Investment Opportunities

October 2017

For Internal Consumption only

Agenda
Sr. No. Particulars
1. Equity & Debt Outlook
2. Recommended Asset Allocation
3. Mutual Fund Recommendation
- Recommended Funds Performance
- Recommended Equity Mutual Funds
- Recommended Debt Mutual Funds
4. Value Picks
5. Portfolio Management Services
6. Structured Products
7. Insurance
8. Safety Net & Estate Planning
9. Taxation of the Recommended Products
For Internal Consumption only
2
Equity Outlook – Equity market cycle – bull cycle in the making
Most asset classed including real estate and commodities are cyclical in nature. Equity too as an asset class is a trending asset which goes through
bear and bull market cycles.

Some examples of the cyclicality are as follows:

Real Estate in the U.S. - From 2000 to 2006, the Case-Shiller national home price index which measures prices on home sales in U.S. went up on
almost 84% and the over the next 5 years, shrunk by a quarter. Since then it has once again started to rise with an improvement in economic
sentiment.

Crude Oil - Post the financial crisis, the availability of cheap money and the premise that the Chinese economy would continue to guzzle fuel in large
amounts resulted in oil reaching of high of USD 140, post which a correction resulted in prices dropping all the way to USD 30 before recovering to
current levels of USD 50.

Indian Equities - Infrastructure and Global Liquidity-driven bull cycle – From 2003 – 2008, Indian Equities witnessed the bull cycle as the
infrastructure sector boomed. The domestic infra story coupled with global liquidity led to India and most global markets scaling to new highs.
During this period, Equity markets delivered 50% p.a. returns.

The last few years’ return of the Indian Equity market have been facing a bearish phase:

Jan 2008 (previous historic high) to Sep 2017 – ~5% p.a.

Long Term average – 14% (1995 to 2017)

3
Equity Outlook – Equity market cycle – bull cycle in the making
There is a strong reason to believe that we are knocking on the doors of a bull cycle, having faced the brunt of the bear market for the last 8 - 9 years.

Macro Factors: Huge improvement in macro economic indicators like falling inflation and interest rates, shrinking fiscal & current a/c deficit as
mentioned below along with implementation of GST will lead to very conducive environment for a sustainable bull market cycle.

Year 2013 2017

GDP 4.5% 5.7% (Q1FY18)
Forex Reserves US 292 Bn US 400 Bn
Inflation 10% 3.4%
Interest Rate 7.5% 6%
Fiscal Deficit 4.9% 3.2%
Current Account Deficit 4.7% 0.7%

Corporate Earnings: Corporate earnings of Nifty 50 companies after ranging in single digit negative earnings growth zone over the last 2 years have
recently started showing signs of improvement; for FY 16 – 17, the Nifty basket reported an EPS growth of 9% for the full year vis-à-vis the same period
a year back as can be seen in the table below:

Year Nifty EPS (INR) Nifty EPS Growth

FY14 -15 387 -5%
FY15-16 377 -3%
FY16-17 410 9%
This trend is also visible in the Q1 FY17 - 18 earnings ,where the Nifty EPS shows a growth of 6% from the last year same quarter. We strongly believe
that we are on the cusp of a substantial earnings growth cycle and Bloomberg analysts have been estimating an earnings growth of around 11% -12%
p.a. for the period FY17 – 18 and around 17% -18% p.a. for FY 18-19 onwards.
4
Equity Outlook – Equity market cycle – bull cycle in the making
Valuation: On the basis of a 12% EPS growth in FY18 and 17% thereafter, the Nifty P/E for FY 17 - 18 earnings expectation of 460 is
currently at 21x which is above the historical average of about 17x. Considering 2 - 3 months from now, markets will start factoring
in earnings of FY18 - 19 which is expected to be at 537, the P/E is trading at 18x forward while the long term average is at 18x
making it close to the long term average. Thus, markets are reasonably valued and attractive for investments at current levels.

Liquidity: FIIs and DIIs are 2 key participants in equity markets. From an international perspective, no other large emerging
economy has better investment characteristics and political stability than India. FIIs have been net buyers so far in this calendar
year and have bought net INR 34,500Cr worth of Indian Equity during Jan – Sep ‘17. Domestic Liquidity has emerged strongly with
retail investors investing close to INR 5000 Cr, EPFO investing INR 1900 Cr and NPS investing INR 400 Cr on a monthly basis, thus
bringing in INR 7500 Cr of sticky long term money every month into the markets.

The ‘TINA’ Factor: Falling interest rates are making investments in Debt more and more unattractive; restriction on cash have
resulted in Gold losing its attractiveness and Real Estate is under tremendous pressure due to oversupply. This has led to huge
interest in Equity markets with domestic investors buying a record INR 18,000 Cr of Equity each month in Aug ’17 and Sep’ 17
resp., taking the average monthly purchase to INR 13,000 Cr per month in the last 6 months, INR 5000 Cr of which is sticky SIP
money. For the period Jan – Aug ’17, Domestic investors have invested ~INR 90,000 Cr in Equities.

5
Debt Outlook
The Month That Went By:

Yields across maturity spectrum hardened by about 10 basis points during Sep’17. Continued strong primary debt issuance, tightening of liquidity
situation and modest net buys by both banks and foreign portfolio investors coupled with upward trajectory of retail inflation contributed to this.
Concerns on fiscal slippage due to front-loading of central government spending and likely increase in state deficits to finance populist measures
such as farmers’ loan waiver also weighing on the market. Debt market yields have generally hardened after Nov’16 and peaked around May’17.
Softer inflation and the anticipation of rate cut by RBI (released in Aug’17) led to some softening thereafter although the trend has reversed more
recently.

Overall debt market is currently in a delicate balance with movement of yield in a narrow band over the last three months. The time spread between
call money rate and benchmark 10 year bond narrowed considerably around Jul’17 mainly due to softening of money market rates which did not get
transmitted to the debt market. In the near-term, we feel that most negatives are priced in. consequent, surprise if any is likely to lead to softening
of longer-term yield rates.

Recommendation for Debt :

Debt is an integral part of all client portfolios, and its objective is to bring in stable and predictable returns across market and interest rate cycles,
thus minimizing the overall portfolio volatility. Investors can participate in Debt by investing in either duration-based funds i.e. funds that aim to
benefit from interest rate cycle, or by investing in accrual based funds that aim to benefit from high coupon income.

While the monetary cycle turning neutral, further fall in yield is limited. Secondly, the credit environment is improving with the number of upgrades
increasing the number of downgrades as per various rating agencies.

Thirdly, with the economy expanding, credit requirement of corporates and their access to capital markets (i.e. Mutual Funds directly) has been
gradually increasing, providing enough investment opportunities in the accrual space.

