Tarakki Times English May 2017

A COMPILATION OF ICICI PRUDENTIAL MUTUAL FUND MEDIA VIEWS MUMBAI | MAY 2017 | PAGES 10 Professional Views InvestInvest cautiously, stocksPg. 2 over-valuedWe're a big believerin infra theme, Cautiouslyprefer power, roads S Naren, ED & CIO ICICI Prudential Mutual FundPg. 3Money flows toIndia will continueif earningsgrowth does Manish Gunwani, Deputy CIO - Equity ICICI Prudential Mutual FundPg. 4 Times of India | 8th May 2017On The Road Nimesh Shah Investors should not chase high returns at this pointLess Travelled MD & CEO ICICI Prudential Mutual Fund ment from institutional investors, category has delivered 40% plus Chandni Gupta, Co-Fund Manager thereby lending a reasonable returns, it does not mean every- Fixed Income Fund ICICI Prudential Asset Mana investment experience over next one should invest in it based on gement Company managing two three years. But since the past one-year return.Pg. 5 director & CEO Nimesh Shah market is already slightly over-Fund Focus: ICICI believes in speaking his mind. priced, one cannot expect A few years ago, the gover-Prudential Top 100 While most market players are abnormal returns. nment was worried about theThe next potential euphoric about the recent rise in huge inflows from FIIs andoutperformer stock market indices, Shah For those investing via SIP , they feared the impact post with- cautions investors against can continue with their invest- drawal. But now mutual funds S Naren, ED & CIO chasing high returns, given that ments because over the next seem to have emerged as an ICICI Prudential Mutual Fund the valuations are high. three years, the investment price effective counter-balance. Has will average out, thereby yielding the domestic MF industryFund Reviews But he is optimistic about the better returns. For someone who matured? medium term prospects and is coming in when sensex is at 30,000 level, can consider To a certain extent domesticPg. 6 insists that mutual funds will be dynamic asset allocation funds institutions have emerged as a the preferred mode of invest- which result in lower equity strong counterbalance. Over theICICI Prudential Balanced ment, given the \"repair work\" in exposure when the equity level is last few months, mutual fundsAdvantage Fund real estate. Excerpts: up and vice versa. and foreigners have pumped inPg. 7 money into stock markets, What should someone looking But it gives you conservative thereby pushing up benchmarkICICI Prudential Long Term to enter the stock market either returns... indices.Equity Fund ( Tax Saving) with cash or via SIP do at thisICICI Prudential Balanced Fund time?Pg. 8 Yes, it does. But it is good to opt However, even if foreign investorsList of ICICI Prudential On a price-to-earnings basis, for conservative returns when were to withdraw tomorrow,Funds in Mint market is over-valued at current sensex is at 30,000 level. Even if Indian MF and insurance industrySystematic Investment Plans levels. Because of the persistent the index were to head higher say which is putting in over $3 billion a flows from both foreign and 33,000 level, the only limitation month, will be able to balance itPg. 9 domestic portfolio investors, the here would be that the entire out, thereby limiting any adverse upside is not captured. shocks.ETW Funds 100 market is currently running a yearSIP Top UP ahead given that earnings per But when market turns volatile at Today, people refrain from share (EPS) is expected to higher levels, this class of funds investing in real estate, gold and Tarakki Corner improve significantly by 2018-19. can limit downside. As we all bank FDs, which is currently acknowledge, there is more pain yielding 6-7% return pre-tax. In Pg. 10 This is because we believe that in losing Rs 5 than the joy in such an environment, equities are over the next twothree years, gaining Rs 30. becoming a TINA factor -there is Harshit Shah capacity utilisation can increase no alternative. So, we believe that ARN : 1690 and so can the return on equity. If you are investing in equity MFs, steady inflows may continue. Ahmedabad one should consider large-caps Currently , the macros are strong because mid-caps are over- How much of small investorMadan Mohan Bhatia but Indian companies are facing valued at present. Continue money is coming into the ARN : 4041 various pockets of challenges. investing but invest with caution market? Moradabad But consumption across the because returns may not be too spectrum is likely to hold strong. high from current levels. Just Mutual fund in India is all about Given this expected improve- because banking funds as a ment, it is likely that there could Contd. on page 7 be a consistent flow of invest-The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

2 TARAKKI TIMES, MAY 2017 Interview We're a big believer in infra theme, prefer power, roads Economic Times | 10th April 2017 S Naren three parameters are kept in the broad infrastructure cycle and they should invest ED & CIO completely low, which is in this theme. So, business prospects cautiously. ICICI Prudential Mutual Fund government 2014-2017, very are good and the number of less amount of money goes into players to take ad vantage of the These are the challenges we areAt a time when markets are gold and instead the money goes business prospects is roughly going to face in the next two totrading at elevated earnings, into financial assets. 