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Tarakki Times English Sep-Nov 2019

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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. A COMPILATION OF ICICI PRUDENTIAL MUTUAL FUND MEDIA VIEWS Professional Views MUMBAI | SEP-NOV 2019 | PAGES 16 Pg. 2 Mutual fund business is not about margins but volume Interview Dalal Street Investment Jounal Oct 28 - Nov 10, 2019 Pg. 3 Expect RBI and Govt frameworks to be supportive of yields The Economic Times | September 24, 2019 Nimesh Shah MD & CEO ICICI Prudential Mutual Fund Pg. 4 Mutual Fund Insight | November 2019 When the economy is in a bad Nimesh Shah decision-making have been the Key challenge shape, invest in cheap stocks to MD & CEO focus on client selection and get good returns in the long run ICICI Prudential Mutual Fund avoiding concentration. This A further simplified KYC - the discipline has helped us not to adoption of bank KYC will enable Mint | October 23, 2019 Many years ago, we instituted an overly rely on credit rating and investments to happen at a in-house independent risk has helped us avoid potential touch of a button. Such a step is Pg. 5 management team entrusted problems considering that, till likely to boost business volume. with overseeing the credit- recently, many of the credits It’s important that investors evaluation and approval proce- currently under stress carried the If the bank KYC were to be continue SIPs for 3-5 years sses. In doing so, we were highest safety rating. accepted, retail investors who probably one of the early movers are already using online banking The Economic Times | October 25, 2019 among the fund houses to have a As part of the credit due can buy mutual fund products risk-management team which is diligence, we consider various with ease. This will provide a Pg. 6 independent of the investment aspects such as financial and huge boost for the mutual fund team and does not have any operating parameters, manage- industry as the reach of the Global recession is not one of the return targets. ment profile, industry outlook, product will see an explosive major points of concern currently competitive positioning, key growth. As India moves to be a The decision to on-board a credit risks and mitigation, etc. These $5 trillion economy, we believe Mutual Fund Insight | November 2019 is taken after due diligence processes have enabled us to there are many investors who are carried out in accordance with deliver superior investment yet to reach the prevailing S Naren the Debt Investment Policy. We experience to our investors. distribution system. follow the ‘four-eyes’ concept for ED & CIO approval of credit investments, Impact of new expense slabs As a leading mutual fund house, with the decision to invest in any we are actively working with the ICICI Prudential Mutual Fund debt instrument being taken Reduction in expense ratios is a relevant authorities to work after in-depth credit review and beneficial step for the investors towards easing the onboarding Tarakki Corner not based on the sole judgement as investors will be increasingly process of a new investor. Pg. 7 of the fund manager. attracted to this low-expense Ashwin Vajani and transparent product. The We have always believed that mutual fund business is not a Ashwin Vajani Advisory credit rating is one of the inputs margin but a volume business. in investment decision but not As long as the investors have a Pg. 8 the sole determinant. good investment outcome with the mutual fund scheme, they Paresh A. Shah Two key tenets of our credit will reinvest. Fund Review If the bank KYC were to be accepted, retail investors PAg. 9 who are already using online banking can buy mutual fund products with ease. IACICI Prudential Regular Savings Fund For investors with a penchant for risk Pg. 10 ICICI Prudential Value Discovery Fund A marathoner, not a sprinter Pg. 11 All-weather Mfs Pg. 14 List of ICICI Prudential Funds in Mint SIP Top UP Pg. 15 ETW Funds 100 Systematic Investment Plans Pg. 16 List of ICICI Prudential Funds in Star Track Mutual Fund

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, SEP-NOV 2019 Interview Interview | Dalal Street Investment Journal Oct 28 - Nov 10, 2019 Nimesh Shah sated, in case the growth returns always believed that the credit consider the performance of at MD & CEO and revenues go up or if the rating is one of the inputs in least three years and above to ICICI Prudential Mutual Fund government proceeds with the investment decision and not the evaluate the fund's performance. divestment process as the equity sole determinant. The two key Moreover, this is one of the few With respect to the recent markets have turned buoyant. tenets of our credit decision- funds among large caps, which announcements made by the This indicates that the bond making have been the focus on has been true to its label since its Finance Minister regarding the market is more likely to remain client selection and avoiding inception. corporate tax rate cut, it is safer range bound in the near future. concentration. This discipline to say that many companies has helped us not to overly rely The 3-, 5-, and 10-year perfor- would be benefiting from it. Looking at the credit events on credit rating and avoid mance of ICICI prudential What would be its impact on happening back to back, what potential problems. Considering multi-asset fund has been overall mutual funds returns in is your take on this? As a fund that many of the currently-under- impressive. How do you look at terms of equity and debt (rise in house, what is your strategy for stress credits carried the highest a multi-asset portfolio? What is yield)? protecting your investors from safety rating till recently. your investment philosophy such events? regarding this portfolio? We believe that the cut in Owing to all these measures, we corporate tax rates is a major We are of the view that NBFC have not faced even a single-day ICICI Prudential multi-asset fund structural reform. A revival in the crisis does not pose any delay in receipt of interest or is a multi-cap, diversified-across- domestic investment cycle is systemic risk. It is important to principal payments on our debt assets scheme, which invests very likely, which could result in note that the concerns, per- investments at ICICI Prudential throughout market capitali- earnings upgrade and re-rating taining to each of the debt mutual fund during our 20 plus zations and various asset of companies that pay full tax papers under question, is years of existence. classes. Equity plays the role of a rate. This development is also confined/limited to specific wealth creator while debt aims to expected to provide a fillip to schemes within select fund As a part of the credit due offer stability to the portfolio and ‘Make in India’ initiative and FDI houses and are not at an diligence, we consider a number provides opportunities for stable inflows by making a way industry-wide level, as it is largely of aspects, such as financial and and consistent returns over a for manufacturing companies, being perceived. operating parameters, manage- longer period. Meanwhile, gold looking to set shop in India, ment profile, industry outlook, that comes with its phases of especially the ones that are Within the industry, we were the competitive positioning, key consolidation and growth, acts shifting away from China. All first to institute an in-house risks, and mitigation. These as a good hedge and aids in these are positive indications for independent risk management processes have enabled us to protecting the portfolio from a long term mutual fund investor team, entrusted with overseeing deliver a superior investment various risks, such as inflation. since these steps will certainly Through active asset allocation, add to India's economic revival. Equity plays the role of a wealth creator the scheme has actively while debt aims to offer stability to the managed its equity levels based Further, the fiscal stimulus portfolio and provides opportunities for on the in-house model. Going measures by the government stable and consistent returns over a forward, the scheme endea- have resulted in an earnings longer period. Meanwhile, gold that vours to continue managing the revision, with the Nifty EPS comes with its phases of consolidation equity levels based on market gaining around 10%. This paves and growth, acts as a good hedge and valuations. The fund has been way for a clear near term benefit aids in protecting the portfolio from the best performer in its category to the equity market due to a various risks, such as inflation. over 3-, 5-, and 10-year basis, substantial rise in corporate beating its peers by a wide earnings. Also, the sentiment credit evaluation and approval experience to our investors. margin. element, which is an important processes. The risk manage- factor for both, the market and ment team is independent of the On a long-term basis, ICICI You have a product, called \"SIP the economy, has improved investment team and does not Prudential bluechip fund has Plus\", wherein you provide life drastically following the event. have any return targets. The been the best in its category. insurance cover on the basis of decision to onboard credit is However, compared to its investor's SIP. How is this From a debt market perspective, taken after due diligence, carried peers, it has witnessed some product more beneficial than the yields had discounted the out in accordance with debt sluggish performance in recent having a separate term marginal spike in fiscal deficit investment policy. We follow the times. What factors will insurance plan and a SIP? thus far. A cut in corporate tax \"four-eyes\" concept for approval you attribute to such a rates is anticipated to lead to of credit investments, with the performance? The SIP Plus facility is an optional larger than expected rise in decision to invest in any debt feature, which allows a unit deficit. However, some amount instrument being taken after in- For the most part of its existence, holder to add an insurance cover of deficit is likely to be compen- depth credit review and not ICICI Prudential bluechip fund while initiating SIP in ICICI based on the sole judgement of has been a top quartile per- Prudential mutual fund schemes. the fund manager. We have former. In equities, one should This is an added benefit for an investor without incurring any additional cost. Nonetheless, this product does not compete with a term insurance. We have seen a very low penetration of passive investments, such as index funds and ETFs among retail Contd. on page 3

