Mutual Fund Review - ICICI...

Mutual FundReview

October 20 2009 | Mutual Fund October 20 2009 | Mutual Fund October 20 2009 | Mutual Fund

November 19, 2009 | Mutual Fund Mutual Fund Review March 20, 2018

ICICI Securities Ltd. | Retail MF Research

Note: Whenever, returns for the scheme are shown in the report, they are for the growth option of the scheme.

Mutual Fund Review

Equity Markets .................................................................................................... 2

Debt Markets ....................................................................................................... 3

MF industry synopsis .......................................................................................... 4

MF Category Analysis ......................................................................................... 5

Equity funds..................................................................................................... 5

Equity diversified funds ...................................................................................... 6

Equity infrastructure funds ................................................................................. 7

Equity banking funds .......................................................................................... 7

Equity FMCG Funds ............................................................................................ 8

Equity Pharma funds ........................................................................................... 8

Equity Technology Funds .................................................................................... 8

Exchange Traded Funds (ETF) ......................................................................... 9

Balanced funds ............................................................................................. 10

Monthly Income Plans (MIP) ........................................................................ 11

Arbitrage Funds ............................................................................................. 11

Debt funds ..................................................................................................... 12

Liquid Funds …………………………………………………………………..13

Income funds .................................................................................................... 14

Gilt Funds……………………………………………………………………...15

Gold: Outlook anchored to Fed movement ....................................................... 16

Model Portfolios ................................................................................................ 17

Equity funds model portfolio ......................................................................... 17

Debt funds model portfolio ............................................................................ 18

Top Picks ........................................................................................................... 19

March 20, 2018


Page 2

Equity Markets

Update

After making new highs in January 2018, Indian equity markets have

been under pressure since then. The BSE Sensex is down around 8%

while midcaps are down around 12% from their highs in January 2018

Indian markets fell in line with global markets as higher rate hike

expectations from the US Fed along with a sharp rise in bond yields

hampered investors sentiments

Concerns over a sharp rise in bond yields and its impact on treasury

income of the banking sector, which is already reeling under NPA

pressure, especially PSU banks, further impacted market sentiments

The recent quarterly results were among the best in terms of overall

performance. Sensex companies (ex-banks) posted a robust Q3FY18

performance partly due to the low base due to demonetisation in the

base quarter i.e. Q3FY17 and adapting of the trading channel to the new

GST regime. Quarterly results are encouraging thereby depicting an

upbeat domestic economic sentiment (also depicted by November-

December 2017 IIP numbers) thereby reinforcing our view of a smart

earnings recovery being under way. At a broader level, for the entire

listed universe, sales & PAT growth was at an encouraging double digits

on a YoY basis at 11.1% & 13.3%, respectively. A critical analysis of the

same depicts growth led by large cap companies vis-à-vis small cap &

midcap domain. It also aids our belief to be cautious while investing in

small & midcap companies and sticking to more quality names that

exhibit capital efficiency and have sustainable growth

Outlook

Overall, we believe the recent correction is an opportunity to enhance

allocation to equity markets as improving fundamentals in terms of GDP

& earnings growth, domestic liquidity and reforms remain. Globally

also, economic growth is improving across regions although to a varied

degree. In an improving global growth environment, equities may

remain a preferred investment destination. However, given the rise in

markets in the last few years, it is better to stagger buying at every

lower level. Midcap funds should be avoided from a lumpsum

perspective with multicap funds forming a larger proportion of the

equity portfolio

Time and again it has been seen that those who invest during market

volatility or market corrections are rewarded. Investors trying to time

the market by redeeming or not investing during volatility or a market

correction, lose out on the benefit of accumulating at lower prices

Volatility is a blessing in disguise for investors and provides them an

opportunity to accumulate at lower levels. Allocation to equities should

be increased during a downtrend to extract benefits from lower prices

This is not to say investments made during volatile times would pay off

immediately. Ultimately equity investments should be made only with a

horizon of at least five years, if not more, in mind. However, if an

opportunity presents itself intermittently to accumulate at lower levels,

taking advantage of it could benefit immensely when combined with a

long holding period

Nifty 50: Markets at all-time highs

7500

8000

8500

9000

9500

10000

10500

11000

11500

12000

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Source: Bloomberg, ICICIdirect.com Research

Secular dip in market indices …

-1.8

-1.9

-1.9

-1.9

-2.4

-2.8

-6

-4

-2

0

2

Sensex

BS

E 1

00

BS

E 2

00

BS

E 5

00

BS

E M

idcap

BS

E S

mall cap

Source: Bloomberg

One month returns till March 15, 2018

IT the sole sector to not be in the red …

3

-2

-2

-3

-3

-3

-4

-5

-7

-10

-8

-6

-4

-2

0

2

4

6

IT

FM

CG

Auto

Oil n G

as

Bankin

g

Real Estate

CG

Healthcare

Metals

Source: Bloomberg

One month returns till March 15, 2018

Research Analyst

Sachin Jain

[email protected]

Jaimin Desai

[email protected]