50% from what it was 10 years three years.Sankaran Naren, chief invest- ago.ment officer, ICICI Prudential In financial assets, valuation of One has to realise the fact thatAMC recommends dynamic equities is not cheap. India is the We like companies associated getting money to invest inasset allocation, in which fund only country with good and with roads, power and freight- midcycle is superior to gettingmanagers rebalance portfolio by comfortable current account corridor project. In 2018, a money in end-cycle.increasing exposure to under- deficit, fiscal deficit and inflation, second capital expenditure cycleperforming assets and reducing where even today you get 7% on will come and we will see a boom How do you look at disin-exposure to the best ones. a fixed deposit. period for capital goods com- vesment opportunities from anies. We like some of the mid- the government's side?In an interview to Rajesh N We think there is no way such sized cement companies andNaidu, Naren explains why high interest rate can exist if India those companies which will We are very positive on disinvest-infrastructure and financials is a solvent country in the form of benefit from affordable housing. ment initiative from the govern-sectors are expected to do well current account deficit, fiscal ment. We think the centralin the next two to three years and deficit and inflation. When do you see pick-up in government's finances are inearnings would also pick up in earnings? Also what worries good shape.Fy19. So, there is a high likelihood that you about the markets in the interest rates would come down next two to three years? This year, the government hasYou believe it is interesting because of three factors: we are managed to sell two disin-times to have exposure to debt a solvent economy, there is no We expect earnings to pick up in vestments without any major dipside of markets. Could you major capital expenditure, and FY19. There are a few concerns. in prices of any of the stocks.explain your reasons? there is real estate deleveraging Today markets have gone up Also, GST has happened cycle playing out. ahead of earnings. Economic smoothly.The government has made cycle looks very good for the nextinvesting in financial savings A combination of these three few years. We think there is a huge residualmore attractive than physical parameters means lower inter- investment potential available insavings. So, the government has est rates, which is good situation But in the next two years when insurance companies to alsobeen disincentivising investing in to enhance exposure to debt the economic cycle picks up invest in equities.gold by bringing in PAN card side of markets. people will realise that marketsrequirement and launching gold are in line with earnings cycle. Over the past few years, mutualbond schemes. Which themes do you find funds have been investing in particularly attractive? After the earnings catch up with equities but net investment ofAs far as real estate is conc- markets, people will start insurance companies has noterned, almost anywhere in India, We are a big believer in the factoring in the next two years' been significant.residential real estate gives you a infrastructure theme. We believe earnings and will begin accord-rental yield of 2.5%. in the past 10 years, the returns ing to elevated multiples to We think that over the next three of companies in infrastructure earnings which are normal. This years, insurance companies willEssentially, the government is theme have been very subpar. will be a big worry. emerge as one of the keyreducing the amount of money investors in equities.invested in an asset class where We think India requires more I am a big believer in cycles. Inthe return is 2.5%. For example, power, more roads, railways and 2007, the theme of land bank How are you looking at mon-on the second house the gover- other key things that come under played out. In 2015, the e-com soon and GST impact?nment has put a restriction of infrastructure theme. merce industry made use ofmaximum carried forward loss of Gross Merchandise Value (GMV). We need two consecutive goodRs 2 lakh. So, we think infrastructure monsoon periods. We will see theme is likely to do well in the So, I am worried there will be one positive impact of GST inIt has been observed that when next three to five years. The boom and in that boom people earnings in FY19. This is one ofcurrent account deficit, fiscal business prospects of the will start using some topline the key reasons we have a two-deficit and inflation are high, survivors are very good for the measures to justify the markets year view on equities.money goes to gold. If these next three years. (valuation). There can be some transition You look at any sub-sector under Today we are in mid-cycle. I wor- negative impact in the near term. the infrastructure theme. The ry about the end-cycle. Because In the near term, we recommend number of companies, which are in end-cycle it is difficult to dynamic asset allocation fund. solvent and listed, is possibly control investors' greed. half of what we had 10 years ago. But the long-term benefits of the It is equally difficult to convince implementation of the GST could This holds good for other sectors investors that we are in end- be huge.The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Interview 3TARAKKI TIMES, MAY 2017Money flows to India will continueif earnings growth doesET Wealth | 3rd April 2017What are your views on the continue? ably realistic. However, most of Manish Gunwanibroader equity market? Do you this is already discounted by the Deputy CIO - Equitythink it's expensive? Money flows will continue if market. ICICI Prudential Mutual Fund earnings growth does. If you takeTo answer this question, we a medium to long term view, say Which sectors are you bullish on up will be low, allowing things toneed to consider both domestic Sensex vs Sensex EPS chart, now? settle.and global perspectives. From the you can see a fair amount ofdomestic angle, the economy has convergence. We still like some of the themes But you also need to be veryalready stabilised from issues like we favoured in the past 3-4 years. patient with this sector becausecurrent account deficit and trade Though short term money flow These include structural sectors the earnings will not be good indeficit in the past. With most can change the ratio by 10-15%, it like retail-oriented private banks, the next 3-4 quarters.states voting for decisive govern- will ultimately converge. Typically logistics, general and lifements, political stability has also we trade between 12 and 22 insurance, and auto ancillaries. A year ago, everyone wasbeen established. times on the one year forward P/E talking about risks, but not (12-18 is where the market is Since these sectors have already anymore. Why is that?But the growth in GDP numbers is most of the time) and we are done