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, SEP-NOV 2019 Expect RBI and Govt frameworks to be supportive of yields The Economic Times | September 24, 2019 Fiscal deficit is likely to rise about the happenings in the need to distinguish them into Nimesh Shah owing to the recent announ- NBFC space after the those which are experiencing MD & CEO cements from the Centre. downgrades and defaults. stress and others for whom it is However, some of the revenue Could there be any systemic business as usual. We continue ICICI Prudential Mutual Fund loss is likely to be compensated risk in NBFCs? to have investment in NBFCs if growth comes back and which have been backed by liabilities of the scheme (AUM). revenues go up or if the Given the relatively large size of banks or strong corporate For example in our credit risk government proceeds with the the Indian banking system, a groups. Fund, we have a limit of ?100 PSU bank stake sale as the equity potential Rs 50,000 crore non- crore on investment from single markets have turned buoyant, performing asset may cause pain Given the happenings in the investor. said Nimesh Shah, CEO, ICICI but is unlikely to turn into any debt space over the last one Prudential Mutual Fund to ET. systemic issue. Further, Indian year, investors are sceptical What should an investor look at Edited excerpts: NBFCs are not permitted to about credit risk funds. AMFI while selecting a credit risk invest in complex structured data shows there is outflow fund? Bond yields shot up due to the products, like in the case of from this category. cut in corporate tax rates Lehman, which made it difficult When investing into a debt fund, announced by the finance to quantify the problem. The We believe the panic phase has look for the ‘yield’. If it is too high, minister. Are investors worried stress points such as asset- run its course. Most of the then there could be a possibility about rising fiscal deficit? How liability mismatches are known. headlines have been negative that the fund is exposed to will the finance minister It is said that in the financial around specific debt MFs and so higher risk. This may emanate balance this? markets, what is well-known the sentiment around investing from many factors such as the rarely triggers a crisis. As an into those debt MFs has turned collateral for underlying secu- Fiscal deficit is likely to rise industry, mutual funds are negative. The biggest outcome rities being weak or when the owing to the recent announce- unlikely to face a domino effect. of these developments has been firm has inadequate cash flows. ments from the Centre. Investors in individual schemes the focus on risk management Hence, a debt fund manager has However, some amount of deficit that held these bonds have faced and portfolio diversification in to conduct diligence to ascertain is likely to be compensated if NAV write-downs. debt fund. These events have asset quality and cash-flows growth comes back and reve- also highlighted that just as before reaching an investment nues go up or if the government So is it safe to put money in volatility is an integral part of decision. An ideal fund is the one proceeds with the PSU bank NBFC debt? equity investments, rating in which the investments made stake sale as the equity markets upgrades and downgrades are are spread across companies have turned buoyant. We believe There are a wide variety of part and parcel of credit from diverse sectors. Concen- that going forward the RBI and companies operating in the investments. There is a need to trated debt funds which are the government will come up space, of which some are differentiate between ratings invested in few sectors or a high with frameworks which are backed by a strong corporate downgrades. A downgrade from degree of exposure to a single supportive of bond yields and group or a bank. Each of these “AAA” to “AA” has entirely group pose significant risk to there could be open market companies possesses a unique different connotation than that investors. operations (OMO) to support business model. Some are from “BBB” to “BB”. The focus liquidity. All of these steps put focused on corporate segment needs to be on ensuring together is likely to help match while others are predominantly adequate diversification. This demand and supply in the bond retail-oriented - both in terms of ensures that even under the market. Thus far, the yields had their assets as well as their event wherein liquidity of a discounted marginal spike in liabilities. The product segments particular instrument gets fiscal deficit, but a cut in these companies operate in vary adversely impacted, the overall corporate tax rates is likely to significantly. For example two-, scheme level liquidity does not lead to larger-thanexpected rise three and four-wheeler space, come under stress. While the in deficit. Therefore, the bond housing finance NSE -0.01 %, asset (investment) side of MFs market may remain rangebound. infrastructure finance, gold loans have been under scrutiny thanks etc. Instead of looking at NBFCs to recent events, what is impor- Investors have been worried as one homogeneous cohort, we tant is to maintain granularity in Interview Contd. from page 2 investors. What is the reason managed funds. However, owing small, midcaps, and in many of returns, asset allocation remains for such a low penetration? to lower expenses and near-term the value oriented sectors of the the key strategy. In debt, Going forward, would they be performance, there has been a economy. On the other hand, the investors can consider investing able to compete with their significant amount of interest near-term outlook of the quality in credit risk and moderate active counterparts? shown in passively managed sector stocks continues to duration debt funds. funds as well. r e m a i n p o s i t i v e ; h o w e v e r, Over long periods, active funds valuation-wise, these names have been able to generate alpha What will be your advice to look overvalued. A gradual shift for investors. As long as they retail investors now? from quality stocks to small, continue to outperform, actively midcaps, and value oriented managed fund will continue to In our view, equity market has stocks is recommended over the have an edge over passively reasonable valuation support in next few years. For long term

