HSBC Asset Management (India) Private Limited

Transcription

1 HSBC Asset Management (India) Private Limited Annual Report

2 DIRECTORS REPORT FOR THE YEAR ENDED MARCH 31, 2015 The Shareholders HSBC Asset Management (India) Private Limited The Directors of HSBC Asset Management (India) Private Limited (the Company/AMIN) have pleasure in submitting their report along with the audited financials for the Financial Year ended March 31, FINANCIAL RESULTS The performance of the Company during the financial year is summarized below: Particulars For the year ended (Rupees in Million) For the year ended Total Income Total Expenses Profit / (Loss) before Tax (75.419) Provision for Tax (including Current, Deferred (8.907) - and Fringe Benefit Tax) Profit/(Loss) After Tax (75.419) During the year under review, the Company made a net profit of Rs million as against net loss of Rs million during the previous year. 2. APPROPRIATIONS The Company does not propose to transfer any amount to the General Reserves. An amount of Rs million is proposed to be retained in the Statement of Profit and Loss. 3. DIVIDEND Considering the quantum of distributable surplus, the management of the Company does not intend to provide for dividend during the year. 4. OPERATIONS a) Mutual Fund While the markets continued to remain challenging during the financial year ending March 31, 2015, we observed diverse trends in Assets under Management. During the year, the following schemes were launched /rolled over / matured by HSBC Mutual Fund

3 Details of schemes launched during the period Scheme Name Date of Launch HSBC Managed Solution April 09, 2014 HSBC Fixed Term Series 102 April 28, 2014 HSBC Global Consumer February 02, 2015 Opportunities Fund HSBC Capital Protection March 17, 2015 Oriented Fund Series II Plan I Details of schemes rolled-over during the period Scheme Name Date of roll-over HSBC Fixed term Series 91 August 05, 2014 HSBC Fixed term Series 94 August 26, 2014 HSBC Fixed term Series 96 September 05, 2014 HSBC Fixed term Series 98 October 21, 2014 Details of schemes matured during the period Scheme Name Date of maturity HSBC Fixed term Series 89 April 4, 2014 HSBC Fixed term Series 90 April 4, 2014 HSBC Fixed term Series 95 August 28, 2014 HSBC Fixed term Series 97 October 29, 2014 HSBC Fixed term Series 99 November 14, 2014 HSBC Fixed term Series 100 December 4, 2014 HSBC Fixed term Series 101 January 22, 2015 The Company earned Investment Management fees to the tune of Rs crores (net of Service Tax) for managing the assets of HSBC Mutual Fund. The funds under management of the schemes of HSBC Mutual Fund as at March 31, 2015 was Rs. 8, crores. The Fund had 188,184 live investor accounts as at March 31, 2015 in its various schemes. b) Portfolio Management Services (PMS) The Company launched its Portfolio Management Services (PMS) offering on 27 March PMS offers segregated mandate and advisory solutions to a wide range of institutions including institutional investors (foreign and Indian), insurance companies, pension funds, large individual investors, welfare trusts, fund of funds among others. We undertake discretionary segregated mandates and advisory mandates for the above class of investors. As on March 31, 2015, the PMS business had Assets under Management of INR 99, crores under discretionary mandate and INR Crores under advisory mandate. 2

4 5. Performance of the Schemes of HSBC Mutual Fund Equity Schemes (a) HSBC Equity Fund (HEF) an open-ended diversified Equity Scheme HEF seeks to generate long-term capital growth from an actively managed portfolio of equity and equity related securities. The net assets of HEF amounted to Rs crores as at March 31, 2015 as against Rs crores as at March 31, Around 98.81% of the net assets were invested in equities, 1.44% of the net assets were invested in reverse repos/cblo and (- 0.25%) were in the net current assets as at March 31, HEF remained invested in a diversified portfolio across large capitalization stocks. The relative underweight in Healthcare resulted in underperformance against scheme benchmark for the period Date Of Inception : 10 Dec 02 Absolute Compounded Annualized Scheme Name & Benchmarks April 14 - April 13 - April 12 - Since March 15 March 14 March 13 Inception HSBC Equity Fund Growth S&P BSE 200 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HEF, 12,789 11,682 10, ,791 would have become Rs. 10,000, if invested in S&P 13,172 11,665 10,541 92,353 BSE 200, would have become Rs. 10,000, if invested in CNX Nifty, would have become 12,633 11,753 10,693 80,211 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (b) HSBC India Opportunities Fund (HIOF) an open-ended flexi-cap Equity Scheme HIOF seeks to generate 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 and 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. 3