Page 3

Debt Markets

Update

The fixed income market continued to see selling pressure in February

with yields across segment rising further to the extent of 20-30 bps

The Indian fixed income market remained under pressure especially

longer dated securities with G-sec yields continuing to inch upwards

due to concerns arising from rising inflation, fear of fiscal slippage,

rising international crude oil prices and higher global bond yields

Indian markets have been under severe pressure since August 2017 on

the back of a sharp rise in global commodity prices particularly crude

oil, lower GST collection rising fiscal deficit concerns and the

government announcing additional borrowing. Global markets were

also weak during 2017 as sovereign yields across the globe witnessed a

reversal from historic lows. Lack of buying support from banks and

exhaustion of FPI limit also added to the already weak sentiments. The

10-year G-sec yield has moved up more than 120 bps since August

2017

The corporate bond market during the same period, however, has

remained more resilient with yields across durations in AAA and AA

rated bonds moving up in the range of 60-70 bps during the same

period. The volatility in yield has historically been far lower in corporate

bonds compared to government securities

Inflation has risen sharply since the second half of 2017 with prints for

December 2017 and January 2018 coming in above 5%. CPI inflation is

expected to average around 4.5% for FY19, marginally above RBI’s

median term target of 4.0% but well within the range of 2-6%. Hence,

we believe that although on the margin it has increased, it is still not in

an alarming trajectory to warrant a significant hawkish monetary policy

Outlook

We do not expect a reversal in the interest rate cycle in the near future

and expect the RBI to keep repo rates unchanged at 6.0% at least in the

near term

The recent up move in G-Sec yield with 10 year yield moving to around

7.70% is more of a retracement of bullish positioning as investors

adjust from a declining rate cycle to a prolonged status quo phase in

benchmark rates

Historically, 10-year G-Sec yield spread over repo ranges between 40

bps and 120 bps for most of the period. We believe the current spread

of 170 bps will narrow down once negative sentiments fades. Corporate

bond spreads are also likely to be at historic low levels as investors

search for higher accrual in a stable interest rate environment

The 10-year G-Sec spread of around 170 bps over the repo rate is far

above the long term average spread indicating the market is already

discounting multiple rate hikes by the RBI

Short-term accrual debt funds with mix of AAA/AA/A rated papers and

low expense ratio offer a better investment option

G-sec yields dip slightly back towards 7.50%

6.0

6.4

6.8

7.2

7.6

8.0

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Yie

ld (%

)

Source: Bloomberg

G-sec yield curve: Yields dip for shorter maturities

6.52

7.15

7.50

7.63

6.60

7.17

7.48

7.57

6.0

6.2

6.4

6.6

6.8

7.0

7.2

7.4

7.6

7.8

1yr 3yr 5yr 10yr

Yie

ld (%

)

15-Mar-18 15-Feb-18


AAA corporate bond yield curve rises for longer

durations

7.66

7.91

8.05

8.38

7.67

7.47

7.88

8.25

6.4

6.8

7.2

7.6

8.0

8.4

8.8

1yr 3yr 5yr 10 yr

Yie

ld (%

)

15-Mar-18 15-Feb-18



Page 4

MF industry synopsis

MF industry AUM shrunk ~0.9% in February 2018 to ~| 22.2 lakh crore

of the total MF corpus. Total ~36% was held by income funds, ~44%

by equity and equity-oriented funds and ~17% by money market funds

According to Amfi data, systematic investment plans (SIPs) inflows for

February were at ~| 6400 crore, down from ~| 6600 crore in the

previous month. SIP inflows average ~| 5300 crore per month in FY18

against ~| 3600 crore per month in FY17, a rise of ~47%. The number

of SIP folios has increased from 1.35 crore in March 2017 to 2.05 crore

in February 2018

In 2017, the MF industry recorded net inflow of | 2.44 lakh crore, of

which | 2.42 lakh crore came into equity and equity-oriented funds

Till February 2018, inflows into equity and equity oriented flows in FY18

were averaging ~| 21000 crore per month, more than double that in

FY17. January saw a net inflow of ~| 20700 crore in such funds

Exhibit 1: Monthly inflows into equity-oriented funds average ~| 21,000

in FY18 till February…

1000000

1200000

1400000

1600000

1800000

2000000

2200000

2400000

Feb-1

7

Mar-

17

Apr-

17

May-1

7

Jun-1

7

Jul-17

Aug-1

7

Sep-1

7

Oct-

17

Nov-1

7

Dec-1

7

Jan-1

8

Feb-1

8

Total AUM

Source: Amfi

Exhibit 2: AUM of Top 10 AMCs

306,463

302,488

248,546

247,060

216,078

153,067

131,442

104,821

85,416

78,179

50000

100000

150000

200000

250000

300000

350000

400000

ICICI

HD

FC

Aditya

Birla

Reliance

SB

I

UTI

Kotak

Franklin

DS

PB

R

Axis

AUM

Source: ACE MF

Exhibit 3: SBI has highest proportion of equity AUM as percentage of its

AUM

48%

47%

44%

43%

38%

38%

36%

35%

31%

31%

0%

20%

40%

60%

80%

SB

I

Fra

nklin

DS

PB

R

HD

FC

ICIC

I

Axis

UTI

Reliance

Kota

k

Adit

ya B

irla

Equity % Debt% Others%

Source: ACE MF. Data as of January 2018

Exhibit 4: Equity funds witness significant inflows in FY18…

-2000

4000

10000

16000

22000

28000

34000

40000

46000

52000

58000

64000

EQ

UIT

Y

BA

LA

NCED

OTH

ER

ETFs

ELS

S - E

QU

ITY

GO

LD

ETFs

GIL

T

Source: ACE MF. Data as on January 2018


Page 5

MF Category Analysis

Equity funds

Technology funds emerged as the best performing category of

sector funds. This category along with FMCG, infrastructure as well

as banking funds continued to outperform pharma funds by wide

margins. IT funds have staged a comeback over the last six months

but pharma funds dragged once again, returning -6.5% on a one-

year basis

In terms of market cap-based funds, midcap funds continued their

dominance over large cap funds. Overall, midcap funds were

among the best performing equity fund categories on a one-year

basis

Structural industrywide problems continue to plague pharma funds.

Pharma stocks delivered a muted performance in Q3FY18 amid

persistent pressure over pricing, compliance issues and a fear of

shrinking growth in the large US market.