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. 4 TARAKKI TIMES, SEP-NOV 2019 Interview When the economy is in a bad shape, invest in cheap stocks to get good returns in the long run Mint | October 23, 2019 the economy is in bad shape and companies which require debt, period for long-term investors. you make money. which are decent and not junk, they are not able to get money in Give us some ideas to ruminate S Naren But, this time around, the only debt, and that has become a for Samvat 2076. Which are the ED & CIO difference I would say, is that problem. The borrowing cost for sectors or stocks or trends that ICICI Prudential Mutual Fund while the economy is in bad them have gone up because you are already betting on, or shape, many of the large caps or somewhere people want to lend will bet on shortly? Stock market expert S. Naren, mega-caps are not cheap at all. only to save companies or they Executive Director and Chief Normally when the economy is in are happy keeping the money Naren: Over the last 6 months I n v e s t m e n t O f f i c e r, I C I C I bad shape, you will see the entire idle in debt because that is the we have been saying that essen- Prudential Asset Management market being cheap, but this challenge, if you ask me. tially you bet on companies and Co. Ltd. shared his views on the time you can clearly see that the sectors which have delivered no current market outlook and what mega-caps are not cheap but the Therefore, there is need for returns for 12 years; power, the future holds. Edited Experts: rest of the markets is reasonably people to take risk in debt. telecom, some of the infra valued. The second is that there is a spaces and corporate banks. Since the late 90s, the RBI was phenomenal amount of money Increasingly if you look at from cutting rates and the How long the economy will take which is stuck in real estate, in 2017 top, even many of the benchmark prime lending rate to revive, that is a debate, which under-construction projects, as smallcaps rather than some (PLR) had come down from we don’t have an answer on. My well as projects where a lot of quality smallcaps have hardly 18% to 8% or thereabouts by belief is it should take longer real estate, even completed is delivered returns. 2002. You had a lot of money (than two quarters), but that stuck, and somehow people are being thrown in and the doesn’t mean this is not a time to not willing to drop the price there So, I believe that you have a wide Vajpayee government doing invest for the long-term. and sell off . variety of stocks and sectors great things such as the golden which have delivered no returns quadrilateral. However, it took Let’s try and identify what will That has become a problem for 12 years which are looking four-five years for us to bottom cause this shift in sentiment because, at the end of the day if appetisingly interesting because out. Are you getting a sense because we have been in a you have misallocated money, if you have not delivered returns that the recovery we are seeing period of extreme pessimism. that is a big challenge from for 12 years, no one enters a in the market presages a Some of the pessimism has an India point of view, and sector and therefore, incre- recovery in the economy in a gone away but will it turn into the biggest challenge the mental competition from new quarter or two? optimism and what is required government is dealing with is if entrants comes down to zero for that? We have seen what individuals or corporate mis- and many of the existing entrants Naren: It is much clearer for the government is doing, the allocate money, how do you also wind up and go away. long-term investors that you RBI is doing. But, in your solve it. That is a very com- invest when the economy is assessment, what will cause plicated debate which the So, I believe you can pick up down in cheap stocks and you that fundamental shift in government is going through at anything which has not done get very good returns in the long sentiment for people to be this point of time. well for 12 years. For the sectors, run. wanting to buy stocks, buy I think the next 5-10 years will be assets? The day the government is able very good. It is very interesting; We look at five indicators of the to solve that problem, I think we in 2007 quality like pharma and economy: One is credit growth, Naren: The problem is not in will be through. I would say you tech were very cheap and at that second is power demand, third is stock market, if you ask me. need the misallocation to slowly point of time, people used to say oil demand, fourth would be People are buying stocks. The come down in real estate, you that you cannot bet on quality; container traffic and fifth would problem is that today we have need people to take a little bit you have to bet on infra. Now we be auto numbers. And, all these AA companies and companies more risk in debt and you need are reversed; people say you bet are high frequency, good quality which we think are AA; they are some animal spirit among the on quality megacaps and do not numbers. All of them are telling raising money at high rates. I businessmen. The tax con- bother about anything else. you that the economy is in believe that the problem is that cession for new units, which was relatively bad shape. When the people are not willing to take risk recently announced is a very But when you have stocks economy is in great shape, you in debt, and in my opinion, that is good step. I believe we also need trading at 70-80 PE and market- will be able to make money or the whole problem rather than a much weaker rupee so that cap which is running into billions you invest in value stocks when the problem in equity markets exports are incentivised. of dollars, I believe that there is very little value whereas there is What is happening is all the With these steps we will be a huge value in all the sectors through with the problem and I which have done badly for 12 Although the economy is in a bad shape, believe that overnight these years. So that’s how we are mega- and large-caps are not cheap at all. problems are not going to get looking at it and there is a wide The rest of the market is fairly valued. resolved. Time will be the number of stocks. biggest healer and slowly the economy will recover. We are When the private sector and clearly towards the bottom and individual corporate makes therefore, it’s an interesting mistakes of capital allocation, Contd. on page 5

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, SEP-NOV 2019 It’s important that investors continue SIPs for 3-5 years The Economic Times | October 25, 2019 Power and pharma are the top only old entrepreneurs exiting delivered ROE much below the S Naren sectoral preferences that also those businesses and those are cost of debt. I believe this is a ED & CIO meet valuation requirements the places where there will have one-time problem and Indian ICICI Prudential Mutual Fund said S Naren, chief investment to be a new trend because one of entrepreneurs are smart and officer, ICICI Prudential AMC. the lessons of investing is if there they will find a way out. We are in look at 12-year zero returns. In Edited excerpts from an are too many entrepreneurs a lower inflation environment these12 years, demand must interview with ET Now: exiting a business, the residual and that means you have to have gone up at least 70-80%. entrepreneurs make money. That prepare yourself for lower There are fewer power com- The tag line this year on ETNow is the kind of situation we are in nominal rates. If you had 10% panies today which are active is Naya Saal, Nayi Shuruaat at this point of time. inflation, maybe 15% is an easy compared to 12 years back. It is (new year, new beginning). return but if you do not have10% one of the sectors with a huge What is the Nayi Shuruaat for What do you make of the entire inflation,15% is not so easy and number of cheap stocks and it is investors this year? promoter pledge issue? that is the challenge and not something which is going to investors have to realise this. be obsolete in a hurry. You can have a ‘Nayi Shuruaat’ if Sometimes there are unintended you invest for the long term in consequences. Post 2013, we What will be your message for Pharma is another very intere- cheap stocks. That way, very had much lower inflation. People the retail investor? sting sector though for four rarely you make losses. And that forgot that inflation has gone years, returns have been is clearly the situation because down structurally in most parts I have been amazed and very pathetic. They have had issues what now appears as a set of of the world and after 2013, in happy with the way investors which no one could have even costly stocks is not just the result India as well. Now, the returns have behaved. SIPs have factored in four years back. A of one-year performance; it is that you can get on projects is continued and it is very important huge number of FDA problems actually 12-year performance. If also dependent on inflation. that people continue with their have shown up in the industry. you compare 2007 Diwali with People thought they were in SIPs in the next three to five We continue to be the drug 2019, you will find that there are a 2002 to 2007 world where if you years. Many of the small-caps makers of the world and Indian set of stocks which have done borrow at say 10%, you can get and mid-caps and most of the entrepreneurs will improve their badly for12 years and in many of ROE of 14-15% easily. But that is large-caps are attractively valued quality standards. those sectors, no new entre- not the trend and in fact, in 12 at this point of time and there is a preneurs are coming. There are years, many sectors have case to increase the quantum of SIPs. If you had10% inflation, maybe 15% is an easy return but if you do not have10% What is your idea for this inflation,15% is not so easy Diwali? Power and pharmaceuticals are two very interesting sectors at this point of time, clearly if you When the economy is in a bad shape, invest in cheap stocks to get good Contd. from page 4 returns in the long run how do the governments come quickly, along with the real estate in IT services there is potential in cation against dollar because the in for the great good? I mean deleveraging which needs to healthcare services. inflation differential is still there. you alluded to that problem. happen in Central Mumbai and I believe that we have to identify Without the rupee becoming What should the government Delhi and Noida and Gurugram. 3-4 areas. Manish very well cheaper it is very difficult to push do in that regard - fix a sector or spoke about areas like textile, exports and export have to two? If these two happen, that itself leather and aquaculture all the improve in India and that has pushes the economy from areas where there is some always been the way most of the Naren: I think you have to whatever growth we have now amount of employment possi- corporates have done. I am not deleverage the economy. You by 1-1.5%. After that we have to bility along with exports. I think saying it can be done like China can’t have, say, in central decide which are the areas those are all superb areas as but at least we need to have a Mumbai $1-5 million flats half where we need to take leader- well, besides agriculture. better export sector than we constructed or fully constructed ship like the government seems have today. without occupants. I believe that to be taking some steps in We have come to a conclusion something has to be done to electric vehicles for example, I that India cannot manage resolve capital allocation mis- think there is massive oppor- without some amount of rupee takes. Bankruptcy code was a tunity in healthcare services at depreciation. Rupee touch superb step in that regard and this point of time given that the 68/USD in 2013 and it hovers at we would want to see more world is becoming much older 71-72/USD six years later, While closures of all the old problems and requires healthcare services Manish correctly pointed out, through the bankruptcy code at a cheap cost. Like what we did there is need for rupee depre-

