The Asset Factsheet - April 2018

Transcription

1 The Asset Factsheet - April 2018

2 Index Fund Manager Commentary HSBC Mutual Fund Products HSBC Large Cap Equity Fund HSBC Multi Cap Equity Fund HSBC Small Cap Equity Fund HSBC Infrastructure Equity Fund HSBC Tax Saver Equity Fund HSBC Dynamic Asset Allocation Fund HSBC Global 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 Regular Savings Fund HSBC Debt Fund HSBC Short Duration Fund HSBC Cash Fund HSBC Duration Fund HSBC Flexi Debt Fund Fund Managers - Debt Fund Manager Wise Comparative Performance of Debt Schemes Section II - How to read Factsheet

3 Fund Manager Commentary Equities staged a bounce back in April After experiencing weak momentum through the first quarter of 2018, the equity markets bounced back to register a strong performance in the month of April. Global newsflows improved on the back of receding concerns on trade tensions between the US and China as well as an improving geopolitical environment in the Korean peninsula. Domestically, the revert to positive performance during the month was driven by more bottom up sectoral factors even as some of the macro variables remained under pressure as reflected in the bond yields and in the weakening trends of currency. The forecast for a third successive normal monsoon rainfall lifted the sentiments of consumer staples and rural focused companies. The IT sector did well on the back of INR depreciation and a good set of quarterly results from the sector leader. Healthcare sector also saw traction on the aspect of currency depreciation improving earnings going forward. Industrials continued to do well on the back of the government s focus on infrastructure spends. The market indices BSE Sensex and CNX Nifty rose by 6.6% and 6.2% respectively. BSE Midcap index performance was inline with that of the market indices at 6.6%, while BSE Smallcap index delivered an outperformance gaining 8.3% during the month (returns on Total Return or TR variants of indices). Returns % 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% Indices Performance - Apr 2018* - Sensex Nifty BSE200 BSE500 BSE MidCap BSE SmallCap Source: Bloomberg; Bombay Stock Exchange (BSE) *returns on Total Return or TR variants of indices The official weather agency, India Meteorological Department (IMD) has forecasted a normal monsoon this southwest monsoon season with the rainfall expected to come in at 97% of the Long Period Average (LPA) with an error range of +/-5%. Additionally, the IMD sees a 42% of a near normal rainfall scenario. This augurs well in the context of rural consumption theme. As per a government release, the GST revenues for April 2018 has crossed the much awaited threshold of Rs. 1 trillion mark with the collections for the month recording Rs trillion. This trend is positive as the GST collections had been in the range of Rs trillion range in the past few months. However, more clarity on the collections data may be required to conclude that we are indeed witnessing a like to like acceleration in the GST figures. On the quarterly results front, the first leg of the earnings season has been stable so far. For IT sector, the result trends have been good driven by the sector leader TCS, while in financials the trends have remained mixed. Retail focused banks and names with lesser asset quality issues delivered good results while corporate banks with higher stressed assets saw slippages and related provisioning costs impacting profits for the quarter. Mid cap names / NBFCs within financials have witnessed a relatively good quarterly earnings season so far. Telecommunication names had a very weak fourth quarter on expected lines owing to high competitive pressures but fared marginally better on lowered expectations. INR depreciated by about 2.3% during April (versus the USD). Global crude prices rose by 7% during the month to close at USD 75 / barrel and this may act as a macro headwind in the interim given that India is a net importer of the commodity. er crude price environment can also add to the risk of uptick in inflation as well. The 10 year benchmark bond yield saw another round of hardening and rose by 37 bps month on month. Macro data releases during the month showed mixed trends. CPI inflation even though eased marginally for the third month in a row, an uptick in core inflation was visible. The industrial growth data moderated but remained buoyant recording 7.1% YoY, for the month of February. March trade deficit data saw a widening of the deficit from the previous month, as exports contracted marginally on a YoY basis during the month. External Institutional Fund Flows Foreign Institutional Investor (FII) segment turned net sellers and saw net outflows to the tune of about USD 940 mn during the month and this compares to about USD 2.02 bn of net inflows seen in the previous month. For the first four months of 2018, FIIs have net bought Indian equities worth about USD 1.18 bn (about USD 7.71 bn of net inflows in CY2017). The Domestic Institutional Investor (DII) segment* continued to see good net inflows (about USD 1.29 bn) driven by