The Asset Factsheet July 2017

Transcription

1 The Asset Factsheet July 2017

2 Index Fund Manager Commentary HSBC Equity Fund HSBC India Opportunities Fund HSBC Midcap Equity Fund HSBC Infrastructure Equity Fund HSBC Tax Saver Equity Fund HSBC Dynamic Fund HSBC Emerging Markets Fund HSBC Asia Pacific (Ex Japan) Dividend Yield Fund HSBC Brazil Fund HSBC Managed Solutions India - Growth HSBC Managed Solutions India - Moderate HSBC Managed Solutions India - Conservative HSBC Global Consumer Opportunities Fund Fund Managers - Equity Fund Manager Wise Comparative Performance of Equity Schemes SIP Performance of Equity Schemes HSBC Monthly Income Plan HSBC Income Fund - Investment Plan HSBC Income Fund - Short Term Plan HSBC Cash Fund HSBC Ultra Short Term Bond Fund HSBC Flexi Debt Fund Fund Managers - MIP & Debt Fund Manager Wise Comparative Performance of Debt Schemes Section II - How to read Factsheet

3 Fund Manager Commentary Equity markets recorded fresh highs After a consolidation phase seen during the previous month, the equity markets rallied strongly in July and marked fresh highs on the market indices. CNX Nifty index crossed 10,000 level for the first time, helped by strong flows, good monsoons, expectation of policy rate cut and upbeat sentiment aided by the landmark GST implementation. The market indices CNX Nifty and BSE Sensex were up 5.8% & 5.2% respectively while BSE Midcap and Smallcap indices gained 5.1% & 4.4% respectively during the month. Indices Performance - July % 5.0% Returns % 4.0% 3.0% 2.0% 1.0% - 0.0% Sensex Nifty BSE200 BSE500 BSE MidCap Source: Bloomberg; Bombay Stock Exchange (BSE) BSE SmallCap July was the first month after the country embraced the new indirect tax regime viz the GST. There could be challenges in the near term due to the enormity of such a transition into a new tax structure but markets, rightly seem to be looking beyond the brief period of disruption given the long term benefits for the economy. The 1QFY18 results season is past the halfway mark and has turned out to be broadly in-line with market expectations on headline numbers. As expected, GST transition related impact was seen in consumer centric companies due to the de-stocking aspect ahead of the July roll-out. However as mentioned, the market participants are likely to look beyond this near term disruption, while some impact could be felt in 2QFY18 as well. The Monsoon trends have been good so far with rainfall at 2% above the Long Period Average (LPA) for the season (till 31 July). This is tracking well with the India Meteorological Department's (IMD) forecast of a normal rainfall this season (98% of LPA forecasted by IMD). The rainfall has been excess or normal in 30 out of the 36 meteorological subdivisions and only rest 6 subdivisions have seen deficient rainfall. The inflation data points continued to soften with the June Consumer Price Index or CPI reading recording a low for the current series at 1.54% YoY from 2.18% YoY in May. The core inflation trends also remained soft. The Wholesale Price Index or WPI inflation moderated to 0.9% YoY from 2.17% YoY recorded in May. The easing of inflation has led to a consensus expectation of a 25 bps reduction in the policy rate in RBI's meeting on 02 August. External Institutional Fund Flows The net buying trend from FIIs (Foreign Institutional Investors) moderated for the second month in a row at about USD 390 mn of net inflows versus about USD 610 mn in June. The calendar year to date or CYTD net inflows figure from the FII segment climbed up to an impressive tally of about USD 8.8 bn (this compares to USD 2.9 bn and USD 3.3 bn of net inflows in CY16 & CY15 respectively). The Domestic MFs on the other hand saw a continued net buying momentum and raked up about USD 1.83 bn of net inflows in July (about USD 1.41 bn in June). The overall tally from the Domestic Institutional Investors (DIIs), moderated a bit at about USD 742 mn due to about USD 1.09 bn net outflows seen from the domestic insurers. On a CYTD basis, the DII segment has seen net inflows of about USD 4 bn entirely driven by about USD 8.2 bn net inflows from the domestic MFs while the domestic insurance segment has witnessed net outflows worth about USD 4.1 bn. Global Economic Scenario On expected lines, the US Federal Reserve kept the policy unchanged during its July meeting, reiterating the expectation of stabilization in inflation around the 2% level for the medium term. Data releases in the US were good during the month with the advance release of 2Q GDP at 2.6% quarter-on-quarter annualised (+1.2% previously). Sentiment indicators (e.g. ISM surveys and the Conference Board Consumer Confidence index) also remained high. In the Euro region, recent data releases were good with 2Q GDP growth accelerating to 0.6% quarteron-quarter. China 2Q GDP also delivered a decent growth at 6.9% YoY and this tracked slightly higher than the official growth target of around 6.5% for full year Oil prices rallied during the month (up 7.6%), as data showed a fall in US crude inventories, whilst OPEC members indicated that deeper production cuts could be possible. 01

