The Seven Companies Listed Herein Seem Attractive from Investment Perspectives 12:40 AM 100%11:15

RNI No. MAHENG/2009/28962 | Volume 10 Issue 12 | 16th - 31st Dec ’18 Mumbai | Pages 56 | For Private Circulation

The seven companies listed herein seem attractive from investment perspectives 12:40 AM 100%11:15

XYZ Stock XYZ 12:40 Sunday, 12 November

XYZ

> slide to unlock

UNRAVEL THE UNKNOWN The BEYOND App untangles complex market movements, offering you in-depth research calls and investment strategies that help meet your requirements. Explore the unknown absolutely free. Download BEYOND App on

eyond Powered by

Disclaimer: Insurance is a subject matter of solicitation. Mutual Fund investments are subject to market risks. Investment in Securities/Commodities market are subject to market risks. Read all the related documents carefully before investing. Please read the Do’s and Don’ts prescribed by the Commodity Exchange before trading. We do not offer PMS Service for the Commodity segment .The securities quoted are exemplary and are not recommendatory. NIRMAL BANG SECURITIES PVT LTD – BSE (Member ID- 498): INB011072759, INF011072759, Exchange Registered Member in CDS; NSE MEMEBR ID- 09391): INB230939139, INF230939139, INE230939139; MSEI Member ID-1067) : INB260939138, INF260939138, INE260939139: Single Registration No.INZ000202536,PMS Registration No: INP000002981; Research Analyst Registration No: INH000001766; NSDL/ CDSL: IN-DP-CDSL 37-99. NIRMAL BANG COMMODITIES PVT LTD – MCX (Member ID -16590 /NCDEX Member ID -0362 /ICEX Member ID -1165) : Single Registration No. INZ000043630; NCDEX Spot: 10084; Comtrack Participants: CPID -5040; CDSL Commodity Repository Ltd: 12013300 Nirmal Bang Securities Private Limited CIN: U99999MH1997PTC110659; Nirmal Bang Commodities Private Limited CIN: U67120MH1995PTC093213

For account opening, give us a missed call on 18003157577 | www.nirmalbang.com DB Corner – Page 5 BEYOND THINKING A Dovish Pause RBI expects in ation to come down in the future. Focus shifts to policy transmission – Page 6 Crisis On Our Plates Structural reforms are needed to lift farmers out of distress, not band-aids like loan waivers – Page 9 Brewing Hot The seven companies listed herein seem attractive from investment perspectives – Page 12 Changing Landscape The long-term outlook for the retail industry is positive, supported by rising incomes, favourable demographics, entry of foreign players, and increasing urbanization – Page 22 Lighting Up The Future Volume 10 Issue: 12, 16th - 31st Dec ’18 The automotive lighting segment is showing great promise and is expected to do well in the near future – Page 26

Editor-in-Chief & Publisher: Rakesh Bhandari Heading Towards A Breakdown Editor: Tushita Nigam The crisis in the NBFC sector is hurting auto sales in India – Page 29 Senior Sub-Editor: Kiran V Uchil Jobs In Peril Art Director: Sachin Kamble Job losses is an inevitable truth and people must adapt themselves Junior Designer: Orianne Fernandes to changing times – Page 32 Operations: Namrata Sabbani BEYOND BASICS Rising To The Occasion Research Team: Sunil Jain, Vikas Salunkhe, Swati Hotkar, Nirav Chheda, Amit Bhuptani, Despite volatility in the markets, few mutual funds from the Runjhun Jain, Akansha Jain, Nandish Shah, small-cap and mid-cap space have given better returns over the past Jehan Bhadha, Dnyanada Vaidya few years – Page 35 Printed and published by Mr Rakesh Bhandari Towards Financial Independence on behalf of Nirmal Bang Financial Services Pvt Ltd, printed at Uchitha Graphic Printers Pvt Ltd Pension plans are great for those seeking nancial independence 65, Ideal Ind. Estate, Senapati Bapat Marg, after retirement – Page 38 Lower Parel, Mumbai – 400013 and published at Nirmal Bang Financial Services Pvt Ltd, 19, BEYOND NUMBERS Sonawala Building, 25 Bank Street, Fort, Buckfast Recommendations – Page 40 Mumbai-400001. Editor: Tushita Nigam Technical Outlook – Page 45 CORPORATE OFFICE B-2, 301/302, Marathon Innova, BEYOND LEARNING O Ganpatrao Kadam Marg, Technologies Of Tomorrow Lower Parel (W), Mumbai - 400 013 Tel: 022 - 6273 8000/8001 Managing nances is a cakewalk today thanks to the unlimited options being oered by Fintech companies – Page 46 Web: www.nirmalbang.com [email protected] BEYOND BUZZ Tel No: 022 - 6273 8047 Important Jargon – Page 51

3 Beyond Market 16th - 31st Dec ’18 It’s simplied... EDITORIAL

Tushita Nigam Editor NEW YEAR READY The Research Team at Nirmal Bang has narrowed down on seven well-researched companies that you, our readers, can look at from investment perspectives. The main purpose of initiating this task is to give you a base to align your existing portfolios while taking into consideration the current market scenario, which you will read about in the cover story of this issue. However, please keep in mind that doing your homework on these companies is of utmost importance and a cardinal rule before making any investment in the stock markets.

The other articles included in this issue are the outcome of the Monetary Policy Meet held earlier this month and what can be expected going forward, the ongoing farm distress in the country with focus on the ground reality and remedial measures that can be taken to deal with the issue at hand, and how the year has been for the retail sector and what can be expected in 2019.

Also featured are articles on the automotive lighting segment that seems to be on a strong footing, the impact of the crisis in the non-banking financial companies (NBFCs) on the auto sector. Additionally, there is an article on the job market in India, with emphasis on the employment opportunities in the country.

The Beyond Basics section carries two interesting reads. While one article talks about pension plans and the need to invest in them, the other is about mutual fund schemes from the small- and mid-cap space that have given good returns over the past few years and can be deemed as over-performers.

Do not miss the list of holidays for domestic and key international stock markets that has been shared in a cut-and-keep format for our readers.

And as this year comes to a close, here is wishing you and all your loved ones a very happy and a prosperous New Year. May the New Year bring health, wealth and happiness to alL.

4 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... DB CORNER

In the coming fortnight, the Indian stock markets are likely to remain range-bound.

In the previous fortnight, the US markets witnessed a correction due to the fear of growth being affected. This is mainly due to the withdrawal of the quantitative easing (QE) program, increase in interest rates by the Federal Reserve and the ongoing trade war with China .

Brent crude oil prices fell sharply owing to excess supply in the markets.

The Indian stock markets have outperformed world equity markets mainly due to domestic liquidity and the recent appreciation of the Indian rupee.

In the coming fortnight, the Indian stock markets are likely to remain range-bound. The Nifty is likely to find support around the 10,680 and 10,615 levels. On the upside, it is likely face resistance around 10,860 and 10,940, thereafter.

Investors and traders are advised to keep a close watch on expectations building up for the Decem- ber quarter earnings results of India Inc. Similarly, the movements in the US equity markets and crude oil prices should also be observed by them as these events are likely to have an impact on the markets in the coming monthS.

Sensex: 35,649.94 Disclaimer Nifty: 10,729.85 It is safe to assume that my clients and I may have an investment interest in the stocks/sectors discussed. Investors are required to take an independent decision before investing. Investment in (As on 26th Dec ’18) equity is subject to market risk. Our research should not be considered as an advertisement or advice, professional or otherwise. The investor is requested to take into consideration all the risk factors including their financial condition, suitability to risk return profile and the like and take professional advice before investing.

5 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

from the central bank during cash inflation to come down in the future. crunch stands at 6.5%. The RBI has lowered its inflation projection to 2.7% to 3.2% from the Even the ‘calibrated tightening’ earlier 3.9% to 4.5% for the second stance was retained by the MPC. In half of 2018-19. The RBI has the October ’18 MPC meet, the RBI retained its gross domestic product shifted its stance from ‘neutral’ to (GDP) growth estimate for FY19 at ‘calibrated tightening.’ Calibrated 7.4%. For FY20, the RBI projected a tightening means that a rate cut is off growth rate of 7.5%. the table, while the RBI is not bound to increase interest rates in every Although policy rates and stance meeting. were kept untouched, the RBI announced a few important he Reserve Bank of India’s monetary While the overall stance was regulatory measures. Statutory policy committee (MPC) – which is retained, importantly the RBI expects Liquidity Ratio (SLR) – the portion responsible for fixing interest rates in of bank’s deposits that mandatorily India – kept policy rates unchanged needs to be parked in government Tat its meeting on 5th December. bonds and other instruments – has Repurchase rate (repo) or rate at been cut from current 19.5% to 18%. which commercial banks borrow A The Reserve Bank has also proposed RBI expects inflation to come down in the future. Focus DOVISH shifts to policy transmission PAUSE

