Franklin India Low Duration Fund is an open ended income fund which primarily aims to provide decent returns on investment by investing in short term debt instruments and money markets. This is a short term fund and has lower risk associated to it when compared to other funds. This fund has an average maturity period of 1.10 years, making it an ideal opportunity to earn quick money.
Type or nature of fund
Franklin India Low Duration Fund is an open ended income scheme.
Investment objective
The primary objective of Franklin India Low Duration Fund is to provide regular income on investments by investing in highly recommended debt securities.
Fund information
| Inception date |
|
| CRISIL rank | Ranked 5 by CRISIL in Ultra Short term debt |
| Schemes |
|
| Entry load | Nil |
| Exit load | 0.50% for redemptions within 3 months of allotment |
| Minimum investment |
Rs 10,000 for Growth Plan Rs 25,000 for Monthly and Quarterly Plans |
| Product label – Risk and target investors | Low Risk product designed for investors looking for regular income for a short time period through investments in short term fixed rate debt instruments. |
| Benchmark |
CRISIL Short Term Bond Fund Index
|
| SIP (Systematic Investment Plan) |
|
| SWP (Systematic Withdrawal Plan) | Yes. Investors with a minimum account balance of Rs 25,000 can choose between a monthly or quarterly mode with fixed or capital appreciation. |
| STP (Systematic Transfer Plan) | Yes, all redeemed units need to be reinvested in another scheme. |
| Redemption | Minimum Redemption Amount – Rs 1,000. |
| Taxation (on investment and on redemption) | Investors should consult a tax expert/adviser to know the tax implications arising out of their participation in this scheme. |
Fund managers
Franklin India Low Duration Fund has two fund managers, Mr. Santosh Kamath and Mr. Kunal Agrawal.
Mr. Santosh Kamath
Designation and Work- Mr. Santosh Kamath is the Managing Director and Chief Investment Officer - Fixed Income at Franklin Templeton India and is in charge of fixed income funds worth 6.5 billion USD in his current position.
- Mr. Kamath been in this field for over 20 years, having joined Franklin Templeton in 2006.
- Mr. Kamath is known for his astute investment sense and is an award winning investor, having won the award for Most Astute Investor 5 times.
- Mr. Kamath holds a BE in Electronics and Telecom from REC, Bhopal and MBA from XLRI, Jamshedpur.
Mr. Kunal Agrawal
Designation and Work- Mr. Kunal Agrawal is the Co-head of credits at Franklin Templeton India and is in charge of evaluating company credit profiles.
- Mr. Agrawal has over a decade of experience in this field, having worked with IBM, Infosys and CRISIL ratings before joining Franklin Templeton.
- Mr. Agrawal completed his btech from IIT Delhi and PGDM from IIM, Calcutta.
Investment philosophy or strategy
Franklin India Low Duration Fund tries to classify itself into a fund which is between a liquid fund and short term fund which strives to invest in debt securities which are highly rated. Fund managers try to diversify investments in different sectors in a bid to reduce the risk factor attached with these investments. Funds managers try hard to ensure the duration of the portfolio is short, in order to provide quick returns to investors.
Portfolio – Sector / Top 10 holdings
|
Company |
Rating |
Percentage |
|
Shriram Transport Finance Company Ltd |
IND AA+ |
7.2 |
|
Power Finance Corporation Ltd |
ICRA A1+ |
6.87 |
|
JSW Techno Projects Management Ltd |
BWR A(SO) |
6.21 |
|
Mahindra World City (Jaipur) Ltd |
CRISIL A |
3.78 |
|
Magma Fincorp Ltd |
CARE AA- |
3.56 |
|
Sharda Solvent Ltd |
BWR AA- (SO) |
3.49 |
|
Albrecht Builder Pvt Ltd |
ICRA A+ |
3.45 |
|
Jindal Steel and Power Ltd |
CRISIL A1+ |
3.36 |
|
Hinduja Leyland Finance Ltd |
CARE A+ |
3.35 |
|
Future Retal Ltd |
CARE AA- |
3.32 |
Risk measures – Last three years
The risk measures for various criteria are mentioned below (as on August 28, 2015).
|
Sharpe ratio (Annualized) |
7.45 |
|
Alpha |
N/A |
|
Beta |
N/A |
|
Standard Deviation |
0.39 |
Performance
| AUM | Rs 3585.23 crores (as of June 30, 2015) |
| NAV (as of 07/09/2015) |
|
Returns
The returns provided by Franklin India Low Duration Fund in comparison to market returns are shown in the table below.
|
Period |
Scheme returns |
CRISIL Short Term Bond Fund Index |
1 year T-Bill |
|
March 2012 – March 2013 |
9.87% |
9.05% |
8.38% |
|
March 2013 – March 2014 |
9.77% |
8.78% |
5.77% |
|
March 2014- March 2015 |
10.19% |
10.40% |
8.82% |
Expense Ratio
The current expense ratio of Franklin India Low Duration Fund is 0.77% for regular and 0.48% for direct (As of July 31, 2015).
Expert view of the fund
Franklin India Low Duration Fund , being a low risk investment offers returns which might not seem exciting enough in most cases. The fund has managed to perform decently well since its inception, offering returns which are slightly better than market adjusted returns. This is a good scheme for individuals who want quick returns on investments, primarily because the fund managers invest in short term securities. With a large number of plans, this fund could offer something for everyone, provided that an investor is happy with average returns.
How to apply
Individuals looking to invest in Franklin India Low Income Fund are first required to register themselves, which can be done through both online and offline modes. Online registration can be done by logging on to the official website of Franklin Templeton India and providing some basic information like email id, PAN details, Bank details and mobile number.
Offline registration can be done through authorised branches by filling out an application form and submitting it to the relevant authority.
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