Monthly Market Outlook March Equity & Fixed Income Outlook

Transcription

1 Monthly Market Outlook March 2019 Equity & Fixed Income Outlook

2 Returns (%) Global Indices Performance China surges ahead China France Eurozone Switzerland Taiwan US Germany Japan Hong Kong UK Singapore South Korea India Indonesia Brazil Russia Returns Performance Feb Chinese equities have been steadily rising (up about 18%) since the start of this year backed by policy reform announcements Indian markets, on the other hand, remained nervous largely on account of domestic macro and security issues. Germany - DAX Index; China - SSE Composite Index; France - CAC 40 Index; Japan - Nikkei; Eurozone - Euronext 100; Hong Kong - HangSeng; US - Dow Jones; Singapore - Strait Times; Russia - RTS Index; Indonesia - Jakarta Composite Index; U.K. - FTSE; South Korea - Kospi; Brazil - Ibovespa Sao Paulo Index; Indonesia Jakarta Composite Index; Switzerland Swiss Market Index; Taiwan Taiwan Stock Exchange Corporation; India S&P BSE Sensex; Returns in % terms. Data Source: MFI; Returns are absolute returns for the PRI variant of the index calculated between Jan 31, 2019 Feb 28, Past performance may or may not be sustained in future 2

3 Auto Oil & Gas Realty Telecom CD Energy Basic Materials IT Infra HC CG Finance Metal FMCG Bankex Power Returns (%) Sectoral Indices Performance Returns Performance Feb Companies in the auto, oil & gas, realty, and telecom saw muted results However, the stock performances of companies in these sectors performed well during the month All indices are of S&P BSE and carry the prefix of S&P BSE; Abbreviated CD - S&P BSE Consumer Durables; CG - S&P BSE Capital Goods; FMCG - S&P BSE Fast Moving Consumer Goods; HC - S&P BSE Health Care; Infra. - S&P BSE India Infrastructure; IT - S&P BSE Information Technology, NBFC Non-banking Finance Companies. Data Source: MFI; Returns are absolute returns for the PRI variant of the index calculated between Jan 31, 2019 Feb 28, 2019; Past performance may or may not be sustained in future 3

4 EQUITY OUTLOOK SLOW DOWN IN GROWTH AND PICK UP IN EARNINGS 4

5 GDP (%) Growth Numbers GDP Data 9.0% 7.7% 8.0% 8.0% 7.0% 7.0% 6.6% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Q3 FY18 Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Source: CRISIL Research; Data as of Dec 2018: GDP Gross Domestic Product Indian Economy slowed down in Q3FY19 to 6.6% from 7.0% in Q2FY19 and 7.0% in Q3FY18. Activities related to capital expenditure slowed down which led to the fall in GDP. Consumption on the other side increased during the same time period 5

6 Q4F10 Q1F12 Q2F13 Q3F14 Q4F15 Q1F17 Q2F18 Q3F19 Revenue Growth Earnings Growth Earnings Recovery 30% Revenue Growth Earnings Growth (RS) 50% 25% 40% 20% 15% 10% 5% 0% -5% 30% 20% 10% 0% -10% Revenue growth has been rising steadily since Q1F17 while profit growth has only recently started on its upward trajectory -10% -20% Source: Company data, Morgan Stanley Research, Data as of Dec 31,

7 Jun-99 Dec-00 Jun-02 Dec-03 Jun-05 Dec-06 Jun-08 Dec-09 Jun-11 Dec-12 Jun-14 Dec-15 Jun-17 Dec-18 Jun-99 Dec-00 Jun-02 Dec-03 Jun-05 Dec-06 Jun-08 Dec-09 Jun-11 Dec-12 Jun-14 Dec-15 Jun-17 Dec-18 Revenue Growth Profit Growth Earnings Recovery Revenue growth has been rising steadily while profit growth has only recently started on its upward trajectory 100% 90% 80% 70% 60% 50% 40% 30% 20% % of Cos with >10% Revenue Growth 80% 70% 60% 50% 40% 30% % of Cos with >10% Net Profit Growth Source: Company data, Morgan Stanley Research, Data as of Dec 31, 2018; Data related to MS coverage universe 7