6 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... to benchmark all new floating rate RBI Growth & Inflation Outlook For India loans to an external yardstick from CPI Inflation (%) Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 April ’19. Dec’18 (5th Bi-monthly) 2.8 3.2 3.8 4.2 REGULATORY MEASURES Oct’18 (4th Bi-monthly) 4 4.5 4.8 - Aug’18 (3rd Bi-monthly) 4.7 4.8 5 - External Benchmark For New Jun’18 (2nd Bi-monthly) 4.7 4.7 - - Floating Rate Loans Apr’18 (1st Bi-monthly) 4.6 4.4 - - From April next year, all new Real GDP Growth (%) Q3 FY19 Q4 FY19 Q1 FY20 floating rates - personal, retail, and Dec’18 (5th Bi-monthly) 7.1 7 7 7.2 micro, small and medium enterprise Oct’18 (4th Bi-monthly) 7.3 7.2 7.4 - (MSME) loans by banks will have to be benchmarked to an external Aug’18 (3rd Bi-monthly) 7.6 7.3 7.5 - yardstick. Jun’18 (2nd Bi-monthly) 7.2 7.3 - - Apr’18 (1st Bi-monthly) 7.2 7.5 - - What this means is that the banks at Source: RBI, SBI their discretion can decide the spread over a particular external benchmark introduced in 2003. Base rate system banks. Banks mostly depend on retail for a category of loan. The external was introduced in 2010. Most recent deposits, which are inflexible to benchmarks allowed by the RBI are: was the Marginal Cost of market movements. Hence, assets RBI’s policy repo rate, or 91 days Funds-based Lending Rate, or (advances) will get repriced ahead of Treasury bill, or 182 days Treasury MCLR, which was introduced in the liabilities (deposits) under the bill or any other benchmark market year 2016. external benchmark system. This will interest rate produced by the expose banks to margin volatility and Financial Benchmarks India Private So, why is the RBI pushing for interest rate risks. This can lead to Ltd (FBIL). The RBI is likely to external benchmark? These internal asset-liability mismatch (ALM). come out with detailed guidelines by benchmarks have failed to transmit the end of December. any monetary policy measure taken Lower Mandatory Bond Buying by the RBI. All the above were The spread over loan, so benchmark opaque and arbitrary. Banks need to invest in cash, gold on external yardstick, should remain reserves, and other government- unchanged through the life of the Analysis: Switchover to an external approved securities to maintain SLR loan. The bank will also have to benchmark is a flexible system. requirements. SLR has been cut from adopt a uniform external benchmark Increase or decrease in external current 19.5% to 18% of deposits. within a loan category. In other benchmark, which mostly is But, the reduction will happen in a words, the adoption of multiple market-determined, will maintain staggered manner. Every quarter benchmarks by the same bank is not transparency, standardization, and SLR will be cut by 25 basis points allowed within a loan category. ease of understanding. An external over the next six quarters starting rate benchmark is a much better way from January ’19 to reach the 18% For starters, benchmarking loans to to address issues around ineffective level. external rates is the fourth such monetary policy transmission. change in lending structure in the last Analysis: Current SLR level one decade. Benchmark Prime While the move is positive for the maintained by all banks is to the tune Lending Rate or BPLR was end consumer, it is net negative for of 29%, way above the mandated

Monetary Policy Transmission: Different Phases Of The Monetary Policy Cycle Policy Cycle Repo Rate WACR CBLO Market Repo 91-Day T-Bills 3-Month CD MIBOR 3-Month MIFOR 3-Month MIFOR 3-Month OIS 1-Year OIS 1-Year G-Sec 5-Year G-Sec 10-Year G-Sec Easing Phase April ’12 - June ’13 -125 -165 -150 -136 -106 -165 -179 -193 -193 -80 -37 -37 -63 -90 Tightening July ’13 - December ’14 75 118 150 127 80 43 124 148 148 53 20 71 17 32 Easing Since January ’15* -200 -225 -252 -249 -222 -240 -235 -266 -266 -210 -150 -207 -140 -126 * Up to August ’17 Source: RBI

7 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... 19.5%. Public sector banks maintain short-term liquidity disruptions. SLR Even inflation measured by high SLR as compared to the private and LCR cannot co-exist. Thus, in wholesale price index (WPI) for sector. This is because of lower risk order to align the SLR with the LCR November came in at 4.64%, lower appetite of public sector banks and requirements, the RBI has cut SLR than 5.28% registered last month. lower lending opportunities in the mandate. The Index of Industrial Production economy. But as demand for credit (IIP) saw a sharp rise of 8.1% in rises in the economy, lower SLR will IN A NUTSHELL October against 4.5% in September. free up bank resources for more lending. The above two measures will help More importantly, the price of Indian efficient transmission of monetary crude basket collapsed to below US According to SBI, the move will policy in the future. It is important to $60/barrel by end-November after release around `1.5 lakh crore of stress that the probability of a rate touching US $85/barrel in early incremental liquidity in the system. cut has only increased in the future. October. This augurs well for India’s This would help keep lending rates Thus, it is important to have an current account deficit and the Indian stable or even push them lower. efficient mechanism ready, which rupee. may lead to credit growth in the There is one more reason as to why economy and support GDP growth as The RBI has a mandate to keep CPI SLR has been slashed by the RBI. well. inflation below 4% level, while Basel III norms – best international supporting economic growth. With norms pushed by Bank of To be sure, since 5th December, key better-than-expected data, the RBI is International Settlement – require macro-economic data released have all set to change its stance to ‘neutral’ banks to maintain a liquidity surprised the markets on the upside. from ‘calibrated tightening.’ The next coverage ratio (LCR). Under LCR, For instance, inflation measured by MPC will come out with its interest banks need to hold enough high consumer price index (CPI) for rate decision on 7th February. Even quality liquid assets such as November stood at a 17-month low the probability of a rate cut in the government papers to overcome any of 2.33%. It was 3.38% last month. next MPC meet has increaseD.

eyond Powered by

Contact at: 022-6273 9600 | e-mail: [email protected]

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

8 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

CRISIS ON OUR PLATES

Structural reforms are needed to lift farmers out of distress, not band-aids like loan waivers

Over the last few months, farmers agri-trade surplus from $26 billion to have been protesting across the $14 billion in 2017-18. country drawing attention to the drop in agri prices and growing distress. Also, compared to 2013-14, So how grave is the situation and profitability in most of the major what lies ahead? crops is down by at least one-third in 2017-18. The annual growth rate of THE STATUS farmers’ real incomes has fallen to about 2.5% in the four years. In the last four years, the Indian economy has grown at an average Public investment in agriculture has rate of 7.2%, but the agriculture GDP remained between 0.3% and 0.4% of grew at 2.5% per annum. the GDP between 2011-12 and n rumble to the 2019 general Investments in agriculture as a 2016-17. The total investment, public elections, the raging agrarian crisis in percentage of agri-GDP fell from and private, has declined from 3.1% the country has come into sharp 17.7% in 2013-14 to 15.5% in of the GDP in 2011-12 to 2.2% in Ifocus. 2016-17. 2016-17. With the Congress party doling out Agri-exports fell from $42.4 billion The farmers are not just buffeted by loan waivers in the three states it has in 2013-14 to $38 billion in 2017-18, low prices. Extreme weather clinched power, there is growing while agri-imports rose from $16 conditions and skewed rainfall is pressure on the central government billion in 2013-14 to $24 billion in adversely affecting yields, putting for a pan-India loan waiver. 2017-18. This has nearly halved the them first on the frontline to bear the

9 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... brunt of climate change. technical education. Similarly, only case with pulses, and selling produce 14.6% of the rural workforce of age at the wrong time can lead to prices The majority of India’s farms (86%) group 15-59 years received of that particular crop falling. are less than two hectares, the bulk of vocational training. which are located in the poorer states Jowar and bajra farmers are unlikely of the country. MINIMUM SUPPORT PRICE to realise any benefit as there is little demand for them in the open market. While small farmers are more Higher MSPs have not always productive than larger ones - they use resulted in increases in farmer For maize, farmers may have to sell more inputs such as fertilizers, plant incomes as procurement is mostly below MSP as procurement has been more crops and adopt more restricted to wheat, paddy and cotton. discontinued after 2013-14. technology - yet, farm incomes have Sugar is the only other commodity Large-scale procurement is also not stayed stagnant. that is assured of purchase at the fair desirable as huge losses will be and remunerative price announced by incurred, according to experts. It is the poor returns despite intensive the government. efforts that are at the root of India’s PRIVATE SECTOR farm crisis, say experts on agriculture In the entire North-East and eastern sector. states such as Bihar, Jharkhand and The current Agriculture Produce West Bengal, the procurement Marketing Committee EMPLOYMENT infrastructure is very weak and (APMC)-based model is not farmers there have no hope of working. It is a model made totally From 72.4% of India’s rural receiving higher MSP for kharif for the intermediaries and does not economy, and employing 85.5% of crops. help the farmer or the end consumer. the rural workforce in 1970-1971, the size of agriculture had nearly halved Only 6% of farmers are able to sell Under the state APMC Acts, the now. It formed 39.2% of India’s rural their produce at MSP, according to a farmers need to sell their produce at economy in 2011-12, but still survey by the National Sample state-owned mandis, which makes it employed 64.1% of the rural Survey Office. expensive for them as they have to workforce, according to Niti Aayog. bear the transport cost. There are at least five central There is some solace that it has fallen government schemes to provide MSP Several intermediaries in the process dramatically from 72.6% of the rural support to farmers. have to be paid commissions, leaving workforce in 2004-2005. a significantly lower share for the As these schemes show, the benefit farmer over the final price to the Ideally, any sector that is producing of higher MSPs for kharif crops is consumer. around 39% of output should employ unlikely to be available to most the same percentage of the farmers as the states lack adequate Experts say the role of the private workforce. storage capacity, working capital and sector in agricultural marketing manpower for undertaking cannot be ignored and efforts should But if that were to happen, nearly 8.4 large-scale procurement of all be made to attract organized private crore agricultural workers would commodities. sector agri-business companies in have to be shifted to sectors other agricultural trade through appropriate than agriculture, amounting to almost Successive governments haven’t incentives and reducing legal hurdles 70% increase in non-farm been able to build a procurement by amending APMC Act and employment, experts said. operation that is spread across the Essential Commodities Act. entire country. In addition to this, the The proposition is difficult to achieve governments do not have the According to the government’s Price as the agriculture workforce lacks capability for procurement operations Policy for Kharif Crops - The skills for other sectors. for all the 22 crops for which the Marketing Season 2018 - 2019 MSP is announced. document, “Enabling mechanism are According to Niti Aayog, only 1.3% also required to be put in place for of the rural workforce of the age Experts said storing rice and wheat is procurement of agricultural group 15-59 years possessed relatively simple, which is not the commodities directly from farmers’