5 The net assets of HIOF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 95.81% of the net assets were invested in equities, 4.64 % of the net assets were invested in reverse repos/cblo and (-0.45%) were in the net current assets as at March 31, HIOF outperformed its benchmark on a 1-year, 2-year basis and since its inception. Stock selections in sectors like Industrials, Materials, Financials, Technology, Energy, and Consumer Discretionary contributed to the outperformance during this period. Date Of Inception : 24 Feb 04 Absolute 4 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC India Opportunities Fund Growth S&P BSE 500 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HIOF, 14,506 12,793 10,021 65,147 would have become Rs. 10,000, if invested in S&P 13,297 11,644 10,414 49,033 BSE 500, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 46,634 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (c) HSBC Midcap Equity Fund (HMEF) an open-ended diversified Equity Scheme* HMEF seeks to generate long term capital growth from an actively managed portfolio of equity and equity related securities primarily being midcap stocks. However, it could move a portion of its assets towards fixed income securities if the fund manager becomes negative on the Indian equity markets. The net assets of HMEF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around % of the net assets were invested in equities, 1.25% of the net assets were invested in reverse repos/cblo and (-0.80 %) were in the net current assets as at March 31, HMEF has done well in terms of outperformance v/s benchmark due to stock selection across various sectors for the period The focus on reasonable growth oriented companies available at attractive valuations (PB/ROE) paid off. HMEF continues to be overweight in Auto Ancillary, Agro Chemicals, Capital Goods, Financials, Industrials and underweight in FMCG sector.

6 . Date Of Inception : 19 May 05 Absolute Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Midcap Equity Fund Growth S&P BSE Midcap (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HMEF, 16,669 12,840 9,118 37,456 would have become Rs. 10,000, if invested in S&P 14,948 11,386 9,570 32,618 BSE Midcap, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 42,674 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. *HSBC Small Cap Fund merged with HMEF with effect from April 26, 2014 and consequently ceases to exist. (d) HSBC Progressive Themes Fund (HPTF) an open-ended flexi-theme Equity Scheme HPTF 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. The net assets of HPTF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 99.17% of the net assets were invested in equities, 1.60% of the net assets were invested in reverse repos/cblo and (-0.77%) were in the net current assets as at March 31, HPTF is a theme based scheme. The focus being on Infrastructure considerably out-performed its benchmark during the year Date Of Inception : 23 Feb 06 Absolute Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Progressive Themes Fund Growth 5 Compounded Annualized Since Inception

7 Date Of Inception : 23 Feb 06 Absolute 6 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 S&P BSE 200 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HPTF, 17,387 10,465 8,942 18,932 would have become Rs. 10,000, if invested in S&P 13,172 11,665 10,541 27,660 BSE 200, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 27,728 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (e) HSBC Tax Saver Equity Fund (HTSF) - an open ended Equity linked Savings Scheme HTSF seeks 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 capitalization bias. The Fund may also invest in fixed income securities. The net assets of HTSF amounted to Rs crores as at March 31, 2015 compared to Rs crores as at March 31, Around % of the net assets were invested in equities, 1.16% of the net assets were invested in reverse repos/cblo and (-0.43%) were in the net current assets as at March 31, HTSF outperformed its benchmark during most of the time periods due to reasonable stock selection and the approach of creating a stable and quality portfolio. Going forward, the portfolio would be managed in a similar fashion of bottom up stock picking approach following our valuation - profitability framework of price to book/roe balanced by adequate risk management. Date Of Inception : 05 Jan 07 Absolute Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Tax Saver Equity Fund Growth S&P BSE 200 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Compounded Annualized Since Inception

8 Date Of Inception : 05 Jan 07 Absolute 7 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 Rs. 10,000, if invested in HTSF, 13,909 12,252 11,190 26,786 would have become Rs. 10,000, if invested in S&P 13,172 11,665 10,541 21,269 BSE 200, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 21,317 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (f) HSBC Dynamic Fund (HDF) - an open-ended Scheme HDF seeks 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. The net assets of HDF amounted to Rs crores as at March 31, 2015 compared to Rs crores as at March 31, Around 69.33% of the net assets were invested in equities, 31.23% of the net assets were invested in reverse repos/cblo and (-0.56%) were in net current assets as at March 31, HDF has underperformed its benchmark over the period due to high cash balance. The scheme allocates capital across equity and debt securities dynamically. In a year when equity market was rising, thus becoming more expensive, and debt market being cheap, the dynamic allocation to cash kept on rising through the year. An average cash balance of approx. 31% through the year was the main reason of underperformance. Date Of Inception : 24 Sep 07 Absolute Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Dynamic Fund Growth S&P BSE 200 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HDF, 12,322 11,320 10,159 13,796 would have become Rs. 10,000, if invested in S&P 13,172 11,665 10,541 17,086

