December Franklin Templeton Investments Monthly Fact Sheet

Transcription

1 December 2014 Monthly Fact Sheet

2 Contents Market Update EQUITY Franklin India Bluechip Fund (FIBCF) Templeton India Growth Fund (TIGF) Franklin India Prima Plus (FIPP) Franklin India Prima Fund (FIPF) Franklin India Flexi Cap Fund (FIFCF) Franklin India High Growth Companies Fund (FIHGCF) Franklin Asian Equity Fund (FAEF) Franklin India Opportunities Fund (FIOF) Franklin Build India Fund (FBIF) Templeton India Equity Income Fund (TIEIF) Franklin India Taxshield (FIT) Franklin India Smaller Companies Fund (FISCF) Franklin India Index Fund - NSE Nifty Plan (FIIF) Franklin Infotech Fund (FIF) Franklin India Feeder - Franklin U.S. Opportunities Fund (FIF-FUSOF) (Fund name change w.e.f. 30 June 2014, Erstwhile FT India Feeder - Franklin U.S. Opportunities Fund) Franklin India Feeder - Franklin European Growth Fund (FIF-FEGF) HYBRID Franklin India Dynamic PE Ratio Fund of Funds (FIDPEF) (Fund name change w.e.f. 30 June 2014, Erstwhile FT India Dynamic PE Ratio Fund of Funds ) Franklin India Multi Asset Solution Fund (FIMAS) Franklin India Life Stage Fund of Funds (FILSF) (Fund name change w.e.f. 30 June 2014, Erstwhile FT India Life Stage Fund of Funds) Franklin India Balanced Fund (FIBF) (Fund name change w.e.f. 30 June 2014, Erstwhile FT India Balanced Fund ) Franklin India Pension Plan (FIPEP) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Pension Plan) INCOME & LIQUID Franklin India Monthly Income Plan (FIMIP) (Fund name change w.e.f. 30 June 2014, Erstwhile FT India Monthly Income Plan ) Franklin India Corporate Bond Opportunities Fund (FICBOF) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Corporate Bond Opportunities Fund) Franklin India Income Opportunities Fund (FIIOF) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Income Opportunities Fund ) Franklin India Dynamic Accrual Fund (FIDA) (Fund name change w.e.f. 01 December 2014, Erstwhile Franklin India Income Fund ) Franklin India Treasury Management Account (FITMA) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Treasury Management Account) Franklin India Income Builder Account (FIIBA) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Income Builder Account ) Franklin India Ultra Short Bond Fund (FIUBF) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Ultra Short Bond Fund) Franklin India Government Securities Fund (FIGSF) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Government Securities Fund) Franklin India Banking & PSU Debt Fund (FIBPDF) Franklin India Short Term Income Plan (FISTIP) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Short Term Income Plan) Franklin India Savings Plus Fund (FISPF) (Fund name change w.e.f. 18 March 2014, Erstwhile Templeton Floating Rate Income Fund) Franklin India Low Duration Fund (FILDF) (Fund name change w.e.f. 30 June 2014, Erstwhile Templeton India Low Duration Fund) Annexure Scheme Performance SIP Returns Dividend/Bonus History/Fund Managers Industry Experience

3 Equity Market Snap Shot Anand Radhakrishnan, CIO Franklin Equity Global Global equity markets went through a testing time during the calendar year 2014, exhibiting economic recovery in patches. Almost all the emerging equity markets barring India and China lacked strong signals of recovery. While stagflation continued in Brazil and South Africa, declining crude oil prices impacted Russian markets leading to a steep fall in ruble. China was plagued with slowing economic growth prospects. Among developed markets, Europe and Japan continued to battle with deflation, their central banks continued with monetary support to revive economy. However, US economy showed signs of recovery but Fed in its last policy meet emphasized on being 'patient' regarding raising the interest rates. The developed markets outperformed their emerging market peers, wherein MSCI AC World index and MSCI EM index returned 2.10% and -4.63% respectively in China was the top performer for the year as faltering growth (weakening factory gauge) raised hopes of government taking measures to boost the world's second-largest economy. Russian equities were the worst performers as falling crude prices affected the oil exporter nation. In commodities market, crude oil prices closed the year with second-biggest annual decline ever due to rise in oil inventories in US (US oil production surged to a three decade high during the year) along with OPEC's stance on maintaining the same level of output despite a surge in global output and falling demand. However, gold prices remained nearly range bound in dollar terms. INDIA Yearly Change (%) Yearly Change (%) MSCI AC World Index FTSE Eurotop 100 MSCI AC Asia Pacific Dow Jones Nasdaq S&P 500 *As on Dec 30, 2014 Indian equity markets had a landmark year and ended 2014 with highest gains over last five years. The rally which began on the anticipation of a stable government was boosted by a decisive victory in central elections, resulting in a stable government with focus on economic