net inflows from the domestic MFs. The MF segment net bought equities worth about USD 1.54 bn* for the month while the domestic insurers remained net sellers. On a CYTD perspective, the MF segment has seen net inflows of about USD 6.88 bn*, while at an overall DII level, the net inflows stood at about USD 5.15 bn, accounting for the net outflows from the domestic insurers. *Provisional Data Global Economic Scenario After adversely impacting market sentiments during March, the global news flows improved during the month. The concerns over global trade protectionism receded during the month after China s conciliatory remarks even as the US President expressed confidence that a resolution to the trade conflict is in sight. While there were concerns on a likely escalation in geopolitical tensions in Syria, the situation eased during the month itself. International oil prices continued to rise during the month on the back of continuing strength in global demand, expectations that OPEC and Russia will extend supply cuts, and geopolitical tensions in the Middle East. 01

4 Fund Manager Commentary Market View Equity Market Outlook Equity markets recorded a smart recovery in April, after remaining under pressure for the previous two months. Ease in global concerns and bottom up domestic factors contributed to the gains overall, even as the weakening of the currency and uptick in crude prices have raised some macro concerns. We believe that the earnings recovery cycle is well underway and FY19 could see a double digit earnings growth trajectory at the market indices, a welcome deviation from single digit earnings growth trajectory seen in the recent past. Having said that, there are some challenges in the form of elevated crude price environment as well as its resultant impact on inflation, to watch out for. If we see a sustained period of higher crude prices, then that will have adverse bearing on the country, being a net importer of the commodity. A likely spike in inflation on the back of higher oil prices, would also be negative in the context of a steady state interest rate environment. We are already seeing an uptick in the 10 year benchmark bond yields. In addition to these, we are also entering an election packed phase culminating to the general elections in April / May The Karnataka election outcome will be known by mid-may and market may take some cues from this verdict. Given the election calendar, there may be concerns on the extent of legislative actions that the government can undertake in the interim. The budget session of parliament has been a wash-out, owing to disruptions by opposition parties and on the policy front, we expect an incremental approach while bigger reforms may be missing from the agenda owing to the election calendar. On the positive front, the IMD forecast for a normal monsoon season will mean that this will be the third consecutive year of normal rainfall and is expected to boost rural consumption. GST revenues have started to see traction if we go with theapril figure that has exceeded Rs. 1 trillion a month, however a fine print will help us to analyse this data more. E-way bill implementation has just been initiated and a full scale implementation over the next one or two quarters is expected to boost GST collections. The factors to closely track would be the remainder of the 4QFY18 earnings season, Karnataka state elections (counting on 15 May), global crude price dynamics, rising trends of protectionism in the developed economies and the interest rate actions in the US. We remain constructive on the India story and for investors with a long term investment horizon, equity investments provide the potential to deliver relatively better returns vis-à-vis other alternatives and also can act as an avenue for long term wealth creation. Therefore, we continue to urge investors to approach equity investing from a long term perspective and always keep the asset allocation plan in mind, taking into account one s risk appetite and future goals in mind. RBI's Monetary Policy, Economic Indicators MPC minutes RBI released minutes of the April Monetary Policy Committee or MPC policy. The minutes were more hawkish than expected. Most members were optimistic on growth recovery even as they highlighted the upside risks to the inflation from crude price increases and MSP increase. Apart from Dr. Patra, who had voted for a rate hike, comments from Dr. ViralAcharya were also hawkish, with the latter indicating that he could shift his vote towards a change in stance to withdrawal of accommodation from neutral in the next policy. He had also highlighted the increase in core inflation over the past few months. Other members views were broadly on expected lines with Dr. Chetan Ghate also highlighting potential risk from higher levels of fiscal and current account deficits. Changes to FPI regulations RBI at the end of April announced certain changes to regulations for FPIs or Foreign portfolio investors. FPIs are now allowed to invest in corporate bonds of residual maturity of over 1 year, as compared to 3 years permitted earlier. For