well, the valuations of somenot gaining momentum because roughly at about 18 P/E now. pockets have been stretched. But At this point, the known risks arethe private sector, especially the there are still many stocks with minimal. The only risk that we cancapex from it, has not picked up. If you consider a 3-year or 5-year reasonable valuations. perceive right now is the highThe capex from the government block, most of the return will be market valuation, which will behas had a high year-on-year based on earnings growth and From a cyclical perspective, we under pressure if the expectedgrowth for the past 2-3 years, but the changes in price to earnings like corporate banks (private and earnings growth doesn't come.based on what is budgeted for can only give 8-10% of the top 2-3 PSU banks) that have2017-18, the increase in govern- returns. good current and savings account In that case, certain risks canment capex is not very high. ratio (CASA). emerge suddenly, and we need to be ready for them.The tailwind from it has also What do you anticipate for This is because the asset qualitystarted getting diluted. Global corporate earnings growth in issues arising from sectors infra Do you have any concernsgrowth, which supports domestic 2017-18? side, steel, etc. have peaked and about teething troubles in thegrowth in several sectors like IT, with a healthy CASA, they should GST roll-out?metals, etc. also did not happen. How will it impact the market? We have good earnings power in the anticipate an earnings growth of coming years We are in touch with severalSince economic and political 15-20% in 2017-18, but this is . companies on this and theirstability has not translated into only because of the very low base What is your view on the cut- responses are mixed. Mostcorporate earnings, the equity in 2016-17, due to several one-off throat competition happening companies say they are ready, butmarket is looking expensive on factors like the jump in credit in the telecom sector? some consultancy companies arethe basis of earnings. But if you costs for several banks due to RBI of the opinion that there will beconsider parameters like price to changing norms, and demonet- We are comfortable with tele- teething issues.book, assets or replacement cost, sation, which affected the com, because the sector'sit's not very expensive. cement and auto sectors. dynamics are changing now with This is because GST is a very big consolidation. If you take a change and the way companiesWhat about valuations in the Since the year-on-year growth for medium to long term view, this file documents varies. There aremid cap space? these sectors will be good, 15- sector is good, because the around 5-7 steps in a distribution 20% earnings growth at the incremental capital entering the chain and everything has to tallyBetween large caps and midcaps, broader market level is reason- sector and new capacity coming across the value chain.mid cap indices have done verywell and as a result of this, the The entire transaction can suffervaluation there is expensive on an issues if one entity do not file itaggregate basis. properly. Since the stock market consists of very large companies,Our view is that there will be a The stock market consists they must be ready, and anyconversion between large caps of very large companies teething trouble associated withand mid caps valuations. So on an which shouldn’t be affected the roll-out of the GST should notaggregate basis, I would say that by teething troubles in affect them.the large cap space is better than GST roll-out.the mid cap one.Having said that, it's important tonote that the mid cap universe isvery wide and it has a multitude ofstocks that are reasonably valued.What about the global issues?Will the money flows to IndiaThe information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

4 TARAKKI TIMES, MAY 2017 Interview On The Road Less Travelled Fund management requires diverse talents and a few women, who have the skills, are carving out a niche for themselves Business World | 25th April 2017 Chandni Gupta Chhajjer considers fixed income demonstrated zeal and rigour to standably huge. But Gupta has a Co-Fund Manager, a much lower risk than equities, learn and more importantly, different take on the pressure Fixed Income Fund where it’s possible to suffer improvise further on the already faced by a fund manager. losses. “In debt products over a established stringent processIn the stereotypical world of longer period of time,” says she, driven ways of investment, “The pressure is not on perfor-fund-management, male fund “it is very unlikely that you’d which the fund house is known mance, but on thinking differ-managers usually get splashed suffer a loss unless you come up for. ently, thinking better and,across newspapers — but where against a credit event.” “Yes, consequently, improving theare the women? Morningstar duration too poses its own risk Says Gupta, “I was passionate processes so that the outcome isreported recently that women but over time,” Chhajjer says, about investments and was on better,” says she.were under-represented and adding, “the coupon takes care the mutual fund Sell side forconstituted a mere seven per of duration risks. Also, as MFs quite some time. Thanks to the What aids in this journey is thecent of fund managers. Women invest in a diversified pool, credit opportunities that came my way, ability to constantly review one’smanage altogether Rs 2,320 risk is diversified.” I had the break to grow into work over and over again. “Onebillion, which constitutes about bigger roles. Based on my has to be able to look at the last15 per cent of assets under Chhajjer reckons that she would- performance, the company ten hours every day,” says Gupta,open-ended funds. Yet, very little n’t be able to do any other job as thought I could take up the “knowing that you have tho-is known of them. she only knows how to manage present role — and here I am.” roughly enjoyed them. money. “When you look at better After starting in sales in 2006,In the field of finance, many yields in fixed income,” says she, Gupta took to pursuing higher When she came into the