Exhibit 5: IT funds outperform other categories on one year basis while pharma funds continue to

be under pressure (returns as on March 16, 2018)

S

27.3

24.0

19.2

16.4

13.8

11.5

9.2

-6.5

6.7

13.6

13.7

10.2

9.7

7.2 8.5

-2.7

17.1

17.1

25.7

17.5

17.9

14.6

12.7

14.6

-10

-5

0

5

10

15

20

25

30

Technology FMCG Mid cap Infrastructure Multi cap Large Cap Banking Pharma

Returns (%

)

1 year 3 Year 5 year

Source: Crisil, ICICIdirect.com Research ; Returns over one year are compounded annualised returns

Exhibit 6: Strong inflows continue into equity, ELSS schemes

0

4000

8000

12000

16000

20000

24000

28000

32000

36000

40000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Net Inflo

w ( | C

r )

Equity + ELSS + ETF

Source: Amfi, ICICIdirect.com Research

Exhibit 7: Robust inflow in equity funds push up AUM to cross | 8.5 lakh

crore

350000

400000

450000

500000

550000

600000

650000

700000

750000

800000

Feb-1

7

Mar-

17

Apr-

17

May-1

7

Jun-1

7

Jul-17

Aug-1

7

Sep-1

7

Oct-

17

Nov-1

7

Dec-1

7

Jan-1

8

Feb-1

8

| lakh C

rore

Equity +ELSS



Page 6

Equity diversified funds

Equity diversified funds witnessed robust growth in the last three

years, with AUM within each sub-category rising substantially. In

the last three years in FY14-17, AUM of large cap funds rose 107%,

multi cap funds AUM rose 90% while midcap funds AUM rose

138%

Over this period, while all three sub-categories delivered a strong

performance (Exhibit 8), midcap funds have done exceedingly well

and outperformed. This is reflected in the trend of broader indices

outperforming bellwether indices over this time frame. However,

large cap funds have reversed that trend at some points during the

past few months

Multicap funds are relatively more market cap agnostic and hold

positions in a wider range of companies than pure large cap funds

or pure midcap/small cap funds. Multicap funds generally hold

around 50-60% of their portfolio in large cap stocks and 30-40% in

midcap stocks. They have benefited by capturing a part of the

midcap rally during this period and, thus, outperformed pure large

cap funds

In the present market scenario, bottom up stock picking across the

market segment is more important than allocation to a particular

segment or sub sector. Multicap funds offer fund managers

flexibility to allocate funds across all market segment and are,

therefore, relatively better placed

Exhibit 8: Blistering AUM growth across all equity diversified fund sub-categories from 2014

41137

41846

73697

73765

105191

152187

65585

64809

121798

113477 165314

231665

13214

13855

40337

41353

68009

95986

0

30000

60000

90000

120000

150000

180000

210000

240000

270000

300000

Feb 1

3

Feb 1

4

Feb 1

5

Feb 1

6

Feb 1

7

Feb 1

8

|crs

Large Caps Multi Caps Mid Caps

Source: ACE MF

Recommended funds

Large cap

Aditya Birla Sunlife Frontline Equity

ICICI Prudential Focused Bluechip Equity

SBI Bluechip Fund

Multi cap

L&T India Value Fund

Kotak Select Focus Fund

Motilal Oswal MOSt Focused Multicap 35 Fund

Midcap

HDFC Mid-Cap Opportunities Fund

Franklin India Smaller Companies Fund

L&T Emerging Businesses Fund

(Refer to www.icicidirect.com for details of the fund)

