Franklin India Income Builder Fund (FIIBA) is an open ended income scheme which aims to provide better returns on investments. It hopes to achieve these high returns by investing in high quality fixed income securities spanning different sectors and categories. This is one of the oldest funds in India and has performed consistently well since its inception.
Type or nature of fund
Franklin India Income Builder Fund is an open ended income scheme.
Investment objective
The primary objective of Franklin India Income Builder Fund is to provide a regular source of income and capital appreciation to investors.
Fund information
| Inception date | June 23, 1997 |
| CRISIL rank | Ranked 1 by CRISIL in Mutual funds |
| Schemes | Growth Plan
|
| Entry load | Nil |
| Exit load | 0.50% for redemptions within 1 year of allotment |
| Minimum investment | Rs 10,000 |
| Product label – Risk and target investors | Moderate Risk product designed for investors aiming for medium term capital appreciation with their current income through investments in corporate and PSU bonds. |
| Benchmark | CRISIL Composite Bond Fund Index
|
| SIP (Systematic Investment Plan) | Rs 1,000 (12 SIP investments of Rs 1,000 each) |
| SWP (Systematic Withdrawal Plan) | Yes. Available to investors with a minimum account balance of Rs 25,000. One can opt for either a monthly or quarterly mode with a choice between fixed and capital appreciation. |
| STP (Systematic Transfer Plan) | Yes. Investors need to reinvest redeemed units in another scheme. |
| Redemption | Minimum Redemption Amount – Rs 1,000. |
| Taxation (on investment and on redemption) | Investors are advised to consult their tax expert to know more about the specific tax implications arising out of their investment in this scheme. |
Fund managers
Franklin India Income Builder Fund has two fund managers, Mr. Santosh Kamath and Mr. Sumit Gupta.
Mr. Santosh Kamath
Designation and Work
- Mr. Santosh Kamath is the MD and Chief Investment Officer - Fixed Income at Franklin Templeton India. He is currently responsible for fixed income funds to the tune of 6.5 billion USD.
- Mr. Kamath has over 20 years of experience in asset management and has been with Franklin Templeton since 2006.
- Mr. Kamath is known for his investment sense and has won the Most Astute Investor award for five consecutive years.
Education
- Mr. Kamath has a BE in Electronics and Telecom from REC, Bhopal and a MBA from XLRI, Jamshedpur.
Mr. Sumit Gupta
Designation and Work
- Mr. Sumit Gupta is a portfolio manager in fixed income and is in charge of evaluating company credit.
- Mr. Gupta has over 9 years of experience in debt markets and was previously involved with Kotak Mahindra Bank.
Education
- Mr. Gupta completed his Btech from IIT, Delhi and his PGDM from IIM, Calcutta.
Investment philosophy or strategy
Franklin India Income Builder Fund mainly focusses on government securities, money market instruments and corporate bonds, which are not high risk propositions. Fund managers use a mix of top-down macro-economic methods and bottom-up credit analysis to determine the right investment choices. Investments are spread across sectors in a bid to reduce the risk factor involved.
Portfolio – Sector / Top 10 holdings
| Company | Rating | Percentage |
| Future Retail Limited | CARE AA- | 6.7 |
| JSW Steel Limited | CARE AA-- | 5.69 |
| Power Finance Corporation Ltd | ICRA A1+ | 5.5 |
| Indostar Capital Finance Ltd | CARE AA- | 5.1 |
| HPCL Mittal Pipelines Ltd | ICRA AA- | 4.57 |
| Reliance Broadcast Network Ltd | CARE AAA(SO) | 4.19 |
| Jindal Steel and Power Ltd | CRISIL AA- | 4.17 |
| HPCL-Mittal Energy Ltd | ICRA AA- | 4.12 |
| Andhra Pradesh Expressway Ltd | ICRA AAA(SO) | 3.62 |
| Legitimate Asset Operators Pvt Ltd | CARE A+ | 3.59 |
Risk measures – Last three years
The risk measures for various criteria are mentioned below (as on August 28, 2015)
| Sharpe ratio (Annualized) | 2.33 |
| R-squared | N/A |
| Beta | N/A |
| Standard Deviation | 1.96 |
Performance
| AUM | Rs 1792.35 crores (as of June 30, 2015) |
| NAV (as of 07/09/2015) |
|
Returns
The returns provided by Franklin India Income Builder Fund in comparison to market returns are shown in the table below.
| Period | Scheme returns | CRISIL Composite Bond Fund Index | CRISIL 10 year Gilt index |
| March 2012 – March 2013 | 11.06% | 9.24% | 11.25% |
| March 2013 – March 2014 | 8.13% | 4.32% | -1.01% |
| March 2014- March 2015 | 13.48% | 14.67% | 14.63% |
Expense Ratio
The Expense ratio of Franklin Income Builder Fund is mentioned in the table below.
| Daily Net Assets | Expense ratio |
| First 100 crores | 2.53% |
| Next 300 crores | 2.28% |
| Next 300 crores | 2.03% |
| Remaining Balance | 1.78% |
The current expense ratio of Franklin India Income Builder Fund is 1.95% for regular and 1.13% for direct(As of July 31, 2015).
Expert view of the fund
Franklin India Income Builder Fund is a fund which offers multiple plans and schemes designed to suit different individual requirements of investors. This plan has performed reasonably well since its inception, offering returns which are better that market returns in most cases, without undue risk of investment. This scheme could be a good option for individuals who are looking for decent returns minus high risk and who have a stable investment period in mind.
How to apply
Individuals looking to apply or register for Franklin India Income Builder Fund have two options – online and offline. Investors who prefer online registration need to log onto the official website of Franklin Templeton India and follow the steps listed on the website. They are required to provide their mobile numbers, email id, PAN information and bank details in order to successfully register.
The offline registration process requires one to approach an authorised distributor and fill up the KYC form, providing all relevant information and submitting it to the concerned authority.