worldleading women are running “you ultimately think only of how studies and completed the CFA of money management,multi-billion-dollar financial you can better your perfor- programme in 2010. Meenakshi Dawar started re-businesses. So when it comes to mance.” searching and selling stockfund management, women are She soon joined the products ideas. But soon the IIM graduateprobably equal to, or even better Asked what she’d be doing if she team of ICICI Prudential MF. “Our realised that fund managementthan men. BW Businessworld didn’t manage a fund, Chhajjer focus here was more goal- was what she would like to doscouted out some low-profile quips that she would probably be oriented; hence, the emphasis and moved to the other side ofwomen fund managers, who in the kitchen, cooking. Says she, has always been not to work for the business, where daily netmanage funds that were not so “I love my work and love mana- short-term returns but to conc- asset values (NAVs) and per-small. ging money.” entrate on long-term goals,” says formance are cherished. Gupta. For the young co-fundAnju Chhajjer, senior fund She also looks constantly at how m a n a g e r, m a n a g i n g f i x e d - Says Dawar, “When I startedmanager, Reliance Mutual Fund, to better returns, saying that it income funds has been an working on equities, it naturallygrew up in a family of chartered was the biggest motivator. “Your exhilarating experience. sparked my interest because it’saccountants. So, for her, the fund has to be one of the best a dynamic role, and you areworld of finance always beck- performing,” and so I constantly “I’m extremely happy managing always on your toes, learningoned. Chhajjer stuck to the family see how I can improve perfor- fixed income,” she says, “It’s something new.” As perfor-tradition and mastered the world mance.” more macros than generally mance is closely scrutinised inof finance as well. perceived, making it a very fund management, for Dawar Within a year of joining ICICI interesting subject.” There are the approach is to create one’sShe honed her skills in fixed- Prudential Asset Management challenges as well and the last own style and define theincome fund-management at Company in 2012, Chandni four years have thrown them up parameters to make invest-New India Assurance. For her, Gupta got an opportunity she in myriad ways. A key challenge ments.there was no looking back since. had been long dreaming of and is in constantly improving theFund management, though, working towards — namely, fund process of investment. “There are many moving parts inbrings with it, fresh challenges, management. Initially a part of equities,” she says. “You have toevery day. the products team, Gupta Given that the business is all be one step ahead if you have to quickly rose in the ranks and about investments, the pressure make a significant mark in yourSays Chhajjer, “Every day is a to generate returns is under- performance, and your style hasnew day. There are new things to be unique.” Fund manage-happening every day. Managing \" The pressure is not ment is not an easy business,a portfolio and the responsibility on performance, but on especially when one is managingyou have and the kind of money thinking differently, public monies and all the hardone is managing is huge and thinking better and, work needs at some point, tohumbling. You have to under- consequently, improving reflect on rising NAVs.stand how fixed-income markets the processes so that thework.” outcome is better,” “It doesn’t matter how hard you have worked. In the end, it is all about performance,” says Dawar. “So pressure of daily NAVs is high. But many people get into thinking their investment should start making money next month; that is not how it is.”The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Interview 5TARAKKI TIMES, MAY 2017Fund Focus: ICICI Prudential Top 100 FundThe next potential outperformerWealth Forum | 15th April 2017 ICICI Prudential 2009 2010 2011 2012 2013 2014 2015 2016 2017 Top100 (G) 74.61 17.54 -20.33 32.83 11.38 38.29 -0.64 10.27 (YTD)Fund Return % 13.17Benchmark Return % 75.76 17.95 -24.62 27.70 6.76 31.39 -4.06 3.01 11.79Sensex Return % 81.03 17.43 -24.64 25.70 8.98 29.89 -5.03 1.95 10.65 -0.40 4.29 5.13 4.62 6.91 3.42 7.25 1.38Alpha over benchmark -1.16Fund Size - (Rs. Crs) 391 384 297 422 437 1455 1362 1530 2040 S Naren ED & CIOBenchmark Nifty 50. YTD2017 data upto 13Apr17. Data: ACE MF ICICI Prudential Mutual FundWF: CY16 was a great year for bet against the overvaluation or Naren: We actively review our This may finally consolidate thethe fund in terms of alpha as undervaluation. We have con- portfolio positions and keep an market and in the next threewell as quartile ranking. What tinued to focus on long term eye on opportunities where the years, we may see price stabilityfactors helped drive this gains rather than short term risk-return trade-offs are good. and ARPUs moving up which isperformance? What does your performance. Even our sector While taking investment key indicator of the sector. Weattribution analysis suggest as bets are based on this approach. positions, we seek relatively believe one should bet on suchkey contributors to perfor- While there could be short term undervalued companies or sectors when pricing wars aremance? volatility due to the sector and sectors. And we found corporate going on. stock bets, the fund's goal is to banks to be relatively underval-Naren: One of our key strategies deliver long term performance. ued as compared to the rest of However, if we see returnsin this fund is to generate returns the market. coming far in advance of thethrough active sector rotation. In For instance, in the short term, cycle, we could book profits. In2015, a significant portion of our we believe telecom may not WF: You continue to maintain a fact, if we look at the recent data,portfolio was invested in sectors perform very well but it has still significant overweight position the overall weightage to telecomlike Metals and Utilities, which made it to Top 100's portfolio as in telecom (8% in fund vs 2% has reduced as specific stockwere underperforming then. one of the large