IIFL Monthly

Investment Strategy
Report

January 2020
 Table of Contents Page No.
I Market Update & Outlook 4
A 2020 – A Challenging Year for the Indian Economy 5
B Market Update 6
C Equity Outlook 7
D Fixed Income Outlook 8
E Importance of Asset Allocation 9
F Outlook - 2020 10
G Wish List of Reforms 11
H Model Portfolio & Returns – Direct Equity 12-13
II Mutual Fund Recommendations 14
A Equity Mutual Funds 15-21
B Debt Mutual Funds 22-28
C Mutual Fund Risk Profile 29-30
D Model Portfolio & Returns – Mutual Funds 31-33

2
 Table of Contents Page No.
III Non-MF Product Recommendations 34
A PMS 35-38
B AIF 39-40
C Purnartha Equity Advisory 41
D Unlisted Shares 42
E Bonds 43-44
F MLD 45-47
Disclaimer 48

3
IIFL Monthly
Market Update &
Outlook

4
2020 – A Challenging Year for the Indian Economy
Combined fiscal deficit has been creeping up over the last few years GST collections growth has been sluggish partly due to weak economic
growth

Compensation pay-out in FY20 has been significantly higher than Recent spike in food inflation is driving the acceleration in food
collections inflation

5
Market Update
 In December 2019, global equity markets maintained upward Index 31-Dec-19 1 M (%) 1 YR (%)
momentum as the US and China confirmed signing a preliminary NIFTY 50 12,168 0.9 12.0
deal in January 2020. Moreover, dovish monetary policy stance S&P BSE SENSEX 41,254 1.1 14.4
by the large central banks added fuel to investors’ optimism. S&P BSE Mid-Cap 14,968 (0.8) (3.0)
 India’s frontline benchmark indices remained buoyant ahead of S&P BSE Small-Cap 13,699 1.0 (6.8)
Q3 earnings mainly on the back of global rally and expectations Dow Jones 28,538 1.7 22.3
of more measures by the Govt. to stimulate economic growth. Nasdaq-100 8,733 3.9 38.0
S&P 500 3,231 2.9 28.9
 NIFTY 50 rose 0.9%, while BSE Sensex went up 1.1% on MoM
basis in December 2019. However, broader markets witnessed Hang Seng 28,190 7.0 9.1
profit booking amid continued concerns on domestic slowdown. Nikkei 225 23,657 1.6 18.2

 In December 2019, FIIs invested ₹7,406cr (vs. ₹22,490cr invested Net Inflows in Equity (`cr.)
MoM) in Indian equities, while DIIs bought ₹1,960cr worth of 22,490
equities (vs. ₹5,361cr sold MoM) during the month.
14,657
 Going ahead, Indian markets are likely to remain buoyant
backed by global liquidity. Moreover, despite rich valuations, 7,406
3,272 1,960
benchmark indices are likely to gain momentum on
expectations that the Govt. may announce hefty measures to
boost consumption and encourage private investments in -5,361
Budget 2020. DIIs FIIs
Note: Returns and Inflows data as on December 31, 2019 Oct-19 Nov-19 Dec-19
Source: ACE MF, IIFL Research

6
 Equity Outlook
 NIFTY is trading at ~1.7x standard deviation above long
term average and hit all time high during December.
 Currently Indian markets are trading at expensive
valuations relative to its emerging market peers.
 Higher levels of benchmark indices were largely driven by
rising interest of foreign investors for Indian equities.
Further, substantial progress on bankruptcy resolutions,
return of pricing power in telecom sector and Govt.’s
efforts to address liquidity issues of Real Estate and
Infrastructure sector aided investors’ sentiments.
 Currently, NIFTY 50 index is trading at higher levels
despite challenging macroeconomic scenario. However,
impending earnings recovery is likely to justify valuations
in the medium term. Considering the valuation gap
between large caps and mid/small caps, we recommend
equity investors to invest in mid and small cap stocks as
broader markets are likely to outperform on hopes of
growth revival. Investors with lower risk appetite can
continue to invest in equities through mutual funds via.
SIP route.
Note: NA
Source: ACE Equity, IIFL Research, NIFTY Forward PE data till November, 2019

7
Fixed Income Outlook
 India’s 10-year bond yield rose marginally by 9bps to 6.6% MoM
Yield Spread
despite expectations of fiscal slippages due to weak GST
collections. Moreover, RBI’s announcement of ‘Operation Twist’ 11.0
to keep a check on the yield curve, put a lid on 10-year yields. 9.0
7.0
 RBI in a surprise move, kept the repo rate unchanged at 5.15%
due to sharp rise in retail inflation (Nov’ 2019: 5.5%). The apex 5.0
bank had already cut key policy rates 5 times in a row as the 3.0

Jun-11

Jun-15

Jun-17
Jun-10

Jun-12

Jun-13

Jun-14

Jun-16

Jun-18

Jun-19
Dec-09

Dec-10

Dec-11

Dec-12

Dec-13

Dec-14

Dec-15

Dec-16

Dec-17

Dec-18

Dec-19
inflation had been well within the regulator’s comfort levels.
However, the central bank maintained accommodative stance
and acknowledged scope for monetary easing depending on Earnings Yield (%) Bond Yields (%)
growth and inflation outlook.
 Indian rupee remained stable (at ~71 vs. US$) during the month 75 USD/INR
due to foreign inflows. Rupee showed notable resilience despite
70
steady rise in crude oil prices (~$66/bbl) and strength in the US$
due to positive developments around US-China trade talks. 65
 Although RBI is likely to remain accommodative owing to 60
domestic slowdown, there may not be multiple rate cuts in
future owing to limited monetary space. Thus, debt investors 55

Dec-14

Dec-15

Dec-16

Dec-17

Dec-18

Dec-19
Apr-16

Apr-18
Apr-15

Apr-17

Apr-19
Aug-15

Aug-16

Aug-17

Aug-18

Aug-19
are recommended to remain invested in shorter duration funds.
Note: NA
Source: ACE Equity, IIFL Research, NIFTY 2Y Forward PE & Yield Spread data till December 31, 2019

