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Kotak International REIT FOF NFO - Investment Objective, SIP Details, Who Should Invest

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Gaurav Seth
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Kotak International REIT FOF NFO

Kotak Mutual Fund has announced the launch of Kotak International REIT FOF (Fund of Funds). The scheme would be investing in units of SMAM ASIA REIT Sub Trust fund and other overseas REIT funds.

The New Fund Offer (NFO) starts from 07th December 2020 and will end on 21st December 2020.

Investment Objective 

The investment objective of the scheme is to provide long term capital growth by investing in units of SMAM ASIA REIT Sub Trust fund and/or other similar overseas REIT funds.

What is REIT?

REIT stands for Real Estate Investment Trust which owns, operates, and finances income-generating real estate assets.REITs pool investments from numerous investors just like mutual funds. REIT helps the investors benefit from the growth in the real estate markets without buying, managing, or financing any property by themselves.

Why Asia-Pacific REIT FOF?

  1. It can offer an attractive dividend yield.
  2. With the strong economic growth, it shows strong growth potential by an increase in demand for commercial facilities, office buildings, and logistic properties.
  3. Robust economic growth and rising rents can lead to a rise in the prices of property in the APAC region.
  4. REIT market development in the APAC region is expected to result in increased earning opportunities and therefore generate stable income.
  5. Dividend Yields from REITs in APAC have been higher than in developed markets.
  6. Growth in consumer spending is expected to increase retail sales & a rise in demand for commercial spaces.
  7. Urbanization is leading to a rise in commercial as well as housing markets.

Exposure of Kotak International REIT FOF:

Kotak REIT offers exposure to various REIT across the geographies and also to various real estate segments like Data Centres, Residential, Warehouses, Logistics, and Offices.

Following is the allocation of the underlying SMAM Asia Sub Trust Fund as of October 2020:

CountriesAllocation
Singapore48.8%
Australia33.7%
Hong Kong9.0%
New Zealand3.1%
Thailand1.2%

Features

  • The Fund will be investing at least 95% of its assets in units of SMAM ASIA REIT Sub trust Fund and other overseas REIT funds.
  • The Fund has an experienced investment team including:

- Expert Portfolio managers in the real estate sector

- An expert team of 10 professionals who will be monitoring the Asia and Pacific REITs market.

  • The fund will follow a bottom-up approach for investments by focusing on profit and capital growth, Dividend yield, valuation, and market liquidity.
  • The portfolio will be formed with a combination of Asian REITs with major investments in Singapore & Hong Kong and Pacific REITs with a major allocation in Australian market.

Who Should Invest?

This scheme is suitable for investors who are -

  • Interested in long term capital growth.
  • Interested in capital growth and income by making investments in units of SMAM ASIA REIT Sub trust Fund and other overseas REIT funds.
  • Recommended for investors with an investment horizon of 5 years & above.

Asset Allocation Pattern-

InstrumentsMinimum % of total assets (Indicative)Maximum % of total assets (Indicative)Risk Profile
Units of SMAM ASIA REIT Sub Trust Fund  and other overseas REIT funds95100High
Debt and money market instruments  and units of other domestic debt & liquid schemes 05Low to Moderate

About the scheme-

Name of the fundKotak International REIT FOF
Fund launched byKotak Mahindra Mutual Fund 
Asset Management CompanyKotak Mahindra Asset Management Limited
Type of schemeAn open-ended fund of fund scheme investing in units of SMAM ASIA REIT Sub Trust fund and/or other similar overseas REIT funds.
Investment ObjectiveThe investment objective of the scheme is to generate long term capital growth through investments in units of SMAM ASIA REIT Sub Trust fund and other similar overseas REIT funds.
BenchmarkS&P Asia Pacific ex Japan REIT TRI
Entry LoadNot Applicable
Exit Load

1% of applicable NAV - If units are redeemed or switched out within 12 months.

Nil - If units are redeemed or switched out after 12 months.

Minimum Application Amount ₹ 5,000 & in multiple of ₹ 1 thereafter
Minimum Additional Amount₹ 1,000 & in multiple of ₹ 1 thereafter
SIP Top-up, STP,DTP & SWPAvailable
Plans Available
  • Regular
  • Direct
Options
  • Growth
  • Dividend Payout
  • Dividend Reinvestment
Fund ManagersMr. Arjun Khanna

SIP Details

Type Minimum InstallmentsMinimum Amount
Monthly SIP6₹ 1,000 & in multiple of ₹ 1 thereafter
Quarterly SIP6₹ 1,000 & in multiple of ₹ 1 thereafter
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