holdings. Last for benchmark) amidst the bets have performed and weHowever, we stuck to our con- y e a r, m e t a l s w e r e u n d e r- ongoing price wars and now have booked some profits.viction, and in 2016, the said performing but were still one of consolidation. Some fundsectors did well helping the the large part of the portfolio due managers have quit this sector WF: What is your outlook onperformance of our fund. to fund manager's conviction. booking losses as they believe earnings growth in FY18? The patience paid off as it helped rational pricing is still a long Which sectors do you seeWF: Does peer group perfor- drive the performance of the way away. What factors sustain posting healthy earningsmance put pressure on fund fund. your conviction in this growth in FY18 and whichmanagers to think and act more contrarian call? sectors do you see continuingshort term than they ideally WF: In the last 3 months, you to struggle?would like? How does one have ramped up your exposure Naren: The telecom sector isbalance out doing what is right to banks, where you were going through a phase of Naren: We believe earningsfor the fund's long term perfor- sizeably underweight (from consolidation. With new growth will reflect at the end ofmance vs maintaining desired 12% in Dec16 to 19% in Feb17, entrants, there is also increased next two years. We are unclearpositions in league tables? vs 25% for the benchmark). competition and pressure on the on the earnings growth in FY18. What has changed at the industry. Specially, with bigger While economic cycle looksNaren: When the market margin in recent months to players having entered the reasonably good for the next fewbecomes abnormally over or prompt this move? market, we see the smaller years, market expectations areundervalued, we would like to players at the periphery exiting. already built in. So, as we seeWealth Creation Journey SIP Performance Outperformance Across Time Periods SIP of Rs. 10,000 invested in the fund per month would grow to... 3 5 7 10 15 Since Time Total Amount ICICI Prudential Nifty 50 Years Years Years Years Years Inception Invested (Rs.) Top 100 Fund (Jul 09, 1998)ICICI Prudential 17.0 16.4 12.9 12.6 19.5 Present Yield (%) Present Yield (%)Top 100 Fund 19.7 Value (Rs.) Value (Rs.)Nifty 50 12.8Outperformance 11.0 11.6 8.3 9.1 14.9 6.9 3 Years 3,60,000 4,46,024 15.19 4,07,245 8.61 6.0 4.8 4.6 3.5 4.6 5 Years 6,00,000 9,14,587 17.39 7,89,723 11.26 Performance Across The Years 7 Years 8,40,000 14,53,605 15.7 11,98,856 10.20 2016 2015 2014 2013 2012 2011 10 Years 12,00,000 25,37,918 14.53 19,85,436 9.86ICICI Prudential 9.8 -0.8 38.0 10.5 32.7 -20.3 15 Years 18,00,000 76,92,939 17.67 52,31,045 13.21Top 100 Fund SinceNifty 50 2.8 -4.1 31.4 5.9 27.5 -24.6 Inception 22,40,000 1,54,58,672 17.98 87,76,661 13.02 (Jul 09, 1998)Out-performance 7.0 3.3 6.6 4.5 5.1 4.3 Contd. on page 7The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

6 TARAKKI TIMES, MAY 2017 InterviewICICI Prudential Balanced Advantage Fund:Good Fund in Volatile EnvironmentFY 2017 was a good year for based on dynamic asset all- than Rs 17,800 Crores of Assets the investment strategy.equity investors; the Nifty gave ocation strategy determined by under Management (AUM). Theover 18% returns in the last one Price / Book ratio of the equity expense ratio of the fund is Other Performance Measuresyear and 12% returns in the last market. This means that, the 2.06%. The turnover ratio of thethree months. The January to fund shifts its asset allocation fund is over 400%, but it is On several risk / return parame-March quarter was stellar not from equity to debt when consistent with the investment ters, ICICI Prudential Balancedjust for the Indian equity market, valuations rise and from debt to strategy of the fund. The chart Advantage Fund outperformedbut stock markets around the equity when valuations fall. This below shows the NAV growth of Balanced Fund category.world with risk appetite returning fund, in a way, is a contra fund, ICICI Prudential Balancedto equities in a big way. While which means that fund manager Advantage Fund since inception Dividend Payout Track Recordexperts expect the momentum bets against the current market of the scheme.to be sustained in FY 2018, they trend. The underlying belief in ICICI Prudential Balancedare also wary of uncertainties at a contra-investing is that, most The fund has given more than Advantage Fund has an excellentglobal level. market operators have herd 11% annualized returns since dividend payout track record mentality. They chase assets inception. While this may not over the past few years. TheSince the market is at its all time which are hot which leads to seem spectacular compared to dividend payout history of thehigh, some India watchers are mispricing of assets and sub- top performing aggressive fund over the past 5 yearsis quiteworried about valuations. Rising sequently steep corrections. balanced funds, the investment good. Investors should knowcommodity prices and the objective of ICICI Prudential that, balanced fund dividends areprospect of a “not so good” mon- While the equity allocation of Balanced Advantage Fund is to tax free for investors.soon are also factors which some of the aggressive balanced generate steady (not spectacularcause concern. While there is funds in the market is currently returns) and to limit downside The monthly dividend option ofmore clarity on the actions of the between 65 to 75%, the equity risks. Manish Banthia, Manish the fund has been paying regularFederal Reserve in the short allocation of ICICI Prudential Gunwani and RajatChandak are dividends since May 2013. Theterm, a change in stance by the Balanced Advantage Fund is the fund managers of this monthly tax free dividend yield isFed will worry equity markets. 