4 Fund Manager Commentary Equity Market Outlook Markets brushed aside concerns around the near term impact of the GST roll-out process and revived the upward momentum during July after a brief pause seen in the previous month. CNX Nifty and S&P BSE Sensex indices have gained 23.1% & 22.1% respectively so far this calendar year. This performance is broadly in-line with the other comparable global market indices with the gain in MSCI India index at 28.4% in USD for Year to date or YTD period, aided by appreciation in INR versus the USD. During the same period, MSCI Emerging Market index was up 23.7%, MSCI EM Asia by 28.3% and MSCI China at 34%. So this rally was well supported by positive global sentiments apart from domestic factors. Looking ahead, the GST regime will lead to faster formalization of the economy, broaden the tax base, improving the fiscal situation and improve the ease of doing business. However, its roll-out will likely bring some challenges. Organized sectors and larger companies will be better equipped to cope with the new system, while the unorganized sector and smaller companies could face initial hurdles. We believe the situation will likely normalize over the next two-three quarters. As mentioned, on a CYTD basis the equity markets has churned out impressive gains. This performance through this calendar year was backed by strong liquidity driven by both FIIs & domestic MFs, positive global cues and expectation of the continuation of favorable policy environment domestically. However, after this strong performance, the equity markets are currently trading above their historical averages. The government's resolve and commitment to bring in more reforms, revival in corporate earnings, traction in NPA resolution and the likelihood of a normal Monsoon makes us positive on equity markets from a medium to long term perspective. We, in our investment process remain constructive on the India growth story and urge investors to stay invested in equities and look at this asset class as an avenue for long term wealth creation. Apart from the near term challenges connected with the GST roll-out, other risks to the market performance are in the form of valuations trending above historical averages and weaker than expected delivery in corporate earnings going forward. External news flows related to geopolitical tensions and other eco-political events would also influence market performance going forward, as the recent rally in the markets was supported by strong flows. RBI's Monetary Policy, Economic Events and Data Inflation CPI - Consumer Price Index or CPI - Headline CPI at 1.54% undershot the lower range of the RBI's target band of 4% (+/- 2%). This is lowest inflation experienced by India driven by continued disinflation in food and pulse prices. Fuel prices were also lower driven by price cuts domestically. Core inflation was lower and benign at 4% as compared to 4.2% in the previous month. WPI - Wholesale Price Index or WPI - WPI inflation was lower at 0.9% in June from 2.2% in May driven by lower food and fuel prices. However, manufactured inflation was unchanged at 2.1% on a y-o-y (year on year) basis. Food prices fell by 1.2% in June as compared to a 0.1% rise in May. Inflation Growth (%) Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 Feb-15 Apr-15 Jun-15 CPI Inflation (%) Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Feb-17 Apr-17 Jun-17 Source: Bloomberg; Central Statistical Organization (CSO) India Consumer Price Index (CPI) IIP - India's Industrial Production or IIP IIP was lower at 1.7% in May vs 3.1%in April. The consumer sector growth offset the weakness in the basic goods. The underlying momentum continues to remain sluggish as the investment growth does not reflect any momentum. Growth % Index of Industrial Production (IIP)* new series data Jan/13 Mar/13 May/13 Jul/13 Sep/13 Nov/13 Jan/14 Mar/14 May/14 Jul/14 Sep/14 Nov/14 Jan/15 Mar/15 May/15 Jul/15 Sep/15 Nov/15 Jan/16 Mar/16 May/16 Jul/16 Sep/16 Nov/16 Jan/17 Mar/17 May/17 Source: Bloomberg IIP YoY Growth in % (New Series; base ) 02