government securities, restriction on residual maturity has been removed. However, at all points of time, FPIs are required to ensure that no more than 20% of the investments in that category (G- Sec/Corporate bonds) are in securities with residual maturity of less than 1 year. If FPIs have more than 20% of investments in securities with residual maturity of less than 1year as on the date of the circular, they will have a six month period to ensure that the same is brought below 20%. Additionally for corporate bonds, there is a restriction on holding 50% of a single issue and further an issuer limit of 20% of overall holdings of the FPI in Indian corporate bonds (including related entities of the issuer), which has to be ensured at all points of time. GST GST collections for the month of March 2018 (collected in April 2018) was reported at INR 1001 bn, which was higher as compared to Rs.850 bn in February However these collections are for 30 days in April as compared to upto 20th of each month till March. Furthermore, on a seasonal basis March generally tends to see higher collections of indirect taxes owing to relatively higher activity as well as payment of arrears and dues. Inflation Consumer Price Index or CPI CPI inflation for the month of Mar-2018 was 4.3% from 4.4% in Feb 2018, which was however higher than market expectations of around 4%.This was driven mainly by a decrease in food inflation to 3.34% in February v/s 4.61 % in January. This is driven by a sharp sequential fall in vegetable prices. The headline moderation was due to lower food prices however, core inflation was stubborn at higher levels picking up to 5.3% from the previous print of 5.1%. Inflation Growth (%) 7% 6% 5% 4% 3% 2% 1% 0 CPI Inflation (%) Feb-15 Jun-15 Oct-15 Feb-16 Jun-16 Oct-16 Mar-17 Jul-17 Oct-17 Mar-18 Source: Bloomberg; Central Statistical Organization (CSO) India 02

5 Fund Manager Commentary Index of Industrial Production or IIP February IIP growth moderated to 7.1% from the previous revised print of 7.4% in January. Capital goods and Infrastructure goods have contributed positively. Consumer durables growth sustained while consumer nondurables growth was on the lower side. 14% Index of Industrial Production (IIP) new series data Growth % 9% 4% -1% -6% Mar/13 Aug/13 Dec/13 May/14 Sep/14 Feb/15 Jun/15 Nov/15 Mar/16 Aug/16 Dec/16 May/17 Sep/17 Feb/18 Series1 Source: Bloomberg Trade deficit March trade deficit widened to INR 13.7 bn v/s 12 bn in February as import growth at 7.1% y-o-y outpaced exports, which de-grew by 0.6% y-o-y. Oil exports fell largely on the back of an unfavorable base. Items such as textiles, gems and jewelry, and electronic goods too contributed to the overall decline in exports. On the imports front, non-oil non-gold imports continued to grow strongly at over 12% inapril. Currency Rupee continued its weakness in April touching 67 levels briefly during the month before recovering to at the end of the month. Rising crude prices and weak trade deficit number contributed to the weaker sentiments. FPI flows were negative during the month with outflows of INR -136 bn in debt and INR -60 bn in equity. Markets In the initial part of the month, markets continued with the positive sentiments seen after the borrowing calendar announcement, which was further supported by RBI s policy statement which marked down the inflation projection to 4.7%-5.1% (v/s 5.1%-5.6%) in 1H FY19 and to 4.4% ( v/s 4.5%- 4.6%) in 2H FY19. However the MPC minutes which were released later in the month, indicated that most members views were more hawkish than indicated by the policy statement. The hawkish sounding MPC minutes as well as spike in crude prices resulted in the markets giving up the gains and 10 year reversed course to end the month higher at Liquidity Liquidity moved closer to neutral during the month after initially being in surplus with outstanding Liquidity Adjustment Facility or LAF amount ending the month at around Rs.187 bn. Going Forward Market is likely to trade in the range of in the near term. Trajectory of crude prices could determine further path going forward. Shorter end bonds might see some relief based on the recently announced changes in FPI regulations. 10% 9% Repo Rate (%) Rate % 8% 7% 6% 5% 4% May/10 Oct/10 Mar/11 Aug/11 Jan/12 Jun/12 Nov/12 Apr/13 Sep/13 Feb/14 Jul/14 Dec/14 May/15 Oct/15 Mar/16 Aug/16 Jan/17 Jun/17 Nov/17 Apr/18 Source: Bloomberg, for all data except where mentioned otherwise 03