growth and development. Further, favourable developments on the macroeconomic front such as substantial fall in both CPI and WPI inflation levels and significant fall in current account deficit, coupled with a steep fall in global crude oil prices and large foreign inflows supported the overall market momentum. Both interest rate sensitives and cyclical sectors performed during the year. Banking, auto and capital goods sectors were the top performers. Interest rate sensitive sectors viz. banking and auto performed on account of sharp fall in inflation coupled with anticipation of softer interest rates in coming months. Further, rising optimism regarding economic and investment cycle revival, helped the capital goods sector. Among sectoral indices, almost all the sectors closed the year in green. However, oil and gas, realty and metals turned out to be the worst performing sectors. While bearish global crude oil prices kept the performance of Oil & Gas stocks in check, uncertainty regarding coal block allocation, for which the ordinance route was announced at the end of year and weak macroeconomic data from China weighed on metal stocks. Sluggish home sales numbers and lack of demand for real estate in almost all metro and tier-ii cities in the country weighed on real estate stocks. Mid and small cap equity indices significantly outperformed their large cap peers. FIIs flows into Indian equities continued to be robust and aggregated to a net $16.16 bn. Macro/Policy: On macro-economic front, while data on inflation and current account deficit (remained within the estimated range) was favourable, data on manufacturing as suggested by Index of Industrial Production (IIP) growth was lacklustre and fiscal deficit and trade deficit showed weaker trends. India's IIP contracted by 4.2%YoY in October, dragged down by a fall in manufacturing and capital goods sectors. Even though mining and electricity grew by 5.2%YoY and 13.3%YoY respectively, manufacturing (which has the highest weight in the index) contracted by 7.6%YoY. Though manufacturing sector continued to disappoint, the cumulative IIP growth for the period April-October stood at 1.9% as compared to 0.2% in the corresponding period last fiscal Xetra DAX CAC 40 FTSE 100 Hang Seng Nikkei KOSPI 2.65* Recent data on trade deficit also pointed at a weakening trend. The cumulative trade deficit for April-November was estimated at $ bn which was higher than the deficit of $96.89 bn during April-November Faltering export growth on account of muted global economic growth outlook and rise in non-oil imports point towards a widening trade deficit. However, trade deficit as a percentage of GDP was lower at 4.8% in April-November 2014 compared to 5% in April-November OUTLOOK The spectacular run experienced by equity markets in 2014 was mainly driven by 'hopes' of meaningful reforms coupled with some sporadic sparks of recovery as highlighted by improvement in a few macroeconomic indicators. While execution of the measures introduced by government may take time to have an effect on the real economy, given a stable political environment the risk of derailment from the economic growth appear to be limited. Corporate earnings are expected to pick up going ahead and may be led by both topline growth as well as margin expansion. Moreover, one important indicator viz. corporate profitability to gross domestic product (GDP) ratio for BSE 500 companies (ex financials) is currently below the long period average and is expected to improve in line with overall economic growth. Pick up in discretionary demand and investment cycle taking off will be two important indicators which will provide cues for further movement in equity markets. While discretionary demand has shown signs of improvement, infrastructure may be the stepping stone for revival of the investment cycle. A probable reversal in crude oil prices, weaker global growth prospects and rise in interest rates by US Federal Reserve may add to volatility in the near to medium term. However, given the expectation of decline in domestic interest rates and subsequent beginning of the investment cycle, we believe that gradual recovery in economic growth is likely to continue and translate into stronger earnings growth in the long term. With re-rating already factored in valuations the headroom for P/E multiple expansion is limited. Hence incremental returns are likely to be led by corporate earnings growth. At this juncture, while there is general consensus on the recovery, there may be bouts of volatility due to global 'risk off' factors and hence a cautiously optimistic stance is warranted. As a result, investors should adopt a systematic approach to investing in order to benefit from long term prospects of Indian economy. S&P BSE Sensex CNX Nifty CNX 500 CNX Midcap S&P BSE Smallcap Yearly Change (%) Templeton Equity View : The New Reality Chetan Sehgal, CIO - India, Emerging Markets Those who believe in the power of predictions would certainly have met their match in 2014 