5 Fund Manager Commentary Trade deficit Trade Balance - The trade deficit narrowed to USD 13bn in June from USD 13.8bn in May. Export growth moderated sharply to 4.4% y-o-y in June from 8.3% in May. Non-oil export growth slowed for the third consecutive month to 4.5% y-o-y from 6.6% in May. The underlying trend remains mixed, with exports of engineering goods picking up sharply, agriculture exports maintaining a strong run-rate, but exports of labour intensive sectors (textiles, leather, gems & jewelry) contracting. Import growth eased to 19% y-o-y from 33.1% in May. Oil imports rose despite lower oil prices, while gold imports moderated to USD 2.5bn in June from USD 5bn in May. Moderation of imports was also due to GST implementation. RBI Policy Amidst a near consensus market opinion, RBI announced a 25 bps rate cut while maintaining a neutral stance and reiterating commitment to keeping headline inflation close to 4%. The factors supportive for the rate cut were a) base line inflation and core inflation have fallen below expectations b) GST roll out has been smooth c) monsoon has been normal so far d) international commodity prices are stable and e) there is an urgent need to reinvigorate private investment. Overall, this rate cut was in line with expectation of a neutral stance but suggests that RBI will remain watchful of incoming data. Market Activity Markets RBI announced an Open Market Operations or OMO of Rs.10,000Cr and markets reacted sharply and touched a near time high of 6.62% although markets were quick to recover as inflation data was largely bond yield supportive. The markets recovered the trading losses in 3 to 4 trading sessions. Markets rallied back to previous highs of 6.42%. However, markets were unable to break the level of 6.42% as a 25 bps rate cut is fully priced in. RBI continues to announce OMOs and the next OMO of Rs.10,000Cr is scheduled post policy on Aug 10. Money market flush with liquidity Liquidity continued to remain positive through the month. Short term yields have remained steady. Going Forward With this rate cut and a balanced policy, with a demand supply equation marginally negative and low credit offtake leading to demand from banks, we see a case for spread compression in corporate bonds, SDL and semi liquid G-Sec segments. Tactical duration movements may be necessary as the market may be range bound before the next trigger. The favourable global environment with lower inflation and growth in the domestic numbers can possibly act as the next trigger. We will wait for a confirmation before putting on those trades in place. Repo Rate Movement Rate % 10.00% 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% Jul/07 Dec/07 May/08 Oct/08 Mar/09 Aug/09 Jan/10 Jun/10 Nov/10 Apr/11 Sep/11 Feb/12 Jul/12 Dec/12 May/13 Oct/13 Mar/14 Aug/14 Jan/15 Jun/15 Nov/15 Apr/16 Sep/16 Feb/17 Jul/17 Repo Rate Source: Bloomberg, for all data except where mentioned otherwise 03

6 Fund Manager Commentary Sectors HSBC Equity Fund # HSBC India Opportunities Fund # HSBC Midcap Equity Fund Consumer Discretionary Consumer Staples Energy Financials Healthcare Industrials Information Technology Materials Telecommunication Utilities Overweight Underweight Neutral #The benchmark for HSBC Equity Fund and HSBC India Opportunities Fund have changed w.e.f. 11th November, 2016 as a more suitable benchmark was identified which better matched the portfolio strategy. There has been no change to investment management of the scheme. Review: HSBC Equity Fund Positive Contributors Healthcare & Utilities being underweight & certain stock (s) selection helped performance Financials & Materials being overweight & certain stock (s) selection helped performance Consumer Staples being underweight helped performance Negative Contributors Information Technology & Telecommunication - being underweight & certain stock (s) selection hurt performance Industrials certain stock (s) selection hurt performance Energy being underweight hurt performance Consumer Discretionary being overweight hurt performance Review: HSBC India Opportunities Fund Positive Contributors Financials & Materials being overweight & certain stock (s) selection helped performance Healthcare being underweight & certain stock (s) selection helped performance Consumer Staples & Utilities - being underweight helped performance Negative Contributors Consumer Discretionary & Industrials certain stock (s) selection hurt performance Energy & Telecommunication being underweight hurt portfolio Review: HSBC Midcap Equity Fund Positive Contributors Information Technology - certain stock (s) selection helped performance Consumer Discretionary, Telecommunication & Utilities - being underweight helped performance Negative Contributors Energy being underweight & certain stock (s) selection hurt performance Industrials, Financials, Consumer Staples & Materials - certain stock (s) selection hurt performance Review: HSBC Dynamic Fund The cash levels and sector allocation in the fund are likely to change depending on the market conditions and technical factors. Review: HSBC Monthly Income Plan Our current exposure is 23.62% in HMIP. Currently it is more biased towards large caps than mid or small caps 04

7 HSBC Equity Fund (HEF) An Open Ended Diversified Equity Scheme Investment Objective: Aims to generate long term capital growth from an actively managed portfolio of equity and equity related securities. FUND DETAILS Date of Allotment $ Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.40% Direct Plan 1.70% Excludes GST on Investment Management fees of 0.28% of Total Net Assets. Portfolio Turnover 0.92 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. $The benchmark was changed w.e.f. 11th November, 2016 as a more suitable benchmark was identified which better matched the portfolio strategy. There has been no change to investment management of the scheme. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Auto 9.52% Auto Ancillaries 1.89% Banks 29.41% Cement 3.50% Construction Project 5.54% Consumer Non Durables 5.52% Ferrous Metals 1.32% Finance 11.00% Media & Entertainment 1.21% Non - Ferrous Metals 4.33% Oil 1.31% Pesticides 1.36% Petroleum Products 5.62% Pharmaceuticals 3.86% Power 2.52% Software 7.08% Telecom - Services 1.43% Other Equity Investments 1.41% Reverse Repos/CBLOs 0.86% Net Current Assets 1.31% This product is suitable for investors who are seeking*: To create wealth over long term Investment in equity and equity related securities HSBC Equity Fund (HEF) LOW 10-Dec-02 Nifty 50 ` Neelotpal Sahai Available `10,000 `1,000 p.m.(sip) Nil 4.47% Riskometer Moderate 63, Investors understand that their principal will be at risk HIGH * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. FUND PORTFOLIO Issuer Auto Maruti Suzuki India 3, % Tata Motors 2, % Auto Ancillaries Motherson Sumi Systems 1, % Banks HDFC Bank 6, % ICICI Bank 5, % Indusind Bank 2, % Yes Bank 2, % Kotak Mahindra Bank 1, % Cement Dalmia Bharat 1, % Shree Cement % Construction Project Larsen & Toubro 3, % Consumer Non Durables ITC 3, % Ferrous Metals Tata Steel % Finance HDFC 3, % Bajaj Finserv 1, % LIC Housing Finance 1, % Bajaj Finance % Media & Entertainment Sun TV Network % Non - Ferrous Metals Vedanta 2, % Oil Oil & Natural Gas Corporation % Pesticides UPL % Petroleum Products Reliance Industries 3, % Pharmaceuticals Aurobindo Pharma 1, % Glenmark Pharmaceuticals % Power Power Grid Corporation Of India % NTPC % Software Infosys 2, % HCL Technologies 1, % Tech Mahindra % Telecom - Services Idea Cellular % Other Equity Investments % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC Equity Fund - Dividend 27-Jun Nov Nov HSBC Equity Fund - Dividend - Direct Plan 27-Jun Nov Nov Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 05

