Axis Corporate Debt Fund. (An open ended debt scheme predominantly investing in AA+ and above rated corporate bonds)

Transcription

1 Axis Corporate Debt Fund (An open ended debt scheme predominantly investing in AA+ and above rated corporate bonds)

2 Macro economic indicators are showing signs of stability Indicator Current* Outlook Inflation (CPI) 2.3% Interest Rate (Repo Rate) 6.5% RBI s focus on inflation is likely to keep rates stable over the year Real Rate 4.2% Positive real rates Crude (Brent $/bbl) 58.7 Falling crude has made the terms of trade once again back in India's favor. GDP (Annual Growth Rate) 7.1% Strong growth Forex Reserves BoP USD 394 bn USD -1.9bn India s strong external position CAD (as a % of GDP) -2.9% * Data as on 30 th Nov Source: Bloomberg 2

3 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 Dec-18 RBI is targeting for neutral liquidity OMOs and term repos helping offset the liquidity shortfall & controlling bond yields Trailing Interbank Liquidity : expected to be in neutral zone RBI scaled up OMO purchases to neutralize liquidity deficit Net Absorption (+)/Infusion(-) of Liquidity, US$ bn OMO, INR bn RBI increased OMO purchases to INR 500 Bn in Dec-18; announced purchases of INR 500 Bn for Jan Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19 Source: Morgan Stanley. Data as on 18 th Dec

4 We expect a stable rate scenario over the next few months Eased inflation 6.0 Operating rate close to Repo Dec-16 Jun-17 Dec-17 Jun-18 CPI - Combined 4.5 Dec-16 Jun-17 Dec-17 Jun-18 Dec-18 Repo CCIL-CBLO Overnight Rate Source: Morgan Stanley. Data as on 12 th Dec

5 We prefer short end over longer end of the curve Short end offers attractive spread over G-Sec & Repo Long end of to be range bound : Do not expect structural rally Repo 3 year AAA PSU 3 year G-Sec Yield 115 bps over GSec year G-Sec yield (%) Recent rally of >80bps bps over Repo Expect only tactical opportunities going forward Dec-16 Jun-17 Dec-17 Jun-18 Dec Dec-16 Jun-17 Dec-17 Jun-18 Dec-18 Source: Bloomberg, Data as on 12 th Dec

6 Key risks to watch Global growth, Crude, Food inflation and Fiscal are the key risks to watch for Brent Crude Price ($/barrel) : Increased volatility Brent crude price ($/barrel) 55 Nov-17 May-18 Nov-18 Impact of every $10 oil price increase CA Balance % -0.3% of GDP Inflation (CPI) 0.4% Fiscal balance 0.05% of GDP. FY19 GDP Growth Revised Down to 7.2% due to Inflationary Headwinds Fiscal Deficit: GST trends weak; can lead to higher than expected fiscal gap Food Inflation Revised Real GDP FY16 FY17 FY18 FY19F Food disinflation has led headline CPI to be significantly lower than RBI's target Jan-18 Apr-18 Jul-18 Oct Source: Bloomberg, Trading economics, India Ratings, Morgan Stanley, Axis MF Research, CLSA. Data as on 30 th Sep

7 Axis Corporate Debt Opportunities Fund Typical Average Maturity Range 6 to 18 months Typical Credit Quality 80% : AAA/A1+ 20% : Sub AAA Investment Horizon 6 months to 1 year Primary Investments Corporate Debt Securities No G-Sec Endeavor to look for opportunities from credit spreads Cautious at managing risk on its corporate investments Current Portfolio Allocation/Positioning is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the fixed income markets without any notice to investors. Axis Mutual Fund 7

8 Current Portfolio Statistics 30 th Nov 2018 Portfolio Statistics Average Maturity 1.8 years Modified Duration 1.4 years YTM 9.30% Instrument wise holdings Corporate Bonds 66.6% Money Market Instruments 27.3% G-Sec 1.7% PTC 4.3% Maturity Profile Rating- wise holdings Sovereign/ AAA & equivalent$ 82.9% AA- 5.3% A+ 9.6% A 0.8% A- 1.6% Upto 1 year 56% 1 to 3 years 30% 3 to 5 years 15% Current Portfolio Allocation/Positioning is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the fixed income markets without any notice to investors. Axis Mutual Fund 8

