Reliance Capital : Selected as pension fund manager.

This is the reason why HBJ Capital has recommended to Buy Call Option of Reliance Capital in Aug.

Pls read on...4 funds are going to manager Rs 30,000 fund annually means $8bn per year, do we really need FII/FDI to drive our market? I don't think so.

• At present, the Employees' Provident Fund Organisation (EPFO) does not invest in stocks, though there is a proposal to allow the fund to invest up to 10% of its corpus in equity.
• Rs 2,40,000 crore in the corpus fund and another Rs 30,000 crore of the annual incremental fund. The monopoly of state-owned SBI in managing provident fund totalling about Rs 2.5 lakh crore had ended with government on Tuesday allowing three private players -- ICICI, HSBC and Reliance Capital -- a piece of the cake.
• While HSBC AMC quoted an asset management fee of 0.00063%, ICICI’s fee was 0.00075%. Both SBI and Reliance Capital quoted 0.01%. The four finalised AMCs will manage the annual funds of around Rs 30,000 crore. They will also render custodial services for maintaining the previous investments, currently held by SBI.
• Reliance Capital is one from the four asset management companies (AMCs) selected to manage the Employees’ Provident Fund (EPF) corpus. HSBC AMC, ICICI Prudential AMC and State Bank of India (SBI) are the other three.
• Reliance Capital provides corporate advisory services like project finance, management of issues for raising capital and managing exposure to currencies and interest rates. It is also involved in custodian and depository activities, asset management, insurance, and real estate development.
  

Now let see how Left is blaming UPA for the selection of Reliance Cap as one of the Fund Manager?

• The Congress on Wednesday defended the decision to get new fund managers, including Reliance Capital, for the Employees Provident Fund claiming the proposal was pending since December 2004.
• "The party favours maximum returns for those who have money in the EPF. Now, there would be greater flexibility in managing the funds for higher returns," said Congress spokesman Abhishek Singhvi.
• Singhvi said there were limitations in the way money was invested earlier, now there would be more flexibility. Asked if the "reform" became possible only after the Left withdrew support to the UPA government, the spokesman said, "to an extent it is true".
• He however added that all aspects of the issue were looked into and only then a decision was taken. Replying to charges that making Anil Ambani-led Reliance Capital as one of the fund managers was a "pay back" in lieu of the support extended by the Samajwadi Party to the UPA government during the July 22 trust vote, Singhvi said "Do you see it as a pay back?"
• Earlier the CPI-M politburo had said that the selection of Reliance Capital as one of the fund managers is an indication of the cost of support to this tainted Government. "The proposal was lying since the end of 2004 and even then Reliance Capital was in the picture," Singhvi said. He indicated that the company got it on merit and the support of the SP to the Congress during the trust vote did not influence the decision.
  
  - HBJ Capital Team