10 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... field and to establish effective season to support farm investment Amid adverse weather conditions, linkages between farm production, twice a year for the rabi and kharif farmers were helped in states like the retail chain and food processing seasons. Chhattisgarh, Haryana, Madhya industries.” Pradesh and Odisha, where insurance It has made an allocation of `12,000 companies paid them five times the EXPORTS crore for the scheme in the 2018-19 premium. state budget, one of the moves that A study of India’s agricultural helped the Telangana Rashtra Samiti Under the crop insurance scheme, the policies between 2000 and 2016 by (TRS) reap rich gains in the farmers have to pay a uniform OECD and ICRIER found that assembly polls. premium of 2% for kharif crops and trade-distorting policies such as 1.5% for rabi, and rest of the cost is export prohibitions, export quotas, LOAN WAIVERS shared by state and central export duties, or minimum export government. prices have impeded the export of In the last four years, farm loans several key commodities and have been written off in Andhra Industry analysts too see the depressed producer prices. Pradesh, Chhattisgarh, Jammu & government not opting for loan Kashmir, Karnataka, Maharashtra, waivers for farmers despite electoral For example, export restrictions or Punjab, Puducherry, Telangana, Uttar losses. bans were applied to wheat, Pradesh and Tamil Nadu. non-basmati rice, chickpeas, sugar No new large farm-loan waivers or and milk at different times over the The loan waiver has been mostly other fiscal sops are expected to be course of the period studied. announced for farmers of states announced in the run-up to general going for elections. elections. BHAVANTAR BHUGTAN YOJANA Experts caution on another round of THE SOLUTION loan waivers, already unleashed by The price deficiency payment the Congress party. It may cost the According to sector experts, the bulk scheme was implemented in Madhya government more than `2 lakh crore. of the `2.4 lakh crore of food and Pradesh in Kharif 2017 where the fertilizer subsidies can be paid out as government paid the difference However, according to media reports, cash to the urban poor and marginal between the market price and the the central government, despite farmers. MSP. losses in three major states, may not go in for farm loan waivers. The The central government can maintain The scheme is efficient and prompt, government’s key focus is on basic buffer stocks, and states should and is also not distortionary as it Pradhan Mantri Fasal Bima Yojana, be allowed to run minimum support does not favour one crop over or the crop insurance scheme. price or farm support scheme. Paying another. NITI Aayog has been given cash will enable poor farmers to the mandate of suggesting The government wants the scheme to lease out their lands and look for alternatives, and there may be a guarantee timely payments that must other jobs. launch of a national scheme of price be paid directly to farmers, and not to deficiency payment, as per experts any private company or trader. Experts said if agriculture generates tracking the sector. less than 15% of GDP and supports About 20 private insurance the livelihoods of more than three RYTHU BANDHU SCHEME companies are involved with the times that number, farmers have to scheme and they all may be forced to be pulled off the farm. The Telangana government has shell out interest in cases of delayed implemented the Rythu Bandhu payments. The Indian farmer is not risk-averse; scheme (Agriculture investment and, anecdotal evidence suggests, is support) to support the investment of The crop insurance scheme may also more risk-friendly than industrialists, farmers for two crops a year. start covering more calamities to but needs state’s help to make big secure farmers from vagaries of strides, experts said. Given the The government is providing 5.83 nature such as excessive rains and intense glare on the issue, 2019 may million farmers `4,000 per acre per forest fires. show the waY.

11 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

BREWING HOT

The seven companies listed herein seem attractive from investment perspectives

12 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... he stock markets are volatile at the readers must always do their own leg moment with mid-cap and small-cap work before making investments in indices underperforming the the stock markets. benchmark index, and, therefore, warrant financial prudence by These stocks from various sectors investors. will add sparkle to your portfolios and balance out risk-rewards To make this task easy for market associated with investing. participants, the team at the equity research desk at Nirmal Bang has The article particularly elaborates on chosen seven stocks it thinks are the company’s background, its worth considering. Nonetheless, investment rationale and financials. KARUR VYSYA BANK T Return To Roots Incorporated in 1916, Karur Vysya Bank (KVB) is a regional private bank having a strong presence in Southern India. The bank has a wide branch network of 788 branches as on Q2 FY19 with a majority of branches in rural and semi-urban areas, which has helped KVB position itself as a key SME player.

A majority of its advances and branches are from Tamil Nadu at 46% and 53%, respectively. At the end of Q2 FY19, the bank’s advances stood at `46,480 crore. The loan book is spread across corporate (30%), SMEs (34%), retail (18%) and agriculture segments (17%).

INVESTMENT RATIONALE stellar performance in its core The aggressive growth in the segment of SMEs, its decision to corporate book and the stress New Management With Extensive aggressively grow the corporate book thereafter had dented the asset Track Record In Retail Banking: over FY07-12 and the subsequent quality of the bank. Post the Mr PR Seshadri joined KVB in stress due to defaults in the corporate induction of new MD Mr. PR September ‘17 as the MD and CEO. book landed the bank in trouble. Seshadri in Q2 FY18, KVB has He is a seasoned banker with SMEs up-fronted most of the pending stress and Retail banking experience of Since FY14, KVB has shifted its pertaining to legacy corporate book. over 25 years spanning multiple focus towards Retail and SMEs. We Except for IL&FS exposure of `310 geographies, mainly with Citibank. expect retail book (18% mix) to grow crore, likely to slip in H2 FY19, we at 24% CAGR over FY18-21E. SME believe KVB is on track to reduce its He has a proven track record of loans (34% mix) have grown at just credit costs structurally. building and leading large teams as 9% CAGR over FY14-18 on the well as executing complex business back of five failed monsoons out of KVB is likely to commence FY20E objectives. Mr Seshadri’s extensive the past seven years in the home state with a clean slate and expect credit experience and expertise in Retail & of Tamil Nadu. We expect its SME cost to decline from 2.6% in FY19E SMEs shall aid KVB in improving book to grow at 15% CAGR over to 1.9%/1.5% in FY20/21E. Decline efficiency and accelerate the pace of FY18-21E. in credit cost may be the key lever retailization of its loan book. contributing to increase in ROA from Asset Quality Deterioration To 0.5% to 1.2% over FY19-21E. Also, Re-Aligning Focus To Retail And Peak In H2FY19; Expect Steep we expect ROE to expand from 5.9% SME Lending: Despite the bank’s Decline In Credit Costs In FY20E: in FY19E to 14.3% in FY21E, an

13 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... increase of 840 bps. SME segments while building assets and transformation into a revenue as well as profit momentum granular and higher RoE business, VALUATIONS (loan/PAT CAGR of 15%/71%, combined with cheap valuations at respectively, over FY19-21E), 1.2x FY20 ABV provides a good Sharpening focus on the retail and up-fronting recognition of problem scope for re-rating.

FINANCIALS

Year NII (` cr) PBP (` cr) PAT (` cr) EPS (`) PE (x) Adj BVPS (`) P/ABV (x) RoE (%) FY18 2,298 1,777 346 4.8 16.4 60.6 1.4 6.1% FY19E 2,444 1,806 376 4.7 16.6 54.7 1.6 5.9% FY20E 2,808 2,197 799 10.0 7.8 62.9 1.4 11.5% FY21E 3,250 2,610 1,106 13.8 5.6 73.4 1.2 14.3% Source: Nirmal Bang Research, Company Data ICICI BANK Clear Skies Ahead

Promoted by the erstwhile ICICI Ltd, ICICI Bank was incorporated in 1994. Currently, it is one of India’s largest private sector banks with an asset base of `8.7 trillion. ICICI Bank through its subsidiaries has an established presence in life and general insurance, asset management, and equity broking segments. The bank has presence in the country with 4,867 branches and 14,417 ATMs.