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. 6 TARAKKI TIMES, SEP-NOV 2019 Interview Global recession is not one of the major points of concern currently Mutual Fund Insight | November 2019 investment potential for the long higher than a debt fund. term in contrarian and value- oriented funds. A balanced-advantage fund is suitable for those investors who S Naren Among the basket of your wish to participate in equity ED & CIO funds, ICICI Prudential markets with a relatively conser- ICICI Prudential Mutual Fund Balanced Advantage has the vative approach. Both balanced highest AUM of around `27,500 and balanced-advantage cate- As a contrarian investor, do you crore. How is this fund different gory of funds can be considered see opportunity in the current from the other equity and debt by first-time equity investors. pessimism about the funds that you manage? What economy? What is your type of investors should invest What’s your view on the understanding of the current in it? shrinking alpha in active funds state of the market? When is a versus the TRI benchmarks? recovery likely? In case of our aggressive hybrid Have you taken any steps to fund, ICICI Prudential Equity & address it? The current situation in the Indian Debt Fund (erstwhile Balanced economy presents an interesting Fund), the net equity exposure is Polarisation of the market is one opportunity to invest for the long 65 to 80 per cent. However, for of the key factors responsible for term in the multi-cap, mid-cap, ICICI Prudential Balanced a shrinking or negative alpha in small-cap, value and credit-risk Advantage Fund, the net equity active funds. However, we categories of fund, which are exposure can vary from 30 to 80 believe that this is not a per- currently available at attractive per cent based on an in-house manent phenomenon, as was valuations. A recovery can be asset-allocation model. Both of seen during 1999 and 2007. expected once the deleveraging these funds have a multi-cap Once this polarisation decreases cycle is complete and interest approach and attract equity and value, contrarian, small-cap rates, land prices come off from taxation. Since at least 65 per and mid-cap strategies deliver the current levels. cent of the portfolio is invested in good relative returns, we believe equities at all times in an aggre- that alpha created by active The last decade has seen ssive hybrid fund, such a fund funds is likely to return. outperformance by quality/ tends to be more aggressive as growth stocks. Is a shift compared to the balanced What’s your view on global towards value around the advantage category. recession fears and how are corner? they likely to impact Indian In ICICI Prudential Balanced markets? We are of the view that quality Advantage Fund, the presence of and growth stocks are implying equity ensures that the up move Global recession is not one of the the underlying growth story in is captured to the extent of major points of concern currently them, while value and contrarian equity presence, while debt as equity markets are relatively stocks are implying negative ensures that the portfolio has the cheaper when compared to debt growth seen in companies much required cushion effect in markets in many parts of the across sectors. In the light of times of a market correction. world. this, there may be a sizeable This enables positive investment experience across a market What would be your advice to cycle. In effect, ICICI Prudential the equity investors who are Balanced Advantage Fund has a getting unnerved because of lower risk than an equity fund but the current market situation? Within equity, if an investor is ready As investors, the optimal to stay invested for over five years, approach currently would be to he can consider investing in adhere to the asset-allocation mid/smallcap, multi-cap and value discipline. It is important to stay funds in a systematic manner…. In invested not only in equity but debt, we are positive on the credit- also in debt. Within equity, if an risk category of funds. investor is ready to stay invested for over five years, he can consider investing in mid/small- cap, multi-cap and value funds in a systematic manner. This is because of the relative attractive valuations prevailing in these pockets. In debt, we are positive on the credit-risk category of funds.

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. Tarakki Corner 7TARAKKI TIMES, SEP-NOV 2019 Your YTouar TraarakkkikCoirnCer orner TARAKKI SUCCESS STORY Ashwin Vajani Ashwin Vajani Advisory, Mumbai Asset Allocation for Long Term Wealth Creation Venturing into financial advisory in 1990, Ashwin Vajani has spent more than half of his life advising his clients for a prosperous financial future. He entered in this space at the age of 18 years, as setting up an advisory firm called for zero or insignificant capital to start with. With control over his expenses and staying financially responsible, Ashwin has been profitable in his advisory from the very first month of his professional career. Ashwin started with an agency for public sector mutual funds in 1990, and since then, he has been advising his clients to invest in mutual funds only. While it might seem a single investment product, a wide range of schemes available to invest in making it more relevant as an investment product, suiting different financial goals and risk profiles. \"I was fortunate to conceive my business during the beginning of a bull run period in early 90s. It was the time when the markets were rising consistently, and everyone wanted to invest in stock markets.\" Ashwin recalled his earlier days. Such euphoric atmosphere for investing in equity markets helped him gain easy business. During those times, even the mutual funds were allowed to offer guaranteed returns, and thus, could be seen as a proxy to the fixed deposits. Ashwin added, \"Few of the schemes then could offer 15%+ assured returns, with firm allotment. The investment experience of clients got pleasant when such schemes could generate a 20 to 30% return in two to three months.\" However, just like every market cycle, the bull run was followed by the lengthy correction cycle. Post the market scam got unearthed in 1992, the markets remained range-bound for the next 5-6 years. This was the time Ashwin focused on building debt portfolios for his clients. Govt. policies were another breather for Ashwin, as indexation benefit was announced for debt mutual funds. While the mutual funds were not as popular an investment product during the late 1990s, Ashwin's strategy to focus on debt funds reaped excellent benefits for him. \"While everyone focused on building equity portfolio for their clients due to potential of higher returns, I focused on debt funds during the times of correction. As the expectations of debt investors tend to be moderate, they reflect more patience and continue to stay invested for longer term.\" Ashwin quipped while sharing his experiences. A pleasant investment experience encourages his clients to share their references with Ashwin. Man is a learner every single day, and Ashwin is no exception. He sincerely accepts some of the investing mistakes he and his clients made during the early stages of his career, just like the early- stage investments in one of the marquee mutual fund schemes during the NFO in the year 1995. While he could collect around ` 2 crores as NFO application for that fund, all of his clients and he too redeemed within the first 4-5 years of the investment. Ashwin shares, \"Me and my clients redeemed even when there was no genuine need of the funds, and we missed the rally by miles. Had we stayed invested till today, the initial investment of` 2 crores in 1995 would have been around ` 216 crores by Oct. 2019. This is precisely the power of equities over long term.\" Advocating asset allocation as the vital ingredient for long term wealth creation, he advises his clients to stay invested across asset classes and encourages them to stay invested across the market cycles. Such investments over the long term increase the probability of positive experiences for the clients, and as it is always said, word-of-mouth publicity is the best publicity one can get. Happy Investing! ARN - 2224