8 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 FPI flows (in USD mn) DMF flows (in USD mn) Feb 2019 Flows Month when FPIs came back Foreign Portfolio Investor (FPI) flows have been volatile in the last one-year period while domestic mutual fund (DMF) flows have moderated. 3,000 2,000 1, ,000-2,000-3,000-4,000-5,000 2,057 FPI Equity flows , ,314-3, ,153 3,500 3,000 2,500 2,000 1,500 1, Domestic MF Activity 2,014 1,719 1,425 1, ,607 3, Source: SEBI, BSE, CDSL, Morgan Stanley Research; Data as of Feb 28,

9 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Divergence between growth and value stocks 1-year forward P/E ratio of MSCI India growth and MSCI India value indices, (%) Value and special situation themes expected to play out during 2019 due to significant disconnect between price and value in many Growth and Value stocks MSCI growth index MSCI value index Source: Kotak Institutional Equities; Data as of Jan 31, 2019; P/E Price to Earnings 9

10 S&P Midcap Returns (%) S&P BSE Smallcap Returns (%) Cooling off Valuations In CY 2018, mid and small caps witnessed a significant correction post which valuations have cooled off. Investments in equity, particularly mid and small caps, should be in a staggered manner through SIP/STP. S&P BSE Midcap Index S&P BSE Small Cap Index Closed at 15,438 Closed at 14, Source: BSEIndia; Data as of Dec 31, 2018; Past performance may or may not be sustained in future 10

11 Outlook Neutral stance on equities as valuations look completely priced in and many events on the political and macro front to unfold during Accumulation phase of investing - Investments in equity, particularly mid and small caps, could be in a staggered manner through SIP/STP Recommend lump sum investment in asset allocation in large and multi-cap oriented schemes Value and special situation themes expected to play out during 2019 due to significant disconnect between price and value in many Growth and Value stocks Themes to be explored post the recent oil price correction: Banking and Infrastructure 11

12 Our Asset Allocation Bouquet These schemes aim to benefit from volatility and manage equity exposure based on valuations ICICI Prudential Regular Savings Fund* ICICI Prudential Equity Savings Fund ICICI Prudential Balanced Advantage Fund ICICI Prudential Multi-Asset Fund ICICI Prudential Equity & Debt Fund ICICI Prudential Asset Allocator Fund*# Conservative Hybrid Fund Equity Savings Fund Dynamic Asset Allocation or Balanced Advantage Fund Multi Asset Allocation^ Aggressive Hybrid Fund of Funds Net Equity 10-25% Net Equity 15-50% Net equity 30-80% Min of 10% in each of the 3 asset classes Equity, Debt, Gold/Gold ETF/ units of REITs and InvITs Net Equity 65-80% Net Equity Level*: 0-100% The asset allocation and investment strategy will be as per the Scheme Information Document, *These schemes will attract debt taxation. #Investors may note that they will be bearing the recurring expenses of this scheme in addition to the expenses of the underlying Schemes in which the scheme makes investment. ^ICICI Prudential Multi Asset Fund shall undergo change in its fundamental attributes effective from April 01,

13 ICICI Prudential Balanced Advantage Fund ICICI Prudential Balanced Advantage Fund (BAF) seeks to remove the psychological barrier (Greed & Fear) for its investors. The Scheme aims to follow a buy-low and sell-high strategy. Stock Selection Asset Allocation Derivative Strategy Blend of Large and Mid Cap Stocks Net Equity Level Range 30-80% based on In-House P/BV Model Derivative Exposure for Hedging / Portfolio Rebalancing P/BV Price to Book Value 13