View

Short term: Positive

Long-term: Positive

http://content.icicidirect.com/newsiteContent/Research/MutualFunds.asp


Page 7

Equity infrastructure funds

Several building materials companies posted a decent performance

across categories on the back of a favourable base effect as Q3FY17

was impacted by demonetisation. Plywood companies, in particular,

recorded a relatively stronger set of numbers

Construction companies had a relatively weaker quarter due to GST

related transition related issues. However, several companies expect a

pick-up in execution in FY19 because of a strong order book and

anticipated improvement in working capital cycle and debt reduction

The demand scenario in real estate continues to remain subdued in

Q3FY18. Going forward, over the long term, with RERA implementation,

a consolidation in the industry is expected which would ultimately

benefit organised players

In its recent Budget 2019 announcements, allocation to roads, highways

and transport increased 16.3% YoY while that to urban development

increased 11.2% YoY. Railways received a bumper push, with

budgetary allocation increasing 32.7% YoY. Consequently, allocation

towards key development related schemes increased 14.1% YoY. A

number of infrastructure related government schemes and the

introduction of new regulatory measures are expected to help

organised players in the infrastructure space over the medium to long

term, placing infrastructure and ancillary stocks on an attractive footing

Infrastructure funds focusing on specific companies capitalising on

growth potential in the sector are offering a good investment option to

investors. Aggressive investors may consider investing in the

recommended infrastructure funds as a part of their thematic allocation

Preferred Picks

L&T Infrastructure Fund Referwww.icicidirect.com

for details of the fund Reliance Diversified Power Sector Fund

Equity banking funds

The magnitude of the fraud unearthed recently and regulatory actions

thereof along with the new framework on resolution of stressed asset

could lead to incremental slippages in the near term. Therefore, credit

cost in the near term could remain elevated, especially for corporate

centric banks. Erosion in net worth and deterioration in capacity is

expected to raise capital and could impact future growth. Overall,

heightened regulatory scrutiny and focus on strengthening operational

system is expected to impact balance sheet growth keeping return

ratios subdued

However, in the long term, we remain optimistic on the banking sector

keeping in mind the anticipated pick-up in credit offtake. Steady

margins and peaking out of the NPA cycle are expected to further aid

profitability. From a long term point of view, the PSU bank

recapitalisation programme is a structural positive. The continued

government push on financial inclusion, enhanced awareness and

increased usage of digital or electronic payments will be positives for

the banking industry from an operating cost perspective

Preferred Picks

ICICI Prudential Banking & Financial Services Refer to

www.icicidirect.com for

details of the fund

Reliance Banking Fund

UTI Banking Sector Fund

View

Short-term: Positive

Long-term: Positive

View

Short-term: Neutral

Long-term: Positive




Page 8

Equity FMCG Funds

FMCG companies witnessed strong growth in the December quarter led

by robust volume growth on account of the low base of the

corresponding quarter impacted by demonetisation. The previous two

quarters were impacted by GST related trade disruption mainly due to

large wholesale network de-stocking and difficulty in coping up with the

new indirect tax regime

We maintain our positive outlook on the FMCG sector backed by the

rural consumption revival led by largely normal monsoons and the

government’s focus on increasing farm incomes. We also expect GST

implementation to eventually provide a big boost to FMCG companies,

particularly those present in personal care and household categories

Equity Pharma funds

The challening environment faced by the US generic space

continued to impact pharma sector growth in Q3FY18. Domestic

formulations growth was also impacted by a slower-than-

anticipated recovery post GST implementation. On the EBITDA

front, an improvement in domestic margins, cost rationalisation and

curbs in R&D spending helped restrict a fall in margins

We have a neutral view on the sector. The US front continues to

face intense competition owing to client consolidation and faster

approval of products. Revenues, margins and profitability could

remain subdued in the near to medium term leading to a cautious

undercurrent for the sector

Preferred Picks

Reliance Pharma Fund Refer to

www.icicidirect.com

for details of the fund

SBI Pharma Fund

UTI-Pharma & Healthcare

Equity Technology Funds

Q3FY18 saw Tier-1 IT companies report muted constant currency

growth as expected since it is a seasonally weak period. Geography

wise, Europe led growth for these companies amid the slowdown in

the US market. BFSI segment (ex-insurance) continued to be under

pressure while energy saw good growth and retail probably

exhibited early signs of recovery. Management guidance for these

companies was hopeful of a better FY19 compared to FY18

We maintain our neutral stance on the sector as the industry faces

challenges related to US immigration rules and growing

protectionism around the world. The industry would continue to

witness pricing pressure in its traditional business, which is

currently unable to offset newer revenue streams from digital areas

that enjoys higher margins

Preferred Picks

ICICI Prudential Technology Fund Refer to

www.icicidirect.com for

details of the fund

Preferred Picks

ICICI Prudential FMCG Fund Referwww.icicidirect.com

for details of the fund SBI FMCG Fund

View

Short-term: Neutral

Long-term: Neutral

View

Short-term: Neutral

Long-term: Neutral

View


Long-term: Positive





Page 9

Exchange Traded Funds (ETF)

In India, three kinds of ETFs are available: Equity index ETFs, liquid

ETFs and gold ETFs

An equity index ETF tracks a particular equity index such as the BSE

Sensex, NSE Nifty, Nifty Junior, etc

An equity index ETF scores higher than index funds on several

grounds. The expense of investing in ETFs is relatively less by 0.50-

0.75% in comparison to an index fund. The expense ratio for equity

ETFs is in the range of 0.05-0.25% while for index funds the expense

ratio varies in the range of 0.50-1.25%. However, brokerage (which

varies) is applicable on ETFs while there are no entry loads now on

index funds

Tracking error, which explains extent of deviation of returns from the

underlying index, is usually low in ETFs as it tracks the equity index on

a real time basis whereas it is done only once in a day for index funds

ETFs also provide liquidity as they are traded on stock exchanges and

investors may subscribe or redeem them even on an intra-day basis.

This is unavailable in index funds, which are subscribed/redeemed only

on a closing NAV basis

In August 2015, the Labour Ministry decided to invest 5% of

Employees’ Provident Fund Organisation’s (EPFO) incremental corpus

in ETFs. The investment in equities is split between the Nifty ETF (75%)

and Sensex ETFs 25%. EPFO chose two ETF schemes of SBI Mutual

Fund — SBI ETF Nifty and SBI Sensex ETF

In 2016, EPFO hiked the limit from 5% to 10% of its incremental

corpus of investment in equities, which was further increased to 15% of

its incremental corpus in May 2017. This is a positive move since

retirement savings, which are long term in nature, will be invested in

equities that have the potential to generate higher returns. So far, EPFO

has invested a total of ~| 22,000 crore in exchange traded funds as of

April 2017

Over 400 ETFs are traded globally. ETFs are transparent and cost

efficient. The decision on which ETF to buy should be largely governed

by the decision on getting exposure to that asset class

Exhibit 9: ETFs record inflows in February after two months of outflows

930

3599

456 5841365 1753 1513

1968 1675

12447

-1604-2234

953

-4000

-2000

0

2000

4000

6000

8000

10000

12000

14000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Net Inflo

w ( | C

r )


Exhibit 10: ETF AUMs remain strong

40147

44436

45899

47584

48359

52823

53734

55166

60107

70041

70353

72879

69848

0

10000

20000

30000

40000

50000

60000

70000

80000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

| C

rore

Other ETFs


Traded volumes should be the major criterion that is used

while deciding on investment in ETFs. Higher volumes

ensure lower spread and better pricing to investors...

Tracking error, though it should be considered, is not the

deciding factor as variation among funds is not huge...

..traded volume should be the major criteria to be

considered while deciding on investment in ETFs.

Higher volumes ensure lower spread and better

pricing to investors...

..tracking error though should be considered but is

not the deciding factors as variation among funds

is not huge...


Page 10

Balanced funds

The balanced funds category continued to receive significant flows,

with average net monthly inflow in 2017 of ~ | 7000 crore

AUM of balanced funds witnessed a stellar increase during this

period, more than doubling to | 174468 crore in February 2018 from

| 77126 crore in the year ago period

Over the last two or three years, the balanced space has emerged

as one of the fastest growing equity categories and offers an ideal

gateway for first time retail equity investors. In FY17, balanced

funds AUM growth outpaced all other categories bar non-gold ETFs

Balanced funds are hybrid funds. More than 65% of the overall

portfolio is invested in equities. Hence, as per provisions of the

Income Tax Act, 1961, any capital gains over a year are taxed at

10%. Also, dividends declared by funds are taxed at 10%

In case one separately invests 35% of one’s investible corpus in a

debt fund, the same will be subject to higher taxation. However, if

the whole corpus is invested in balanced funds, 100% shall have

lower taxation applicable as mentioned above. Thus, balanced

funds offer the benefit of equity taxation on debt component

After a sharp rally in equity markets, the funds can be a preferred

investment avenue as the debt proportion serves to protect on

intermediate relief rallies or the downturn while providing minimum

65% participation on further upsides

Exhibit 11: Inflows into balanced funds slow in February

4,562

5,952

7,136

7,663

7,458

7,864

8,783

8,141

5,897

7,614

9,756

7,665

5,026

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

11000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Net Inflo

w ( | C

r )