8
 Importance of Asset Allocation
The table ranks 10 asset classes 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
in order of their return Gold Gold Mid-Cap International Small-Cap Credit Risk G-Sec Small-Cap Gold International
performance-from the highest to 24.00 29.00 38.52 29.60 62.91 10.00 15.00 59.64 8.00 27.31
lowest-for each calendar year in
the 10-year period from 2010-19. Large-Cap Real Estate Small-Cap Large-Cap Mid-Cap Corporate Corporate Mid-Cap G-Sec Gold
For example, gold gave a return 17.43 17.72 36.45 8.98 54.69 Bond 9.00 Bond 12.00 48.13 8.00 18.00
of 24% in 2010, and large-caps Small-Cap Credit Risk Large-Cap Real Estate Large-Cap Mid-Cap Credit Risk Large-Cap Large-Cap Large-Cap
came in second with 17.43% in 16.69 8.00 25.70 7.46 29.89 7.43 12.00 27.91 5.91 12.65
the same year justifying the need
for asset allocation across Mid-Cap Corporate Real Estate Credit Risk G-Sec G-Sec Gold International Corporate G-Sec
multiple asset classes and 16.15 Bond 8.00 17.07 7.00 17.00 7.00 11.00 19.42 Bond 5.00 12.00
product categories.
International T- Bill International Corporate Credit Risk Small-Cap Real Estate Credit Risk Credit Risk Corporate
12.78 4.61 13.40 Bond 6.00 14.00 6.10 9.63 8.00 5.00 Bond 10.00
T-Bill: treasury bills; G-secs: govt.
securities; For large-cap, S&P BSE
Corporate G-Sec G-Sec T- Bill Bond Corporate T- Bill International Corporate Real Estate Credit risk
Sensex data; For mid-cap. S&P BSE
Midcap data; For small-cap, S&P BSE
Bond 7.00 4.00 13.00 5.50 Bond 13.00 5.38 9.54 Bond 7.00 4.83 8.00
Smallcap data; For T-Bills. CCIL Liquidity
Weight data; For G-secs, CCIL All Credit Risk International Gold G-Sec Real Estate Real Estate Mid-Cap Real Estate T- Bill T- Bill
Sovereign Bond Index data; For corp. 6.00 0.00 12.00 2.00 11.91 4.52 7.97 6.40 4.08 4.20
bonds, Crisil Corp. Bond Composite Index
data; For credit risk. Crisil Composite Real Estate Large-Cap Credit Risk Mid-Cap International International T- Bill Gold International Real Estate
Credit Risk data; For international, S&P 5.50 -24.64 11.00 -5.73 11.39 -0.73 4.73 6.00 -6.24 2.60
500 data; For gold, prices as per World
Gold Council; For real estate, RBI House G-Sec Mid-Cap Corporate Small-Cap T- Bill Large-Cap Large-Cap T- Bill Mid-Cap Mid-Cap
Price Index. 4.00 -34.19 Bond 11.00 -9.67 5.72 -5.03 1.95 4.03 -13.38 -4.01

Note: Returns as on December 20, 2019

T- Bill Small-Cap T- Bill Gold Gold Gold Small-Cap G-Sec Small-Cap Small-Cap
Data Source: Mint Research 3.00 -36.41 5.59 -18.00 2.00 -8.00 1.77 2.00 -23.53 -8.98

9
Outlook - 2020
 Pullback in US-China trade war and a decisive political mandate in the UK to manage Brexit deal is likely to alleviate global
uncertainty around the demand environment. Further, easing trade tensions will help reverse the falling global trade volumes. As a
result, global growth is expected to see expansion during the year 2020.
 Given that 2020 is an election year for the US, Federal Reserve is likely to keep the interest rates low throughout the year. Thus,
dovish monetary policy by the developed markets will keep the global liquidity at elevated levels for a considerable period of time.
 Emerging markets such as India, may see strong foreign inflows due to high global liquidity coupled with improved optimism around
the resolution of tariff wars. Thus, with ‘risk on’, 2020 could be yet another year of having upward trending global equity markets.
 Key commodities might make a come back in 2020 on high global liquidity and revival in demand after US-China trade settlements.
 On the domestic front, India’s growth scenario may remain challenging (in 1HCY20) due to consumption slowdown. However, the
economy may see green shoots of recovery as measures taken by the RBI and the Govt. are likely to bear fruits by 2HCY20.
 The govt. might dare to loosen its purse string to boost consumption and revive private investments despite unavailability of fiscal
space. Thus, fiscal situation is likely to remain stretched through 2020 and will force the Govt. to push through hard reforms.
 Despite stretched fiscal condition, Rupee may not feel significant pressure due to ebbing of external risks (easing trade war, hope of
smoother Brexit and dovish view of US Fed). Moreover, benign trade deficit and healthy FDI flows will continue to aid rupee.
 Indian bond yields too may not see significant upside due to RBI’s strong intent to normalize the yield curve through active OMOs.
 Indian equity markets may remain polarized (at least through 1HCY20) wherein select high quality stocks with earnings visibility may
continue to command rich valuations. Thus, our top picks include Bharti Airtel, ICICI Bank, L&T, Maruti Suzuki, SBI Life from large
cap space and Cummins, Gujarat Gas, Ashok Leyland, Sudarshan Chemical, Varun Beverages from mid cap space.

10
Wish List of Reforms
 Reducing regulatory uncertainty
 De-bottlenecking NBFC funding and Real Estate space
 Rationalizing GST rates and releasing pressure on small businesses
 Clearing pending dues to businesses
 De-bottlenecking power sector (levying tariffs a state subject)
 Moving all subsidies to DBT route
 Reforming state owned banks
 Removing LTCG, buyback and dividend taxes
 Accelerate privatization
 Land & labor reform to accelerate ‘Make in India’ drive

11
 Model Portfolios – Direct Equity
Investment Objective & Portfolio Strategy - Aggressive portfolio targets above market returns using high beta and midcap ideas. Moderate
portfolio uses Multi-cap approach to reduce volatility. Conservative portfolio is built with objectives of less volatility and capital protection.

Aggressive Allocation (%) Moderate Allocation (%) Conservative Allocation (%)

Tata Motors DVR 8 SBI Life 7 Bajaj Auto 8
Kalpataru Power 7 Bajaj Finance 7 Axis Bank 7
Deepak Nitrite 8 TCS 9 Hind. Uniliver 8
ICICI Bank 8 Bajaj Finserv 7 Hero Motocorp 8
Exide Industries 9 Tata Global Beverage 9 HDFC Bank 9
Sudarshan Chemicals 8 ICICI Lombard 9 ICICI Lombard 9
KEC International 9 Sun Pharma 9 ITC 7
Ashok Leyland 8 HDFC Bank 9 NTPC 8
SBI Life 9 Bharti Airtel 9 Titan 9
SBI 9 Reliance Industries 9 Reliance Industries 9
Axis Bank 8 Tech Mahindra 7 TCS 9
Quess Corp 9 Larsen & Toubro 9 Cummins India 9
Total 100 Total 100 Total 100
Risk Reward Statistics Risk Reward Statistics Risk Reward Statistics
Portfolio Beta 1.22 Portfolio Beta 0.86 Portfolio Beta 0.84
Sharpe Ratio 0.32 Sharpe Ratio 0.95 Sharpe Ratio 0.32
Portfolio Std. Deviation 34.45 Portfolio Std. Deviation 27.94 Portfolio Std. Deviation 25.1

12
Model Portfolio - Returns
Absolute % Returns CAGR % Return Valuation Multiples (1Yr Forward))
Portfolios/Index 6M 1 Yr 2 Yr Since Inception P/E P/BV
Aggressive 5.8 11.6 2.6 13.6 18.0 2.5
Moderate 8.0 16.2 3.5 12.4 30.3 4.1
Conservative (0.4) 2.6 (3.4) 4.6 24.1 6.8
NIFTY 50 3.2 12.0 7.9 11.7 18.5 2.7