14 Our Equity Recommendations Lump-sum Pure Equity Schemes ICICI Prudential Bluechip Fund ICICI Prudential Multicap Fund The scheme predominantly invests in large-cap stocks. It follows a benchmark hugging approach. The scheme invests in stocks across market capitalisations Thematic / Sectoral ICICI Prudential Infrastructure Fund ICICI Prudential Banking & Financial Services Fund ICICI Prudential India Opportunities Fund These thematic schemes are suitable for investors looking for exposure to various themes like Infrastructure, Banking, Special Situations respectively. 14

15 Our SIP Recommendations ICICI Prudential Value Discovery Fund ICICI Prudential Large & Midcap Fund ICICI Prudential Midcap Fund ICICI Prudential Smallcap Fund ICICI Prudential US Bluechip Equity Fund (An open ended equity scheme following a value investment strategy) (An open ended equity scheme investing in both largecap and midcap stocks) (An open ended equity scheme predominantly investing in mid cap stocks) (An open ended equity scheme predominantly investing in smallcap stocks) (An open ended equity scheme investing predominantly in securities of large cap companies listed in the United States of America.) 15

16 Feb-06 Feb-07 Feb-08 Feb-09 Feb-10 Feb-11 Feb-12 Feb-13 Feb-14 Feb-15 Feb-16 Feb-17 Feb-18 Feb-19 Equity Valuation Index Book Partial Profits Incremental Money to Debt Asset Allocation Invest in Equities Equity valuations show that the market valuations are in the zone where investors are recommended to invest in asset allocation category. 70 Aggressively invest in Equities 50 Equity Valuation index is calculated by assigning equal weights to Price-to-Earnings (PE), Price-to-Book (PB), G-Sec*PE and Market Cap to GDP ratio. G-Sec Government Securities. GDP Gross Domestic Product; Asset Allocation Schemes that invest both in equity and fixed income 16

17 FIXED INCOME OUTLOOK POSITIVE ON SHORTER END OF YIELD CURVE (1-3 YEARS) 17

18 Aug-17 Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 Oct-18 Dec-18 Feb-19 GST Collections (INR Crs) Fiscal Deficit GST Collections GST Collection (INR Crs) 1,20,000 1,00,000 95,633 1,03,459 97,247 80,000 60,000 40,000 20,000 0 Lower than expected GST Collections is further contributing to the Fiscal Deficit Source: CMIE, Data as of Feb 28, 2019; GST Goods & Services Tax 18

19 Feb-17 May-17 Aug-17 Nov-17 Feb-18 May-18 Aug-18 Nov-18 Feb-19 RBI OMOs (Net Purchases) (In INR Bn) OMOs Yields brought down artificially RBI OMOs (Net purchases) (In INR Bn) Recent Open Market Operations (OMOs) carried out by the RBI have resulted in yields coming off. Hence, this cannot be construed as structural growth in the economy. Source: CMIE, Data as of Feb 28,

20 Jun-15 Oct-15 Feb-16 Jun-16 Oct-16 Feb-17 Jun-17 Oct-17 Feb-18 Jun-18 Oct-18 Jan-19 Inflation (%) Inflation trajectory possibility of higher inflation in H2CY19 Downward inflation Best of food deflation could be behind us. Government s tax sops for middle class and incentives for farmers could put pressure on food inflation. This could lead to volatility at longer end of yield curve 1 0 Source: CRISIL Research, Data as of January 31,

21 RBI Stance - Recent Monetary Policy Meet Monetary policy stance changed from calibrated tightening to neutral Economic activity slowed in major emerging nations On liquidity crisis: Certain measures underway to ensure there is no liquidity scarcity Headline inflation is expected to remain soft in the near term Slowing global demand to pose headwinds Our View The Central Bank may opt for a follow-up rate cut in the upcoming policy meet. However, a series of rate cuts look challenging at this point in time. Hence it is prudent to stick to shorter end of the yield curve 21

