Indices 3rd 30th Change

October October in (%)

2016 2016

Dear Investor,

Samvat 2073 started on a weak note for Indian markets, with the benchmark indices ending marginally lower in Muhurat trading session on Diwali. However, mid and small cap indices ended strong. The key global events like US Federal Reserve meet, uncertainty over global markets and US elections due in the next few days seemed to have influenced the market. However, the market players remain positive on long-term prospects of the stock market.

While the US Fed is likely to keep the rates unchanged in its scheduled meet on November 1-2, its commentary will be keenly watched for hints on whether the rates will be hiked in December 2016. Although Democratic candidate Hillary Clinton appears to be ahead of Republican Donald Trump, the global markets are still on edge given the unpredictability of the election results.

Samvat 2072 saw the benchmark indices Nifty and Sensex gaining 10.4 percent and 8 Percent respectively. Beating the benchmark indices, BSE Mid-cap and small cap indices gained over 20 percent during the same period. Among sectors, BSE Oil and gas, metal, finance and auto indices gained the most, by 19-47 percent.

On the corporate earning front, it's been a mixed bag in the current fiscal. Although a good monsoon, 7th pay commission awards and the government's reform efforts are positives for the economy, the impact will start reflecting over the next couple of quarters. The earnings growth is likely to be led by consumption growth and that should trigger revival of the capex cycle.

On the back of inflation data and slowing growth rate, the RBI cut repo rate by 0.25 percent to 6.25 percent on October 4, 2016. However, it kept CRR unchanged. Since January 2015, the RBI has cut the repo rate by 1.50 percent. However, banks have reduced their lending rates only by around 0.50 percent. Hence, it remains to be seen when banks pass on the benefit of this rate cut. India's consumer inflation fell for the second month in a row at 4.31 percent in September as compared to 5.05 percent in August and 6.07 percent in July 2016. The data raised hopes of more rate cuts in future as the outlook for inflation is benign over the next six months or so.

Despite the hopes of rate cuts in future, investors looking to invest in debt funds will do well to consider investing in funds following accrual strategy as well as dynamic bond funds. For equity fund investors, it is a good time to realign the portfolio. For those who have been investing aggressively in mid and small cap funds, it's time to increase allocation to large cap oriented funds as these stocks are relatively cheaper at the current juncture. However, the overall allocation to each of the segments should be based on one's time horizon and risk profile.

Warm regards,

Hemant RustagiEditor

The Stock MarketPerformanceDuring October 2016.

Sensex 28,243.29 27,930.21 -1.11

MIDCAP 13,482.76 13,473.11 -0.07

SMLCAP 13,122.21 13,583.14 3.51

BSE-100 9,010.51 8,928.20 -0.91

BSE-200 3,784.87 3,759.38 -0.67

BSE-500 11,915.57 11,878.89 -0.31

Registered - R.N.I. No.: MAHENG/2007/19802 • Postal Regd. No.: MCN/72/2016-2018 • Posted at Mumbai Patrika Channel Sorting Office, GPO, Mumbai on 9th & 10th of every month.

Volume 10, Issue 11

November, 2016

A Month ly Publ icat ion f rom Wiseinvest Advisors Private Limited

Price ` 2

Inside Pg No.

“Wealthwise” is a monthly publication brought to you by Wiseinvest Advisors, which is a quality investment advisory firm that specializes in mutual funds. Our CEO, Hemant Rustagi, is a well known personal finance expert. He brings with him an experience of more than 25 years in this field. He regularly writes articles for major national dailies and business magazines as well as appears as a personal finance expert on many investments related TV shows. Besides, our team of advisors has professionals who have spent years in the mutual fund industry. In the last twelve years, thousands of our clients have benefitted from our quality advice and have made mutual funds as the mainstay of their portfolio. You can benefit too from our expertise for your existing as well as new investments. All you need to do is to just call up any of the branches or email your requirements at

and our professional advisors will do the rest.information@wiseinvestadvisors.com

Wealthwise

Address to be affixed here

2What Kind Of FundOne Should Invest Now?