when many events turned out very different from what was expected at the beginning of the year. Politically India stood out as having elected a stable government, well poised to lead India back to a growth path. Globally 2014 was also amongst the most violent years in a long time and yet oil prices which typically spiked as a consequence of geopolitics came down sharply. That impacted the profitability of an entire sector and several countries which depended on oil exports. Russia saw the ruble lose nearly half its value, while at the same time without so much of a concern the yen lost 30%. Gold which was considered a safe haven remained precisely that - it remained range bound in USD terms through the course of the year while commodities such as iron ore saw their prices decline precipitously. Thus in many terms it appears that the tide eventually turned in Looking forward, we expect 2015 to be a year of rebuild and repair. Companies in many sectors; and many countries would try to raise capital. Globally, there is hope that there would be more reconciliation on the political front as it is in no one's interest to take things to a precipice. The distortions of 2014 may well be termed as new realities in Some of those are yet to be factored in by the marketplace. 3

4 Fixed Income Market Snap Shot Santosh Kamath, CIO - Fixed Income Globally, bond yields fell significantly during calendar year 2014, supported by concerns on economic growth, accommodative stance of major central banks, and a sharp fall in crude oil prices in the latter part of the year. The European Central Bank (ECB) cut interest rates to record lows in early September, trying to lift inflation and support a stagnating Eurozone economy. The ECB is also contemplating further monetary stimulus, although its president Mario Draghi said in the beginning of December that the central bank would wait until early next year before announcing any additional stimulus measures. Economic growth concerns remain within the Eurozone, with the European Commission cutting growth forecast for 2014 to 0.8% (from 1.2% earlier) and for 2015 to 1.1% (from 1.7% earlier). In late November, China's central bank cut interest rates for the first time in over two years, to help bolster economic growth. Bank of Japan also boosted its own quantitative easing (QE)program recently, as its economy officially slipped into recession. Meanwhile, the US Federal Reserve ended its QE program in October, as widely expected by the markets. The Fed removed from its December policy meeting statement the phrase that it would wait a considerable time before starting to raise rates, although it added that it will be patient on interest rate timing. In the currencies space, the US dollar garnered strength, with the dollar index rising close to 13% during the calendar year. In India too bond yields headed south especially in the second half of the calendar year, supported by moderation in inflation, reduction in twin deficits, improving liquidity conditions, and a sharp fall in international crude oil prices. The RBI maintained a strict vigil on inflation, and adopted Consumer Price Index (CPI) inflation as the nominal anchor for monetary policy early in the year, as per recommendations of the RBI appointed Urjit Patel Committee report. As a result it has left policy rates at elevated levels, despite economic growth remaining subdued. However, with CPI inflation moderating significantly, the central bank revised downwards the central forecast for CPI inflation to 6% for March 2015 (from 8% earlier) in its December 2, 2014 bimonthly monetary policy review, and said that risks to the January 2016 target of 6% now appear evenly balanced. RBI also added that if the current inflation momentum and changes in inflationary expectations continue, and fiscal developments are encouraging, a change in the monetary policy stance is likely early next year, including outside the policy review cycle. Foreign portfolio inflows into Indian debt picked up strongly during the year, aggregating to record high of around a net $26 bn in Domestic Market Scenario Yields: Bond yields fell considerably across the curve during the calendar year, although yields fell more at the longer end. At the shorter end of the curve, the 1-year gilt yield closed the year down 62bps. At the longer end, the 10 year gilt yield closed down 107bps, while the 30-year gilt yield closed down 131bps. Corporate bond yields also fell significantly, with the 5-year AAA corporate bond yieldclosing the year down 96 bps. Forex: The rupee managed to gain strength in the first half of the calendar year, but depreciated in the second half of the year, primarily due to global strength in the US dollar. It finally closed the year down about 2% against the US dollar, but has managed to fare relatively better than most other emerging market currencies in Although the rupee weakened a bit against the US dollar during the year, it managed to post healthy gains against other major currencies