If you watch television, you just cannot miss the colourful, new fund offering advertisements by mutual funds talking about India's growing economy and how investing in them is likely to fetch great returns.

But what you are likely to miss is the disclaimer - "Mutual fund investments are subject to market risks, read the offer document carefully before investing" - which is read out at a breakneck speed.

As per the Securities and Exchange Board of India rules, this disclaimer is a must for every mutual fund product advertisement.

And, while following the stipulation, the advertisers apparently try to keep the public from hearing it by resorting to speed reading.

However, a Sebi circular issued today is set to change all that. Sebi has mandated that with effect from April 1, 2008, the time for display and voice over of the standard warning be enhanced to five seconds in audio visual advertisements. In case of audio advertisements, the standard warning shall be read in an easily understandable manner over a period of five seconds.

"The rapid-fire manner in which the standard warning is recited in the audio visual and audio media renders it unintelligible to the viewer/listener," the regulator said on Wednesday, pulling up the mutual fund industry.

This is the first investor-friendly move by Sebi after C B Bhave took over as its chairman on February 18.

Currently, the disclaimer takes around two or three seconds in a 10 or even a 20-second spot.

An average mutual fund advertisement is about 10 to 30-second long.

Mutual funds say that the Sebi move is likely to push up fund marketing costs of asset management companies by 20 to 50 per cent since half of the time in a 10-second ad and one-sixth of the time in a 30-second ad will be devoted to the mandatory disclaimer from April 1.

For instance, if a 10-second ad costs Rs 100,000, Rs 50,000 would be spent on making the disclaimer.

"While the move is in the investor's interest, we feel that there should be a level-playing field between banks, insurance companies and mutual funds. In a 10-second advertisement, if 5 seconds are for the disclaimer, then what will it communicate?" said Jaideep Bhattacharya, chief marketing officer, UTI Mutual Fund.

Interestingly, insurance companies use "Insurance is a subject matter of solicitation" to market insurance products that also include unit-linked insurance plans.

There are no rules mandated by the Insurance Regulatory and Development Authority on its duration. "Even the Hindi version of the line that insurers use is short. This order of Sebi is further making us uncompetitive," pointed out the marketing head of another fund house.

However, the advertising fraternity does not think that the Sebi circular will affect advertising revenues.

"This measure does not bring down the ad spends of mutual funds since the financial services sector is booming right now. Creatives will have to be well-crafted to make sure there is no monotony," said Pratap Bose, chief executive officer, Ogilvy and Mather India.

Advertising preferences will also remain unchanged despite the cost factor since each kind of media targets a particular market but the 10-second advertisement may become unviable for mutual funds.

"Mutual funds have been advertising on television because they get value for money and, as such, this will have no impact on advertising revenues derived from mutual funds," said Joy Chakraborty, network sales head, Zee Network.

It was in 2005 that the capital markets regulator came out with a circular which asked mutual funds to carry the disclaimer along with advertisements in all media.

Sebi had then said that the disclaimer "shall be displayed on the screen for at least two seconds in a clearly legible font size, covering at least 80 per cent of the total screen space and accompanied by a voiceover reiteration.

The remaining 20 per cent space can be used for the name of the mutual fund or logo or name of the scheme, etc."