4Performance Of Select Funds

6It's Time To Embrace FinancialPlanning

3Don't Allow Myths To CloudYour Investment Decisions

5Equity Market Update &Outlook

What Kind Of Fund One Should Invest Now?

November 2016 | Page No. 2

Please give feedback about Birla Sun Life India GenNext fund.

Answer : It is a thematic fund and has been doing well. If you believe that there is a place for a thematic fund in your portfolio i.e. you have the risk appetite to invest in such a fund, you can hold this fund in the portfolio.

I have invested ` 40,000 each in four balanced fund direct option SBI, HDFC, TATA & RELIANCE. Are these funds good? I want to invest more ̀ 50,000 where should I invest?

Answer : The balanced funds of these fund houses have been performing well. So you can continue to remain invested in them. Since you already have 4 funds in your portfolio, you can allocate the fresh investment into these funds.

Is it a good time to invest in Midcap and Infrastructure funds?

Answer : Mid-cap funds have been doing well and have the scope to do well even in future provided you choose a fund that has a quality portfolio. Another thing to remember is not to have very high exposure to these funds. As for Infrastructure funds, as the economy improves, these funds should do well. Here again, you must not have a very high exposure.

Sir, should I hold or exit from Reliance Equity Opportunities fund?

Answer : This fund has a long-term established track record. However, it has lagged the peer group over the last one year or so. Considering that the portfolio has been designed to benefit from improving economy, I feel this fund will catch up with the peer group soon.

I have a tax saving fund running as well as one midcap fund. I would like add one or two funds with long time horizon say 5-8 years. Please suggest some funds. I can invest in high risk funds as my goal is Wealth creation to buy home.

Answer : You can consider investing in Kotak Select Focus (a multi-cap fund) and Motilal Oswal Multi-cap 35 fund. Although you have a time horizon of up to 8 years, considering that you will be investing on a monthly basis, the average holding period will be 3-4 years. Hence, it may not be ideal to invest in very aggressive funds.

Hello, Is it right time to invest in debt funds with falling interest rates? Which debt funds will be good for 1 & 3 yrs of time horizon?

Answer : Considering that there is an inverse relationship between interest rates and bond prices, falling interest rates usually provide great opportunities for debt fund investors. However, in the current scenario wherein we have already seen a few rate cuts over the last one year or so, it may not be a good idea to invest in funds that follow duration strategy. For your time horizon, a combination of short term income and income opportunity fund would be ideal.

Dear Sir, I am 46 year old and I have been investing via SIP in three Mutual Funds. My investment details are ̀ 2,500/- pm in HDFC Top 200 from Jan - 2010, ̀ 5,000/-pm in ICICI Prudential Focused Bluechip from May- 2014 and ` 3,000/- pm in ICICI Value Discovery Fund from Dec - 2015. I want to accumulate retirement corpus of ` 1.50 crore and ` 50 lakhs for child education. Are my investment sufficient for achieving my goals? I can invest ̀ 3,000/-pm more. Please suggest fund.

Answer : For your retirement planning, you have a time horizon of 14 years (assuming that you will retire at the age of 60), at an assumed return of 12 percent, you need to invest ` 35,000 per month. You are already investing `10,500 in good quality funds. There is a scope to invest the additional amount in mid-cap and multi-cap funds like HDFC mid-cap opportunity, Franklin India smaller companies and Kotak Select Focus fund. If you don`t

have the entire amount required for investment currently, you must add whatever you can and increase it over time. For creating a corpus for your child`s education, you need to provide the child`s age for me to recommend a strategy.

Sir, My portfolio has 50% Investment in 3 Balanced Funds ( HDFC Balanced/ SBI Balanced/ Tata Balanced Funds all Growth option and the remaining 50% in 4 Mid & Small Cap Funds ICICI Prudential Value Discovery (G), Franklin India Smaller Companies (G), Reliance Small Caps (G) & have a time horizon of 5-7 years. Is it good allocation in current market situation?. Please advise.

