Structural Reforms in India 2012 2014 2015 2016 2017 UIDAI launched online verification and issuance of Aadhaar Card, Direct Benefit Transfer based on Aadhaar Card initiated. Launch of Jan Dhan Programme. India s Mission for Financial Inclusion. Pradhan Mantri Awas Yojana launched with aim to provide affordable housing for economic weaker section. Demonetization: Rs.500 and Rs.1000 bank notes ceased to be legal tender. Implementation of Goods & Service Tax. Issuance of Bank Recapitalization Bonds. Announcement of Bharatmala and Sagarmala Project. Source: www.india.gov.in. UIDAI: Unique Identification Authority of India 2
Reforms That May Impact Bharat Building Bharatmala Building Sagarmala Housing For All Digital India One Nation One Tax: Goods & Services Tax (GST) Electrifying Rural India Recapitalization of Indian Public Sector Banks 3
Investment Opportunities Build Bharat Financing Bharat Rural Bharat Opportunity to Invest in Rising Bharat The asset allocation and investment strategy of the scheme is subject to the provisions of the Scheme Information Document. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s). 4
Build Bharat: Government s Thrust on Infrastructure Mega Highway Project of building ~83,000 km roads over the next 5 yrs. Capex Outlay of Rs. 6.92 lac crore 3500 km of Railway lines to be commissioned in FY-18 with Rs 1.31 lakh crore. 24,200 Railway lines to be electrified by FY-21 covering 90% of total route. PMAY Urban: 1.02 cr units to be built PMAY Rural: 1.2 cr. Units to be built. Total outlay of Rs 0.31 lac crore Electrification of ~40 mn. households by FY-18 under Saubhagya Scheme. Total outlay of Rs 0.16 lac crore. Source: Macquerie Research Oct 2017; PMAY: Pradhan Mantri Awas Yojana. 5
Build Bharat In FY 17, projects awarded for 16,271 km. (66% higher from previous peak of FY12). Future orders are expected to be around 16000 km/year over the next 2-3 years. 2,100 km of coastal roads expected to be built connecting coasts of India. Sagarmala Project will require 27 mn mt of cement, using approx. 7% of installed capacity Awarding Activity has registered 55% growth YoY Construction Activity has registered 35% growth YoY 27 Awarded Km(per day) 22 29 45 14 Construction Km(per day) 16 17 12 12 23 5 9 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 FY 12 FY 13 FY 14 FY 15 FY 16 FY 17 Source: India s Road Sector Report by JM Financial Reseach, Oct 24 th 2017. MORTH: Ministry Of Roads Transportation Highways, NHAI : National Highway authority of India, PMGSY: Pradhan Mantri Gram Sadak Yojana 6
Build Bharat Steam left in Metals Prices of metals (Zinc, Nickel, Aluminum, etc) have seen a sharp recovery in last few quarters. ($) 12000 Copper 10000 8000 Despite recent run-up metal prices are still below its previous highs. 6000 4000 2000 The recent policy action on global front, like China shutting down production in metal sector, may lead to demand supply mismatch and can help domestic companies in related sector. Government initiative on Infrastructure spending like Bharatmala, Housing for all etc. also makes a case for investment in metal sector. 0 5000 4500 4000 3500 3000 2500 2000 1500 1000 500 0 ($) Nickel Sources : Internal. Past Performance may or may not sustain in future. 7
Sectors To Be Impacted By Build Bharat STEEL CEMENT Tata Steel JSW Steel ACC Shree Cement POWER Cummins India Triveni Turbine Power Grid Corporation BUILD BHARAT CONSTRUCTION PROJECTS Larsen & Turbo PNC Infratech The stocks/sectors mentioned in this slide is only for illustration purpose only. The stocks mentioned herein are a part of the scheme benchmark i.e. S&P BSE 500 Index. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s).the portfolio of the scheme is 8 subject to changes within the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors.
