JPMORGAN INDIAN INVESTMENT TRUST PLC

(the 'Company')

Strategic Update:  Enhanced discount control mechanisms, the introduction of a dividend distribution policy and investment management fee reduction

This announcement contains inside information

Legal Entity Identifier 549300OHW8R1C2WBYK02

The Board of JPMorgan Indian Investment Trust plc announces that it has undertaken a detailed review of options for the future of the Company, exploring a number of initiatives to help to identify and address the drivers of underperformance and the persistent discount at which the Company's share price trades. The Board has concluded that, in the current environment, shareholders will be best served by the Manager's existing investment strategy and, following consultation with major shareholders, the introduction of a package of robust discount control mechanisms, the adoption of an enhanced dividend distribution policy and a reduction in the investment management fee.

Investment Strategy

As part of the Board's review, constructive discussions were held with the Company's Manager, JPMorgan Funds Limited ("JPMF"), which reiterated its commitment to the Company, and confidence in the investment process and ability to deliver positive relative outperformance in the medium to longer term.

Since assuming management of the Company's portfolio in September 2022, the named Portfolio Managers, Amit Mehta and Sandip Patodia, have focused on a philosophy centred around well-managed businesses with a long-term outlook, guided by a disciplined valuation framework. Whilst relative performance has been disappointing, given the portfolio's focus on quality and growth companies, the underperformance is explained by macroeconomic factors such as interest rate and inflationary pressures which favoured value orientated investments. The Board is reassured that as these factors have eased there has been a recent improvement in relative performance. The material falls in many stocks over recent months have created a number of interesting investment opportunities. Many quality growth stocks which the Portfolio Managers previously viewed as too expensive are now starting to trade at more acceptable valuations, and they have sought to take advantage of this situation.

The Board also took comfort from JPMF's ongoing investment in expanding its proprietary research coverage in India, which now covers 155 Indian companies / c.85% of the market; this is expected to grow to c.90% coverage by the end of 2025.

While the Company's strategy continues to emphasise quality growth companies and a focus on overall risk and beta of the portfolio, the Portfolio Managers have also sought to take liquidity risk in the small and mid-cap ("SMID") part of the market to a greater degree than historically. Utilising the increased research coverage this has resulted in SMID cap exposure increasing over the past two years from c.17% to c.23%.

The Board agrees with JPMF's view that India provides a compelling, long-term investment destination with high-quality companies and management across the country. India's long term growth prospects remain among the strongest in the world, thanks to the rapid growth of its middle classes. This growth will continue to be supported by major structural reforms, including the government's ongoing commitment to infrastructure development.

This belief closely aligns with JPMF's investment philosophy of investing in high quality businesses at attractive prices with the ability to compound at high rates of growth that will deliver both strong absolute returns and outperformance for the Company and reward patient investors over time.

Discount Control Mechanisms

The Company currently has a performance-related conditional tender offer in place for up to 25% of the Company's outstanding share capital, at Net Asset Value ("NAV") less costs, if over the 5 years to 30 September 2025, the Company's NAV total return in sterling on a cum income basis does not exceed the total return of the MSCI India Index in sterling terms, plus 0.5% per annum over the period on a cumulative basis (the "Performance Related Tender").   

While the period over which the performance would be tested has not been completed, the Board proposes to remove the Performance Related Tender and immediately adopt the following discount control mechanisms:

·    A tender offer for up to 30% of the Company's outstanding share capital (excluding shares held in treasury) providing a cash exit at close to NAV less costs (the "First Tender Offer"). The Board anticipates that the First Tender Offer will take place in early Q3 2025 and a shareholder circular will be published in due course.

·    Introduce a commitment to target a single digit discount through active market buybacks, utilising the 14.99% buyback authority approved by shareholders at the AGM in February 2025.

·    Introduce a triennial tender offer for 100% of the Company's outstanding share capital at a 3% discount to the prevailing NAV (the "Triennial Tender Offers"). The Board anticipates the first of the Triennial Tender Offers to be launched in Q2 2028. It is clear from consultation with shareholders that size and scale of the Company are imperative moving forward. The Board therefore reserves the right to withdraw the Triennial Tender Offer if the applications to tender are of a level that the Company would shrink below a NAV of £150m. In this instance the Board would anticipate putting resolutions to shareholders to wind up the Company. In addition, the Board notes that the next continuation vote will be put to shareholders at the Company's AGM to be held in 2029.      

The Board believes that the package of discount control mechanisms with the immediate First Tender Offer, paired with ongoing market buybacks and sight of a future liquidity event in the form of the Triennial Tender Offers will help to significantly reduce the discount. As the performance of the Company rebuilds, the Board would hope the additional proposals will put the Company on a pathway to grow once again. 

Dividend Policy

The Board proposes to pay dividends each financial year totalling at least 4% of the net asset value of the Company at the end of the preceding financial year. Dividends will be paid by way of four equal interim dividends in December, March, June and September each year. The Board believes that the introduction of an enhanced distribution policy, which will be financed through a combination of any available net income in each financial year and other reserves, utilises the investment structure and will differentiate the Company amongst its peers, noting that the Company would be the only Indian Investment Company paying a dividend at this time. The Board is hopeful that the introduction of the dividend will appeal to a wider investor audience and is cognisant of the success other JPMF managed investment trusts have had in attracting additional investor demand for their shares having adopted such an enhanced dividend distribution policy.

In order to introduce a dividend and distribute out of capital, the Company's articles will need to be amended. The Board anticipates seeking shareholder approval to change the Company's articles at the general meeting that will be convened to approve the First Tender Offer. A circular will be published in due course.

The First Tender Offer and the subsequent Triennial Tender Offers are conditional on the adoption of the new enhanced dividend distribution policy and the shareholder approval for the amendments to the Company's articles, to allow dividends to be distributed out of capital.

Investment Management Fee

In addition to the initiatives outlined above, the Board is pleased to announce that the Company's investment management fee arrangements with JPMF will change.

With effect from 1 October 2025 the annual investment fee will be calculated as 0.65% on the first £300 million of the lower of the Company's market capitalisation or net assets and 0.55% in excess of £300 million, instead of 0.75% on the first £300 million and 0.60% in excess of £300 million.

 The Chairman, Jeremy Whitley, commented:

"The Board is pleased to share the outcome from a detailed review of the Company's future strategy, following a challenging period of underperformance. Shareholder feedback confirmed the continued need for a large Indian equity focused investment company, providing exposure to the long-term growth potential of the Indian market. We therefore believe this comprehensive set of proposals, coupled with JPMF's additional investment and commitment to the Company, should help to address the recent performance challenges and the discount at which the shares trade. This is a turning point for JII and as the performance rebuilds, we hope to set the Company on a pathway to grow once again."

19th May 2025

For further information, please contact:

JPMorgan Funds Limited                                            

Simon Crinage

Katie Standley

Will Talkington

0207 742 4000

JPMorgan Funds Limited (Company Secretary)                                         

Sachu Saji

0800 20 40 20 (or +44 1268 44 44 70)

Deutsche Numis

Hugh Jonathan

Vicki Paine     

0207 547 0397