55% only. The lower allocation to scheme. also quite good. To see theThere is also some uncertainty equity is due to the fact that, the monthly dividend payout trackwith regards to the policy actions rally over the past few months Rolling Returns record of ICICI Prudentialof the US administration. All (as discussed earlier) have Balanced Advantage Fund,these factors may lead to vola- valuations run up sharply. The The rolling returns of ICICI please click on this link, Mutualtility in the year ahead. Volatility contra style of ICICI Prudential Prudential Balanced Advantage Funds Historical Dividends ofaffects different investors in Balanced Advantage Fund immu- Fund will reveal useful character- ICICI Prudential Balanced Advan-different ways. Investors with nizes the fund from volatility istics of the fund performance. tage Fund - Monthly Dividend.high risk appetites are less related downside risks to a cer-affected by volatility, but volatility tain extent. However, investors The 3 year rolling returns of ICICI SIP Returnscan be stressful for investors should note that, this strategy Prudential Balanced Advantagewith more moderate risk toler- will also prevent the fund from Fund outperformed the category The chart below shows returnsance levels. riding the momentum in the average rolling returns from 2008 of Rs 5,000 monthly SIP started market. Therefore, this fund is onwards. Investors should note in ICICI Prudential BalancedBalanced funds are excellent suited to investors with mode- that, the period from 2008 to Advantage Fund, Growth Option,investment option for investors rate risk tolerance. 2017 had 3 bear markets (when over the past 5 years. Bywith moderate risk tolerance, the market fell by more than investing Rs 5,000 monthly, thesince they can generate steady The investment strategy of ICICI 20%). ICICI Prudential Balanced investor would have accumu-returns for the investors and limit Prudential Balanced Advantage Advantage Fund outperformed lated nearly Rs 4.4 lakhs. The SIPdownside risks in volatile market Fund has enabled it to outper- its peers in the bear market return over the past 5 years wasconditions. The other major form balanced fund category in periods and this led to superior nearly 15% annualized.advantage of balanced funds is different market conditions. rolling return performance of thethe capital gains taxation. Bala- Please see the annual returns of fund. Conclusionnced funds with equity allocation the fund versus the hybrid equityof 65% or more are treated like oriented funds (balanced fund) Let us now discuss some other ICICI Prudential Balancedequity funds from a tax perspec- category over the past 5 years. interesting rolling return chara- Advantage Fund has completedtive. Dividends and long terms cteristics of the fund. The 3 year 10 years since inception. Thecapital gains are tax free for such You can see that, ICICI Prudential rolling returns of ICICI Prudential popularity of the fund amongfunds. While there are fairly large Balanced Advantage Fund Balanced Advantage Fund was in retail investors has sky-rocketednumbers of schemes in the outperformed the hybrid equity double digits more than 90% of in the last few years. While thebalanced fund category, the ICICI oriented funds category every the time, irrespective of interim returns of ICICI PrudentialPrudential Balanced Advantage year over the last 5 years except bear market periods. This shows Balanced Advantage is slightlyfund is an ideal investment in 2014, which as most of our that, the fund was able to on the lower side relative to itsoption for investors with mode- readers may know, was a generate steady returns for more aggressive peers in therate risk appetite, compared to momentum year for stock investors over a 3 year invest- category, the stability of returnsmore aggressive schemes in the market in India (due to the Modi ment horizon. In fact, 3 year and outstanding tax freebalanced fund category. election effect). rolling returns of ICICI Balanced dividend track record makes this Advantage Fund was over 15% fund an ideal investment choiceThe equity allocation of ICICI ICICI Prudential Balanced nearly 50% of the times. The for investors with moderate riskPrudential Balanced Advantage Advantage Fund was launched in strong rolling returns perfor- appetite. Investors shouldFund ranges between 30 – 80% December 2006 and has more mance of this fund is a result of consult with their financial advisors if this fund is suitable for their investment objectives.The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Fund Reviews 7TARAKKI TIMES, MAY 2017 One Fund Review ICICI Prudential Long Term Equity Fund (Tax Saving)Mint | March 2017 4,10,000 ICICI Prudential Long Term Equity Fund (Tax Saving) 3,10,000 mint 2,10,000 Nifty 50 Index 3,23,010 1,10,000 50BEST Mint 50 is a curated list of 50 FUNDS investment-worthy funds.ICICI Prudential long Term Equity Fund (Tax Saving) 4,013.8NAV (as on 30 Mar 2017) 323.01Expense ratio (as on 28 Feb 2017) 2.30 82,890Category average expense ratio 2.57 10,000 19 Aug 1999 30Mar 2017(as on 28 Feb 2017) Source: Value ResearchMinimum Investment Base value taken as 10,000 ICICI Prudential Balanced FundMint | March 2017 6,10,000 ICICI Prudential Balanced Fund 1,16,510 5,10,000 Hybrid: Equity-oriented mint 4,10,000 50BEST Mint 50 is a curated list of 50 FUNDS investment-worthy funds.ICICI Prudential Balanced Fund 9,146.73NAV (as on 7 Apr 2017) 114.18 3,10,000 1,01,124 2.29Expense ratio (as on 28 Feb 2017) 2,10,000 7 Apr 2017 2.41Category average expense ratio 1,10,000 Source: Value Research(as on 28 Feb 2017) Contd. from page 1 10,000 use the bank KYC details, thereby 19 Nov 1999 eliminating the duplication of paperwork.Minimum Investment Base value taken as 10,000 The reason why bank KYC shouldInvest cautiously more evolved investors can move challenge now is simplified suffice is because entire industry to value investing, in the East, onboarding process for investors. does not deal in cash transac-small investors; high net worth money can be moved into mutual Today, 85% of our business tions. MFS receive funds via bankindividuals form a very miniscule funds from unorganized sector, comes from existing consumers accounts and at the time ofportion. We are opening nearly there by giving us an opportunity and this shows that the market is redemption the funds are120 offices across smaller towns to show the importance of well- not expanding adequately . As a transferred to the same banksuch as Nadiad (Gujarat) and