New Star and TATA Asset Management to launch India fund

New Star is pleased to announce a partnership with TATA Asset Management part of the TATA Group, one of India’s largest business conglomerates.

This is a significant collaboration for New Star and TATA Asset Management and precedes the launch of an Indian equity fund in the second quarter of 2008.

New Star and TATA Asset Management are among the most dynamic investment management companies in the UK and India respectively and share a reputation for delivering strong long-term performance for investors.

TATA Asset Management, whose headquarters are based in Mumbai, India, manages in excess of US$6 billion worth of assets across a range of 31 investment schemes. Over the past year, TATA Asset Management’s schemes have won several awards from independent organisations including CNBC-CRISIL and ICRA. Four of TATA Asset Management’s schemes were ranked among the global top 100 over the year ending 31 December 2007 by Lipper.

TATA Asset Management is part of the TATA Group, one of the largest business conglomerates in India. The TATA Group had revenues of US$28.8 billion in 2006/2007, the equivalent of 3.2% of India’s Gross Domestic Product (GDP). The TATA Group comprises 98 operating companies, 27 of which are publicly-listed enterprises. The group operates across several industrial sectors including information systems and communications, engineering, materials, services, energy, consumer products, automobiles and chemicals. Some of the TATA Group’s best known publicly-listed companies include TATA Motors, TCS Limited, TATA Steel, TATA Power and TATA Tea. TATA group has operations in 85 countries across six continents and exports products and services to 80 countries worldwide#. TATA is best known in the UK for its 2007 acquisition of Corus, the steel manufacturer, and the group also owns Tetley Tea.

Following the recent launch of the New Star Heart of Africa Fund in November 2007, the launch of an Indian equity fund is the next step in the expansion of New Star’s emerging market product range. India is a key player in the emergence of a new economic world order. It is the third largest Asian economy and the fourth largest economy in the world on a purchasing power parity (PPP) adjusted GDP basis. The Indian economy has grown at an average annual rate of more than 7% in the decade since 1997 and has posted strong growth in excess of 8% in each of the last three years. Strong economic growth is being driven by a number of favourable factors including:

A large and growing middle class
A well-educated, skilled, English speaking and relatively inexpensive workforce
Strong legal framework and high levels of corporate governance
Strong domestic consumption
Low levels of consumer debt
A reducing federal fiscal deficit
Large infrastructure spending
An attractive outsourcing destination
Positive market sentiment
A stable currency

John Duffield, chairman, New Star Investment Funds, says: “I am delighted to announce New Star’s intention to launch an Indian equity product with TATA Asset Management in the second quarter of 2008. To join forces with such a prestigious company as TATA Asset Management is tremendous news for New Star and our investors. TATA Asset Management’s investment expertise in India is second to none. TATA Asset Management’s competitive advantage combined with New Star’s expertise in the UK makes for a compelling investment proposition in what is one of the world’s most exciting growth markets.”

Mr. Farrokh K. Kavarana, chairman, TATA Asset Management Limited, says: “Earlier this year we made the strategic decision to make our fund management available to UK retail investors and we are very pleased to be doing so in partnership with New Star. It is our view that the combination of the skills and experience of both groups offers UK retail investors an excellent way to access Indian stock markets and India’s growth potential.”