IC ICIC ICI I Prudential dential Value lue Fund d Series ries - - PowerPoint PPT Presentation

IC ICIC ICI I Prudential dential Value lue Fund d – Series ries 13

All data/information used in the preparation of this material is dated and may or may not be relevant any time after the issuance of this material. The AMC takes no responsibility of updating any data/information in this material from time to

• time. The recipient of this material is solely responsible for any action taken based on this material.

The The inf infor

• rma

mation ion con

• ntained

ained herein herein is is sole solely ly for

• r priva

rivate circ irculat ulation ion fo for rea reading/ ding/understanding nderstanding of

• f re

regis gistere ered Adv dviso isors/ rs/ Distr stribu ibutors

• rs and should
• uld not be

be circulat ulated to to inve vest stor

• rs/p

s/prosp

• spec

ective ive inve vestor stors.

NFO Period – 25th April 2017 to 9th May 2017 2017 Benchmar hmark k – S&P P BSE 500 Index x

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This Product is suitable for investors who are seeking*:  Long term wealth creation  A close ended equity fund that aims to provide capital appreciation by investing in a well diversified portfolio of stocks through fundamental analysis.

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them

Why Equities ties Now?

Fixed ed Income Ral ally is Genera erally lly Followe wed By Equity

Histor

• ry suggest

ggests aft fter er interes rest rate te cycle bott ttoms ms, , equity ty rall lly star tarts

End of rate cut cycle and Start of Equity rally End of rate cut cycle and Start of Equity rally

Source: Bloomberg, data as of March 31, 2017. Past performance may or may not be sustained in future; RBI: Reserve Bank of India.

4 6 8 10 12 14 16 18 5000 10000 15000 20000 25000 30000 35000 Repo Rate (%) S&P BSE Sensex Levels S&P BSE Sensex Repo Rate

The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Nominal nal IIP – On The Path h To Growth th

• 7
• 7%
• 2
• 2%

3% 3% 8% 8% 13% 13% 18% 18% 23% 23% 28% 28% 1999 1999 2001 2001 2003 2003 2005 2005 2007 2007 2009 2009 2011 2011 2013 2013 2015 2015 2017 2017 Nom Nomin inal IIP al IIP (Y (YoY

• Y%,

%, 3MMA) MMA)

Th The increas increase in in IIP IP sugge ggests ts th that th the negati egative impac impact of

• f

dem demonetis etisation ation is is fa fadin ding and that that remo remonetis etisation ation is is wel ell underw derway ay. There Therefore, fore, bu busines inesses es are are expec expected ted to to rec recover er goin going forw rwar ard.

Source: CEIC, Morgan Stanley Research, Data as on Jan 2017; MMA – Monthly Moving Averages; YoY – Year-on-Year; IIP - Index of industrial production

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GDP G P Growth wth – Th The Bo Botto tom of the he Cycl cle e is Behind us us

3.8% 4.8% 3.8% 7.9% 7.9% 9.3% 9.3% 9.8% 3.9% 8.5% 10.3% 6.6% 5.5% 6.5% 7.2% 7.9% 7.1% 3% 4% 5% 6% 7% 8% 9% 10% 11% Real GDP YoY Average GDP Growth is 5.5%

Source: CEIC, Morgan Stanley Research Data as on Mar 2017; GDP – Gross Domestic Product; FDI – Foreign Direct Investment

Over the e last st few years, s, India dia has s take ken n a host st of econo nomic mic reform rms s init itiat iative ive, , includin luding the he Goods s and Servic vices es Tax (GST) T) and d liber eralisa alisation ion of the he FDI regime, e, with h a view to improve ve business siness climat ate e and promote e growth. The GST is expec ected d to roll out from July ly 2017. . All these ese init itiat iative ives s combine ined d is expec ected ed to help p pick-up of GDP growth-rat ate.

4

Cu Curr rren ent t Op Oppor portunities tunities

> > Un

Unorganised ganised to Orga ganised nised

> Infrastructure Sector

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Unorgan rganised ised to to Organised anised Shift ft

GST

Introduction of GST will help create a level-playing field for UnOrganised sector and Organised sector.

Demonetisation

The demonetisation drive is expected to benefit Organised sectors.

This can shift consumers away from local manufactures

Benefit Organised Players

Opportuni tunity ty: : This may res esult ult in higher gher topline ne and bottom

• m line

ne growt

• wth for

brande ded compani anies. s.

Source: Edelweiss Securities; GST - Goods & Service Tax

Will Lower tax evasion, increase

• compliance. Facilitate

seamless movement

• f goods.

Consumers to use more cashless medium of transaction.