Exhibit 12: YoY 126% growth in AUM of balanced funds 77126

84763

93530

102156

109513

121243

128320

134868

147460

155105

167385

176087

174468

13000

33000

53000

73000

93000

113000

133000

153000

173000

193000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

| C

rore

Balanced


Preferred Picks

ICICI Prudential Balanced Fund

HDFC Balanced Fund

Birla Sun Life Balanced 95 Fund

DSP Blackrock Balanced Fund

L&T India Prudence Fund


Investors with a limited investible surplus and a lower risk

appetite but with a willingness to invest in equities can

look to invest in these funds

View


Long-term: Positive



Page 11

Monthly Income Plans (MIP)

An MIP offers investors the option to invest in debt with some

participation in equity, ~10-25% of the portfolio. They are suitable

for investors who seek higher returns from a debt portfolio and are

comfortable taking nominal risk. The debt corpus of the portfolio

provides regular income while the equity portion of the fund

provides alpha. However, returns can also get eroded by a fall in

equities

MIPs can be classified into aggressive MIP and conservative MIP

based on its equity allocation. Risk averse investors should invest in

MIPs with lower equity allocation to avoid capital erosion

The change in taxation announced in the Union Budget 2014, shall

be applicable to MIP funds (refer debt funds section for details)

Preferred Picks

Aditya Birla Sun Life MIP II - Wealth 25 Plan

ICICI Prudential MIP 25

SBI Magnum MIP Fund

SBI Magnum MIP Floater Fund

(Refer www.icicidirect.com for details of the fund)

Arbitrage Funds

Arbitrage funds seek to exploit market inefficiencies that get

manifested as mispricing in the cash (stock) and derivative markets

Availability of arbitrage positions depends very much on the market

scenario. A directional movement in the broader index attracts

speculators in the market while cost of funding makes futures

positions biased

Arbitrage funds are classified as equity funds as they invest into

equity share and equity derivative instruments. Since these are

classified as equity funds for taxation, dividends declared by the

funds are taxed at 10%. Capital gains tax will be applicable at 10% if

they are sold after a year

These funds can be looked upon as an alternative to liquid funds.

However, for these funds, returns totally depend on arbitrage

opportunities available at a particular point of time and investors

should consider reviewing the same before investing. Returns of

arbitrage funds are non-linear and, therefore, unsuitable for

investors who want consistent return across time period

Arbitrage funds should be used as a liquid investment and should

not be a major part of the investor’s portfolio. A range bound

market does not give ample room to create arbitrage positions

Preferred Picks

ICICI Prudential Equity - Arbitrage Fund – Regular

IDFC Arbitrage Fund - (Regular)

Kotak Equity Arbitrage Fund

SBI Arbitrage Opportunities Fund


View

Short-term: Neutral

Long-term: Positive

View

Short-term: Neutral

Long-term: Neutral

MIP should be a preferred debt investment for funds that

need to be parked for over two years




Page 12

Debt funds

Exhibit 13: Category average returns

5.5 6

.6

7.6

3.9

6.4

7.6

6.2

6.4 7.0

0.0

5.0

6.9

-3.7

3.3

7.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

6.0

8.0

10.0

6 months 1 year 3year

%Income Ultra Short Term Income Short Term Liquid Income Long Term Gilt

Source: Crisil, ICICIdirect.com Research

Note : Returns as on March 16, 2018; All returns are compounded annualised

Exhibit 14: G-sec yield curve

6.52

7.15

7.50

7.63

6.60

7.17

7.48

7.57

6.0

6.2

6.4

6.6

6.8

7.0

7.2

7.4

7.6

7.8

1yr 3yr 5yr 10yr

Yie

ld (%

)

15-Mar-18 15-Feb-18


Exhibit 15: Corporate bond curve

7.66

7.91

8.05

8.38

7.67

7.47

7.88

8.25

6.4

6.8

7.2

7.6

8.0

8.4

8.8

1yr 3yr 5yr 10 yr

Yie

ld (%

)15-Mar-18 15-Feb-18


Benchmark 10 year G-Sec has witnessed yields

coming off its highs in March

Interest rates moved up for longer durations across G-Sec

and corporate bond categories


Page 13

Liquid Funds

Yields on money market instruments viz. less than one year CDs

and CPs in which liquid fund predominantly invest, have spiked

over the last three months in the face of reducing liquidity

In an uncertain environment, liquid funds remain well placed to park

money with low volatility

For less than a year, individuals in the higher tax bracket should opt

for dividend option as the dividend distribution tax @ 28.325% is

marginally lower. Also, though the tax arbitrage has reduced, they

still earn better pre-tax returns over bank savings (3-4%) and

current accounts (0-3%)

Changes in taxation rules announced in Union Budget 2014 are also

applicable to liquid funds, as post tax returns in less than a three-

year period get reduced for individuals in the higher tax bracket

(30% tax slab)

Exhibit 16: Call rates below repo rate

5.6

5.8

6

6.2

6.4

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

%

Call rate


Exhibit 17: Short term CP/CD yields spike

5.0

5.5

6.0

6.5

7.0

7.5

8.0

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

%

3M CD 3M CP


Exhibit 18: Flows into liquid funds remain volatile on institutional activity

8,227

-15,147

99,403

-64,692

-12,739

-19,511

21,352

4,833

-13,261

77,408

-127,597

96,552

1,223

-300,000

-260,000

-220,000

-180,000

-140,000

-100,000

-60,000

-20,000

20,000

60,000

100,000

140,000

180,000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Net Inflo

w ( | C

r )


Exhibit 19: AUM remains healthy

386403

399775

415087

428212

450533

467418

468022

484802

468668

469675

496696

520020

543541

300000

400000

500000

600000

700000

Feb-17

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

| la

kh C

rore

Money Market


Preferred Picks

HDFC Cash Management Fund - Savings Plan

SBI Magnum InstaCash

Reliance Liquid Fund - Treasury Plan


View

Neutral



Page 14

Income funds

Benchmark G-Sec yields continued to be under pressure owing to

demand-supply mismatch concerns and fears of fiscal slippage over

lower tax collection concerns. Bond markets continue to remain hit

by weak sentiments owing to a confluence of these factors.