6 Fund Manager Commentary Sectors HSBC Large Cap Equity Fund # HSBC Multi Cap Equity Fund # HSBC Small Cap Equity Fund Consumer Discretionary Consumer Staples Energy Financials Healthcare Industrials Information Technology Materials Telecommunication Utilities Overweight Underweight Neutral #The benchmark for HSBC Large Cap Equity Fund and HSBC Multi Cap Equity 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 Large Cap Equity Fund Positive Contributors Financials, Consumer Discretionary & Healthcare - certain stock (s) selection helped performance Energy being underweight & certain stock (s) selection helped performance Negative Contributors Consumer Staples - being underweight & certain stock (s) selection hurt performance Review: HSBC Multi Cap Equity Fund Positive Contributors Financials, Consumer Discretionary & Healthcare certain stock (s) selection helped performance Utilities being underweight helped performance Materials - being overweight & certain stock (s) selection helped performance Energy being underweight & certain stock (s) selection helped performance Negative Contributors Consumer Staples & Information Technology - being underweight & certain stock (s) selection hurt performance Industrials - certain stock (s) selection hurt performance Telecommunication - being overweight & certain stock (s) selection hurt performance Review: HSBC Small Cap Equity Fund Positive Contributors Consumer Staples - being overweight & certain stock (s) selection helped performance Telecommunication being underweight helped performance Industrials & Healthcare being underweight & certain stock (s) selection helped performance Financials & Materials certain stock (s) selection helped performance Negative Contributors Consumer Discretionary & Information Technology - being underweight & certain stock (s) selection hurt performance Energy - certain stock (s) selection hurt performance Review: HSBC Dynamic Asset Allocation Fund The cash levels and sector allocation in the fund are likely to change depending on the market conditions and technical factors Review: HSBC Regular Savings Fund Our current exposure is 25% in HSBC Regular Savings Fund. Currently it is more biased towards large caps than mid or small caps. 04

7 HSBC Mutual Fund Products Pursuant to the circular issued by Securities and Exchange Board of India(SEBI) on Categorization and Rationalization of Mutual Fund Schemes in order to bring uniformity in the practice and standardize the scheme categories across the Mutual Funds, placed below is the HSBC Mutual Fund s product spectrum, effective from 14th March,2018. Scheme Scheme HSBC Large Cap Equity Fund (Previous Name - HSBC Equity Fund) HSBC Small Cap Equity Fund (Previous Name - HSBC Midcap Equity Fund) HSBC Multi Cap Equity Fund (Previous Name - HSBC India Opportunities Fund) HSBC Tax Saver Equity Fund Type Large Cap Fund An open ended equity scheme predominantly investing in largecap stocks. Small Cap Fund - An open ended equity scheme predominantly investing in small cap stocks Multi Cap Fund - An open ended equity scheme investing across large cap, mid cap, small cap stocks An open ended equity linked saving scheme with a statutory lock-in of 3 years and tax benefit Equity Schemes Benchmark Category Large Cap Fund (Previous Category - Large cap equity scheme) Small Cap Fund (Previous Category - Mid-cap Equity Scheme) Multi cap Fund (Previous Category - Flexi-Cap Equity Scheme) Equity Linked Savings Scheme Nifty 50 S&P BSE 250 Small Cap Index (Previous Benchmark - S&P BSE Midcap Index) S&P BSE 200 S&P BSE 200 Benchmark HSBC Infrastructure Equity Fund An open ended equity scheme following Infrastructure theme. Thematic Fund (Previous Category - Equity Scheme) S&P BSE India Infrastructure Index HSBC Global Emerging Markets Fund (Previous Name - HSBC Emerging Markets Fund) An open ended fund of fund scheme investing in HSBC Global Investment Funds - Global Emerging Markets Equity Fund Fund of Funds (Overseas) (Previous Category - Fund of Funds) MSCI Emerging Markets Index HSBC Asia Pacific (Ex Japan) Dividend Yield Fund HSBC Brazil Fund An Open Ended Fund of Funds Scheme investing in HSBC Global Investments Fund - (HGIF) Asia Pacific Ex Japan Equity Dividend Fund An Open-Ended Fund of Funds Scheme investing in HSBC Global InvestmentsFund - (HGIF) Brazil Equity Fund Fund of Funds (Overseas) (Previous Category - Fund of Funds) Fund of Funds (Overseas) (Previous Category - Fund of Funds) MSCI AC Asia Pacific ex Japan MSCI Brazil 10/40 Index HSBC Global Consumer Opportunities Fund HSBC Debt Fund (Previous Name - HSBC Income Fund - Investment Plan) HSBC Short Duration Fund (Previous Name - HSBC Income Fund - Short Term Plan) An Open Ended Fund of Funds Schemeinvesting HSBC Global Investment Funds (HGIF) China Consumer Opportunities Fund An open ended Medium to Long Term Debt Scheme investing in instruments such that the ^^ Macaulay duration of the portfolio is between 4 years to 7 years. An open ended Short Term Debt Scheme ^^ investing in instruments such that the Macaulay duration of the portfolio is between 1 year to 3 years. Fund of Funds (Overseas) (Previous Category - Fund of Funds) Debt Schemes Medium to Long Duration Fund (Previous category - Income Scheme) Short Duration Fund (Previous category - Short Term Plan) MSCI AC World Index CRISIL Composite Bond Fund Index CRISIL Short Term Bond Fund Index HSBC Cash Fund An Open Ended Liquid Scheme Liquid Fund CRISIL Liquid Fund Index HSBC Duration Fund (Previous Name - HSBC Ultra Short Term Bond Fund) An open ended Duration Debt Scheme ^^ investing in instruments such that the Macaulay duration of the portfolio is between 6 months to 12 months. Duration Fund (Previous category - Debt Fund) ^ CRISIL Duration Debt Index (Previously named as CRISIL Ultra Short Term Debt Index) (Previous benchmark CRISIL Liquid Fund Index - 90%, CRISLIL Short Term Bond Fund Index HSBC Flexi Debt Fund HSBC Dynamic Asset Allocation Fund (Previous Name - HSBC Dynamic Fund) HSBC Regular Savings Fund (Previous Name - HSBC Monthly Income Plan ) # HSBC Managed Solutions India - Growth An open ended Dynamic Debt Scheme investing across duration An open ended Dynamic Asset Allocation Fund. An open ended Hybrid Scheme investing predominantly in debt instruments. An Open Ended Fund of Funds Scheme investing in a basket of equity, debt, Gold and other Exchange Traded Funds Dynamic Bond Fund (Previous category - An open - ended Debt Scheme) Hybrid Scheme Dynamic Asset Allocation (Previous Category - Dynamic Equity Scheme) Conservative Hybrid Fund (Previous category - Income Scheme) Other Schemes Fund of Funds (Overseas/Domestic) CRISIL Composite Bond Fund Index S&P BSE 200 CRISIL Hybrid Conservative Index ( renamed from existing MIP Blended Fund Index) Composite Index constituting 80% of S&P BSE 200 Index and 20% of CRISIL Composite Bond Index. ^ # HSBC Managed Solutions India - Moderate An Open Ended Fund of Funds Scheme investing in a basket of equity, debt, Gold and other Exchange Traded Funds Fund of Funds (Overseas/Domestic) ^ CRISIL Hybrid Aggressive Index (renamed from existing CRISIL Balanced Fund Aggressive Index) HSBC Managed Solutions India - Conservative An Open Ended Fund of Funds Scheme investing in a basket of equity, debt, Gold and other Exchange Traded Funds Fund of Funds (Overseas/Domestic) Composite Index constituting of 90% of CRISIL Composite Bond Index and 10% of S&P BSE 200 Index. ^Debt Allocation of 85% and 35% in respective indices represented by CRISIL Composite Bond Index. The equity component of the Index has been changed from Nifty 50 to S&P BSE and will be represented by Total Return variant of S&P BSE # Monthly income is not assured and is subject to the availability of distributable surplus. ^^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. Criteria for Large, Mid & Small companies - SEBI has demarcated the definitions of large cap, mid cap and small cap companies as given below. Large Cap: 1st -100th company in terms of full market capitalization, Mid Cap: 101st -250th company in terms of full market capitalization, Small Cap: 251st company onwards in terms of full market capitalization of large/mid/small cap companies Note - A list of stocks as per above criteria will be uploaded on AMFI website and updated every six months by AMFI. 05

8 HSBC Large Cap Equity Fund Large Cap Fund - An open ended equity scheme predominantly investing in large cap stocks. Investment Objective: To generate long-term capital growth from an actively managed portfolio of equity and equity related securities of predominantly large cap companies.however, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. FUND DETAILS Date of Allotment 10-Dec-02 $ Benchmark Nifty 50 NAV (Growth) per unit ` (as on ) Monthly Average AUM 67, (In Lakhs) Fund Manager Neelotpal Sahai SIP Available Minimum^^ `5,000 (Lumpsum) Application Amount `1,000 Exit Load In respect of each purchase /switch-in of Units, an Exit Load of 1% is payable if Units are redeemed / switched-out within 1 year from the date of allotment. No Exit Load will be charged if Units are redeemed/ switched - out after 1 year from the date of allotment. Statistical Ratios Standard Deviation 14.60% Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.38% Direct Plan 1.68% Excludes GST on Investment Management fees of 0.27% of Total NetAssets. Portfolio Turnover 0.85 Statistical Ratios disclosed are as per monthly returns (Annualized) 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 Effective from March 14, 2018 for prospective investments. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Asset Allocation Auto 8.16% AutoAncillaries 2.94% Banks 31.70% Cement 1.94% Construction Project 7.01% Consumer Non Durables 5.60% Ferrous Metals 2.55% Finance 9.57% Hotels, ResortsAnd Other RecreationalActivities 1.06% Non - Ferrous Metals 3.63% Oil 1.03% Petroleum Products 4.82% Pharmaceuticals 1.38% Power 1.85% Software 12.39% Telecom - Services 2.05% Other Equity Investments 0.73% Reverse Repos/CBLOs 1.37% Net CurrentAssets 0.22% Total NetAssets % HSBC Large Cap Equity Fund This product is suitable for investors who are seeking*: To create wealth over long term Investment in predominantly large cap equity and equity related securities 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. FUND PORTFOLIO Issuer Auto Maruti Suzuki India 3, % Mahindra & Mahindra 2, % Auto Ancillaries Motherson Sumi Systems 1, % MRF % Banks HDFC Bank 6, % Yes Bank 3, % ICICI Bank 3, % IndusInd Bank 2, % Kotak Mahindra Bank 2, % Axis Bank 2, % Cement Shree Cement 1, % Construction Project Larsen & Toubro 4, % Consumer Non Durables ITC 2, % Britannia Industries 1, % Ferrous Metals Tata Steel 1, % Finance HDFC 3, % Indiabulls Housing Finance 1, % Shriram Transport Finance Co % Hotels, Resorts And Other Recreational Activities Indian Hotels Co % Non - Ferrous Metals Vedanta 2, % Oil Oil & Natural Gas Corporation % Petroleum Products Reliance Industries 3, % Pharmaceuticals Aurobindo Pharma % Power NTPC 1, % Software Infosys 4, % HCL Technologies 2, % Tata Consultancy Services 1, % Telecom - Services Bharti Airtel 1, % Other Equity Investments % Cash Equivalents Market Value ( ` in Lacs) % to Net Assets Reverse Repos % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV ( `) per unit (cum dividend) HSBC Large Cap Equity Fund - Dividend 10-Nov Nov Dec HSBC Large Cap Equity Fund - Dividend - Direct Plan 10-Nov Nov Dec 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 Multi Cap Equity Fund Multi Cap Fund - An open ended equity scheme Investing across large cap, mid cap, small cap stocks. 