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

India: a: On The Cusp of Accele elerat rated Shift ift to to Or Organized ganized Segment ment

India's GDP: $2.0tn Formal economy: $1.0tn Listed companies (Organised Sector): $0.5 tn

Source: Edelweiss Securities; All $ represents United States Dollar

Contribution of

• rganised/listed

companies is currently 1/4th of the economy

This share has huge scope to increase as the

• verall economy moves

from informal to formal aided by various government reforms

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Opportunity ity Seen n as there e is a sh shift ift towards s Organ anised ised economy my

Secto tors s with th high share are of Unorga ganised sed Busi sines esses ses Share are of Unorga ganised Business nesses es in Secto tor  Food Services 90%  Apparel 80%  Plywood 70%  Sanitary ware 60%  Tiles 50%  Footwear 50%  Electric Goods 40% 0%  Pipes 40%  Small Appliances 40%  Paints 30%

Source: Company data, Credit Suisse estimates 8

The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Strat ategy gy of Orga ganis nised Player yers Strat ategy gy of UnOrganis nised Player yers Large Distribution Network Scattered Distribution Network and More Regional Bias

• Superior Quality
• Accounting of Taxes
• Thus, Optimally Priced
• Inferior Quality
• Under Reporting of Tax
• Thus, Sub-Optimally Priced

Branding – Familiarity & Trust Brand Push – Offer higher margins to distribution channel Economies of Scale Diseconomies of scale

GDP P Contri ribu butio ion GDP P Contri ribu butio ion

Source: National Commission for Enterprises in the UnOrganised Sector

Organised anised Vs. . Unorg rgan anised ised

Shift

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

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Cur urre rent nt Oppor portuni tunities ties

> Unorganised to Organised

> I > Infr frastructure astructure Se Sector ctor

The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Why Infrastruc structur ture e Sec ector?

• r?

Stab able e Governme rnment t & Poli licy Initia itiativ tives es Good

• ds and Services Tax

ax & Demonetis etisat ation ion High gher er Governme rnment t Revenue Increas rease e in tax ax revenue under r IDS S High gher er govern ernmen ment t expendi diture re on infra rastr tructu cture re proje

• ject

cts Lower er Curre rent t Accou

• unt

t Defic icit it & Infla lation ion Strong rong Macroe acroecon conomic

• mic Bas

ase

100 0 Smar art t Cities 10,00 000 Km of New Roads

UDAY Scheme For financ ancial ial reviv ival al

• f Power

r distr trib ibut utio ion n companie anies

Digita ital India ia

Sources : CLSA | UDAY: Ujwal DISCOM Assurance Yojana | IDS: Income Disclosure Scheme

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Infras astru tructur ture e Sec ector

POWER: WER: Government’s focus on lowering debts of power distribution companies and

infrastructure expansion in rural and urban areas.

MINE NERAL RALS S / MININ NING: Could grow in tandem with expected increase in demand for

power, operational efficiency, and attractive valuations.

TEL ELECOM ECOM: India’s demographic advantage, rapid growth in data consumption, and

government initiatives such as Digital India.

CONSTRUC STRUCTION ION & CONSTRUC STRUCTION ON PROJECT OJECTS: Government’s focus on

infrastructure expansion in rural and urban areas. They could also leverage on excess capacity.

TRANS NSPORT ORTATION ON: Could benefit from the implementation of Goods and Services Tax (GST),

• perational efficiency, and attractive valuations.

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Governme ernment nt Boost for Cement nt Consum sumption tion

100 Smar art t Citi ties s Funding: g: INR 48,0 ,000 00 crore 10,000 000 Km of New Roads ds Funding: g: INR 97,000 ,000 crore re Affordable dable Housi sing ng : 20 Mn Homes es by 2022

Source: Union Budget 2017-18;

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Transport nsportation ation Sector: r: Numb mbers rs Pave ve The Way

1,43 437 3,06 068 4,42 421 6,00 000 1,00 1,000 2,00 2,000 3,00 3,000 4,00 4,000 5,00 5,000 6,00 6,000 FY14 FY14 FY15 FY15 FY16 FY16 FY17 FY17E Leng ngth th (Km) m) Leng ngth th of Roads (Km) m) Ordere red By Nati tional nal Highw hway ay Autho thori rity ty of India a (NHAI) I)

Source: Citigroup Global Markets India Private Limited, Ministry of Road Transport and Highways, and Shipping. All figures are approximate. FY17E: estimated

86 86 122 122 214 214 208 208 196 196 180 180 534 534 100 100 200 200 300 300 400 400 500 500 600 600

FY10 FY10 FY11 FY11 FY12 FY12 FY13 FY13 FY14 FY14 FY15 FY15 FY16 FY16

• Rs. billion
• n

Budgetary tary Alloca cati tion

• n to NHAI

Sectors that contribute raw material and companies involved in the creation of roads can benefit from higher allocation in budget on road infrastructure creation.