Rural Bharat Rural India accounts for over 65% of the total population. Real Rural Wage Rate Growth (%) Growth in India s rural economy (~47% of country s income and 54% of country s expenditure) has slowed over the past four years. While a poor monsoon impacted the rural economy negatively in 2014 and 2015, a sharp decline in food prices impacted farming incomes in 2016. With trend reversal in Rural wage data on account of government efforts coupled with good monsoon last year, Rural consumption is expected to improve. Source: Deutsche Bank, Reserve Bank of India. 9
Initiatives Impacting Rural Bharat PMKSY has been approved for implementation across the country with an outlay of Rs. 50,000 crore in five years (2015-2020). PMAY Gramin, GoI plans to spend Rs 81975 crore between 2016-2019. Rs 16,320-crore scheme to supply electricity to all households by December 2018 Implementation of PMFBY led to increase in gross coverage area from 25% in FY 2016 to 30% in FY 2017 E-market platform for transparent commodity transactions, It is expected that farmers transacting through here will get better pricing power. RURAL ECONOMY Source: PIB.nic.in, PMKSY - Pradhan Mantri Krishi Sinchayee Yojana 10
Changing Consumption Pattern India s nominal YoY expenditure growth of 12% is more than double the anticipated global growth of 5% India is expected to become third largest consumer market by 2025. Emerging cities is expected to see the highest growth among elite and affluent household by 2025. It is expected that around 120 cities can match todays metropolitan area in average household income. Affluence can be Much More Widespread by 2025 Source : BCG Analysis, Customer Segments were defined on the basis of annual household income: elite > $ 30,800; affluent = $15,400 to $30,800 11
Sectors To Be Impacted By Rural Bharat Mahindra & Mahindra Maruti PI Industries Pidilite Industries Ltd Auto Rural Bharat Chemicals Voltas Ltd Whirpool of India VIP Industries ITC Britannia Industries Hindustan Unilever Ltd Consumer Durables Consumption The stocks/sectors mentioned in this slide is only for illustration purpose only. The stocks mentioned herein are a part of the scheme benchmark i.e. S&P BSE 500 Index. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s).the portfolio of the scheme is subject to changes within the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors. 12
Financing Bharat Larger than Expected Recapitalization Plan Positive for Public Sector Banks Recapitalization plan of Rs. 2.11 trn to revitalize the PSBs struggling with high levels of NPAs. We believe this is positive for state owned banks as two key constraints of loan growth and capital shortage are addressed by recapitalization of PSBs With this recapitalization, the banks are expected to meet any new borrowing requirement of infrastructure led companies. Housing for all by 2022 could have a positive impact on Housing Finance and Banking Sector. Good monsoon coupled with green shoots visible in rural consumption may create demand in sectors like vehicle financing and others Source: PIB; Motilal Oswal Securites Report; NPA Non-Performing Assets 13
Financing Bharat Capacity Utilization in (%) 90.0 Long Term Average 86.3 82.2 82.6 79.2 73.8 73.5 73.3 74.1 73.5 67.7 72.8 69.0 68.8 70.2 72.6 The capacity utilization is below the long term average of 76%. As demand increases, the corporates may look to increase its capacity. Source: Kotak Securities 14
Sectors To Be Impacted By Financing Bharat SBI Bank of Baroda ICICI Bank Banks Financing Bharat NBFC Muthoot Finance Magma Fincorp M&M Finance Services Manappuram Finance Auto Finance Micro Finance The stocks/sectors mentioned in this slide is only for illustration purpose only. The stocks mentioned herein are a part of the scheme benchmark i.e. S&P BSE 500 Index. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s).the portfolio of the scheme is subject to changes within the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors. 15
Set Stage for Future Growth 16
Set Stage For Future Growth 1981 21.3% CAGR 1990 Assassination of the Prime Minister & Asian Debt Crisis. 1991 14.2% CAGR 2000 Trade Liberalization, 6 Prime Ministers, Coalition Govts. Harshad Mehta s Scam. 2001 17.8% CAGR 2010 Coalition Govts, Global Financial Crisis. 2011 7.40% CAGR 2017* Reform Oriented Stable Government. Current Decade: India, One of the Fastest growing and large economies with strong domestic demand but low decadal returns so far. Source: MFI Explorer. Returns are of S&P BSE Sensex. 1 st working day for Start of the Year and Last working day for end of the year. Returns are in CAGR. *2017 returns are as on 31 st Dec 2017. Past Performance may or may not sustain in future. 17
To Benefit From Opportunities Arising Due To Rising Bharat, Invest In NFO Period : January 17th, 2018 to January 31st, 2018 Fund Managers*: S. Naren, Vinay Sharma & Mittul Kalawadia *Priyanka Khandelwal for investment in ADR/GDR/ Foreign securities. 18