INVESTMENT RATIONALE rating mix has also improved with towards loan growth and NIMs. 66% of loans rated A and above vs Asset Quality Woes Behind; 62% in FY18 and 52% in FY16. Near-term business growth will be Improvement Underway: After driven by retail business and the many years of course correction, the Management Focus Shifts Back To share of high profit making products pool of stressed loans and slippages Growth: ICICI Bank’s loan growth (mainly by cross sell) like credit are now showing signs of a has been steadily improving (13% cards, personal loans and business continuous reduction (slippage at year-on-year in Q2 FY19). Muted banking is likely to go up. The retail 2.4% in Q2 FY19, a 12 qtr low), loan growth on the corporate lending business matrix remains healthy with which fortifies our belief that ICICI side remains a drag as there is a large (i) CASA ratio of ~51% (ii) Bank’s asset quality woes are a thing share of loans that the bank is Contribution to fees at 72% (iii) of the past. looking to reduce its exposure. Higher share of secured loans (~90% of retail loans) and (iv) continued The pullback in asset quality Retail loans continue to witness healthy loan growth (21% y-o-y). In (GNPAs dipped 30 bps over FY18 to strong growth (21% y-o-y in Q2 corporate loans, working capital and 8.54% as on Q2 FY19) and uptrend FY19); a trend similar to previous transaction banking related loans are in calculated PCR (up from 48% in quarters. The share of retail loans to likely to be key drivers. Structural FY18 to 60% in Q2FY19) has been overall loan mix continues to rise (up improvement in liability and ALM inspiring. Further, quick resolution of 300 bps y-o-y to 57% as on Q2 profile over the last few years has lumpy stressed loans under FY19). With a steep decline expected helped ICICI Bank to maintain NIMs IBC/NCLT would act as a trigger for in slippages and credit costs, at ~3.3%, despite rising competition multiple expansion. ICICI Bank’s management focus is now shifting within the retail business.

14 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... VALUATIONS operating profits. business) are other key positives.

ICICI Bank is in the midst of an The management has provided for We expect the bank to deliver an improvement in operating guidance of ~15% RoE all-round improvement in asset environment (stressed asset (consolidated) for Q1 FY21 and net quality, growth and margins over the resolution and growth pick-up) and is NPA of 1.5% of loans (4.1% as on next few years, thereby leading to a showing healthy signs of earnings Q2 FY19). Strong capitalization (tier structural shift to higher ROE levels. normalization. With challenges I of 15.4%), significant improvement related to management transition in granularity of book (~62% retail + Valuations at 1.5x Adj. BV (post getting addressed, the focus of the SME) and sustained improvement in adjusting for value of subsidiaries) bank is now on growing core liability profile (helping to de-risk appear attractive.

FINANCIALS

Year NII (` cr) Growth PAT (` cr) EPS (`) PE (x) Adj BVPS (`) P/ABV (x) RoA (%) RoE (%) FY17 21,737 2% 9,801 16.8 14.2 116 2.1 1.3 10.7 FY18 23,026 6% 6,778 11.1 21.4 120 2.1 0.8 6.8 FY19E 26,319 14% 6,169 11.0 21.6 138 1.8 0.8 5.8 FY20E 30,594 16% 14,290 23.4 10.2 163 1.5 1.5 12.3 Source: Nirmal Bang Research, Company Data INDIAN HOTELS Check In(To) The Upcycle

Indian Hotel Company Ltd is one of the largest hotel chain operators in India, with presence across the pricing spectrum through its four brands – Taj, Vivanta, SeleQtions and Ginger. It manages 17,360 rooms across India and international locations.

Around 85% of its room inventory is in the domestic market, while the rest is outside India. Domestic business remains the key driver, contributing around 78% of its consolidated revenue.

INVESTMENT RATIONALE favourable, with demand growth dynamics (easy price discovery via (10% to 12%) likely to outpace digital platforms and entry of Hotel Industry Coming Out Of A supply growth (5% in the coming MNCs). Franchises with strong Decade Long Hibernation: The years). Occupancy has been inching brand names and undertaking robust level of new inventory (supply up from 58% in FY13 to 67% in constructive structural changes such growth of 11% v/s room demand FY18. Such favourable demand- as Indian Hotels will be an attractive growth of 10% over FY08-18) kept supply dynamics were last observed play in the upcoming industry hotel room rates in check (industry in the previous upcycle, when upcycle. ARRs declined at a CAGR of ~3% occupancy jumped from 65% to 69% over FY08-18). However, with new to 72%. Historical trends, thus, Operating Leverage To Drive room additions slowing down, the indicate promising prospects in terms Growth In Profitability: During the market is finally absorbing the of both occupancy and room rates. last industry upcycle (FY04-08), additional supply. Indian Hotels delivered standalone We expect industry ARR growth of revenue/EBITDA CAGR of Fundamentals for the Indian ~8% to 10% v/s CAGR of 22% over 27%/64% on account of operating hospitality industry are now turning FY04-08 due to change in industry leverage. The company is likely to

15 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... witness huge operating leverage VALUATIONS cost, (iii) cost-rationalization, (iv) coming through in the current increase in ARR of corporate clients, upcycle too. Consolidated revenue/EBITDA are (v) higher room addition under expected to grow at a CAGR of management contracts and (vi) Occupancy in the standalone 8%/21% over FY18-20E. deleveraging of balance sheet are business is expected to improve by expected to drive earnings, going 400 bps to 69%, with ARR CAGR of Indian Hotel’s balance sheet is forward. 7% over FY18-20. Indian Hotels is expected to strengthen further due to also likely to benefit from higher asset monetization and higher free Also, with demand likely to outpace room addition under the management cash flow generation. ROE is likely supply over the coming few years, contract route and cost to improve from 2.3% in FY18 to pan-India ARR is likely to improve rationalization. Consequently, we 7.7% in FY20. in both the corporate and individual expect consolidated EBITDA margin segments. Valuations at 20x/16x to expand by 400 bps to 20.3% over Strategic initiatives such as (i) selling FY20/21 EV/EBITDA appear FY18-20E and EBITDA CAGR of off of loss-making hotels, (ii) focus reasonable considering the upcycle 21% over the same period. on technology to reduce distribution has just commenced.

FINANCIALS

Year Revenues Growth EBITDA Margin PAT Margin EPS PE EV/EBITDA ROE FY18 4104 2% 667 16.3% 101 2.5% 0.9 172 29 2.3% FY19E 4451 8% 835 18.8% 256 5.8% 2.2 66 23 5.9% FY20E 4799 8% 974 20.3% 354 7.4% 3.0 49 20 7.7% FY21E 5295 10% 1185 22.4% 507 9.6% 4.8 30 16 10.3% Source: Nirmal Bang Research, Company Data VAIBHAV GLOBAL LTD Back On Track

Vaibhav Global Ltd. (VGL) is a global retailing company selling through Web and TV channels in the US and the UK. It has an end-to-end B2C business model for fashion and lifestyle accessories. It reaches 100 million households on full-time equivalent basis in both markets combined.

INVESTMENT RATIONALE There are 8-10 online retail segments also like fashion companies in the US, which are accessories, lifestyle products, etc. Asset Light Scalable Model: engaged in the same space. However, This helps the company to increase Vaibhav Global is a retail company due to VGL’s low-cost base, it has its wallet size with the same having presence in the US and the the lowest average selling price. customer without much incremental UK through television and Internet. marketing costs. It has a manufacturing base in India. Due to the reach of Internet and TV It sources materials from various in the developed markets, the Execution success of company’s countries to gain the benefit of low business model is highly scalable and strategy can be verified from the fact cost. It offers products at a discount to have deeper penetration the that average annualized quantity (but profitable) for the entire year. company has started with other purchases by each customer have

16 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... increased to 29 pieces at the end of company took various initiatives like VGL has a high fixed cost (cost of Q2 FY19 as compared to 24.5 pieces restructuring of its back-end channel, employees, inventory, etc) in FY16. operations, launching Budget pay model, which is a boon in case of (EMI), introducing an easy returns growth period (higher volumes Proactive And Agile Management: policy, launching a mobile app, etc. and/or better realizations) as higher Despite increased competitive All these steps brought the company growth directly translates into intensity, VGL sailed through the on to a level-playing field. EBITDA margins. hardships due to management agility. Some PE funded new players came VALUATIONS For FY19, the company has given into the market with much more guidance of mid-teens volume aggressiveness and gave better Over the years, VGL has positioned growth in constant currency. schemes to attract customers. This itself as a strong player in discount shook VGL’s base and the company electronic retail segment. It provides We like the asset-light business reported a decline in sales and an unmatched value proposition of model of VGL and we believe that profitability in FY16. offering lowest average selling price the company is ready for its next leg in addition to all options, which of growth journey. We expect sales to However, the management took the competitors offer. It has the benefit grow at a CAGR of 15% during whole situation as an opportunity to of low-cost base, which gives it FY18-21E and EBITDA margins to rebuild the business model and leverage in competing with other improve from 9.4% in FY18 to compete with its peers head on. The players. 11.5% in FY21E.

FINANCIALS

Year Net Sales Growth EBITDA EBIDTAM APAT PATM EPS P/E EV/EBITDA ROE FY18A 1575.4 9.5% 148.4 9.4% 112.5 7.1% 34.5 20.6 16.1 22.8% FY19E 1851.2 17.5% 194.4 10.5% 142.6 7.7% 43.8 16.2 11.6 23.3% FY20E 2134.9 15.3% 243.4 11.4% 179.4 8.4% 55 12.9 9.9 23.8% FY21E 2422.2 13.5% 278.6 11.5% 203.6 8.4% 62.5 11.4 7.6 22.0% Source: Nirmal Bang Research, Company Data WELSPUN CORP LTD (WCL) A Pipedream Come True

Welspun Corp Ltd (WCL) is a part of the Welspun Group and provides comprehensive pipe solutions. WCL manufactures line pipes ranging from 1.5” to 140” including LSAW, HSAW, HFIW and ERW pipes. WCL has total manufacturing facilities of 2.42 Mn MTPA in five manufacturing plants across India, USA and Saudi. Of the 2.42 Mn T capacity, India has 1.6 Mn T, USA 0.525 Mn T and Saudi 0.3 Mn T.