Answer : First, your fund selection in both the categories is good. A combination of balanced and mid-cap fund can work, provided you create the right balance in terms of allocation. An allocation of 50 percent to each is fine.

Hi, I am investing in BNP Paribas long term equity fund (ELSS) on a monthly basis for tax savings. How is the fund performing in the present market?

Answer : An ELSS is a good option for saving taxes under section 80C and benefit from the prospects of equity markets. However, this fund has been lagging its peer group in terms of performance and hence my recommendation is to go for Reliance Tax Saver. Since there is a lock-in period of 3 years, you will not be able to move your existing investments out but you can consider this fund for fresh investments.

I want to invest in Franklin India Prima Plus and ICICI Prudential Value Discovery Fund for a time horizon of 12-15 years. How are these funds?

Answer : Both are quality funds and are ideal for a time horizon of 12-15 years.

Hi Sir, SBI Bluechip Fund vs Birla Sun Life Top 100 Fund, which one is your pick for long term goal of 15 years?

Answer : If you have to choose one out of the two funds mentioned by you, my suggestion would be to go for SBI Bluechip fund.

Is investing in small & mid cap a better deal than large cap for 3-4 years ?

Answer: There is a scope to invest in both these segments. However, the key is to have a bias towards large caps in the long run.

I am investing in HDFC Balanced Fund and SBI Bluechip Fund ` 4,000 each. How are these funds?

Answer : Both these are quality funds and hence you can continue to invest in them.

Sir, could u please advise on creating a retirement portfolio / funds / schemes. I am 39 yrs and willing to take risk and want to retire by 60.

Answer : Since you have a time horizon of 21 years, you should be investing in well diversified equity funds. I have already mentioned a few equity funds with long-term track record, you can select a few of them.

I have investments in Axis Long Term Equity Fund (ELSS) over the past 1 and half year. However, returns are not that much great. What is your suggestion? Should I hold or exit?

Answer : It is a good fund. Please note that equity related funds go through phases where there may not do well. However, quality funds always make a comeback and hence you can continue.

Dear Sir, Request kindly let me know some best mutual fund to invest through SIP for 4-5 years

Answer : For a time horizon of 4-5 years, balanced funds will be ideal. I have already discussed a few of them here.

Here is the Transcript of our CEO's chat on moneycontrol.com on 25th October 2016

Page No. 3 | November 2016

Don't Allow Myths To Cloud Your Investment Decisions

Investing in market-linked products can be quite challenging for investors

who are not familiar with them. While it is heartening to see increasing

number of investors making market-linked products an integral part of their

portfolios, there is still a large section of investing public that remains

skeptical about the role these products can play in their wealth building

process.

Investors must know that market-linked products offered by mutual funds

allow them to invest in different asset classes such as equity, debt and gold in a

proportion that may suit their time horizon and risk profile. The fact that there

are variety of funds available for investing in each of these asset classes

wherein fund managers follow different investment philosophies and

strategies makes it easier for investors to design a well balanced portfolio.

However, investors looking to get the best from these funds should not allow

myths to cloud their investment decisions. Here are some of these myths and

how one can tackle them:

No doubt, equity market tends to be volatile over short and medium term.

However, over the longer term, it has the potential to out-perform other asset

classes provided one is willing to stay committed to a pre-defined time

horizon and follow a disciplined investment approach.

The problem here is that if you chase short-term performance, either you will

make your portfolio more aggressive or more conservative than you would

have liked it to be. That's because, in good times, you will be tempted to invest

more in equities and in volatile times in debt funds. Remember, the key factors

are to focus on asset class that suits your time horizon and invest in funds that

are consistent both in terms of following their investment philosophies and

providing returns vis-à-vis their peer group.

While diversification helps in mitigating the risk and volatility, investors need

to realize that mutual funds themselves are diversified investment option. For

example, someone investing in an equity fund gets to invest in a basket of

stocks across market caps and sectors even if investment is as low as ̀ 1,000.