8 HSBC India Opportunities Fund (HIOF) An Open Ended Flexi-Cap Equity Scheme Investment Objective: Seeks long term capital growth through investments across all market capitalisations, including small, mid and large cap stocks. It aims to be predominantly invested in equity & equity related securities. However it could move a significant portion of its assets towards fixed income securities if the fund manager becomes negative on equity markets. FUND DETAILS Date of Allotment $ Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.43% Direct Plan 1.73% Excludes GST on Investment Management fees of 0.23% of Total Net Assets. Portfolio Turnover Asset Allocation 0.40 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. $The benchmark was changed w.e.f. 11th November, 2016 as a more suitable benchmark was identified which better matched the portfolio strategy. There has been no change to investment management of the from March 1, 2013 for prospective investments. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Auto 7.31% Auto Ancillaries 2.66% Banks 26.16% Cement 3.78% Chemicals 1.88% Construction 2.47% Construction Project 2.71% Consumer Durables 1.27% Consumer Non Durables 3.88% Ferrous Metals 2.47% Finance 11.03% Industrial Products 3.45% Media & Entertainment 1.06% Non - Ferrous Metals 3.81% Pesticides 1.59% Petroleum Products 3.81% Pharmaceuticals 4.19% Software 6.51% Telecom - Services 1.26% Textile Products 2.76% Other Equity Investments 4.82% Reverse Repos/CBLOs 2.42% Net Current Assets -1.30% HSBC India Opportunities Fund (HIOF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in equity and equity related securities across market capitalisations LOW 24-Feb-04 S&P BSE 200 ` , Neelotpal Sahai Available `10,000 `1,000 p.m.(sip) Nil Riskometer Moderate 4.88% Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH FUND PORTFOLIO Issuer Market Value (` in Lacs) % to Net Assets Auto Tata Motors 2, % Eicher Motors 1, % Auto Ancillaries Balkrishna Industries % Exide Industries % Banks HDFC Bank 5, % ICICI Bank 3, % Yes Bank 2, % Indusind Bank 2, % Cement Dalmia Bharat 1, % JK Cement 1, % Chemicals Vinati Organics 1, % Construction Somany Ceramics % Ahluwalia Contracts (India) % Construction Project Larsen & Toubro 1, % Consumer Durables Blue Star % Consumer Non Durables ITC 2, % Ferrous Metals Srikalahasthi Pipes % Jindal Steel & Power % Finance Bajaj Finance 2, % Manappuram Finance 1, % JM Financial 1, % LIC Housing Finance 1, % Industrial Products Supreme Industries 1, % Astral Poly Technik % Media & Entertainment Dish TV India % Non - Ferrous Metals Vedanta 2, % Pesticides UPL % Petroleum Products Reliance Industries 2, % Pharmaceuticals Aurobindo Pharma 1, % Glenmark Pharmaceuticals % Software Infosys 2, % HCL Technologies 1, % Telecom - Services Idea Cellular % Textile Products Welspun India % Arvind % Other Equity Investments 2, % Cash Equivalents CBLO 1, % Net Current Assets % Total Net Assets as on 31-Jul , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC India Opportunities Fund - Dividend 17-Mar Nov Mar HSBC India Opportunities Fund - Dividend Direct Plan 17-Mar Nov Mar Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 06