INVESTMENT RATIONALE Trump administration, local sourcing started picking up in the US market is the only feasible option in the US. with rising oil prices. The cost of Strong Growth Expected In North Welspun is one of the largest steel extracting shale oil including capital America: Owing to the imposition pipe manufacturers in the US market cost is around $38 per barrel. of section 232 and various other with a market share of 25% to 30%. Currently, oil prices are ruling in the anti-dumping duties by the Donald Shale oil and gas projects have range of $50-$70, making it

17 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... profitable to extract and transport it. Madhya Pradesh will drive the order likely to start executing other orders book in the near term. in the beginning of FY20, which are The order book from the US for profitable. As such the Saudi WCL is currently around 5.24 lakh T Saudi Operations To Witness A operation is likely to turnaround in with visibility till December ’19. Turnaround: WCL owns a 50% FY20. These orders are at much higher stake in a joint venture in Saudi. EBIDTA per tonne. With higher Saudi operations have suffered losses Higher Operating Cash Flow To capacity utilization, WCL is targeting due to lower capacity utilization and Help Reduce Net Debt To Zero: further orders from the US and higher steel prices. However, WCL has reduced its net debts from expects to get even EBIDTA per currently the order book at Saudi `1,910 crore in FY15 to `395 crore tonne. stands at 8.71 lakh MT as against the as on 30th Sept ’18 without diluting capacity of 3 lakh MTPA, giving it its equity. With no major capex lined High Order Book And Healthy higher visibility. up except for a spiral steel plant in Pipeline: As on 30th September, Madhya Pradesh, the company’s cash WCL has an order book of 1.723 Mn Currently, the company is executing flow from operations will be used to T valued at `14,800 crore, which is a its first loss-making order, which is pare down its debt. clear visibility for the next two years. likely to continue till the end of Currently, there is also a healthy FY19. Being long-duration orders, WCL plans to be net debt zero by the pipeline of nearly 2.1 Mn T. Of this, the company has kept steel prices end of FY20. With higher cash we expect around 25% to 30% win open in Saudi. With the recent price generation, it intends to give it back for WCL going by their past history. correction in steel, losses are to its shareholders in the form of New orders for water projects in expected to reduce. The company is higher dividend/buy backs.

FINANCIALS

Year Revenues Growth EBITDA Margin PAT Net Profit Margin EPS PE EV/EBITDA RoE FY17 5,898 -18% 512 8.7 26.4 0.4% 1 144 9.6 1.0% FY18 7,542 28% 684 9.1 158 2.1% 5.9 24 6.2 5.5% FY19E 9,088 20% 858 9.4 252 2.8% 9.5 15 4.6 8.1% FY20E 9,655 6% 986 10.2 452 4.7% 17 8 3.5 12.6% Source: Nirmal Bang Research, Company Data PI INDUSTRIES LTD Spreading Far And Wide

PI Industries is an agrochemicals company engaged in patent-led global custom research manufacturing services (CSM) and in-licensed patented products in domestic business. CSM business contributes 60% (FY18) of business and the rest comes from domestic business.

INVESTMENT RATIONALE Space: Since FY15, the global commodity prices (b) higher channel agro-space has witnessed a inventories (3) extreme climate Recovery In Global Agrochemicals slowdown due to (a) subdued vagaries (4) consolidation between

18 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... global agro-giants. All the above To de-risk its business, PII has company has a strong balance sheet factors led to a decline in global started working in pharma and fine and robust cash flows. It has agrochemicals market. chemicals segments. The value chain completed most of its investments and skill requirements are quite during FY13-17 and currently has Despite this, PI industries’ CSM similar in pharma as in Agro. Hence, enough scope for volume growth. outperformed industry growth, which to leverage the expertise it has Going forward, the capex is likely to can be attributed to the company’s developed over decades across value be in the range of `200 crore to `250 unique business model and chain in research and manufacturing, crore, which would take care of its association with global companies PI Industries has diversified into current order book. It is net debt free from early start of product lifecycle. pharma as well as fine chemicals. and has healthy return ratios. Agrochemical cycle usually lasts for Pharma CSM market (~$20 billion) a period of 3 to 4 years. Hence, the is a much bigger opportunity than VALUATIONS industry is likely to recover in the agrochemicals CSM (~$6 billion). To coming years. fasten growth, the company is PI has a niche patent-led exports actively looking at inorganic options business in terms of CSM and We are already seeing signs of early to add further capabilities. in-licensed products from global green shots in the industry with innovators for the domestic markets. inventory levels coming down and Domestic Market: PII is one of the The cyclical global recovery along commodity prices expected to oldest and strongest players in the with inventory build-up across the rebound in 2HFY19, etc. Also, domestic market. It has a portfolio of value chain is likely to accelerate the disruption in product supplies from 35-40 niche products. PII has demand for agrochemicals both China has opened new doors of in-licensed off patented products globally and in the domestic markets. growth for Indian companies. from global innovator companies with whom it has a strong FY18 was a muted year for the Global players are keen to de-risk relationship. It has launched 5 new company due to various factors like their businesses by putting India as products in the domestic market and global slowdown, GST-related second source (and some places even is likely to launch similar products in supply disruptions, unfavourable as 1st). Going forward, we believe FY19 as well. monsoons, effects of demonetization PI’s CSM business is likely to gain etc. higher momentum owing to recovery In the last two years, it has some in the global agchem space. It has a strategic tie-ups with global majors However, we believe, PI would robust order book of $1.1-1.2 billion, like Kumiai (for making active bounce back much stronger and is which will be executed over the next ingredient of its biggest product – likely to post strong growth and 3-5 years. This provides revenue Nominee Gold), BASF, Mitsui improved margins, going forward. At visibility. Chemicals Agro Inc (MCAG). the current market price (CMP), the stock is trading at 23.1x on FY20E Diversifying Into Non-Agro Space: Strong Balance Sheet: The consensus earnings.

FINANCIALS

Year Net Sales Growth EBITDA Margin Adj.PAT Margin EPS PE EV/EBITDA RoE FY17A 2,277 8.6% 553.3 24.3% 459.4 20.2% 33.3 24.9 21.1 28.2% FY18A 2,277 0.0% 493.4 21.7% 367.6 16.1% 26.7 31.2 23.6 19.1% FY19E 2,789 22.5% 578.0 20.7% 410.5 14.7% 29.8 27.9 19.7 19.3% FY20E 3,278 17.5% 709.0 21.6% 505.9 15.4% 36.6 22.7 16.0 20.3% Source: Nirmal Bang Research, Company Data

19 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... ZENSAR TECHNOLOGIES Strategy An Inflection Point To Performance

Zensar Technologies is a digital solutions and technology services company. It was established in the year 1979 and is part of Dr RP Goenka Group, which focuses on enterprise digital transformation. When Mr Ganesh Natarajan became its CEO in 2001, he refurbished the company from IT hardware to a software services company.

Zensar offers various solutions and services, which comprise enterprise, analytics, intelligence and relationship management tools.

INVESTMENT RATIONALE infrastructure business, Zensar had There has been a visible pick up in three lines of business: product, large deal wins too. Change In Management: Mr maintenance and services. With the Sandeep Kishore, CEO, took over change in management and with TCV wins over 18 month stands at from Ganesh Natarajan with effect renewed focus, the management has $800 mn+. Higher TCV has been from January ’16 and changed planned to restructure its business. supported with visible pick-up in Zensar into a digital solutions and Management founded maintenance large deal wins. Over a period of 9 technology services company. Over and product business, which are months , the company has won 3 2.5 years, under the new leadership, low-margin business, to be non-core large deals. Two deals of $100 the company has undergone a lot of to its long-term growth strategy. As million+ deals from a Fortune 100 changes. such it has reduced its product Technology Brand & a Global business from $50 million in FY16 to Diversified Brand. $79 mn deal from (a) Zensar acquired FoolProof, $10 million in FY18. City of San Diego. Other than this, Keystone, Cynosure, Indigo slate, Order pipeline of the company stands which filled in the company’s Other than this, the management strong at $ 800 mn in Q2 FY19 vs $ capability and services portfolio gap plans to sell its maintenance part of 600 mn in Q1 FY19 Strong traction (b) Zensar invested in a platform and IMS business and ROW business in in order pipeline with improved win became 100% digital itself. This FY19. This will impact revenue by ratio in large deals indicates strong stands out to be the biggest around $41 million. However, ramp future growth difference in comparison with other up of large deals will offset the companies where Zensar has made impact on revenues. This business The operating margins of the itself digital-first and is now being lower margin at EBITDA company have started improving too. approaching the market. With this, level, selling of the business will lead In H1 FY19, its operating margin Zensar now has a portfolio of 34 to an uptick in margins in the future. came in at 12.8% as against 10.9% in digital platforms. In Q2 FY19, the H1 FY18, which we feel would company’s digital revenue was Improved Financials: Over further improve by selling 44.2% of the total revenue (c) FY15-18, dollar revenue had grown low-margin business and winning Changed US Sales team and added 7 at a slower pace, that is, at a CAGR larger deals. new hires at leadership level (d) of 3.9% including inorganic growth, Identified the non-core business, as the company was in the Other than this, since the company which is loss-making and doesn’t restructuring phase and was reducing has its own IP in digital products, match its growth strategy and its product business. Operating higher implementation will also reduced the revenue contribution margins had also reduced from improve margins. Higher from that business. 14.9% in FY16 to 11.7% in FY18. profitability will, in turn, improve the However, this restructuring has now ROE and ROCE of the company. Sell Off Of Non-Core Business: In started reflecting into deal wins. ROE and ROCE in FY18 stands at

20 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... 14% and 18%, respectively. and being digital itself, has bridged strategic investments and cross the gap in its service portfolio. selling to existing accounts. Higher VALUATIONS growth and sale of its non-core Some of the growth drivers for the business will improve the company’s Although over FY15-18, dollar future of the company are having margins in the future. At the current revenue had grown at a slower pace presence in the growing industry, market price (CMP), the share is of 3.9% CAGR including inorganic Next Gen Delivery Model, increased trading at 13.1x FY20E EPS and growth, the initiatives of acquisitions wallet share in digital spend, looks attractivE. FINANCIALS

Year Net Sales Growth EBITDA Margin PAT Margin Adj. EPS PE EV/EBITDA RoE FY17 3,055.6 3.5% 381.9 12.5% 234.9 7.7% 10.4 22.9 13.2 15.9% FY18 3,107.7 1.7% 364.9 11.7% 241.5 7.8% 10.7 22.3 13.8 14.4% FY19E 3,881.9 24.9% 515.0 13.3% 332.5 8.6% 14.8 16.0 9.6 18.6% FY20E 4,450.2 14.6% 635.1 14.3% 405.2 9.1% 18.0 13.1 7.5 19.7% Source: Nirmal Bang Research, Company Data

Get real-time news at your finger tips with the BEYOND App. For sharp and NEWS IN insightful news from across verticals like business, finance and stocks on the go, A FLASH download the BEYOND App and experience the difference anytime, anywhere. Download BEYOND App on

eyond Powered by

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

21 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

CHANGING LANDSCAPE The long-term outlook for the retail industry is positive, supported by rising incomes, favourable demographics, entry of foreign players, and increasing urbanization

22 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... Foreign Direct Investment (FDI) for the industry is positive, supported equity inflows totaling $1.42 billion by rising incomes, favourable between 2000 and 2018, according to demographics, entry of foreign the Department of Industrial Policies players, and increasing urbanization, and Promotion (DIPP). industry experts said.

Investments by private equity firms The main focus of retailers in 2019 and wealth firms in Indian retail will be innovative advances in sector reached $800 million in 2017 technology, coupled with seamless while India’s retail sector attracted in-store shopping experiences, are `9.5 billion ($147.40 million) among the top predictions for 2019’s investments in FY18, registering a global retail trends. growth rate of 35% year-on-year ndia’s retail market is expected to (y-o-y) from `7 billion ($104.34 “2019’s biggest trend of all is likely increase by 60% to reach $1.1 trillion million) in FY17. to be the continuation of rapid and by 2020, on the back of factors like radical change in the food and rising incomes and lifestyle changes GOVERNMENT INITIATIVES grocery industry. Shoppers’ Iby middle class and increased digital expectations have changed, and the connectivity. While the overall retail The government of India has taken retail and grocery sectors are market is expected to grow at 12% various initiatives to improve the working to meet those expectations per annum, modern trade would retail industry. It has allowed 100% in every area of business,” Harish expand twice as fast at 20% per FDI in online retail of goods and Bijoor, Chief Executive Officer and annum and traditional trade at 10%, services through the automatic route, Brand Expert, Harish Bijoor according to an Assocham report. thereby providing clarity on the Consults said adding data will be one existing businesses of e-commerce of the main building blocks of retail Online retail is expected to be at par companies operating in India. growth. 2018 has seen data become with physical stores in the next five more valuable to the retail sector years and India is expected to ROAD AHEAD than ever, Bijoor said. become the world’s fastest growing e-commerce market, driven by robust E-commerce is expanding steadily in Through customer datasets, artificial investment in the sector and rapid the country. Customers have the intelligence (AI) and machine increase in the number of Internet ever-increasing choice of products at learning in-store, retailers can target users. India’s e-commerce sales are the lowest rates. E-commerce is products and offers more effectively expected to reach $200 billion by probably creating the biggest whilst maintaining appropriate stock 2026 from $39 billion in 2017, the revolution in the retail industry, and levels and improving customer report said. this trend would continue in the years service. to come. Luxury market of India is expected Physical stores will offer a much to grow to $30 billion by the end of Retailers should leverage the digital more digital experience in 2019, by 2018 from $23.8 billion, supported retail channels (e-commerce), which using technology to make it easier by growing exposure to international would enable them to spend less for customers to find items and gain brands amongst Indian youth and money on real estate while reaching more product information. higher purchasing power of the upper out to more customers in tier-II and class in tier-II and -III cities, tier-III cities. Retailers will play a more active role according to the report. in supporting the health and wellness Both organized and unorganized of consumers. It is expected that new The size of modern retail in India is retail companies have to work innovative social commerce expected to reach $11.25 billion in together to ensure better prospects solutions will emerge throughout 2019 from $13.51 billion. for the overall retail industry, while 2019. Retailers and suppliers will generating new benefits for their deliver targeted marketing and new INVESTMENT SCENARIO customers. ways to make online shopping more social, instantaneous, and The Indian retail trading has received Nevertheless, the long-term outlook convenient.

23 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... The growth of the sector is likely to ONLINE RETAIL BOOM IN 2018 that will see new malls opening in drive demand of retail estate. 2019 include Chandigarh, Dehradun, Meanwhile, online retail also Lucknow, Ranchi, Rourkela, Solapur, Anuj Kejriwal, Managing Director witnessed exponential growth in Udaipur and Vizag. and Chief Executive Officer, 2018. In fact, as per estimates, Anarock Retail said, besides e-commerce is expected to grow at Several factors are working in favour commercial office spaces, the retail par with physical retail over the next of tier-II and -III cities. While the sector also emerged as one of the 5 years, considering that e-commerce metros face mounting challenges in most vibrant and fast-paced real grew by as much as 23% to reach the form of overall saturation due to estate sectors in India in 2018. $17.8 billion in 2017. India is poised lack of space, increasing rental to become the world’s values and escalating infrastructure Among the major policy overhauls, fastest-growing e-commerce market, woes, smaller cities have been the government further liberalized driven by robust investment in the witnessing multiple infrastructure FDI policies early in the year. These sector and rapid increase in the upgrades even as technological policy interventions repositioned the number of Internet users in the enhancements help create more Indian retail sector on the global map country. awareness about brands, products of investments, attracting a large and markets there. number of global retailers into India Another interesting trend witnessed further fueling the growth of in 2018 was that besides the top In fact, the contemporary Indian organized retail in the country. metros, tier-II and -III cities also shopper in tier-II and tier-III cities is contributed a significant part of the more demanding and aware and has The government’s decision to allow entire retail growth momentum. higher disposable income than ever 51% FDI in multi-brand retail and Tier-II and tier-III cities that before. A large segment of tier-II and 100% FDI in single-brand retail continued to flourish in 2018 tier-III city customers are under the automatic route was for included Ahmedabad, globetrotters and this has attracting giants like Walmart to Bhubaneshwar, Chandigarh, necessitated a revolutionary change make forays into the country. Coimbatore, Indore, Jaipur, in the way the retail sector must Lucknow, Kochi, Nagpur, adapt to tap into their demand. The government is now mulling over Thiruvananthapuram and Vadodara. tweaking norms further for retail One of the radical shifts in the trade – similar to SEZs – and Realizing the potential of these consumption pattern of new-age enacting a 365-days working policy largely untapped markets, both consumers in smaller towns is that to help India climb higher on the domestic and international brands these shoppers are moving beyond Ease of Doing Business index among have started penetrating these regions the basics and seek to buy products 190 countries. via rapid online presence, followed available in larger urban areas. by a gradual offline presence. Therein lies a massive opportunity The retail sector is now projected to for retailers. Nearly 100 million grow from $672 billion in 2017 to The fact that 35% of luxury shopping people out of the 300 million - 400 $1.3 trillion in 2020. Experts said sales come from tier-II and tier-III million-strong Indian middle-class that this is definitely an attainable cities alone is urging top brands to currently resides in smaller towns figure if we consider one of the explore these markets. Also, the lack and cities. clearest measures of growth - namely of sufficient physical retail the increasing focus on the retail infrastructure in these cities is giving TOP-PERFORMING REGIONS sector by private equity (PE) players the e-tailing business an advantage - IN 2018 who invested close to $300 million in nearly 50% to 60% sales of Indian retail in the first half of the e-commerce companies are generated As per Anarock data, the cities that year 2018. from Indian tier-II and tier-III cities contributed most generously to the alone. Indian retail growth story in 2018 The total PE investment inflow in the included MMR, NCR, Bengaluru and segment grew 54% in H1 2018 as Out of the total new supply Kolkata. Besides the top metros, compared to H1 2017, while the becoming operational in 2019, nearly tier-II and -III cities like y-o-y share also grew to 9% (H1 3 million sq ft area will be coming up Bhubaneshwar in the eastern region, 2018) from 2% (H1 2017). in tier-II and -III cities. The cities Vizag, Lucknow and Gorakhpur were

24 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... other contributors to the Indian retail consumption expenditure in India is 2019 to provide unique appeal along activity. Each of these cities was projected to rise to $3,600 billion by with more depth in shopping expected to have one major mall of 2020. experience. areas ranging between 60,000 sq ft and 3.50,000 sq ft operational by end 2019 - GREAT Any new mall ventures in 2019 that of year 2018. EXPECTATIONS… are designed to succeed will focus on prime locations that are easily Going by the current trends and As per Anarock data, as many as 32 accessible by both public and private future predictions, the major metros new malls spanning nearly 13.5 transport. that will outshine the rest in 2019 million sq ft area are slated to be will be NCR, MMR, Bengaluru, operational in 2019 across major The key for retailers to remain Kolkata, Ahmedabad and Lucknow cities and several tier-II and -III successful in 2019 will be to be as far as brand expansion and new cities. present in the right locations, offer mall supply is concerned. the right product and become Among the major metros, both unrelentingly customer-centric. Following the underlying demand for Bengaluru and NCR are expected to both national and international see 7 operational malls in each city, Similarly, developers need to build brands in most of these cities, retail followed by 5 in Hyderabad, 3 in their malls in not just the right activity is likely to see a major MMR and 1 in Chennai. location but also have the right mix increase. In order to stay relevant, of brands, and provide a holistic brands will take both the online and Besides being mixed-use businesses shopping and entertainment offline route to reach out to larger that incorporate social entertainment experience to ensure returning audiences given the fact that total options, malls will strive harder in customers in sufficient numberS.