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. However, there can be no assurance or guarantee that the investment objective of the scheme would 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 disclosed are as per monthly returns (Annualized) 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 14, 2018 for prospective investments. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Asset Allocation 24-Feb-04 S&P BSE 200 ` , Neelotpal Sahai Available `5,000 (Lumpsum) `1,000 p.m.(sip) In respect of each purchase /switch-in of Units, an Exit Load of 1% is payable if Units are redeemed / switched-out within 1 year from the date of allotment. No Exit Load will be charged if Units are redeemed/ switched - out after 1 year from the date of allotment. Statistical Ratios Standard Deviation 15.80% 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 0.20% of Total NetAssets. Portfolio Turnover 0.46 Auto 9.86% AutoAncillaries 1.19% Banks 23.40% Cement 2.14% Chemicals 2.16% Construction 3.05% Construction Project 4.36% Consumer Non Durables 3.07% Ferrous Metals 4.72% Finance 11.25% Hotels, ResortsAnd Other RecreationalActivities 1.84% Industrial Capital Goods 1.30% Industrial Products 1.83% Non - Ferrous Metals 3.48% Petroleum Products 3.75% Pharmaceuticals 1.50% Software 6.66% Textile Products 1.15% Other Equity Investments 11.43% Reverse Repos/CBLOs 2.55% Net CurrentAssets -0.69% HSBC Multi Cap Equity Fund 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 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 Auto Mahindra & Mahindra 1, % Tata Motors 1, % Eicher Motors 1, % Maruti Suzuki India 1, % Auto Ancillaries Balkrishna Industries % Banks HDFC Bank 6, % ICICI Bank 3, % Yes Bank 3, % Axis Bank 1, % Cement Dalmia Bharat 1, % Chemicals Balaji Amines % Vinati Organics % Construction Gayatri Projects 1, % Ahluwalia Contracts (India) % Construction Project Larsen & Toubro 2, % Consumer Non Durables ITC 1, % Ferrous Metals Tata Steel 1, % Jindal Steel & Power % Srikalahasthi Pipes % Finance Bharat Financial Inclusion 3, % Bajaj Finance 2, % Cholamandalam Investment & Fin Co % Hotels, Resorts And Other Recreational Activities Indian Hotels Co. 1, % Industrial Capital Goods Sanghvi Movers % Industrial Products Supreme Industries 1, % Non - Ferrous Metals Vedanta 2, % Petroleum Products Reliance Industries 2, % Pharmaceuticals Aurobindo Pharma % Software Infosys 2, % HCL Technologies 1, % Textile Products Arvind % Other Equity Investments 7, % Cash Equivalents Market Value ( ` in Lacs) % to Net Assets Reverse Repos 1, % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV ( `) per unit (cum dividend) HSBC Multi Cap Equity Fund - Dividend 10-Nov Mar Feb HSBC Multi Cap Equity Fund - Dividend Direct Plan 10-Nov Mar Feb 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 Small Cap Equity Fund Small Cap Fund - An open ended equity scheme predominantly investing in small cap stocks. Investment Objective: To generate long term capital growth from an actively managed portfolio of equity and equity related securities of predominantly small cap companies. However, it could move a portion of its assets towards fixed income securities if the fund manager becomes negative on the Indian equity markets. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. FUND DETAILS Date of Allotment 19-May-05 Benchmark S&P BSE 250 Small Cap Index NAV (Growth) per unit ` (as on ) Monthly Average AUM 66, (In Lakhs) Fund Manager Dhiraj Sachdev SIP Available Minimum^^ `5,000 (Lumpsum) Application `1,000 p.m.(sip) Exit Load In respect of each purchase /switch-in of Units, an Exit Load of 1% is payable if Units are redeemed / switched-out within 1 year from the date of allotment. No Exit Load will be charged if Units are redeemed/ switched - out after 1 year from the date of allotment. Statistical Ratios Standard Deviation 20.51% Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.39% Direct Plan 1.69% Excludes GST on Investment Management fees of 0.20% of Total NetAssets. Portfolio Turnover 0.33 Statistical Ratios disclosed are as per monthly returns (Annualized) for the last 3 Effective from March 14, 2018 for prospective investments. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Asset Allocation Auto 3.83% AutoAncillaries 2.97% Cement 3.43% Chemicals 12.88% Construction 4.40% Construction Project 1.30% Consumer Non Durables 8.39% Ferrous Metals 4.80% Finance 22.22% Industrial Capital Goods 3.17% Industrial Products 7.83% Media & Entertainment 2.68% Minerals/Mining 3.22% Oil 1.26% Petroleum Products 1.34% Pharmaceuticals 1.36% Power 1.64% Software 2.88% Textiles - Synthetic 1.13% Other Equity Investments 7.41% Reverse Repos/CBLOs 1.98% Net CurrentAssets -0.12% HSBC Small Cap Equity Fund This product is suitable for investors who are seeking*: To create wealth over long term Investment in predominantly small 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 2, % Auto Ancillaries Apollo Tyres 2, % Cement Deccan Cements 2, % Chemicals Balaji Amines 3, % Vinati Organics 2, % GOCL Corporation 1, % Navin Fluorine International 1, % Construction Indiabulls Real Estate 1, % IRB Infrastructure Developers % Ahluwalia Contracts (India) % Construction Project Kridhan Infra % Consumer Non Durables Kaveri Seed Company 2, % Apex Frozen Foods 1, % CCL Products (India) 1, % Ferrous Metals Srikalahasthi Pipes 2, % Jindal Steel & Power % Finance Indiabulls Housing Finance 2, % Manappuram Finance 2, % Dewan Housing Finance Corporation 2, % Cholamandalam Investment & Fin Co. 1, % Motilal Oswal Financial Services 1, % Muthoot Finance 1, % Reliance Capital 1, % JM Financial 1, % Industrial Capital Goods Sanghvi Movers 1, % Macpower CNC Machines % Industrial Products Graphite India 1, % Ramkrishna Forgings 1, % CMI 1, % Jain Irrigation Systems % Media & Entertainment Jagran Prakashan 1, % Minerals/Mining Gujarat Mineral Development Corporation 2, % Oil South West Pinnacle Exploration % Petroleum Products Hindustan Petroleum Corporation % Pharmaceuticals Aurobindo Pharma % Power Kalpataru Power Transmission 1, % Software Sonata Software 1, % Textiles - Synthetic Sarla Performance Fibers % Other Equity Investments 5, % Cash Equivalents Reverse Repos 1, % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV ( `) per unit (cum dividend) HSBC Small Cap Equity Fund - Dividend 19-Nov Nov Nov HSBC Small Cap 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. 08

11 HSBC Infrastructure Equity Fund An open ended equity scheme following Infrastructure theme 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. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. FUND DETAILS Date of Allotment 23-Feb-06 $ Benchmark S&P BSE India Infrastructure Index NAV (Growth) per unit ` (as on ) Monthly Average AUM 17, (In Lakhs) Fund Manager Dhiraj Sachdev SIP Available Minimum^^ `5,000 (Lumpsum) Application Amount `1,000 Exit Load In respect of each purchase /switchin of Units, an Exit Load of 1% is payable if Units are redeemed / switched-out within 1 year from the date of allotment. No Exit Load will be charged if Units are redeemed/ switched - out after 1 year from the date of allotment. Statistical Ratios 20.58% Standard Deviation Beta (Slope) Sharpe Ratio** Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.58% Direct Plan 1.88% Excludes GST on Investment Management fees of 0.30% of Total NetAssets. Portfolio Turnover 0.38 Statistical Ratios disclosed are as per monthly returns (Annualized) 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 Effective from March 14, 2018 for prospective investments. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Asset Allocation Banks 1.67% Cement 4.93% Chemicals 4.04% Construction 13.45% Construction Project 6.26% Ferrous Metals 13.06% Finance 1.68% Gas 1.73% Industrial Capital Goods 10.83% Industrial Products 13.00% Minerals/Mining 6.78% Oil 1.18% Petroleum Products 6.33% Power 4.71% Transportation 5.52% Other Equity Investments 2.49% Reverse Repos/CBLOs 2.96% Net CurrentAssets -0.62% HSBC Infrastructure Equity Fund 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 % Chemicals GOCL Corporation % Construction KNR Constructions % Ahluwalia Contracts (India) % Indiabulls Real Estate % IRB Infrastructure Developers % NBCC India % Construction Project Kridhan Infra % HG Infra Engineering % Larsen & Toubro % Ferrous Metals Srikalahasthi Pipes 1, % Jindal Saw % Jindal Steel & Power % Finance Rural Electrification Corporation % Gas Gujarat State Petronet % Industrial Capital Goods Sanghvi Movers % Voltamp Transformers % Macpower CNC Machines % Industrial Products CMI % KEI Industries % Graphite India % Schaeffler India % Minerals/Mining Gujarat Mineral Development Corporation 1, % Oil South West Pinnacle Exploration % Petroleum Products Indian Oil Corporation % Hindustan Petroleum Corporation % Power PTC India % KSK Energy Ventures % Reliance Infrastructure % Transportation Adani Ports & Special Economic Zone % AVG Logistics % Other Equity Investments % Cash Equivalents Market Value ( ` in Lacs) % to Net Assets Reverse Repos % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % 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. 09