9 Date Of Inception : 24 Sep 07 Absolute 8 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 BSE 200, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 17,218 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (g) HSBC Dividend Yield Equity Fund (HDYF) - an open ended Scheme* HDYF aims to provide long-term growth from a diversified portfolio of equities and equity related instruments. The net assets of HDYF amounted to Rs crores as at March 31, 2015 compared to Rs crores as at March 31, Around % of the net assets were invested in equities, 2.44% of the net assets were invested in reverse repos/cblo and (-0.39%) were in net current assets as at March 31, During the period , HDYF was overweight on Consumer Discretionary and Materials (domestic cyclicals) which helped the fund to outperform its benchmark. Date Of Inception : 21 Mar 07 Absolute Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Dividend Yield Equity Fund Growth S&P BSE 200 (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HUOF, 13,335 11,703 10,482 16,751 would have become Rs. 10,000, if invested in S&P 13,172 11,665 10,541 22,981 BSE 200, would have become Rs. 10,000, if invested in CNX 12,633 11,753 10,693 22,568 Nifty, would have become Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since

10 Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. *HSBC Unique Opportunities Fund had undergone a change in its investment objective, investment strategy etc. and re-named as HDYF. The changes being in the nature of fundamental attribute changes, the investors have been notified of the same giving then an option to redeem from the Fund. The change was effective from July 18, Debt Schemes (h) HSBC Income Fund (HIF) an open-ended Income Scheme HIF seeks to generate reasonable income through a diversified portfolio of fixed income securities. The AMC s view of interest rate trends and the nature of the plans will be reflected in the type and maturities of securities in which the Short Term and Investment Plans are invested. The Scheme has two plans the Investment Plan and the Short Term Plan. The net assets of HSBC Income Fund Investment Plan (HIF IP) amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 95.44% of the net assets was invested in debt and money market instruments, 3.20% of the net assets was invested in reverse repos/cblo and 1.36 % was in net current assets as at March 31, The net assets of HSBC Income Fund Short Term Plan (HIF STP) amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 97.15% of the net assets were invested in debt and money market instruments, 0.79% of the net assets were invested in reverse repos/cblo and 2.06% were in net current assets as at March 31, HIF-IP outperformed its benchmark due to higher duration calls taken during the year. The stable government and low volatility in forex market created environment for foreign investors to invest in fixed income segment which benefitted the rates and spread scenario. HIF-STP underperformed its scheme benchmark due to lower duration calls taken during the year. RBI restricted short end investment (upto 3 year) by Foreign Portfolio investors which affected short end levels. HIF IP Date Of Inception : 10 Dec 02 Simple Annualized Scheme Name & Benchmarks April 14 - March 15 HSBC Income Fund - Investment Plan Growth Crisil Composite Bond Fund Index (Scheme Benchmark) Crisil 10 Year Gilt Index (Standard Benchmark) April 13 - April 12 - March 14 March Compounded Annualized Since Inception Rs. 10,000, if invested in HIF - IP, 11,488 10,185 11,119 23,801

11 Date Of Inception : 10 Dec 02 Simple Annualized Scheme Name & Benchmarks April 14 - would have become Rs. 10,000, if invested in Crisil Composite Bond Fund Index, would have become Rs. 10,000, if invested in Crisil 10 Year Gilt Index, would have become HIF STP Date Of Inception : 10 Dec 02 March 15 April 13 - March 14 April 12 - March 13 11,460 10,434 10,927 21,505 11,458 9,921 11,131 19,971 Simple Annualized Compounded Annualized Since Inception Compounded Annualized Scheme Name & Benchmarks April 14 - April 13 - April 12 - Since March 15 March 14 March 13 Inception HSBC Income Fund - S T P Growth Crisil Short Term Bond Fund Index (Scheme Benchmark) Crisil 1 Year T-Bill Index (Standard Benchmark) Rs. 10,000, if invested in HIF -ST, 10,995 10,723 10,926 23,138 would have become Rs. 10,000, if invested in Crisil Short Term Bond Fund Index, would have become 11,033 10,879 10,909 22,828 Rs. 10,000, if invested in Crisil 1 Year T-Bill Index, would have become 10,874 10,578 10,837 19,797 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (i) HSBC Gilt Fund (HGF) an open-ended Gilt Scheme HGF seeks to generate reasonable returns through investments in Government Securities of various maturities. The AMC s view of interest rate trends will be reflected in the maturities of securities in which the scheme is invested. 10