We would thus recommend that one stick to accrual debt funds where the predictability of returns is better than that of duration funds.
6
Recommended Asset Allocation
Conservative Moderately Conservative
Risk Profile Equity Debt
Conservative 0% 100% 20%
Moderately Conservative 20% 80%
Balanced 50% 50% 100% 80%
Moderately Aggressive 60% 40%
Aggressive 80% 20%
Debt Equity Debt

Equity 0% Debt 100% Equity 20% Debt 80%

Balanced Moderately Aggressive Aggressive

40% 20%
50% 50%
60%
80%

Equity Debt Equity Debt Equity Debt

Equity 50% Debt 50% Equity 60% Debt 40% Equity 80% Debt 20%
For Internal Consumption only
7
Mutual Fund Recommendation

Through Mutual Funds

 Tax efficient, Ease of monitoring, Superior long term returns, professionally managed
 Diversified Large & Mid Cap Equity Mutual Funds.

For Internal Consumption only

 Recommended Mutual Fund Basket Performance
145.0 134.4
Returns (%) in Absolute Terms

ABSOLUTE
OUTPERFORMANCE
95.0 OF 64%
70.7
44.9
45.0 30.4 23.1 22.9
14.7 13.7
-5.0
1 Year 2 Years 3 Years 4 Years
AR Equity Recommendation Nifty

Our recommended fund basket has outperformed nifty by 6.1% p.a. over a 3 year period & 9.4% p.a. over a 4 year period..

Our recommended fund basket has delivered an absolute alpha of 64% over nifty in the last 4 years.

Due to the superior risk management of the fund managers , recommended basket has captured only 74% of the downside and
118% of the upside of Nifty, over a 4 year period.

Source – Morning Star

*Returns as on 29th September 2017 9
*Returns in absolute terms
10
 Recommended Equity Mutual Funds and Returns
Large Cap 1yr 2yr 3yr 5yr
Birla Sun Life Equity 17.50 19.54 17.14 21.48
ICICI Pru Top 100 15.29 17.34 10.53 16.03
Kotak Select Focus 18.69 16.96 16.52 20.51
Mirae Asset India Opp 21.28 17.39 15.13 20.13
Reliance Top 200 17.37 13.89 12.33 16.90
SBI Bluechip 11.57 13.64 13.27 18.32
Nifty 50 13.67 10.97 7.11 11.41
S&P BSE Sensex 12.26 9.37 5.51 10.77

Mid Cap 1yr 2yr 3yr 5yr

Canara Robeco Emerging Equities 23.63 20.16 21.11 28.27
Franklin India Prima 15.89 17.89 18.31 25.17
HDFC Mid-Cap Opportunities 17.00 19.18 18.56 24.48
Kotak Emerging Equity 17.96 19.36 20.48 24.50
Nifty Free float Midcap 100 17.48 18.09 16.62 18.22

Returns as on 29th September 2017 11

 Quartile Analysis – Recommended Equity Mutual Funds
Average
Quarterly Quarterly Quarterly Quarterly Downside Upside
Rolling Std Dev of Treynor
Equity Mutual Funds Returns Returns Returns Returns MRAR Capture Capture Quartile
Return 3 Alpha Ratio 3 Yr
LQ LQ-1 LQ-2 LQ-3 Ratio 3 Yr Ratio 3 Yr
Yrs

Large-Cap
Birla Sun Life Equity 14.82 4.53 14.13 -5.87 15.18 9.77 6.12 12.69 77.60 121.59 Q1
ICICI Pru Top 100 9.25 1.65 13.27 -2.51 8.03 5.11 4.85 7.76 90.44 108.61 Q2
Kotak Select Focus 13.97 5.24 14.95 -5.28 8.28 11.85 5.00 14.61 79.31 131.40 Q1
Mirae Asset India Opp 12.17 5.98 14.09 -4.12 7.55 10.09 4.01 12.77 78.73 123.01 Q1
Reliance Top 200 8.40 6.06 14.91 -5.69 8.24 7.06 5.12 9.32 90.73 119.34 Q2
Small/Mid-Cap
Canara Robeco Emerging Eq 18.58 7.27 21.44 -8.40 11.19 15.79 6.48 17.66 101.87 123.08 Q1
HDFC Mid-Cap Opp 17.52 3.90 17.10 -6.35 12.88 13.81 4.34 17.65 86.74 105.51 Q1
Kotak Emerging Equity 19.66 3.19 19.31 -6.35 8.90 17.67 5.49 21.96 78.27 113.71 Q1

As on 30th June 2017 Colour Quartile 1 Quartile 2 Quartile 3 Quartile 4

Category Rating Top 25% 25%-50% 50%-75% Bottom 25% Source: Morning Star 12
# Morningstar risk adjusted return (MRAR)
Recommended Debt Mutual Funds
Annualised CAGR AUM YTM EXP
Credit Avg
3 6 MOD Lock in period
Opportunities Fund 1 Month 1 Year 2 Years 3 Years (Crs) Maturity (%) (%)
Months Months
Birla SL Medium
3.41 6.65 9.84 8.38 9.35 10.06 11490 4.16 8.73 3.05 1.52 #Up to 12 months 1%
Term Fund
DSPBR Income Opp
4.06 7.42 7.92 7.85 9.21 9.71 7386 3.15 8.64 2.41 1.8 #Up to 12 months 1%
Fund
HDFC Corporate
3.16 6.98 7.85 7.98 9.53 9.97 13298 3.82 8.49 2.90 1.72 #Up to 18 months 0.5%
debt Opp
ICICI Pru Regular
4.25 7.24 8.11 8.08 8.56 9.22 8079 2.71 9.00 2.11 1.60 #Up to 12 months 1%
Savings
Kotak Income
3.67 6.80 7.25 7.42 9.13 9.37 4760 2.4 8.39 1.88 1.60 #Up to 12 months 1%
Opportunities
Reliance Regular
4.62 7.19 7.81 8.03 8.97 9.27 9700 2.62 8.89 2.03 1.7 #Up to 12 months 1%
Saving Debt
Reliance Corporate
2.98 7.19 8.34 8.46 9.67 10.20 7851 3.91 8.17 2.89 1.7 #Up to 12 months 1%
Bond Fund
Franklin India
6.41 9.18 9.61 9.80 8.89 9.54 3242 2.08 9.76 1.89 1.7 #Up to 24 months 1%
Income Opp
Franklin India
5.79 8.99 9.59 9.86 9.72 10.73 2827 2.7 9.95 2.46 1.77 #Up to 48 months 0.5%
Dynamic Accrual
#HDFC Corporate Debt Opp Fund Exit load 2% Up to 1 Y, 1% b/w 1 Y to 2 Y, 0.5% b/w 2y to 3 y
# Franklin India Income Opp Fund Exit load 3% Up to 1 Y, 2% b/w 1 Y to 1.5 Y, 1% b/w 1.5Y to 2Y
#Franklin India Dynamic Accrual Fund Exit load 3% Up to 1Y, 2% Up to 1Y to 2Y, 1% b/w 2Y to 3Y, 0.5% b/w 3Y to 4Y

Portfolio and returns as on 29th September 2017

13
Value Picks

For Internal Consumption only

Value Picks
Sr No. Script Name Entry Date Target Price Rationale

Established in 1966 and part of the TVS group , Sundram Fasteners limited (SFL) is today
the largest manufacturer and exporter of high tensile fasteners. The company
manufactures automotive components such as high tensile fasteners, radiator caps,
powder metal parts, pumps and engine components. It has a global manufacturing
presence that spans India, China, United Kingdom and Malaysia. SFL caters to auto
OEMs in the two-wheeler, four-wheeler, farm equipment and commercial vehicle
segments. It has an extensive clientele with major industry leaders like Ashok
Leyland, M&M, Tata Motors, Daimler, Siemens etc. Company is moving from low margin
fasteners business to high margin business. SFL is significantly adding capacity and has
incurred Rs. 200 crore capital expenditure in FY17. Management noted that most of the
Sundram Fasteners capacity investment were incurred to dovetail production plans to those of key
customers. India is becoming a hub for auto components manufacturing with major
Limited
1 04-Sep-17 535 global auto companies like Volkswagen, Suzuki, General Motors, Mercedes, etc. setting
(SUNDRMFAST) up base in India. The Indian Auto Components industry to reach a size of US $100 billion
by FY2020 backed by strong exports ranging between US$ 80- US$ 100 billion by 2026,
from the current US$ 11.2 billion. This indicates huge scope for the auto components
industry and SFL being one of the leading manufacturers of fasteners will be in a good
position to encash on this burgeoning opportunity. The company is a good bet to ride
on, given the upturn in domestic auto sales. At a CMP of Rs. 410, SFL is trading at a P/E
multiple of 21.6x its FY18E EPS and 18.5x its FY19E EPS, which is at a discount to the
peer average of 32x. Anticipating the future growth potential of the Auto component
industry and the positioning of SFL as a multi-product and multi-location company, we
feel that it has huge growth potential and thus we initiate “BUY” with target price of
Rs.535 per share.

For Internal Consumption only 15

Value Picks
Sr No. Script Name Entry Date Target Price Rationale

Aarti Industries Ltd.
2 21-Sep-17
(AIL)
Aarti Industries Ltd. (AIL) is one of the most competitive and a fully integrated Benzene derivatives
specialty chemicals company. AIL has been undergoing capacity expansion and setting up new greenfield
facility for Toulene based derivatives product. The company has already completed expansion of its
Chloro Benzene and PDA chain and its expected to improve utilisation in next few quarters. AIL has also
completed its Toulene project and is expected to start commercial operations in Q2-FY18. With these
1084 capacity expansion starting operations gradually in FY-18 onwards, AIL would be positioning itself in a
more margin accretive specialty chemicals segment targeting existing customer base. We expect AIL to
witness higher growth and subsequently improved margins in medium term. We re-iterate our coverage
on Aarti Industries Limited (AIL) with a BUY rating and a target price of Rs.1,084 per share.

BLS Internation
3 28-Sep-17
Services Limited (BLS)
BLS International Services Ltd., today has earned itself an impeccable reputation for setting benchmarks
in its domain of expertise. It is one of the world’s largest visa, passport and consular outsourcing services
provider for governments and their diplomatic missions worldwide. The company manages visa and
passport issuance related administrative and non-judgmental tasks for its client governments, which
enables their clients to focus on the important judgmental part of the visa issuance. BLS has rapidly
scaled up its operations across 58 nations and 29 client governments. In 2016, BLS expanded its business
operations to provide front-end and citizen services to State Governments in India to facilitate the
realization of the goal of transparent and accountable e-governance system. In June’17, BLS
International won the Citizen Services contract from the Embassy of Afghanistan worth USD 5mn for the
five Gulf countries. BLS would need to open Citizen Service Centres (CSC) across the five Gulf countries
310 including UAE, Kuwait, Oman, Bahrain and Qatar for the nationals of Afghanistan. Growth in the visa
business is expected to be led by strong realizations from Spain (led by higher VAS), contribution from
the Afghanistan passport contract from 2Q, and new contract wins. BLS has processed over 20 million
applications to date with an approximately 18 million applications estimated to be processed during the
year FY2017- 18E. In FY2017-18E, several foreign mission tenders are likely to be submitted and BLS is
prequalified to bid for these global tenders in the pipeline. Backed by the years of industry experience,
strong brand positioning, competitive advantage and the niche nature of the industry, BLS is well
equipped to capitalize on the potential of this magnitude. At CMP the stock is trading at 22x FY18E and
19.7x FY19E. We initiate our coverage on BLS International ltd. with “BUY” recommendation and target
price of `310 per share.

For Internal Consumption only 16

 Value Picks

Picks which have achieved their Target :

Sr. No Script Name Entry Date Target Price Profit

HBL Power Systems HBL Power Systems Ltd. (HBLPOWER) Book Profit, given at 44 is trading near to its TARGET OF
1 13-Jul-17 68
Ltd. 68. THOSE HOLDING can Book Profit at around 70 levels, a profit of 57%.

For Internal Consumption only 17

Performance Graph- Since Jan 2014 (As on 29th Sep 2017)
Current Nifty
Entry Target CMP/ EXIT Profit / Loss Nifty 500 Level on Diff (%) Nifty
Sr.No. Scrip's Name Entry Date Exit Date 500 level/
Price Price RATE (%) Entry Date 500 Level
Booked Rate
1 AKZO NOBEL INDIA 23-Jan-14 837 1061 1120 06-Jun-14 34 4904 6130 25
2 ATUL LTD 10-Feb-14 409 715 715 06-May-14 75 4693 5273 12
3 AARTI INDS 25-Feb-14 103 135 132 19-Mar-14 28 4794 5044 5
4 SUNDRAM FASTENER 07-Mar-14 51 76 76 21-Apr-14 48 5034 5347 6
5 HINDUSTAN MEDIA VENTURES 12-Mar-14 124 210 210 17-Nov-14 69 5029 6826 36
6 VA-TECH WABAG 25-Mar-14 703 878 871 14-May-14 24 5103 5584 9
7 BAYER CROPSCIENCE 01-Apr-14 1490 2464 2445 01-Sep-14 64 5233 6438 23
8 IGARASHI MOTORS 10-Apr-14 161 215 219 18-Aug-14 36 5328 6294 18
9 KIRLOSKAR OIL ENGINE 21-Apr-14 200 257 257 02-Jul-14 29 5347 6277 17
10 GIC HOUSING 13-May-14 121 150 151 20-May-14 25 5563 5791 4
11 PRAJ INDUSTRIES 28-May-14 68 90 88 05-Jun-15 30 5861 6701 14
12 UPL 30-Jun-14 330 480 478 07-Apr-15 45 6174 7144 16
13 APAR INDUSTRIES 02-Jul-14 255 558 558 29-Jun-16 119 6277 6907 10
14 LUPIN 31-Jul-14 1173 1460 1460 18-Nov-14 24 6194 6837 10
15 ARVIND LTD 21-Aug-14 254 365 365 06-Jan-16 44 6339 6608 4
16 REC Ltd 18-Sep-14 266 375 165 01-Jun-16 (38) 6560 6815 4
17 KALYANI STEEL 08-Oct-14 133.65 188 188 05-Jan-16 41 6317 6640 5
18 Navneet Education Limited 16-Oct-14 97 120 120 20-Feb-15 24 6225 7209 16
19 Navneet Education Limited 16-Oct-14 97 120 120 20-Feb-15 24 6225 7209 16
20 IGARASHI MOTORS 16-Oct-14 282 388 388 10-Mar-15 38 6225 7142 15
21 KALYANI STEEL 16-Oct-14 140 188 188 05-Jan-16 34 6225 6640 7
22 ARVIND LTD 16-Oct-14 281 365 365 06-Jan-16 30 6225 6608 6
23 APAR INDS 16-Oct-14 388 558 558 29-Jun-16 44 6225 6907 11
24 NRB BEARINGS 16-Oct-14 129 170 118 31-Aug-16 (9) 6225 7491 20
25 EROS INTERNATIONAL 17-Nov-14 320 425 425 05-Feb-15 33 6826 7077 4
26 HIMATSINGKA SEIDE LTD 01-Dec-14 88 120 120 14-Jul-15 36 6898 7020 2
27 VA-TECH WABAG* 17-Dec-14 707 936/725 725 27-Mar-17 3 6493 7886 21
28 ESSEL PROPACK 24-Dec-14 130 190 185 21-Apr-16 42 6651 6634 (0)
29 CARE RATING 12-Jan-15 1656 1630 1635 30-Mar-17 (1) 6815 7968 17 18
Performance Graph- Since Jan 2014 (As on 29th Sep 2017)
Current Nifty
Entry Target CMP/ Exit Profit / Loss Nifty 500 Level On Diff (%) Nifty 500
Sr.No. Scrips Name Entry Date Exit Date 500 Level/
Price Price Rate (%) Entry Date Level
Booked Rate
30 CARBORANDUM UNIVERSAL 03-Feb-15 180 223 222 10-May-16 23 7137 6617 (7)
31 JUST DIAL LTD 09-Feb-15 1480 1020 650 29-Jan-16 (56) 6922 6339 (8)
32 SNOWMAN LOGISTICS 27-Mar-15 76 116/90/79 48 22-Aug-17 (37) 6847 8499 24
33 NIIT TECH 01-Apr-15 349 448 448 14-Jul-15 28 7060 7020 (1)
34 ATUL LTD 21-Apr-15 1277 1529 1529 20-Aug-15 20 6908 7017 2
35 GATEWAY DISTRIPARKS 29-May-15 352 436 / 360 230 22-Aug-17 (35) 6960 8499 22
36 TAMILNADU NEWSPRINT 19-Jun-15 153 193 193 17-Jul-15 26 6785 7148 5
37 WELSPUN INDIA 26-Jun-15 63 102 102 23-Mar-16 62 6909 6424 (7)
38 ALSTOM T&D 10-Jul-15 589 709 356 17-May-16 (40) 6936 6630 (4)
39 DEWAN HOUSING FINANCE* 27-Jul-15 246.5 322 320 18-Oct-16 30 6955 7512 8
40 SCHNEIDER ELETRIC INFRA 10-Aug-15 212 279/190 130 31-May-16 (39) 7158 6804 (5)
41 SINTEX INDUSTRIES LTD 01-Sep-15 92 146 76 01-Aug-16 (17) 6522 7335 12
42 NIIT TECH 04-Sep-15 450 570 570 19-Oct-15 27 6421 6908 8
43 KOKUYO CAMLIN 07-Sep-15 99 135 / 115 116 10-Jul-17 17 6323 8550 35
44 RSWM 23-Sep-15 277 440 426 21-Jun-16 54 6554 6886 5
45 GARWARE WALL ROPES 05-Oct-15 351 450 438 12-Jul-16 25 6789 7192 6
46 RAMCO INDS 23-Oct-15 128 165 165 25-Aug-16 29 6913 7344 6
47 SHARDA CROPCHEM LTD 30-Oct-15 262 346 330 26-May-16 26 6785 6725 (1)
48 WELSPUN INDIA 05-Nov-15 71 102 102 23-Mar-16 44 6662 6424 (4)
49 SCHNEIDER ELETRIC INFRA 05-Nov-15 170 279 130 31-May-16 (24) 6662 6804 2
50 KOKUYO CAMLIN 05-Nov-15 108 135 / 115 116 10-Jul-17 7 6662 8550 28
51 VOLTAS INDIA 05-Nov-15 277 351 349 27-Jul-16 26 6662 7298 10
52 DEWAN HOUSING FINANCE 05-Nov-15 220 322 320 18-Oct-16 45 6662 7512 13
53 BHARAT ELECTRONIC LTD 05-Nov-15 1256 1633 1600 30-Jan-17 27 6662 7458 12
54 SNOWMAN LOGISTICS 05-Nov-15 88 116 / 98 48 22-Aug-17 (45) 6662 8499 28
55 SYNGENE INTERNATIONAL 02-Dec-15 362 468 468 25-Aug-16 29 6700 7344 10
56 NILKAMAL LTD 04-Jan-16 1268 1630 1630 12-Jan-16 29 6631 6405 (3)
57 JAGRAN PRAKASHAN 20-Jan-16 158 205 205 08-Sep-16 30 6116 7643 25
19
Performance Graph- Since Jan 2014 (As on 29th Sep 2017)
Current Nifty
Entry Target CMP/ EXIT Profit / Loss Nifty 500 Level on Diff (%) Nifty
Sr.No. Scrip's Name Entry Date Exit Date 500 level/
Price Price RATE (%) Entry Date 500 Level
Booked Rate
59 NILKAMAL LTD 02-Mar-16 1010 1305 1270 08-Apr-16 26 6137 6347 3
60 TAMILNADU NEWSPRINT 10-Mar-16 208 272 271 11-May-16 30 6243 6593 6
61 ALKEM LABS LTD 17-Mar-16 1350 1720 1720 16-Sep-16 27 6256 7487 20
62 ARVIND LTD 29-Mar-16 267 350 350 23-Sep-16 31 6323 7555 19
63 Bajaj Finserv Ltd 11-May-16 1873 2350 2350 29-Jun-16 25 6593 6907 5
64 Mahindra Holiday & Resorts 26-May-16 397 490 485 24-Aug-16 22 6725 7386 10
65 CCL Products (India) Ltd 08-Jun-16 240 340 339 27-Feb-17 41 6902 7720 12
66 Manappuram Finance Ltd 27-Jun-16 66 84 84 01-Aug-16 27 6804 7335 8
67 S H Kelkar & Company Ltd 26-Jul-16 242 309 303 22-Aug-16 25 7270 7364 1
68 Deepak Nitrite 30-Aug-16 101 145 145 11-Apr-17 44 7462 8082 8
69 Aarti Industries 03-Oct-16 645 817 813 26-Apr-17 26 7532 8250 10
70 NOCIL 24-Oct-16 75 98 98 03-Apr-17 31 7552 8040 6
71 RICO AUTO 24-Oct-16 65 90 85 06-Sep-17 31 7552 8725 16
72 MahanagarGas Limited 24-Oct-16 760 926 920 07-Feb-17 21 7552 7622 1
73 Manappuram Finance Ltd 30-Nov-16 77 108 104 09-Feb-17 35 7079 7653 8
74 VOLTAS INDIA 07-Dec-16 311 373 370 27-Feb-17 19 6971 7742 11
75 Bajaj Finserv Ltd 19-Dec-16 2733 3415 3415 02-Feb-17 25 6943 7549 9
76 Dewan Housing Finance ltd 11-Jan-17 265 374 370 31-Mar-17 40 7214 7980 11
77 Mahindra Holidays Ltd 23-Jan-17 409 535 530 08-Jun-17 30 7243 8422 16
78 Pidilite Industries Ltd 28-Feb-17 682 810 810 06-Jun-17 19 7709 8449 10
79 Deepak Nitrite 12-May-17 139 179 175 19-Jun-17 26 8331 8435 1
80 HBL Power Systems Ltd 13-Jul-17 44 68 70 20-Sep-17 59 8641 8960 4

20
 Value Picks – OPEN position as on 29th Sep 2017
CMP/ Current Nifty
Profit / Loss Nifty 500 Level on Diff (%) Nifty 500
Sr.No. Scrips Name Entry Date Entry Price Target Price EXIT Exit Date 500 level/
(%) Entry Date Level
RATE Booked Rate
1 RALLIS INDIA 22-Jul-14 215 325 208 OPEN (3) 6251 8600 38
2 RALLIS INDIA 16-Oct-14 244 325 208 OPEN (15) 6225 8600 38
3 TALWALKAR BETTER VALUE 10-Mar-15 331 446 271 OPEN (18) 7142 8600 20
4 BAJAJ CORP 06-May-15 442 573 398 OPEN (10) 6681 8600 29
5 ASHOK LEYLAND 05-Nov-15 92 130 123 OPEN 34 6662 8600 29
6 ASTRA MICROWAVE PRODUCTS 14-Dec-15 134 180 / 155 125 OPEN (6) 6458 8600 33
7 COX & KINGS 23-Dec-15 240 358 276 OPEN 15 6653 8600 29
8 TITAGARH WAGONS LTD 01-Feb-16 144 185 120 OPEN (17) 6342 8600 36
9 ECLERX SERVICES LTD 08-Mar-16 1320 1792 1248 OPEN (5) 6244 8600 38
10 Tata Elxsi Ltd 06-May-16 918 1254 813 OPEN (11) 6505 8600 32
11 Equitas Holding Ltd 08-Jul-16 185 265 152 OPEN (18) 7039 8600 22
12 Hindustan Media Ventures Ltd 24-Aug-16 270 400 251 OPEN (7) 7386 8600 16
13 Globus Spirits 26-Sep-16 88 165 79 OPEN (11) 7479 8600 15
14 S H Kelkar & Company Ltd 24-Oct-16 303 382 252 OPEN (17) 7552 8600 14
15 Equitas Holding Ltd 24-Oct-16 182 265 152 OPEN (16) 7552 8600 14
16 Globus Spirits 24-Oct-16 106 165 79 OPEN (26) 7552 8600 14
17 Byke Hospitality 22-Nov-16 171 268 173 OPEN 1 6835 8600 26
18 Syngene International Ltd 14-Feb-17 485 717 496 OPEN 2 7605 8600 13
19 Precision Camshafts Ltd 21-Mar-17 142 189 109 OPEN (23) 7909 8600 9
20 UPL 27-Mar-17 726 1095 779 OPEN 7 7865 8600 9

For Internal Consumption only 21

 Value Picks – OPEN position as on 29th Sep 2017
Current Nifty
Entry CMP/ EXIT Profit / Loss Nifty 500 Level on Diff (%) Nifty 500
Sr.No. Scrips Name Entry Date Target Price Exit Date 500 level/
Price RATE (%) Entry Date Level
Booked Rate

21 Bharat Forge Ltd 20-Apr-17 541 750 589 OPEN 9 8063 8600 7
22 Supreme Industries Ltd 25-Apr-17 1069 1450 1099 OPEN 3 8217 8600 5
23 Finolex Cables 26-May-17 498 640 542 OPEN 9 8234 8600 4
24 Garware Wall Rope 14-Jun-17 814 1025 880 OPEN 8 8421 8600 2
25 Advanced Enzymes 22-Jun-17 333 415 252 OPEN (24) 8444 8600 2
26 KALYANI STEEL 27-Jul-17 439 605 389 OPEN (11) 8737 8600 (2)
27 Tejas Networks Ltd 23-Aug-17 325 418 297 OPEN (9) 8585 8600 0
28 Sundram Fastners 04-Sep-17 408 535 440 OPEN 8 8700 8600 (1)
29 Aarti Inds 21-Sep-17 871 1084 893 OPEN 3 8911 8600 (3)
30 BLS Int Services Ltd 28-Sep-17 245 310 247 OPEN 1 8557 8600 1

For Internal Consumption only 22

Portfolio Management Services

Through Stock portfolio:

Companies with strong fundamentals, beneficiaries of sector specific growth.

 AnandRathi Equity advisory recommended basket and PMS.

For Internal Consumption only

 Anand Rathi PMS - IMPRESS Portfolio
Objective
Focus on Return Optimization by investing in multicap portfolio of
rising enterprises with sound corporate track record and sustainable
business model keeping balance between value and growth strategy.