Aggressive NIFTY Moderate NIFTY Conservative NIFTY

150 150 150

140 140 140

130 130 130

120 120 120

110 110 110

100 100 100

Oct-17

Oct-18

Oct-19
Aug-19
Aug-17

Aug-18
Jun-17

Jun-18

Jun-19
Apr-17

Dec-17
Feb-18
Apr-18

Dec-18

Apr-19

Dec-19
Feb-17

Feb-19
Oct-19
Oct-17

Oct-18

Oct-17

Oct-18

Oct-19
Aug-17

Aug-18

Aug-19

Aug-17

Aug-18

Aug-19
Jun-17

Jun-18

Jun-19

Jun-17

Jun-18

Jun-19
Feb-17
Apr-17

Dec-17

Apr-18

Dec-18

Apr-19

Dec-19

Apr-17

Dec-17

Apr-18

Dec-18

Apr-19

Dec-19
Feb-18

Feb-19

Feb-17

Feb-18

Feb-19
Note: NA
Source: ACE Equity, IIFL Research, returns as on December 31, 2019

13
IIFL Monthly
Mutual Fund
Recommendations

14
Recommended Equity/Hybrid Mutual Funds

Scheme Name Fund Manager AUM (₹cr) 1M (%) 6 M (%) 1 Y (%) 3 Y (%) 5 Y (%)

Nippon India Large Cap Fund (G) Sailesh Raj Bhan 13,010 0.8 (0.6) 7.3 14.0 8.9

ICICI Pru Midcap Fund (G) Mrinal Singh 1,884 (1.0) (0.8) (0.6) 8.2 6.9

HDFC Small Cap Fund (G) Chirag Setalvad 9,034 (0.6) (9.1) (9.5) 10.2 8.5

IIFL Focused Equity Fund (G) Mayur Patel 476 2.3 8.7 27.3 15.5 11.5

Mirae Asset Hybrid - Equity Fund (G) Neelesh Surana 3,005 0.7 4.0 11.9 13.1 --

ICICI Pru Asset Allocator Fund (G) Sankaran Naren 5,228 0.6 4.6 9.7 11.2 9.6

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF

15
 Nippon India Large Cap Fund
Fund Basic Details
Fund Benchmark S&P BSE 100 - TRI AUM (₹cr) 13,010
Nil up to 10% of units within 1Y and 1% for more than 10%
Inception Date August 2007 Exit Load
of units within 1Y, Nil after 1Y
Fund Manager Sailesh Raj Bhan Expense Ratio 1.8%

 It is an equity based fund that primarily invests (at least 80% of AUM) in top 100 Asset Allocation
companies by market capitalization.
3% Large Cap
 The key objective of this scheme is to generate long term capital appreciation by investing
predominantly into equity and equity related instruments of large cap companies. 2%
Mid Cap
 The scheme also aims to generate consistent returns by investing in debt, money market 14% 81% Small Cap
securities, REITs and InvITs.
Others
 As of November 2019, the fund had invested 81% of AUM in large cap stocks while 14% was
invested in mid cap stocks. The fund had highest allocation to Banks (29.0%) followed by
Returns (%)
refineries (8.2%).
 Its top stock holdings comprise of SBI (7.6%), HDFC Bank (6.8%) and ICICI Bank (6.1%). 14.0 14.9
10.9 9.3
 Investors who prefer to invest in a diversified portfolio of blue chip stocks can invest in 8.9
7.3
this fund to create wealth in the long term.
 This open ended fund is suitable for investors who have moderately high risk appetite
with investment horizon of at least 3 years.
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019 1 Year 3 Years 5 Years
Source: ACE MF Fund Benchmark

16
 ICICI Prudential Midcap Fund
Fund Basic Details
Fund Benchmark Nifty Midcap 150 – TRI AUM (₹cr) 1,884
Inception Date October 2004 Exit Load 1% on or before 1Y, Nil after 1Y
Fund Manager Mrinal Singh Expense Ratio 2.2%
 It is an equity based fund that aims to generate capital appreciation by actively managing Asset Allocation
a diversified portfolio of a mid cap stocks (at least 65% of AUM in companies ranked from
101st to 250th by market capitalization). 8% 8% Large Cap
 The fund looks to identify and invest in growing firms that have significant room for value 20% Mid Cap
unlocking. Management integrity is also a key criteria while screening stocks for investing.
Small Cap
 As of November 2019, the fund had invested 64% of AUM in mid cap stocks, while 20% was 64% Others
invested in small cap stocks. The fund had highest allocation to Banks & Financial Services
(20.2%) followed by Chemicals (7.2%).
 The scheme’s top holdings comprise of Indian Hotels Company (5.1%), PI Industries (5.0%) Returns (%)
and Tata Chemicals (4.7%). 11.0 9.9
8.2 6.9
 Investors who prefer to invest in mid cap stocks and are looking for relatively higher
returns in the long run can invest in the scheme. 0.6
 This open ended fund is suitable for investors who have moderately high risk appetite
with investment horizon of at least 5 years. -0.6

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
1 Year 3 Years 5 Years
Source: ACE MF
Fund Benchmark

17
 HDFC Small Cap Fund
Fund Basic Details
Fund Benchmark Nifty Small Cap 100 - TRI AUM (₹cr) 9,034
Inception Date April 2008 Exit Load 1% on or before 1Y, Nil after 1Y
Fund Manager Chirag Setalvad Expense Ratio 1.9%
 The scheme predominantly invests equity and equity related instruments of small cap Asset Allocation
companies (at least 65% of AUM in companies ranked 251st and beyond by market
capitalization). 4%
15% Large Cap
 It focuses on companies with reasonable growth prospects, sound financials, sustainable
business model and acceptable valuations that offer scope for capital appreciation. Mid Cap
15%
 As of November 2019, 67% of its AUM was invested in small cap stocks while 15% was Small Cap
66%
invested in mid cap stocks. The fund has highest allocation to Banks (9.2%) followed by IT Others
(7.8%).
 The fund’s top stock holdings comprise of NIIT Technologies (3.2%), Sonata Software (3.1%) Returns (%)
and DCB Bank (2.8%).
10.2 8.5
 Investors who are seeking to invest in a diversified portfolio of small cap stocks and 1.6 3.2
desire for superior returns in the long run can invest in this scheme.
 This open ended scheme is relevant for investors who have high risk appetite with
investment horizon of at least 7 years. -9.5 -8.5

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
1 Year 3 Years 5 Years
Source: ACE MF Fund Benchmark

18
 IIFL Focused Equity Fund
Fund Basic Details
Fund Benchmark S&P BSE 200 – TRI AUM (₹cr) 446
Inception Date October 2014 Exit Load 1% on or before 12M
Fund Manager Mayur Patel Expense Ratio 2.4%
 Focused category mutual fund schemes aim to generate superior return through a Asset Allocation
concentrated portfolio of equity & equity related instruments.
 IIFL Focused Equity Fund’s key objective is to generate long term capital appreciation from Large Cap
a portfolio of equity & equity related securities by investing in maximum 30 stocks of 8%
8% Mid Cap
various market capitalization. 64%
Small Cap
 The scheme follows multi cap approach with orientation towards large cap companies. Its
20%
stock selection criteria is based on three attributes viz. (1) companies which are prime Other
beneficiaries of secular growth, (2) companies which are poised for strong uptick in
performance due to cyclical upturn, (3) defensives which are poised for higher growth.
Returns (%)
 As of November 2019, the fund had invested 64% of AUM in large cap stocks while
allocation to mid cap and small cap stocks was 20% and 8% respectively. The fund had 27.3
highest allocation to Banks (27.0%) followed by NBFCs (12.5%). The fund’s top stock 15.5 14.5
10.4 11.5 9.6
holdings consist of ICICI Bank (10.2%) followed by HDFC Bank (9.3%) and Axis Bank (7.6%).
 Investors with moderately high risk appetite with a time horizon of at least 5 years, can
look to invest in this open ended scheme to accumulate wealth in the long run.
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
1 Year 3 Years 5 Years
Source: ACE MF
Fund Benchmark