9 HSBC Midcap Equity Fund (HMEF) An Open Ended Diversified Equity Scheme Investment Objective: Seeks to generate long term capital growth from an actively managed portfolio of equity and equity related securities primarily being midcap stocks. However, it could move a portion of its assets towards fixed income securities if the fund manager becomes negative on the Indian equity markets. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.46% Direct Plan 1.76% Excludes GST on Investment Management fees of 0.24% of Total Net Assets. Portfolio Turnover 0.34 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation 19-May-05 S&P BSE Midcap ` , Dhiraj Sachdev Available `10,000 `1,000 p.m.(sip) Nil 5.85% Auto 3.94% Auto Ancillaries 2.40% Banks 2.00% Cement 3.47% Chemicals 11.06% Construction 2.73% Construction Project 1.57% Consumer Non Durables 6.82% Ferrous Metals 2.61% Finance 31.03% Industrial Capital Goods 3.85% Industrial Products 3.81% Media & Entertainment 4.35% Minerals/Mining 2.77% Pesticides 3.69% Petroleum Products 1.68% Pharmaceuticals 3.16% Power 1.38% Software 2.14% Textiles - Synthetic 1.52% Other Equity Investments 3.72% Reverse Repos/CBLOs 0.96% Net Current Assets -0.66% HSBC Midcap Equity Fund (HMEF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in predominantly mid cap equity and equity related securities LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH FUND PORTFOLIO Issuer Market Value (` in Lacs) % to Net Assets Auto VST Tillers Tractors 1, % Auto Ancillaries Apollo Tyres 1, % Banks Federal Bank % Cement Deccan Cements 1, % Chemicals Vinati Organics 2, % Balaji Amines 1, % Navin Fluorine International 1, % Construction IRB Infrastructure Developers % Ahluwalia Contracts (India) % Construction Project Power Mech Projects % Consumer Non Durables CCL Products (India) 1, % Kaveri Seed Company 1, % Ferrous Metals Srikalahasthi Pipes 1, % Finance Motilal Oswal Financial Services 2, % Manappuram Finance 2, % Indiabulls Housing Finance 2, % Bharat Financial Inclusion 2, % Muthoot Finance 1, % Cholamandalam Investment & Fin Co. 1, % Dewan Housing Finance Corporation 1, % JM Financial 1, % Industrial Capital Goods Sanghvi Movers 1, % Inox Wind % Industrial Products Ramkrishna Forgings 1, % Jain Irrigation Systems % Media & Entertainment Jagran Prakashan 1, % Hindustan Media Ventures % Minerals/Mining Gujarat Mineral Development Corporation 1, % Pesticides UPL 1, % PI Industries % Petroleum Products GOCL Corporation % Pharmaceuticals Aurobindo Pharma 1, % Power Kalpataru Power Transmission % Software Sonata Software 1, % Textiles - Synthetic Sarla Performance Fibers % Other Equity Investments 1, % Cash Equivalents CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC Midcap Equity Fund - Dividend 19-Nov Nov Nov HSBC Midcap Equity Fund - Dividend - Direct Plan 02-Nov Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 07

10 HSBC Infrastructure Equity Fund (HIEF) An Open Ended Equity Scheme Investment Objective: Seeks to generate long term capital growth from an actively managed portfolio of equity and equity related securities by investing primarily in sectors, areas and themes that play an important role in, and/or benefit from India's progress, reform process and economic development. FUND DETAILS Date of Allotment $ Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 23-Feb-06 S&P BSE India Infrastructure Index ` , Dhiraj Sachdev Available `10,000 `1,000 p.m.(sip) Nil 5.65% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.62% Direct Plan 1.92% Excludes GST on Investment Management fees of 0.30% of Total Net Assets. Portfolio Turnover 0.23 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. $The benchmark was changed w.e.f. 11th November, 2016 as a more suitable benchmark was identified which better matched the portfolio strategy. There has been no change to investment management of the scheme. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Banks 2.63% Cement 8.49% Construction 11.78% Construction Project 2.46% Ferrous Metals 9.05% Finance 3.55% Gas 3.50% Industrial Capital Goods 4.99% Industrial Products 8.35% Minerals/Mining 7.08% Petroleum Products 8.39% Power 15.83% Transportation 9.24% Other Equity Investments 3.53% Reverse Repos/CBLOs 2.07% Net Current Assets -0.94% HSBC Infrastructure Equity Fund (HIEF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in equity and equity related securities, primarily in themes that play an important role in India's economic development LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH FUND PORTFOLIO Issuer Banks Karnataka Bank % Cement Deccan Cements % Grasim Industries % Construction IRB Infrastructure Developers % NBCC India % KNR Constructions % Ahluwalia Contracts (India) % Construction Project Larsen & Toubro % Power Mech Projects % Ferrous Metals Srikalahasthi Pipes % Jindal Saw % Finance Rural Electrification Corporation % Gas Gujarat State Petronet % Industrial Capital Goods Sanghvi Movers % Inox Wind % Industrial Products KEI Industries % FAG Bearings India % Minerals/Mining Gujarat Mineral Development Corporation 1, % Petroleum Products Indian Oil Corporation % Hindustan Petroleum Corporation % GOCL Corporation % Power Adani Transmission % Power Grid Corporation Of India % PTC India % Reliance Infrastructure % JSW Energy % Transportation Adani Ports & Special Economic Zone % Gateway Distriparks % Gujarat Pipavav Port % Other Equity Investments % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC Infrastructure Equity Fund Dividend 11-May May Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 08