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. 8 TARAKKI TIMES, SEP-NOV 2019 Tarakki Corner Your YTouar TraarakkkikCoirnCer orner TARAKKI SUCCESS STORY Paresh A. Shah Shah Wealth Creators, Mumbai Driving the Road from being a Common Man to a High Net-worth Individual (HNI) Paresh A. Shah was living a happy life while he was working with a printing press in Mumbai, and had his wonderful plans for life. However, destiny does play a role in shaping one's future. His life turned upside down with a train accident while he was on his way to office once. Since his health did not allow him to travel, he had to quit his job. Consequently, he witnessed some hard times financially, as he was at home with no income for more than a year. This was the time when he realized the importance of having a cushion of financial savings for meeting the contingencies and achieving different financial goals. As he did not want anybody else to experience such hard times, he decided to step into the world of financial advisory and steer individuals towards insurance, fixed deposits, PPF, and other post office products and gradually Mutual funds. His initial clients were his acquaintances, colleagues, friends, family members, etc. At the same time, he also interacted with chaiwallahs, shoeshine boys on railway platforms, panwalas, auto-rickshaw drivers, watchmen, hawaldars, waiters, etc. with the intention of encouraging them to start saving steadily. His network of clients steadily grew with business people, professionals, entrepreneurs, etc. Paresh recalls, \"While Mutual funds have steadily been emerging as preferred investment product due to widespread promotional campaigns, things were not like that always. Initially, it used to be difficult to convince my clients to invest in Mutual funds.\" He understood the pulse of financial markets and that of his clients, which helped Paresh to establish a sense of trust with his clients, helping him lay a strong foundation for long-lasting relationships. Paresh now offers a broader spectrum of advisory services, including Financial planning, Insurance planning, Tax planning, Wealth planning, Retirement planning, Estate planning etc. and presently manages advisory portfolio of more than Rs. 225 crores for his clients. Paresh further shares, \"I want to be known as Manufacturer of HNIs, helping them create long term wealth.\" As a Financial Advisor of masses, he has learned to be patient with his clients and talks in the language which his client understands. While the world of financial planning can stay crowded with technical and financial jargon, he tries to simplify the conversations to the extent possible. He generally relates making lumpsum investments as similar to investing in bank FD, Systematic Investment Plan (SIP) as Recurring Deposits (RDs), and Equity Linked Savings Schemes (ELSS) as similar to PPF, etc. Having learned the financial lessons first hand, he describes patience as a blessing in the financial plans. He further adds, \"whether you are in business or profession, your success will generally be U-shaped and not V-shaped. One will have to go through many market cycles to be on top. Always remember that Rome was not built in a day.\" Just like the way drugs are tested in human clinical trials, Paresh also claims to invest in every scheme that he recommends to his clients. He adds, \"For the last 25 years, I have maintained this discipline of investing in schemes himself first and evaluating them for 6 to 12 months. Only once I am convinced about a particular scheme, I recommend these schemes to my clients.\" Trusting the potential of long term wealth creation through equity markets, he prefers to sell equity schemes to his clients with long term investment horizon. Helping his clients to steer through the volatile times, he advises them to continue to stay invested, instead of redeeming the investments and further continue to make additional investments in the markets for long term wealth creation. ARN - 0478

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 Review 9TARAKKI TIMES, SEP-NOV 2019 ICICI Prudential Regular Savings Fund For investors with a penchant for risk Hindu BusinessLine | October 05, 2019 ICICI Pru Regular Savings is one of portfolio is in small- and mid-cap the top-performing funds from the stocks that spices up the scheme’s conservative hybrid funds returns. On the debt side, the fund category, delivering category-beating bets on higher accrual income while returns across time-frames. It invests taking moderate duration calls. Large 10-25 per cent of assets in equities allocation to relatively lower-rated and the rest in debt instruments. bonds pegs up credit risk. Hence the fund is suitable for investors with a Post re-categorisation, the fund medium-to-high risk profile who are aware of the credit risk associated Manish Banthia maintained its equity allocation at 11- with mutual funds. Debt - Fund Manager 17 per cent. One-third of the equity ICICI Prudential Mutual Fund Source: NAVIndia, ACE MF and factsheets *Systematic Withdrawal Plan (SWP) returns are calculated with an initial investment amount of 60,000 and a monthly pay-out of `1,000. All are growth options. ***NCD of JIndal Steel & Power (of which the fund held around 3% exposure) was downgraded to 'D' in March 2016 and then upgraded to investment grade of 'BBB-' in April 2018

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, SEP-NOV 2019 Fund Review ICICI Prudential Value Discovery Fund A marathoner, not a sprinter Hindu BusinessLine | November 09, 2019 The fund has returned nearly 14% over 7- and 10-year periods; short term returns are dismal Value investing is all about going slowly exited its positions in many mid- and exited in 2017, has outperformed against the grain while deploying small-cap stocks. Its portfolio now consists significantly and become a large-cap stock. money in the stock market. It is about largely of large-cap stocks such as Mahindra finding value in stocks which others have & Mahindra, Vedanta, Hindalco Industries Now, he sees value in pharmaceuticals, dismissed, and in businesses which are and many non-financial PSU stocks such as utilities and non-financial PSU stocks along undervalued but are a good long-term bet. NHPC, NTPC, Power Grid and Bharat with some IT companies including TCS, ICICI Prudential Value Discovery Fund is one Electronics. Infosys and HCL Technologies, as can be fund that tries to execute this strategy. The seen from the fund’s monthly portfolio scheme has underperformed its peers and Fund Performance disclosures. its benchmark over the past three-year time- frame. The fund manager, however, has Ever since the fund became large-cap heavy, Should you invest? shown that he has an instinct to pick good it has been underperforming its peers. In the stocks. last three years, it has not beaten its The returns in the last three years are benchmark (BSE 500 TRI). It has delivered nothing to write home about. The fund’s The fund is agnostic to market capitalisation 5.1 per cent CAGR against its benchmark’s underperformance vis-à-vis its peers and the and this approach allows it to hunt for value 11.6 per cent. Over the past year, the fund’s benchmark index is a direct consequence of in stocks that are out of favour. Prior to 2017, returns have drifted in the negative territory its preference for large-cap stocks, of late, ICICI Prudential Value Discovery Fund while its peers such as JM Value, Nippon with nearly 68 per cent of its corpus being predominantly invested in mid- and small- India Value, UTI Value Opportunities and Tata deployed in large-cap stocks as of cap stocks. Equity PE have given returns of 10.6 per September, according to data from NAV cent, 9.7 per cent, 8.4 per cent and 9.5 per India. Around the same time, there was froth in the cent, respectively. mid- and small-cap space and the scheme The fund manager has displayed his ability The scheme has outperformed its peers in to deliver good returns with his value picks. the seven and 10-year periods with a CAGR He exited mid- and small-cap stocks before of nearly 14.8 per cent and 14.7 per cent, the carnage that saw investors lose heavily respectively, against the category average of from 2018 onwards. 13.5 and 11.5 per cent over the same period. The fund has a four-star rating according to The fund manager has also deployed over BusinessLine Portfolio’s Star Track Mutual one-third of its corpus (of more than Fund Ratings. ₹15,000 crore) in high dividend yield stocks, which include PSUs. The fund’s manager, Mrinal Singh, has avoided non-banking finance companies Value investing needs to be given time to (except LIC Housing Finance) because of the bear fruit and this fund could give investors larger malaise plaguing the sector over the decent return if its bets pay off. past 18 months or so. However, one of his previous NBFC bets - Bajaj Finserv - which he