19
 Mirae Asset Hybrid Equity Fund
Fund Basic Details
Fund Benchmark CRISIL Hybrid 35+65 - Aggressive Index AUM (₹cr) 3,005
Inception Date July 2015 Exit Load 1% on or before 1Y(365D), Nil after 1Y (365D)
Fund Manager Neelesh Surana Expense Ratio 2.0%
 It is an equity-oriented hybrid fund that invests 65-80% of AUM in equity and equity related Asset Allocation
instruments, 20%-35% in debt and money market instruments and up to 10% in the units of
REITs and InvITs. 3% Large Cap
16% 16%
 For equities, it focuses to identify high growth companies available at reasonable valuations Mid Cap
while for debt the focus is on Government securities and highly rated PSUs and corporates. 8% Small Cap
 As of November 2019, the fund had invested 68% of the total AUM in equities and rest in debt
Debt
and others. It had invested 57.2% of the equity in large cap stocks, while 8.2% was invested in
mid cap stocks. 57% Cash
 Within equities, the funds has highest allocation to Banking space (21.9%) followed by IT (6.2%).
It had highest allocation to HDFC Bank (6.4%) followed by ICICI Bank (5.2%) and Reliance Returns (%)
Industries (4.6%). 12.1
 Aggressive investors who prefer a balanced approach (growth + capital protection), can invest 13.1
in this scheme.
11.9 10.7
 This (aggressive) Hybrid category fund is suitable for investors with moderately high risk
appetite with at least 3 years of investment horizon.
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019 1 Year 3 Years
Source: ACE MF Fund Benchmark

20
 ICICI Pru Asset Allocator Fund
Fund Basic Details
Fund Benchmark CRISIL Hybrid 50 + 50 - Moderate Index AUM (₹cr) 5,228
Nil up to 10% of units within 1Y and 1% for more than 10%
Inception Date December 2003 Exit Load
of units within 1Y, Nil after 1Y
Fund Manager Sankaran Naren Expense Ratio 1.3%

 ICICI Pru Asset Allocator Fund is an open ended fund-of-funds (FoF) scheme which invests Asset Allocation (All the schemes are of ICICI Pru.)
in equity oriented schemes, debt oriented schemes and gold ETFs schemes. Bluechip Fund
2% 28% Floating Interest Fund
 It is an actively managed fund that aims to generate better risk-adjusted returns through
Large & Mid Cap Fund
optimum allocation of debt and equity based on their relative attractiveness and 6% Savings Fund
opportunities available in respective markets. 17%
8% All Seasons Bond Fund
 As of November 2019, the scheme’s portfolio consist of ICICI Prudential Blue chip Fund 11% Corp Bond Fund
(28.4%), ICICI Prudential Floating Interest Fund (16.7%), ICICI Prudential Large & Mid Cap 14% Money Market fund
Fund (14.4%), ICICI Prudential Savings Fund (13.7%), ICICI Prudential All Seasons Bond Fund 14% Others

(11.4%) and ICICI Prudential Corporate Bonds Fund (7.6%), ICICI Prudential Money Market Returns (%)
Fund (6.3%). 11.2 11.0
9.7 9.3
9.6
 The scheme is ideal for those investors who struggle around the most critical aspects of
investing that is asset allocation, instrument selection and timing the market. 10.7

 Conservative investors with moderately high risk appetite can invest in this scheme to
generate wealth in the long term.
1 Year 3 Years 5 Years
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019 Fund Benchmark
Source: ACE MF

21
Recommended Debt Mutual Funds
AUM YTM 1M 6M 1Y 3Y 5Y Rating Profile
Scheme Name
(₹cr) (%) (%) (%) (%) (%) (%) AAA & Equiv.

HDFC Overnight Fund 10,685 4.9 0.4 2.5 5.6 5.9 6.3 -*

Nippon India Liquid Fund 33,274 5.3 0.4 2.9 6.7 6.9 7.4 55.3

SBI Magnum Ultra Short Duration Fund 12,723 5.9 0.4 3.9 8.0 7.5 7.7 84.4

ICICI Pru. Savings Fund 21,987 6.5 0.4 4.4 8.8 7.7 8.2 76.8

IDFC Bond Fund - Short Term Plan 11,356 6.5 0.1 5.0 9.7 7.4 7.8 95.9

Axis Banking & PSU Debt Fund 11,517 6.4 0.0 5.4 10.5 8.4 8.4 91.3

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019; *100% investment in Cash & Cash Equivalent
Source: ACE MF

22
 HDFC Overnight Fund
Fund Basic Details
Fund Benchmark CRISIL Overnight Index AUM (₹cr) 10,685
Inception Date February 2002 Exit Load Nil
Fund Manager Anil Bamboli Expense Ratio 0.2%

 HDFC Overnight Fund aims to generate income through a portfolio of debt and money market Rating Profile
instruments with overnight maturity.
 Thus the scheme predominantly invests in Collateralized Borrowing & Lending Obligations
(CBLO), overnight reverse repos and fixed income securities / instruments with overnight
maturity. Cash & Eq.
 The average yield to maturity (YTM) of the fund is 4.9%.
100%
 As of November 2019, the fund had invested 100% of the total AUM in cash and cash
equivalent.
Returns (%)
 The fund is suitable for investors who are looking to park their corpus for smaller time period
and looking for lower risk compared to liquid funds. Fund also provides liquidity without any exit 1.2 1.2
load. 0.9

 Investors with low risk appetite and investment period of up to 3 months can invest in this fund. 0.4 0.4
0.1

1 Week 1 Month 3 Month

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019 Fund Benchmark
Source: ACE MF

23
 Nippon India Liquid Fund
Fund Basic Details
Fund Benchmark CRISIL Liquid Fund Index AUM (₹cr) 33,274
Inception Date December 2003 Exit Load Nil after 7D
Fund Manager Anju Chhajer Expense Ratio 0.3%
 Nippon India Liquid Fund focuses to maximize returns while ensuring adequate liquidity through Rating Profile
investments in various debt and money market instruments with maturity up to 91 days.
 The average maturity of the portfolio will typically be in a range of 30-60 days. AAA & Eq.
55%
 The investments in fixed income securities are done in such a manner that the modified Cash & Eq.
duration of the constructed portfolio is 0.10 years.
Sov
 The average yield to maturity (YTM) of the fund is 5.3%. 2%
33% 10% Others
 As of November 2019, the fund had invested 55% of the total AUM in AAA rated debt
instruments and 33% in Sovereign securities.
Returns (%)
 The fund is suitable for the investors who are looking for:
 Regular income over the short period of time 7.0
6.9 6.9
6.7
 Income through a portfolio comprising debt and money market instruments 7.4 7.4
 Investors with low risk appetite and investment period of up to 3 months can invest in this fund.