However headline inflation for February (4.44% YoY) provided

some relief, rising rising slower when compared to December and

January prints. The January reading was also below RBI’s revised

projection of 5.1% CPI for Q4FY18. Earlier, the February MPC policy

turned out to be a non-event for the bond markets. RBI highlighted

various concerns over inflation like HRA impact, elevated global

commodity prices on improving global growth, rise in MSP and rise

in customs duty in Budget but maintained status quo on rates. Food

prices moderated in February on the back of easing in vegetables,

sugar and eggs while the percolation effects of HRA implementation

for government employees caused a sequential spike in core CPI

reading.

Short-term funds or short-term funds with some dynamic allocation

to G-sec should be preferred over pure G-Sec funds or long-term

duration funds. Short-term debt funds remain a stable performing

category, especially in the current volatile environment. Credit

funds with reasonable credit quality should be preferred over an

aggressive credit fund

Exhibit 20: Income funds inflows

10,8

64

-56,2

47

34,6

47

5,1

24

-20,6

85

60,0

84

8,3

90

-50,0

90

40,8

45

9,3

74

-60,1

51

-9,8

71

-9,7

99

-80,000

-60,000

-40,000

-20,000

0

20,000

40,000

60,000

80,000

Feb-1

7

Apr-

17

Jun-1

7

Aug-1

7

Oct-

17

Dec-1

7

Feb-1

8

Net In

flow

s

(| .

Cr)


Exhibit 21: AUM remains stable on consistent inflows

783778

794679

743783

780797

792734

778266

845484

858188

809965

855478

867736

808252

801405

400000

500000

600000

700000

800000

900000

Feb-1

7

Mar-

17

Apr-

17

May-1

7

Jun-1

7

Jul-17

Aug-1

7

Sep-1

7

Oct-

17

Nov-1

7

Dec-1

7

Jan-1

8

Feb-1

8

| C

rore

Income


Recommended funds

Ultra Short Term Funds

Birla Sun Life Savings Fund

ICICI Prudential Flexible income

Short Term Funds

Birla Sunlife short term fund

HDFC Short Term Fund

ICICI Pru Short Term Plan

Short Term Funds – Credit opportunities

Axis Regular Savings Fund

Aditya Birla Sunlife Medium Term Plan

L&T Short Term Fund

Long term/Dynamic

Birla Sunlife income plus

ICICI Prudential Dynamic Bond Fund

IDFC dynamic bond fund


View

Ultra-short term: Neutral


Long-term: Neutral



Page 15

Gilt Funds

Benchmark 10-year government bond yields remained elevated

above 7.6% throughout February till mid March (new series). Soft

inflation combined with strong institutional flows into debt markets

helped push down benchmark 10-year G-sec yield by ~45-50 points

in May-July 2017. The markets were not enthused by the widely

expected rate cut in August and lower-than-expected dovish RBI

commentary in October. A significant rebound in July-January CPI

readings was followed by a rise in yields by ~110 bps from ~6.50%

(September) to 7.63% (March 15)

RBI held status quo on policy rates and maintained a neutral stance

in its February 7 policy meet as expected. Headline CPI for February

at 4.44% YoY grew far slower than December and January prints of

~5.1%. The February MPC policy turned out to be a non-event for

the bond markets. RBI highlighted various concerns over inflation

like HRA impact, elevated global commodity prices on improving

global growth, rise in MSP and rise in customs duty in Budget but

maintained status quo on rates. Food prices continued to moderate

in February on the back of easing in vegetables, sugar and eggs

while the percolation effects of HRA implementation for

government employees caused a sequential spike in core CPI

reading

Pressure continued to remain on bond yields in the midst of various

factors such as concerns over demand-supply mismatch of G-secs,

steadily high crude oil prices and elevated international bond yields.

Allocation to pure G-sec or duration funds should be avoided given

their historical outperformance and G-sec yields trading at the lower

end of their historical range. Historically, it has been observed that

years of good returns in G-sec are followed by lower returns

Exhibit 22: Historical trend in return from G-sec indicates, going forward, returns likely to be

lower

-15

-10

-5

0

5

10

15

20

25

30

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

Crisil 10 Yr Gilt Index

%

Source: ACE MF

Preferred Picks

Aditya Birla Sun Life Gilt Plus – PF Plan

ICICI Pru LT Gilt Fund – PF Option


Allocation to pure G-Sec or duration funds should be

avoided given their historical outperformance and G-sec

yield trading at the lower end of its historical range. Crisil

10-year Gilt index has delivered 38% return in the last

three years. It is likely the return will be significantly

decline, going forward

View

Short-term: Neutral

Long-term: Neutral



Page 16

Gold: Outlook anchored to Fed movement

Global gold prices moved within a narrow range in February.

Starting from a base of ~US$1345 per ounce, prices remained

around that level till February 19 before declining towards

~US$1320 per ounce towards the end of the month and staying

thereabouts till mid March. Domestic gold prices fared slightly

better, aided by a depreciation of the rupee against the US dollar

Federal Reserve’s movement on US interest rates has driven the

gold price outlook in the absence of major concerns on the

geopolitical front. The Fed refrained from raising interest rates in

January. There were three hikes pencilled in for 2018 at the

beginning of the year. However strong corporate earnings growth,

low unemployment levels and higher workers’ wages growth had

spiked fears that rebound in inflation would lead to an increase in

the pace of outlined hikes. While the key inflation measure remains

below the targeted mark of 2%, it has firmed up from earlier levels.