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Power Sector: r: Power-Packe acked Potential ial

India vs. World

15558 558 12947 947 10218 218 7753 53 7367 67 7138 38 10346 346 5452 52 6602 02 5277 77 4410 10 2509 09 3475 75 2972 72 1010 10

20 2000 00 40 4000 00 60 6000 00 80 8000 00 10 1000 000 12 1200 000 14 1400 000 16 1600 000 Kilo watts ts per hour

Per Capit ita a Consump sumption tion in 2014-15 15

Opportuni tunity ty lies es here

Source: Central Electricity Authority; All figures are approximate; PriceWaterHouse Cooper; Kwh: Kilo watt hours. The figures are approximate. *these figures are estimated

Availabil labilit ity of power will incre rease ase and will aid demand d for white goods. Sectors rs that will benefit from incre rease ase in power demand: d: Consume mer r Durable bles Manufac ufactur urin ing Power r Compani nies

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Inves estme tment t Strategy tegy

• Flexica

icap Strate tegy gy

• Bottom-up

up approach ch

• Fund

d intend ends s to in invest vest in 25-30* 30* stocks ks given ven at particu cula lar r point in time.

• Secto

tor r Themes mes

– Unorganised to Organised – Infrastructure sector

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* The No. of Stocks provided is to explain the investment philosophy and the actual No. may go up and down depending on than prevailing market conditions at the time of investment. The fund may invest up to 30 stocks depending on the discretion of the Fund

• Managers. The stock selection and investment strategy will be as per the Scheme Information Document

The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.

Tenure : 1329 days NFO Period : 25th April 2017 to 9th May 2017 MICR cheques : Till end of business day on 9th May 2017 RTGS and transfer cheques : Till end of business day on 9th May 2017 Switches : Switches from equity schemes -9th May 2017; Till cut

• ff time (specified for switch outs in the source scheme)

9th May 2017 from other schemes Option to be launched : ICICI Prudential Value Fund - Series 13 - Dividend ICICI Prudential Value Fund - Series 13 Direct Plan - Dividend Entry / Exit Load : Nil Minimum Application Amount : Rs.5,000/- (plus in multiple of Re.10) Liquidity : To be listed Benchmark : S&P BSE 500 Index Fund Manager :

• S. Naren & George Joseph*

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Scheme eme Features res

The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors. * Mr. Ihab Dalwai for investment in ADR/GDR/ Foreign securities. $ Actual number of stocks may go up or down depending on market conditions at the time of investment. The asset allocation and investment strategy of the scheme is subject to the provisions of the SID.

Disclaimers and R Risk F Factors

Mutua ual Fund investme tment nts are subjec ject to to market ket risks ks, read all all scheme me related docume ument nts carefull lly.

• Disclaimer: All figures and data given in the document are dated unless stated otherwise. In the preparation of the material

contained in this document, the AMC has used information that is publicly available, including information developed in-

• house. Some of the material used in the document may have been obtained from members/persons other than the AMC

and/or its affiliates and which may have been made available to the AMC and/or to its affiliates. Information gathered and material used in this document is believed to be from reliable sources. The AMC however does not warrant the accuracy, reasonableness and / or completeness of any information. We have included statements / opinions / recommendations in this document, which contain words, or phrases such as “will”, “expect”, “should”, “believe” and similar expressions or variations of such expressions, that are “forward looking statements”. Actual results may differ materially from those suggested by the forward looking statements due to risk or uncertainties associated with our expectations with respect to, but not limited to, exposure to market risks, general economic and political conditions in India and other countries globally, which have an impact on our services and / or investments, the monetary and interest policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices etc.

• The AMC (including its affiliates), the Mutual Fund, the trust and any of its officers, directors, personnel and employees,

shall not liable for any loss, damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this material in any manner. The recipient alone shall be fully responsible/are liable for any decision taken on this material.

• The sector(s)/stock(s) mentioned in this presentation do not constitute any recommendation of the same and ICICI

Prudential Mutual Fund may or may not have any future position in these sector(s)/stock(s). Past performance may or may not be sustained in the future. The portfolio of the scheme is subject to changes within the provisions of the Scheme Information document of the scheme. Please refer to the SID for investment pattern, strategy and risk factors.

• Investors are advised to consult their own legal, tax and financial advisors to determine possible

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The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors.