MD & CEO - ICICI Directcontent.icicidirect.com/MoneyManagerMagazine/April_2016.pdf · This will bring down the returns. Lower interest rates are correlated to lower inflation

7

Anup BagchiMD & CEO

ICICI Securities Ltd.

Interest rates play an important role in the economy as well as in your personal finances. The Reserve Bank of India (RBI) r e g u l a r l y m o n i t o r s macroeconomic conditions and uses its monetary policies to stimulate growth or slow down an overheated economy. When RBI increases interest rates, it is an effort to restrict spending in the economy and curb inflation expectations. On the other hand, when it decreases, RBI strives to encourage economic activity and stimulate growth. Both rising and falling interest rates affect everything right down to your savings and investments.

We are in a falling interest rate environment, with RBI cutting repo rate (the rate at which banks borrow from the central bank) by a total of 150 basis points (bps) since January 2015, including the latest 25 bps cut in April 2016. There is a consensus that rates would fall further, thanks to easing inflation and normal monsoon forecast. So how do interest rates impact you and how should you prepare for falling interest rates ahead? Falling interest rates is positive for growth overall, but is also negative for investors who are dependent on interest income.

If falling interest rates create a surplus in your savings, it is a good idea to pay off your high-interest loans. Credit card bills can go first, followed by personal loans, car and consumer durable loans, education loans and home loans. It is also likely that your

1ICICIdirect Money Manager April 2016

debt, especially long term debt investments may see an appreciation. This is a good opportunity to review your investment's asset-allocation and rebalance to the target.

Decline in interest rates also helps equity markets since they reduce the overall cost of doing business in an economy, which in turn improves margins and profitability of companies. It also positively impacts the revenues of companies since lower interest rates provide impetus to consumption. So it is a good time to view your stock portfolio in this light.

Lower interest rates is a major concern for senior citizens and retirees, as they rely heavily on fixed-income producing investments (in the form of regular interest payouts) to meet their monthly commitments.Interest rates on small savings schemes have also got cut recently, in the range of 60 and 130 bps, across schemes. The rates on these schemes have now become market linked and will be reset every quarter. This will bring down the returns. Lower interest rates are correlated to lower inflation expectations. Therefore part of the decrease in interest income will be absorbed by lower than expected expenses. However, it is likely that as we grow as a stronger economy, interest rates will soften further. The cost of capital and interest rates reflect the macroeconomic situation and confidence of the investors all over the world. Retirees will therefore need to look at more sophisticated investment strategies, than just relying on bank deposits or other debt instruments. Their portfolios will need to have a mix of growth and income.

At ICICIdirect, we remain committed to help you with your finances and investments at whatever stage of life you may be in. Our message remains the same “Keep investing and stay invested for your life goals.” Through this magazine and our website www.icicidirect.com we want to make an earnest attempt to partner with you in setting and achieving your financial goals. Give us an opportunity to serve you, walk into any of your Neighbourhood Financial Superstore and talk to us.

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Interest rates are one of the important macroeconomic indicators

that affect our investments. They keep rising and falling and these

changes can significantly affect both equity and debt investments. In

case of equity, rising interest rates have a direct impact on the

company's profitability and may negatively affect their stock

performance, while lower interest rates reduce the overall cost of

doing business in an economy, aiding growth. Whereas in case of

debt instruments, rising interest rates drive bond prices down and

falling rates drive them up, since they share an inverse relationship.

In all, a deeper understanding is warranted on interest rates and its

impact on investments to make better investment decisions. Our

cover story of this edition takes you through the fine details of

current interest rate environment and discusses investment options

that you may consider to better align your portfolio to interest rate

changes.

Further, with the latest repo rate cut and liquidity easing measures by

Reserve Bank of India (RBI), we seem to be at the end of easing

interest rate cycle. In this scenario, short-term debt funds look

attractive. Therefore, a good part of your funds can be routed to

good quality short-term debt funds. Read on more about our

recommended funds in Mutual Funds Analysis section. I am sure

you will find this issue on Interest Rates interesting.

The edition also covers an interview with Sankaran Naren, Chief

Investment Officer (CIO), ICICI Prudential Mutual Fund, who urges

investors to look at this market as an opportunity and advises

investors to stay invested for long term. So read on, stay updated

and involved. Do wr i te in wi th your feedback a t

[email protected] and share your thoughts.

Editor & Publisher : Abhishake Mathur, CFA

Coordinating Editor : Yogita Khatri

Editorial Board : Sameer Chavan, CWM®, Pankaj Pandey

CMEditorial Team : Nithyakumar VP CFP , Sachin Jain, Isha Bansal

Your magazine is now also available on www.magzter.com, a digital newsstand.

ICICIdirect Money Manager April 2016

3

MD Desk....................................................................................................1

Editorial.....................................................................................................2

Contents....................................................................................................3

News.........................................................................................................4

Asset Class InsightsA monthly review and outlook on major asset classes – equity, debt/fixed-income and gold…................................................................5

Stock Ideas: Greenply Industries and Majesco............................................ 11

Flavour of the Month: How to Align Your Portfolio to Current Interest Rate EnvironmentInterest rates in India have been trending lower and are currently at 5-year low. There is a consensus that rates would fall further. So how should you be aligning your portfolio to a low interest rate environment? Read on to find out....................................................... 20

Tête-à-tête: 'Good opportunity to build position in equities’An interview with Sankaran Naren - Chief Investment Officer (CIO), ICICI Prudential Mutual Fund…............................................................ 31

Ask Our Planner: Your personal finance queries answered….........................................35

Mutual Funds Analysis: Investing in Short-term Debt FundsWith the latest repo rate cut and liquidity easing measures by the RBI, short-term debt funds look attractive. Here are our top three recommended funds, which you may consider investing into..........39

Mutual Fund Top Picks..............................................................................51

Equity Model Portfolio...............................................................................52

Quiz Time................................................................................................ 57

Prime NumbersA revamped section of monthly trends, with inclusion of more data points and indicators............................................................................58

Premium Education Programmes Schedule.................................................62

Effect of new interest rates on small savings schemes


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Government rolls back restrictions on withdrawal of provident fund

Bowing to pressure from trade unions, the government has set aside the controversial provident fund (PF) withdrawal norms that had restricted complete withdrawal from PF account before the retirement age of 58 years. This is the second major stepback by the government on provident fund in less than two months and comes close on the heels of it withdrawing the budget announcement of imposing tax on withdrawal from Employee Provident Fund (EPF) account. "The withdrawal restriction imposed under the EPF scheme was at behest of trade unions but now since they don't want it we have withdrawn the notification dated February 10," labour secretary Shankar Agarwal said.

Courtesy: The Economic Times

The National Payments Corporation of India (NPCI) has unveiled the Unified Payments Interface (UPI), hailed as a next generation technology in the money transfer space that is set to completely revolutionise payments by making it as simple as sending a text message on a mobile phone. Under the new system, making payments has become simpler than other modes of online money transfer such as Immediate Payments Service (IMPS), National Electronic Funds Transfer (NEFT) or Real-time Gross Settlement (RTGS). Now, one can transfer money to another person through a unique virtual address (virtual addresses are aliases to a bank account allowing a customer's account to be uniquely mapped), or mobile number, or Aadhaar number. Customers do not need to know the payee's IFSC code, bank account details, etc, for transfer of up to Rs 1 lakh per transaction.

Courtesy: Business Standard

Now, transfer your money via SMS

capital markets regulator Securities and Exchange Board of India (Sebi) is trying to shorten the gap between an initial public offering (IPO) and the listing of shares to three days from the current six days, according to two people familiar with discussions held by the regulator. Reducing the time between an IPO and listing of shares helps limit risks related to market volatility, which may emerge within that period, and would bring closer to developed markets like the US where the time between an IPO and listing of shares is as low as one day.

Courtesy: Livemint

Sebi plans shorter gap between IPO and listing

Indian economy can grow at 8.5% in 2016-17: Arun JaitleyFinance minister Arun Jaitley said that India's economic growth this year could outpace estimates and accelerate to as much as 8.5% if the monsoon keeps its date with the country after back-to-back years of drought. India's economy could grow by 8-8.5% in 2016-17, if forecasts of normal monsoon rainfall prove correct, Jaitley said at the meeting organized by Citigroup Inc. The India Meteorological Department (IMD) last week projected monsoon rainfall this year at 106% of the long-term average after two consecutive years of below-normal rainfall in many parts of the country.

Courtesy: Livemint


5

Equity markets: Consolidation in sight after rebound… stock specific movement expectedIndian markets rebounded sharply in March 2016 on the back of a strong global market recovery and value buying at lower levels, particularly in beaten down sectors.

Indian markets recovered around 10% from the lows on the Union Budget day. Beaten down sectors like banking, real estate, capital goods and auto outperformed. The healthcare sector underperformed on the back of negative regulatory issues resulting into profit booking by many institutional investors.

Global markets also seem to have stabilised after a rebound in commodity prices, particularly crude oil. The further economic stimulus measures announced by the European Central Bank (ECB) and improving US economic data provided the much needed sentiment boost for global investors. Importantly, emerging markets witnessed

the return of foreign inflows with most emerging markets outperforming in March 2016 on rising expectation that the next hike in US interest rates could be somewhat delayed. The US dollar fell in value against all emerging market currencies indicating the risk on trade.

We expect the markets to enter a consolidation phase, going forward, to work off the overbought conditions developed after the strong rally in March. In the coming month, we expect the broader consolidation to pan out in the range of around 24000 to 26000 on Sensex levels while stock specific activity will remain in focus at the onset of quarterly earnings season. We believe any dips to form a higher bottom in the coming month should be used as an incremental buying opportunity. We do not foresee the benchmarks going below the near term base of around 24000 levels on BSE Sensex.

Markets have triggered a

ASSET CLASS INSIGHTS

Asset Class Insights: Equity, Fixed-income and Gold

A monthly review of the major asset classes - Equity, Fixed-Income and Gold -- and

a snapshot of our outlook.


6


positive structural turnaround during the current up move post Budget session bottom of 6825 as the index has posted faster retracement of a major falling segment for the first time in 13 months.

The Q4FY16 performance is likely to be subdued with the average topline of Sensex companies likely to grow ~2.4% YoY (year-on-year) while EBITDA (earnings before

interest, taxes, depreciation and amortization) is expected to report moderate growth of ~7.4%. The earnings growth is expected to be higher at 9.9% but will be aided by one-time boost from a couple of companies in the auto and p h a r m a s e c t o r. O n a normalised basis, net profit growth is likely to remain muted.


BSE Sensex rebounds sharply from lower levels,, may consolidate in near term

22000

24000

26000

28000

30000

Ap

r-15

Jun

-15

Au

g-1

5

Oc

t-1

5

De

c-1

5

Feb

-16

Ap

r-1

6

Source: Bloomberg

Global economy and markets: The

US Fed adopted a dovish rate

hike stance with market

expectations, as it flagged up

risks to the US economic

outlook from global factors like

plunging commodity prices,

haphazard policymaking in

China and concerns over

weaker global economic

growth. However, the Fed gave

a broadly positive assessment

of the US economy's

performance, noting that

inflation had picked up, the

l a b o u r m a r k e t w a s

strengthening and that the

economy had continued to

expand moderately, despite

the risks from overseas. The

US economy grew more

quickly than previously

7



thought in the final months of

last year, further dispelling

fears of an imminent

recession.

G l o b a l e q u i t y m a r k e t s regained a lot of ground in March, as investor confidence returned to the market. Emerging market equities led the way, producing a double-digit return over the month. The new-found optimism came in the wake of further economic stimulus measures announced by the European

Central Bank (ECB), improving US economic data and some respite from the downward spiral that had plagued oil prices.

Emerging equity markets had their best month since October 2011 during March 2016. Gains were led by Brazil as political deve lopments over rode economic news. Emerging market currencies appreciated against the US dollar as commodity prices rose.

Emerging markets outperform among global peers

17.0

11.

8

10

.2

7.1

5.0

4.6

1.3

0.7

15.

5

-15.

1

-3.0

1.5

-7.2

-12.

0

-1.1

-5.4

-20

-10

0

10

20

Bra

zil

Ch

ina

Ind

ia US

Ger

man

y

Japa

n

UK

Fra

nce

(%)

1 M 3 M

Source: Bloomberg. Returns as on March 31, 2016

11

.1

-3.1 -1

.6

3.2

-1.6

-8.8

-9.4

-12

.7

-12

.9

-16

.7

-19.

9

8.6

1.9

-3.6-0

.5

-2.1

-25

-15

-5

5

15

US

Bra

zil

UK

Ind

ia

Jap

an

Fra

nce

Ge

rman

y

Ch

ina

(%)

6M 1Y

All major markets witness negative return on a one-year basis

Source: Bloomberg, Returns as on March 31, 2016

8



Fixed income: RBI liquidity surprise to benefit short maturity papersReserve Bank of India (RBI) in line with market expectations, cut repo rate by 25 basis points (bps) to 6.5%. MSF (marginal standing facility) rate was reduced by 75 bps to 7% while reverse repo was increased by 25 bps to 6%, thereby reducing the policy corridor to +/- 50 bps f rom +/ - 100 bps previously. This move comes in to fine tune the alignment of weighted average call rate (WACR) to the repo rate and reduce variability in the metric.