ICICI Prudential Value Fund Series 20 (1262 days close ended scheme) Themes that can benefit from government reforms like Infra, banking & finance and rural consumption that are likely to play out well with ~3.5 years investment horizon Helps in bottom-up stock selection with clear ~3.5 years view Ability to reduce net equity risk at market peaks Aims to limit downside of the portfolio by using hedging strategies The asset allocation and investment strategy of the scheme is subject to the provisions of the Scheme Information Document. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s). 19
Track Record of Scheme Completed 3 Years Investment Amount of Rs.10,00,000/- during NFO(New Fund offer) Scheme Name Launch Date No of Dividend Declared since inception Dividend Received Valuation as on 4 th Jan 2018 ICICI Prudential Value Fund - Series 1 07-Nov-13 10 7,95,000 14,90,000 ICICI Prudential Value Fund - Series 2 06-Dec-13 10 8,00,000 13,92,000 ICICI Prudential Value Fund - Series 3 20-Mar-14 10 8,00,000 12,46,000 ICICI Prudential Value Fund - Series 4 08-May-14 8 8,00,000 12,23,000 ICICI Prudential Value Fund - Series 5 10-Sep-14 3 2,25,000 12,57,000 Payment of dividend is subject to availability of distributable surplus and Trustee approval. It should be noted that pursuant to payment of dividend, the NAV of the plan/dividend option of the Scheme would fall to the extent of dividend payout and statutory levy, if any Past performance may or may not sustain in future. For more information on dividend kindly refer our website: www.icicipruamc.com 20
ICICI Prudential Value Fund Series 20 Features Tenure :1262 days NFO Period :17th January 2018 to 31st January 2018 MICR cheques :Till end of business hours on 31st January 2018 RTGS and transfer cheques :Till end of business hours on 31st January 2018 Switches :Switches from equity schemes and other schemes - 31st January 2018; Till cut off time (specified for switch outs in the source scheme) Option to be launched :CICI Prudential Value Fund - Series 20 Cumulative & Dividend ICICI Prudential Value Fund - Series 20 Direct Plan Cumulative & Dividend Entry / Exit Load Minimum Application Amount Liquidity Benchmark Fund Manager* :Nil :Rs.5,000/- (plus in multiple of Rs.10) :To be listed :S&P BSE 500 Index :Sankaran Naren, Vinay Sharma & Mittul Kalawadia *Priyanka Khandelwal for investment in ADR/GDR/ Foreign securities. 21
Riskometer & Disclaimer ICICI Prudential Value Fund Series 20 is suitable for investors who are seeking:* Long term wealth creation A close-ended equity fund that aims to provide capital appreciation by investing in welldiversified portfolio of stocks through fundamental analysis. *Investors should consult their financial advisors if in doubt about whether the product is suitable for them. Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Disclaimer: All figures and data given in the document are dated unless stated otherwise. In the preparation of the material contained in this document, the AMC has used information that is publicly available, including information developed in-house. Some of the material used in the document may have been obtained from members/persons other than the AMC and/or its affiliates and which may have been made available to the AMC and/or to its affiliates. Information gathered and material used in this document is believed to be from reliable sources. The AMC however does not warrant the accuracy, reasonableness and / or completeness of any information. We have included statements / opinions / recommendations in this document, which contain words, or phrases such as will, expect, should, believe and similar expressions or variations of such expressions, that are forward looking statements. Actual results may differ materially from those suggested by the forward looking statements due to risk or uncertainties associated with our expectations with respect to, but not limited to, exposure to market risks, general economic and political conditions in India and other countries globally, which have an impact on our services and / or investments, the monetary and interest policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices etc. The AMC (including its affiliates), the Mutual Fund, the trust and any of its officers, directors, personnel and employees, shall not liable for any loss, damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this material in any manner. The recipient alone shall be fully responsible/are liable for any decision taken on this material. The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s). Past performance may or may not be sustained in the future. The portfolio of the scheme is subject to changes within the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors. Investors are advised to consult their own legal, tax and financial advisors to determine possible ICICI Prudential Mutual Fund. tax, legal and other financial implication or consequence of subscribing to the units of 22
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