NFO Update: Franklin India Feeder-Franklin European Growth Fund



Franklin India Feeder-Franklin European Growth Fund

(NFO Period: 25th April’14 to 9th May’14)

 Franklin India Feeder-Franklin European Growth Fund is an open ended fund of funds scheme investing overseas that seeks to provide capital appreciation by investing predominantly in units of Franklin European Growth Fund, an overseas equity fund which primarily invests in securities of issuers incorporated or having their principal business in European countries.

The fund provides investors access to European markets bringing about an effective diversification to their portfolio as developed markets show low correlation to Indian capital markets. Moreover, given the volatility in Indian markets since 2008, global diversification becomes especially relevant.

 

Why Europe now?

 

A crisis in European countries does not necessarily mean a crisis in European companies.

 

  • Europe is too big to ignore: Europe remains a significant producer of goods and services contributing to

European companies have improved fundamentals: While Europe witnessed a recession post the global financial crisis in 2008, measures taken by the European Central Bank (ECB) and the individual governments of the European region have been instrumental in improving the overall economic environment and bringing it back on the path of steady economic recovery.

 

European companies have a global competitive advantage: Europe based companies have demonstrated strong competitive advantage in several areas such as engineering, pharmaceuticals, consumer business etc. This is validated by the fact that they are the biggest exporters. In fact, companies in Europe export more than the combined total of North and South America, the Middle East and Africa.

 

Export by Region (In Billions USD)

 

 



Attractive relative valuations: Current (as on 31-Mar’14) average P/B Ratios of European Stocks by Sector vs. 15-Year Averages

 

About Franklin European Growth Fund

 

  • The fund follows an active, bottom-up fundamental research process to search for individual securities believed to possess superior risk-return characteristics
  • The endeavor is to identify companies that have sustainable competitive advantages, strong balance sheet and available at attractive valuations
  • Fund mandate provides investors with exposure to European companies, by investing in companies across market capitalization
  • An experienced group of teams provide deep industry knowledge to find the leading growth companies in their respective sectors

 

 

Top 10 Holdings (As on 31-Mar’14)

Historical Performance (As on 31-Mar’14)

 

Fund Features:

 

Minimum Investment:      Minimum Rs. 5000/- and in multiples of Re. 1/- thereafter
OptionGrowth and Dividend (Payout / Reinvestment)
Pricing (per unit)NFO – Rs.10/- per unit
Load StructureEntry LoadNil; Exit Load – 1% if redeemed before 18 month from allotment date
Benchmark          MSCI Europe
Fund ManagerNeeraj Gaurh
NFO Period25th Apr’14 to 9th May’14

 

Product Suitability

NFO Update: Franklin India Feeder-Franklin European Growth Fund
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