Chola Multi-cap Fund to raise Rs 75cr

The Chola Mutual Fund plans to raise Rs 75 crore from the initial public offer (IPO) of Chola Multi-cap Fund, an open-ended fund that will invest in equity across all ranges of market capitalisation.

The IPO of Chola Multi-cap Fund, which was launched on December 14, 2004, will be open till January 10, 2005.

"We hope to raise Rs 75 crore through the IPO," Sashi Krishnan, chief executive, Chola Mutual Fund, told a news conference.

Making a case for equity investments at the current share prices, especially after the stock indices touched new heights, Krishnan said the price-earnings (P/E) ratio of the stock market was only at 13.5%, which was less than the 10 year average of 15%.

"The markets look attractive even now," Krishnan said.

The Multi-cap Fund would be the country's first fund to have defined asset allocation for all ranges of market capitalisation, Krishnan said.

The large-cap and mid-cap exposure of the fund will be maintained between 25-75% while the small-cap stocks will not exceed 15%, Krishnan said.