The fund, christened Tata Life Sciences & Technology Fund, will primarily invest in five recession proof sectors namely IT, FMCG, pharma, telecom and agrochemical sectors. Initially, 70-80 per cent of the amount mobilised would be invested in the FMCG, pharma and IT sectors.``We are targeting to mobilise an amount of Rs 25 crore in this fund,'' saidAtmaramani.

``The investments would be primarily in equities of a select group of companies in Life Sciences and Technology sectors comprising of engineering, telecommunications, space computers, software, pharmaceuticals, information technology, electronic and electricals, agrochemicals, fertilisers, FMCG and various other allied indsutries among other avenues,'' said the vice-president investments of Tata Mutual Fund, Aspi T Contractor.

According to Contractor, although the three sectors have taken a beating in the current rally on the bourses, they are sure to grow by 20-25 per cent per annum for the next three to four years. According to him, the IT sector, which is worth Rs 6300 crore has grown by a CAGR of 52.60 per cent over a period of five years and with IT spending and internet being only 1 per cent of the GDP, the industry is expected to do well.

Atamaramani reflecting on the reasons for the growth of the mutual fund industry said that effective marketing, imrpoved fund management skills,wide range of products, better after sale services are contributing to a better outlook towards the fund industry.

Atmaramani informed that Tata Finance Ltd had picked up a 22 per cent stake in the asset management company and would be instrumental in marketing the products of the mutual fund. Tata mutual fund is sponsored by Tata Sons Ltd and Tata Investment Corporation Ltd with a 80 per cent stake with Tatas and 20 per cent with Dresdner RCM Global Investors Holdings (UK).

Umbrella funds are increasingly finding favour with asset managements. In recent times, the umbrella fund by Tata is the tird in the row after Unit Trust of India and SBI MF launched their products last month. ``Instead of launching five funds separately, an AMC can launch five different plans under one fund which saves on marketing cost, time and management,'' said an analyst.

While the earlier umbrella funds had a combination of debt and equity or equity and balanced plans, AMCs are now offering sector-specific equity plans underthe umbrella fund. Players like UTI, which have relatively marginal investments in the growth sectors, have introduced pharma and IT plans in its umbrella fund. The Trust has also introduced a brand plan under the fund. While SBI MF's multi-sector fund offere investments in the three growth sectors of IT, pharma and FMCG, it also has a contra fund which will invest in stocks which are out-of-favour with investors.