11 HSBC Tax Saver Equity Fund (HTSF) An Open Ended Equity Linked Savings Scheme (ELSS) Investment Objective: Aims to provide long term capital appreciation by investing in a diversified portfolio of equity & equity related instruments of companies across various sectors and industries, with no capitalisation bias. The Fund may also invest in fixed income securities. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 05-Jan-07 S&P BSE 200 ` , Aditya Khemani Available `500 (Lumpsum & SIP) Nil 4.58% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.58% Direct Plan 1.88% Excludes GST on Investment Management fees of 0.29% of Total Net Assets. Portfolio Turnover 0.61 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Auto 5.81% Auto Ancillaries 5.22% Banks 30.24% Cement 5.76% Construction 3.29% Construction Project 2.67% Consumer Durables 2.99% Consumer Non Durables 6.81% Finance 7.23% Industrial Products 7.80% Media & Entertainment 1.39% Non - Ferrous Metals 2.38% Petroleum Products 3.58% Pharmaceuticals 6.17% Software 3.16% Textile Products 1.55% Textiles - Cotton 1.67% Transportation 1.33% Other Equity Investments 0.08% Reverse Repos/CBLOs 0.98% Net Current Assets -0.11% HSBC Tax Saver Equity Fund (HTSF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in equity and equity related securities with no market capitilastion bias LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH FUND PORTFOLIO Issuer Market Value (` in Lacs) % to Net Assets Auto Maruti Suzuki India 1, % Auto Ancillaries MRF % Amara Raja Batteries % Exide Industries % Banks HDFC Bank 1, % ICICI Bank 1, % Indusind Bank 1, % Federal Bank % DCB Bank % Axis Bank % Cement NCL Industries % OCL India % Construction Somany Ceramics % Construction Project Larsen & Toubro % Consumer Durables Blue Star % Crompton Greaves Consumer Electrical % Consumer Non Durables Heritage Foods % United Spirits % ITC % Glaxosmithkline Consumer Healthcare % Finance HDFC % JM Financial % LIC Housing Finance % Industrial Products Finolex Cables % Nilkamal % Huhtamaki Ppl % Astral Poly Technik % Kirloskar Brothers % Media & Entertainment Sun TV Network % Non - Ferrous Metals Vedanta % Petroleum Products Reliance Industries % Castrol (India) % Pharmaceuticals Torrent Pharmaceuticals % Sun Pharmaceutical Industries % Aurobindo Pharma % Software Infosys % Textile Products Indian Terrain Fashions % Textiles - Cotton Indo Count Industries % Transportation Gateway Distriparks % Other Equity Investments % Cash Equivalents CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC Tax Saver Equity Fund Dividend 17-Mar Mar Mar HSBC Tax Saver Equity Fund Dividend Direct 17-Mar Mar Mar Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 09

12 HSBC Dynamic Fund (HDF) An Open Ended Scheme Investment Objective: To provide long term capital appreciation by allocating funds in equity and equity related instruments. It also has the flexibility to move, entirely if required, into debt instruments in times that the view on equity markets seems negative. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Managers 24-Sep-07 S&P BSE 200 ` , Neelotpal Sahai (for Equity portion) Sanjay Shah (for Fixed Income portion) FUND PORTFOLIO Issuer Auto Banks Market Value (` in Lacs) % to Net Assets Maruti Suzuki India % Tata Motors % Hero Motocorp % HDFC Bank % SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** Available `10,000 `1,000 p.m.(sip) Nil 3.56% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.68% Direct Plan 1.98% Excludes GST on Investment Management fees of 0.30% of Total Net Assets. Portfolio Turnover 0.90 Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Auto 10.88% Banks 27.57% Construction Project 5.05% Consumer Non Durables 9.71% Ferrous Metals 3.00% Finance 7.95% Non - Ferrous Metals 3.55% Petroleum Products 7.52% Pharmaceuticals 2.74% Power 5.98% Software 9.33% Telecom - Services 2.50% Reverse Repos/CBLOs 2.07% Net Current Assets 2.15% HSBC Dynamic Fund (HDF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in equity and equity related securities and in debt instruments when view on equity markets is negative LOW Riskometer Moderate Investors understand that their principal will be at risk HIGH ICICI Bank % Kotak Mahindra Bank % Yes Bank % Indusind Bank % Construction Project Larsen & Toubro % Consumer Non Durables ITC % Asian Paints % Ferrous Metals Tata Steel % Finance HDFC % Non - Ferrous Metals Vedanta % Petroleum Products Reliance Industries % Pharmaceuticals Aurobindo Pharma % Power Power Grid Corporation Of India % NTPC % Software Infosys % HCL Technologies % Telecom - Services Idea Cellular % Cash Equivalents CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 10