regulated businesses. fund house, we receive several account. So there is absoluteArrah (Bihar) because we believe queries on our website, but the transparency.that MF is a viable business. conversion rate is dis-heartening. We have come to realize thatWe have ensured that we are Will the recent change in regu- investors are wary of the entirepresent pan-India, including lations push MFS? KYC process. Like insurance,North East. If we can give a better AMCs too should be allowed toalternative to unorganised invest- We are in an infinite market as thement avenues, people can invest. MFS penetration is hardly 4% inWhile people in Gujarat who are the country. The one majorFund Focus: ICICI Prudential Top 100 Fund The next potential outperformer Contd. from page 5the economic cycle turning support the economy. So, we three years or so, we see large has been a consistent outper-favourably, the markets may be think infrastructure theme is caps offer a fairly attractive former in the large cap fundin line with it. We believe likely to do well in the next three investment opportunity. In fact, category.investors should be more cau- to five years. currently large caps hold bettertious after earnings growth value for investors as against Growth they bring to thecome in. WF: Your presentation on this broader markets. The biggest portfolio. Our fund's portfolio is fund bills it as \"The Next advantage of large cap com- a good mix of both large andIn terms of sectors, we are Potential Outperformer\". What panies is the stability and mid cap companies with a skewpositive on infrastructure as a factors drive your belief that growth they bring to the port- to large caps. So for investorsbroad theme. In the past 10 large caps will lead perfor- folio. Our fund's portfolio is a looking to invest in large capsyears, the returns of companies mance league tables and that good mix of both large and mid can consider investing in ICICIin infrastructure theme have your fund is well positioned in cap companies with a skew to Prudential Top 100 Fund, whichbeen subpar. And a developing this space to be an outper- large caps. So for investors has been a consistent outper-nation like India requires more former? looking to invest in large caps former in the large cap fundpower, more roads, railways can consider investing in ICICI category.and other infrastructure to Naren: With the mid & small cap Prudential Top 100 Fund, which space doing well over the pastThe information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

8 TARAKKI TIMES, MAY 2017 Fund Reviewsmint List of ICICI Prudential Funds in Mint50BESTFUNDSMint | April 2017FUND CORE 3-year return (%) 5-year return (%) 10-year return (%) Fund size (Rs cr) 12,535.88LARGE CAP 6,263.55ICICI Prudential Focused Bluechip Equity Fund 17.77 15.97 NA 53.69MULTI CAP 18.11 16.66 14.18 16,433.73ICICI Prudential Dynamic Plan 25.29 19.05 NAICICI Prudential Nifty Next 50 Index Fund 26.68 22.18 18.66 4,013.80ICICI Prudential Value Discovery Fund 7,412.91TAX PLANNING 21.42 18.75 14.75ICICI Prudential Long Term Equity Fund 21.22 18.59 13.33(Tax Saving)EQUITY-ORIENTEDICICI Prudential Balanced FundFUND CORE 3-month return (%) 6-month return (%) 1-year return (%) Fund size (Rs cr)DEBT-ORIENTEDSHORT TERM 0.82 3.53 10.06 9,544.66ICICI Prudential Short Term PlanSystematic Investment PlansA monthly Systematic Investment Plan (SIP) of Rs. 10,000 with an annual Top Up of 10% in these funds has generated returns as stated belowScheme Name 5 Years 10 YearsICICI Prudential Return (%) 13,40,711 48,38,785 Midcap Fund 27.3 18.9ICICI Prudential Return (%) 11,62,441 41,30,825Multicap Fund 20.7 15.9ICICI Prudential Balanced Fund Return (%) 11,19,137 41,51,147 19.0 16.1ICICI Prudential Return (%) 10,86,324 38,78,381 Top 100 Fund 17.5 14.7ICICI Prudential Dynamic Plan Return (%) 10,89,139 38,31,658 17.7 15.4ICICI Prudential Long Term Return (%) 11,15,202 40,96,646 Equity Fund (Tax Saving) 18.9 16.9 ICICI Prudential Return (%) 10,61,126 --Focused Bluechip Equity Fund 16.6 -- ICICI Prudential Return (%) 11,91,766 51,01,503Value Discovery Fund 22.1 20.9ICICI Prudential Balanced Return (%) 10,15,339 36,95,226 Advantage Fund 14.7 13.8Data in CAGR (%) terms and as of Mar 31, 2017The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Fund Reviews 9TARAKKI TIMES, MAY 2017ETW Funds 100List of ICICI Prudential Funds in the Economic Times WealthET Wealth | April 2017FUND Value Research Returns (%) Fund Rating 3-month 6-month 1-year 3-year 5-year 16.9EQUITY: LARGE CAP 21.16ICICI Focused Bluechip Equity Fund 5.82 10.09 24.2 17.13EQUITY: MULTI CAPICICI Prudential Nifty Next 50 Index Fund 11.51 16.54 37.53 24.54ICICI Prudential Value Discovery Fund 6.05 7.64 19.65 23.09 22.1ICICI Prudential Indo Asia Equity Fund 11.28 14.79 31.99 20.77 18.83Systematic Investment PlansA monthly Systematic Investment Plan (SIP) of Rs. 10,000 in these funds has generated returns as stated below Scheme Name 3 Years 5 Years 7 Years 10 Years ICICI Prudential Return (%) 4,73,157 11,52,888 18,48,249 32,05,681 Midcap Fund 19.7 27.3 22.6 18.9 ICICI Prudential Return (%) 4,58,412 9,87,584 15,63,701 27,23,213 Multicap Fund 17.3 20.7 17.8 15.9ICICI Prudential Balanced Fund Return (%) 4,48,235 9,49,221 15,56,968 27,62,662 15.6 19.0 17.7 16.1 ICICI Prudential Return (%) 4,46,471 9,16,977 14,62,405 25,55,857 Top 100 Fund 15.3 17.5 15.9 14.7ICICI Prudential Dynamic Plan 4,43,924 9,20,567 14,61,492 26,61,212 14.9 17.7 15.9 15.4 Return (%)ICICI Prudential Long Term Return (%) 4,34,603 9,47,956 15,25,988 28,80,040 Equity Fund (Tax Saving) 13.4 18.9 17.1 16.9 ICICI Prudential Return (%) 4,34,314 8,96,238 14,27,199 --Focused Bluechip Equity Fund 13.3 16.6 15.2 -- ICICI Prudential Return (%) 4,33,473 10,21,663 17,11,806 35,59,660Value Discovery Fund 13.2 22.1 20.4 20.9ICICI Prudential Balanced Return (%) 4,24,808 8,55,927 13,90,706 24,43,783 Advantage Fund 11.7 14.7 14.5 13.8Data in CAGR (%) terms and as of Mar 31, 2017 The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