22 Spread over Repo Rate (in bps) Corp bonds provide higher carry over G-Secs 300 Corporate Bond Spreads vs G-Sec Spreads AAA Corporate Bonds provide better spread over the repo rate than the G-Secs in the current market yr 3-yr 5-yr 10-yr AAA Corporte Bonds G-Sec Source: CRISIL Research, Data as of February 28, 2019; G-Sec Government Securities 22

23 Schemes with High Quality Instruments Scheme Name Average Maturity Yield to Maturity (YTM) Modified Duration Exposure to AAA* securities ICICI Prudential Money Market Fund Days 7.64% Days 94.60% ICICI Prudential Savings Fund Days 8.22% Days 73.40% ICICI Prudential Short Term Fund 1.83 Years 8.64% 1.42 Years 72.91% ICICI Prudential Corporate Bond Fund 1.94 Years 8.40% 1.45 Years 85.96% ICICI Prudential Banking & PSU Debt Fund 2.30 Years 8.50% 1.60 Years 71.54% Data as of February 28, 2019; Past performance may or may not be sustained in future. *AAA rated & equivalent securities 23

24 Yields (%) Corporate Bond spread over Repo High Margin of safety 9.5 Avg. 267 bps Avg. 75 bps Avg. 209 bps S P R E A D In the current scenario, corporate bonds could provide better risk-adjusted returns over G-Sec, as they are a cushion from any unforeseen event yr 3yr 5-yr 10-yr AAA AA G-Sec Repo rate Source: CRISIL Research; Data as of February 28,

25 Accrual Schemes Benefit from additional indexation benefits Scheme Name Yield to Maturity Modified Duration Macaulay Duration ICICI Prudential Credit Risk Fund 10.50% 1.20 Years 1.30 Years ICICI Prudential Medium Term Bond Fund 10.10% 1.85 Years 2.04 Years ICICI Prudential Floating Interest Fund 9.37% Days Days These schemes aim to provide better risk-adjusted returns basis a well researched investment process Data as of February 28, 2019; Past performance may or may not be sustained in future 25

26 Indexation Benefits Particulars Debt Mutual Fund with indexation Traditional Investment Avenue without indexation Amount Invested ` 1, ` 1,00,000 Assumed Rate of Return (CAGR %) 8.00% 8.00% No. of Days Maturity Proceeds ` 1,26,104 ` 1,26,104 Total Return/Interest for the period ` 26,104 ` 26,104 Indexation Benefit Yes No Indexed Cost of Investments (Assuming 4%) ` 1,12,486 Taxable Amount ` 13,618 ` 26,104 Applicable Tax Rate (Incl. Surcharge & Cess) NA 23.92% 35.88% Tax Liability ` 3,257 ` 9,366 Receipts net of Tax ` 1,22,847 ` 1,16,738 Post-tax return 7.07% 5.27% The above is provided only for general information purpose. In view of the different nature of the tax benefits, each investor is advised to consult with his or her own tax consultant with respect to specific tax implication arising out of their participation in schemes. In the above Illustration Traditional Investment avenue has been taxed at highest tax slab rate. Surcharge at the rate of 15% is applicable for Individuals and HUF's having total income exceeding Rs.1 crore, for income Rs.50 lakhs-rs.1 crore surcharge of 10% is applicable. The above rates are including Surcharge and Cess and is basis prevailing tax laws. For illustration purpose only. Actual results may vary. 26

27 Accrual Based Schemes Investment Process Well Researched Credit Universe Based on various filters, qualitative and quantitative research Broadened Exposure Mitigating concentration risk by diversification Managing Duration Risk Clearly defined modified duration range Strict Internal Limits at Issuer Level and rating level These schemes have an independent credit evaluation, approval, and monitoring process which does not solely rely on the Fund Manager s judgment to invest in a paper. These schemes focus on direct origination* which helps in alpha generation and monitoring. The asset allocation and investment strategy will be as per Scheme Information Document. *Direct origination means no involvement of intermediaries. 27

