Good year for the fund despite volatile market scenario

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2 Good year for the fund despite volatile market scenario The fund completed 1 year recently 12, , , , , , Axis Multicap Fund - Reg - Growth Nifty 500 Index NAV/Index Movement (Rebased to Rs.10,000) 9, Nov-17 Feb-18 May-18 Aug-18 Nov-18 Fund Name CAGR (%) 1 Year Since Inception Current Value of Investment of Rs. 10,000/- CAGR (%) Current Value of Investment of Rs. 10,000/- Axis Multicap Fund (Regular Plan) - Growth 8.11% 10, % 10,800 Nifty 500 (Benchmark) 0.74% 10, % 10,066 Nifty 50 (Additional Benchmark) 7.82% 10, % 10,707 Past performance may or may not be sustained in future. Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs. 10/- invested at inception. Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. Shreyash Devalkar is managing Axis Bluechip Fund and Axis Midcap Fund since 23rd November 2016 and Axis Equity Advantage Fund - Series 1 & 2 & Axis Multicap Fund since inception; He is managing 5 schemes. Data as on 30 th Nov Performance in SEBI prescribed format & performance of other schemes managed by the fund manager are on page

3 Outperformed the benchmark with lower risk than benchmark Sailed through the ups and downs of the market NAV/Index Movement 12,000 11,500 Axis Multicap Fund - Reg - Growth Nifty 500 Index Risk parameter Since inception (17 th Nov 2017) 11,000 10,500 Std Deviation (Fund) 10.7% Std Deviation (Benchmark) 12.9% 10,000 9,500 9,000 Nov-17 Feb-18 May-18 Aug-18 Nov-18 Tracking Error 5.8% Beta 0.74 Past performance may or may not be sustained in future. Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs. 10/- invested at inception. Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. Shreyash Devalkar is managing Axis Bluechip Fund and Axis Midcap Fund since 23rd November 2016 and Axis Equity Advantage Fund - Series 1 & 2 & Axis Multicap Fund since inception; He is managing 5 schemes. Data as on 30 th Nov Performance in SEBI prescribed format & performance of other schemes managed by the fund manager are on page

4 Maintained a diversified portfolio while being benchmark agnostic 100% Market cap split Top Sector OW/UW 90% Market cap bucket % of NAV Consumer 6% 80% 70% 60% Large Cap 72% Finance Infrastructure & Power -3% 5% 50% 40% Mid Cap 4% Information Technology -4% 30% Metal,Metal Products & Mining -4% 20% Small Cap 2% 10% Healthcare Services -4% 0% Nov-17 Feb-18 May-18 Aug-18 Nov-18 Debt/Cash 22% Oil & Gas-8% LARGE CAP(%) MID CAP(%) SMALL CAP(%) Stock(s) / Issuer(s) / Sector(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. Note: Current Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). 4

5 Multicaps offer attractive opportunity for long term Risk return tradeoff is likely to be favorable in a multi-cap strategy Good ideas can do better irrespective of its sector/theme/size Bottom-up stock selection is key for building credible portfolio Multi-cap strategy has access to entire market spectrum and opportunities to focus on fast growing sectors 5

6 Investment Approach Axis Philosophy Fund Strategy QUALITY High conviction ideas with improved risk- adjusted return characteristics INFLECTION POINT Aims to look for stocks that are at inflection point GROWTH Look for stocks that are expected to report the faster growth relative to the benchmark DIVERSIFIED PORTFOLIO Invests across market cap spectrum (Typically % in large cap & 0-50% in mid & small cap)* Note: Current Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. 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. * As per internal investment policy and subject to change at the discretion of the fund manager. 6

7 Inflection point: Anchors for company selection Investment thesis Inflection point thesis Conviction Identifies company with: Sustainable earnings growth potential Credible management Acceptable liquidity Helps to determine Why act now? It looks at: Market Share Gain due to Competitive Advantage Industry Consolidation Sunrise Industry Improved management focus & Capital Allocation Regulatory & Policy Changes Portfolio Characteristics Active Idea Generation Bottom up stock picking Benchmark/Sector Agnostic All cap focus 7

8 Inflection Points Market Share Gain due to Competitive Advantage Industry Consolidation Sunrise Industry Improved management focus & Capital Allocation Regulatory & Policy Changes Pvt Sector Banks, Textiles Global Auto Ancillaries, Cement, Telecom, Airlines E-Commerce, Retailing, Fin-tech Stock specific Real Estate, Global Chemicals, Oil marketing companies Stock(s) / Issuer(s) / Sector(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). 8