12 The net assets of HGF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 89.28% of the net assets was invested government securities, 8.55% was invested in reverse repos/cblo and 2.17 % was in net current assets as at March 31, HGF outperformed its benchmark due to higher duration calls taken during the year. The stable government and low volatility in forex market created environment for foreign investors to invest in fixed income segment which benefitted the rates and spread scenario. Date Of Inception : 05 Dec 03 Simple Annualized Compounded Annualized Scheme Name & Benchmarks April 14 - April 13 - April 12 - Since March 15 March 14 March 13 Inception HSBC Gilt Fund Growth I-Sec Composite Bond Fund Index (Scheme Benchmark) Crisil 10 Year Gilt Index (Standard Benchmark) Rs. 10,000, if invested in HGF, 11,635 10,199 11,237 17,970 would have become Rs. 10,000, if invested in I-Sec 11,568 10,395 11,171 22,146 Composite Bond Fund Index, would have become Rs. 10,000, if invested in Crisil 10 Year Gilt Index, would have become 11,458 9,921 11,131 17,524 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (j) HSBC Floating Rate Fund Long Term Plan (HFRF LTP) an open-ended Income Scheme HFRF seeks to generate reasonable return with commensurate risk from a portfolio comprised of floating rate debt instruments and fixed rate debt instruments swapped for floating rate returns. The scheme may also invest in fixed rate money market and debt instruments. The net assets of the HFRF - LTP amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 95.99% of the net assets was invested in money market instruments, 7.96% was invested in reverse repos/cblo and (-3.95%) was in net current assets as at March 31, HFRF-LTP underperformed the benchmark due to lower duration calls taken by fund and larger movement in duration segment. RBI restricted short end investment (upto 3 year) by Foreign Portfolio investors which affected short end levels. 11

13 Date Of Inception : 16 Nov 04 Simple Annualized Compounded Annualized Scheme Name & Benchmarks April 14 - April 13 - April 12 - Since March 15 March 14 March 13 Inception HSBC FRF - LTP Growth Crisil Liquid Fund Index (Scheme Benchmark) Crisil 1 Year T-Bill Index (Standard Benchmark) Rs. 10,000, if invested HFRF - 10,873 10,921 10,917 21,761 LTP, would have become Rs. 10,000, if invested in Crisil 10,897 10,946 10,822 20,485 Liquid Fund Index, would have become Rs. 10,000, if invested in Crisil 1 Year T-Bill Index, would have become 10,874 10,578 10,837 18,243 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (k) HSBC Cash Fund (HCF) an open-ended Liquid Scheme* HCF aims to provide reasonable returns, commensurate with low risk while providing a high level of liquidity, through a portfolio of money market and debt securities. The net assets of HCF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, The entire net asset remains invested in debt and money market instruments including reverse repos/cblo as at March 31, HCF performed in line with its benchmark for a year due to conservative investments in line with the internal group guidelines and the focus being on accruals and credits. Date Of Inception : 04 Dec 02 Scheme Name & Benchmarks HSBC Cash Fund Growth Simple Annualized Last 7 Days as on 31 March 2015 Last 15 Days as on 31 March Last 30 Days as on 31 March 2015 April 14 - March 15 April 13 - March Compounded Annualized Since Inception

