infrastructure Mutual Fund will primarily invest in shares of infrastructure companies in India. It will have at least 65% of its assets invested in shares of infrastructure companies and the balance in debt instruments. It will also invest in derivative instruments for hedging and rebalancing purposes.
The fund aims to capitalize on the fact that the infrastructure sector in India is lagging investments and is a focus area for the government to allow the economy to continue on its growth path and add momentum to the economic development.
The fund will invest in infrastructure and infrastructure related companies, but there is one thing that you need to be aware of.
Banks, financial institutions and such, which lend to this sector, also come under this category and the mutual fund may invest in such companies also. This is not a good or bad thing – just something to keep in mind. Most investors don’t equate a financing company with infrastructure and so are sometimes surprised when they hear that their infrastructure mutual fund holds State Bank of India or some other such bank or finance company.
Here is a list of sectors that the fund may invest in (from their prospectus): At first glance it may occur to you that the Reliance mutual fund will invest most of its assets in Airport, then Banks, then Cement and so on (which is what I felt), but this is not true. This is just a list of indicative sectors and is not in any particular order.
- Airports
- Banks, Financial Institutions and Term Lending institutions.
- Cement
- Coal
- Construction
- Electrical and Electric Component
- Engineering
- Energy
- Industry Capital Goods
- Metals and Minerals
- Ports
- Power and Power equipment
- Road and Railways
- Telecom
- Transportation
- Urban Infrastructure
- Mining
- Aluminum
Reliance Infrastructure Fund Manager
Mr. Sunil Singhania is the fund manager; he is a B.Com, CFA and has 11 years of experience in the capital markets. He also manages the Reliance Growth Fund, Reliance Equity Fund, Reliance Long Term Equity Fund, Reliance Diversified Power Sector Fund and Reliance Banking Fund.
Entry Load of Reliance Infrastructure Mutual Fund
- Subscription below Rs. 2 Crores: 2.25%
- Between Rs. 2 and 5 Crores: 1.25%
- Above Rs. 5 Crores: Nil
Exit Load of Reliance Infrastructure Mutual Fund
- 1% if redeemed within a year of allotment
- Nil if redeemed after a year of allotment
- Nil if subscription is more than Rs. 5 crores
Minimum Application Amount for Retail Investors
The minimum investment needed is Rs.5000 and if you want to invest additional money then you must invest a minimum of Rs.1000.
Plans offered by Reliance Infrastructure Mutual Fund
There are two types of plans in this fund:
- Growth Plan and
- Dividend Plan
The growth plan is meant for people who are not looking for regular dividend payouts from the mutual fund and the income from their funds will be reinvested in the fund. The Dividend plan on the other hand will give you dividend income (when the fund declares dividends). There is a dividend reinvestment plan also where the fund will reinvest your dividends to buy more units of the mutual fund.
How to Invest in the Reliance Infrastructure Mutual Fund NFO
If you have an online brokerage account like icicidirect.com, you can invest in this fund through them. You can also invest by filling out this form and submitting it in HDFC or Axis bank branches.
Tax Rates
The dividends are tax free in the hands of resident Indian investors. Similarly, there is no tax on long term capital gains. There is a 15% tax on short term capital gains of the scheme.
Disclosure: I will not be applying for this mutual fund. This is not a buy or sell recommendation for this fund, just a summary of it and my personal thoughts on it. If you are planning to buy or sell, please take advice specific to your financial situation and portfolio.
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Hi Nilima,
The portfolio and the analysis of the Fund in in pdf format which i cannot share here due to restrictions. U can call me on 9819237844 or mail me on the email address that is abhishekgoswami@dbs.com. Further more since im a banker, providing info is not bcoz of my personal interest but wholly on sharing info and my experience.
Regards,
Abhishek
i want to invest minimum amt for this mf but i want to know how to invest in relience infrastructure & how this fund is beneficial for me & my future plan
1. Sponsors :The Sponsor of the Mutual Fund is Reliance Capital Limited (RCL) having a net
worth of over Rs.5161.23 crores as on March 31, 2007.
2. Name of the Scheme : Reliance Infrastructure Fund, A 36-Months close ended diversified equity fund with an automatic conversion into an open ended scheme on expiry of 36-months from the date of allotment .
3. Investment Objective: The primary investment objective of the scheme is to generate
long term capital appreciation by investing predominantly in equity and equity related instruments of companies engaged in infrastructure and infrastructure related sectors and which are incorporated or have their area of primary activity, in India and other parts of the world and the secondary objective is to generate consistent returns by investing in debt and money market securities.
4. Choice of Investment Plans: Reliance Infrastructure Fund offers Retail Plan and Institutional Plan and each plan will have Growth Plan and Dividend Plan .
For any more details you can mark a mail to the above given email address.
plz contact me for investing in reliance infa nfo mumbai 9819056060
Does it have Tax saving benefit under 80C for the investment? and is there any tax deduction on its returns? Please clarify.
@Jai Narayan, The min amount is 5,000.
i want to invent minimum amt for this MF
@ Vijay Kant,
This is an open ended mutual fund and so you will be able to buy and sell any time. But, if you sell before an year then there is a 1% load on your investment.
I am not sure what you mean by application rate.
See this ICICI Link for more about Open Ended Mutual Funds:
http://content.icicidirect.com/mutualfund/mfhelp.htm#16
Question:
Sir, can you confirm me that there is lock in period of 3 years in reliance infra. and also confirm me that what is the application rate initally launched?
what will be the future of infrastructure Should i can expect a lot from it What is the difference of NFO & IPO
@jenin
NFO is a New fund offer, which means it is a new offer from a mutual fund. A mutual fund invests in shares of other companies.
IPO is an Initial Public Offering which means that a company is issuing its own shares to the public for the first time.
@A Thomas,
I went to icicidirect and it did show me an entry load, so I don’t think it is waived off, when you apply through icicidirect.
Application form says entry load is waived if you apply directly.
Is the entry load waived if you apply through icicidirect?
I want to know the minimum amt that should be spent on purchase on reliance infrastructure shares & whats the procedure to attain
Regards
Naresh Mehta
Yes it is good.
Pl. send me the common form for applying direct for latest Rel infrastructure NFO
@ Anil and Mithun: The minimum amount is Rs. 5000.
@Anil, Aji @ Mithun: You can invest from online broker, not online banking but online broker like icicidirect.com etc.
i want to know how to invest in reliance infrastructure?
tell me the procedure?
what a minimum investment is?
how long should i invest?
shall i invest directly from my internet banking?
how can i switch when the market is down?
can i invest 1000/2000 rupees in reliance infrastructure mutual fund or i have to iinvest 5000 Rs.
please send me full detail about reliance infrastructure nfo
i want to know how to invest in reliance infrastructure?
tell me the procedure?
what a minimum investment is?
what i have to do while investing?