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 Review 11TARAKKI TIMES, SEP-NOV 2019 All-weather MFs Hindu BusinessLine | November 11, 2019 An in-depth analysis of hybrid mutual funds that juggle various asset classes to give you good risk-adjusted returns ‘Don’t put all your eggs in one basket’ — the treated as equity funds for tax purposes. non-equity funds for tax purpose. adage also rings true for diversifying your Aggressive hybrid, balanced advantage, investments across different asset classes. multi-asset allocation (barring a few Aggressive hybrid funds Allocation to different asset classes helps schemes), equity savings and arbitrage investors achieve positive returns over any funds fall in this basket. For equity funds, a There are 33 schemes under the category, given period. This is because the holding period of 12 months or more is allocating 65-80 per cent of their total assets underperformance in one asset class can be regarded as long-term, wherein long-term to equities, while the rest is invested in debt mitigated by the outperformance in others. capital gains (LTCG) in excess of ₹1 lakh is and money market instruments. taxable at the rate of 10 per cent. If the units Hybrid funds, with a broad range of asset are redeemed before 12 months, there is a Investment strategy: These funds follow a allocation strategies, are a good means to 15 per cent tax on short-term capital gains disciplined approach of allocating between diversify your portfolio and reduce risk. (STCG) on equity funds. equity and debt. This helps them capitalise There are variations within the hybrid fund on opportunities in equity market while category — aggressive hybrid, balanced In the case of non-equity funds, a holding giving stability to the portfolio through debt advantage or dynamic asset allocation, period of 36 months or more is regarded as investment. multi-asset allocation, equity savings, long-term, wherein the LTCG tax is levied at conservative hybrid and arbitrage. These 20 per cent with indexation benefit on the The schemes under this category funds invest across equity, debt, arbitrage gain. A holding period of less than 36 depreciate less during market corrections opportunities and also gold. months is defined as short-term, and STCG and appreciate less during rallies in tax is charged as per the investor’s tax slab. comparison to other equity-oriented Each hybrid category follows a different Conservative hybrid funds are considered as categories. Lower volatility results in asset allocation pattern as prescribed by the market regulator. In the equity portion of the portfolio, these funds hold a blend of large-, mid- and small-cap stocks. In debt portfolio, the funds invest in call money, tri-party repos (TREPs), commercial papers (CPs), certificates of deposit (CDs), Treasury Bills (T-Bills), corporate non- convertible debentures (NCDs), PSU bonds and government securities (G-Secs). Understand the risk Hybrid funds are susceptible to the risks associated with equity and fixed-income securities. Since most hybrid funds hold a portfolio heavy on fixed-income instruments, one should understand the risk associated with investments in bonds, especially credit risk. Over the past 15-18 months, a spate of corporate bond downgrades and defaults has impacted the performance of hybrid funds, too. Bonds issued by IL&FS, DHFL, Essel Group, Altico Capital and Reliance ADAG were all downgraded sharply. This led to mutual fund companies marking down such distressed assets in the portfolio of the schemes that held them. This resulted in significant drops in their NAV. Some debt funds registered around 50 per cent negative returns in a single day. Of the 129 open-ended hybrid schemes, 37 were hit by such downgrades and defaults of the bonds they held. Taxation Hybrid funds that allocate at least 65 per cent of their corpus to domestic equity are

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. 12 TARAKKI TIMES, SEP-NOV 2019 Fund Review delivering superior risk-adjusted returns depend on how they fare during various Balanced advantage or Dynamic asset than equity-oriented categories over the cycles of equity and debt markets. Five-year allocation funds long term. rolling returns data calculated from the past seven years’ NAV history show that the top- Currently, 21 funds are under this category, Portfolio: During market rallies, many 10 performing funds under this category dynamically allocating between equity and schemes under this category increase their have delivered 15 per cent CAGR, which was debt based on equity-market conditions. allocations to equity to more than 80 per higher than that of the Nifty 50 TRI (12.7 per Though this category was introduced post cent which helps them deliver higher returns cent). the recategorisation of mutual funds in mid- similar to that of equity-oriented schemes. 2018, seven funds, including ICICI Prudential Suitability: These funds are suitable for Balanced Advantage and Aditya Birla Sun In the equity portion, most of the schemes investors with a medium risk profile who Life Balanced Advantage, have been follow a multi-cap approach, though there is want allocation into equity as well as debt in following this strategy for more than six a tilt towards large-cap stocks. The schemes their portfolio. Investors who are new to years. try to capitalise from both accrual and equity market and want to taste equity risk duration opportunities by investing in can also consider investing in these funds. Investment strategy: These funds increase money market instruments, PSU and The ideal holding period is five years and their allocation to equities when the equity corporate bonds and G-Secs. NAVs of 14 out more. markets look under-priced, and vice-versa. of the 33 schemes under the category were Each fund follows an in-house valuation hit by the bond-rating downgrades and Funds to consider: ICICI Prudential Equity & model to determine their equity allocation. defaults in the recent bonds fiasco. Debt, SBI Equity Hybrid and L&T Hybrid These valuation metrics use various Equity Fund quantitative criteria such as price-to- Performance: Performance of these funds earnings (P/E), price-to-book (P/B) or dividend yields. Portfolio: The equity portion of the portfolio is always maintained at above 65 per cent (barring UTI ULIP); hence, they are treated as equity funds for tax purposes. Most of these funds follow a hedging strategy by taking equity derivative positions when the equity market valuation appears high. This helps limit the downside while maintaining the equity allocation at above 65 per cent. The allocation to equity shares (unhedged) is 30-80 per cent in most funds. The debt portion is managed with a blend of accrual strategy and duration play. Performance: In the risk-return pyramid, the balanced advantage category is placed between aggressive hybrid and equity savings funds. One cannot compare balanced advantage funds with aggressive hybrid funds as the latter allocates 65-80 per cent to equity (unhedged). Hence, the participation of balanced advantage funds in equity rallies is limited. Performance, as measured by five-year rolling returns, shows that the top-five performing funds under this category have delivered 12.5 per cent CAGR over the past seven-year period, which was almost similar to that of the Nifty 50 TRI (12.7 per cent). Suitability: Investors who wish to participate in equity markets with a relatively conservative approach can invest in this category. The ideal holding period is five years and more. Funds to consider: ICICI Prudential Balanced Advantage, Invesco India Dynamic Equity and Aditya Birla SL Balanced Advantage. Multi-asset allocation funds There are seven funds under this newly introduced category that are mandated to invest at least 10 per cent each in three asset classes - equity, debt and gold.