9 Inflection point: Market Share Gain due to Competitive Advantage Illustration: Stock A Sector: Finance A leading provider of Housing Finance in India with a network of 326 offices catering to over 2,400 towns & cities spread across the country. Amid rising interest rates and liquidity tightening, housing finance companies (HFCs) could face pressure on margins. However, this company is expected to wade out of the current tightness given its competitive edge over its peers backed by strong growth in business, flexible borrowing profile, stable margin and well-managed asset quality. Further, it being a market leader in retail lending space, has successful sailed through sector headwinds in the past. % p.a. Price growth (5 years) 19% Net worth growth (FY19E) 53% ROE (FY 19E) 16% Nov-13 Nov-14 Nov-15 Nov-16 Nov-17 Nov-18 Stock A Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

10 Inflection point: Market Share Gain due to Competitive Advantage Illustration: Stock B Sector: Finance One of India's leading banking and financial services groups, offering a wide range of financial services. The bank has done well in growing its Casa deposits, which along with balanced loan growth ambitions has helped to improve the Casa ratio to 50% of deposits (+40% of liabilities) higher than peers in the emerging private banks space. A stronger deposit franchise and capital position should provide opportunities to boost growth through market-share gains from PSUs/NBFCs. % p.a. Price growth (5 years) 27% Net worth growth (FY19E) 14% ROE (FY 19E) 14% Nov-13 Nov-14 Nov-15 Nov-16 Nov-17 Nov-18 Stock B Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

11 Inflection point: Industry Consolidation Illustration: Stock C Sector: Consumer India s leading watch manufacturer and retailer. Gradually, jewellery, precision engineering, eyewear, accessories, and licensed products were added to the watches portfolio. Jewellery business now contributes ~80% to sales with one of their jwellery brands being the largest and most reputed jeweller in the organized space. The company has the ability to create significant value with its large distribution presence, strong brand, designing skills and proven execution track record. % p.a. Price growth (5 years) 32% PAT Growth (FY19E) 30% ROE (FY19E) 16% Nov-13 Nov-14 Nov-15 Nov-16 Nov-17 Nov-18 Stock C Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

12 Inflection point: Sunrise Industry Illustration: Stock D Sector: Finance The only Micro Finance Institution to receive universal banking licence in The bank has a unique business model of high yielding micro finance loan and low cost deposit franchise with 36.9% CASA offered in the ambit of a commercial bank. This enables it to garner highest margin among peers at ~9-10%. Robust growth, better than banking margins and low cost to income continue to remain strong attributes of the bank. % p.a. Price growth (Since Inception) 29% PAT growth (FY19E) 45% ROE (FY19E) 19% Mar-18 May-18 Jul-18 Sep-18 Nov-18 Stock D Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

13 Inflection point: Improved management Illustration: Stock E Sector: Finance India s second largest bank and the largest among private banks in terms of total assets. Further, the Bank has a large footprint of 4,867 domestic branches and 14,417 ATMs spread across the country. Private banks are best placed to gain market share from potential consolidation among NBFCs, given their stronger Casa and capital ratios. The management shifts have de-centralised decision-making, enjoying higher retail-segment shares Earnings are expected to improve remarkably given stable improvement in NIM with improving share of superior-yield retail lending and increasing granularity in deposit franchise. % p.a. Price growth (5 years) 13% Net worth growth (FY19E) 29% PAT growth (FY19E) 26% Nov-13 Nov-14 Nov-15 Nov-16 Nov-17 Nov-18 Stock E Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

14 Inflection point: Regulatory Policy change Illustration: Stock F Sector: Finance One of the largest Asset Management Companies (AMC) in India. The company has been a leader in the Indian mutual fund industry in terms of profitability, equity oriented AUM size and total average AUM. Through organic growth and couple of acquisitions, the company has grown to one of the top 2 AMCs in the country. The recent cut on the maximum permissible limits for expense ratios charged to mutual fund investors affected the larger AMCs. However, the company continues to have robust return on capital and growth prospects. % p.a. Price growth (Since Inception) 38% PAT growth (FY19E) 22% ROE (FY19E) 39% Aug-18 Sep-18 Oct-18 Nov-18 Stock F Nifty 50 Index Source: Bloomberg. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). Data as on 30 th Nov