like the euro and yen in Liquidity/borrowings: Liquidity conditions improved especially in the second half of the calendar year due to structural factors and fine-tuning the liquidity management framework. In April, RBI had increased the liquidity provided under term repos and decreased the liquidity provided under overnight repos under the Liquidity Adjustment Facility (LAF) in accordance with Urjit Patel committee's recommendation, as it felt that the term repo had evolved as a useful indicator of underlying liquidity conditions, and it also allowed market participants to hold liquidity for a longer period. The RBI also announced a revised liquidity management framework in late August, to provide more flexibility to banks and ensure more transparency in liquidity management operations. According to the new framework, the central bank would now conduct 4 term repos of 14-day tenor in a reporting fortnight on every Tuesday and Friday, upto 0.75 NDTL (net demand and time liabilities) of banks. Unlike earlier, RBI announced a fixed schedule for these 14-day term repo operations.there would be no change in the amount that banks can access from the LAF window (upto 0.25 NDTL) at fixed repo rate. RBI said that it will conduct overnight variable rate repo and reverse repo auctions based on an assessment of liquidity in the system, and it also added that it may announce special variable rate short term repo/reverse repo auctions at short notice to take care of fast-changing liquidity conditions. The overnight call money rate finally closed the year at 9.00%, compared to last year's close of 8.85%. During the year 2014, there was an average net injection of Rs bn by the RBI as part of its liquidity operations, compared to an average net injection of Rs bn in the previous calendar year. Macro: CPI inflation continued to moderate and fell to 4.4%YoY in November 2014, from 11.2%YoY a year back in November This makes it the lowest level in the new CPI series, since it started in January The fall was primarily helped by a drop in food inflation, and a favourable base effect. Core CPI (excl. food & fuel) inflation also slowed to 5.5%YoY in November 2014, from around 8% over the past year. The fall in wholesale price index (WPI) inflation was even more intense as it dropped to 0.0%YoY in November 2014, from 7.5%YoY in the corresponding month a year back. The fall was primarily helped by a drop in food & fuel inflation. Fiscal deficit has been in control, although recent data showed that for the first eightmonths of FY15 (April November 2014), fiscal deficit has already touched 99 the full year budgeted estimate. The deficit was around 94% of the estimate in the corresponding period in the previous fiscal year. This has been primarily due to weak tax revenue collection, which has only met 42.3% of the full year budgeted estimate so far in FY15. However, expenditure has been kept in control, with total expenditure accounting for about 60 the full year budgeted estimate so far this year. The government had recently announced a 10% reduction in non-plan expenditure, excluding obligatory spending such as debt servicing, salaries, pension & grants to rein in fiscal deficit. Fiscal deficit has been pegged to be brought down to 3.6 GDP in FY16 and to 3% in FY17. OUTLOOK 2014 turned out to be a good year for duration strategies, with bond yields softening considerably, especially in the second half of the calendar year. Both inflation and inflation expectations have come down, and if the momentum continues, then it will provide the RBI with elbow room to tinker with policy rates in early Fiscal deficit situation has also improved, and although we might not be entirely out of the woods yet, it is unlikely that we will miss the 4.1% budgeted fiscal deficit target for FY15 by a very wide margin. Accrual strategies posted comparatively lower, but still healthy returns in 2014, with yields remaining elevated for a large part of the year, and also with the credit environment improving. The credit upgradesfor companies have picked up, and is expected to improve further as the economy recovers. Companies are finding it easier to raise capital through other means, thereby reducing their leverage or debt component.also, the RBI recently eased norms for infrastructure loans, by providing flexible structuring and re-financing of existing long term project loans to infrastructure and core industries. This may help to provide more flexibility to banks for extending long term credit to the sector, and reduce their non-performing. The rupee has depreciated a bit recently against the dollar, but the depreciation is not as alarming as in mid The sharp fall in international crude oil prices over the past few months has been a boon for oil importing countries like India helping to reduce our oil import burden. This in turn will help to improve our current account balance, which will augur well for the bond markets. However, at the same time, if crude prices continue to remain depressed, then it may impact liquidity or flows from oil exporting or producing countries, thereby squeezing foreign portfolio flows into the Indian markets to some extent. Despite the recent fall in bond yields, we believe that duration strategies continue to be favourably placed for 2015, with interest rates poised to come down. Investors with relatively higher risk profile and investment horizon can consider longer-dated bond/gilt strategies to benefit from the potential fall in bond yields. Also, with yields still remaining elevated at the shorter end of curve and with the credit environment improving, we continue to remain positive on corporate bonds and accrual strategies. 