28 Mitigating Risk ICICI Prudential Credit Risk Fund* 13.3% in AAA & equivalent rated debt instruments, TREPS & Net Current Assets 88* different securities with average exposure of around 1.08% to each individual issuer Liquidity Management Concentration Management The portfolio is well diversified and invests across various credit ratings ranging between AAA to A- Credit Management Duration Management Duration Risk reduced by maintaining modified duration at the lower-end current modified duration 1.20 yrs All data as of February 28, 2019; *Portfolio includes CPs and CDs; The portfolio of the scheme is subject to changes with in the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors. The asset allocation and investment strategy will be as per Scheme Information Document. TREPS Tri Party Repos (An open ended debt scheme predominantly investing in AA and below rated corporate bonds) 28

29 ICICI Prudential Credit Risk Fund The scheme portfolio is well-diversified across a large number of securities which reduces risk pertaining to high exposure in a single security % Yield to Maturity 88 No. of securities in the scheme portfolio Aims to invest in well researched corporate bonds 1.08% 5.05% 32.3% Average exposure to a single security in the portfolio Highest exposure to single security in the portfolio Exposure (as % of NAV) to the top 10 holdings in the portfolio Aims to generate alpha from any potential credit upgrades Aims to deliver accrual income with Hold-to- Maturity approach Data as of February 28, 2019; The asset allocation and investment strategy will be as per the Scheme Information Document. The portfolio of the scheme is subject to changes within the provisions of the Scheme Information document; NAV Net Asset Value 29

30 Outlook Neutral stance on debt as well. Cautious on the longer end of yield curve due to fiscal concerns. Global Events, domestic fiscal stress & over-supply of bonds may lead to higher volatility. Hence, short duration space (1-3 Years) to be explored for better riskadjusted returns RBI may opt for a follow-up rate cut in the upcoming policy meet. However, a series of rate cuts look challenging at this point in time Accrual schemes have moved into buy territory with attractive valuations, reduced flows, and negative sentiments (NBFC liquidity crunch). Risk-reward benefit has turned favourable; good time to earn carry with high credit spreads available in the corporate bond space NBFC Non-Banking Financial Companies 30

31 Fixed Income Recommendations ICICI Prudential Floating Interest Fund ICICI Prudential Ultra Short Term Fund ICICI Prudential Medium Term Bond Fund ICICI Prudential Credit Risk Fund ICICI Prudential All Seasons Bond Fund ICICI Prudential Short Term Fund Cash Management Solution (which benefits from better risk adjusted returns) Accrual Schemes (which benefits from capturing yields at elevated levels) Dynamic Duration Schemes ( which benefits from volatility by actively managing duration) Low/Short Duration Schemes (which benefits from mitigating interest rate volatility) 31

32 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Aug-17 Oct-17 Dec-17 Feb-18 Apr-18 Jun-18 Aug-18 Oct-18 Dec-18 Feb-19 Debt Valuation Index Aggressively in High Duration Moderate Duration Low Duration Ultra Low Duration Low Duration High Duration High Duration Ultra Low Duration Moderate Duration 2.51 We recommend investors to invest in Ultra Low / Low Duration schemes or accrual schemes such as ICICI Prudential Credit Risk Fund. For those investors who aim to benefit from volatility we recommend investment in ICICI Prudential All Seasons Bond Fund. Debt Valuation Index considers WPI, CPI, Sensex YOY returns, Gold YOY returns and Real estate YOY returns over G-Sec yield, Current Account Balance and Crude Oil Movement for calculation. WPI Wholesale Price Index; CPI Consumer Price Index. None of the aforesaid recommendations are based on any assumptions. These are purely for reference and the investors are requested to consult their financial advisors before investing. 32