14 Date Of Inception : 04 Dec 02 Scheme Name & Benchmarks Crisil Liquid Fund Index (Scheme Benchmark) Crisil 91 Day T-Bill Index (Standard Benchmark) Rs. 10,000, if invested in HCF, would have become Rs. 10,000, if invested in Crisil Liquid Fund Index, would have become Rs. 10,000, if invested in Crisil 91 Day T-Bill Index, would have become Simple Annualized Last 7 Days as on 31 March 2015 Last 15 Days as on 31 March 2015 Last 30 Days as on 31 March 2015 April 14 - March 15 April 13 - March ,020 10,039 10,073 10,895 10,942 13,948 10,026 10,043 10,079 10,897 10,946 13,869 10,025 10,042 10,075 10,884 10,855 13,664 Compounded Annualized Since Inception Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. * Pursuant to SEBI circular dated Sept 13, 2012, certain plans/options within the schemes have been discontinued to comply with a single plan structure. Since there was no continuous NAV history available for the surviving plan prior to 19 May 2011, returns since the said date have been considered for calculating performance. The inception date of HSBC Cash Fund however is December 04, (l) HSBC Ultra Short Term Bond Fund (HUSBF) an open ended Debt Scheme HUSBF seeks to provide liquidity and reasonable returns by investing primarily in a mix of short term debt and money market instruments. The net assets of HUSBF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 97.58% of the net assets was invested in debt and money market instruments, 5.30% was invested in reverse repos/cblo and (-2.88%) was in net current assets as at March 31, HUSTBF underperformed its scheme benchmark due to lower duration view that the fund takes and larger movement in duration segment. RBI restricted short end investment (upto 3 year) by Foreign Portfolio investors which affected short end levels. 13

15 Date Of Inception : 17 Oct 06 Simple Annualized Compounded Annualized Scheme Name & Benchmarks April 14 - April 13 - Since Inception March 15 March 14 HSBC Ultra Short Term Bond Fund - Growth $ Customised Benchmark Index Fund (Scheme Benchmark)* Crisil 1 Year T-Bill Index (Standard Benchmark) Rs. 10,000, if invested in HUSTBF, 10,904 10,904 21,584 would have become Rs. 10,000, if invested in Customised 10,911 10,860 21,676 Benchmark Index, would have become Rs. 10,000, if invested in Crisil 1 Year T- Bill Index, would have become 10,874 10,578 19,042 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. $Pursuant to SEBI circular dated Sept 13, 2012, certain plans/options within the schemes have been discontinued to comply with a single plan structure. Since there was no continuous NAV history available for the surviving plan prior to 1 October 2012, returns since the said date have been considered for calculating performance Since Inception. The inception date of HSBC Ultra Short Term Bond Fund however is October 17, *Composite index of Crisil Liquid Fund Index (90%) and Crisil Short Term Bond Fund Index (10%). (m) HSBC Flexi Debt Fund (HFDF) an open ended Debt Scheme HFDF seeks to deliver returns in the form of interest income and capital gains, along with high liquidity, commensurate with the current view on the markets and the interest rate cycle, through active investment in debt and money market instruments. The net assets of HFDF amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 98.13% of the net assets was invested in debt and money market instruments, 0.48% was invested in reverse repos/cblo and 1.39% was in the net current assets as at March 31, HFDF performed in line with the its benchmark due to higher duration calls in rates during the year as progressive reduction in inflation and commodity prices, stability in government created conducive environment for rate cuts. The stable government and low volatility in forex market created environment for foreign investors to invest in fixed income segment which benefitted the rates and spread scenario. 14

16 Date Of Inception : 05 Oct 07 Simple Annualized Scheme Name & Benchmarks April 14 - March 15 Compounded Annualized Since Inception April 13 - April 12 - March 14 March 13 HSBC Flexi Debt Fund Growth Crisil Composite Bond Fund Index (Scheme Benchmark) Crisil 10 Year Gilt Index (Standard Benchmark) Rs. 10,000, if invested in HFDF, 11,456 10,369 11,126 19,314 would have become Rs. 10,000, if invested in Crisil 11,460 10,434 10,927 17,294 Composite Bond Fund Index, would have become Rs. 10,000, if invested in Crisil 10 Year Gilt Index, would have become 11,458 9,921 11,131 16,210 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (n) HSBC MIP (HMIP) an open-ended Fund (Monthly income is not assured and is subject to availability of distributable surplus.) HMIP is an open-ended fund which seeks to generate reasonable returns through investments in Debt and Money Market Instruments. The secondary objective of the scheme is to invest in equity and equity related instruments to seek capital appreciation. The scheme offers two plans: Regular Plan and Savings Plan. The Regular Plan can have up to 15% of the corpus invested in equities while the Savings Plan can have up to 25 % invested in equities. The net assets of HMIP Regular Plan (HMIP R) amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 82.79% of the net assets were invested in debt and money market instruments, 13.58% of the net assets was invested in equities and 3.63% was in net current assets as at March 31, The net assets of HMIP Savings Plan (HMIP S) amounted to Rs crores as at March 31, 2015 as compared to Rs crores as at March 31, Around 72.94% of the net assets were invested in debt and money market instruments, 23.56% of the net assets were invested in equities and 3.63% were in net current assets as at March 31, MIP-R underperformed its benchmark due to lower duration view that the fund takes and larger movement in duration segment. Further, the underperformance of MIP-R was also due to lower exposure in equity. 15

17 MIP-S outperformed its benchmark due to higher duration calls in rates during the year as progressive reduction in inflation and commodity prices, stability in government created conducive environment for rate cuts. Higher exposure in Equity also helped outperformance. HMIP Regular Plan Date Of Inception : 24 Feb 04 Simple Annualized 16 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC MIP - Regular Plan Growth Crisil MIP Blended Index (Scheme Benchmark) Crisil 1 Year T-Bill Index (Standard Benchmark) Crisil 10 Year Gilt Index (Standard Benchmark) Rs. 10,000, if invested in HMIP - 11,560 10,660 11,007 24,387 R, would have become Rs. 10,000, if invested in Crisil 11,642 10,642 10,909 23,346 MIP Blended Index, would have become Rs. 10,000, if invested in Crisil 1 Year T-Bill Index, would have become Rs. 10,000, if invested in Crisil 10 Year Gilt Index, would have become 10,874 10,578 10,837 18,585 11,458 9,921 11,131 17,381 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. HMIP Savings Plan Date Of Inception : 24 Feb 04 Simple Annualized Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC MIP - Savings Plan Growth Crisil MIP Blended Index (Scheme Benchmark) Crisil 1 Year T-Bill Index Compounded Annualized Since Inception

18 Date Of Inception : 24 Feb 04 Simple Annualized Scheme Name & Benchmarks April 14 - (Standard Benchmark) Crisil 10 Year Gilt Index (Standard Benchmark) Rs. 10,000, if invested in HMIP - S, would have become Rs. 10,000, if invested in Crisil MIP Blended Index, would have become Rs. 10,000, if invested in Crisil 1 Year T-Bill Index, would have become Rs. 10,000, if invested in Crisil 10 Year Gilt Index, would have become March 15 April 13 - March 14 April 12 - March ,857 10,899 11,074 29,112 11,642 10,642 10,909 23,346 10,874 10,578 10,837 18,585 11,458 9,921 11,131 17,381 Compounded Annualized Since Inception Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (o) HSBC Fixed Term Series a close ended Income Scheme The scheme seeks to generate returns by investing in a portfolio of fixed income instruments which mature on or before the maturity date of the plans under the scheme. Details of scheme launched during the period Scheme Name Date of Launch HSBC Fixed term Series 102 April 28, 2014 Details of schemes rolled-over during the period Scheme Name Date of roll-over HSBC Fixed term Series 91 August 05, 2014 HSBC Fixed term Series 94 August 26, 2014 HSBC Fixed term Series 96 September 05, 2014 HSBC Fixed term Series 98 October 21, 2014 Being close ended fixed maturity plans, the performance of these schemes are not provided. 17

19 (p) HSBC Capital Protection Oriented Fund a close ended Capital Protection Oriented Scheme The scheme seeks protection of capital by investing a portion of the portfolio in high quality debt securities and money market instruments and also to provide capital appreciation by investing in equities through NIFTY (Index) Call Options. During the year, the scheme launched two plans namely, HSBC Capital Protection Oriented Fund Series II Plan I and HSBC Capital Protection Oriented Fund Series II Plan II having tenure of 1195 days and 1173 days respectively. HSBC Capital Oriented Protection Fund Series II Plan I was launched on March 17, 2015 and HSBC Capital Protection Oriented Fund Series II Plan II was launched on April 6, The performances of the schemes are benchmarked against CRISIL MIP Blended Index. Being close ended schemes, the performance of the scheme is not provided. Fund of Funds Schemes (q) HSBC Emerging Markets Fund (HEMF) - an open-ended Scheme HEMF seeks to provide long term capital appreciation by investing in India and in the emerging markets, in equity and equity related instruments, share classes and units/securities issued by overseas mutual funds or unit trusts. The fund may also invest a limited proportion in debt and money market instruments. The net assets of HEMF amounted to Rs crores as at March 31, 2015 compared to Rs crores as at March 31, Around 97.93% of the net assets were invested in HSBC GEM Equity Fund (overseas mutual fund), 2.93% of the net assets were invested in reverse repos/cblo and (- 0.86%) was in the net current assets as at March 31, Despite of INR deprecation, the underlying fund under-performed its benchmark due to combination of allocation and stock selection. Date Of Inception : 17 Mar 08 Absolute 18 Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Emerging Markets Fund Growth MSCI Emerging Market Index (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HMEF, 10,455 10,394 10,455 11,426 would have become Rs. 10,000, if invested in MSCI 10,764 10,081 10,177 11,641 Emerging Market Index, would have become Rs. 10,000, if invested in CNX Nifty, would have become 12,633 11,753 10,693 18,866