10 Year Gilt Call rates Exchange rate (Rs./$) Liquidity Operations - Avg. net injection(+) / net absorption (-) by RBI during the month (in Rs. Bn) 31-Dec /8.85% 61.80/ Dec /9.00% 63.03/

5 Franklin India Bluechip Fund FIBCF The fund manager seeks steady and consistent growth by focusing on wellestablished, large size companies An open-end growth scheme with an objective primarily to provide medium to long-term capital appreciation. December 1, 1993 Anand Radhakrishnan & Anand Vasudevan Direct - Direct - ` crores ` ` ` ` TURNOVER Portfolio Turnover 40.60% VOLATILITY MEASURES (3 YEARS) Standard Deviation 4.34 R-squared 0.87 Beta 0.98 Sharpe Ratio* 0.91 * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) EXPENSE RATIO : 2.20% EXPENSE RATIO (DIRECT) : 1.33% Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, Auto Mahindra & Mahindra Ltd Tata Motors Ltd Hero Motocorp Ltd Bajaj Auto Ltd Auto Ancillaries Exide Industries Ltd Banks HDFC Bank Ltd* ICICI Bank Ltd* Indusind Bank Ltd* Yes Bank Ltd* Kotak Mahindra Bank Ltd* Axis Bank Ltd Bank Of Baroda Punjab National Bank Ltd Union Bank Of India Cement Grasim Industries Ltd Acc Ltd Ultratech Cement Ltd Construction Project Larsen And Toubro Ltd* Consumer Non Durables Marico Ltd Asian Paints Ltd Ferrous Metals Jindal Steel & Power Ltd Tata Steel Ltd Industrial Products Cummins India Ltd Minerals/Mining Coal India Ltd Non - Ferrous Metals Hindalco Industries Ltd Total Equity Holding Total Debt Holding Call, Cash and other current asset Total Asset Oil Oil & Natural Gas Corp Ltd Petroleum Products Reliance Industries Ltd Bharat Petroleum Corporation Ltd Pharmaceuticals Dr Reddy'S Laboratories Ltd* Cadila Healthcare Ltd Lupin Ltd Sun Pharmaceutical Industries Ltd Power Power Grid Corp Of India Ltd Torrent Power Ltd Services Aditya Birla Nuvo Ltd Software Infosys Ltd* Cognizant Technology (USA)* Wipro Ltd Tata Consultancy Services Ltd HCL Technologies Ltd Telecom - Services Bharti Airtel Ltd* Idea Cellular Ltd Total Equity Holding ` 5000/1 ` 1000/1 EXIT LOAD In respect of each purchase of Units - 1% if the Units are redeemed/switched-out within one year of allotment SIP - If you had invested ` 5000 every month in FIBCF... 1 Year 3 Year 5 Year 7 Year 10 Year Since jan 97* Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages *B: Benchmark, AB: Additional Benchmark * Top 10 holdings Total amount Invested (Rs) 60, , , , ,000 1,080,000 Total value as on Dec 31, 2014 (Rs) 71, , , ,107 1,377,751 12,533,274 Returns 39.03% 24.29% 16.58% 16.57% 15.86% 23.50% Total value of B : S&P BSE Sensex 68, , , ,173 1,163,447 4,621,470 B:S&P BSE Sensex Returns 27.39% 21.74% 14.40% 13.45% 12.71% 14.43% Total value of AB :CNX Nifty 69, , , ,441 1,165,880 4,570,634 AB:CNX Nifty Returns 29.48% 21.85% 14.51% 13.50% 12.75% 14.33% Sector Allocation - Total Assets REST INDUSTRIAL PRODUCTS CONSTRUCTION PROJECT CONSUMER NON DURABLES PETROLEUM PRODUCTS AUTO TELECOM - SERVICES - CEMENT PHARMACEUTICALS SOFTWARE BANKS 1.92% 3.28% 3.53% 4.97% 5.46% 5.52% 5.55% 7.31% 14.14% 16.31% 3% A fund that invests in large cap stocks (BROWN) HIGH RISK** 5

6 Templeton India Growth Fund TIGF Templeton Equity Portfolio Managers adopt a long term disciplined approach to investing and use the widely known philosophy of value investing An open-end growth scheme withthe objective to provide long-term capital growth to its unitholders September 10, 1996 Chetan Sehgal Direct - Direct - ` crores TURNOVER Portfolio Turnover 7.44% **S&P BSE Sensex MSCI India Value * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) EXPENSE RATIO : 2.69% ` ` ` ` VOLATILITY MEASURES (3 YEARS) Standard Deviation R-squared 0.79** 0.79 Beta 1.17** 0.87 Sharpe Ratio* EXPENSE RATIO (DIRECT) : 1.97% Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, ` 5000/1 Auto Maruti Suzuki India Ltd.* Tata Motors Ltd., A Auto Ancillaries Balkrishna Industries Ltd Banks ICICI Bank Ltd.* Federal Bank Ltd.* HDFC Bank Ltd ING Vysya Bank Ltd Cement Grasim Industries Ltd JK Cement Ltd Chemicals Tata Chemicals Ltd.* Consumer Non Durables EID Parry India Ltd Ferrous Metals MOIL Ltd Finance Bajaj Holdings and Investment Ltd.* Tata Investment Corp. Ltd.* Sundaram Finance Ltd.* Gas Total Equity Holding Total Debt Holding Call, Cash and other current asset Total asset GAIL India Ltd Oil Oil & Natural Gas Corp. Ltd Cairn India Ltd Petroleum Products Reliance Industries Ltd.* Pharmaceuticals Dr. Reddy's Laboratories Ltd.* Software Infosys Ltd.* Total Equity Holding * Top 10 holdings ` 1000/1 EXIT LOAD In respect of each purchase of Units - 1% if the Units are redeemed/switched-out within one year of allotment SIP - If you had invested ` 5000 every month in TIGF 1 Year 3 Year 5 Year 7 Year 10 Year Since Inception Total amount Invested (Rs) 60, , , , ,000 1,100,000 Total value as on Dec 31, 2014 (Rs) 69, , , ,598 1,294,602 8,854,291 Returns 30.92% 23.21% 14.56% 14.87% 14.70% 19.80% Total value of B :S&P BSE Sensex 68, , , ,173 1,163,447 4,797,434 B:S&P BSE Sensex Returns 27.39% 21.74% 14.40% 13.45% 12.71% 14.32% Total value of B :MSCI India Value 65, , , ,716 1,013,745 N.A B:MSCI India Value Returns 18.34% 14.73% 7.95% 8.52% 10.12% N.A Total value of AB : CNX Nifty 69, , , ,441 1,165,880 4,753,876 AB : CNX Nifty returns 29.48% 21.85% 14.51% 13.50% 12.75% 14.24% Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages *B: Benchmark, AB: Additional Benchmark Sector Allocation - Total Assets REST AUTO ANCILLARIES OIL PETROLEUM PRODUCTS CEMENT AUTO PHARMACEUTICALS SOFTWARE CHEMICALS BANKS FINANCE 0.89% 4.72% 4.15% 4.18% 4.81% 6.64% 6.74% 9.26% 14.77% 20.93% 22.90% A fund that invests predominantly in large cap stocks a value fund (BROWN) HIGH RISK** 6

7 Franklin India Prima Plus This is a Simple and Performing scheme which is eligible for distribution by new cadre of distributors. FIPP T h e f u n d m a n a g e r s e e k s c a p i t a l appreciation over the long-term by focusing on wealth creating companies (companies that generate return on capital in excess of their cost of capital) across all sectors. An open end growth scheme with an objective to provide growth of capital p l u s r e g u l a r d i v i d e n d t h r o u g h a diversified portfolio of equities, fixed income securities and money market instruments. September 29, 1994 Anand Radhakrishnan & R. Janakiraman Direct - Direct - ` crores TURNOVER Portfolio Turnover 32.51% VOLATILITY MEASURES (3 YEARS) Standard Deviation 4.14 R-squared 0.87 Beta 0.81 Sharpe Ratio* 1.48 * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) EXPENSE RATIO : 2.29% EXPENSE RATIO (DIRECT) : 1.43% ` 5000/1 ` 1000/1 ` ` ` ` Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, EXIT LOAD In respect of each purchase of Units - 1% if the Units are redeemed/switched-out within one year of allotment Auto Eicher Motors Ltd* Tata Motors Ltd Mahindra & Mahindra Ltd Auto Ancillaries Amara Raja Batteries Ltd Bosch Ltd Balkrishna Industries Ltd Exide Industries Ltd Banks ICICI Bank Ltd.* HDFC Bank Ltd* Indusind Bank Ltd* Yes Bank Ltd* Kotak Mahindra Bank Ltd* Axis Bank Ltd Karur Vysya Bank Ltd Federal Bank Ltd Punjab National Bank Ltd Bank Of Baroda Cement Grasim Industries Ltd Ultratech Cement Ltd Chemicals Pidilite Industries Ltd Aarti Industries Ltd Construction Project Larsen And Toubro Ltd Voltas Ltd Consumer Durables Havells India Ltd Consumer Non Durables Marico Ltd United Breweries Ltd Asian Paints Ltd Finance Credit Analysis & Research Ltd Crisil Ltd Repco Home Finance Ltd Industrial Capital Goods Alstom T&D India Ltd Crompton Greaves Ltd Industrial Products Cummins India Ltd SIP - If you had invested ` 5000 every month in FIPP Total Equity Holding Total Debt Holding Call, Cash and other current asset Total Asset Greaves Cotton Ltd SKF India Ltd Finolex Industries Ltd Shakti Pumps India Ltd Media & Entertainment Jagran Prakashan Ltd HT Media Ltd Minerals/mining Gujarat Mineral Dev Corp Ltd Petroleum Products Reliance Industries Ltd Bharat Petroleum Corporation Ltd Pharmaceuticals Torrent Pharmaceuticals Ltd* Dr Reddy'S Laboratories Ltd* Cadila Healthcare Ltd Pfizer Ltd/India IPCA Laboratories Ltd Services Aditya Birla Nuvo Ltd Software Infosys Ltd* Cognizant Technology (Usa) Wipro Ltd HCL Technologies Ltd Telecom - Services Bharti Airtel Ltd* Tata Communications Ltd Textile Products Himatsingka Seide Ltd Transportation Gujarat Pipavav Port Ltd Container Corp Of India Ltd Gateway Distriparks Ltd Unlisted Quantum Information Services Numero Uno International Ltd Total Equity Holding * Top 10 holdings 1 Year 3 Year 5 Year 7 Year 10 Year Since Inception Total amount Invested (Rs) 60, , , , ,000 1,210,000 Total value as on Dec 31, 2014 (Rs) 78, , , ,489 1,629,285 21,315,894 Returns 62.06% 34.94% 23.09% 20.81% 18.97% 24.00% Total value of B :CNX , , , ,823 1,162,489 6,309,663 B:CNX 500 Returns 36.88% 24.64% 15.44% 14.21% 12.69% 14.39% Total value of AB : CNX NIFTY 69, , , ,441 1,165,880 5,647,465 AB:CNX NIFTY Returns 29.48% 21.85% 14.51% 13.50% 12.75% 13.49% Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages *B: Benchmark, AB: Additional Benchmark Sector Allocation - Total Assets REST PETROLEUM PRODUCTS 3.19% CONSUMER NON DURABLES 3.29% TRANSPORTATION 3.55% TELECOM -SERVICES 4.18% INDUSTRIAL PRODUCTS 4.86% AUTO 5.01% AUTO ANCILLARIES 7.41% PHARMACEUTICALS 8.79% SOFTWARE 9.86% BANKS 23.36% 26.49% Primarily a large cap fund with some allocation to small/mid cap stocks (BROWN) HIGH RISK** 7

8 Franklin India Prima Fund FIPF The fund manager seeks aggressive growth by focusing primarily on mid and small cap companies. An open-end growth scheme with an objective to provide medium to long term capital appreciation as a primary objective and income as a secondary objective. December 1, 1993 R. Janakiraman & Roshi Jain Direct - Direct - ` crores TURNOVER Portfolio Turnover 29.97% VOLATILITY MEASURES (3 YEARS) Standard Deviation 4.66 R-squared 0.75 Beta 0.85 Sharpe Ratio* 1.99 * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) EXPENSE RATIO : 2.32% EXPENSE RATIO (DIRECT) : 0.88% ` 5000/1 ` 1000/1 ` ` ` ` Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, EXIT LOAD In respect of each purchase of Units - 1% if the Units are redeemed/switched-out within one year of allotment Auto Eicher Motors Ltd TVS Motor Co. Ltd Auto Ancillaries Amara Raja Batteries Ltd.* Bosch Ltd Balkrishna Industries Ltd Apollo Tyres Ltd Exide Industries Ltd Banks Yes Bank Ltd.* IndusInd Bank Ltd.* Axis Bank Ltd ING Vysya Bank Ltd Karur Vysya Bank Ltd City Union Bank Ltd HDFC Bank Ltd Cement JK Cement Ltd ACC Ltd Chemicals Pidilite Industries Ltd.* Atul Ltd Construction Sobha Ltd Construction Project Voltas Ltd Larsen & Toubro Ltd Sadbhav Engineering Ltd Consumer Durables Havell's India Ltd Bata India Ltd Consumer Non Durables Kansai Nerolac Paints Ltd Engineering Engineers India Ltd Ferrous Metals Pennar Industries Ltd Fertilisers Coromandel International Ltd Finance Repco Home Finance Ltd.* Sundaram Finance Ltd LIC Housing Finance Ltd Credit Analysis and Research Ltd Crisil Ltd Gas Gujarat State Petronet Ltd SIP - If you had invested ` 5000 every month in FIPF 1 Year 3 Year 5 Year 7 Year 10 Year Since Inception Total amount Invested (Rs) 60, , , , ,000 1,265,000 Total value as on Dec 31, 2014 (Rs) 84, , ,966 1,089,858 1,759,278 26,248,621 Returns 84.86% 47.31% 30.26% 26.80% 20.40% 24.07% Total value of B : CNX , , , ,823 1,162,489 6,675,763 B:CNX 500 Returns 36.88% 24.64% 15.44% 14.21% 12.69% 13.82% Total value of CNX Midcap 77, , , ,210 1,301,327 N.A CNX Midcap Returns 58.99% 31.03% 18.06% 16.98% 14.80% N.A Total value of AB : CNX Nifty 69, , , ,441 1,165,880 6,022,057 AB : CNX Nifty Returns 29.48% 21.85% 14.51% 13.50% 12.75% 13.03% Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages CNX Midcap index has been included as additional benchmark for Franklin India Prima Fund (FIPF) effective May 20, 2013 *B: Benchmark, AB: Additional Benchmark Sector Allocation - Total Assets REST GAS TRANSPORTATION CEMENT INDUSTRIAL CAPITAL GOODS PHARMACEUTICALS AUTO ANCILLARIES SOFTWARE FINANCE INDUSTRIAL PRODUCTS BANKS 2.99% 3.24% 3.36% 3.62% 4.65% 6.35% 7.45% 8.48% 9.24% 15.98% 34.65% Petronet LNG Ltd Hotels Indian Hotels Co. Ltd Industrial Capital Goods Bharat Electronics Ltd Thermax Ltd Crompton Greaves Ltd Industrial Products Finolex Cables Ltd.* FAG Bearings (India) Ltd.* Greaves Cotton Ltd SKF India Ltd Media & Entertainment Jagran Prakashan Ltd Minerals/mining Gujarat Mineral Development Corp. Ltd Pesticides Bayer Cropscience Ltd PI Industries Ltd Petroleum Products Bharat Petroleum Corp. Ltd Pharmaceuticals Torrent Pharmaceuticals Ltd.* IPCA Laboratories Ltd Ajanta Pharma Ltd Power JSW Energy Ltd Software Mindtree Ltd.* Cyient Ltd.* HCL Technologies Ltd Eclerx Services Ltd Telecom - Services Bharti Airtel Ltd Textile Products Himatsingka Seide Ltd Transportation Gujarat Pipavav Port Ltd Gateway Distriparks Ltd Unlisted Him Techno Total Equity Holding Total Equity Holding Total Debt Holding Call, Cash and other current asset Total Asset A fund that invests in mid and small cap stocks * Top 10 holdings (BROWN) HIGH RISK**

9 Franklin India Flexi Cap Fund This is a Simple and Performing scheme which is eligible for distribution by new cadre of distributors. FIFCF The fund manager will invest in companies based on a research driven, bottom-up stock selection process, irrespective of their market capitalization and sectors. An open-end diversified equity fund that seeks to provide medium to long term capital appreciation by investing in stocks across the entire market capitalization range. March 2, 2005 Anand Vasudevan, Roshi Jain & R. Janakiraman Direct - Direct - ` crores TURNOVER Portfolio Turnover 46.65% VOLATILITY MEASURES (3 YEARS) Standard Deviation 4.60 R-squared 0.88 Beta 0.91 Sharpe Ratio* 1.37 * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) ` ` ` ` EXPENSE RATIO : 2.29% EXPENSE RATIO (DIRECT) : 1.61% Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, Auto Mahindra & Mahindra Ltd Hero Motocorp Ltd Maruti Suzuki India Ltd Tata Motors Ltd TVS Motor Co Ltd Auto Ancillaries Amara Raja Batteries Ltd* Balkrishna Industries Ltd Banks Yes Bank Ltd* ICICI Bank Ltd* HDFC Bank Ltd* Axis Bank Ltd Kotak Mahindra Bank Ltd State Bank Of India Indusind Bank Ltd Cement Grasim Industries Ltd ACC Ltd Construction Project Larsen And Toubro Ltd* Consumer Durables Titan Co Ltd Consumer Non Durables Glaxosmithkline Consumer Healthcare Ltd