1 Year 3 Years 5 Years

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF
Fund Benchmark

24
 SBI Magnum Ultra Short Duration Fund
Fund Basic Details
Fund Benchmark NIFTY Ultra Short Duration Debt Index AUM (₹cr) 12,723
Inception Date May 1999 Exit Load Nil
Fund Manager Rajeev Radhakrishnan Expense Ratio 0.5%
 The fund’s objective is to generate regular income with high degree of liquidity through Rating Profile
investments in a portfolio comprising predominantly of debt and money market instruments.
 The scheme invests in debt instruments such that the Macaulay Duration of the portfolio is 2%
AAA & Eq.
between 3 months to 6 months. 8%
AA & Eq.
 The investments in fixed income securities are done in such a manner that the modified
duration of the constructed portfolio is 0.5 years. 6% Cash & Eq.
84%
 The average yield to maturity (YTM) of the fund is 5.9%. Sov
 As of November 2019, the fund had invested 84% of the total AUM in AAA rated debt
instruments, 6% in AA rated debt securities and 8% in cash and cash equivalent. Returns (%)

 The fund is suitable for the investors who are looking for: 8.0 7.9
 Regular income over the short period of time 7.7
7.5 7.6
 Attractive risk-adjusted returns through active management of credit risk and interest 8.2
rate risk in the portfolio
 Investors with low risk appetite and investment period of up to 6 months can invest in this fund.
1 Year 3 Years 5 Years
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF
Fund Benchmark

25
 ICICI Pru Savings Fund
Fund Basic Details
Fund Benchmark NIFTY Low Duration Debt Index AUM (₹cr) 21,987
Inception Date September 2002 Exit Load Nil
Fund Manager Rahul Goswami Expense Ratio 0.5%
 The key objective of this fund is to generate income through investments in a range of debt and Rating Profile
money market instruments while maintaining the optimum balance of yield, safety and liquidity.
 The scheme invests in debt instruments such that the Macaulay Duration of the portfolio is 7%
2% AAA & Eq.
between 6 months to 12 months.
AA & Eq.
 The investments in fixed income securities are done in such a manner that the modified
14% Sov
duration of the constructed portfolio is 0.7 years. 77%
 The average yield to maturity (YTM) of the fund is 6.5%. Cash & Eq.
 As of November 2019, the fund had invested 77% of the total AUM in AAA rated debt
instruments, 14% in AA rated debt securities and 2% in sovereign securities. Returns (%)

 The fund is suitable for the investors who are looking for: 8.8 8.8 8.2
7.9
7.7
 Short term savings 7.5

 Debt fund that generates returns while maintaining adequate yield, safety and liquidity
 Investors with moderately low risk appetite and investment period between 6 months to 12
months can invest in this fund.
1 Year 3 Years 5 Years
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF
Fund Benchmark

26
 IDFC Bond Fund - Short Term Plan
Fund Basic Details
Fund Benchmark CRISIL ST Bond Fund Index AUM (₹cr) 11,356
Inception Date December 2000 Exit Load Nil
Fund Manager Suyash Choudhary Expense Ratio 0.8%
 The scheme aims to generate income from a portfolio which comprises of short duration debt Rating Profile
and money market instruments.
4%
 The scheme invests in debt instruments such that the Macaulay Duration of the portfolio is
between 1 year to 3 years.
AAA & Eq.
 The investments in fixed income securities are done in such a manner that the modified
duration of the constructed portfolio is 1.8 years. Cash & Eq.
96%
 The average yield to maturity (YTM) of the fund is 6.5%.
 As of November 2019, the fund had invested 96% of the total AUM in AAA rated debt
instruments and remaining in cash and cash equivalent. Returns (%)

 The scheme is suitable for those investors who are looking for:
9.7 10.4
 Optimal returns over short to medium term 7.4 7.3 7.8 8.3

 Alternative to bank deposits

 Investors with moderately low risk appetite and investment period between 1 year to 3 years
can invest in this fund.
1 Year 3 Years 5 Years
Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF
Fund Benchmark

27
 Axis Banking & PSU Debt Fund
Fund Basic Details
Fund Benchmark Nifty Banking & PSU Debt Index AUM (₹cr) 11,517
Inception Date June 2012 Exit Load Nil
Fund Manager Aditya Pagaria Expense Ratio 0.6%
 Axis Banking & PSU Debt Fund aims to generate income through investing in debt instruments Rating Profile
of Banks, Public Sector Undertakings (PSUs) & Public Financial Institutions (PFIs).
 The investments in fixed income securities are done in such a manner that the modified 7%
duration of the constructed portfolio is 1.9 years. AAA & Eq.
2%
 The average yield to maturity (YTM) of the fund is 6.4%. Sov
 As of November 2019, the fund had invested 91% of the total AUM in AAA rated debt Cash & Eq.
91%
instruments while 7% was parked in cash and cash equivalent.
 The scheme is ideal for those investors who are looking for:
Returns (%)
 Alternatives to traditional fixed savings instruments
 Medium term savings 10.5 10.4
8.4 8.4 7.9
6.9
 Investors with moderately low risk appetite and investment horizon of at least 2 years can
invest in this fund.

1 Year 3 Years 5 Years

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; AUM as on November 2019; Returns as on December 31, 2019
Source: ACE MF
Fund Benchmark

28
Riskometer
Scheme Name Riskometer Suitable for investors who are looking to…

 Create long term wealth by investing in a diversified portfolio of blue

Nippon India Large Cap Fund chip stocks.
 Invest in equity oriented mutual funds for at least 3 years.

 Generate relatively higher returns by investing in a diversified portfolio

ICICI Prudential Midcap Fund of mid cap stocks.
 Invest in equity oriented mutual funds for at least 5 years.

 Generate superior returns by investing a diversified portfolio of small

HDFC Small Cap Fund cap stocks.
 Invest in equity oriented mutual funds for at least 7 years.

 Aims to generate superior return through a concentrated portfolio of

IIFL Focused Equity Fund equity & equity related instruments.
 Invest in equity oriented mutual funds for at least 5 years.

 A balanced approach (growth + capital protection) to create wealth

Mirae Asset Hybrid Equity Fund over the long period of time.
 Invest in equity oriented mutual funds for at least 3 years.

 Generate better risk-adjusted returns through optimum allocation of

ICICI Pru Asset Allocator Fund
debt and equity.

29
Riskometer
Scheme Name Riskometer Suitable for investors who are looking for…

 Regular income over the short period of time.

HDFC Overnight Fund  Income through a portfolio comprising debt and money market
instruments with overnight maturity.

 Regular income over the short period of time.

Nippon India Liquid Fund  Income through a portfolio comprising debt and money market
instruments.

 Regular income over the short period of time.

SBI Magnum Ultra Short Duration Fund  Attractive risk-adjusted returns through active management of credit
risk and interest rate risk in the portfolio.

 Short term savings.

ICICI Pru Savings Fund  Debt fund that generates returns while maintaining adequate yield,
safety and liquidity.

 Optimal returns over short to medium term.

IDFC Bond Fund - Short Term Plan
 Alternative to bank deposits.

 Optimal returns over medium term period.

