Mumbai: Life Insurance Corporation of India’s mutual fund arm LICMF is planning to launch a new fund for a three-year scheme ‘Progressive Equity Fund’ and has filed an offer document with market regulator Sebi.
The closed-end scheme requires a minimum investment of Rs5,000 and would automatically convert into an open-ended one at the end of three years, the company said in a filing to the Securities and Exchange Board of India.
The fund has an initial contribution of Rs2 crore and LIC Mutual Fund Asset Management Company has been appointed investment manager for the fund.
The investment objective of the scheme is to achieve long-term growth by investing systematically in equities or equity-linked instruments. It, however, does not provide assured returns.
The scheme offers investment under two options — dividend and growth. Under dividend option, the unit holder can opt either dividend payout or reinvestment.
Earnings of the scheme is totally exempt from income tax under Section 10(23D) of the Income Tax Act, it said.
Since the scheme provides repurchase facility every week during the closed-end period and on all business days after conversion into an open ended scheme, it is not proposed to be listed on any stock exchange at present.