9 Performance as on 30 th Nov

10 Annexure for returns of schemes managed by fund manager Refer slide 13 for disclaimer. 10

11 Annexure for returns of schemes managed by fund manager Refer slide 13 for disclaimer. 11

12 Annexure for returns of schemes managed by fund manager Refer slide 13 for disclaimer. 12

13 Performance Disclaimer #Scheme Performance may not be strictly comparable with that of its additional benchmark in view of hybrid nature of the scheme. performance data for 5 years period has not been provided for scheme/plan not in existence for 5 performance data for 3 years period has not been provided for scheme/plan not in existence for 3 years. Data as on November 30, Past performance may or may not be sustained in future. Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs /- for Gold ETF & Rs. 10/- for all other schemes. Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. The above data excludes performance of Fixed Maturity Plans and all the schemes which have not completed a year. Top 3 and Bottom 3 schemes (based on 1 year performance) managed by Devang Shah has been provided herein. Devang Shah is managing Axis Liquid Fund, Axis Dynamic Bond Fund, Axis Gilt Fund, Axis Strategic Bond Fund and Axis Short Term Fund and all Axis Hybrid Funds since 5th November 2012 (since inception date for Axis Hybrid Funds launched after 5th November, 2012), Axis Credit Risk Fund and Axis Arbitrage Fund since inception and Axis Treasury Advantage Fund and Axis Regular Saver (Debt portion), Axis Gold Fund, Axis Gold ETF, all Axis Fixed Term Plans since 7th June, 2016 (since inception date for Axis Fixed Term Plans launched after 7th June, 2016) and Axis Corporate Debt Fund since July 13th, W.e.f January 1, 2013, Axis Short Term Fund - Institutional Plan, Axis Treasury Advantage Fund - Institutional Plan & Axis Liquid Fund - Institutional Plan have been renamed Axis Short Term Fund, Axis Treasury Advantage Fund & Axis Liquid Fund, respectively. 13

14 Product Labelling Fund Name Riskometer Product Labelling Axis Credit Risk Fund (An open ended debt scheme predominantly investing in AA and below rated corporate bonds (excluding AA+ rated corporate bonds) Axis Gilt Fund (An open ended debt scheme investing in government securities across maturity) This product is suitable for investors who are seeking* Stable returns in the short to medium term Investment in debt and money market instruments across the yield curve and credit spectrum. This product is suitable for investors who are seeking* Credit risk free returns over medium to long term Investment mainly in Government securities across maturities Axis Corporate Debt Fund (An open ended debt scheme predominantly investing in AA+ and above rated corporate bonds) This product is suitable for investors who are seeking*: Regular income over short to medium term Predominantly investing in corporate debt *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 14

15 Product Labelling Fund Name Riskometer Product Labelling Axis Hybrid Fund Series 5 (42 months close ended debt scheme) Axis Gold ETF (An open ended scheme replicating/tracking Domestic Price of Gold. Continuous Offer of Units in Creation Unit Size at NAV based prices. ) This product is suitable for investors who are seeking* Capital appreciation while generating income over medium to long term. To Investment in debt and money market Instruments as well as equity and equity related Instruments This product is suitable for investors who are seeking* Capital appreciation over medium to long term Investment predominantly in gold in order to generate returns similar to the performance of gold, subject to tracking error *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 15

16 Statutory Details and Risk Factors Data updated as on 30 th Nov Disclaimer: Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of disclosure of the portfolio of the Scheme(s) and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC). Risk Factors: Axis Bank Limited is not liable or responsible for any loss or shortfall resulting from the operation of the scheme. This document represents the views of Axis Asset Management Co. Ltd. and must not be taken as the basis for an investment decision. Neither Axis Mutual Fund, Axis Mutual Fund Trustee Limited nor Axis Asset Management Company Limited, its Directors or associates shall be liable for any damages including lost revenue or lost profits that may arise from the use of the information contained herein. No representation or warranty is made as to the accuracy, completeness or fairness of the information and opinions contained herein. The AMC reserves the right to make modifications and alterations to this statement as may be required from time to time. Scheme specific risk factors: Apart from the risks associated with domestic investments, the scheme may invest in overseas markets which carry risks related to fluctuations in the foreign exchange rates, the nature of the securities market of the country, repatriation of capital due to exchange controls and political circumstances. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). The material should not be construed as issued by Government of India or any of its authority. Mutual Fund Investments are subject to market risks, read all scheme related documents carefully. 16

17 Thank You