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 Review 13TARAKKI TIMES, SEP-NOV 2019 Investment strategy: This asset allocation corpus is invested in hedged and unhedged Suitability: Given the higher allocation to strategy aims to reduce the volatility of the equity. Hence, they are treated as equity debt which is actively managed, these funds returns by investing in asset classes that are funds for tax purposes. are suitable for all types of investors with negatively correlated. Apart from equity and varying risk profiles. For instance, investors debt, the investment in gold offers a hedge Portfolio: These schemes try to capitalise with a high risk appetite can consider against market uncertainties and inflation. on arbitrage strategy by allocating 25-75 per allocating a part of their investment if they cent to arbitrage trades based on the market want to diversify into debt assets instead of Portfolio: Currently, five schemes - Axis condition. As per the latest portfolio investing directly in debt securities or debt Triple Advantage, Essel 3 in 1, HDFC Multi- (September 2019), the top-performing schemes. The ideal holding period would be Asset, ICICI Prudential Multi-Asset and UTI schemes maintained 30-40 per cent in five years or more. Multi Asset - allocate more than 65 per cent unhedged equity. In the debt portfolio, the of their corpus to equity and are hence funds invest in a mix of AAA, AA and A rated Funds to consider: ICICI Prudential Regular eligible for taxation similar to that of equity corporate debt and G-Secs. Four funds were Savings, Aditya Birla Sun Life Regular funds. impacted by the bond downgrades and Savings and SBI Debt Hybrid. defaults. All the funds in the category have an Arbitrage funds exposure of 10-30 per cent to gold through Performance: In the risk-return pyramid, the gold exchange-traded funds (ETFs) or direct category is placed between balanced Currently 24 funds are under this category, investment or both. Funds that currently advantage and conservative hybrid funds. aiming to capitalise on the arbitrage have higher exposure to gold are Quant Performance, as measured by three-year opportunities available in the cash and Multi Asset (31 per cent), HDFC Multi-Asset rolling returns, shows that the top-five derivative segments. (16 per cent) and SBI Multi Asset Allocation performing funds under this category have (16 per cent). delivered 8.7 per cent CAGR over the past Investment strategy: These funds five-year period. generate returns through the arbitrage Performance: All the funds in this category opportunities arising out of pricing have a short NAV history of little more than a Suitability: Equity savings funds are mismatch in a security between different year post the change in attributes. Over the suitable for investors looking for some markets or as a result of special situations. past year, Axis Triple Advantage has exposure to equity but have a lower risk The risk in these funds is therefore relatively outperformed others with a huge margin, by appetite. The ideal holding period would be low, similar to liquid funds. These schemes delivering a CAGR of 22 per cent, thanks to 3-5 years. also invest in short-term debt and money its prudent equity stock picking. All the market securities. schemes benefited from the recent rally Funds to consider: HDFC Equity Savings, seen in the price of gold. Kotak Equity Savings and Edelweiss Equity Arbitrage funds have been gaining the Savings attention of investors of late due to the Suitability: Investors with a medium risk recent instances of credit downgrades and profile wishing to invest across multiple Conservative hybrid funds defaults impacting the sentiment towards asset classes can consider investing in some debt mutual funds, including liquid these schemes with an investment horizon There are 21 funds under this category, funds. Also, arbitrage funds are treated as of five years or above. However, considering allocating 10-25 per cent to equity and the equity funds for taxation purposes. their short NAV history, one can wait till the rest to debt instruments. Earlier, they were funds prove their mettle. categorised as monthly income plans Performance: The returns generated by (MIPs). arbitrage funds depend on the volatility in Funds to consider: Axis Triple Advantage, the equity market and the prevailing short- ICICI Prudential Multi-Asset and UTI Multi Investment strategy: Conservative hybrid term rates in the money market. When there Asset Fund. funds invest as high as 90 per cent in debt is a bullish sentiment and an upward- instruments and the rest in equity. The trending equity market, arbitrage funds Equity savings funds higher allocation to debt helps in steady typically give good returns. The spread growth of principal with minimal risk. The (difference between the price in the cash The 23 funds under this category currently equity component, on the other hand, helps and the futures market) is determined by the allocate at least 65 per cent of their corpus to boost returns. interest-rate levels in the system and the hedged and unhedged equities, and the rest level of activity in the cash and futures to debt assets. These funds were either Portfolio: On the fixed-income side, all the market. If the interest rates are low, arbitrage launched in the past six years or converted funds have invested in a mix of government spreads also will be low, and vice-versa. One from existing schemes. securities, corporate bonds and short-term fund was impacted by the bond default. debt papers. They actively manage their Investment strategy: Equity saving funds debt portfolio based on the underlying One-year rolling return data calculated from invest in equities, debt and arbitrage interest-rate view. However, considering the the last five years’ NAV history show that the opportunities. While equity provides a kicker current uncertain interest-rate scenario, top-10 performing funds under this category to returns, debt offers stable returns with many funds now follow the accrual strategy. have delivered 7 per cent CAGR. low volatility. The arbitrage strategy is used Twelve out of the 21 funds in the category to take advantage of the price differentials in were hit by the rating downgrades and Suitability: It is tax-efficiency that makes various market segments such as cash and defaults of the bonds they held. The equity arbitrage funds a superior option to liquid futures market. Actively using derivatives portion is managed with a multi-cap and other short-term debt funds. Arbitrage helps the funds to not only reduce the approach with a blend of large- and mid-cap funds are well-suited for investors in the 20 volatility of returns but also earn some extra stocks. per cent or 30 per cent tax bracket looking returns. for a safe 6-12-month parking ground. Performance: Performance, as measured In equity savings funds, there is a good by five-year rolling returns, shows that the Funds to consider: Nippon India Arbitrage, chunk of unhedged equity that can help top-five performing funds under this IDFC Arbitrage and Kotak Equity Arbitrage boost returns. As the equity and the category have delivered 10.5 per cent CAGR Fund. derivative exposure is considered as ‘equity’ over the past seven-year period. This is allocation, these funds fit the criterion of an higher than the rates of 5-7.5 per cent equity fund, since at least 65 per cent of their offered by bank fixed deposits.

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. TARAKKI TIMES, SEP-NOV 2019 Fund Review mint List of ICICI Prudential Funds in Mint 50BEST FUNDS Mint | November 2019 FUND CORE 3-year return (%) 5-year return (%) 10-year return (%) Corpus (Rs cr) EQUITY-LARGE CAP ICICI Prudential Bluechip Fund 9.42 9.46 12.25 23,019 AGGRESSIVE HYBRID ICICI Prudential Equity & Debt Fund 7.32 9.53 13.00 23,487 CONSERVATIVE HYBRID 7.79 9.44 9.53 1,650 ICICI Prudential Regular Savings Fund INTERNATIONAL 7.09 8.53 NA 87 ICICI Prudential Global Stable Equity Fund 15.34 12.15 NA 324 ICICI Prudential US Bluechip Equity Fund 1-year return (%) 3-year return (%) 5-year return (%) Corpus (Rs cr) FUND CORE DEBT-ORIENTED 10.09 7.36 8.25 9,146 CORPORATE BOND ICICI Prudential Corporate Bond Fund SIP Top Up A monthly Systematic Investment Plan (SIP) of Rs.10,000 with an annual Top Up of 10% in these schemes has generated returns as stated below. Scheme Name 5 Years 10 Years ICICI Prudential Total Amount Invested (`) 7,32,612 19,12,491 Midcap Fund Return (%) 8,36,802 34,53,894 Return (%) ICICI Prudential 5.68 13.18 Bluechip Fund 9,15,638 33,10,973 9.55 12.28 ICICI Prudential Equity Return (%) 8,99,966 33,99,069 & Debt Fund Return (%) 8.81 12.84 ICICI Prudential 8,63,312 30,55,376 Large & Mid Cap Fund 7.02 10.54 ICICI Prudential Return (%) 8,93,832 32,09,121 Multi Asset Fund Return (%) 9.99 11.60 ICICI Prudential 8,90,412 33,08,178 Multicap Fund 8.35 12.26 ICICI Prudential Balanced Return (%) 9,10,306 32,31,666 Advantage Fund Return (%) 9.30 11.75 Return (%) ICICI Prudential Return (%) 8,26,467 28,28,718 Focused Equity Fund 5.15 8.86 ICICI Prudential 8,07,629 32,95,484 Value Discovery Fund 4.16 12.17 ICICI Prudential Long Term 8,88,515 33,29,162 Equity Fund (Tax Saving) 8.26 12.39 Data in XIRR (%) terms and as of October 31, 2019 Past performance may or may not sustain in the future.

