Notification of changes to underlying funds of Kotak funds
20 Jan 2025
- L81 Kotak India ESG (USD)
- Z56 Kotak India ESG (USD) *
(Affected Mirror Funds 1-2)
- L82 Kotak India Midcap
- Z57 Kotak India Midcap *
(Affected Mirror Funds 3-4)
We have been notified by Kotak Funds (the “Company”) of changes to the underlying funds of the Affected Mirror Funds 1-4. These changes took effect on 17 January 2025 (the “Effective Date”).
Change of name and amendment to investment policy - Affected Mirror Funds 1-2
As of the Effective Date, the name of the Kotak India ESG fund, the underlying fund of Affected Mirror Funds 1-2, has been changed to the Kotak India Growth Fund.
This is following recent guidelines issued by the European Securities and Markets Authority (“ESMA”) on fund names using Environmental, Social and Governance (“ESG”) or sustainability-related terms. The ESMA guidelines impose restrictions on funds with ESG in their name, including constraints on the permitted investable universe for such funds.
The Company is of the opinion that the scope of the guidelines is significantly restrictive as to affect the way the underlying fund is managed currently, and to limit the investment opportunities for the Investment Manager of the underlying fund. The Company therefore believe complying with such restrictions may have an adverse impact on the performance of the underlying fund of Affected Mirror Funds 1-2 in future, and have taken the decision to modify the name of the underlying fund accordingly. Affected Mirror Funds 1-2 have therefore also been renamed :
| Affected Mirror Fund name before Effective Date | Affected Mirror Fund name after Effective Date |
| L81 Kotak India ESG (USD) | L81 Kotak India Growth (USD) |
| Z56 Kotak India ESG (USD)* | Z56 Kotak India Growth (USD) * |
The investment policy of the underlying fund of Affected Mirror Funds 1-2 has also been amended as of the Effective Date, in order to update the list of exclusions applicable to the underlying fund.
The core investment objective, strategy and risk weighting of the underlying fund is not changing. The continuing aim is to provide long-term capital appreciation by investing at least two thirds of the underlying fund’s total assets in equity and equity linked securities of companies registered in India or deriving a significant portion of their business from India with an ESG overlay.
Please refer to the Appendix 1 opposite for details of the updated investment policy following the Effective Date.
Amendment to investment policy - Affected Mirror Funds 3-4
The investment policy of the underlying fund of Affected Mirror Funds 3-4 has been amended as of the Effective Date, in order to update the list of exclusions applicable to the underlying fund. The core investment objective and risk weighting of the underlying fund is not changing. The continuing aim is to provide long term capital appreciation by investing at least two thirds of the underlying fund’s total assets in equity and equity linked securities of mid-capitalisation companies registered in India or deriving a significant portion of their business from India.
Please refer to the Appendix 2 opposite for details of the updated investment policy following the Effective Date.
The changes to the Affected Mirror Funds 1-4 have happened automatically in policies. Policyholders do not need to take any action as a result of the change if they wish to remain invested in the Affected Mirror Funds.
Should you have any questions regarding these changes, please contact the Investment Marketing team.
For more information on Kotak funds, please visit the Kotak SICAV website
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*Fund applicable to Hong Kong Offshore designated policyholders - These are policyholders who did not sign their FPIL policy application in Hong Kong, however, their policy was processed through our Hong Kong branch. They can invest in SFC and non SFC-authorised funds.
