OVERSEAS INVESTMENT BY MUTUAL FUNDS :

Mutual Funds are permitted to make investment in:

(i) ADRs/ GDRs issued by Indian or foreign companies

(ii) Equity of overseas companies listed on recognized stock exchanges overseas

(iii) Initial and follow on public offerings for listing at recognized stock exchanges overseas

(iv) Foreign debt securities in the countries with fully convertible currencies, short term as well as long term debt instruments with rating not below investment grade by accredited/registered credit rating agencies

(v) Money market instruments rated not below investment grade

(vi) Repos in the form of investment, where the counterparty is rated not below investment grade; repos should not however, involve any borrowing of funds by mutual funds

(vii) Government securities where the countries are rated not below investment grade

(viii) Derivatives traded on recognized stock exchanges overseas only for hedging and portfolio balancing with underlying as securities

(ix) Short term deposits with banks overseas where the issuer is rated not below investment grade

(x) Units/securities issued by overseas mutual funds or unit trusts registered with overseas regulators and investing in (a) aforesaid securities, (b) Real Estate Investment Trusts (REITs) listed in recognized stock exchanges overseas or (c) unlisted overseas securities (not exceeding 10% of their net assets).