33 ICICI Prudential Asset Allocator Fund # Allocate between equity and debt at right time without tax impact* ICICI Prudential Asset Allocator Fund is an open ended Fund of Funds which has a flexibility to invest across equity and debt schemes# Investment Universe: Up to 100% in equity mutual fund schemes of ICICI Prudential Mutual Fund Up to 100% in debt mutual fund schemes of ICICI Prudential Mutual Fund Allocation between asset classes The Scheme will be actively managed by experienced Fund Managers. The Scheme allocates between equity and debt mutual fund schemes based on in-house valuation model. To hedge against inflation or in adverse market situations, the Scheme may invest up to 50% in gold mutual fund schemes. Note: Subscriptions under the dividend plan of the scheme have been discontinued w.e.f. March 06, 2019 *On change in allocation by the scheme. For more details on tax please consult with your tax advisor. The asset allocation and investment strategy will be as per Scheme Information Document. ) Investors may note that they will be bearing the recurring expenses of this scheme in addition to the expenses of the underlying Schemes in which the scheme makes investment. (# An open ended fund of funds scheme investing in equity oriented schemes, debt oriented schemes and gold ETFs/ schemes 33

34 Our Equity Schemes Scheme Name ICICI Prudential Bluechip Fund ICICI Prudential Large & Mid Cap Fund ICICI Prudential Midcap Fund ICICI Prudential Smallcap Fund ICICI Prudential Value Discovery Fund ICICI Prudential Multicap Fund ICICI Prudential Infrastructure Fund ICICI Prudential Banking & Financial Services Fund ICICI Prudential India Opportunities Fund Type of Scheme An open ended equity scheme predominantly investing in large cap stocks An open ended equity scheme investing in both large cap and mid cap stocks. An open ended equity scheme predominantly investing in mid cap stocks. An open ended equity scheme predominantly investing in small cap stocks. An open ended equity scheme following a value investment strategy. An open ended equity scheme investing across large cap, mid cap, small cap stocks. An open ended equity scheme following infrastructure theme. An open ended equity scheme investing in Banking & Financial Services Sector An Open Ended Equity Scheme following Special Situation theme 34

35 Our Hybrid Schemes / Fund of Funds Scheme Scheme Name ICICI Prudential Balanced Advantage Fund Type of Scheme An open ended dynamic asset allocation fund ICICI Prudential Regular Savings Fund ICICI Prudential Equity Savings Fund ICICI Prudential Equity & Debt Fund ICICI Prudential Multi-Asset Fund An open ended hybrid scheme investing predominantly in debt instruments An open ended scheme investing in equity, arbitrage and debt. An open ended hybrid scheme investing predominantly in equity and equity related instruments An open ended scheme investing in Equity, Debt, Gold/Gold ETF/units of REITs & InvITs and such other asset classes as may be permitted from time to time. Scheme Name ICICI Prudential Asset Allocator Fund Type of Scheme An open ended fund of funds scheme investing in equity oriented schemes, debt oriented schemes and gold ETFs/schemes. 35

36 Our Debt Schemes Scheme Name ICICI Prudential Ultra Short Term Fund ICICI Prudential Short Term Fund ICICI Prudential Medium Term Bond Fund ICICI Prudential Credit Risk Fund ICICI Prudential Floating Interest Fund ICICI Prudential All Seasons Bond Fund ICICI Prudential Savings Fund ICICI Prudential Banking & PSU Debt Fund ICICI Prudential Corporate Bond Fund ICICI Prudential Money Market Fund Type of Scheme An open ended ultra-short term debt scheme investing in instruments such that the Macaulay Duration* of the portfolio is between 3 months and 6 months. An open ended short term debt scheme investing in instruments such that the Macaulay duration of the portfolio is between 1 Year and 3 Years. An open ended medium term debt scheme investing in instruments such that the Macaulay duration of the portfolio is between 3 Years and 4 Years. The Macaulay duration of the portfolio is 1 Year to 4 years under anticipated adverse situation. An open ended debt scheme predominantly investing in AA and below rated corporate bonds. An open ended debt scheme predominantly investing in floating rate instruments (including fixed rate instruments converted to floating rate exposures using swaps/derivatives). An open ended dynamic debt scheme investing across duration. An open ended debt scheme with Macaulay Duration between 6-12 months An open ended debt scheme predominantly investing in Debt instruments of banks, Public Sector Undertakings, Public Financial Institutions An open ended debt scheme predominantly investing in AA+ or above rated securities. An open ended debt scheme investing in money market instruments *The Macaulay Duration is the weighted average term to maturity of the cash flows from a bond. The weight of each cash flow is determined by dividing the present value of the cash flow by the price. 36

