Franklin India High Growth Companies Fund

The Franklin India High Growth Companies Fund is an open ended equity fund with a focus on both top down and bottom up approach, utilizing both micro and macro analysis to strengthen its position. The fund primarily concentrates on high growth companies which have sustainable competitive advantages and is apt for investors who wish to diversify their investment portfolio.

Type or nature of fund

The Franklin India High Growth Companies Fund (FIHGCF) is an open ended diversified equity fund.

Investment objective

The primary objective of Franklin India High Growth Companies Fund is to achieve capital appreciation by investing in Indian companies which have a high growth potential.

Fund information

Inception date July 26, 2007
CRISIL rank FIHGCF has a mutual fund rank of 1
Schemes

Growth Plan

  • Dividend Plan – Has Reinvestment and Payout options
  • Direct Growth Plan
  • Direct Dividend Plan - Has Reinvestment and Payout options
Entry load Nil
Exit load The exit load is 1% for redemptions within two years of allotment.
Minimum investment Rs 5,000
Product label – Risk and target investors This is a moderately high risk product and is designed for investors looking for long term capital appreciation through funds which invest in companies with high growth potential.
Benchmark

CNX 500

  • CNX 500 is a broad based benchmark of the Indian capital market. It represents 95.77% of all free float market capitalization stocks on the National Stock Exchange.
SIP

Rs 500 (subject to a minimum of 12 SIP investments of Rs 500 each)

Rs 1,000 (subject to a minimum of 6 SIP investments of Rs 1,000 each)

SWP Yes, SWP facility is available to investors having a minimum account balance of Rs 25,000. Individuals can opt for either a Monthly or quarterly mode.
STP

Yes.

STP facility is available on a monthly or quarterly basis and redeemed units should be reinvested in another scheme under STP.

Redemption Minimum Redemption Amount – Rs 1,000. This amount will be sent to an investor within ten working days.
Taxation (on investment and on redemption) Investors are advised to consult their tax advisers with regard to specific tax implications related to their participation in this scheme.

Fund managers

The Franklin India High Growth Fund has two fund managers, Ms. Roshi Jain and Mr. Janakiraman Rengaraju.

Ms Roshi Jain

Designation and Work

  • Ms Roshi Jain is the current Vice President of Portfolio Management Equity at Franklin Templeton India. She is also the portfolio manager for other funds including Franklin India Flexi Cap, Franklin Asia Equity Fund and Franklin Build India Fund, apart from being a co-portfolio manager for other assets.
  • Ms Jain has 14 years of experience in this field, having worked at Goldman Sachs previously.

Education

  • Ms Jain did her CA from ICAI and also holds a PGDM from IIM Ahmedabad.

Mr. Janakiraman Rengaraju

Designation and Work

  • Mr. Janakiraman Rengaraju is the Vice President of Portfolio Management Equity at Franklin Templeton India. In addition to this fund Mr. Rengaraju also handles other funds like the Franklin India Flexi Cap, Franklin India Prima Fund, Franklin India Opportunities Fund and the Franklin India Smaller Companies Fund.
  • Mr. Rengaraju has been in the investment field for over 14 years, having worked with companies in Chennai and Mumbai before his current role.

Education

  • Mr. Rengaraju has a MBA from IIM Bangalore and a BE from Government College of Technology, Coimbatore.

Investment philosophy or strategy

The primary strategy employed by Franklin India High Growth Companies Fund is to invest in companies which have a fast growth potential and those which offer a perfect balance between risk, growth and valuation. It hopes to capitalise on the growing economy, where companies can offer excellent returns on investment thanks to better management, ownership of intellectual property and cost advantages.

Portfolio – Sector / Top 10 holdings

Company Sector Percentage
HDFC Bank Ltd Banking 5.98
State Bank of India Banking 5.85
Tata Motors Ltd Auto 5.83
ICICI Bank Ltd Banking 5.60
Axis Bank Ltd Banking 5.31
Maruti Suzuki India Ltd Auto 5.18
Idea Cellular Ltd Telecom Services 4.72
TVS Motor Company Auto 4.70
L&T Ltd Construction 3.48
Pantaloons Fashion and Retail Ltd Retail 3.22

Risk measures

The risk measures for various criteria over the last three years are mentioned in the table below.

Sharpe Ratio 1.89
R-squared 0.81
Beta 0.96
Standard Deviation 4.43

Performance

AUM Rs 3345.16 crores (as of July 31, 2015)
NAV (as of 31/07/2015)

Dividend – Rs 25.65

Growth – Rs 30.86

Direct Dividend – Rs 26.27

Direct Growth – Rs 31.59

Returns

The returns provided by Franklin India High Growth Companies Fund in comparison to market returns are shown in the table below.

Period Scheme returns S&P CNX 500 S&P CNX Nifty
March 2014-March 2015 73.45% 33.56% 26.65%
March 2013-March 2014 24.75% 17.72% 17.98%
March 2012-March 2013 13.90% 5.13% 7.31%

Expense Ratio

The Expense ratio of Franklin India High Growth Companies Fund is mentioned in the table below.

Daily Net Assets Expense ratio
First 100 crores 2.77%
Next 300 crores 2.52%
Next 300 crores 2.27%

Expert view of the fund

Franklin India High Growth Fund has performed above par since its inception, cashing in on a booming economy and spurt in quality companies cropping up in India. This Fund has performed stronger than other similar funds offered by other organisations, indicating the thought process and foresight put into it by the fund managers. It could be a smart investment option for individuals looking to capitalise on the growth of new Indian companies in the future, albeit it is a long term investment and investors need to exhibit patience while investing in it.

How to apply – online + distributors

One can invest in a Franklin India High Growth Fund through both an online and offline platform. Individuals wishing to invest in this fund need to log onto the official website of Franklin Templeton India and follow the basic steps mentioned there. One needs to provide his/her PAN details, mobile number and bank details in order to register online.

Individuals can also apply through a Franklin Templeton branch. They are required to fill out an application form and provide relevant data about their scheme and then submit the form.

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