ƌĞĞǌĞĞīŽƌƚůĞƐƐůǇƚŚƌŽƵŐŚƚŚĞ ŵĂǌĞŽĨĮŶĂŶĐĞǁŝƚŚƚŚĞŽŶůŝŶĞ ƚƌĂĚŝŶŐĂƉƉʹĞǇŽŶĚ͘EŽǁ͕ŵĂŬĞ ŝŶĨŽƌŵĞĚĮŶĂŶĐŝĂůĚĞĐŝƐŝŽŶƐďǇ It’s Simplified ƐŝŵƉůǇĚŽǁŶůŽĂĚŝŶŐƚŚĞĞǇŽŶĚ ƉƉĂŶĚĞǆƉĞƌŝĞŶĐĞƚŚĞũŽǇŽĨ ƚƌĂĚŝŶŐĂŶǇƟŵĞ͕ĂŶǇǁŚĞƌĞ͘

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

25 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

The automotive lighting segment is showing great promise and is expected to do well in the near future LIGHTING UP THE FUTURE

26 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... develop differentiated and especially in countries from energy-efficient products such as European and Southeast Asian light-emitting diodes (LED) lights, markets. This is precisely the reason rear lamps and headlamps, among why globally the share of LED is others. expected to move up from about 20% currently to about 40% over the next Like many other auto ancillary five years. products and companies, automotive lighting is a global industry and According to international market domestic companies are today not research company Yole, the revenue only serving the domestic market but of global automotive exterior lighting also exporting to many large OEMs grew at 4.5% annually during the or automobile majors in the world. year 2011-2016. It expects this volution of the automobile industry market to grow at 4.3% annually from conventional to cutting-edge A GLOBAL MARKET during the year 2016-2021. This technologies like the electric vehicle growth is higher than the global has constantly challenged With the help of R&D and new passenger vehicle and light Edownstream suppliers such as auto technologies, domestic players have commercial vehicle sales growth ancillary companies. Among them, established themselves in the global because of the increased penetration automotive lighting has emerged as market. Companies such as Varroc rate of LED that will raise the value most promising and investors are Engineering, which is the leading of lighting systems compared to riding on the trend. player in the global markets, caters to incumbent technologies. companies like Ford, JLR, Leading players like Lumax Volkswagen, Renault-Nissan, and an This would further increase lighting Industries, which covers about 35% EV of Tesla. Along with Indian value and lighting content per car, of the market shares domestically, clientele like Bajaj Auto, Honda, thus creating new opportunities for has seen close to four-fold jump in its Royal Enfield, Yamaha and M&M. companies in this segment. As per share prices from about `440 a share market estimates, auto lighting in January ’16 to `1,700 a share On the global front, automotive content per vehicle would increase currently. Similarly, other listed lighting generates more than $17.8 from $250 in the year 2015 to $301 players such as Varroc Engineering billion in revenues on an yearly per vehicle in the year 2020. and Fiem Industries are attracting basis. And Indian companies export investor interest. about 2.3 million units annually with DOMESTIC OPPORTUNITIES volumes growing at 15% annually as LIGHTING UP a result of increasing competitiveness While the global automotive lighting of the Indian products in terms of industry has grown at about 4% to From luxurious cars to bikes, all technology, cost and design. 5% in the last five years, the automotive vehicles showcase different style and lights. Automotive The recently-listed company, Varroc Product-Wise Market Share In The Domestic Market lighting has moved up the value Engineering generates close to 65% chain from a mere item of luxury to of its revenue from international an important item that improves the markets. It has about 185 patents and 10% overall look of the vehicle. Once over 1,500 engineers focusing on considered to be an inexpensive part new product design and technologies of the overall cost of the vehicle, including advanced exterior 22% Head Lights today it could bear a huge cost. lightings, polymer and electrical Rear Lights components for prominent Automotive lighting, which includes companies like Tesla, Chrysler and Others lighting products to increase vehicle Peugeot. 68% visibility in the darkness, is riding on new technologies where most of Globally, the growing prominence of these companies focus and spend electric vehicles (EVs) is a big huge sums of money on R&D to growth driver for exterior lightings Source: Industry Data

27 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... domestic market has been growing at Auto Lighting Content Per Vehicle constantly improved their margins a faster pace. Industry body Society from 6.9% in FY14 to 8.8% in the of Indian Automobile Manufacturers Year Amount (In $) year FY18. Improvement in margins (SIAM) outlines factors such as 2005 191 would also help these companies increasing LED penetration, 2010 225 improve their return ratios. Among technological innovation, design 2015 250 companies, Lumex Industries make differentiation, and increased lighting 2020 301 the highest return on equity at 21% content per vehicle, which have been Source: Varroc Engineering followed by 18% return on equity contributing to its growth. from the two-wheeler segment. It generated by Varroc. caters to clients like TVS, Indian Moreover, the end user is far more Railways, Ministry of Shipping and Importantly, this is the demanding with changing standards others. It has a long-established track fastest-growing segment, which and OEMs looking for energy- record being the first one to supply would be key to the growth of these efficient products ahead of the LED lamps in a two-wheeler companies. To put it in perspective, introduction of BS IV norms by 2020 segment in India. LED-based products used to account to induce high usage of energy- for about 3-5 of the overall efficient lights. Lighting is a very The two-wheeler LED market is at a automotive lighting market in the specialized product and most nascent stage and is picking up quite financial year 2016, which increased companies work along with OEMs, quickly with new models coming up to about 10% to 12% in the year thus enjoying high entry barrier and with LED lighting, particularly 2017. Further, it is expected to grow business predictability. scooters. Honda Motorcycles and at a faster pace at about 20% TVS Motors, which are two leading annually over the next 5 years. Lumax Industries is the largest player companies in scooters account for in the domestic market, serving 70% of Fiem’s revenue. The Increasing usage of LED in addition clients such as Maruti, representing proportion of two-wheeler models to volume growth because of higher 34% of its revenue, followed by embedded with LED lighting was lighting per vehicle would add to Hondo Motors, Hero Moto Corp, about 3% in the year 2013, which natural growth. This would be in Scooters India, etc. Lumax Industries increased to 7% in the year 2017. addition to the growth of the has presence across the value chain automobile industry, including and caters to most segments such as LED-based lighting is at least about two-wheelers, passenger vehicles and four-wheelers and two-wheelers. 4 times more costly than commercial vehicles, which is conventional lighting. Companies are expected to grow in the range of 9% Unlike Lumax, which generated hoping that with the increasing to 13% over the next three to four close to 70% of its sales from the proportion of these value-added years. Growth would be driven by four-wheeler segment, the second products, they should be able to higher economic growth, increase in largest player Fiem Industries make higher operating margins. incomes, lower crude oil prices and generates close to 90% of its revenue Companies like Varroc have other factorS. BEYOND WORDS

LEVERAGED BUY-OUT

Buying a company using borrowed money to pay most of the purchase price. The debt is secured against the assets of the company being acquired. The interest will be paid out of the company’s future cashflow. Leveraged buy-outs (LBOs) became popular in the United States during the 1980s, as public debt markets grew rapidly and opened up to borrowers that would not previously have been able to raise loans worth millions of dollars to pursue what was often an unwilling target.

Although some LBOs ended up with the borrower going bust, in most cases the need to meet demanding interest bills drove the new managers to run the firm more efficiently than their predecessors. For this reason, some economists see LBOs as a way of tackling agency costs associated with corporate governance.

28 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

times in the auto sector seems to automobile production increased have been disrupted and auto sales 16.69% y-o-y to reach 10.88 million have been falling. So, what exactly vehicle units. has been the reason for this? Here is a low-down on this: Overall domestic automobile’s sales increased at 7.01% CAGR between A KEY SECTOR FY13-18 with 24.97 million vehicles getting sold in FY18. Auto sales in India’s auto industry has been the July ’18 witnessed a y-o-y growth fourth largest in the world with sales rate of 7.9% across segments, driven increasing 9.5% year-on-year (y-o-y) by 46.24% growth in three-wheeler to 4.02 million units (excluding two sales in terms of percentage. wheelers) in 2017. It has been also ndia’s automobile sector has been the seventh largest manufacturer of Premium motorbike sales in India one of the few key sectors, which commercial vehicles in 2017. crossed one million units in FY18. turned out to be a beacon of hope for Two leading luxury car investors in the past three years. This In terms of market size, India’s manufacturers, BMW and Iis more striking when one compares domestic automobile production Mercedes-Benz, recorded their with the underperformance of key grew at compound annual growth best-ever half yearly sales in India sectors such as real estate and sectors rate (CAGR) of 7.08% between during January-June ’18. Sales of associated with it. FY13-18 with 29.07 million vehicles BMW grew 13% y-o-y to 5,171 units manufactured in the country in and sales of Mercedes-Benz grew However, in recent months, the good FY18. During April-July ’18, 12.4% y-o-y to 7,171 units.