37 Riskometers ICICI Prudential Multi-Asset Fund is suitable for investors who are seeking*: Long term wealth creation An open ended scheme investing in at least three asset classes with minimum allocation of 10% to each asset class. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Equity & Debt Fund is suitable for investors who are seeking*: Long term wealth creation solution A balanced fund aiming for long term capital appreciation and current income by investing in equity as well as fixed income securities. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Balanced Advantage Fund is suitable for investors who are seeking*: Long term wealth creation solution An equity fund that aims for growth by investing in equity and derivatives. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 37

38 Riskometers ICICI Prudential Bluechip Fund is suitable for investors who are seeking*: Long term wealth creation An open ended equity scheme predominantly investing in large cap stocks. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Value Discovery Fund is suitable for investors who are seeking*: Long term wealth creation An open ended equity scheme following a value investment strategy *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Large & Mid Cap Fund is suitable for investors who are seeking*: Long term wealth creation An open ended equity scheme investing in both largecap and mid cap stocks *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 38

39 Riskometers ICICI Prudential Regular Savings Fund is suitable for investors who are seeking*: Medium to long term regular income solution A hybrid fund that aims to generate regular income through investments primarily in debt and money market instruments and long term capital appreciation by investing a portion in equity. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Credit Risk Fund is suitable for investors who are seeking*: Medium term savings A debt scheme that aims to generate income through investing predominantly in AA and below rated corporate bonds while maintaining the optimum balance of yield, safety and liquidity *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Medium Term Bond Fund is suitable for investors who are seeking*: Medium term savings A debt scheme that invests in debt and money market instruments with a view to maximize income while maintaining optimum balance of yield, safety and liquidity *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 39

40 Riskometers ICICI Prudential Smallcap Fund is suitable for investors who are seeking*: Long Term wealth creation An open ended equity scheme that seeks to generate capital appreciation by predominantly investing in equity and equity related securities of small cap companies. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Short Term Fund is suitable for investors who are seeking*: Short term income generation and capital appreciation solution A debt fund that aims to generate income by investing in a range of debt and money market instruments of various maturities. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential All Seasons Bond Fund is suitable for investors who are seeking*: All duration savings A debt scheme that invests in debt and money market instruments with a view to maximize income while maintaining optimum balance of yield, safety and liquidity *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 40

41 Riskometers ICICI Prudential Floating Interest Fund is suitable for investors who are seeking*: Short term savings An open ended debt scheme predominantly investing in floating rate instruments *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Ultra Short Term Fund is suitable for investors who are seeking*: Short term regular income An open ended ultra-short term debt scheme investing in a range of debt and money market instruments *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Midcap Fund is suitable for investors who are seeking*: Long Term wealth creation An open-ended equity scheme that aims for capital appreciation by investing in diversified mid cap companies. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 41

42 Riskometers ICICI Prudential India Opportunities Fund (The scheme is suitable for investors who are seeking*) Long term wealth creation An equity scheme that invests in stocks based on special situations theme. *Investors should consult their financial advisors if in doubt about whether the product is suitable for them. ICICI Prudential Infrastructure Fund is suitable for investors who are seeking:* Long term wealth creation An open-ended equity Scheme that aims for growth by primarily investing in companies belonging to infrastructure and allied sectors *Investors should consult their financial advisors if in doubt about whether the product is suitable for them. ICICI Prudential Banking & Financial Services Fund is suitable for investors who are seeking:* Long term wealth creation An open-ended equity Scheme that that predominantly invests in equity and equity related securities of companies engaged in banking and financial services *Investors should consult their financial advisors if in doubt about whether the product is suitable for them. 42

