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HDFC Launches FIP March 2002

HDFC Mutual Fund has launched a Fixed Investment Plan (FIP) March 2002. It is a close-ended income scheme and will mature on April 10, 2003. The fund's initial offer is open for subscription from March 18 to March 26, 2002.

It is a no load fund and the initial issue expenses will be borne by the AMC. However, an exit load of 1 per cent will be charged if redeemed before March 27, 2003. The minimum application amount is Rs 1 lakh and in multiples of Re 1 thereafter.

The rationale of the fund is to provide investors with an opportunity/option to avail the benefit of long-term capital gains, double indexation or both. In case the investor chooses to redeem on the 366th day i.e. on the March 27, 2003 he will be entitled only for long-term capital gains with single indexation (10.5% tax with indexation or 21% without indexation) benefit, whichever is lower. If the investor redeems after March 31, 2003 he will be entitled for long-term capital gains with double indexation.