20 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (r) HSBC Brazil Fund (HBF) - an open ended Fund of Funds Scheme HBF seeks to provide long term capital appreciation by investing predominantly in units/shares of HSBC Global Investments Funds (HGIF) Brazil Equity Fund. The Scheme may, at the discretion of the Investment Manager, also invest in the units of other similar overseas mutual fund schemes, which may constitute a significant part of its corpus. The scheme may also invest a certain proportion of its corpus in money market instruments and /or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time. The net assets of HBF amounted to Rs crores as at March 31, 2015 compared to Rs crores as at March 31, Around % of the net assets were invested in HSBC Brazil Equity Fund (overseas mutual fund), 3.63% of the net assets were invested in reverse repos/cblo and (- 2.74%) were in the net current assets as at March 31, HBF outperformed its scheme benchmark during the period mainly on account of depreciation of the INR vis-à-vis the USD. Date Of Inception : 06 May 11 Absolute Compounded Annualized Since Inception Scheme Name & Benchmarks April 14 - April 13 - April 12 - March 15 March 14 March 13 HSBC Brazil Fund Growth MSCI Brazil 10/40 Index (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HBF, 7,115 8,863 9,750 6,104 would have become Rs. 10,000, if invested in MSCI 7,063 8,554 8,547 4,630 Brazil 10/40 Index, would have become Rs. 10,000, if invested in CNX Nifty, would have become 12,633 11,753 10,693 15,300 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. 19

21 (s) HSBC Asia Pacific (Ex Japan) Dividend Yield Fund (HAPDF) an open ended Fund of Funds Scheme HAPDF seeks to provide long term capital appreciation by investing predominantly in units of HSBC Global Investment Funds (HGIF) Asia Pacific Ex Japan Equity High Dividend Fund (HEHDF). The Scheme may, also invest a certain proportion of its corpus in money market instruments and / or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time. However, there is no assurance that the investment objective of the Scheme will be achieved. The net assets of HADPF amounted to Rs crores as on March 31, 2015 as compared to crores as at March 31, Around % of the net assets were invested in HSBC Global Investment Funds (HGIF) Asia Pacific Ex Japan Equity High Dividend Fund (overseas mutual fund), 2.38% of the net assets were invested in reverse repos/cblo and (-0.77%) were in the net current assets as at March 31, HAPDF outperformed its scheme benchmark during the period mainly on account of depreciation of the INR vis-à-vis the USD and stock selection. Date Of Inception : 24 Feb 14 Absolute Compounded Annualized Scheme Name & Benchmarks April 14 - March 15 Since Inception HSBC Asia Pacific (Ex Japan) Dividend Yield Fund Growth MSCI AC Asia Pacific ex Japan (Scheme Benchmark) CNX Nifty (Standard Benchmark) Rs. 10,000, if invested in HAPDF, would have 10,687 10,559 become Rs. 10,000, if invested in MSCI AC Asia Pacific ex 10,265 10,598 Japan, would have become Rs. 10,000, if invested in CNX Nifty, would have become 12,633 13,737 Past performance may or may not be sustained in future. Returns data as on March 31, Data for the period April to March has been considered in all cases, except for Since Inception. Since Inception returns are calculated on Rs. 10 invested at inception. Standard benchmark is prescribed by SEBI for long term equity schemes and is used for comparision purposes. Returns on Rs. 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be a minor difference between pointto-point returns vis-à-vis returns indicated above. Calculations are based on Growth NAVs. (t) HSBC Managed Solution (HMS) an open ended Fund of Funds Scheme HMS seeks to provide long term total return primarily by seeking capital appreciation through an active asset allocation with diversification commensurate with the risk profile of investments by investing predominantly in units of equity mutual funds as well as in a basket of debt mutual funds gold exchange traded funds (ETFs) and other ETFs, offshore mutual funds and money market instruments. The scheme has three plans namely, HMS Growth Plan, HMS Moderate Plan and HMS Conservative Plan. 20