As a result, US bond yields hardened appreciably in recent months

US bond yields remained elevated in February ending the month at

2.86%. The 10-year yield had previously jumped by ~13% during

January. Rising US bond yields are sentimentally negative for gold

as it represents a higher opportunity cost of holding the metal,

which bears no interest

Weakness in the US dollar continues to provide support to gold

prices as the metal is denominated in that currency

Gold has historically been looked at as a relatively risk-free asset. Its

price movement both in India and globally, is impacted by any

actual or perceived risk build-up on economic, political or natural

fronts

Exhibit 23: Gold prices flat in February

1100

1200

1300

1400

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Price ($/ounce)


Exhibit 24: Indian prices slightly better on FY18 till date basis

26000

28000

30000

32000

Mar-17

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-1

7

Oct-17

Nov-17

Dec-17

Jan-18

Feb-18

Mar-18

Price (|/10 grams)



Page 17

Model Portfolios

Equity funds model portfolio

Investors who are wary of investing directly into equities can still get

returns almost as good as equity markets through the mutual fund route.

We have designed three mutual fund model portfolios, namely,

conservative, moderate and aggressive mutual fund portfolios. These

portfolios have been designed keeping in mind various key parameters like

investment horizon, investment objective, scheme ratings, and fund

management.

Exhibit 25: Equity model portfolio

Particulars Aggressive Moderate Conservative

Review Interval Monthly Monthly Quarterly

Risk Return High Risk- High

Return

Medium Risk -

Medium Return

Low Risk - Low

Return

Funds Allocation % Allocation

L&T India Value 20 - -

Aditya Birla Sunlife Frontline Equity - 20 20

Franklin India Smaller Companies Fund 20 20 -

SBI Bluechip Fund - - 20

Kotak Select Focus Fund 20 20 -

HDFC Midcap Opportunities Fund 20 20 -

Franklin India High Growth Companies Fund 20 - -

Motilal Oswal MOSt Focused Multicap 35 Fund - 20 20

ICICI Prudential Focused Bluechip Fund - - 20

Reliance Top 200 Fund - - 20

Total 100 100 100

Source: ICICIdirect.com Research

Exhibit 26: Model portfolio performance since inception

19.2%

17.3%

16.2%

13.3%

4%

6%

8%

10%

12%

14%

16%

18%

20%

22%

24%

Aggressive Moderate Conservative BSE 100

%

Aggressive Moderate Conservative BSE 100

Source: Crisil Fund Analyser, ICICIdirect.com Research; CAGR performance as on 28 Feb 2018


Page 18

Debt funds model portfolio

We have designed three different mutual fund model portfolios for different

investment duration viz. less than six months, six months to one year and

above one year. These portfolios have been designed keeping in mind

various key parameters like investment horizon, interest rate scenarios,

credit quality of the portfolio and fund management, etc.

Exhibit 27: Debt funds model portfolio

Particulars

0 – 6 months 6months - 1 Year Above 1 Year

Objective Liquidity

Liquidity with

moderate return Above FD

Review Interval Monthly Monthly Quarterly

Risk Return

Very Low Risk -

Nominal Return

Medium Risk -

Medium Return

Low Risk - High

Return

Funds Allocation

Ultra Short term Funds

Aditya Birla SL Savings Fund 20

ICICI Pru Flexible Income Plan 20

Short Term Debt Funds

Axis Regular Savings Fund 20 20

Aditya Birla Sunlife Short Term Fund 20 20

Aditya Birla Sunlife Short Term Opportunites Fund 20 20

HDFC Short Term Opportunities Fund 20 20

ICICI Prudential Regular Savings 20

IDFC SSI Short Term 20

HDFC Corporate Debt opportunities fund 20

L&T Short Term Income Fund 20 20

Total 100 100 100

Time Horizon

% Allocation

Source: ICICIdirect.com Research

Exhibit 32: Model portfolio performance since inception

8.1% 8.2%8.5%

7.5%7.8%

8.0%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

0-6 Months 6Months - 1Year Above 1yr

%

Portfolio Index

Source: Crisil Fund Analyser, ICICIdirect.com Research; CAGR performance as on 28 Feb 2018

*Index: 0-6 month’s portfolio – Crisil Liquid Fund Index; 6 months-1 year – Blended Index with 50% weight to Crisil

Liquid Index, 50% weight to Crisil Short Term Index; Above 1 year: Crisil Short Term Index


Page 19

Top Picks

Exhibit 33: Category wise top picks

Largecaps Aditya Birla Sun life Frontline Equity Fund

ICICI Pru Focused Bluechip Fund

Kotak Select Focus Fund

SBI Bluechip Fund

Midcaps HDFC Midcap Opportunities Fund

Franklin India Smaller Companies Fund

L&T Emerging Businesses Fund

Reliance Small Cap Fund

Multicaps DSP Blackrock Opportunities Fund

Franklin India High Growth Companies Fund

L&T India Value Fund

Motilal Oswal MOSt Focussed Multicap 35 Fund

ELSS Aditya Birla Tax Relief 96 Fund

DSP Blackrock Tax Saver Fund

L&T Tax Advantage Fund

Reliance Tax Saver Fund

Balanced HDFC Balanced Fund

ICICI Pru Balanced Fund

Aditya Birla Sun Life Balanced 95 Fund

DSP Blackrock Balanced Fund

L&T India Prudence Fund

Liquid HDFC Cash Mgmnt Saving Plan

ICICI Pru Liquid Plan

Reliance Liquid Treasury Plan

Ultra Short term Aditya Birla Sunlife Savings Fund

ICICI Pru Flexible Income Plan

UTI Treasury Advantage Fund-Inst

Short term Aditya Birla SL Short term Fund

HDFC Medium Term opportunities Fund

Kotak Banking and PSU Debt Fund

Credit Opportunities Axis Regular Savings Fund

Aditya Birla Sun Life Medium Term Plan

L&T Short Term Income Fund

Income Funds ICICI Pru Income Fund

Aditya Birla SL Income Plus - Regular Plan

IDFC Dynamic Bond Fund

MIP Aggressive Aditya Birla SL MIP II - Wealth 25 plan

ICICI Pru MIP 25

Equity Funds & Equity-oriented Funds

Debt Funds & Debt-oriented Funds




Page 20

Pankaj Pandey Head – Research [email protected]

ICICIdirect.com Research Desk,

ICICI Securities Limited,

1st

Floor, Akruti Trade Centre,

Road No. 7, MIDC,

Andheri (East)

Mumbai – 400 093

[email protected]

Disclaimer

ANALYST CERTIFICATION

We, Sachin Jain, CA, and Jaimin Desai, CA, Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect

our views about the subject issuer(s) or Funds. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report.