Equity is a risky asset class

Investing in good performing funds guarantees higher returns

Investing in many funds provides higher level of diversification

Therefore, having too many funds may prove to be counter-productive as it

can make monitoring the portfolio more complicated and pull down

performance of the portfolio if some non-performing funds remain in the

portfolio.

Many investors face the dilemma of when to sell their funds. Once they see

healthy returns in the portfolio, they often get tempted to exit from some of the

funds. After exiting, they wait for the market to come down so that they can

invest at lower levels. However, if that doesn't happen, they get tempted to

reinvest at much higher levels and hence end up increasing their average cost

rather than protecting the gains. The right way to book profits, if at all, is to

rebalance the portfolio once a year. Rebalancing of the portfolio is very

effective as it ensures that one stays invested in different asset classes at all

times. Moreover, having a pre-decided interval for this exercise makes returns

more tax efficient.

It is a proven fact that investing through SIP brings in a discipline in one's

investment process as some money is kept aside towards achieving varied

investment goals. Besides, when one invests in an asset class like equity

through SIP, it brings the average cost down and helps in keeping emotions

out of investment process. However, it would be wrong to assume that if one

invests thru SIP, there won't be any losses in the portfolio. The fact is that SIP

minimizes losses in the short term and improves returns in the long-term.

Therefore, every investor who signs up for SIP, must be prepared to tackle

periods of negative returns over short and medium term and avoid making any

abrupt decisions.

Book profits periodically

Investing thru SIP means no losses

A Note To Our Esteemed ReadersWealthwise is being sent to some of you on a Complimentary basis as a part

of our humble effort to ensure that more and more investors get the best from

their investments. We sincerely hope that you would like the contents of

Wealthwise and in some way benefit from it. However, if you do not wish to

receive “Wealthwise” on a regular basis, please let us know either by

sending us a mail on or by calling us

on (022) 65281507. You can also write to us at our Corporate Office address

mentioned on page 6.

information@wiseinvestadvisors.com

November 2016 | Page No. 4

Performance Of Select FundsData as on October 28, 2016

Mutual funds, like securities investments, are subject to market and other risks. As with any investments in securities, the NAV of units can go up or down depending on the factors and forces affecting capital markets.

Please check whether you have received dividend for the fund/s that you may have in your portfolio out of this list. In case, you do not maintain any portfolio statement, Wiseinvest Advisors can do that for you free of charge. Once we have the details, we would send your updated statement every month. You can contact our corporate office or any of the branches to avail of this free service.

EQUITY FUNDSDiversified Fund Launch 1-Month* 3-Month* 6-Month* 1-Year* 2-Year** 3-Year** 5-Year**Axis Equity Fund Jan-10 -1.50 0.05 8.38 5.34 5.98 15.78 14.44Birla Sun Life Frontline Equity Fund Aug-02 -0.33 2.54 15.47 13.07 11.55 21.08 17.01Birla Sun Life Equity Fund Aug-98 1.26 9.78 24.21 22.38 17.34 30.08 20.12BNP Paribas Equity Fund Sep-04 -1.13 -0.80 7.11 5.72 8.48 19.19 15.92Canara Robeco Equity Sep-03 -0.31 3.45 14.34 5.90 6.68 16.38 13.19Franklin India Prima Plus Fund Sep-94 0.36 2.29 11.32 10.34 13.37 25.46 17.69HDFC Equity Fund Jan-95 1.18 4.87 18.99 11.55 6.82 22.87 14.83HDFC Top 200 Fund Sep-96 0.28 3.37 17.31 11.61 6.41 19.66 13.44ICICI Prudential Dynamic Fund Oct-02 -0.10 4.25 14.94 13.32 7.67 18.78 15.37ICICI Prudential Focused Bluechip May-08 -0.52 1.57 13.90 11.35 8.47 18.40 14.77Kotak 50 Regular Plan Dec-98 -1.39 0.24 10.98 7.29 10.25 18.80 13.69Kotak Select Focus Fund Regular Plan Sep-09 0.38 4.31 19.02 15.30 15.27 25.88 19.36L&T Equity Fund May-05 0.01 2.15 15.65 10.05 9.80 21.15 14.38Motilal Oswal MOSt Focused Multicap Apr-14 0.73 6.67 21.07 17.74 23.06 — —Reliance Top 200 Fund - Retail Plan Aug-07 -0.34 2.86 15.70 8.62 8.82 23.11 16.14Invesco India Contra Fund Apr-07 0.57 5.64 15.65 13.86 13.78 30.00 17.97SBI Bluechip Fund Feb-06 -0.30 2.12 13.58 14.02 14.29 23.97 19.12UTI Opportunities Fund Jul-05 -0.70 1.86 12.96 6.70 4.58 15.12 12.78