Kansai Nerolac Paints Ltd Kaveri Seed Co Ltd Ferrous Metals Jindal Steel & Power Ltd Finance Repco Home Finance Ltd Credit Analysis & Research Ltd Gas Total Equity Holding Total Debt Holding Call, Cash and other current asset Total Asset Petronet Lng Ltd Gujarat State Petronet Ltd Industrial Products Greaves Cotton Ltd SKF India Ltd Petroleum Products Bharat Petroleum Corporation Ltd Pharmaceuticals Torrent Pharmaceuticals Ltd* Dr Reddy'S Laboratories Ltd* Cipla Ltd Power Torrent Power Ltd Kec International Ltd Software Cognizant Technology (USA)* Infosys Ltd* Hcl Technologies Ltd Mindtree Ltd Wipro Ltd Cyient Ltd Telecom - Services Bharti Airtel Ltd* Idea Cellular Ltd Transportation Gujarat Pipavav Port Ltd Total Equity Holding * Top 10 holdings ` 5000/1 ` 1000/1 EXIT LOAD In respect of each purchase of Units - 1% if the Units are redeemed/switched-out within one year of allotment SIP - If you had invested ` 5000 every month in FIFCF 1 Year 3 Year 5 Year 7 Year Since Inception Total amount Invested (Rs) 60, , , , ,000 Total value as on Dec 31, 2014 (Rs) 77, , , ,813 1,500,865 Returns 58.52% 35.29% 22.56% 20.75% 18.09% Total value of B : CNX , , , ,823 1,124,811 B:CNX 500 Returns 36.88% 24.64% 15.44% 14.21% 12.61% Total value of AB :CNX Nifty 69, , , ,441 1,126,110 AB:CNX Nifty returns 29.48% 21.85% 14.51% 13.50% 12.63% Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages *B: Benchmark, AB: Additional Benchmark Sector Allocation - Total Assets REST INDUSTRIAL PRODUCTS CONSUMER NON DURABLES TELECOM - SERVICES CEMENT CONSTRUCTION PROJECT AUTO ANCILLARIES AUTO PHARMACEUTICALS SOFTWARE BANKS 2.54% 3.39% 3.55% 3.97% 4.58% 5.27% 7.44% 10.38% 11.79% 17.21% 29.88% A fund that invests in stocks of companies across the market cap range (BROWN) HIGH RISK** 9

10 Franklin India High Growth Companies Fund FIHGCF The fund manager seeks high growth by focussing on companies/sectors with high growth rates or potential. An open-end diversified equity fund that seeks to achieve capital appreciation through investments in Indian companies/ sectors with high growth rates or potential. July 26, 2007 Roshi Jain & R. Janakiraman Direct - Direct - ` crores TURNOVER Portfolio Turnover 73.15% VOLATILITY MEASURES (3 YEARS) Standard Deviation 4.76 R-squared 0.83 Beta 0.91 Sharpe Ratio* 1.98 * Annualised. Risk-free rate assumed to be 8.16% (based on average of 3 month T-Bill Rate during last 3 months ) EXPENSE RATIO : 2.43% EXPENSE RATIO (DIRECT) : 1.33% ` ` ` ` Actual average expenses charged for the month of Dec 14 cities subject to maximum of 30 bps on daily net, ` 5000/1 Auto Maruti Suzuki India Ltd* Tata Motors Ltd* TVS Motor Co Ltd Banks Axis Bank Ltd* HDFC Bank Ltd* ICICI Bank Ltd* State Bank Of India* Bank Of Baroda Yes Bank Ltd ING Vysya Bank Ltd Indusind Bank Ltd Cement JK Lakshmi Cement Ltd Orient Cement Ltd Orient Paper & Industries Ltd Construction Consolidated Construction Consortium Ltd Consumer Durables Whirlpool Of India Ltd* Consumer Non Durables Glaxosmithkline Consumer Healthcare Ltd Kansai Nerolac Paints Ltd Finance Shriram Transport Finance Co Ltd Hotels EIH Ltd Industrial Capital Goods Bharat Electronics Ltd Schneider Electric Infrastruture Ltd Industrial Products Timken India Ltd Total Equity Holding Total Debt Holding Call, Cash and other current asset Total Asset Fag Bearings (India) Ltd SKF India Ltd Pesticides Bayer Cropscience Ltd Pharmaceuticals Sanofi India Ltd Cipla Ltd Dr Reddy'S Laboratories Ltd Torrent Pharmaceuticals Ltd Software Tech Mahindra Ltd* Tata Consultancy Services Ltd* Cognizant Technology (USA) Mindtree Ltd Cyient Ltd Telecom - Services Idea Cellular Ltd* Bharti Airtel Ltd Transportation Gateway Distriparks Ltd Total Equity Holding * Top 10 holdings ` 1000/1 EXIT LOAD 1% if redeemed/switchedout within two years of allotment SIP - If you had invested ` 5000 every month in FIHGCF 1 Year 3 Year 5 Year 7 Year Since Inception Total amount Invested (Rs) 60, , , , ,000 Total value as on Dec 31, 2014 (Rs) 86, , ,139 1,045,461 1,123,454 Returns 89.48% 47.57% 29.73% 25.62% 23.83% Total value of B :CNX , , , , ,921 B:CNX 500 returns 36.88% 24.64% 15.44% 14.21% 13.19% Total value of AB : CNX Nifty 69, , , , ,480 AB: CNX Nifty returns 29.48% 21.85% 14.51% 13.50% 12.61% Past performance may or may not be sustained in the future. Returns greater than 1 year period are compounded annualized. Dividends are assumed to be reinvested and bonus is adjusted. Load is not taken in to consideration. For SIP returns, monthly investment of equal amounts invested on the 1st day of every month has been considered. For scheme performance refer pages *B: Benchmark, AB: Additional Benchmark Sector Allocation - Total Assets REST CONSUMER NON DURABLES CONSUMER DURABLES CEMENT INDUSTRIAL CAPITAL GOODS TELECOM -SERVICES INDUSTRIAL PRODUCTS PHARMACEUTICALS AUTO SOFTWARE BANKS 3.08% 3.24% 3.69% 4.39% 5.71% 6.83% 8.18% 8.98% 14.15% 17.23% 24.52% A fund that invests in stocks of companies/ sectors with high growth rates or above average potential (BROWN) HIGH RISK** 10