12 HSBC Tax Saver Equity Fund An Open Ended Equity Linked Savings Scheme with a statutory lock - in of 3 years and tax benefit. 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. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. FUND DETAILS Date of Allotment Benchmark NAV (Growth) per unit (as on ) Monthly Average AUM (In Lakhs) Fund Manager SIP Minimum^^ Application Amount Exit Load Statistical Ratios Standard Deviation Beta (Slope) Sharpe Ratio** 05-Jan-07 S&P BSE 200 ` , Aditya Khemani Available `500 (Lumpsum & SIP) Nil 15.36% Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.39% Direct Plan 1.69% Excludes GST on Investment Management fees of 0.29% of Total NetAssets. Portfolio Turnover Asset Allocation 0.45 Statistical Ratios disclosed are as per monthly returns (Annualized) for the last 3 years. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Auto 7.74% AutoAncillaries 6.19% Banks 28.45% Cement 7.26% Chemicals 1.58% Construction 2.32% Construction Project 3.86% Consumer Durables 3.00% Consumer Non Durables 6.18% Finance 3.78% Hotels, ResortsAnd Other RecreationalActivities 1.87% Industrial Products 4.62% Non - Ferrous Metals 3.72% Petroleum Products 2.14% Pharmaceuticals 3.44% Software 3.78% Telecom - Services 1.86% Textile Products 1.50% Textiles - Cotton 1.33% Transportation 3.80% Other Equity Investments 1.04% Reverse Repos/CBLOs 0.87% Net CurrentAssets -0.33% HSBC Tax Saver Equity Fund 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 % Mahindra & Mahindra % Auto Ancillaries MRF % Exide Industries % Amara Raja Batteries % Banks HDFC Bank 1, % ICICI Bank 1, % IndusInd Bank 1, % Federal Bank % Axis Bank % Cement NCL Industries % OCL India % Chemicals Galaxy Surfactants % Construction Somany Ceramics % Construction Project Larsen & Toubro % Consumer Durables Crompton Greaves Consumer Electrical % Blue Star % Consumer Non Durables United Spirits % ITC % Heritage Foods % Finance Cholamandalam Investment & Fin Co % JM Financial % Hotels, Resorts And Other Recreational Activities Indian Hotels Co % Industrial Products Nilkamal % Finolex Cables % Non - Ferrous Metals Vedanta % Petroleum Products Reliance Industries % Pharmaceuticals Torrent Pharmaceuticals % Sun Pharmaceutical Industries % Software Infosys % Telecom - Services Bharti Airtel % Textile Products Indian Terrain Fashions % Textiles - Cotton Indo Count Industries % Transportation Adani Ports & Special Economic Zone % Interglobe Aviation % Other Equity Investments % Cash Equivalents Reverse Repos % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % Dividend Declaration Record Date / period of dividend declared Non-Institutional Institutional NAV ( `) per unit (cum dividend) HSBC Tax Saver Equity Fund Dividend 23-Mar Mar Jan HSBC Tax Saver Equity Fund Dividend Direct 23-Mar Mar Jan Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit. 10

13 HSBC Dynamic Asset Allocation Fund An open ended Dynamic Asset Allocation Fund. 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. However, there can be no assurance or guarantee that the investment objective of the scheme would be achieved. 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** 24-Sep-07 S&P BSE 200 ` , Neelotpal Sahai (for Equity portion) Sanjay Shah (for Fixed Income portion) Available `5,000 (Lumpsum) `1,000 p.m.(sip) In respect of each purchase /switch-in of Units, an Exit Load of 1% is payable if Units are redeemed / switched-out within 1 year from the date of allotment. No Exit Load will be charged if Units are redeemed/ switched - out after 1 year from the date of allotment % Weighted Average Monthly Total Expenses ratios (Annualized) Regular 2.67% Direct Plan 1.97% Excludes GST on Investment Management fees of 0.35% of Total NetAssets. Portfolio Turnover 0.73 Statistical Ratios disclosed are as per monthly returns (Annualized) for the last 3 Effective from March 14, 2018 for prospective investments. **Risk free rate: 6.00% (FIMMDA-NSE Mibor) as on Apr 27, 2018) ^^ w.e.f April 17, Portfolio Turnover Ratio is computed for the last 12 months. Asset Allocation Auto 8.43% Banks 28.39% Cement 2.65% Construction Project 5.32% Consumer Non Durables 9.57% Ferrous Metals 2.93% Finance 2.92% Hotels, ResortsAnd Other RecreationalActivities 2.15% Non - Ferrous Metals 3.33% Petroleum Products 8.40% Pharmaceuticals 2.87% Power 3.08% Software 9.96% Telecom - Services 1.56% Transportation 2.09% Reverse Repos/CBLOs 4.83% Net CurrentAssets 1.52% HSBC Dynamic Asset Allocation Fund 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 FUND PORTFOLIO Issuer Auto Market Value ( ` in Lacs) % to Net Assets Maruti Suzuki India % Mahindra & Mahindra % Banks HDFC Bank % ICICI Bank % Kotak Mahindra Bank % IndusInd Bank % Yes Bank % Cement Shree Cement % Construction Project Larsen & Toubro % Consumer Non Durables ITC % Britannia Industries % Ferrous Metals Tata Steel % Finance Indiabulls Housing Finance % Hotels, Resorts And Other Recreational Activities Indian Hotels Co % Non - Ferrous Metals Vedanta % Petroleum Products Reliance Industries % Pharmaceuticals Aurobindo Pharma % Power NTPC % Software Infosys % HCL Technologies % Telecom - Services Bharti Airtel % Transportation Adani Ports & Special Economic Zone % Cash Equivalents Reverse Repos % CBLO % Net Current Assets % Total Net Assets as on 30-Apr , % * Investors should consult their financial advisers if in doubt about whether the product is suitable for them. 11