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Carrie Lee

HONGKONG brokers and fund managers are targeting products based on the Indian stock market to take advantage of the relaxation in rules relating to share buying by foreigners.

   Yesterday Credit Lyonnais began marketing the India Opportunities Fund in Hongkong as the first stop in a worldwide roadshow.

   Jardine Fleming's India Pacific Trust, originally launched in 1989, is preparing to increase dramatically its India weighting after obtaining a tax exemption from the authorities to invest directly in the Indian stock market.

  The Barclays de Zoete Wedd investment group is ready to launch a new India fund in the next few days.

   India Opportunities fund, which is being managed by Martin Currie Investment Management - an open-end, tax-free fund which will be fully invested in India - is expected to raise between US$50 million to $100 million, and will target 50 to 70 stocks.

   The cash will be 70 per cent invested among the leaders, with the balance going into small to medium stocks counters.

  Cash balances will be in the five per cent to 15 per cent range.

  The fund is aimed at institutional investors with a minimum investment of $10,000, and there will be an annual management fee of 1.8 per cent and initial charge of 3.5 per cent.

  Director of the investment manager Tristan Clube said the fund would focus on stocks in the export sector, stocks related to infrastructure projects and stocks related to consumer goods.

        The offer will open towards the end of the month. Payment is to be made in US dollars.

  The Indian weighting in Jardine Fleming's fund is now about 50 per cent, compared with 10 to 20 per cent previously, and the managers expect the India content in the open-ended fund to rise to more than 90 per cent soon.

  Hongkong investment manager of the trust Jonathan Boyer believed the re-structured fund would be able to maintain its impressive track record.

   Its net asset value gained over 66 per cent in US dollar terms in the first half of this year.

  The trust's name is intended to be shortened to JF India Trust to reflect the increasing specialisation.

  The fund is available through Jardine Fleming Unit Trusts.



Indian funds take advantage of relaxed investment rules