13 HSBC Emerging Markets Fund (HEMF) An Open Ended Scheme Investment Objective: To provide long term capital appreciation by investing in India and in the emerging markets, in equity and equity related instruments, share classes and units/securities issued by overseas mutual funds or unit trusts. The fund may also invest a limited proportion in domestic debt and money market instruments. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager 17-Mar-08 MSCI Emerging Markets Index ` Ranjithgopal K A (Dedicated fund manager for overseas investments) FUND PORTFOLIO Issuer Overseas Mutual Fund HSBC Gif Glob Emerg Mkts Eq S1 Dis % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul % SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** Available `10,000 `1,000 p.m.(sip) Nil 4.24% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.69% Direct Plan 1.99% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.07% of Total Net Assets. Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV (`) per unit (cum dividend) HSBC - Emerging Market Fund - Dividend 27-Jun HSBC - Emerging Market Fund - Dividend - Direct Plan 27-Jun Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Overseas Mutual Fund 99.36% Reverse Repos/CBLOs 1.61% Net Current Assets -0.97% HSBC Emerging Markets Fund (HEMF) This product is suitable for investors who are seeking*: To create wealth over long term Investment in equity and equity related securities of Emerging economies LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH 11

14 HSBC Asia Pacific (Ex Japan)Dividend Yield Fund (HAPDF) An Open Ended Fund of Funds Scheme Investment Objective: The primary investment objective of the Scheme is to provide long term capital appreciation by investing predominantly in units of HSBC Global Investment Funds (HGIF) Asia Pacific Ex Japan Equity Dividend Fund (HEHDF). The Scheme may also invest a certain proportion of its corpus in money market instruments and / or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time. However, there is no assurance that the investment objective of the Scheme will be achieved. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 24-Feb-14 MSCI AC Asia Pacific ex Japan ` Ranjithgopal K A (for overseas investments), Sanjay Shah (for investments in Indian Market) Available `10,000 `1,000 p.m.(sip) Nil 3.55% FUND PORTFOLIO Issuer Overseas Mutual Fund HSBC Gif Asia Pacific Ex Japan Eq HD-S9D % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul % Weighted Average Monthly Total Expenses ratios (Annualized) Regular 1.99% Direct Plan 1.29% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.05% of Total Net Assets. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Overseas Mutual Fund 96.27% Reverse Repos/CBLOs 3.25% Net Current Assets 0.48% HSBC Asia Pacific (Ex Japan)Dividend Yield Fund (HAPDF) This product is suitable for investors who are seeking*: To create wealth over long term Investment in equity and equity related securities of Asia Pacific countries (excluding Japan) through fund of funds route LOW Riskometer Moderate Investors understand that their principal will be at risk HIGH * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 12

15 HSBC Brazil Fund (HBF) An Open-Ended Fund of Funds Scheme Investment Objective: The primary investment objective of the Scheme is to provide long term capital appreciation by investing predominantly in units/shares of HSBC Global Investment Funds (HGIF) Brazil Equity Fund. The Scheme may, at the discretion of the Investment Manager, also invest in the units of other similar overseas mutual fund schemes, which may constitute a significant part of its corpus. The Scheme may also invest a certain proportion of its corpus in money market instruments and/or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 06-May-11 MSCI Brazil 10/40 Index ` , Ranjithgopal K A (Dedicated fund manager for overseas investments) Available `10,000 `1,000 p.m.(sip) Nil 10.78% FUND PORTFOLIO Issuer Overseas Mutual Fund HSBC Gif Brazil Equity S3D 2, % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.68% Direct Plan 1.98% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.17% of Total Net Assets. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Overseas Mutual Fund % Reverse Repos/CBLOs 1.02% Net Current Assets -1.26% HSBC Brazil Fund (HBF) This product is suitable for investors who are seeking*: To create wealth over long term Invests in equity and equity related securities through feeder route in Brazilian markets LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH 13

16 HSBC Managed Solutions India - Growth (HMSG) An Open Ended Fund of Funds Scheme Investment Objective: The objective of the Plan is to provide long term total return primarily by seeking capital appreciation through an active asset allocation with diversification commensurate with the risk profile of investments by investing predominantly in units of equity mutual funds as well as in a basket of debt mutual funds gold exchange traded funds (ETFs) and other ETFs, offshore mutual funds and money market instruments. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Managers SIP Minimum Application Exit Load 30-Apr-14 Composite Index constituting 80% of S&P BSE 200 Index and 20% of CRISIL Composite Bond Index ` , Ranjithgopal K A (Dedicated Fund Manager for investments in foreign securities) Gautam Bhupal (For managing investments in Indian Market Equity Portion) Sanjay Shah (For managing investments in Indian Market Fixed Income Portion) Available `5,000 `1,000 p.m.(sip) Nil FUND PORTFOLIO Issuer Mutual Fund HSBC Equity Fund - Growth Direct 9, % HSBC Midcap Equity Fund - Growth Direct 2, % HSBC Income Fund Short Term - Growth Direct 1, % HSBC Income Fund Inv Plan Growth Direct % HSBC Flexi Debt Fund Growth Direct % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 3.32% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.23% Direct Plan 1.96% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.00% of Total Net Assets and of 0.19% on the underlying scheme's in which the fund of fund invests. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Mutual Fund 99.03% Reverse Repos/CBLOs 0.80% Net Current Assets 0.17% HSBC Managed Solutions India - Growth This product is suitable for investors who are seeking*: To create wealth over long term Investing predominantly in units of equity mutual funds as well as in a basket of debt mutual funds, gold & exchange traded funds, offshore mutual funds and money market instruments. LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH 14

