Reliance Capital to launch Shariah-compliant funds in Malaysia
Reliance Capital Asset Management's Malaysian arm today announced the launch of its first Shariah-compliant products, including an India Fund, from next week.
Being schemes adhering to Shariah laws, the money generated will not be invested in any instruments that carry interest rates.
The asset management company will launch two Islamic funds, Global Equity Fund and India Country fund, Reliance Asset Management Malaysia (RAMMY) said in a statement.
"We will launch the India Country fund next week and the Global Equity Fund by the end of July," Reliance Capital CEO Vikrant Gugnani told PTI.
According to Shariah or Islamic law, the receipt or payment of interest is barred, in addition to speculative activities such as gambling, among others.
He said the funds would basically target institutional investors and the AMC would also come up with products for retail investors.
"Targeting the institutional investors is the first step we have taken. We will come up with products for retail customers in next two years," he added.
RAMMY will be the flagship venture in the Islamic asset management business of Reliance Capital.
RCAM is the largest fund house in India with average assets under management of Rs 1.19 lakh crore. RCAM has over 72 lakh investors. The 37 fund houses in India currently manage assets worth Rs 8.03 lakh crore.
Both the funds will be managed from Malaysia by RAMMY. However, for the India Fund, the AMC will appoint a local company as investment advisor, the statement said.
"Islamic finance is a serious niche business for Reliance... Over time, we aim to create a sizable business and help establish Malaysia as the global hub for Islamic asset management," RAMMY CEO Ian Lancaster said.
The company will seek asset management opportunities in government-linked companies (GICs) and the private sector, the statement added.