Country's first growth fund hits market so

Raihan M Chowdhury

Country's first growth fund 'Asian Tiger Sandhani Life Growth Fund' worth Tk 1.0 billion is set to hit the market soon.

According to stock market sources, the subscription of the fund will be opened  January 11.

Asian Tiger Capital Partners Asset Management Company is launching the fund, sponsored by Sandhani Life, one of the leading life insurance companies in Bangladesh, contributing Tk 200 million.

General investors will subscribe Tk 600 million while the rest Tk 200 million will be raised from private placement.

Growth funds focus on companies that managers believe will experience faster than average growth as measured by revenues, earnings, or cash flow.

Bangladesh is an emerging economy and there are a number of companies those have very high growth potentials in long run.

The objective of the growth fund managers will be to identify those companies and put substantial allocation on those stocks with a proper risk management tools to maximize the risk adjusted return and outperforming the market in the long run.

Growth fund managers also look carefully at the way a company manages its business. For instance, many growth-oriented companies are more likely to reinvest profits in expansion projects or acquisitions, rather than use them to pay out dividends to shareholders.

They tend to perform better than the overall market when stock prices in general are rising. However, it is worth noting that past performance does not guarantee future results.

"Therefore investing in growth funds usually requires a longer time horizon," an analyst pointed out.

As per the source from Asian Tiger Capital Partners Asset Management Company, the Net Asset Value (NAV) at market as on June 30, 2014 audited account was BDT 14.12 (Based on sponsors portion only) where the IPO participants can invest in the fund at face value of BDT 10 only.

The subscription will continue till January 15, 2015 for Resident Bangladeshi investors, institutions, mutual funds and affected small investors.

For Non Resident Bangladeshi, the subscription period will be from January 11, 2015 to January 24, 2015.



raihanmchowdhury@gmail.com

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