Franklin India Taxshield (G) outperforms the Sensex over all time periods

Background: Franklin Templeton Assets Management (India) Pvt. Ltd. Is a wholly owned subsidiary of Templeton International Inc.set up in February 1996. Franklin is one of the largest financial services groups in the world, based in California, USA. It has over 50 years experience in international investment management with offices in over 29 countries. The fund house manages assets worth Rs. 30773.1 crore at end of November 2007.

Franklin India Taxshield (G) is an open-ended tax-planning scheme launched in April 1999.The objective of the scheme is to provide medium to long-term capital growth along with income tax rebate. The minimum investment amount is Rs.500 and in multiples of Rs.500 thereafter. The unit NAV of the scheme was Rs.189.77 as on 5 December 2007.

Portfolio: The total net assets of the scheme increased by Rs.84.63 crore to Rs.613.35 crore in October 2007.

Franklin India Taxshield (G) took fresh exposure to seven stocks in October 2007. The scheme has purchased 5.00 lakh units (1.76%) of Hindustan Construction Company, 1.40 lakh units (1.73%) of Tata Motors, 1.00 lakh units (1.19%) of Patel Engineering and 6.00 lakh units (1.12%) of Gujarat NRE Coke among otheres in October 2007.

The scheme completely exited from Reliance Capital by selling 1.00 lakh units (3.00%), Satyam Computer Services by selling 1.50 lakh units (1.26%), Dr Reddys Laboratories by selling 72502 units (0.89%) and Reliance Petroleum by selling 3.00 lakh units among others in October 2007.

Sector-wise, the scheme took fresh exposure to Automobiles - LCVs / HCVs at 1.73% and Oil Drilling / Allied Services at 0.29% in October 2007.

Sector-wise, the scheme exited completely from Power Generation And Supply at 0.12% in October 2007.

The scheme had highest exposure to Larsen & Toubro with 99,762 lakh units (6.90% of portfolio size) followed by Bharti Airtel with 3.73 lakh units (6.12%), Reliance Industries with 1.33 lakh units (6.06%)and Housing Development Finance Corporation with 1.19 lakh units (5.38%) among others in October 2007.

It reduced its exposure to Cummins India by selling 92428 units to 4.75 lakh units (by 1.59%), Axis Bank by selling 75000 units to 1.50 lakh units (by 1.00%), Geojit Financial Services by selling 8.20 lakh units to 3.54 lakh units (by 0.73%) and Hindustan Unilever by selling 80991 units to 5.00 lakh units (by 0.72%) among others in October 2007.

Sector-wise, the scheme had highest exposure to Banks - Private Sector at 15.36% (from 16.06% in September 2007), followed by Telecommunications - Service Provider at 8.64% (6.75%), Electric Equipment at 8.24% (7.59%) and Engineering - Turnkey Services at 6.90% (5.31%) among others in October 2007.

Sector wise, the scheme had reduced exposure Finance & Investments to 0.26% (by 3.73%), Engines to 3.086% (by 1.59%), Computers - Software - Large to 2.55% (by 0.86%) and Entertainment / Electronic Media Software to 1.08% (by 0.83%) among others in October 2007.

Performance: The scheme outperformed the category average over most of the time periods. It has outperformed the Sensex over all time periods.

Over three-month period ended as on 5 December 2007, the scheme posted 30.19% returns underperforming the category average of 30.55%. It outperformed the Sensex during the same period that posted 27.79% returns.

Since inception, the scheme posted 1856.43% returns outperforming the category average of 806.08%.