Key takeaways on important aspects:a . L i q u i d i t y : R B I h a s differentiated its liquidity management framework into short term liquidity management and durable liquidity management. Short-term liquidity management will be driven by the need to supply or wi thdraw short- term liquidity from the market so as to accommodate seasonal and frictional liquidity needs such as the buildup of government balances and demand for cash during festivals and elections. The durable l iquidity management will include modulating net foreign assets (NFA) and net domestic assets

(NDA) growth over the course of the year, broadly consistent with the demand for liquid assets to meet transaction needs of the economy to facilitate growth. NDA includes purchase and sale of domestic bonds through OMOs (open market operations). Detailed guidelines are being issued separately by the RBI.

b. Inflation: Inflation trajectory remains on a projected path with target for FY17 at 5.1% and for FY18 at 4.2%. The probability of upside risk is higher due to Seventh Pay Commission and OROP (One Rank One Pension).

c. Future rate cuts: RBI's baseline and professional forecasters' projections indicate repo rate at 6.25% indicating one more rate cut of 25 bps in Fy17.

d. Growth projections: RBI's assessment of global growth is still muted and it also perceives a risk that the uneasy calm in global markets since the January sell off can be dispelled by a sudden risk off on incoming data . The domestic growth assessment is much more sanguine.

The pol icy was largely centered on addressing the critical concern of elevated

9



systemic liquidity deficit. L iquid i ty has worsened significantly in recent months on the back of a rise in government balances with RBI and currency in circulation. The central bank highlighted its intention to focus on meeting requirements of durable liquidity (i.e., core liquidity) and then streamline steps to address short term liquidity to ensure that it remains at around 0% of the total NDTL (Net Demand and Time Liabilities) of banking system from current 1% ( 80,000 crore). Market expects that OMO to the tune of 15,000 crore per month would be required to achieve RBI's durable liquidity target which be positive for long term yields.

The overall liquidity measures announced are extremely positive for funds at the short to medium term maturity papers. Therefore, bulk of the debt investment should be in good quality short-term debt funds. Ultra short-term debt funds and liquid funds are likely to benefit from the fall in short-term yields.

Although the outlook on G-Sec yields remains positive, the

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duration strategy should be played through act ively managed income or dynamic bond funds. They will be able to make swift duration change within G-Secs or switch between corporate bonds and G-Sec within specific duration.

Gold: Range bound movement expected post sharp reboundGold prices are trading in a n a r r o w r a n g e a r o u n d US$1250/ounce in March 2016 after having rallied significantly in the first two months of 2016. The year 2016 has turned the wave in favour of safe haven demand amid extreme global capital market uncertainty. Global gold prices rallied around 18% in January and February 2016.

The risk that was initially confined to commodities space started to spill over to currencies, equit ies and recently was also been impacting the credit markets as gauged by financial conditions and high yield bond market. The worsening condition is visible in rising credit default swap of countries like Brazil and companies like Deutsche Bank. As a result, the there is flight to safety and safe heavens like developed market

10



sovereign bonds (even when there is negative yield) and gold.

The expectation of quantum of rate hike by US Fed has declined significantly post recent turmoil in global capital markets. The market is now factoring in just one rate hike in the whole of the calendar year 2016 especially post dovish statement from US Fed Chair. Interest rate hike in general is negative for gold prices. With rate hike concern receding, the overhang on prices also

abates in the near term.

The steep fall in industrial commodity prices including crude oil led to sharp fall in inflation and inflationary expectations across the global and particularly in developed economies. The same led to reduced demand for gold as an inflationary hedge investment.

The medium term demand, however, will continue to be impacted by the overall global environment particularly US Fed rate hike trajectory.

Gold prices consolidating post sharp rally at start of year

1050

1100

1150

1200

1250

1300

Ap

r-1

5

Ma

y-15

Ju

n-1

5

Ju

l-15

Au

g-1

5

Se

p-1

5

Oc

t-1

5

No

v-15

De

c-1

5

Ja

n-1

6

Feb

-16

Ma

r-1

6

Ap

r-1

6

Price ($/Ounce)

Indian prices followed global prices

24000

25000

26000

27000

28000

29000

30000

Apr

-15

May

-15

Jun

-15

Ju

l-15

Au

g-1

5

Se

p-15

Oct

-15

No

v-1

5

Dec

-15

Ja

n-1

6

Feb

-16

Mar

-16

Ap

r-1

6

|

Price (|/10 grams)

Source: Bloomberg

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STOCK IDEAS


Greenply Industries: Numero uno player in MDF!

Company BackgroundIncorporated in 1984, Greenply Industries (GIL) is a leading player in the organised plywood and medium density fibreboard (MDF) market. The company has a strong pan-India presence with 33 plywood branches and 15 MDF branches. GIL has a distributor and stockist strength of 1170 and 600 in the plywood and MDF segments, respectively. This strong brand presence helps it to increase its market penetration in this highly fragmented wood panel industry. In 2014, the company de-merged its decorative b u s i n e s s c o m p r i s i n g laminates and allied products into Greenlam Industries, mainly to focus on its plywood and MDF business.

Over the past two decades, GIL has grown s igni f icant ly resulting in 26% market share in the organised plywood market and 30% market share in the domestic MDF industry. Furthermore, the company's strong brand presence and a well entrenched distribution network have helped GIL to evolve with changing times and cater to rising customer expectations. Moreover, to support its growth, GIL has

b u i l t f o u r p l y w o o d manufacturing facilities across the country with total capacity of 1,29,600 cubic metre (CBM) and an MDF facility with capacity of 1,80,000 CBM. With MDF demand on the rise, the company is undertaking a greenfield expansion to build an MDF facility in Andhra Pradesh with an annual capacity of 3,60,000 CBM.

Leading plywood player with 26% share of organised pieGIL is one of the leading players in the Indian plywood industry commanding ~26% market share in the organised space. GIL's plywood revenues have grown at a CAGR (compounded annual growth rate) of 14.3% in FY11- 15. The company is well placed in the market along with Century with both together accounting for ~50% of organised market. Both companies have grown ahead of their peers due to their strong brand presence, well entrenched distribution network , ba lance sheet strength and raw material security enabling them to charge a premium to their peers.

Investment Rationale


STOCK IDEAS

Asset light model with better utilisation to improve plywood division RoCEsGIL is currently operating at full capacity in the plywood division. Going ahead, with the optimal use of the product size mix (with higher proportion of products of 12-19 mm size), we expect the company's capacity utilisation to improve to 115% in FY18E. Furthermore, GIL has been following an outsourcing model in its plywood segment to cater to incremental d e m a n d . I n F Y 1 5 , o u t s o u r c i n g / t r a d i n g accounted for ~28% of total sales volume of 46.1 MSM. Going ahead, we expect o u t s o u r c i n g / t r a d i n g a s percentage of total sales volumes to increase to ~34% i n F Y 1 8 E . W i t h b e t t e r capacity utilisation coupled with higher proportion of outsourcing/trading (35-40% RoCE (return on capital employed) in outsourcing vs. 1 8 - 2 0 % i n o w n manufacturing), we expect the RoCE of the plywood division to improve to 19.4% in FY18E vs. 16.3% in Fy15.

Numero uno player in MDF segmentThe MDF business in India dates back to the late 1980s when Mangalam Timber

Products set up an MDF plant in 1985. In 2010, when GIL entered the market, there were only two players in the MDF space viz. Nuchem (which has n o w s h u t d o w n ) a n d Mangalam Timber Products. In spite of entering the segment in 2010, GIL has managed to become the market leader in the MDF industry. Currently, major players in the market include Rushil Décor, Action Tesa, Mangalam and Shirdi Industries. GIL has set up an MDF manufacturing facility in Pantnagar, Uttarakhand with an annual capacity of 1,80,000 cubic metre (CBM). The MDF market in India has grown steadily over the years and has a 5% share ( 1,400 crore) in the Ind ian wood pane l industry. On account of MDF's advantages over other wood products and reduced price differential between MDF and cheap unorganised plywood, a shift towards MDF is seen, going forward. In a market where pr ices o f cheap plywood are on the rise amid a strain on raw material supply from Myanmar, GIL launched its economy grade MDF 'Ecolite'. Consequently, we expect Ecolite to gain market share from cheap unorganised plywood, going ahead.

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STOCK IDEAS

GIL to benefit from transition towards organised pie; initiate with BuyAt the current market price (CMP) of Rs. 175, GIL is trading at 12.4x FY18E EPS. With its strong brand presence, well es tab l i shed d is t r ibut ion n e t w o r k c o u p l e d w i t h increasing brand aspiration, the company is all set to ride the structural shift towards the

o r g a n i s e d m a r k e t w i t h expected GST (goods and services tax) implementation. Going ahead, we anticipate GIL's topline/bottomline will grow at a CAGR of 11.5%/ 16.5%, respectively, in FY16-18E with a comfortable balance sheet. Hence, we initiate coverage on GIL with a BUY recommendation with target price of 225.`

Stock Data

Market capitalization ( crore) 2,197

Total debt ( crore) 306.2

Cash ( crore) 7.2

Enterprise value (EV) ( crore) 2,456.8

52-week High/ Low ( ) 226 / 152

Equity capital ( crore) 12.1

Face value ( ) 1

FII holding (%) 10.2

DII holding (%) 13.3

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Key Financials

Valuations Summary

FY15 FY16E FY17E FY18E

Net sales ( crore) 1,564.3 1,633.3 1,826.8 2,032

EBITDA ( crore) 204.3 243.1 277.9 316.2

Net profit ( crore) 121.8 125.5 148.4 170.4

EPS ( ) 10.1 10.4 12.3 14.1

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P/E (x) 17.7 17.2 14.5 12.7

Target P/E (x) 22.3 21.6 18.3 15.9

EV / EBITDA (x) 12.1 10 8.8 8.5

P/BV (x) 4.5 3.6 2.9 2.4

RoNW (%) 25.2 20.9 20.1 19

RoCE (%) 18.3 19.3 19.1 16.6

FY15 FY16E FY17E FY18E


STOCK IDEAS

Key Risks

Tax, excise duty exemptions to end at certain facilities: GIL enjoys tax benefits and excise duty exemptions at its manufacturing units in Nagaland and Uttarakhand (plywood & particle board unit and MDF unit). However, at some locations, these benefits are either being phased out or reducing, going ahead. Consequently, it is expected to lead to a higher tax outgo

impacting GIL's bottomline negatively. Though we have already factored in a higher tax rate of 25% in FY16E, 28% in FY17E and 30% in FY18E vs. 13.8% in FY15E, any higher-than-expected tax implication may i m p a c t i t s e a r n i n g s g r o w t h significantly. Domestic demand pick-up delay may impact earnings assumptions

Plant Product Benefits

Tizit, Nagaland Plywood 100% corporate tax exemption from FY06-15.

Excise duty exemption from FY16-25

Pantnagar, Uttarakhand Plywood 100% corporate tax exemption for FY07-11

30% corporate tax exemption for FY12-16.

Excise duty exemption for FY07-16

Pantnagar, Uttarakhand MDF 100% corporate tax exemption for FY10-14

30% corporate tax exemption for FY15-19

Excise duty exemption till FY20

Lack of raw material availability: The industry procures majority of its raw material from Myanmar as well as countries like Vietnam, Indonesia, Thailand, Germany, etc. We believe the biggest risk for GIL as well as industry is their inability to procure raw material on the back of any unforeseen regulat ion in the respective jurisdiction e.g. Myanmar's ban on raw timber export. However, we believe GIL is well placed in terms of raw material security after setting up a peeling unit in Myanmar to facilitate the sourcing of face veneers.

Any such respective jurisdiction changes in regulation may impact GIL's business significantly.

Delay in GST implementation: GST will be a huge positive for GIL as it would bring in a shift of consumers from the unorganised to organised space with a reduction in the price differential, going ahead. GST will address inefficiencies in the current tax system. However, any delay in implementation of GST could impact GIL, as it would be difficult for GIL to gain market share, going ahead.

(EBITDA: Earnings before interest, taxes, depreciation, and amortization; EPS: Earnings per share; P/E: Price-to-earnings; EV: Enterprise value; P/BV: Price-to-book value; RoNW: Return on net worth; RoCE: Return on capital employed; FII: Foreign institutional investors; DII: Domestic institutional investors)


STOCK IDEAS

Majesco: An attractive investment story

Company Background

Investment Rationale

Majesco, the demerged entity of Mastek, underwent a reorganisation in 2015. With building blocks in place, we believe, Majesco is poised to capture incremental opportunities in the core insurance outsourcing space, by leveraging its product offerings, top rated product, sticky client relationships and first-rate execution. This coupled with a healthy balance sheet and attractive valuations (~50% discount to global peer group average) makes Majesco an attractive investment story.