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 Review 15TARAKKI TIMES, SEP-NOV 2019 ETW Funds 100 List of ICICI Prudential Funds in the Economic Times Wealth ET Wealth | November 2019 FUND Value Research Returns (%) Fund Rating EQUITY: LARGE CAP ICICI Prudential Bluechip Fund 3-month 6-month 1-year 3-year 5-year EQUITY: MULTI-CAP 9.37 ICICI Prudential Multicap Fund 2.6 1.55 11.33 9.44 9.45 HYBRID: EQUITY SAVINGS ICICI Prudential Equity Savings Fund -0.47 -2.44 6.96 6 - HYBRID: AGGRESIVE 9.53 ICICI Prudential Equity & Debt Fund 2 3.7 10.02 6.95 9.51 HYBRID: CONSERVATIVE -0.61 -0.69 8.43 7.44 8.51 ICICI Prudential Regular Savings Fund 9.46 DEBT: MEDIUM- TO LONG-TERM 2.36 4.1 10.73 7.93 8.27 ICICI Prudential Bond Fund DEBT: DYNAMIC BOND 2.32 6.51 11.84 6.72 ICICI Prudential All Seasons Bond Fund DEBT: CORPORATE BOND 1.34 5.6 10.47 7.29 ICICI Prudential Corporate Bond Fund 2.26 5.28 10.25 7.46 Systematic Investment Plans A monthly Systematic Investment Plan (SIP) of Rs. 10,000 in these schemes has generated returns as stated below Scheme Name 3 Years 5 Years 7 Years 10 Years 3,60,000 6,00,000 8,40,000 12,00,000 ICICI Prudential Midcap Fund Total Amount Invested (`) 3,70,846 6,97,422 13,33,701 24,39,599 Return (%) (An open ended equity scheme predominantly 1.94 5.96 12.98 13.59 investing in midcap stocks) 4,07,129 7,64,402 12,84,710 22,97,121 ICICI Prudential Bluechip Fund Return (%) 8.16 9.62 11.93 12.47 3,97,851 7,51,510 12,88,916 23,83,911 (An open ended equity scheme predominantly investing in large cap stocks) 6.60 8.94 12.02 13.16 3,85,713 7,18,864 11,92,599 21,06,982 ICICI Prudential Equity & Debt Fund Return (%) Return (%) 4.53 7.16 9.85 10.85 (An open ended hybrid scheme investing predominantly Return (%) 3,95,690 7,46,080 12,52,351 22,21,292 in equity and equity related instruments) Return (%) 6.24 8.65 11.22 11.84 ICICI Prudential Large & 3,95,072 7,43,356 12,92,858 22,98,811 Mid Cap Fund 6.13 8.50 12.11 12.48 (An open ended equity scheme investing in both 4,11,931 7,57,977 12,43,377 22,35,902 large cap and mid cap stocks) 8.95 9.29 11.02 11.96 ICICI Prudential Multi Asset Fund 3,76,252 6,86,487 11,24,657 19,30,640 (An open ended scheme investing in Equity, Debt, Gold/Gold ETF/units of REITs & InvITs and other 2.89 5.33 8.20 9.19 asset classes as may be permitted from time to time 3,69,644 6,70,193 12,23,552 23,38,589 ) ICICI Prudential Multicap Fund 1.73 4.37 10.57 12.80 (An open ended equity scheme investing across 4,01,168 7,39,882 12,81,952 23,21,747 large cap, mid cap and small cap stocks) 7.16 8.32 11.87 12.67 ICICI Prudential Balanced Return (%) Advantage Fund (An open ended dynamic asset allocation fund) ICICI Prudential Return (%) Focused Equity Fund Return (%) Return (%) (An open ended equity scheme investing in maximum 30 stocks across market-capitalisation i.e. focus on multicap) ICICI Prudential Value Discovery Fund (An open ended equity scheme following a value investment strategy) ICICI Prudential Long Term Equity Fund (Tax Saving) (An open ended equity linked saving scheme with a statutory lock in of 3 years and tax benefit) Data in XIRR (%) terms and as of October 31, 2019 Past performance may or may not sustain in the future.

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. 16 TARAKKI TIMES, SEP-NOV 2019 Fund Review List of ICICI Prudential Funds in Star Track Mutual Fund HBL | November 2019 Scheme Name BL Rating Trailling Returns (%) YTD Absolute 1 Year CAGR 3 Year CAGR 5 Year CAGR -1.7 8.0 ICICI Prudential Bluechip Fund -4.6 -6.4 7.1 5.6 ICICI Prudential Large & Mid Cap Fund -4.4 8.4 ICICI Prudential Multicap Fund -9.7 -8.1 3.9 7.5 ICICI Prudential Midcap Fund -0.8 4.8 ICICI Prudential Smallcap Fund -3.4 -9.9 4.7 4.8 ICICI Prudential Focused Equity Fund -4.5 6.4 ICICI Prudential Value Discovery Fund -3.3 -11.8 3.8 6.9 ICICI Prudential Long Term Equity Fund (Tax Saving) -1.3 -9.8 1.0 11.4 ICICI Prudential FMCG Fund -1.6 13.5 ICICI Prudential Banking & Financial Services 6.7 -11.4 3.3 9.8 ICICI Prudential Technology Fund -3.4 ICICI Prudential P.H.D Fund -1.3 -11.9 2.3 - ICICI Prudential Equity & Debt Fund 4.2 8.8 ICICI Prudential Equity Savings Fund 5.8 -8.8 4.7 - ICICI Prudential Ultra Short Term Fund 6.2 9.1 ICICI Prudential Savings Fund 5.7 -5.7 8.4 8.3 ICICI Prudential Money Market Fund 7.0 -3.1 9.3 7.8 ICICI Prudential Short Term Fund 5.6 -2.1 15.8 8.5 ICICI Prudential Medium Term Bond Fund 8.2 -11.3 - 8.1 ICICI Prudential Bond Fund 11.0 -3.8 6.5 8.9 ICICI Prudential Long Term Bond Fund 7.4 5.4 6.3 10.2 ICICI Prudential All Seasons Bond Fund 7.2 8.6 7.8 10.0 ICICI Prudential Corporate Bond Fund 5.9 8.8 7.8 8.4 ICICI Prudential Credit Risk Fund 7.4 8.5 7.5 8.4 ICICI Prudential Banking & PSU Debt Fund 9.0 9.7 7.4 8.7 ICICI Prudential Gilt Fund 4.2 7.6 6.7 10.1 ICICI Prudential Regular Savings Fund 1.7 11.5 7.1 9.4 ICICI Prudential Balanced Advantage Fund 0.1 18.5 8.7 8.2 ICICI Prudential Child Care Fund (Gift Plan) 10.5 8.0 6.7 9.9 7.6 8.4 7.5 9.8 7.6 12.5 7.5 6.4 7.6 2.5 6.6 -3.8 4.3 Source : NAV India; NAV for the growth option as on 05-09-2019. Past performance may or may not sustain in the future. It is requested to note that in accordance with SEBI Circular No. SEBI/HO/IMD/DF3/CIR/P/2017/114 dated October 06, 2017 and SEBI/HO/IMD/DF3/CIR/P/2017/126 dated December 04, 2017, certain Schemes of ICICI Prudential Mutual Fund are undergoing Fundamental Attribute change and mergers, as applicable. These changes will be effective from May 28, 2018. For further information please refer to notices and addendums available on our website in this regard. The portfolio of the scheme is subject to changes with in the provisions of the Scheme Information Document (SID) of the respective schemes. Please refer to the SID for investment pattern, strategy and risk factors. Tarakki Times is compilation of articles published in various newspapers/magazines. Due credit is given 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 of ICICI 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 updating any 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 for any 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 in any 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 in these sector(s)/stock(s). The recipient alone shall be fully responsible/are liable for any decision taken on this material. Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

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