Market Cap Allocation Avg Market Cap (cr)

Cash, 1%
Small Cap, Large Cap, Focus on Quality Midcap Large Cap 117412
24% 29%
and Small Cap. Midcap 8118
No stock less then Small Cap 3004
Mid Cap,
46% 1000 cr Market Cap Overall Portfolio 38287

Sector Allocation
0.0% 5.0% 10.0% 15.0% 20.0%
10%
Value Absolute Performance as on 29th SEP 2017
Max 20 stocks portfolio Auto & Ancillary
35% 8% IMPRESS Portfolio NIFTY 500
Growth well balanced between the Financials

65% value and growth style of Chemicals

6%
investment Hospitality
4.2%
Metal Product 4% 3.3% 3.2% 3.25%
Plastic Product
High Capital Goods 2%
Technology 0.2%
IMPRESS
0%
Portfolio
Portfolio Positioning Agri Chemical

Medium to High Textiles -1.1%

Reward

-2% -1.58%
Risk & Reward Infrastructure -2.2%
Oil & Gas -4%
Consumer… 1 Month 2 Month 3 Month Since Inception
Power (31st May 2017)

Low Risk High

Data as on 29 SEP 2017 For Internal Consumption only 24
 Anand Rathi PMS - Portfolio Plus
Objective Investment Philosophy
The key objective is to deliver consistent return over the long
term, from a portfolio of companies selected on basis of well Business Model
defined objectives and good corporate track record. 1) Strong Business Model
2) ROE > 20% (Most Cases) Approach
Portfolio Positioning 1) Long Term Approach
Medium Market Cap Allocation Consistency 2) Low Churn – Low Expense
High
Risk & Reward Cash, 1% 1) Sales / EBIDTA / PAT growth (3-5 years)
2) Stable or improving margins (3-5 years) Diversification
1) Sectorally well diversified max 20 stocks
Portfolio Mid Cap, Focus on 2) 50:50 Large cap and Midcap companies
Plus
Reward

42% Large Cap, 1) Asset Light Models (Most Cases)

57% 2) Domestic Play (Most Cases) Exposure
1) Single Stock exposure < 10%
Visibility 2) Single Sector exposure < 30%
1) Earnings outlook over next 3 years
2) Predictable business model
Low Risk High

No. Top 10 Holdings % Sector % Allocation "Portfolio Plus" Returns as on 29th Sep 2017
Financials 20.6% Annualised Inception 18th
1 Finolex Cables Ltd 7.0% Consumer Durables 7.0% 1 Month 6 Month 1 Year 3 Years 5 Years Oct 11
2 Indraprastha Gas Ltd 6.8% Oil & Gas 11.2%
3 Kansai Nerolac Paints Limited 6.2% Infrastructure 5.4% PMS Portfolio Plus 1.2% 7.5% 15.8% 10.3% 15.1% 16.4%
Agri Chemical 8.9%
4 Syngene International Limited 6.0% Logistics 5.4% Blended Index* -1.1% 6.0% 16.9% 12.1% 15.0% 14.6%
5 Capital First Limited 6.0% Capital Goods 5.4%
Auto & Ancillary 9.2% NIFTY 50 -1.3% 6.7% 13.9% 7.1% 11.4% 11.8%
6 Larsen & Toubro Ltd 5.4%
Plastic Product 4.0% NIFTY MIDCAP 100 -0.9% 5.3% 19.9% 16.6% 18.2% 17.2%
7 ABB India Limited 5.4% Cement 4.4%
8 Container Corporation Of India Ltd 5.4% Paints 6.2% Note : Performance since inception is net of all expenses of the initial client (profit sharing model)
9 Sundram Fasteners Limited 5.1% Pharma 6.0% * Blended Index is taken as average of NIFTY 50 and NIFTY MIDCAP 100 Index
10 Axis Bank Ltd 5.1% Chemicals 5.0%
Cash 1.1% Data as on 29 SEP 2017
Total 100.0%
For Internal Consumption only 25
KOTAK SPECIAL SITUATION VALUE STRATEGY

For Internal Consumption only 26

ICICI Pru FLEXI CAP PORTFOLIO

For Internal Consumption only 27

Structured Products

Through Nifty Linked Debentures – Structured Products

Superior risk adjusted returns

 Protection of returns in range bound markets (0% to 15%)

For Internal Consumption only

What are Structure Products?

 What are Structure Products?

1) These are debt instruments in the form of NCD mostly issued by NBFC’s
2) Unlike Plain vanilla NCD which offers fixed Coupon every year, these NCD offers conditional coupon paid
lump sum on maturity.
3) Conditional Coupon is based on the underlying asset performance which is linked to these NCD
4) Most of the NCD are linked to NIFTY Index
5) These are also called as Nifty Linked Debentures, Market Linked Debentures or in Generic Structured
Products
6) The strength of a structured product lies in its flexibility and tailored approach to investing
7) Risk and Reward matrix of traditional form of investment in Debt as well as Equity can be change with the
help of Structured Product.
8) Credit Risk is there as in case of all debt related investments

29
For Internal Consumption only
Classification’s of Structure Products

 Debt Oriented Structure:

1) Focus is more on the safety of principal and yield Improvement
2) A calculated risk with a small expectation on underlying asset movement, per annum yield can be stretched to 12% to
14%
3) Diversifying the Debt Portfolio and investing in to Debt Oriented Structure can improve the overall yield on Debt Assets
by approx. 2% p.a.

 Equity Oriented Structure

1) Focus is more to achieve the objective of putting money into Equity market i.e. 15% to 18% return p.a. (63% to 78% over
3 ½ years).
2) When markets perform well, mostly all investments related to Markets do well, However when markets don’t live upto
our expectation in the long run (3 ½ years) do we have Plan B.
3) The products offered have a potential to deliver the expected return from equity market even if market performs
marginally upside.
4) Equity oriented products offer higher probability to meet the objective compare to other forms of equity investment
keeping the risk more or less is similar
5) Diversification of your Equity Portfolio by investing into Equity Oriented structures helps like a hedge when market don’t
perform up to your expectations.

30
For Internal Consumption only
Benefits & Risks
Benefits to Investors Risks to Investors
 Predefined Pay Offs  Systematic Risk/Market Risk: The value of the investment

 Probability Maximizer changes with movement in interest rates and volatilities.

 Plan B to your Portfolio  Credit Risk / Default Risk: Probability of issuer/ Guarantor
defaulting.
 Mechanical Strategy less human intervention
 Liqidity Risk: These instruments are not frequently traded on
 Diversification
exchange. Investor may not able to sell or redeem them
before maturity.

 Contingent Return: Returns are subject to underlying value

which makes it uncertain to determine before hand unlike
Bonds.

 Risk of Early Termination: In the events of Force Majeure,

Illegality or any other extra-ordinary reason – Investor may
not receive expected return.