15 Current portfolio & risk parameter (30 th Nov 2018) Top holdings Top Sectors Top 10 stocks % of NAV H D F C Bank Limited 10% Bajaj Finance Limited 8% Kotak Mahindra Bank Limited 8% Maruti Suzuki India Limited 6% Tata Consultancy Services Limited 5% I C I C I Bank Limited 4% Avenue Supermarts Limited 4% Hindustan Unilever Limited 3% Housing Development Finance Corpn. 3% Pidilite Industries Limited 3% Sector % of NAV Finance 37% Consumer 20% Information Technology 7% Autos & Logistics 7% Capital Goods, Engineering & Construction 3% Current Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of disclosure of the portfolio of the Scheme(s) and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). 15

16 Features at glance Scheme Name Axis Multicap Fund Type An Open-ended Equity Scheme investing across large cap, mid cap, small cap stocks Benchmark NIFTY 500 Index Fund Manager Shreyash Devalkar Minimum Investment Rs. 5,000 and in multiples of Re. 1/- thereafter Plans : Regular/ Direct Options : Growth, Dividend Facility : Payout/Reinvestment 16

17 Annexure 30 th @ Past performance may or may not be sustained in future. Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs. 10/- invested at inception. Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. Above data excludes returns of schemes which have not completed a year. Shreyash Devalkar is managing Axis Bluechip Fund and Axis Midcap Fund since 23rd November 2016 and Axis Equity Advantage Fund - Series 1 & 2 & Axis Multicap Fund since performance data for 5 years period has not been provided for scheme/plan not in existence for 5 performance data for 3 years period has not been provided for scheme/plan not in existence for 3 years 17

18 Annexure 30 th @ Past performance may or may not be sustained in future. Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs. 10/- invested at inception. Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. Above data excludes returns of schemes which have not completed a year. Shreyash Devalkar is managing Axis Bluechip Fund and Axis Midcap Fund since 23rd November 2016 and Axis Equity Advantage Fund - Series 1 & 2 & Axis Multicap Fund since performance data for 5 years period has not been provided for scheme/plan not in existence for 5 performance data for 3 years period has not been provided for scheme/plan not in existence for 3 years 18

19 Product Labelling Fund Name Riskometer Product Labelling Axis Bluechip Fund (An open ended equity scheme predominantly investing in large cap stocks) Axis Multicap Fund (An open ended equity scheme investing across large cap, mid cap, small cap stocks) Axis Midcap Fund (An open ended equity scheme predominantly investing in Mid Cap stocks) Axis Equity Advantage Fund Sr 1 & 2 (A Close Ended Equity Scheme) Axis Mutual Fund This product is suitable for investors who are seeking* Capital appreciation over long term Investment in a diversified portfolio predominantly consisting of equity and equity related instruments of large cap companies This product is suitable for investors who are seeking* Capital appreciation over medium to long term Investment in a diversified portfolio consisting of equity and equity related instruments across market capitalization. This product is suitable for investors who are seeking* Capital appreciation over long term Investing predominantly in equity & equity related instruments of Mid Cap companies. This product is suitable for investors who are seeking* Capital appreciation over medium to long term Investment in a diversified portfolio of predominantly equity and equity related instruments across market cap while managing risk through active hedging strategies 19

20 Riskometer, Statutory Details and Risk Factors This product is suitable for investors who are seeking*: capital appreciation over medium to long term investment in a diversified portfolio consisting of equity and equity related instruments across market capitalization. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. Data updated as on 30 th Nov Disclaimer: Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of disclosure of the portfolio of the Scheme(s) and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time to time. Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC). Risk Factors: Axis Bank Limited is not liable or responsible for any loss or shortfall resulting from the operation of the scheme. This document represents the views of Axis Asset Management Co. Ltd. and must not be taken as the basis for an investment decision. Neither Axis Mutual Fund, Axis Mutual Fund Trustee Limited nor Axis Asset Management Company Limited, its Directors or associates shall be liable for any damages including lost revenue or lost profits that may arise from the use of the information contained herein. No representation or warranty is made as to the accuracy, completeness or fairness of the information and opinions contained herein. The AMC reserves the right to make modifications and alterations to this statement as may be required from time to time. Scheme specific risk factors: Apart from the risks associated with domestic investments, the scheme may invest in overseas markets which carry risks related to fluctuations in the foreign exchange rates, the nature of the securities market of the country, repatriation of capital due to exchange controls and political circumstances. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s). The material should not be construed as issued by Government of India or any of its authority. Mutual Fund Investments are subject to market risks, read all scheme related documents carefully. 20

21 Thank you