43 Riskometers ICICI Prudential Equity Savings Fund is suitable for investors who are seeking*: Long term wealth creation An open ended scheme that seeks to generate regular income through investments in fixed income securities, arbitrage and other derivative strategies and aim for long term capital appreciation by investing in equity and equity related instruments. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential Multicap Fund is suitable for investors who are seeking*: Long term wealth creation An open ended equity scheme investing across largecap, mid cap and small cap stocks. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them ICICI Prudential US Bluechip Equity Fund is suitable for investors who are seeking*: Long term wealth creation An open ended equity scheme primarily investing in equity and equity related securities of companies listed on recognized stock exchanges in the United States of America *Investors should consult their financial advisers if in doubt about whether the product is suitable for them 43

44 Riskometers ICICI Prudential Savings Fund is suitable for investors who are seeking*: Short term savings An open ended low duration debt scheme that aims to maximize income by investing in debt and money market instruments while maintaining optimum balance of yield, safety and liquidity *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. ICICI Prudential Banking & PSU Debt Fund is suitable for investors who are seeking*: Short term savings An open ended debt scheme predominantly investing in Debt instruments of banks, Public Sector Undertakings, Public Financial Institutions and Municipal Bonds *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. ICICI Prudential Corporate Bond Fund is suitable for investors who are seeking*: Short term savings An open ended debt scheme predominantly investing in highest rated corporate bonds *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 44

45 Riskometers ICICI Prudential Money Market Fund is suitable for investors who are seeking*: Short term savings A money market scheme that seeks to provide reasonable returns, commensurate with low risk while providing a high level of liquidity *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. ICICI Prudential Asset Allocator Fund (An open ended fund of funds scheme investing in equity oriented schemes, debt oriented schemes and gold ETFs/ schemes) is suitable for investors who are seeking*: Long Term wealth creation An open ended fund of funds scheme investing in equity oriented schemes, debt oriented schemes and gold ETF/schemes. *Investors should consult their financial advisors if in doubt about whether the product is suitable for them. LOW Moderate Investors understand that their principal will be at Moderately high risk HIGH 45

46 Disclaimer For Mutual Funds Mutual Fund investments are subject to market risks, read all scheme related documents carefully. All figures and other data given in this document are dated. The same may or may not be relevant at a future date. The AMC takes no responsibility of updating any data/information in this material from time to time. The information shall not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ICICI Prudential Asset Management Company Limited. Prospective investors are advised to consult their own legal, tax and financial advisors to determine possible tax, legal and other finan- cial implication or consequence of subscribing to the units of ICICI Prudential Mutual Fund. Past Performance may or may not be sustained in future. Disclaimer: In the preparation of the material contained in this document, ICICI Prudential Asset Management Company Ltd. (the AMC) has used information that is publicly available, including Budget speech and information developed in-house. The stock(s)/sector(s) mentioned in this slide do not constitute any recommendation and ICICI Prudential Mutual Fund may or may not have any future position in this stock(s). Some of the material used in the document may have been obtained from members/persons other than the AMC and/or its affiliates and which may have been made available to the AMC and/or to its affiliates. Information gathered and material used in this document is believed to be from reliable sources. The AMC however does not warrant the accuracy, reasonableness and / or completeness of any information. We have included statements / opinions / recommendations in this document, which contain words, or phrases such as will, expect, should, believe and similar expressions or variations of such expressions, that are forward looking statements. Actual results may differ materially from those suggested by the forward looking statements due to risk or uncertainties associated with our expectations with respect to, but not limited to, exposure to market risks, general economic and political conditions in India and other countries globally, which have an impact on our services and / or investments, the monetary and interest policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices etc. ICICI Prudential Asset Management Company Limited (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. Further, the information contained herein should not be construed as forecast or promise or investment advice. The recipient alone shall be fully responsible/are liable for any decision taken on this material. 46