17 HSBC Managed Solutions India - Moderate (HMSM) An Open Ended Fund of Funds Scheme Investment Objective: The objective of the fund is to provide long term total return aimed at capital appreciation and providing income through an active asset allocation with diversification commensurate with the risk profile of investments by investing in a basket of debt mutual funds, equity mutual funds, gold ETFs and other ETFs, offshore mutual funds and money market instruments. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Managers SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 30-Apr-14 CRISIL Balanced Fund Aggressive Index ` , Ranjithgopal K A (Dedicated Fund Manager for investments in foreign securities) Gautam Bhupal (For managing investments in Indian Market Equity Portion) Sanjay Shah (For managing investments in Indian Market Fixed Income Portion) Available `5,000 `1,000 p.m.(sip) Nil 2.65% FUND PORTFOLIO Issuer Mutual Fund HSBC Equity Fund - Growth Direct 11, % HSBC Income Fund Short Term - Growth Direct 4, % HSBC Midcap Equity Fund - Growth Direct 3, % HSBC Flexi Debt Fund Growth Direct 3, % HSBC Income Fund Inv Plan Growth Direct 1, % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.11% Direct Plan 1.86% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.00% of Total Net Assets and of 0.17% on the underlying scheme's in which the fund of fund invests. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Mutual Fund 98.92% Reverse Repos/CBLOs 1.94% Net Current Assets -0.86% HSBC Managed Solutions India - Moderate This product is suitable for investors who are seeking*: To create wealth and provide income over the long term Investments in a basket of debt mutual funds, equity mutual funds, gold & exchange traded funds, offshore mutual funds and money market instruments. LOW Riskometer Moderate Investors understand that their principal will be at risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH 15

18 HSBC Managed Solutions India - Conservative (HMSC) An Open Ended Fund of Funds Scheme Investment Objective: The objective of the Plan is to provide long term total return aimed at providing income through an active asset allocation with diversification commensurate with the risk profile of investments by predominantly investing in units of debt mutual funds as well as in a basket of equity mutual funds, gold ETFs and other ETFs and money market instruments. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Managers SIP Minimum Application Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 30-Apr-14 Composite Index constituting of 90% into CRISIL Composite Bond Index and 10% of S&P BSE 200 Index ` , Ranjithgopal K A (Dedicated Fund Manager for investments in foreign securities) Gautam Bhupal (For managing investments in Indian Market Equity Portion) Sanjay Shah (For managing investments in Indian Market Fixed Income Portion) Available `5,000 `1,000 p.m.(sip) Ni 0.92% FUND PORTFOLIO Issuer Mutual Fund HSBC Income Fund Short Term - Growth Direct 15, % HSBC Flexi Debt Fund Growth Direct 7, % L&T Triple Ace Bond Fund Direct Growth 4, % HSBC Equity Fund - Growth Direct 3, % HSBC Income Fund Inv Plan Growth Direct 1, % HDFC Income Fund Direct Plan - Growth 1, % IDFC Dynamic Bond Fund-Direct Pl-Growth 1, % Cash Equivalents Market Value (` in Lacs) % to Net Assets CBLO % Net Current Assets % Total Net Assets as on 31-Jul , % Weighted Average Monthly Total Expenses ratios (Annualized) Regular 1.62% Direct Plan 1.37% (inclusive of underlying scheme's expenses) Excludes GST on Investment Management fees of 0.04% of Total Net Assets and of 0.09% on the underlying scheme's in which the fund of fund invests. Statistical ratios disclosed as per monthly returns (absolute) for the last 3 years. **Risk free rate: 6.25% (FIMMDA-NSE Mibor) as on July 31, 2017) Asset Allocation Mutual Fund 99.00% Reverse Repos/CBLOs 1.59% Net Current Assets -0.59% HSBC Managed Solutions India - Conservative This product is suitable for investors who are seeking*: To create wealth over long term Investing predominantly in units of debt mutual funds as well as in a basket of equity mutual funds, gold & other exchange traded funds and money market instruments. LOW Riskometer Moderate Investors understand that their principal will be at Moderate risk * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. HIGH 16