 Pricing Transparency and Instrument Valuation risk to

investor in case of early redemption as there is no straight
formula to calculate
31
For Internal Consumption only
Structure Product - Description

For Internal Consumption only

 Protected Call (47% Coupon @ 106%) – Salient Features

• Debt like
Asset • Targeting Nifty 2% p.a
• Principal Protected till -12.8%

• Coupon  46% to 47%

Returns • IRR  12.90%
• Decay  2.5X throughout

• Maximum Returns  93.05%

Back Testing • Positive Returns  99.92%

*Historical probability is calculated considering 1182 Day rolling Nifty returns as on 31-Mar-17
Nifty Data from April 2004 to April 2014

For Internal Consumption only

33
Protected Call (47% Coupon @ 106%) – Salient Features
Key Terms & Specifications Payoff Table Pre Tax IRR * 12.90%
Underlying Nifty Final Fixing Nifty Product
Capital Guarantee Principal is not Protected Levels ^ Performance Returns
Tenor (days) 1,160 15680 60.00% 47.00%
Initial Fixing Level Trade Date Nifty Level, rounded up to next 100 14406 47.00% 47.00%
Final Fixing Level November 26, 2020 11760 20.00% 47.00%
Nifty Performance (NP) (Final Fixing Level/Initial Fixing Level) – 1 10388 6.00% 47.00%
Contingent Coupon (CC) 46.00% - 47.00% 10290 5.00% 44.50%
Decay Multiple (DM) 2.50 9898 1.00% 34.50%
If Final Fixing Level is at or above 9800 0.00% 32.00%
Contingent Coupon (47%)
106% of Initial Fixing Level
9604 -2.00% 27.00%
Payoff MAX(-100%,CC+(NP-
If Final Fixing Level is below 9310 -5.00% 19.50%
6%)*2.5)
106% of Initial Fixing Level 9016 -8.00% 12.00%
8820 -10.00% 7.00%
Payoff Chart
8546 -12.80% 0.00%
8428 -14.00% -3.00%
8232 -16.00% -8.00%
8036 -18.00% -13.00%
7644 -22.00% -23.00%
6860 -30.00% -43.00%
* Pre-Tax IRR is calculated assuming coupon to be 47%,.
^ Initial Fixing Level is assumed as 9788, rounded off to 9800

Notes: Terms and specifications of the product are subject to change.

Debentures are not principal protected, not listed and not rated in nature
Fee Structure: Upfront 1% to 3.0% plus service taxes

Issuer - ARGFL 30
For Internal Consumption only
 Protected Call (47% Coupon @ 106%) – Salient Features
Historical 1182 Day Rolling Returns - Back Testing*

Particulars Total
No. of Observations (Total Observations : 5077) 5,022
No of times product has delivered 47% returns 4,673
% of observations product has delivered 47% returns 93.05%
No of times product has delivered positive returns 5,018
% of observations product has delivered positive returns 99.92%

^Source: NSE 31
35
For Internal Consumption only
Nifty Accelerator 65% – Salient Features

• Equity
Asset • Targeting Nifty ~5% p.a.

• Coupon  62%-64%
• IRR  16.8%
Returns • PR1 ( from 0% to 16%)  150%
• PR2 ( from 14% to 16%)  1333%

• Maximum Returns  80.49%

Back Testing • Positive Returns  99.42%

*Historical probability is calculated considering 1182Day rolling Nifty returns as on 31-Mar-17

Nifty Data from June 2000 to April 2014

For Internal Consumption only

36
 Nifty Accelerator 65% – Payoff Scenario
Key Terms & Specifications Payoff Table Pre Tax IRR * 17%
Underlying Nifty
Final Fixing Nifty Product
Capital Guarantee Principal is not Protected
Levels ^ Performance Returns
Tenor (days) 1,160
16236 64.00% 64.00%
100 Points above the trade date Nifty, rounded up to next
Initial Fixing Level 13860 40.00% 64.00%
100
Final Fixing Level November 26, 2020 11484 16.00% 64.00%
Nifty Performance (NP) (Final Fixing Level/Initial Fixing Level) – 1 11385 15.00% 49.17%
Contingent Coupon (CC) 62.00% - 64.00% 11286 14.00% 34.33%
Participation Rate 1(PR1) 150% 11187 13.00% 19.50%
10989 11.00% 16.50%
Participation Rate 2(PR2) 1267% - 1333%(From 113% of Initial Nifty)
10791 9.00% 13.50%
Decay Multiple (DM) 1.65
If Final Fixing Level is at or Min(65%,(NP*PR1+Max(0%,(NP 10593 7.00% 10.50%
above Initial Fixing Level -13%)*PR2))) 10395 5.00% 7.50%
Payoff 10197 3.00% 4.50%
If Final Fixing Level is below Max(-
Initial Fixing Level 100%,Min(0%,(NP+10%)*DM)) 9999 1.00% 1.50%
9900 0.00% 0.00%
Payoff Chart 9702 -2.00% 0.00%
9405 -5.00% 0.00%
8910 -10.00% 0.00%
8811 -11.00% -1.65%
8712 -12.00% -3.30%

* Pre-Tax IRR is calculated assuming coupon to be 65%,.

^ Initial Fixing Level is assumed as 9788 rounded off to 9800 +100 = 9900

Notes: Terms and specifications of the product are subject to change.

Debentures are not principal protected, not listed and not rated in nature
Fee Structure: Upfront 1% to 3.0% plus service taxes

For Internal Consumption only Issuer - ARGFL 37

 Nifty Accelerator 65% – Investment Rationale
Historical 1182 Day Rolling Returns - Back Testing

Particulars Total
No. of Observations (Total Observations : 5,077) 5,022
No of times product has delivered 65% returns 4,042
% of observations product has delivered 65% returns 80.59%
No of times product has delivered positive returns 4,993
% of observations product has delivered positive returns 99.42%

^Source: NSE For Internal Consumption only 38

Insurance

For Internal Consumption only

Insurance Audit – The Need of Today
The primary objective of life insurance is to compensate the dependant family for loss of future income in case of unfortunate
death of the breadwinner of that family. Some policies also provide a return on investment if the insured survives the policy term
or chooses to withdraw mid-way. Current tax laws provide tax benefit at both these stages, that is, on investments and on returns
generated, if any.

Usually, in Indian market, insurance and investment objectives are combined. However, in most of the cases where insurance/
protection objectives are mixed with investment objectives, it has resulted in substandard returns which has created dissatisfaction
among most investors.

We strongly recommend not to mix the two objectives – protection and investment. Mixing them could be disastrous for HNIs.

We have developed a simple auditing process, based on the most relevant parameters of insurance products. This process can help
one evaluate the existing insurance policies held /bought over a period of time by HNIs.