10 TARAKKI TIMES, MAY 2017 Tarakki CornerYour YToaur rTaarakkkki CiornCer ornerHarshit Shah The rise of IT made most young Indian minds thinkof it as a customers.ARN : 1690 lucrative career option. Harshit Shah was no different.Ahmedabad Educating is an important aspect of inviting an informed Harshit did his BE-IT from Ganpat University in the year audience. From the past 2 years, conscious efforts have 2007 and started his own venture in 2008 into IT services. been made to educate clients through Investment In 2009, he started working for Mutual Funds and has Awareness Program (IAP). The program is undertaken on a enjoyed the change and experience. quarterly basis. Through this program, he creates conversations around product analysis and goal based On asking him why the shift from IT to Insurance, he says, investment advisory. that being in IT barred him from connecting with people. This profile helps him meet people from different He doesn't believe in creating a cap as it tends to shape backgrounds and professions on a consistent basis, which and limit your approach based numbers. He instead he really likes. believes in capping the income that inspires you to do more work, set reachable goals and keep the focus on He draws inspiration from his parents. His father who was performance over profits. a cashier at a leading bank was also the man who introduced Harshit to people, schemes and sales. His In terms of investment mantras, he suggests that father guided him through the product knowledge and investors should stay away from timing the markets. Apart trainings that over the years helped Harshit build a deeper from that, long-term focus tops the list in his decision understanding on how to better take the legacy forward. making process, when building portfolios for investors. Interestingly his mother initiated a business in 1986 selling postal schemes and Government schemes. This On a concluding note, He believes one needs to keep inculcated in him a habit of people welfare at an early age. working hard and applying new ideas. There are new lessons to be learned regularly in this dynamic industry. In today's fast paced digitally transformed world, can a Consistently engaging with clients when the market is business really create a dent without marketing? Harshit down is a good discipline to follow. tries to manage that. References are the main source of client acquisition, networking and creating a base of loyalMadan Mohan Bhatia, MA in Sociology from Agra would one need marketing efforts when your work speaks Madan Mohan BhatiaUniversity started in the field of advisory as an LIC agent in for you?” He has never introduced himself. It is his clients ARN : 4041Moradabad in UP. He worked in the field of General who always approach him. In terms of investor education, MoradabadInsurance for more than 2 years, after which he worked in he ensures the necessary training needed to educate andLIC as a Business Development officer, creating a empower the customers. He believes it is important forconsistent record of being at the top in Meerut Division for clients to understand different products and their benefits.20 Years. Having a good hold into business with a requiredIn 1991, he started as a consultant and made remarkable knowledge He has been honored several times by the Srgrowth as a consultant garnering multi-crore business for Divisional Manager of LIC Meerut. His asset book is overhis associates . Over the years, he has continued to Rs 150 Crore. He endorses mutual funds as they have theestablish new milestones of business records one after potential to deliver reasonable returns with tax efficiency.the other, Later on his wife and his eldest son along withwife, joined him into business vigorously and formed a In terms of recognition, he has been Member ofconsortium known as “M.M. BHATIA & ASSOCIATES”. CHAIRMAN'S CLUB - LIC & Member of MDRT USA continuously for last 25 years. He has also qualified forDuring his journey, Bhatia realized that agents lack in COURT OF TABLE - USA. To the aspiring young Indianproviding services to their clients. On the other hand, he professionals, he would like more and more of them to joinenjoyed serving the community. His efforts to help clients this profession, as he finds it to be one of the mostmake the most of their wealth are unmatched. lucrative options. “If you wish to pursue it, do it with passion and innovation” He concludes.He draws inspiration from his wife who always motivatedhim to do better, and from his clients. He adds, “Clientsalways inspire you to do better work. When theyappreciate your work, it is extremely satisfying.”When asked him on market efforts he questioned, “WhyThe information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Tarakki Times is compilation of articles published in various newspapers/magazines. Due credit isgiven by disclosing the source for such articles/publication. The articles covered are excerpts of publication by an independent agency and is circulated to the empanelled Advisors/Distributors ofICICI Prudential Asset Management Company Limited (the AMC). ICICI Prudential Mutual Fund (the Fund) does not warrant the accuracy, reasonableness and/or completeness of any information.All data/information used in the preparation of this material is specific to a time and may or may not be relevant in future post issuance of this material. The AMC takes no responsibility of updatingany data/information in this material from time to time. The AMC (including its affiliates), the Mutual Fund, The Trust and any of its officers, directors, personnel and employees, shall not liable forany loss, damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this material inany manner. The sector(s)/stock(s) mentioned in this communication do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position inthese sector(s)/stock(s). The recipient alone shall be fully responsible/are liable for any decision taken on this material.For over a decade, Outlook Money awards have served as a widely respected benchmark for recognizing excellence in financial services sector for demonstrated leadership and value creation in thedelivery of superior products and services to the consumers. For the year 2016, the areas of focus have been innovation, governance, performance & service.