Terms & conditions and other disclosures:

ICICI Securities Limited (ICICI Securities) AMFI Regn. No.: ARN-0845. ICICI Securities Limited is a SEBI registered Research Analyst with SEBI Registration Number – INH000000990.Registered office of I-

Sec is at ICICI Securities Ltd. - ICICI Centre, H. T. Parekh Marg, Churchgate,Mumbai - 400020, India. ICICI Securities is a full-service, integrated investment banking and is, inter alia, engaged in the

business of stock broking and distribution of financial products. ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its various subsidiaries

engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, distribution of financial products etc. (“associates”), the details in

respect of which are available on www.icicibank.com.

ICICI Securities is one of the leading distributors of Mutual Funds and participate in distribution of Mutual Fund Schemes of almost all AMCs in India.

The selection of the Mutual Funds for the purpose of including in the indicative portfolio does not in any way constitute any recommendation by ICICI Securities Limited (hereinafter referred to as ICICI

Securities) with respect to the prospects or performance of these Mutual Funds. The investor has the discretion to buy all or any of the Mutual Fund units forming part of any of the indicative portfolios

on icicidirect.com. Before placing an order to buy the funds forming part of the indicative portfolio, the investor has the discretion to deselect any of the units, which he does not wish to buy. Nothing in

the indicative portfolio constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to the investor's specific circumstances.

The details included in the indicative portfolio are based on information obtained from public sources and sources believed to be reliable, but no independent verification has been made nor is its

accuracy or completeness guaranteed. The funds included in the indicative portfolio may not be suitable for all investors, who must make their own investment decisions, based on their own

investment objectives, financial positions and needs.

This may not be taken in substitution for the exercise of independent judgement by any investor. The investor should independently evaluate the investment risks. ICICI Securities and affiliates accept

no liabilities for any loss or damage of any kind arising out of the use of this indicative portfolio.

Past performance is not necessarily a guide to future performance. Actual results may differ materially from those set forth in projections. ICICI Securities may be holding all or any of the units included

in the indicative portfolio from time to time as part of our treasury management. ICICI Securities Limited is not providing the service of Portfolio Management Services (Discretionary or Non

Discretionary) to its clients.

Mutual fund investments are subject to market risks, read all scheme related documents carefully.

Kindly note that such research recommended funds in indicative portfolio are not based on individual risk profile of each customer unless a customer has opted for a paid Investment Advisory Service

offered by I-Sec.

Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

The information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any

other person or to the media or reproduced in any form, without prior written consent of ICICI Securities Limited. The contents of this mail are solely for informational purpose and may not be used or

considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments or any other product. While due care has been taken in

preparing this mail, I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any inaccurate, delayed or incomplete information nor for any actions taken in reliance

thereon. This mail/report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where

such distribution, publication, availability or use would be contrary to law, regulation or which would subject I-Sec and affiliates to any registration or licensing requirement within such jurisdiction.

ICICI Securities and/or its associates receive compensation/ commission for distribution of Mutual Funds from various Asset Management Companies (AMCs). ICICI Securities host the details of the

commission rates earned by ICICI Securities from Mutual Fund houses on our website www.icicidirect.com. Hence, ICICI Securities or its associates may have received compensation from AMCs

whose funds are mentioned in the report during the period preceding twelve months from the date of this report for distribution of Mutual Funds or for providing marketing advertising support to these

AMCs. ICICI Securities also provides stock broking services to institutional clients including AMCs. Hence, ICICI Securities may have received brokerage for security transactions done by any of the

above AMCs during the period preceding twelve months from the date of this report.

ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its associates or its analysts did not receive

any compensation or other benefits from the AMCs whose funds are mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities

nor Research Analysts and their relatives have any material conflict of interest at the time of publication of this report.

It is confirmed that Sachin Jain, CA, and Jaimin Desai, CA, Research Analysts of this report have not received any compensation from the Mutual Funds house whose funds are mentioned in the report

in the preceding twelve months.

Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.

ICICI Securities or is associates may be holding all or any of the units included in the indicative portfolio from time to time as part of our treasury management. Hence, ICICI Securities or its associates

may own 1% or more of the units of the Mutual Funds mentioned in the report as of the last day of the month preceding the publication of the research report.

Research Analysts or their relatives of this report do not own 1% or more of the units of the Mutual Funds mentioned in the report as of the last day of the month preceding the publication of the

research report.

Since associates of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies/ AMCs including the AMCs

whose funds are mentioned in this report or may have invested in the funds mentioned in this report .

ICICI Securities also distributes Mutual Fund Schemes of ICICI Prudential Asset Management Company which is an ICICI Group Company, scheme details of which might also be appearing in the report

above. However, the transactions are executed at Client's sole discretion and Clients make their own investment decisions, based on their own investment objectives, financial positions and needs..

It is confirmed that Sachin Jain, Research Analysts do not serve as an officer, director or employee of the AMCs whose funds mentioned in the report.

ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.

Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies/funds mentioned in the report.

We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Research Analysis activities.

This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such

distribution, publication, availability or use would be contrary to law, regulation or which would subject ICICI Securities and affiliates to any registration or licensing requirement within such jurisdiction.

The funds described herein may or may not be eligible for subscription in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to

inform themselves of and to observe such restriction.

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