Franklin India Low Duration Fund Files Draft with SEBI

Franklin Templeton Mutual Fund has submitted a draft to SEBI for the Franklin India Low Duration Fund (FILDF). This is an open-ended debt scheme that will invest in low-duration debt and money market instruments. The scheme will maintain a Macaulay duration of 6 to 12 months, categorising it as a short-term debt fund.

NFO Details

The New Fund Offer (NFO) opens on February 25, 2025, and closes on March 5, 2025. The scheme will reopen for continuous purchase and redemption on March 7, 2025. Units will be available at ₹10 per unit during the NFO period. The minimum investment amount is ₹5,000, with additional purchases allowed in multiples of ₹1.

The scheme aims to generate income by investing in debt securities, corporate bonds, PSU bonds, and money market instruments. The benchmark for this fund is the NIFTY Low Duration Debt Index A-I.

Risk Classification

As per SEBI guidelines, the fund falls under Potential Risk Class (PRC) B-III, which indicates moderate credit risk and relatively high interest rate risk. This classification means that while the fund will invest in relatively safer instruments, its value may be affected by fluctuations in interest rates.

Asset Allocation

The fund will primarily invest in debt and money market securities, with a securitized debt exposure of up to 50%. It may also use derivatives for risk management. The scheme does not propose to invest in foreign securities, REITs, or InvITs.

There is no exit load for this scheme. The expense ratio will be aligned with SEBI regulations, with a maximum cap of 2% on the first ₹500 crore of assets under management (AUM).

Redemption and Liquidity

Investors can redeem units on any business day, with proceeds expected within three working days. The fund aims to maintain sufficient liquidity to meet redemption requests. The scheme will be managed by Chandni Gupta and Rahul Goswami, who have experience in fixed-income investments.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Mutual Fund investments in the securities market are subject to market risks, read all the related documents carefully before investing.