D’MAT scheme from GICMF

MUMBAI, APRIL 21: GIC Mutual Fund has come out with a unique scheme -- GIC D'MAT -- which will invest on a selective basis in demateriali...

MUMBAI, APRIL 21: GIC Mutual Fund has come out with a unique scheme — GIC D’MAT — which will invest on a selective basis in dematerialised shares. The scheme which opened for subscription late last month will close on April 24.

The scheme is aimed at investors who wish to participate in paperless trading in the equity market by converting their holdings in shares — that are dematerialised or likely to be dematerialised — into units of the scheme or by investing directly in the scheme.

“This open-ended scheme will be eligible for repurchases at net asset value (NAV,” said officials from GIC Mutual Fund. The conversion price for the equity shares submitted by investors will be the average closing price for the scrip on the Bombay Stock Exchange on five working days preceeding the closure of the initial offer period.

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The entire income of the fund is exempt from income-tax in accordance with the provisions of the IT Act, 1961. The fund will receive all income without any deduction of tax at source.GICMF has kept the fund open-ended with the objective of attracting more investors at a later stage.

“The advantage of this scheme is that small investors need not go to depository participants for dematerialising their shares. Now there is compulsory dematerialised trading in several shares. Investors can sell these shares to us. We will in turn give them D’MAT units,” said a GIC Mutual Fund official.

As of March 1999, GIC Mutual Fund, promoted by the General Insurance Corporation, has nine funds with a total corpus of Rs 931 crore. It is gearing up to launch another unique fund in the near future.