Majesco awaits large addressable marketThe Top 100 US property and casual ty (P&C) insurers underwrote net premium worth ~$450 billion in Cy14. Typically, insurers budget ~3-4% of their annual revenues on IT related spends including s t a f f i n g , h a r d w a r e , maintenance and product development, translating to ~$15 billion worth of spending. Even if we were to

assume that 70-80% of spends could be in-sourced or attributed to hardware and staffing related, core product development, even then software, business intelligence & data analytics and warehousing could still be a large addressable market worth $3-$5 billion dollars. The management estimates the a d d r e s s a b l e m a r k e t opportunity at ~$9-10 billion based on technology spends by carriers.

Cloud is Majesco's moatMajesco has 30 customers on private cloud, which is its key differentiator. Cloud revenues constitute 18.5% of total, up 400 basis points (bps) QoQ (quarter on quarter) while 30-40% of deals last year involve cloud. The rationale is 1) cloud adoption has picked up within mid and small sized carriers, which is Majesco's primary target market, 2) few competitors have cloud-based software, 3) lower total cost of ownership given Majesco implements its own software and has India (offshore) based delivery and 4) Guidewire's


STOCK IDEAS

(GWRE) catch-22 situation. On the one hand, Guidewire, among the largest, is working t o w a r d s c l o u d - e n a b l e d software but Majesco has early mover advantage, while, on the other, large P&C carriers, GWRE's primary target market, are reluctant to run systems on cloud given large operations. Further, E&Y, Cap Gemini SA, PWC, IBM and Deloi t te (together with >$1 billion in implementation revenues from GWRE) GWRE's largest system integrators could lose annuity revenues if it completely embraces cloud. We believe the environment favours Majesco and could lead to 1) market leader positioning in mid-market segment, and 2) market share gains within large carriers (recent tier-I wins include QBE and MMG in P&C and Unum in L&A).

Cover-All integration augments Majesco's offeringsMajesco's recent merger with Cover-Al l and i ts Agi le acquisition notonly strengthen its product offerings but could also drive incremental revenue opportunities. Cover-All's business intelligence

platform adds analytics capabi l i t ies – improves response time based on user feedback – while Agile's US based consultants add consulting capability – has higher than company average margins and could aid downstream revenues. Together they brought 50+ customers to Majesco with minimum overlap and could aid cross-selling opportunities. Fu r t h e r, C o v e r - A l l h a s proven commercial insurance software, which could hasten the development of modules of Majesco's commercial insurance platform – driving cost synergies – and establish its market presence. Finally, Cover-All gave Majesco the all-important NYSE capital market access and could generate US institutional investors interest.

Healthy wins in 9MFY16 support bullish thesis of FY17E/18EGenerally, the sales cycle in the insurance product business is elongated with lead time of >12 months wherein Majesco consults the insurance carriers in choosing the required product. However, during 9MFY16, the company won 14 deals taking the 12-month


STOCK IDEAS

order backlog to $63 million. Assuming implementation tenure of two to three years likely provides growth cushion in the next two years. We expect Majesco's revenues to grow at 25% CAGR in FY15-18E led by deal wins and conversion. PAT could grow at 128% CAGR in FY16-18E with average 9.2% EBITDA margins (which could rise to 6.1%, 12.3% in FY17E/18E vs. 0.9% in FY16E). Our growth thesis is s u p p o r t e d b y h e a l t h y bookings.

Healthy cash balance may support growth; valuation attractive relative to global peersAmong the primary reasons to restructure Mastek and create Majesco as a separate entity were to better leverage existing IP capabilities, capital allocation strategies, access to global capital, attract investors with risk appetite and value creat ion by address ing shareholder concerns of sub-optimal performance of the combined entity. Though the post-restructuring market capitalisation of the combined entity has risen significantly to ~ 1500 crore vs. 300 crore pre-demerger, we believe

` `

Majesco, still offers a deep discount value. The rationale is that Majesco US trades at a 50% discount on MCap/sales metric to global peer group average and ~70%+ discount to the Guidewire's multiple. T h o u g h m e d i o c r e growth/margins and RoCE profile could be attributed to the same, the management aims to double its revenues to $ 200-225 million in the next three years with double digit operating margins (12-14%). Despite Guidewire and Duck Creek (Accenture) are large vendors w i th s t i cky relationship, we believe Majesco's steep discount is unwarranted given it is a notable vendor with nine of the top 25 insurers as customers while higher scale with CoverAll (and its mid-market focus could help capture incremental opportunities through cross-selling) and rising growth, profitability could narrow operat ing performance divergence gap. We value the shares at 2.5-2.6x on MCap/sales metric to arrive at our target price of 700-750 and recommend BUY.

`


STOCK IDEAS

Key Financials

Valuations Summary

Stock Data

Net sales ( crore) NA 493.6 690 820

EBITDA ( crore) NA 2 6 50

Net profit ( crore) NA (18.8) 5 21

EPS ( ) NA (8.3) 2.2 9.2

FY14 FY15 FY16E FY17E

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`

`

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P/E (x) NA NA NA 60.6

Target P/E (x) NA NA 340 81.7

EV / EBITDA (x) NA NA 200.4 24

P/BV (x) NA 4.7 4.6 4.2

RoNW (%) NA NA 1.8 7.2

RoCE (%) NA NA NA 6.4

FY14 FY15 FY16E FY17E

Market capitalization ( crore) 1,273

Total debt ( crore) 80.5

Cash ( crore) 151.3

Enterprise value (EV) ( crore) 1202.3

52-week High/ Low ( ) 789 / 287

Equity capital ( crore) 22.9

Face value ( ) 10

FII holding (%) 7.2

DII holding (%) 8.3

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STOCK IDEAS

Key Risks

Business specificSustaining new logo wins could be t r i c k i e r t h a n a n t i c i p a t e d : A l though the insurance software market opportunity is huge, new logo wins are key to sustaining growth momentum while the sales cycle, generally, is elongated and has greater than twelve month lead time. Further, though Majesco's billing and policy admin software is ranked No. 1 and No. 3, respectively, the market is highly fragmented while relat ionships are st icky. Majesco caters primarily to the mid-market segment. Inability to win new deals could j e o p a r d i s e o u r g r o w t h est imates and, in turn, valuation thesis, which is also obligated by execution and earnings delivery.

Company specificAcquisitions, rising tax rates could be near term concerns: Tax rates could rise significantly in FY17E, FY18E to 30% as the US could contribute a majority of incremental profits, where tax rates are high while India losses could be ineffective to capture tax breaks advantages available in India. Reduction of losses or rising profitability in India could lower overall tax rates. Majesco plans to acquire companies in the US, which could accelerate the growth momentum. However, inability to integrate the same could worsen operating metrics and pressur ise the earnings trajectory. Conversely, a significant upside risk to estimates exists if Majesco successfully acquires and integrates a decent size acquisition.

(EBITDA: Earnings before interest, taxes, depreciation, and amortization; EPS: Earnings per share; P/E: Price-to-earnings; EV: Enterprise value; P/BV: Price-to-book value; RoNW: Return on net worth; RoCE: Return on capital employed; FII: Foreign institutional investors; DII: Domestic institutional investors)

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FLAVOUR OF THE MONTH

How to Align Your Portfolio to Current Interest Rate Environment

Interest rates in India have been trending lower and are currently at 5-year low with repo being at 6.5%. The Reserve Bank of India (RBI) has cut repo rate (the rate at which it lends to commercial banks) by a total of 150 basis points (bps) since January 2015, including the latest 25 bps cut in April 2016. While low interest rates are good for borrowers, investors get a hit in their overall portfolio returns. So how do you deal with it? This article addresses the effect of interest rate changes and suggests how you may align your portfolio for better returns in the current low interest rate environment.


Understanding the bigger picture

Preparing for interest rate

changes requires that you first

unders tand the cur rent

macroeconomic scenario. We

are fundamentally in a falling or

low interest rate environment,

thanks to easing inflation.

“Other factors such as fiscal

deficit and current account

deficit (CAD) are also in control

and are looking better. This

gives us comfort and reason to

believe that we are in for a

sustained low interest rate

cycle,”

“The current debt market

scenario is extremely positive

with the economy on a

continuous disinflationary trend,

government's commitment to

fiscal consolidation plan, RBI's

commitment to neutral system

liquidity with accommodative

stance and relatively stable

currency and other external

market factors,”

says a debt fund manager

with Kotak Mutual Fund.

says Prashant

Pimple, Senior Fund Manager - Fixed

Income Investment, Reliance Mutual

Fund.

Source: Bloomberg, April 2016 (by Franklin Templeton Mutual Fund)

Headline inflation trend (% YoY); Primary articles inflation seeinga downtrend

21



RBI Policy Rates Trend

Source: RBI, April 2016 (by Franklin Templeton Mutual Fund)

Asymmetry in monetary policy

transmission

Akhil Mittal,

Senior Debt Fund Manager at Tata

Mutual Fund:

Though the RBI has cut repo

rate by a cumulative of 150

basis points since January

2015, the transmission of

policy rates to lending rates

has not taken place fully yet.

Why? Explains

“The system had

been grappling with huge

liquidity deficit situation,

caused both by structural as

well as to a certain extent

caused by seasonal factor.

These tight conditions were

being considered to be an

impediment for effective

monetary transmission.”

However, with the latest

liquidity easing measures by

the RBI and the cut on small

savings interest rates,

monetary policy transmission

would improve, believe debt

fund managers.

“The RBI has taken precise

efforts to identify and address

the pressing need for easier

liquidity to be made available in

the system. The change in

stance from maintaining deficit

liquidity to neutral liquidity is a

huge shift from the earlier

regime. The central bank

proposes to use a combination

22



of short term and durable

liquidity to effectively achieve

the dual objective of dealing

wi th f r ic t iona l l iqu id i ty

requirements and providing for

sustainable liquidity to transmit

rate cuts,”

“The cut in small savings

schemes rates would improve

monetary policy transmission.

Banks frequently cited the high

s m a l l s a v i n g s r a t e a s

cannibalizing bank deposits.

Therefore, lower small savings

rates, along with marginal cost-

based pricing of loans from April

2016, should facilitate an

improvement in monetary

policy transmission (lower

lending rates) going forward,”

“Further, lower small savings

rates will also lower the total

accretion into these small

savings schemes and this

should reduce the interest

burden for the cent ra l

government as the interest rate

paid through these schemes are

not market linked and were

says Franklin Templeton

Mutual Fund in its debt commentary

note.

says Prashant Pimple.

generally higher than market

r a t e s . T h u s , m o n e t a r y

transmission would improve

going ahead, further lowering

rates and in turn benefitting debt

market investors

The last financial year i.e. Fy16

saw a cumulative rate cut of 125

bps, but the government

Securities (G-Sec) yields fell only

by 25 bps and remained sticky at

high end. Why? “Major reasons

for the same were Global viz.

Federal Reserve rate hike scare,

volatile capital market flows,

depreciating EM currencies

amongst others. On the

domestic front, low deposit

growth, uncertainty surrounding

fiscal consolidation, high small

savings rate and tight liquidity

condition were some of the

major reasons for yield

movement not following rate

easing cycle. Since February,

with clarity on fiscal, inflationary

trends, and stable global factors,

we have seen a sharp fall in

yields,”

, he adds.

G-Sec yields did not follow RBI's rate

cuts

explains Akhil Mittal.

23



Benchmark 10-year G-sec Yield Trend

Source: Bloomberg, ICICIdirect.com Research

More rate cuts ahead?

Prashant Pimple.

Akhil Mittal says,

Post RBI's latest repo rate cut in its April 2016 monetary policy, m a j o r i t y o f d e b t f u n d managers foresee one more rate cut ahead of 25 bps in FY17. “We expect RBI to lower policy rate by an additional 25 bps in FY17 provided the hi-frequency inflation numbers continue to undershoot RBI's projections. But effective rate cut can be additional 50 bps if system liquidity becomes Neutral from the current deficit mode,” says

“There still exists a small window of oppor tun i ty fo r fu r ther monetary easing by a maximum of 25 bps. However,

a cut beyond 25 bps, will only lower the real rate below RBI's comfort range, given the upside risks to inflation pointed out by RBI.”

“Headline retail inflation should see some cooling off over the next quarter, primarily driven by favorable base effect and supported by normal monsoon as being widely anticipated. We expect another 25 bps rate reduction this year,” says

L o w e r i n f l a t i o n , t h e government's adherence to

Franklin Templeton Mutual Fund in its debt commentary note.

Expected trends ahead for G-Sec Yields

24



fiscal discipline by maintaining the fiscal deficit target for FY16-17 at 3.5% and a sharp cut in small saving deposit rates have led to a much anticipated rally in G-sec yields. The outlook on G-sec yields remains positive.