Sector, Specialty & Tax SavingCanara Robeco FORCE Fund Sep-09 0.92 5.90 22.06 16.67 15.66 24.93 18.64ICICI Prudential Infrastructure Fund Aug-05 0.14 0.55 14.45 4.28 4.63 20.43 9.95Reliance Banking Fund May-03 -0.89 5.31 23.17 17.44 12.43 27.47 17.24Reliance Pharma Fund Jun-04 0.12 5.01 10.81 -5.18 10.64 26.46 21.61Axis Long Term Equity Fund Dec-09 1.09 1.22 13.80 8.62 13.03 29.00 21.71HDFC Taxsaver Fund Mar-96 1.25 5.48 18.19 11.24 6.34 21.96 14.56IDFC Tax Advantage (ELSS) Fund Dec-08 0.63 3.36 14.83 11.68 13.51 22.66 17.33Reliance Tax Saver Fund Sep-05 1.21 5.87 16.43 13.76 8.39 32.60 20.82

Midcap & SmallcapCanara Robeco Emerging Equities Mar-05 1.53 8.60 22.88 17.30 21.10 43.52 27.42DSP BlackRock Micro Cap Fund Jun-07 3.73 10.25 27.04 28.31 29.22 51.71 29.46Franklin India Smaller Companies Fund Jan-06 1.84 6.03 20.54 23.17 21.66 41.59 29.97HDFC Mid-Cap Opportunities Fund Jun-07 0.71 8.57 24.12 22.19 19.81 37.48 24.82ICICI Prudential Value Discovery Fund Aug-04 -0.37 1.04 12.40 9.98 11.98 31.36 22.83IDFC Premier Equity Fund Sep-05 0.83 1.40 12.71 10.78 13.12 27.97 19.18Motilal Oswal MOSt Focused Midcap 30 Feb-14 1.17 7.04 21.99 17.59 24.61 — —SBI Magnum Global Fund Sep-94 -0.07 5.27 12.32 8.71 14.51 30.61 21.46L&T India Value Fund Jan-10 2.74 7.50 23.36 18.18 20.98 34.97 23.77Reliance Equity Opportunities Fund Mar-05 -0.56 0.98 11.54 1.34 5.48 22.88 16.56

HYBRIDEquity, Debt Oriented & Multi Asset ClassBirla Sun Life Balanced '95 Fund Feb-95 0.27 3.33 14.92 14.85 13.63 22.77 16.37Canara Robeco Balance Fund Feb-93 0.80 5.58 15.09 10.93 12.44 21.72 15.93DSP BlackRock Balanced Fund May-99 0.79 6.88 18.05 16.02 15.19 23.43 14.90HDFC Balanced Fund Sep-00 0.77 4.61 14.52 13.30 12.86 24.89 17.19HDFC Prudence Fund Feb-94 2.08 6.32 17.78 13.76 9.94 24.43 15.65ICICI Prudential Balanced Advantage Dec-06 0.24 2.36 11.00 10.08 10.58 17.01 15.91ICICI Prudential Balanced Fund Nov-99 0.14 5.43 16.29 15.17 12.20 22.65 18.08Kotak Balance Regular Plan Nov-99 0.41 4.14 14.43 14.98 10.84 16.23 13.29L&T India Prudence Fund Jan-11 0.75 2.72 13.08 10.75 13.81 23.04 17.53Reliance Regular Savings Fund - Bal Jun-05 0.33 2.90 12.36 10.96 10.74 22.73 16.42SBI Magnum Balanced Fund Dec-95 1.68 3.97 12.37 11.64 13.06 22.92 18.28Tata Balanced Fund - Regular Plan Oct-95 -0.56 2.36 12.57 10.02 13.27 22.95 17.82Axis Triple Advantage Fund Aug-10 0.51 1.60 9.24 11.70 8.40 9.77 8.94Franklin India Dynamic PE Ratio Oct-03 0.15 1.46 7.77 7.96 8.93 13.96 10.78Kotak Equity Savings Fund Oct-14 0.12 1.69 6.27 7.32 7.91 — —

Arbitrage FundsICICI Prudential Equity Arbitrage Fund Dec-06 0.61 1.74 3.47 6.73 7.21 7.77 8.62IDFC Arbitrage Plus Fund Jun-08 0.63 2.00 4.11 6.83 7.10 7.41 8.04Kotak Equity Arbitrage Fund Sep-05 0.66 1.79 3.43 6.65 7.22 7.91 8.43Invesco India Arbitrage Fund Apr-07 0.68 1.75 3.34 6.52 7.20 7.48 7.99

*Absolute ** Annualised. Past performance may or may not be sustained in future.

DEBTIncome, Short Term & Ultra Short Term Funds Funds Launch 1 Week* 1 Month* 3 Months*6 Months* 1 Year* 2 year** 3 Year**Birla Sun Life Short Term Opp. Fund May-03 -0.04 0.50 2.87 6.09 10.72 10.19 10.42Birla Sun Life Dynamic Bond Fund Sep-04 -0.04 0.05 3.24 8.48 12.36 12.61 12.18Birla Sun Life Medium Term Plan Mar-09 0.00 0.66 2.84 5.65 10.18 10.64 10.84HDFC Corporate Debt Opp. Fund Mar-14 -0.03 0.66 3.07 6.00 10.79 10.58 —Kotak Income Opp. Fund May-10 0.02 0.68 3.13 6.01 10.69 10.15 10.13Invesco India Short Term Fund Mar-07 -0.04 0.43 2.48 5.33 8.29 8.65 8.53Invesco India Bank Debt Fund Dec-12 0.09 0.58 1.89 4.03 6.55 7.18 7.57Reliance Regular Savings Fund-Debt Jun-05 0.02 0.81 2.86 5.52 9.91 9.71 9.91SBI Magnum Income Fund Nov-98 -0.08 0.43 3.19 6.98 10.16 10.42 9.54L&T Income Opportunities Fund Mar-15 -0.03 0.59 2.35 4.73 8.25 — —BNP Paribas Flexi Debt Fund Sep-04 -0.05 0.10 3.05 7.39 10.54 11.10 10.55BNP Paribas Money Plus Fund Oct-05 0.07 0.60 1.94 4.04 8.00 8.13 8.30Kotak Treasury Advantage Fund Aug-04 0.10 0.58 1.93 4.12 8.18 8.51 8.87L&T Ultra Short Term Fund Apr-03 0.06 0.60 1.97 4.18 8.49 8.56 8.82UTI Short Term Income Fund Aug-07 0.00 0.57 2.50 5.45 9.16 9.38 9.53Kotak Banking and PSU Debt Fund Dec-98 0.02 0.62 2.76 5.55 9.58 9.27 9.39

Dividends declared by equity and equity-oriented funds duringthe month of October 2016 Scheme name Date Dividend declared in ̀ Per unit

ICICI Pru Balanced Adv - (MD) 03/10/2016 0.07

Tata Balanced Fund - (MD) 07/10/2016 0.49

Edelweiss Arbitrage Fund - (D) 13/10/2016 0.10

ICICI Pru Equity Income Fund - (MD) 14/10/2016 0.04

Kotak Equity Savings Fund - (MD) 14/10/2016 0.05

Tata Equity P/E Fund - (D) 14/10/2016 2.42

ICICI Pru Balanced Fund - (MD) 14/10/2016 0.15

JPMorgan India Equity Income Fund - (D) 18/10/2016 0.25

JPMorgan India Equity Fund - (D) 20/10/2016 0.20

UTI MNC Fund - (D) 20/10/2016 3.50

UTI SPrEAD Fund - (D) 20/10/2016 0.07

L&T India Prudence Fund - (D) 20/10/2016 0.12

ICICI Pru Dynamic Plan - (D) 21/10/2016 2.25

ICICI Pru Indo Asia Equity - (D) 21/10/2016 1.60

L&T Emerging Businesses Fund - (D) 21/10/2016 1.50

HDFC Arbitrage Fund - WP - (QD) 24/10/2016 0.04

Birla SL Frontline Equity - (D) 25/10/2016 2.77

Kotak Equity Arbitrage - (D) 25/10/2016 0.06

Kotak Balance - (D) 26/10/2016 0.08

Edelweiss Prudent Advantage Fund - (D) 27/10/2016 0.10

Canara Robeco Equity Diversified - (D) 28/10/2016 2.70

SBI Arbitrage Oppor. Fund - (D) 28/10/2016 0.05

DSP-BR Balanced Fund - (D) 28/10/2016 0.23

Equity Market Update & Outlook

Page No. 5 | November 2016

Indian equities (S&P BSE Sensex) remained flat (up +0.23%) SENSEX 27865.96 Sep 30 Close 27941.51 Oct 28 Close in October despite the rally at the start of the month. Mid and small caps outperformed the large caps by 2% (BSE Midcap 10500 Sep 30 Close 11300 Oct 28 Close) and 6% (BSE Small Cap 12780.8 Sep 30 Close 13454.03 Oct 28 Close) respectively. Easing India-Pakistan tensions along with the 25 bps rate cut by the Reserve Bank of India enthused market

participants at the start of the month. However, the party was short lived with weak export numbers from China (raised expectations of further devaluation) and US Fed minutes that appeared to make a case for a rate hike in December weighed on market sentiments.

On the macro front, September CPI and WPI came in better than estimates at 4.31% and 3.57% respectively (on account of lower food inflation). Industrial production continued to disappoint in August coming at -0.7%, but was better than the -2.4% registered in July 2016 highlighting concerns on growth.

On the flows side, foreign institutional investors (FIIs) turned net sellers in Indian equities with net outflows to the tune of USD 600 million in October. Domestic investors on the other hand were net buyers to the tune of USD 1 billion partly offsetting the negative impact from FII selling.

On corporate earnings, the Sensex earnings estimates for current financial year have not seen any downgrades on aggregate basis which bodes well going forward. Earnings growth is at an inflection point after 4 years of slow growth. We expect earnings growth at ~11-12% for the current financial year (2016-17) and around 18-20% for 2017-2018 financial year. This is at a time when most other EMs and DMs are facing headwinds on corporate earnings. Despite the rally this year, valuations are reasonable with P/E at 15.5x FY2018 earnings which is closer to the long term averages. India's market cap/GDP is at 75% which is also near its long term average (peak was ~160% of GDP just before the global financial crisis). We, therefore, believe that valuations are reasonable and one should take any volatility in markets as an opportunity to invest from a 2-3 year investment horizon.

After growing at 7.3% in FY2015, we expect GDP growth to further accelerate to 7.5% in FY2016 and 7.8% in FY2017. We also believe that there is further scope for monetary easing by the RBI, despite the 125 bps cut in key policy rates (Repo rate now at 6.25%) in CY2015. India will continue to benefit from the sharp decline in global commodity prices, especially that of crude oil (India imports ~85% of its oil requirement). Declining commodity prices, along with a stable currency, should likely keep inflation under check. While the pace of economic reforms in the past 26 months may have been slower than expected by market participants, we firmly believe that the steps taken by the government are in the right direction. Various initiatives already taken by the government include the direct benefit transfer of subsidies (DBT), energy reforms, ease of doing business, attracting FDI, bank recapitalization etc. The INR has been one of the best performing currencies since the lows of August 2013 (EM currency crisis). We remain confident that the INR will exhibit stability, which should bode well for more foreign

Market Outlook

investments, both in equities and in fixed income. We see higher portfolio flows into Indian equities in 2016 versus 2015. While there has been a significant improvement in the macro-variables (current account deficit, fiscal deficit, IIP), this has not yet favourably impacted corporate earnings, which continue to be under pressure. This could be attributed to lower rural demand (poor monsoons), cross currency headwinds, pressure on global cyclicals and the delay in the revival of the investment cycle. However, we believe most of the above will now act as positive catalysts going forward with normal monsoons recovery in rural demand, commodity prices stabilizing and recovery in corporate earnings. We expect corporate earnings to see a pick up in the second half of FY2016, led by domestic cyclicals and interest rate sensitive sectors. Medium term risks for markets include geopolitical tensions, China devaluation, US Fed rate increase, possible increase in crude oil prices and a global growth slowdown. Having said that, we believe that India is at an inflection point. A strong pick up in corporate earnings growth in FY2017, full transmission of lower interest rates and expanding return on equity (ROE) for corporate India makes us very optimistic about the outlook for Indian equities in the medium term. We remain constructive on Indian equities going into the second half of 2016/17 and believe that the steps taken by the Government will slowly start getting reflected in the real economy and earnings over the next few months.

Jay KothariFund ManagerVice President & Product StrategistDSP BlackRock Investment Managers Pvt. Ltd.

In this material DSP BlackRock Investment Managers Pvt. Ltd. (the AMC) has used information that is publicly available, including information developed in-house. Information gathered and used in this material is believed to be from reliable sources. The AMC however does not warrant the accuracy, reasonableness and / or completeness of any information. The data/statistics are given to explain general market trends in the securities market, it should not be construed as any research report/research recommendation. The data/figures mentioned in this material are generic market updates; the same may or may not have relevance over any of the Schemes of DSP BlackRock Mutual Fund. We have included statements / opinions / recommendations in this document, which contain words, or phrases such as "will", "expect", "should", "believe" and similar expressions or variations of such expressions that are "forward looking statements". Actual results may differ materially from those suggested by the forward looking statements due to risk or uncertainties associated with our expectations with respect to, but not limited to, exposure to market risks, general economic and political conditions in India and other countries globally, which have an impact on our services and / or investments, the monetary and interest policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices etc. All figures and other data given in this document are dated and the same may or may not be relevant in future.

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

Disclaimer

November 2016 | Page No. 6

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Financial planning is the process of making informed money management decisions to secure your future. Financial planning helps to achieve financial goals and meet personal priorities, taking into consideration available resources, responsibilities, risk appetite and lifestyle. A financial plan lays down the allocation of savings across various asset classes to achieve an appropriate risk-reward balance.

Do you need a financial plan?All individuals and families regardless of age or income need a financial plan so that they know that they are saving enough for retirement, education funds or a new home. A financial plan gives you the discipline necessary to save money. A qualified and experienced financial planner can help you plan your investments so that you get the best returns for your risk level by spreading your investments into the different asset classes as well as investment options.

Wiseinvest Advisors is a SEBI registered Investment Adviser (Registration No. INA000000664). To maintain an arm's length distance between our Advisory and Execution services, we have set up a separate department named Investment Adviser Department (IAD).

We can help you achieve your goals by providing comprehensive fee based financial planning and making recommendations of financial products that suit your requirements the most. Our mission is to help you overcome uncertainty and take control of your finances and move confidently towards achieving your goals. The basis of fee calculation is the complexity of the engagement.

Remember, financial planning doesn't have to be an intimidating process. We have qualified and experienced advisers who can make financial planning a simple and fruitful process for you.

Our process:

Step 1: The first meeting provides an opportunity for you and us to get to know each other. You also get an opportunity to decide whether we have the capability to fulfill all your requirements.

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Step 4: Develop your unique financial plan. This will also include the recommended asset allocation and various investment options that suit your needs. While doing this, we also analyze your current investments. We present a final version of your customized financial plan so that you're positioned to move forward.

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