Axis Banking & PSU Debt Fund
 Alternative to traditional fixed savings instruments.

30
Aggressive Model Portfolios – Mutual Funds
 The objective of the strategy is to generate substantial wealth in the long run for investors from a portfolio of aggressive equity oriented
mutual funds.
 The strategy takes a concentrated position in mutual funds across different market-cap and sectors and endeavors to strategically
change allocation between different market-cap and sectors depending on change in the business cycles.

Absolute % Returns CAGR % Return Quant's

Allocation
Sr. No Scheme Name
(%)
6M 1 Yr 3 Yr 5 Yr Beta NAV

1 Mirae Asset Large Cap Fund(G) 20.0 4.1 12.7 15.8 11.8 1.0 54.3

2 IIFL Focused Equity Fund(G) 20.0 8.7 27.3 15.5 11.5 1.0 18.2

3 Kotak Emerging Equity Scheme(G) 20.0 3.6 8.9 11.2 10.5 0.8 40.5

4 HDFC Small Cap Fund(G) 20.0 (9.1) (9.5) 10.2 8.5 0.7 38.5

5 ICICI Pru Asset Allocator Fund(G) 20.0 4.6 9.7 11.2 9.6 0.1 58.9

Total 100.0

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; NAV, Returns as on December 31, 2019
Source: ACE MF

31
Moderate Model Portfolios – Mutual Funds
 The objective of the strategy is to generate long term capital appreciation for investors from a portfolio of equity oriented mutual funds
with a moderate risk appetite. Primarily to beat inflation without having too much volatility.
 The strategy takes a concentrated position in mutual funds across different market-cap and sectors and endeavors to strategically
change allocation between different market-cap and sectors depending on change in the business cycles.

Absolute % Returns CAGR % Return Quant's

Allocation
Sr. No Scheme Name
(%)
6M 1 Yr 3 Yr 5 Yr Beta NAV

1 Nippon India Large Cap Fund(G) 15.0 (0.6) 7.3 14.0 8.9 1.1 35.7

2 IIFL Focused Equity Fund(G) 15.0 8.7 27.3 15.5 11.5 1.0 18.2

3 ICICI Pru Equity & Debt Fund(G) 25.0 2.2 9.3 10.2 9.2 0.1 140.0

4 HDFC Mid-Cap Opportunities Fund(G) 20.0 (1.3) 0.2 8.0 8.2 0.8 53.6

5 SBI Magnum Low Duration Fund(G) 25.0 4.1 8.3 7.5 7.9 0.1 2,561.7

Total 100.0

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; NAV, Returns as on December 31, 2019
Source: ACE MF

32
Conservative Model Portfolios – Mutual Funds
 The objective of the strategy is to generate long term capital appreciation for investors from a portfolio of equity and debt oriented
mutual funds. Primarily to avoid any potential loss and preserve capital.
 The strategy takes a concentrated position in mutual funds across different market-cap and sectors and endeavors to strategically
change allocation between different market-cap and sectors depending on change in the business cycles.

Absolute % Returns CAGR % Return Quant's

Allocation
Sr. No Scheme Name
(%)
6M 1 Yr 3 Yr 5 Yr Beta NAV

1 IDFC Bond Fund - Short Term Plan(G) 25.0 4.9 9.8 7.4 7.8 0.3 40.6

2 HDFC Top 100 Fund(G) 15.0 (4.5) 8.2 13.3 7.8 1.0 495.3

3 DSP Equity & Bond Fund(G) 20.0 5.9 14.2 11.4 9.4 0.1 163.7

4 SBI Magnum Multicap Fund(G) 15.0 1.9 11.0 12.8 10.8 0.9 51.1

5 ICICI Pru Asset Allocator Fund(G) 25.0 4.6 9.7 11.2 9.6 0.1 58.9

Total 100.0

Note: Returns less than 1 year are absolute; Returns greater than 1 year are CAGR; NAV, Returns as on December 31, 2019
Source: ACE MF

33
Non-MF Product
Recommendations

34
 IIFL Multicap and Multicap Advantage PMS
IIFL Multicap PMS
The objective is to generate long term capital appreciation for investors
from a portfolio of equity & equity related securities.
The portfolio manager aims to achieve the investment objective by:-
 Investing in a concentrated basket of 20-25 stocks with a bias towards
large cap stocks
 Actively use sector rotation to align with changes in business cycles to
generate Alpha
 Portfolio Manager shall follow the SCDV framework for portfolio
construction
IIFL Multicap Advantage PMS
The portfolio manager aims to take a concentrated position in portfolio of 20-
25 stocks with a bias towards Large cap stocks with an objective of generating
wealth over long period; at the same time hedge the portfolio using At the
Money Nifty 50 Put option to safeguard against downside risk
Investment Allocation :-
 Equity Investment – up to 100% of corpus
 Put Options (for Hedging) – up to 8% of corpus*
 Liquid scheme of Mutual funds and other securities as per FM discretion

Investment Philosophy – SCDV Framework

 Cyclical (PAT>15%, ROE <15%) – Companies/ Sectors that show high growth
but are affected by market cycles, hence need to be timed for entry and exit
 Secular (PAT>15%, ROE >15%) – High growth companies / sectors which show
consistent growth across market cycles
 Defensive (PAT<15%, ROE >15%) – Companies / sectors that show consistent
stable growth across market cycles
 Value Trap (PAT<15%, ROE <15%) – Companies/ sectors that are at attractive
valuation but do not show commensurate growth.

35
 IIFL Multicap and Multicap Advantage PMS
Performance
Strategy/Benchmark 1 Month (%) 3 Month (%) 6 Month (%) 1 Year (%) 2 Year (%) 3 Year (%) Since Inception
IIFL Multicap PMS 1.43 13.14 6.55 27.76 13.81 16.11 18.88
IIFL Multicap Advantage 0.95 10.77 5.42 23.45 - - 10.91
S&P BSE 200 TRI 1.28 9.61 1.99 10.37 6.91 13.79 -
Returns as on November 30, 2019
Fund Manager
Aniruddha Sarkar, Strategy Manager for IIFL Multicap PMS, has over 13 years of experience in the Financial Services sector. He is associated with IIFL
Wealth Management Group for 11 years and has been involved in identifying investment ideas across various sectors and market-caps that can generate
alpha for the investors. He has been one of the key members involved in setting up the entire equity advisory desk at IIFL Wealth. Prior to working with IIFL
Wealth, he was working with a UK based hedge fund. He holds an MBA in Finance from IMI, New Delhi and a Bachelor’s degree in Commerce from St.
Xavier’s College, Calcutta.

KEY TERMS
Setup fee 2% of the invested amount
Management fee 2.50% per annum. Management fee will be computed on Daily NAV (charged monthly)
Brokerage 0.12% of the transaction value (plus applicable statutory levies)
Other charges Statutory/Other charges as applicable(STT/Demat/Custodial Charges/Service Tax, etc.)
Exit fees If withdrawn: Within 9 months: 4%; 9-18 months: 3% ;18-24 months: 2% ; 24-36 months: 1%
Recommended Investment horizon 36 months and above
Taxation As per equity taxation
Returns less than 1 year are absolute; Returns greater than 1 year are CAGR 36
 Sundaram Emerging Leadership Fund (S.E.L.F.) PMS
The objective of the strategy is to seek long term capital appreciation with investments in mid-cap companies.

The portfolio manager aims to achieve the investment objective by:-

 Taking a bet on Sundaram’s mid & small cap strength but differentiated with a concentrated portfolio and attractive cap curve positioning
 Creating a concentrated 20-30 stocks multi sector portfolio
 Picking Stocks with less than Rs. 500bn market cap
 Identifying stocks in the Mid & Small Cap space that are in early stages of their business cycle and could emerge as tomorrow’s large caps.

3Qs - Quality approach to stock selection Portfolio to capture India story

Quality of Business
Pricing power, profitability, growth, brand strength, capital intensity, complexity of
business
Quality of Management
Track record, management bandwidth, corporate governance
Quality of Financials
Capital allocation, leverage, cash flow generation, return on capital

37
 Sundaram Emerging Leadership Fund (S.E.L.F.) PMS
Performance
Strategy/Benchmark 1 Month (%) 3 Month (%) 6 Month (%) 1 Year (%) 3 Year (%) 5 Year (%) Since Inception
S.E.L.F. Strategy 2.1 11.3 0.0 10.6 11.0 10.0 15.9
NSE Midcap 100 2.4 10.0 -4.1 -1.6 4.9 6.8 8.3
Inception date – June 2010 Returns as on November 30, 2019
Fund Manager
Madanagopal Ramu joined Sundaram Asset Management Company Limited (SAMC) in October 2010 as a research analyst, covering industrials,
infrastructure, cement and logistics. At SAMC, prior to becoming the Fund Manager of PMS & AIF, he was the Head of Research for the Mutual Fund
division. He has over 12 years of experience in research and over 5 years of experience in Fund Management. Prior to SAMC, he worked with Centrum
Broking (P) Ltd. as a Research Analyst tracking power and capital goods. He is an MBA from BIM Trichy and a Cost Accountant.

KEY TERMS
Minimum Investment 25 Lakh
Setup fee 2% of the invested amount
Management fee 2.50% per annum
Exit fees If withdrawn: Within 1 year: 4%; 12-24 months: 2%; 24-36 months: 1%
Recommended Investment horizon 36 months and above
Taxation As per equity taxation

Returns less than 1 year are absolute; Returns greater than 1 year are CAGR 38
 IIFL High Conviction Fund – Cat III AIF
IIFL High Conviction Fund intends to create a concentrated portfolio of 15-20 high conviction stocks, which are:
 Key beneficiaries of the secular growth drivers
 Poised for a strong uptick in earnings and cash flows
 Offer an attractive risk-reward
The fund would be following a mix of top-down (macro analysis to identify sectors) and bottom-up approach (micro analysis to pick stocks within these
sectors) for portfolio construction using the SCDV framework

SCDV Framework Investment Philosophy

Industry or sector potential – Look for growing sectors, at the same time
avoid sectors which are vulnerable to regulation changes, high competitive
intensity, technological changes and short growth cycles
Business – Look for companies with competitive advantages that have
delivered consistently higher ROE than peers while avoiding companies with
poor free cash flows and declining market share
Governance – Prudent capital allocation, in line with minority shareholder
interest would be an important criteria while selecting investments
Valuations – Companies which offer a favorable risk reward ratio

Core Portfolio – Secular stocks will form a core portfolio of the fund. They provide consistency and stability to the overall portfolio with lower risk
Tactical Allocation – Cyclical and Defensive stocks will be used to take benefit of cyclical trends of the market and generate extra alpha

39
 IIFL High Conviction Fund – Cat III AIF
Performance
Fund is in the collection stage hence performance history of the fund is not available. However, performance of IIFL High Growth Companies Fund Cat III
AIF which follows a similar strategy is as follows:
Strategy/Benchmark 1 Month 3 Month 6 Month 1 Year 2 Year 3 Year Since Inception#

IIFL High Growth Companies Fund 2.13 12.30 5.48 21.58 - - 23.93

S&P BSE 200 TRI 1.28 9.61 1.99 10.37 - - 10.7

Returns as on November 30, 2019
Fund Manager
Mehul Jani has over 15 years of experience in covering and managing financial services and consumer stocks. Prior to working with IIFL, he has worked
with DSP Blackrock for 10 years. Prior to DSP Blackrock, he worked with Morgan Stanley Plc, London, for 4 years, as an associate, dealing with structured
product valuation and fund derivatives. Mehul is an alumnus of Cass Business School, London and holds Masters in Banking and International Finance. He
also holds a CFA charter
Key Terms
A1 A2 A3
Capital commitment 1 Cr to < 5 Cr 5 Cr to < 15 Cr 15 Cr and above
Fixed Management Fee 2.50% 2.10% 1.75%
Set up Fees (up to) 2.00% 2.00% 2.00%
Profit Share (without catch up) Nil Nil Nil
0-12 months after lock in period* - 3%
Exit load (applicable post lock in period*)
12-24 months after lock in period* - 2%
Initial Drawdown 25% of the commitment amount
*Lock in period: 12 month from final drawdown date
#Inception date is November 1, 2018 40
Returns less than 1 year are absolute; Returns greater than 1 year are CAGR
 Purnartha Equity Advisory
• Purnartha started out as a unique equity investment advisory firm. Their philosophy is based on choosing non-cyclical companies, ensuring that the
investments are poised to reap long-term gains.
• Over the years, Purnartha has consistently outperformed benchmarks such as NIFTY and helped several families grow and prosper together with their
research-backed, clear & unbiased advice.

Performance Inception date is April 01, 2009 ; Returns as on November 30, 2019

1 Month (%) 3 Months (%) 6 Months (%) 1 Year (%) 2 Years (%) 3 Years (%) 5 Years (%) Since Inception (%)

Purnartha Portfolio 1.54 14.49 9.58 32.15 10.9 28.6 23.46 42.86
NIFTY 50 1.5 9.37 1.12 10.84 8.83 13.91 7.17 14.12
Midcap 50 1.79 10.82 -4.84 -1.2 -4.94 8.17 6.82 14.29

Investment Advisory Plans

Minimum Tenure 1 Year Min Tenure 3 Year
Minimum Amount 25 Lakh Min Amount 10 Lakh
Plan A (%) Plan B (%) Plan C(%) Plan D (%) Plan E (%) Plan F (%) IIFL Exclusive Plan (%)
Initial Advisory Fee 2.50 2.00 1.75 1.50 1.00 0.60 Initial Advisory Fee 7.50
Profit Sharing Above Profit Sharing Above Hurdle
20.00 20.00 20.00 20.00 20.00 20.00 20
Hurdle Rate Rate
Hurdle Rate 25.00 15.00 12.00 10.00 6.33 0.00 Hurdle Rate 75

41
 Unlisted Shares
Many young companies grow much faster than mature companies due to their lower base, and hence tend to significantly
outperform the benchmark returns. However, a lot of this growth happens before the company goes public with an IPO.
Hence, participating in such companies in the Growth / Pre-IPO stage can provide superior returns to the investor.

Absolute % Return

Stock 3M 6M 1Yr Current Offer Price#

HDB Financials 11.65 5.02 22.99 1150

HDFC Securities 4.20 -23.20 -35.22 7450
Hero Fincorp 13.79 1.54 -9.17 990
Nazara Technologies -19.42 -20.57 -27.74 560
One97 Communication (Paytm) 3.16 -5.56 -8.11 17000
TATA Technologies -14.75 -20.00 -28.77 1300
Utkarsh Micro Finance -2.95 -13.21 -6.12 230
Returns as on December 30, 2019

42
 Bonds
Tax Free Bonds
Tax Free Yield# Gross Yield*
Security Coupon (%) Maturity Interest Payment Rating
(%) (%)
PFC 2027 8.3% 01 Feb 2027 15/10 - Ann 5.62% 8.72% AAA
HUDCO 2028 7.51% 16 Feb 2028 15/02 - Ann 5.63% 8.73% AAA
NHAI 2031 7.39% 09 Mar 2031 01/10 - Ann 5.66% 8.78% AAA
NHAI 2030 7.28% 18 Sep 2030 02/04 - Ann 5.68% 8.81% AAA
IIFCL 2033 7.40% 22 Jan 2033 22/01 - Ann 5.69% 8.83% AAA
*Grossing up by maximum marginal tax rate of 35.535%

Perpetual Bonds
Security Coupon (%) Call / Put Option Interest Payment Yield# (%) Rating
State Bank of India 8.50% 22-Nov-24 22-Nov 8.03% AA+ by CRISIL/ICRA
BOB Perpetual 8.70% 28-Nov-24 28-Nov 8.40% AA+
Bank of Baroda Perpetual 8.99% 18-Dec-24 18-Dec 8.42% AA+
Indusind Bank Ltd 9.50% 22-Mar-23 22-Mar 9.75% AA By Crisil & IR

#Yields are as of December 30.2019

**Bond yields are subject to availability and market movement. Please confirm yields as well as availability before finalizing 43
any deal.
 Bonds
Taxable Bonds

Security Coupon Maturity Interest Payment Yield# (%) Rating

ONGC Petro 2025 (1cr multiple) 8.83% 10-Mar-25 10-Dec 8.28% AAA/Stable by ICRA & Care

Axis Finance 2027 8.08% 14-Sep-27 14-Sep 8.18% AAA by CRISIL & IR

M&M Financial Services 2029 9.50% 18-Jan-29 1-Apr 8.31% AAA IR & CARE

IRFC 2030 ^ 8.79% 04-May-30 15-Oct and 15-Apr 7.48% AAA by CRISIL & CARE

Bank of Baroda 2024 ^ 7.75% 11-Sep-34 11-Sep 7.54% AAA by ICRA & Care

#Yields are as of December 2.2019

^ Limtied quantity available

**Bond yields are subject to availability and market movement. Please confirm yields as well as availability before finalizing 44
any deal.
IIFL Credit Enhanced Market Linked Debenture
A Principal Protected, listed & Rated Market Linked Debenture (Rated AA+ Pay-off:
r(CE) by CRISIL) Issued by India Infoline Finance Ltd. (Rated AA by CRISIL)
backed by Gold loan receivables originated by IIFL and assigned to the SPV
with the below features

 Credit Enhancement:
• MLD issued is bankruptcy remote i.e. Investor is not subject to the credit risk of
the issuer
• Guaranteed by SPV, which will service cash flow if not paid by the issuer
• SPV holds Gold Loans worth 1.25x of Nominal Value of the Debentures issued
throughout the tenor of MLD
• Extra collateral in the form of Bank Guarantee (@7% of the issue size) will be Illustrative Cash-flows:
provided to the SPV by the issue
 Lock-in attractive yields:
• MLD offers 9.00% p.a. pre-tax yield which is attractive in medium term
• Other AAA rated instruments are currently yielding about 8% p.a. Pre-tax
 Tax -Efficient wrapper:
• The structured product will be issued as listed secured NCD. Capital Gain arising
from the sale of these NCDs will be taxed at 10% + applicable surcharge and
cess
 Pay-outs post 12 months of the issue: Please Note: the above illustration tables is for representation purpose only. The actual
• Month-on-month cash flows from the pay-outs after 12 months of the issue interest payout will be determined based on the actual payout schedule and yield fixed at
9% p.a. (pre-tax, after factoring-in principal payment)

45
IIFL Credit Enhanced Market Linked Debenture
Terms Description Terms Description

Issuer IIFL Finance Clean Price of underlying security on Trade

Initial Level
Date
Credit Rating of the
AA by CRISIL Clean Price of underlying Security on date
Issuer
Final Level falling 5 BD prior to the date on which the
Instrument Credit Enhanced Market Linked Debenture entire Principal is repaid
If Final Value >50%*Initial Value then
Credit Rating of the Principal + Coupon (TBD); Else only Principal
AA+ r (CE) by CRISIL
Instrument
Initial Value = Clean Price of underlying
security on Trade Date
Tenure 18M/24M Pay-off
Final Value = Clean Price of underlying
Return (XIRR) 9% p.a. (based on pay-off)* Security on Trade Date+18M
Underlying Index / Security : 7.26% GS 2029
Benchmark / (10yr G-Sec)
7.26% GS 2029
Underlying
Face Value per
10 Lacs
Collateral Gold Loan Pool and Bank Guarantee Debenture
Min Investment
10 Lacs & further in multiple of 10 Lacs
Amount
Liquidity Listed on NSE
Issue Size Rs. 400 Crores
*The actual interest pay-out will be determined based on the actual pay-out schedule and yield fixed at 9% p.a. (pre-tax, after factoring-in principal payment)

46
IIFL Pure Debt MLD
Pure Debt MLD

Issuer India Infoline Finance Limited

Type of Instrument Principal Protected – Market Linked Redeemable Non-Convertible Debenture

Credit Rating CRISIL PP MLD AAr (Stable Outlook)

If Final Fixing Level>25% of the Initial Fixing level 22.738%

Product Payoff
If Final Fixing Level<=25% of the Initial Fixing level 0.000%

Product functions as High Yield, Hold-to-Maturity Debt Substitute

Pure Debt MLD

Residual Tenure ~22 months

Coupon 22.738%

Pre-Tax IRR 9.5%

Post-Tax IRR 8.33%

47
 Disclaimer
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
Nothing in this document constitutes investment, legal, accounting or tax advice or a representation that any investment or strategy is suitable or appropriate to the investor's specific circumstances. The details included are
based on information obtained from public sources and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed.
Investors should consult their financial advisers if in doubt about whether the product is suitable for them. The fund may or may not be suitable for all investors, who must make their own investment decisions, based on their
own investment objectives, financial positions and needs. This document may not be taken in substitution for the exercise of independent judgment by any investor. The investor should independently evaluate the investment
risks.
India Infoline Ltd. or any of its director/s or principal officer/employees and associate companies (IIFL) does not assure/give guarantee for accuracy of any of the facts/interpretations in this document, and shall not be liable to
any person including the beneficiary for any claim or demand for damages or otherwise in relation to this opinion or its contents.
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returns depicted are in the current context and may be significantly different in the future.
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Please refer to http://www.indiainfoline.com/research/disclaimer for recommendation parameter, analyst disclaimer and other disclosures.
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