Introduction

JM Agri & Infra Fund is a 3 year close - ended equity oriented scheme (Opening for subscription after 3 years) from JM Financial Mutual Fund whose investment objective is to provide capital appreciation by primarily investing in stocks that are related to Agriculture & Infrastructure industries. JM Agri & Infra Fund aims to capture the expected strong performance from both these sectors – first such scheme straddling the two future growth drivers of the economy.

Investment Strategy

The scheme will invest across agriculture and infrastructure related sectors. It will not have any market capitalization restrictions, such that the investments will be across Market Cap range. The Agri and Infra related sectors account for 62% of the BSE Market Cap. The portfolio of the scheme would be diversified with 25-30 stocks and may also invest in unlisted securities to a maximum of 10% of the assets while the scheme is close - ended. The share of the two sectors will generally be split 50:50. However, based on relative valuations, the mix can move between 30 – 70%

Investment Theme

Infrastructure
India’s economic growth momentum continues to be strong with economy poised to grow at 9% over the next few years.* Infrastructure will be one of the key drivers of this economic growth. Current state of infrastructure is not enough to sustain this growth as India still lags behind some of its peers in this space. Although infrastructure has seen investments of over US$220bn over the past 5 ears,** this is just the tip of theiceberg. Infrastructure investments which were hither to focused on roads, power and telecom are now beginning to spread across other areas such as airports, ports, urban and
rural infrastructure. With higher private sector participation and benign regulatory and macro environment, infrastructure would see much higher investments at over US$500bn over the next 5 years.** These investments would expand the universe of companies available for investment in this sector. Thus, infrastructure, the flavour of the past 3 years would continue to offer immense opportunities.

Agriculture
India’s agriculture sector, a laggard over the past decade, appears to be turning around. This second green revolution is driven by higher participation from the private sector across the value chain. With government recognizing the need for change, policy environment is beginning to turn benign. Public investments have accelerated over past 3 years and have addressed irrigation, farm inputs and other areas affecting agri output. Emerging organised retail growth is acting as a catalyst for reforms in agriculture sector. Changing consumer preferences and higher corporate investments in the sector will mean the target of 4% growth would be achievable over the next decade.^ The benefits of this sustained growth will be visible across the economy as related sectors would also feel the positive impact; e.g. Agri inputs, Irrigation and infrastructure,Food processing, dairy, etc. The turnaround in agriculture will also have an indirect impact in the form of higher rural income and improved consumer demand. For investors, opportunities will be present across the spectrum of agri chain as we expect explosion in the agriculture related universe as new companies enter the arena to capture these opportunities. Agriculture is thus at a threshold level where infrastructure was present 5 years back – ready to take-off.

Scheme Features:

Entry load - During new fund offer period there will be no entry load as close ended schemes are not permitted to charge entry load

Exit load - For ongoing redemptions/switch out after three months from the date of allotment, the exit load till maturity of the scheme will be nil. However, at the time of redemption, the unitholders will be charged the balance proportionate unamortized

Liquidity: - Repurchase facility will be available to the Unitholders after three months from the date of allotment. The Repurchase facility will be available on the first five business days at the beginning of the calendar month, after deduction of the balance proportionate unamortized new fund offer expenses applicable to their investments. Upon maturity, once the Scheme is automatically converted
into an open-ended Scheme, it will offer purchase / repurchase facility on all business days.

Choice of Investment options:

•The Scheme will offer two options to the Investors: (a) Growth and (b) Dividend. Both the options will have a commonportfolio. Minimum Subscription /Redemption Amounts:

•Subscription by the Unitholder under the Scheme during the New Fund Offer should be for a minimum investment Rs. 5,000/- per Plan / Option and in multiples of Re. 1/- thereafter.

•Minimum redemption from existing Unit Accounts would be Rs. 500 or 50 units during the close ended period and once the Scheme is converted into an open ended scheme on maturity. Any redemption in excess thereof may be in multiples of Re.1/- subject to keeping minimum balance of 500 units.

Our Recommendation

Members are requested to Click here to place order for applying under power of attorney.

Non members are requested to Click here to download the form. Please make sure to attach your pancard copy with the form.

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Thanking You

Kishor A Shah