22 The scheme was launched on April 09, The performance of HMS Growth Plan is benchmarked against Composite Index constituting 80% of BSE 200 Index and 20% of CRISIL Composite Bond Index while the performance of HMS Moderate Plan is benchmarked against CRICIL Balanced Fund Index. The performance of HMS Conservative Plan is benchmarked against Composite Index constituting of 90% into CRISIL Composite Bond Index and 10% of BSE 200 Index. The performance data has not been provided since the scheme had not completed 1 year period as on March 31, (u) HSBC Global Consumer Opportunities Fund (HGCOF) - an open ended Fund of Funds Scheme HGCOF seeks to provide long term capital appreciation by investing predominantly in units of HSBC Global Investment Funds (HGIF) China Consumer Opportunities Fund (Underlying scheme). The Scheme may also invest a certain proportion of its corpus in money market instruments and/or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time. The scheme was launched on February 02, The performance of the scheme is benchmarked against MSCI AC World Index. The performance data has not been provided since the scheme had not completed 1 year period as on March 31, INVESTOR SERVICES The number of official points of acceptance of transactions is 197 locations. In addition to the offices of the Registrar & Transfer agents, the AMC has Investor Service Centres in 5 locations at its own offices - namely Mumbai, New Delhi, Kolkata, Bangalore and Chennai. With a view to enhance customer convenience, the AMC has extended the facility of priority based servicing to key distributors through the enhancement of the Interactive Voice Reponses. Call Center number has now been converted to a single Toll Free number which can be dialed from anywhere in India. The call center service is being managed by the Registrar and Transfer Agents. The AMC continues to retain the outsourced back office services with HSBC Electronic Data Processing India Private Limited. On the distribution front, the number of empanelled distributors was 463 as on March 31, During the year, the AMC initiated tie-ups for online distribution of the Mutual Fund s schemes with several channel partners taking the total number of such tie-ups to EXTRACT OF ANNUAL RETURN The details forming part of the extract of the Annual Return in form MGT 9 is annexed below as Annexure A. 8. BOARD MEETINGS During the financial year , five meetings of the Board of Directors of the Company were held on the following dates: Date of Board Meeting June 06, 2014 Directors present Ms. Naina Lal Kidwai Mr. Dinesh Mittal Ms. Kishori Udeshi 21

23 Date of Board Meeting Directors present Mr. S. P. Mustafa June 16, 2014 August 11, 2014 November 26, 2014 February 11, 2015 Ms. Naina Lal Kidwai Mr. Dinesh Mittal Ms. Kishori Udeshi Mr. S. P. Mustafa Mr. Puneet Chaddha Ms. Naina Lal Kidwai Ms. Kishori Udeshi Mr. S. P. Mustafa Mr. Puneet Chaddha Ms. Naina Lal Kidwai Mr. Dinesh Mittal Ms. Kishori Udeshi Mr. S. P. Mustafa Mr. Puneet Chaddha Ms. Naina Lal Kidwai Ms. Kishori Udeshi Mr. S. P. Mustafa Mr. Puneet Chaddha 9. DIRECTORS' RESPONSIBILITY STATEMENT The Directors of your Company confirm: i. that the applicable accounting standards have been followed in the preparation of the annual accounts and that there are no material departures; ii. that such accounting policies have been selected and applied consistently and judgments and estimates made are reasonable and prudent, so as to give a true and fair view of the state of affairs of the Company at March 31, 2015 and of the profit of the Company for the year ended on that date; iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 to safeguard the assets of the Company and to prevent and detect fraud and other irregularities; iv. that the annual accounts have been prepared on a going concern basis; and v. that proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively 10. LOANS OR GUARANTEES The Company has not provided any loans or guarantees under the provisions of section 186 of the Companies Act,

24 11. CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES During the year under review, the Company has entered into contracts or arrangements with related parties pursuant to section 188 of the Companies Act, Details of contracts in form of AOC-2 are annexed below as Annexure B. 12. CONSERVATION OF ENERGY TECHNOLOGY ABORPTION, EXPORT & FOREIGN EARNING AND OUTGO As the Company is the Asset Management Company to HSBC Mutual Fund and provides portfolio management services, no reporting in respect of conservation of energy and technology absorption is required. Information regarding foreign exchange earnings and outgo is provided in points 20.2 and 20.3 of the Notes to the financial statements. 13. RISK MANAGEMENT POLICY The integrated Risk Management framework of the Company is as follows: Independent function Global best practices Sound process orientation Audited approach Robust Governance structure Risk Governance Risk Identification Risk Adjusted Performance Measurement Integrated Risk Management Risk Measurement Risk Monitoring Management 23