Three core reasons for performing an Insurance Audit

• Dynamics of life stages: Life insurance may be required in the initial stages of working life when we start building our incomes,
investments and net worth. Initially, the purpose of life insurance could be to safeguard dependants in case of any eventuality.
However, over a period of time when sufficient net worth is generated, life insurance may not be required.

40
Insurance Audit – The Need of Today
• Regulatory Changes: A lot of regulatory changes have happened in life insurance industry over a past few years. In addition to
these changes, attractive plans have also come up in the market may be with lower cost. For example, Life cover of one crore
sum assured for male aged 35 and plan term 30 years costing around Rs 25000 to 30000 upto 2010 is available today for 13000
to 15000 – almost 50% lower.
• The Objective that the plan was expected to achieve: Many a times these plans have been purchased only to save taxes or
because of obligation to a relative or miss sold by an advisor who may not have been seen after purchasing the plan. The very
reason for having purchased the plan needs to be examined.

What is an Insurance Audit expected to do?

Insurance Audit is expected to:
• Look at the relevance of cost of life cover provided by the plans held and recommend whether to continue/discontinue/exit
and replace the life cover at lower cost.
• Look at the IRR (returns) of plans held as on today and help understand the expected IRR (returns) and decide whether to
continue/ discontinue/ exit; or identify if other investment avenues are better.

41
Safety Net & Estate Planning

 Creating safety is as critical as creating wealth

For Internal Consumption only

 Avenues to safeguard Wealth

Provident Fund Married Women Property Act Private Family Trust

(MWP), 1874

RING-FENCING   *

NO CAP ON INVESTMENT LIMIT   

PLAN YOUR IRR   

Do you think a Private Family Trust serves a greater purpose than the other avenues?

* Provided there is no nexus proven between the creation of the Trust and any liability arising on the concerned individual and the Trust is in existence for a considerable span of time
43
Constituents of a Private Family Trust

SETTLOR Creator of Trust

Contribute to Trust Corpus

Manage money and affairs of the
Trust

Money is managed including

1. MANAGING TRUSTEE Private Trust distribution at Trustee’s
2. 2nd TRUSTEE Discretion

Wealth is
Contribute to Trust Corpus Preserved

Wealth used for the

BENEFICIARIES
Beneficiaries

For Internal Consumption only 44

WILL- For Assets outside the Trust

We must aim to achieve “near-zero-transmission-loss" in the Succession of your Wealth

• Define your Desired manner of distribution of wealth

• List out immovable properties – identify specific beneficiary to each

• For liquid assets, define a percentage to each Legatee (beneficiary)

• Executor – you may appoint an Executor to deal with the succession of properties and/or if children are overseas

• Your spouse or child could be the Executor & if not, it can be a close friend /CA/Lawyer

• Management of money

– You may need to familiarize your spouse to manage the investments in case of an eventuality

– Therefore she should be involved in every stage of design and execution of Strategy

– She should be present in all the Wealth Management meetings

For Internal Consumption only 45

Taxation

 Tax applicable on the Recommended Product basket.

For Internal Consumption only

Taxation on Equity & Debt
Capital Gains Taxation
Particulars Individual/HUF Non-Resident Indians (NRI)
Equity Oriented Mutual Funds, Stocks, Portfolio Management Services(PMS)
Long term Capital Gain (Holding period >12 mts) Nil Nil
Short term Capital Gain (Holding period <12 mts) 15% on the gains 15% on the gains

Debt Funds, Gold Funds & other non-equity assets

Listed Instruments - 20% with indexation

Long term Capital Gain (Holding period >36 mts) 20% with Indexation
Unlisted Instruments - 10% without indexation
Short term Capital Gain (Holding period <36 mts) As per Income Tax slab rate As per Income Tax slab rate

Notes -
- For NRI individuals tax is deducted at sources as per the mentioned rates.
- In case the income exceeds Rs.1 cr than investors have to pay Surcharge @12%
- Education cess will continue to apply on tax applicable.

Tax on Dividend received by Investor

Particulars Individual/HUF Non-Resident Indians (NRI)
Dividend Received by Investor
Equity Oriented Schemes Nil Nil
Debt Oriented Schemes Nil Nil
Tax Applicable to Companies on Distributed Income

Equity Oriented Schemes Nil Nil

Debt Oriented Schemes 25% + 12% Surcharge + 3% Cess 25% + 12% Surcharge + 3% Cess = 28.84%
Infrastructure Debt Funds = 28.84% 5% + 12% Surcharge + 3% Cess = 5.768%

Note - Securities Transaction Tax (STT) is charged @0.001% on transaction of Equity oriented Mutual Funds.
For Internal Consumption only 47
Taxation on Structure Products
I. If Structured Product to be Held till Maturity:

o Unlisted - On Maturity of NCD, NBFC will give back principal plus interest, where TDS of 10% if PAN mentioned in DP, else 20% if PAN
No not specified in DP applicable would be deducted on Interest.
o Listed - On Maturity of NCD, NBFC will give back principal plus interest, where TDS of 10% would be deducted on Interest.

II. If Structured Product exited before Maturity: (2 scenarios)

Selling it to third party, here again two scenarios:

i. Unlisted –
i. Selling before 36 months, it is short term capital Gain, taxed as per tax slab rate
ii. Selling after 36 months, it is Long term Capital Gain where taxed @ 20% without indexation benefit

ii. Listed –
i. Selling before 12 months, it is short term capital Gain, taxed as per tax slab rate
ii. Selling after 12 months, it is Long term Capital Gain where taxed @ 10% without indexation benefit

For Internal Consumption only 48

 Thank you
Disclaimer:-This report has been issued by Anand Rathi Financial Services Limited (ARFSL), which is regulated by SEBI. The information herein was obtained from various sources; we do not guarantee its accuracy or completeness. Neither the information nor any opinion
expressed constitutes an offer, or an invitation to make an offer, to buy or sell any securities or any options, futures or other derivatives related to such securities ("related investments"). ARFSL and its affiliates may trade for their own accounts as market maker / jobber
and/or arbitrageur in any securities of this issuer(s) or in related investments, and may be on the opposite side of public orders. ARFSL, its affiliates, directors, officers, and employees may have a long or short position in any securities of this issuer(s) or in related
investments. ARFSL or its affiliates may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any entity mentioned in this report. This research report is prepared for private circulation. It does not have
regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed
or recommended in this report and should understand that statements regarding future prospects may not be realized. Investors should note that income from such securities, if any, may fluctuate and that each security's price or value may rise or fall. Past performance is
not necessarily a guide to future performance. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in this report. Please read the following DISCLAIMER carefully:
http://www.rathi.com/Static/disclaimer2.aspx

In case of any query or suggestions please email us at pcgadvisory@rathi.com

Anand Rathi Preferred Advisory Desk
For Internal Consumption only