“As we approach towards terminal end of current easing cycle, we believe that yield curve should steepen going ahead. As market participants demand higher premium for duration risk, there would a limited downside to yields at longer end of the curve. However, the RBI measures to bring the system liquidity to neut ra l a long wi th the narrowing of the corridor to 50 bps and CRR (cash reserve ratio) maintenance at 90 percent will allow overnight rates to remain very close to the repo rate or even drift marginally lower. This would in turn be positive for shorter end of the curve,” says Akhil Mittal.

The l iqu id i ty measures announced by the RBI in its recent policy meeting will

Short-term debt funds looking attractive

soften short term yields. Short-term funds have the aim of delivering returns by investing in higher accrual AAA and AA corporate bonds with maturity of around one to three years alongside some investment in money market instruments. Many short-term funds focus on utilising credit opportunities by investing in sub AAA rated papers with reasonable credit worthiness with the aim of delivering higher returns. Higher accrual income and held to maturity portfolio (with less duration of about two years) make these funds comparatively less volatile as against long term funds. Short term debt funds are stable performing funds with low volatility in returns. Although outlook on interest rate remain positive, G-Sec funds or Income funds or Dynamic bond funds are more volatile and carry higher interest rate risk.

“Ultra short-term and short term funds would benefit the most out of the bull steepening trade going forward. With positive liquidity framework of RBI, shorter end rates provide

25



attractive carry opportunity at current absolute yields,”

“With shorter end rates expected to ease further, Credit funds also look better poised to benefit out of the fall in shorter end yields. With recent fall in the small savings rates & expected fall in FD rate products, credit funds are an attractive investment option given the higher spreads available right now,” he adds.

“In line with our view on market and yield curve, we believe short duration funds could provide better risk adjusted return as compared to long duration funds. However, if one has higher risk appetite, one could look at long duration funds also as we are still in easing cycle,”

Short-to-medium term debt funds make good investment sense for investors with the low risk appetite and still are looking for returns. As the name connotes, these invest in short and medium term papers, and the portfolio maturity hovers around a few months to few years. These


says Akhil Mittal.

funds offer good risk-adjusted returns to investors who are willing to remain invested with at least one-year horizon. As the rates are said to be peaking and are expected to be there for some time, short-term bond funds are very good opt ions for r isk averse investors. These schemes offer investors to benefit from the high short-term interest rates with minimum risk.

Typically, long-term debt funds perform well in an easing interest rate cycle and short-term funds in a rising interest rate cycles. For example, we saw rising interest rate cycles in 2004-07 and 2009-13 and short term funds delivered better CAGR returns (6.18%) than gilt funds (4.13%). On the other hand, in a falling interest rate cycle from 2014 till date, gilt funds have performed well (11.45%) as compared to short-term funds (9.32%).

Read more about our recommended short-term debt funds in our Mutual Funds Analysis section of this edition.

Long term debt funds are also an option

26



Interest Rate Cycles - Repo and G-Sec Trends

By Reliance Mutual Fund

Performance of debt funds across interest rate cycles

CategoryRising Interest Rate Cycle Falling Interest Rate Cycle

2004-07

2009-13

2014-till date

Gilt Funds* 4.13%

3.81%

11.45%

Short Term Funds* 6.18% 7.43% 9.32% Repo Rate 6%

7%

6.5%

*CAGR (compounded annual growth rate) of funds in specific categories; By Reliance Mutual Fund

“We expect another 25 bps rate

reduction this year. We thus

remain bullish on medium-to-

long duration segment and

recommend investors (who

can withstand volatility) to

consider duration bond / gilt

funds for the medium to long

term,”

“Long duration funds would benefit over the next 12 months from the fall in yields across the curve .We expect scope for further capital gains exists on further monetary

says Franklin Templeton

Mutual Fund in its note.

easing . Positive global trends can trigger huge domestic bond appetite,”

Long-term funds invest in corporate and government securities with long maturities. These funds are exposed to interest rates risk. If interest rates move up, the price of the bond falls and vice versa. As these funds invest in long dated paper, sensitivity to interest rates - price movement in opposite direction of movement in interest rates – is very high. In rising interest rate


27



scenario, investors in these funds lose. But if the rates are about to fall (like the current scenario) the portfolio will offer two way gains with fall in interest rates. First - it will offer

coupon payments and second it will also offer capital appreciation as bond prices go up. But if interest rates go up, this will not fructify.

Things to know: Three basic investment strategies of debt funds

There are basically three strategies of debt products: Hold-to-maturity (HTM), accrual and duration.

HTM

accrual strategy

duration strategy

is a passive strategy, wherein the fund manager buys and hold high-yielding debt securities till maturity, e.g. fixed maturity plans (FMPs). This way the investor is not exposed to any interest rate volatility if he holds on to the maturity of the fund. Bank and corporate fixed deposits are also part of the HTM strategy.

In , the focus is on searching for corporate bonds with higher yields - e.g. short-term funds.

Whereas in , the focus is on adjusting the duration of the portfolio based on interest rate outlook to maximise returns - e.g. income funds, gilt funds and dynamic bond funds.

Deposits, small savings schemes and tax-free bondsIf you are planning to invest in corporate and bank deposits and small savings schemes, do so before the interest rates are further reduced. Given the possibility of a further fall in rates, it makes sense to lock in your money for the longer term. But if inflation climbs up, you are exposed to the risk of earning a negative rate of return. Fixed deposit investors always suffer this risk in times when the rate payable on fixed deposits is lower than the

prevailing inflation. If such situation persists for long time periods, it eats into the purchasing power of an investor.

Tax-free bonds are also a good investment option for tax efficient returns in the current markets. These are fairly safe option for investors, and for those in the high tax bracket the net yield is higher than fixed deposits of similar risk. These bonds are listed on the stock exchange and most of them have reasonable liquidity. However for large holdings,

28



one may have to stagger the sale over a period of time or it may help to invest across issuers.

Senior citizens and retirees are hit the most when there is a rate cut. This is because they are mainly dependent on interest-bearing instruments for their needs. With falling interest rates, elderly need to be prepared for higher income by looking at higher-yielding instruments such as corporate f i x e d d e p o s i t s , b o n d s , equities, etc.

Elderly need to prepare for higher income

Ty p i c a l l y, f i x e d - i n c o m e instruments provide very low real returns after accounting for inflation and taxes. It is therefore important to include growth assets such as equity to your portfolio even when nearing retirement or are already retired.

A retirement portfolio can be divided into two parts: Income and Growth. A part of the portfolio, say for example, 15-20% can be allocated to equity for growth. Equity diversified funds / large-cap funds are best options that keep volatility as low as possible.

How we can help you

Retirement income planning is complex, especially in a current low interest rate environment. It is really important to judiciously deploy your retirement corpus so that you get adequate regular income through your golden period. If you are considering taking professional help, our Retirement Planning Service can provide you with a personalized plan that can go a long way in achieving your retirement objectives of safety, income and growth.

As a first step, we spend time with you to understand your risk profile, preferences and collect information that would help us design a customized retirement income plan. Once the plan is ready, it is then incorporated on your ICICIdirect.com account so you can execute and track your plan online, at your convenience and at all points of time. Our intelligent 24X7 'Track&Act™' robo-advisory platform will help you give triggers if you are maintaining your asset allocations right, will help track if your withdrawals are as per the plan, and even advice you where to invest into and/or withdraw from. Speak with your ICICIdirect relationship manager today to plan your retirement well.

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Home loan borrowers to gainFalling interest rates benefit borrowers the most, especially those with floating-rate loans such as home loans. The other loans – auto, personal, etc. are generally fixed in nature and a rate cut may not impact them.

Let's understand the impact of a rate cut on home loan with an example. Suppose you have taken a home loan of 40 lakh `

five years back at an interest rate of 10.50% p.a. for a tenure of 20 years. It translates into an EMI of 39,935 for the last five years.

Now, let's take a look at three different scenarios, where the interest rate on your home loan has been reduced by 25 bps, 50 bps and 100 bps. This will result into lower EMIs, as follows:

`

Original EMI for first years: Rs. 39,935`

25 bps rate cut

50 bps rate cut 100 bps rate cut

Reduced EMI for the next 15 years ` 39,377 ` 38,823 ` 37,725

Savings per month due to lower EMI ` 558 ` 1,113 ` 2,210

As you can see in the above table, with 100 bps rate cut, you can save 2,210 per month. It would be a good idea to

Say for example, if you invest 2,210 per month in an equity diversified fund for the next 15 years, you would be able to create a corpus of 10.52 lakh, assuming a return of 12% p.a. This way, with lower EMIs, you are able to generate additional corpus side by side, which can help you in meeting your other financial goals.

`

`

`

convert your EMI savings into an SIP.

There is also another option of prepaying your home loan. You can invest your EMI savings, say into a balanced mutual fund, generating an average return of 9% p.a., and use the accumulation at the end of every 5 years to make part prepayment of your home loan. With this, you can pre-close your home loan faster than the original tenure.

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Please send your feedback to [email protected]


Original loan tenure: 20 years 25 bps rate cut 50 bps rate cut 100 bps rate cut

Total tenure in which loan can be closed

19 years and 7 months



Tenure gets reduced by 5 months 10 months 20 months

Summing up

Debt instruments play an

i m p o r t a n t r o l e i n o u r

investment portfolios – be it

through capital protection,

stable income, diversification,

or some combination thereof.

By tak ing a thought fu l

approach, you can better align

your portfolio to current

interest rate environment and

make the most of it. Make sure

you maintain your portfolio

asset allocation across equity

and debt and focus on total

returns, not just current

interest rates.

31

Tête-à-tête

‘Good opportunity to build position in equities'

There is a lot of gloom because of global factors but structurally if we look at India, this is a good opportunity for investors to build position for creating long term wealth, says Sankaran Naren - Chief Investment Officer (CIO), ICICI Prudential Mutual Fund, in an interview with ICICIdirect Money Manager. New or existing investors should start building position in equities if they are ready to remain invested for a full cycle (five years or more), he adds. Excerpts:

Sankaran Naren -

Chief Investment Officer (CIO),

ICICI Prudential Mutual Fund


Q:

A:

Financial markets across the globe have largely been in red in 2016 so far. Will we see more of the same this year?

As crude oil fell dramatically, the budget estimate for many oil producing countries went out of sync. As budget losses increased, the sovereign wealth fund (SWF) of these countries started to pull out their investments to support the budget deficit at home. This became one of the biggest reasons for losses witnessed

by indices globally. We believe that oil prices should become stable around USD 50, the fair p r i c e , w h e r e b o t h t h e consumer and the producers may benefit. If this happens, then markets could recover.

What are a few reasons to be optimistic in the midst of the gloom?

There is a lot of gloom because of global factors but structurally if we look at India, this is a good opportunity for investors to build position for creating long term wealth. Historically, when investors have built position when foreign institutional investors (FIIs) outflow was high like in 2002 , 2008 , and 2011 , investors have made good returns over the following three years.

Also if we look at the average capacity utilisation, we can see that we are at a low again (below 75%). This would bring in operating leverage for many of these companies, once demand starts picking up.

Q:

A:

32

Tête-à-tête


They will not have to invest for increasing production in the immediate future thereby allowing the companies to report higher operating profit.

Foreign institutional investors (FIIs) have been net sellers with over $2.2 billion outflows year-to-date. Do you see more selling in the offing?

It is very difficult to time the selling spree of the FIIs. We believe as oil prices become stable around the USD 50 range, global turmoil will lessen and markets may turn out to be steadier. At that time, India could present as one of t h e b e t t e r i n v e s t m e n t opportunities for FII investors as the government's fiscal deficit could be within a reasonable limit and the macro s t o r y m a y p r e s e n t a n investment opportunity. Also, as Sovereign Wealth Fund (SWF) flows may resume to emerging markets, investment f low to Ind ia too may recommence.

Corporate profitability is at a 10-year low. Deteriorating corporate and banking sector health can exacerbate risks, says IMF. What are your views on this? By when do you see corporate and banking balance sheets improving?

C u r r e n t l y, c a p a c i t y utilisation in the manufacturing

Q:

A:

Q:

A :

sector is at a multi-year low, but we be l ieve that s t rong operat ing leverage and gradual improvement in demand could improve the utilisation rate and drive corporate earnings over the next three to four quarters. Also the government's focus on the infrastructure space, as evident in Union Budget, will give impetus to manufacturing activity. Higher capacity ut i l isat ion coupled with reduction in non-performing assets (NPAs) in the banking space cou ld boos t the economy.

The rupee has been depreciating against the U.S. dollar, making it one of the worst performing emerging-market currencies this year. How do you see this impacting India's heavily indebted companies, especially those with dollar-denominated obligations?

Over long-term, we believe the Indian currency will continue to follow the path of gradual depreciation against the dollar due to inflation and interest rate differentials.

Crude and other commodity prices have been plunging. How do you see this benefiting the overall economy in general and corporate India in particular?

For the Indian economy, lower crude and commodities

Q:

A:

Q:

A:

33

Tête-à-tête


prices help the government to consolidate its fiscal position. For corporate India, the effect is more dependent on the nature of the industry. To explain with an example, lower commodity pr ices have benefited the FMCG (fast-moving consumer goods) and tyre industries by lowering raw material prices. On the other hand, many trading partners of I n d i a n c o m p a n i e s a r e expor ters of pet ro leum producing countries. A fall in oil price may impact their e c o n o m y, a n d h a m p e r demand for Indian products.

The Union Budget 2016-17 seems to be fiscally prudent. How do you see this benefiting both equity and debt markets in the medium to long term?

We believe that the FY2016-17 budget is a balanced budget where the government has maintained its commitment to fiscal consolidation. The government borrowing in 2016-17 has a lso been contained and this could lead the Reserve Bank of India (RBI) to ease policy rates further. We believe fixed income is clearly a preferred asset class at this point in time, as returns may be front-ended.

We believe the government has set the stage for RBI for further rate-cuts. Thus, fixed

Q:

A:

income investors could expect good returns during 2016.

The Union Budget a lso underlines the Government's determination to provide an impetus to the economy e s p e c i a l l y t h r o u g h t h e infrastructure, rural and financial sectors. It lays emphasis on repairing balance sheets of banks, reducing non-p e r f o r m i n g a s s e t s a n d boosting employment in the largest section of the economic pyramid.

Given this focus on reform, repair and revival, we see a prospective up-cycle in the economy.

The recovery process could provide ample opportunities to accumulate equities in 2016. We maintain our view and recommend investors to go marginally overweight on equ i t ies now and fu l ly overweight by end of 2016.

Given that the government remains committed to fiscal prudence, where do you see interest rates heading towards? Where should a long-term fixed-income investor invest currently?

We believe that interest rates will continue on the downward trajectory, especially due to the fiscal prudence as shown by t h e g o v e r n m e n t . W e

Q:

A:

34

Tête-à-tête


recommend investors to stay invested in long duration funds.

New investors can invest in short to medium term and dynamic duration funds for long term; and for tactical allocations one may invest in long duration funds with a short term investment horizon.

Which sectors would you prefer now to add to your portfolio? Which ones would you avoid?

We believe that the NPA issue in the banking sector is peaking out; therefore it is an important sector where investors can build position. Also domestic cyclical industry is something which we believe is better placed.

FMCG as a sector is over valued though there maybe few selective opportunities present.

Could you please throw some light on the Brexit (British exit from the European Union)? What are the key economic and financial risks of Brexit? What could U.S elections mean for the Indian markets and investors?

Events like these may result in high volatility in the stock m a r k e t i n t h e s h o r t termthereby providing good opportunities for investors. We

Q:

A:

Q:

A:

believe that in such scenario asset allocation funds may give reasonable returns.

In the backdrop of the current market scenario, what is your advice to new and existing investors?

In India retail investors are underexposed to equities, hence, they should look at this market as an opportunity. Historically, it has been rewarding for investors when they maintained exposure to equities over longer periods.

New or existing investors should start building position in equities if they are ready to remain invested for a full cycle (five years or more). Investors should adhere to the principles of asset allocation and balance their portfolios based on their risk appetite and time horizon of investments.

What are the key fundamental principles of building a successful, long-term investment portfolio?

Asset allocation is very important for investors to build a successful, long term investment portfolio. The other thing that is important for investors is to understand their risk level and time horizon to be spent in a particular asset class.

Q:

A:

Q:

A:

The views expressed in the article are personal views of the author and do not necessarily represent the views of ICICI Securities.

35

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Effect of new interest rates on small savings schemes


Q: I had missed the recent announcements relating to the interest rate changes of Post Office Investments. I have existing investments into Post Office – a Senior Citizen Saving Scheme and a Monthly Income Scheme a year back. Will the new interest rates be changed in these too or are they only for new accounts to be opened from this financial year? How it will affect while renewing these investments after maturity? What

about Public Provident Fund, as my son is investing into the same?

- Kailash Sawant

The Government slashed interest rates on small savings schemes offered by Post Office in March 2016, due to the substantial cut in policy rates by the Reserve Bank of India (RBI) in the past one year. These changes will be with effect from April 1, 2016.

A:

Revision of interest rates for Small Savings Schemes

Source: The Ministry Of Finance, Government of India.

The government has also decided to review the interest rates of small savings schemes

Sr. No.

Quarter for which revised rate of interest would be effective

Date on which the revision would be notified

1. April to June

15th

March

2. July to September 15th June

3. October to December

15th

September

4. January to March 15th December

every quarter, so that the effect of change in policy rates can be passed on more frequently.

36

ASK OUR PLANNER


In schemes like Senior Citizen

Savings Scheme (SCSS), Post

O f f i ce Month ly Income

Scheme (POMIS), National

Savings Certificate (NSC),

Kisan Vikas Patra (KVP), etc.,

the new rates are applicable

only for new customers.

In your case, you are locked at

the rates at which you bought.

Hence, your existing

investments into SCSS and

POMIS will remain the same as

it was at the time of investing a

year back. The interest will

remain fixed in your

investments for the entire

duration of the investment i.e.

5 years. On maturity, when you

renew these investments, you

can lock the interest rates

applicable at the time of

renewal.

In products like PPF and

Sukanya Samriddhi Scheme,

the lowered rates will be

applicable for the entire

accumulated corpus and not

just for the new investments.

I sold one of my houses in

February 2016 for 80 lakh. I

bought this house in 2007-08 for

35 lakh. I want to know how much

Q:

`

`

tax I should pay on the capital gains

made. Is there any way I can avoid

paying the tax? If yes, can you

please guide me on the same?

- Rohan Shah

Firstly, capital gains on sale

of properties are classified as

short-term (if sold within 36

months from the date of

purchase) and long-term (if

sold on or after 36 months from

the date of purchase). The

short-term capital gains (i.e.

sale price less purchase price)

are added to your income in

the year of sale and taxed as

per your income slab. There is

no exemption available on this

gain.

For calculating long-term

capital gains, first, the indexed

cost of purchase has to be

calculated as in the year of sale,

using cost of inflation index

(CII). You have purchased the

house in 2007-08, when the CII

was 551; and in the year of sale

i.e. 2015-16, the CII was 1081.

Hence, the indexed cost of

purchase in 2015-16 is 68.67

lakh (i.e. 35 lakh / 551 x 1081).

Now, capital gains will be the

difference between the sale

A:

`

37

ASK OUR PLANNER


price and the indexed cost of

purchase, which comes to

11.33 lakh.

Long-term capital gains on

properties are taxed at 20.6%

( i n c l u d i n g c e s s ) a f t e r

indexation. Hence, you will be

liable to pay a tax of 233,479

(i.e. 20.6% on 11.33 lakh).

H o w e v e r , t h e r e a r e

exemptions available on this

capital gain, if you reinvest the

capital gain in any of the below

2 options:

1) Section 54: Purchase of

another residential property

within 1 year before or 2 years

after the date of sale; or

construction of residential

house property within a period

of 3 years from the date of sale.

Such new property should not

be sold within a period of 3

years from the date of

acquisition. The capital gains

shall be exempt only to the

extent it is invested in the

purchase / construction of

another house.

2) Section 54EC: Investment of

capital gain into capital gain

bonds within a period of 6

`

`

months from the date of sale.

These bonds are generally

issued by REC and NHAI and

the interest rate offered is 6%

p.a. with duration of 3 years.

The interest earned on this is

taxable. The maximum limit of

investment into such bonds is

50 lakh.

I am a senior citizen and I would

like to know if the return by way of

annual/monthly pension for the

investment in LIC's Jeevan

Akshay's Pension scheme is

taxable or is it tax free.

- B. Ramaswamy

LIC Jeevan Akshay is an

immediate annuity plan. The

annuity i.e. pension to be

received from any annuity plan

will be added to your income

and taxed as per your income

slab.

For example, let's assume you

have invested 10 lakh in an

immediate annuity plan and it

gives you an annual pension of

80,000. Apart from this

income, you have a rental

income of 1.80 lakh and

interest income from various

fixed deposits amounting to

`

`

`

`

`

Q:

A:

38

ASK OUR PLANNER


Do you also have similar queries to ask our experts? Write to us at: [email protected].

60,000 p.a. Then, your total

income for the year will be

3.20 lakh. If you are 60 and

above (but less than 80 years of

age), then 3 lakh will be

deducted from this and the

balance amount of 20,000 will

be taxed at 10.30%, amounting

to an income tax of 2,060. If

you are less than 60, then 2.5

lakh will be deducted and

70,000 will be taxed at

10.30%, amounting to an

income tax of 7,210.

Kindly let me know whether I

can invest 50,000 for saving tax

u/s 80CCD (1); my age is above 75

years.

- Harbanslal Nagee

The normal maturity age in a

National Pension System

(NPS) account is 60 years.

However, you can extend

contributions / lump sum

withdrawal up to the age of

only 70 years and not beyond

it. Hence, you will not be able

to invest into NPS to claim tax

exemption under Section

80CCD (1).

`

`

`

`

`

`

`

`

Q:

A:

Q:

A:

Can I partially withdraw/redeem

amount from my fund in my pension

policy (ICICI Prudential Life Time

Pension Plan)? How long will it

take? Or can I avail loan against

this?

- P Vijay

You can do a partial

withdrawal from your pension

policy, if the policy allows you

to do so. There could be

conditions with respect to the

minimum duration you should

have held the policy before

being eligible for partial

withdrawal. Please check your

policy document for the same.

Generally, partial withdrawal

requests will be processed in 3-

4 working days.

Loans are generally available

against traditional insurance

policies like endowment &

money back policies. Since

unit-linked plans are linked to

market and the fund value may

fluctuate according to market

movements, loan against

these policies are generally not

provided.

MUTUAL FUND ANALYSIS

39

Investing in Income Funds


The Reserve Bank of India (RBI) in its monetary policy of April 5, 2016 announced several liquidity measures, which are extremely positive for funds at the short to medium term maturity papers. Therefore, bulk of the debt investment should be in good quality short-term debt funds. Ultra short-term debt funds and liquid funds are likely to benefit from the fall in short-term yields. Investors can consider investing in the following short-term debt funds: Birla Sunlife Short Term Fund, HDFC Short Term Opportunities Fund and ICICI Pru Short Term Plan.

Birla Sun Life Short Term Fund

Fund Objective:The scheme aims to generate current income and capital appreciation from a portfolio that invests 100% in debt and money market securities.

Key Information:

Product Label:

This product is suitable for investors who are seeking*:

•

•

income with capital growth over short term

investments in debt and money market instruments.

NAV as on April 07, 2016 ( ) 57.1

Inception Date March 3, 1997

Fund Manager Prasad Dhonde

Minimum Investment (`)

Lumpsum 5000

Expense Ratio (%) 0.30

Last declared YTM 8.20

Exit Load Nil

Benchmark Crisil Short TermBond Fund Index

Modified Duration 1.73

`

Fund Manager: Prasad DhondeMr. Dhonde

Performance:

is a B.Sc (Tech) and MMS (Finance). Prior to joining Birla Sun Life AMC he has worked with Credit Analysis & Research Ltd, Times Investors Services Pvt. Ltd., Birla Sun Li fe Securi t ies Ltd. , RR Financial Consultants Ltd. & Probity Research & Services Pvt. Ltd.

The fund has delivered returns better than the benchmark over 6 months, 1 year, 3 year and 5 year time. It delivered 9% CAGR (compounded annual growth rate) over period of 1 year as against benchmark which delivered 8.7%. It has delivered 9.5% CAGR return since inception whereas c a t e g o r y a v e r a g e h a s delivered 8.9% CAGR returns only. It has been consistent in its performance and has always been among top performing funds.

40



Portfolio:The scheme seeks to generate

regular returns by investing in

short-term corporate bonds

and sovereign bonds. The fund

has dynamic a l locat ion

strategy and has increased the

percentage of cash holdings in

volatile market. The fund holds

33% sovereign bonds, 46%

AAA-rated corporate bonds

and 7% AA-rated papers. It

doesn't invest in sub-AA

papers. Average maturity of

the fund is 2.01 years and

modified duration is 1.73

years. (Modified Duration is

the approximate percentage

change in price for a 100 basis

point change in interest rates.)

Our View:The fund has been consistent

in its performance with

portfolio inclined towards

short term sovereign bonds

and corporate bonds. It has

always been among the top

performers and delivered

better returns than category

average and the benchmark.

With government resorting to

short term liquidity easing

measures, short-term debt

funds are going to benefit the

most. Higher accrual income

and held to maturity portfolio

(with less duration of about

two years) make these funds

comparatively less volatile as

against long term funds. Short

term debt funds are stable

performing funds with low

volatility in returns, apt for the

current volatile environment.

Performance vs. Benchmark

Fund Benchmark

4.4

9 9.4 9.7

4.1

8.7 9.2

9

02468

1012

6 Month 1 Year 3 Year 5 Year

Retu

rn%

8.7 1

0.9

8.71

0.3

8.8

0.0

2.0

4.0

6.0

8.0

10.0

12.0

31-Mar-15 To 31-Mar-16 31-Mar-14 To 31-Mar-15 31-Mar-13 To 31-Mar-14

Retu

rn%

Yearly Returns

Fund BenchMark

41



Performance of all the schemes managed by the fund manager

31 -Mar-15 -14 -13

31 -Mar-16 31 -Mar-15 31 -Mar-14

31 -Mar 31 -MarFund Name

Data as on April 07, 2016; Portfolio details as on Feb-2016Source: ACE MF, ICICIdirect Research

Feb-16 Jan-16 Dec-15 Nov-15 Oct-15 Sep-15 Aug-15 Jul-15 Jun-15 Apr-15 Mar-15 Feb-15 Jan-15 Dec-14

Avg Maturity(Yrs) 2.01 2.39 2.46 2.17 2.01 2.26 2.15

Modified Duration 1.73 2.04 2.01 1.81 1.67 1.90 1.88 1.99 1.95 1.69 1.77 1.68 1.78 1.92

Asset Allocation %

Credit quality %

Other attributes (Years)

Others 11.79 9.01 6.98 8.81 13.18 3.60 5.59 9.96 16.79 5.36 3.50 15.04 10.46 6.48

Gsec 33.96 40.41 39.37 32.26 34.27 37.70 33.33 24.18 22.59 14.09 15.34 20.07 23.66 26.24

Corp Bond 36.28 36.08 41.89 44.92 36.27 42.24 42.93 50.73 51.50 61.70 68.70 58.35 63.25 66.31

CPs 14.97 9.23 3.96 6.55 7.39 6.14 6.77 4.01 3.84 6.74 8.35 2.30 2.47 0.80

CDs 3.01 5.27 7.80 7.46 8.89 10.32 11.38 11.12 5.28 12.11 4.11 4.24 0.16 0.17

Others -- -- -- -- -- -- -- -- -- -- -- -- -- --

SOV 33.96 40.41 39.37 32.26 34.27 37.70 33.44 24.30 22.71 14.22 15.39 29.76 26.88 27.91

Cash & Equivalent 11.79 7.96 6.98 8.81 13.18 3.60 5.48 9.84 11.77 5.23 3.44 5.35 5.61 2.82

AAA & Equiv 46.52 42.17 44.09 46.60 39.58 44.19 48.49 51.49 47.15 66.43 68.46 51.39 51.80 52.45

AA & Equiv 7.74 8.41 9.55 12.33 12.97 14.51 12.59 14.37 13.48 14.12 12.70 13.50 14.08 14.82

A & Eqiv -- -- -- -- -- -- -- -- -- -- -- -- -- --

Birla SL Gold ETF 10.14 -10.29 -3.81

Gold-India -- -8.38 -3.19

Birla SL Short Term Fund(G) 8.70 10.88 8.73

Crisil Short Term Bond Fund Index -- 10.33 8.79

Birla SL FRF-Long Term Plan-Ret(G) 8.63 9.35 9.76

Crisil Liquid Fund Index -- 8.98 9.46

Birla SL Treasury Optimizer Plan-Ret(G) 8.59 12.37 9.92


Birla SL Constant Maturity 10 Year Gilt Fund-Reg(G) 7.40 13.12 -0.40

I-Sec Li-BEX -- 19.88 1.72

Birla SL Inv Inc-QS I-Ret(G) 7.23 8.79 9.86


Birla SL Qrtly Inv 4(G) 7.07 8.43 9.62


Birla SL Gilt Plus-PF(G) 6.32 20.27 2.69

I-Sec Li-BEX -- 19.88 1.72

Birla SL G-Sec-LT(G) 5.86 18.14 2.27

I-Sec Li-BEX -- 19.88 1.72

Birla SL Income Plus(G) 4.69 16.79 1.57

Crisil Composite Bond Fund Index -- 14.59 4.34

Birla SL CPO Fund-Sr 23 4.28 – –


Birla SL CPO Fund-Sr 18 4.10 14.38 –

Crisil MIP Blended Index -- 16.45 –









Birla SL Dynamic Asset Allocation Fund(G) 1.30 23.03 13.04

CRISIL Balanced Fund - Aggressive Index -- 22.53 13.38

Birla SL CPO Fund-Sr 25 -1.10 -- –

42


HDFC Short-term Opportunities Fund

Fund Objective:The investment objective of the Scheme is to generate regular income through investments in Debt/Money Market Instruments and Government Securities with maturities not exceeding 30 months.


•

•

Regular income over short to medium term.

l Investment in debt and money market ins t ruments and government securities with maturities not exceeding 36 months.


Key Information:

Product Label:

Fund Managers: Anil Bamboli

Mr. Bamboli

Performance:

is a CFA and managed multiple funds in HDFC since 2010. Prior to joining HDFC AMC he has w o r k e d w i t h S B I Fu n d Management for 11 years.

The fund has been a consistent top performing fund in short term debt funds category. It has delivered 1-year return of 8.5% against benchmark return of 8.7%. On 5-year basis, it has delivered 9.4% CAGR return as against 9% return of benchmark. Its CAGR return since inception stands at 9 .1% whereas category average has delivered 8.9% return over same period.

Yearly Returns

Fund BenchMark

NAV as on April 07, 2016 ( ) 16.6

Inception Date June 25, 2010

Fund Manager Anil Bamboli

Minimum Investment (`)Lumpsum 5000



Exit Load 0.25% on or before 1M, Nil after 1M



`

8.4 1

0.3

8.81

0.3

8.8

0.0

2.0

4.0

6.0

8.0

10.0

12.0

31-Mar-15 To 31-Mar-16 31-Mar-14 To 31-Mar-15 31-Mar-13 To 31-Mar-14

Retu

rn%


Fund Benchmark

4.1

8.5 9.2

9.4

4.1

8.7

9.2 9

0

2

4

6

8

10


Retu

rn%

43



Portfolio:The scheme invests in short-term corporate bonds of AAA and AA-rated papers and in sovereign bonds. It has drastical ly increased its holdings in sovereign bonds from 0.8% in February 2015 to 10.8% in February 2016. It has also decreased its holding in sub-AAA rated papers due to increasing credit risk in the market. It holds 5% cash for l i q u i d i t y r e q u i r e m e n t s . Average maturity for the fund is 1.66 years and modified durat ion is 1 .40 years . (Modified Duration is the approximate percentage change in price for a 100 basis point change in rates).

Our View:The fund holds short-term papers in sovereign as well as corporate bonds. In i ts monetary policy RBI has taken dras t ic l iqu id i ty eas ing measures which are going to be positive for the short term interest rates and hence short term debt funds. Higher accrual income and held to maturity portfolio (with less duration of about two years) m a k e t h e s e f u n d s comparatively less volatile as against long term funds. Short term debt funds are stable performing funds with low volatility in returns, apt for the current volatile environment.

Feb-16 Jan-16 Dec-15 Nov-15 Oct-15 Sep-15 Aug-15 Jul-15 Jun-15 May-15 Apr-15 Mar-15 Feb-15 Jan-15

CDs 4.90 6.33 5.11 3.06 4.72 7.93 12.71 13.19 11.68 12.12 12.60 6.60 6.51 6.63

CPs 2.49 4.92 2.84 7.29 3.95 3.45 4.11 3.94 4.18 5.42 5.17 4.42 2.20 2.48

Corp Bond 76.07 71.33 74.06 71.03 73.80 71.96 59.56 68.49 71.29 70.44 69.13 74.92 84.01 85.70

Gsec 10.81 12.34 16.65 15.04 15.57 12.83 12.19 6.33 4.92 5.11 4.51 0.76 0.87 0.99

Others 5.72 5.09 1.35 3.59 1.96 3.83 11.43 8.05 7.93 6.91 8.59 13.30 6.41 4.20

A & Eqiv -- -- -- 1.55 -- -- -- -- -- -- -- -- -- --

AA & Equiv 10.92 17.35 19.24 20.51 22.84 21.50 15.85 17.41 18.24 17.44 15.87 15.05 19.55 20.47

AAA & Equiv 72.54 65.22 62.77 59.31 59.63 61.84 60.52 68.21 68.91 70.54 71.03 70.89 73.17 74.34

Cash & Equivalent 5.72 3.51 1.35 3.59 1.96 3.83 11.43 8.05 5.75 3.63 2.67 4.08 6.41 4.20

SOV 10.81 12.34 16.65 15.04 15.57 12.83 12.19 6.33 4.92 5.11 4.51 0.76 0.87 0.99

Others -- -- -- -- -- -- -- -- -- -- -- -- -- --

Avg Maturity(Yrs) 1.66 1.68 1.80 1.81 1.90 1.88 1.61 1.72 1.73 1.71 1.69 1.69 1.74 1.71


Asset Allocation %

Credit quality %


44




31 -Dec-14 -13 -12

31 -Dec-15 31 -Dec-14 31 -Dec-13

31-Dec 31 -DecFund Name

HDFC FMP-XXIX-1175D-Jan 2014(1)-Reg(G) 10.64 12.87 –

Crisil Composite Bond Fund Index -- 14.59 –

HDFC FMP-XXIX-1127D-Mar 2014(1)-Reg(G) 10.62 12.73 –



Crisil Short Term Bond Fund Index -- 10.33 –

HDFC FMP-XXIX-793D-Feb 2014(1)-Reg(G) 9.49 11.81 –


HDFC STP(G) 9.38 10.98 7.85


HDFC Gilt-Short Term Plan(G) 9.30 10.09 5.94

I-Sec Si-BEX -- 9.75 6.62

HDFC FMP-XXXII-1134D-Sep 2014(1)-Reg(G) 8.93 – –

HDFC Banking and PSU Debt Fund-Reg(G) 8.93 9.95 –


HDFC Annual Inv-1-A-Reg(G) 8.71 9.30 9.43






HDFC Annual Inv-1-B-Reg(G) 8.57 9.33 9.21




HDFC FMP-XXXII-1107D-Oct 2014(1)-Reg(G) 8.55 – –

HDFC FMP-XXVIII-370D-Oct 2013(2)-Reg(G) 8.53 9.55 –






HDFC FMP-XXXII-1099D-Aug 2014(1)-Reg(G) 8.52 -- –






HDFC FMP-XXXII-1113D-Oct 2014(1)-Reg(G) 8.51 – –



45




31 -Dec-14 -13 -12

31 -Dec-15 31 -Dec-14 31 -Dec-13










Data as on April 07,2016 ;Portfolio details as on Feb-2016 10.33 –



HDFC FMP-XXXII-1115D-Jan 2015(1)-Reg(G) 8.48 – –

HDFC FMP-XXXII-1113D-Nov 2014(1)-Reg(G) 8.48 -- –

HDFC FMP-XXIX-370D-Feb 2014(1)-Reg(G) 8.48


HDFC FMP-XXVI-370D-Aug 2013(2)-Reg(G) 8.47 9.86 –








HDFC FMP-XXVII-370D-Sep 2013(1)-Reg(G) 8.46 9.96 –


HDFC FMP-XXVI-370D-Aug 2013(1)-Reg(G) 8.46 9.85 –




HDFC FMP-XXVI-371D-July 2013(1)-Reg(G) 8.45 9.30 –






HDFC FMP-XXVII-370D-Aug 2013(4)-Reg(G) 8.44 9.87 –






46




31 -Dec-14 -13 -12

31 -Dec-15 31 -Dec-14 31 -Dec-13


HDFC FMP-XXIX-372D-Dec 2013(1)-Reg(G) 8.43 9.25 –




HDFC Short Term Opportunities Fund(G) 8.43 10.26 8.78








HDFC FMP-XXVIII-370D-Oct 2013(1)-Reg(G) 8.40 10.00 –


HDFC FMP-XXVI-370D-July 2013(3)-Reg(G) 8.39 9.97 –










HDFC FMP-XXXII-1113D-Aug 2014(1)-Reg(G) 8.37 – –





HDFC FMP-XXVII-371D-Aug 2013(1)-Reg(G) 8.34 9.45 -




HDFC FMP-XXXII-1107D-Dec 2014(1)-Reg(G) 8.31 -- –



HDFC FMP-XXVII-1143D-July 2013(1)-Reg(G) 8.23 10.23 –





47




31 -Dec-14 -13 -12

31 -Dec-15 31 -Dec-14 31 -Dec-13









HDFC Cash Mgmt-Savings(G) 8.10 8.95 9.44


HDFC FMP-XXXII-1111D-Nov 2014(1)-Reg(G) 8.01 – –





HDFC Cash Mgmt-Call(G) 7.09 8.03 8.39


HDFC Debt Fund for Cancer Cure-Reg-50 per Div Don 6.53 8.81 –


HDFC Debt Fund for Cancer Cure-Reg-100 per Div Don 6.53 8.81 –


HDFC Gilt-Long Term Plan(G) 6.37 19.59 1.58

I-Sec Li-BEX -- 19.88 1.72

HDFC High Interest Fund-Dynamic Plan(G) 5.75 16.77 5.30


HDFC CPO Fund-III-1173D-Jan15-Reg(G) 4.42 – –

HDFC CPO Fund-III-1100D-Oct14-Reg(G) 3.79 -- –

HDFC CPO Fund-I-36M-Oct13-Reg(G) 3.77 11.36 –


HDFC CPO Fund-III-1207D-Dec14-Reg(G) 3.68 -- –

HDFC CPO Fund-II-36M-May14-Reg(G) 3.60 -- –

HDFC CPO Fund-II-36M-June14-Reg(G) 3.57 – –

HDFC CPO Fund-II-36M-Feb14-Reg(G) 3.50 10.70 --


HDFC CPO Fund-I-36M-Aug13-Reg(G) 3.46 11.00 –


HDFC CPO Fund-II-36M-Jan14-Reg(G) 3.37 11.42 –


HDFC CPO Fund-I-36M-Sep13-Reg(G) 3.33 11.09 –

Crisil MIP Blended Index -- 16.45 --


48


ICICI Prudential Short Term Plan

Fund Objective:To generate income through investment in basket of debt securities and money market instruments.


Fund Managers: Manish BanthiaMr. Manish Banthia

Performance:

is B.Com, ACA

and MBA. He joined ICICI

prudential in 2012.

The fund has performed well over

the years except from Nov 2009

through May 2014 during which

t i m e t h e f u n d h a s

underperformed 66% of its

category peers. The fund

manager plays through duration

management and spread analysis

and invests in corporate bonds,

gilts and cash. The fund has

delivered 8.6% return against

8.75% benchmark return in 1 year.

For 5-year period it has delivered

9.2% CAGR return against 9%

CAGR return of benchmark.

Key Information:

Product Label:


•

•

Short term income generation and capital appreciation solution

A debt fund that aims to generate income by investing in a range of debt and money market instruments of various maturities.

NAV as on April 07, 2016 ( ) 31.1

Inception Date October 29, 2001

Fund Manager Manish Banthia

Minimum Investment (`)

Lumpsum 5000



Exit Load Nil



`

Yearly Returns

Fund BenchMark

8.1

11.5

7.3

10.3

8.8

0.02.04.06.08.0

10.012.014.0

Retu

rn%

31-Mar-15 To 31-Mar-16 31-Mar14 To 31-Mar-15 31-Mar-13 To 31-Mar-14


Fund Benchmark

4.1

8.6 9 9.2

4.1

8.7

9.2 9

0

2

4

6

8

10


Retu

rn%

49



Portfolio:

Our View:

The scheme invests heavily in

sovereign funds with holding

percentage in the same at

44%. Its current holding in

AAA-rated corporate bond

papers is 39%. It has reduced

its holdings in sub-AAA papers

due to increasing credit risk in

the market. I ts average

maturity is 4.76 years and its

modified duration is 3.47

years. (Modified Duration is

the approximate percentage

change in price for a 100 basis

point change in rates).

The fund holds short to

medium term papers in

sovereign as well as corporate

bonds. In its monetary policy

RBI has taken drastic liquidity

easing measures which are

going to be positive for the

short term interest rates and

hence short term debt funds.

Higher accrual income and

held to maturity portfolio (with

less duration of about two

years) make these funds

comparatively less volatile as

against long term funds. Short

term debt funds are stable

performing funds with low

volatility in returns, apt for the

current volatile environment.

Feb-16 Jan-16 Dec-15 Nov-15 Oct-15 Sep-15 Aug-15 Jul-15 Jun-15 May-15 Apr-15 Mar-15 Feb-15 Jan-15

CDs -- -- -- -- -- -- -- -- -- 0.46 1.85 0.46 8.12 4.54

CPs -- -- -- -- -- -- -- -- 3.30 3.65 3.64 3.70 5.40 1.70

Corp Bond 50.79 57.00 60.50 57.28 61.46 65.50 63.57 65.75 66.64 68.79 66.31 62.86 53.47 54.05

Gsec 44.31 39.30 34.73 35.20 34.28 31.03 33.29 28.51 27.32 23.39 25.02 28.60 28.66 28.80

Others 4.90 3.70 4.77 7.52 4.26 3.47 3.13 5.74 2.74 3.71 3.18 4.37 4.34 10.91

A & Eqiv -- -- -- -- -- -- -- -- -- -- 0.98 1.01 1.06 1.16

AA & Equiv 12.50 22.32 24.08 24.36 21.27 23.05 22.31 26.20 28.70 27.91 27.00 27.19 26.65 27.12

AAA & Equiv 38.29 34.69 36.41 32.92 40.19 42.45 41.26 39.55 41.23 44.98 43.82 38.83 39.28 32.01

Cash & Equivalent 4.90 3.70 4.77 7.52 4.26 3.47 3.13 5.74 2.74 3.71 3.18 4.37 4.34 10.91

SOV 44.31 39.30 34.73 35.20 34.28 31.03 33.29 28.51 27.32 23.39 25.02 28.60 28.66 28.80

Others -- -- -- -- -- -- -- -- -- -- -- -- -- --

Avg Maturity(Yrs) 4.76 4.55 4.29 4.16 4.65 4.60 4.51 3.82 3.30 3.16 3.03 3.04 2.72 2.80


Asset Allocation %

Credit quality %


50




31 -Dec-14 -13 -12

31 -Dec-15 31 -Dec-14 31 -Dec-13

31 -Dec 31 -DecFund Name


ICICI Pru Gold ETF 9.88 -6.18 -7.45

Gold-India -- -8.38 -3.19

ICICI Pru Short Term Plan(G) 8.12 11.50 7.26


ICICI Pru Income Opportunities Fund(G) 7.40 15.30 4.55


ICICI Pru Regular Gold Savings Fund(G) 7.13 -10.96 -2.47

Gold-India -- -8.38 -3.19

ICICI Pru Long Term Plan-Ret(G) 6.79 20.29 9.43


ICICI Pru Gilt-Invest-PF(G) 6.23 20.31 1.43

I-Sec Li-BEX -- 19.88 1.72

ICICI Pru Income(G) 5.73 17.41 0.74


ICICI Pru Balanced Advantage Fund(G) 1.10 26.61 20.59

CRISIL Balanced Fund - Aggressive Index -- 22.53 13.38

51

MUTUAL FUND TOP PICKS

Based on our quarterly rankings, we have updated our mutual fund (MF) top picks recently

Mutual Fund Top Picks

Equity

Largecaps

Midcaps

Diversified

ELSS

Birla Sunlife Frontline equity FundICICI Pru Focussed Bluechip Equity FundSBI Bluechip Fund

HDFC Midcap Opportunities FundFranklin India Smaller Companies FundSBI Magnum Global Fund

Franklin India Prima PlusReliance Equity OpportunitiesICICI Prudential Value Discovery Fund

Axis Long Term EquityICICI Prudential Tax PlanFranklin India Tax shield

Liquid Funds

HDFC Cash Mgmnt Saving Plan ICIC Pru Liquid PlanReliance Liquid Treasury Plan

Ultra Short Term

Birla Sunlife Savings FundReliance Medium Term FundICICI Pru Flexible Income Plan

Short Term

Birla Sunlife Short Term FundHDFC Short Term Opportunities FundICICI Pru Short Term Plan

Credit Opportunities FundBirla Sunlife Short Term Opportunities PlanReliance Regular Savings FundICICI Prudential Regular Savings

Income FundsICICI PrudenIncome FundBirla Sun Life Income Plus - Regular Plan UTI Bond Fund

Gilts Funds

ICICI Pru Gilt Inv. PF PlanBirla Sunlife Constant Maturity 10 year gilt plan

MIP Aggressive

Birla Sunlife Savings 5ICICI Prudential MIP 25DSP Blackrock MIP

Debt


52

Our indicative large-cap equity model portfolio (“Quality-21”) has

continued to deliver an impressive return of 99.8% (inclusive of

dividends) till date (as on April 12, 2016) since its inception (June

21, 2011) vis-à-vis the benchmark index (S&P BSE Sensex) return

of 43.2% during the same period, out-performance of over

56.6%. This validates our thesis of selecting companies with

sound business fundamentals that forms the core theme of our

portfolio. Our “Consistent-15” mid-cap portfolio also continues

to outperform, delivering 119.5% (inclusive of dividends) till date

(as on April 12, 2016) vis-à-vis the benchmark index (CNX

Midcap) return of 44.4%, out-performance of 75%. Our

consistent outperformance demonstrates our superior stock

picking ability as markets in H1CY15 aligned to our view of

favourable risk reward, good franchisee vs. reward-at-any-risk

businesses. Some key performers of our portfolio are Lupin, Axis

Bank and TCS in the large-cap portfolio while Natco Pharma and

Shree Cement have delivered stupendous returns in the mid-cap

portfolio.

We have always suggested the systematic investment plan (SIP)

mode of investment and still find a lot of merit in it as the

preferred mode of deployment given the market conditions and

volatility associated since the inception of the portfolio. It has

outperformed other portfolios, thus, reinforcing our belief in a

plan of investment. However, now we are also advising clients to

look at lump sum investments on any possible dips.

On a year-to-date (YTD) basis, the markets have been

consolidating in a broad range of 8,000-8,800 on the Nifty. This is

owing to: a) markets awaiting a turnaround on the ground and,

hence, corporate earnings and b) taking a breather post a

stupendous rise witnessed in CY14, wherein valuations in some

areas were ahead of fundamentals. Going ahead, in the medium

term, stocks with reasonable earnings visibility and valuations

should do well and will find flavour among investors.

On the back of this run up in stock prices and valuations running

EQUITY MODEL PORTFOLIO


53


ahead of fundamentals, we have aligned our portfolio to capture

the new opportunities available in the market. We have replaced

Bajaj Auto with Maruti and Titan Company with Asian Paints.

Furthermore, we have transferred Bosch which was earlier a part

of the mid-cap portfolio to the large-cap portfolio. Apart from

shuffling stocks, we have also increased/reduced the allocation

weights of some companies.

In the large-cap space as compared to broader indices we

continue to remain overweight on Pharma & IT, following which

FMCG forms the major portion of the asset allocation. We

continue to remain underweight on metals and oil & gas with our

only pick being ONGC and Tata Steel, which have a better risk-

reward opportunity. We believe that return on investment (RoI)

for these sectors would continue to remain stressed due to a

subdued pricing environment and discreet trade activities. We

continue to remain over-weight to neutral on pure play

defensives (IT, FMCG) as secular earnings coupled with sector

rotation could lead to consolidation in near term valuations and

offer stock specific opportunities. We remain positive on auto,

pharma, capital goods and infrastructure.

Among individual names, we are strongly overweight on Infosys,

TCS in the IT space, HDFC and HDFC Bank in the BFSI space, ITC

and PVR in consumer space and L&T and NBCC in the infra space.

House view on Index: Factoring in the fall in inflation, comfortable

CAD (current account deficit), improved sentiments and pick-up

in GDP (gross domestic product) growth, we expect Sensex EPS

(earnings per share) to grow 13.2% and 19.4% to Rs. 1,539 and

Rs. 1,838 during FY16E and FY17E, respectively (CAGR of 16% in

FY15-17E). We assign a P/E (price-to-earnings) multiple of 16.5x

on FY17E EPS to arrive at a fair value of 30,300 for the Sensex by

end CY15 with the Nifty estimated to reach 9,100.


54

Name of the company

Largecap Stocks

Model Portfolio

Largecap(%)

Midcap(%)

Diversified(%)



Auto 14 9.8

Tata Motor DVR 4 2.8

Bosch 3 2.1

Maruti 4 2.8

EICHER Motors 3 2.1

BFSI 23 16.1

HDFC Bank 8 5.6

Axis Bank 3 2.1

HDFC 8 5.6

Bajaj Finance 4 2.8

Capital Goods 5 3.5

L & T 5 3.5

Cement 3 2.1

UltraTech Cement 3 2.1

FMCG/Consumer 14 9.8

ITC 7 4.9

United Spirits 2 1.4

Asian Paints 5 3.5

IT 21 14.7

Infosys 10 7.0

TCS 8 5.6

Wipro 3 2.1

Meida 2 1.4

Zee Entertainment 2 1.4

Metal 2 1.4

Tata Steel 2 1.4

Oil & Gas 4 2.8

Reliance Industries 4 2.8

Pharma 12 8.4

Lupin 5 3.5

Dr Reddys 4 2.8

Aurobindo Pharma 3 2.1

Largecap share in diversified 100 70

55



Aviation 6.0 1.80

Interglobe Aviation 6.0 1.80

Auto 6.0 1.80

Bharat Forge 6.0 1.80

BFSI 6.0 1.80

Bajaj Finserve 6.0 1.80

Capital Goods 6.0 1.80

Bharat Electronics 6.0 1.80

Cement 6.0 1.80

Ramco Cement 6.0 1.80

Consumer 24.0 7.20

Symphony 6.0 1.80

Supreme Ind 6.0 1.80

Kansai Nerolac 6.0 1.80

Pidilite 6.0 1.80

FMCG 8.0 2.40

Nestle 8.0 2.40

Infrastructure 8.0 2.40

NBCC 8.0 2.40

Oil & Gas 6.0 1.80

Castrol 6.0 1.80

Logistics 6.0 1.80

Container Corporation of India 6.0 1.80

Pharma 12.0 3.60

Natco Pharma 6.0 1.80

Torrent Pharma 6.0 1.80

Textile 6.0 1.80

Arvind 6.0 1.80

Midcap share in diversified 100 30

TOTAL 100 100 100.0

5,90

0,00

0

5,90

0,00

0

5,90

0,00

0

7,04

3,61

6

10,1

59,6

78

7,73

2,61

9

6,78

3,04

8

5,55

1,58

1 7,30

5,74

3

3500000

4500000

5500000

6500000

7500000

8500000

|

56

Performance* so far Since inception

*Returns (in %) as on

Large-cap Portfolio Benchmark: BSE Sensex; Mid-cap Portfolio

Benchmark: CNX Midcap; Diversified Portfolio Benchmark: Combination

of BSE Sensex and CNX Midcap

April 12, 2016

Value of 1,00,000 invested via SIP at the end of every month `

Portfolio Benchmark

Investment Value of Investment in Portfolio Value if invested in Benchmark

Start date of SIP: , 2011; *Value as on June 30 , 2016April 12



99.8

119.5111.1

43.2 44.4 49.0

0

25

50

75

100

125

150

%

QUIZ TIME

1. If you had invested into Senior Citizen Savings Scheme (SCSS) on or before 31st March 2016, the new rates would be applicable to you. True / False

2. The National Payments Corporation of India (NPCI) has recently unveiled an app called _______, which will help you transfer money as simple as sending a text message on a mobile phone.

3. Long-term capital gains on properties are currently taxed at _____% (including cess) after indexation.

4. Immediate annuity plans are tax-free. True / False

5. Anyone can subscribe to the National Pension System (NPS), including a person aged 75. True / False

Note: All the answers are in the stories that have appeared in this edition of ICICIdirect Money Manager. You may send in your answers at: [email protected]. The answers will be published in our next edition. The names of the earliest all correct entries will be published too. So jog your grey cells and be quick to send in your entries.

Correct answers for the March 2015 quiz are:

1. The government has recently cut interest rate on Public Provident Fund (PPF) to _____% from 8.7% now.

A: 8.1%

2. Tax rebate, under Budget 2016-17 proposals, has been raised to Rs. 3,000 fom Rs. 2,000 currently. True / False

A: False, it's increased to Rs. 5,000

3. Leave encashment amount received any time is entirely tax-free for all employees. True / False

A: False

4. Under Budget 2016-17 proposals, tax deduction for rent paid under section 80GG has been increased to Rs. _____ p.a. from Rs. 24,000 p.a. currently.

A: Rs. 60,000

5. Sixty per cent of your NPS (National Pension System) accumulations at the time of withdrawals will be tax exempt once the Budget proposals come into force. True / False

A: False, 40% would be tax-free

Congratulations to the following winner for providing correct answers!

B S R Murthy


58

PRIME NUMBERS

Equity Markets


Domestic Equity Indices

Global Equity Indices

Sectoral Indices

31-Mar-16 29-Feb-16 Change (%)

CNX Nifty 7738.4 6987.1 10.8%

CNX Midcap 12752.6 11558.7 10.3%

S&P BSE Sensex 25341.9 23002.0 10.2%

S&P BSE 100 7835.5 7075.4 10.7%

S&P BSE 200 3259.4 2946.8 10.6%

S&P BSE 500 10185.1 9206.0 10.6%


Dow Jones 17,685.1 16,516.5 7.1%

S&P 500 2,059.7 1,932.2 6.6%

Nasdaq 4,869.8 4,558.0 6.8%

FTSE 6,174.9 6,097.1 1.3%

DAX 9,965.5 9,495.4 5.0%

CAC 40 4,385.1 4,353.6 0.7%

Nikkei 16,758.7 16,026.8 4.6%

Hang Seng 20,776.7 19,111.9 8.7%

Shanghai Composite 3,003.9 2,688.0 11.8%

Taiwan Weighted 8,744.8 8,411.2 4.0%

Straits Times 2,840.9 2,666.5 6.5%


S&P BSE Auto 18,001.8 15,851.6 13.6%

S&P BSE Bankex 18,392.0 15,814.8 16.3%

S&P BSE FMCG 4,163,635 3,845,354 8.3%

S&P BSE Healthcare 15,149.3 15,207.7 -0.4%

S&P BSE Metals 7,540.8 6,759.2 11.6%

S&P BSE Oil & Gas 9,161.6 8,214.2 11.5%

S&P BSE Power 1,775.7 1,582.5 12.2%

S&P BSE Realty 1,228.4 1,051.1 16.9%

S&P BSE Teck 6,104.9 5,513.6 10.7%

59

PRIME NUMBERS


Debt Markets

Government Securities (G-Sec) Yields (in %) Mar-16 -16 Change (bps)Feb

Corporate Bond Yields (in %) Change (bps)Mar Feb-16 -16

Commercial Paper (CP) Rates (in %) Change (bps)Mar Feb-16 -16

Treasury Bill (T-Bills) Yields (in %) Change (bps)Mar Feb-16 -16

Volatility Index (VIX)


VIX 16.58 20.16 -17.7%

10 year 7.51 7.63 -11

5 year 7.55 7.64 -9

3 year 7.30 7.98 -68

1 year 7.34 7.34 -1

AAA 10 year 8.47 8.67 -19.8

AAA 5 year 8.36 8.59 -23.0

AAA 3 year 8.30 8.53 -22.6

AAA 1 year 8.27 8.47 -19.9

AA 10 year 9.08 9.14 -6.3

AA 5 year 9.05 9.08 -3.5

AA 3 year 8.99 9.01 -1.9

AA 1 year 8.91 8.90 0.6

12 Months 8.86 9.24 -38

6 Months 8.80 9.23 -42

3 Months 8.74 9.28 -54

1 Month 8.70 8.53 17

91D TB 7.24 7.26 -2.4

182D TB 7.17 7.26 -8.5

364D TB 7.10 7.25 -14.8

60

PRIME NUMBERS

10-year benchmark yields (%) across countries

Macro-economic Indicators

Consumer price index (CPI)

Wholesale price index (WPI)


Month

Countries 31-Mar-16 29-Feb-16 Change in bps

US 1.77 1.73 3

UK 1.42 1.34 8

Japan (0.03) (0.06) 3

Spain 1.43 1.53 (9)

Germany 0.15 0.11 5

France 0.49 0.47 2

Italy 1.22 1.42 (20)

Brazil 13.97 16.06 (209)

China 2.89 2.90 (1)

India 7.47 7.63 (16)

Items Weights Mar-16 Feb-16 Jan-16Food&bev. 45.86 5.27 5.52 6.66

Pan,tob& intox. 2.38 8.51 8.46 9.03

Cloth & Foot 6.53 5.50 5.60 5.71

Housing 10.07 5.31 5.33 5.20

Fuel & light 6.84 3.38 4.59 5.32

Misc. 28.31 4.01 4.38 3.95

CPI 100 4.83 5.26 5.69

Weights Mar-16 Feb-16 Jan-16WPI 100.0 -0.85 -0.91 -1.07 Primary Articles 20.1 2.13 1.58 4.30 Fuel & Power 14.9 -8.30 -6.40 -9.89 Manufactured Goods 65.0 -0.13 -0.58 -1.17

Index of industrial production (IIP) Sector-wise growth rate (%)Categories Feb-16 Jan-16 Dec-15 Weight (%)

Mining 5 1.5 2.7 14.2Manufacturing 0.7 -2.8 -2.2 75.5Electricity 9.6 6.6 3.2 10.3Total 2 -1.5 -1.2 100.0

61

PRIME NUMBERS

Currencies and CommoditiesCurrencies

Commodities

Sources for above data: Bloomberg, Reuters, CRISIL, MOSPI, ICICIdirect.com Research


31-Mar-16 29-Feb-16 Change (%) StatusUSDINR 66.25 68.42 3.2% AppreciatedEURINR 75.37 74.49 -1.2% DepreciatedGBPINR 95.45 94.80 -0.7% DepreciatedAUDINR 50.95 48.89 -4.2% DepreciatedCHFINR 68.93 68.28 -1.0% DepreciatedJPYINR 0.59 0.61 2.7% AppreciatedCNYINR 10.27 10.44 1.7% Appreciated

31-Mar-16 29-Feb-16 Change (%)Crude ($/barrel) 39.6 36.0 10.1%Gold ($/ounce) 1,232.7 1,238.7 -0.5%

62

ICICIdirect Centre for Financial Learning (ICFL) imparts quality education on financial markets to beginners and amateurs, student, housewives, working professionals and self employed. ICFL's broad objective is to make participant feel confident to start investing in stock market.

Here is the list of our programmes scheduled for the month of April, 2016.

Schedule for Beginners' programme on Futures and Options (F&O) TradingSr.No

City Dates For More Information & Registration call:

Premium Education Programmes Schedule

Schedule for Fast-Track Programme on Futures & Options (F&O)Sr.No City Dates For More Information & Registration call:


1 Hyderabad 16th & 17th Apr 2016 Ruchi on 8297362323

2 New Delhi 16th & 17th Apr 2016 Harneet on 09582158693

3 Pune 23rd & 24th Apr 2016 Kusmakar on 7875442311

4 Kolkata 16th & 17th Apr 2016 Sumit Sarkar on 8017516187

5 Mumbai 23rd & 24th Apr 2016 Harsheel on 9167684228

6 Thane 30th Apr & 1st May 2016 Manish on 8451057943

7 Ahmedabad 17th Apr 2016 Yogesh on 8238053563

8 Vadodara 17th Apr 2016 Yogesh on 8238053563

Sr.No


Schedule for Technical Analysis Programme

9 New Delhi 9th & 10th Apr 2016 Harneet on 09582158693

10 Bangalore 16th & 17th Apr 2016 Subrata on 9620001478

11 Kolkata 23rd & 24th Apr 2016 Sumit Sarkar on 8017516187

12 Mumbai 16th & 17th Apr 2016 Harsheel on 9167684228

13 Thane 16th & 17th Apr 2016 Manish on 8451057943

Sr.No


Schedule for Foundation Programme on Stock Investing

14 Pune 9th & 10th Apr 2016 Kusmakar on 7875442311

15 New Delhi 23rd & 24th Apr 2016 Harneet on 09582158693

16 Pune 30th Apr & 1st May 2016 Kusmakar on 7875442311

17 Kolkata 16th & 17th May 2016 Sumit Sarkar on 8017516187

18 Mumbai 9th & 10th Apr 2016 Harsheel on 9167684228

19 Thane 9th & 10th Apr 2016 Manish on 8451057943

20 Mumbai 23rd & 24th Apr 2016 Manish on 8451057943

21 Nagpur 16th & 17th May 2016 Kusmakar on 7875442311

Sr.No City Dates For More Information & Registration call:

Schedule for Fast-track Programme on Stock Investing

22 Bhubaneswar 24th Apr 2016 Sumit Sarkar on 8017516187

23 Ranchi 24th Apr 2016 Sumit Sarkar on 8017516187

24 Surat 17th Apr 2016 Yogesh on 8238053563

25 Coimbatore 23rd Apr 2016 Subrata on 9620001478

63

Contact us

Email:

Send us an email at [email protected] mention the name, date and venue of the programme you have

attended or wish to attend, for faster resolution of your queries.

SMS:

SMS EDU to 5676766 for more details



Schedule for Techno Derivatives Programme


Schedule for Advanced Derivatives Trading Strategies Programme

26 Pune 9th & 10th Apr 2016 Kusmakar on 7875442311

27 Chennai 16th & 17th Apr 2016 Rajat on 9962294867

28 Bangalore 9th & 10th Apr 2016 Subrata on 9620001478

29 Kolkata 23rd & 24th Apr 2016 Sumit Sarkar on 8017516187

30 Trichy 30th Apr 2016 Subrata on 9620001478


Schedule for Professional Trader & Investor Programme

31 Ahmedabad 8th to 12th Apr 2016 Yogesh on 8238053563

32 Hyderabad 22nd to 26th Apr 2016 Ruchi on 8297362323

33 Bangalore 29th Apr to 3rd May 2016 Subrata on 9620001478

34 New Delhi 22nd to 26th Apr 2016 Harneet on 09582158693

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Documents

MD & CEO - ICICI Directcontent.icicidirect.com/MoneyManagerMagazine/April_2016.pdf · This will bring down the returns. Lower interest rates are correlated to lower inflation