HEADING The crisis in the NBFC sector TOWARDS is hurting auto sales in India A BREAKDOWN

29 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... The two-wheeler segment dominates in October. Two-wheeler companies are likely to the market in terms of volumes be the most susceptible of NBFC owing to a growing middle class and Tata Motors’ management stress as a large share of incremental a young population. commented that overall November volume growth witnessed in the past was a challenging month for the PV five years primarily funded by NBFC Moreover, the growing interest of industry with muted consumer that boosted finance penetration, companies in exploring the rural sentiment caused by liquidity crunch, followed by passenger car, tractor markets further aided the growth of non-availability of retail finance and and commercial vehicle. the sector. India is also a prominent a moderate festive season. auto exporter and has strong export The lesser participation by NBFC growth expectations for the near • Truck during the festive season - accounts future. for 10% to 15% of annual sales - Medium and heavy commercial could remain an overhang on the Automobile exports grew 26.56% vehicle (MHCV) sales were weak in stock and price-earnings could shrink during April-July ’18. It is expected November across Original further. Auto stocks have corrected to grow at a CAGR of 3.05% during Equipment Manufacturers (OEMs). 12% to 56% since the beginning of 2016-2026. In addition, several Tata Motors reported 24% y-o-y the year and barring TVS Motor, initiatives by the government and decline in MHCV sales versus 16% price-to-earnings multiple of all major automobile players in the growth in October and Eicher Motors major companies have fallen below Indian market are expected to make reported 4% y-o-y decline in their long-term average. India a leader in the two-wheeler and November versus 10% growth in four-wheeler market in the world by October. According to a Credit Suisse 2020. Sales of electric two-wheelers analysis, finance penetration in are estimated to have crossed 55,000 • Two-wheelers two-wheeler companies rose 50% in vehicles in 2017-18. FY18 compared with 30% in FY14. Hero Motocorp and Eicher have On the other hand, finance DECLINING SALES reported falling sales of penetration in the passenger car, two-wheelers in November. Hero tractor and commercial vehicle In recent months, however, auto sales reported 1% y-o-y growth in sales segment in the same period grew up have been falling. The data for sales versus a stupendous 16% growth in to 5%. in November itself speaks volumes October. Eicher Motors’s sales fell about the state of affairs in India’s by 6% on a y-o-y basis in November. The prime driver for the increase in auto sector. Here are the sales figures the finance penetration in two- in each key category of the industry: THE ROAD AHEAD wheelers has been the aggressive growth of NBFCs to fund • Passenger Vehicle (PV) One of the contributing factors, two-wheelers. The share of NBFCs which augmented auto sales over the (along with the captive NBFC arm of Maruti’s domestic sales in November years has been the availability of two-wheeler companies) rose to 60% remained flat on a y-o-y basis at 2%. auto financing especially from in the last fiscal year, a gain of nearly Sales were weakest in the entry-level Non-banking Finance Companies 8% in five years. NBFCs increased segment as Wagon R sales slowed (NBFC). their exposure in two-wheelers as the down ahead of a full model change. ticket size was small in denomination In the year-to-date (YTD) period in However, the growing stress among and tenure was less than 24 months. FY19, Maruti’s domestic sales are up the non-financial finance companies 9% on a y-o-y basis versus the (NBFC) to raise funds through Consequently, a large part of company’s guidance of 10% growth money market instruments could incremental sales of two-wheelers in FY19. moderate volume growth of auto were sold through financing. companies in the current fiscal year. Interestingly, penetration in Mahindra & Mahindra’s Utility passenger vehicles stood at 81%. Vehicle sales continued to be down The volume growth of major listed on a y-o-y basis. Tata reported PV auto companies is expected to be However, NBFCs have just 17% sales were down 1% y-o-y in double-digit in FY19 and the first share in the car segment. In the November as against up 11% y-o-y half maintain projected trajectory. tractor segment, NBFCs have a high

30 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... exposure. But it comes under priority the most vulnerable by NBFC stress their volume guidance, the loan is no lending. Therefore, it is easily sold to could be Eicher Motors at it has high longer cheap for the captive arm. banks. finance penetration with no captive financing arm. Hero Fincorp raised `670 crore in In the coming quarters, analysts point April ’18 through the commercial out that the sustainability of the Hero’s management in the post- paper at a yield to maturity of 6.91%, current momentum of the September quarter conference call while in two tranches of `350 crore two-wheelers’ volume growth informed that Hero Fincorp accounts in September ’18 raised at 9.25%, depends upon how their captive for nearly 11% of the total volume of according to research and data firm financing arm would be able to make the company and maintains that they Prime Database. up for the fall in financing by NBFC are on course to achieve 8% to 10% in the near- to medium-term. volume growth for the current fiscal Similarly, TVS Credit Services - year too. 85% owned by TVS Motor - raised Hero MotoCorp, Bajaj Auto, and yield-to-maturity (YTM) of 7.19% in TVS Motor have their captive Although Hero may be betting on April ’18, while in September ’18 it finance arm. Among two-wheelers, efforts of the captive arm to support was 8.24% for raising `100 crorE. ;174)1#.5 174':2'46+5'

ere is no shortcut to reach your nancial goals. But there is always a proper path. We help simplify the path for you through in-depth research backed by decades of valuable experience in the industry.

eyond Powered by

7 Disclaimer: Insurance is a subject matter of solicitation. Mutual Fund investments are subject to market risks. Investment in Securities/Commodities market are subject to market risks. Read all the related documents carefully before investing. Please read the Do’s and Don’ts prescribed by the Commodity Exchange before trading. We do not offer PMS Service for the Commodity segment .The securities quoted are exemplary and are not recommendatory. NIRMAL BANG SECURITIES PVT LTD – BSE (Member ID- 498): INB011072759, INF011072759, Exchange Registered Member in CDS; NSE MEMEBR ID- 09391): INB230939139, INF230939139, INE230939139; MSEI Member ID-1067) : INB260939138, INF260939138, INE260939139: Single Registration No.INZ000202536,PMS Registration No: INP000002981; Research Analyst Registration No: INH000001766; NSDL/ CDSL: IN-DP-CDSL 37-99. NIRMAL BANG COMMODITIES PVT LTD – MCX (Member ID -16590 /NCDEX Member ID -0362 /ICEX Member ID -1165) : Single Registration No. INZ000043630; NCDEX Spot: 10084; Comtrack Participants: CPID -5040; CDSL Commodity Repository Ltd: 12013300 Nirmal Bang Securities Private Limited CIN: U99999MH1997PTC110659; Nirmal Bang Commodities Private Limited CIN: U67120MH1995PTC093213

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

31 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND THINKING

JOBS Job losses is an inevitable truth and IN people must adapt themselves to PERIL changing times

32 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... likely to decrease by 3% to 92% in evolving rapidly. The growth of the two quarters (October ’18 – e-commerce, retail and March ’19) when compared to 95% technology-based sectors has led to during the April– September ’18 new sources of informal period. employment.

The Teamlease Employment Outlook According to an Ernst and Young report surveyed 750 employers and report, the future of jobs in 2022 in 2,500 employees of small, medium India will be determined by the and large companies across 19 country’s response to the “inevitable sectors and 14 cities. Eight out of 19 impact created by the interplay of sectors surveyed reported an increase three primary forces - globalization, in the net employment outlook, seven demographic changes and the ndia has an unemployment problem sectors reported a drop in their adoption of exponential technologies and not many are talking about it. It outlook and one sector reported no by Indian industries.” will need to add 10 crore people into change. the working age population by 2027, The impact of these three forces is Iwhich is about five times the In fact, India’s net employment expected to be disruptive on sectors population of Australia (2.4 crore), outlook has shown a steady decline such as IT-BPM and BFSI and according to a study by over the years. The net employment relatively lower on core PricewaterhouseCoopers (PwC). outlook in 2017 was 18%, according manufacturing sectors such as to a Manpower Group survey, apparel and leather. According to the PwC report, India compared to 40% in 2005, showing a will have to generate 100 million decline of almost 20%. According to the report, by 2022, 9% jobs in the next seven years and of the country’s 600 million almost all of these jobs would have There are a couple of reasons for the estimated workforce would be to be generated in ten states of Uttar low job growth rate - one is that the deployed in new jobs that do not Pradesh, Madhya Pradesh, economy is generating less jobs per even exist today, 37% would be in Chhattisgarh, Rajasthan, Jharkhand, unit of GDP and the other is that a lot jobs that have radically changed skill Maharashtra, Odisha, West Bengal, of jobs that are being created are of sets and jobs of 21% of workforce in Bihar and Assam. poor quality. The manufacturing 2017 faces “existential threat”. sector is not generating as many jobs The problem is that hiring in India’s as it should be. The slowdown that India is seeing in formal job market has remained job creation is on expected lines and stagnant though the Indian economy While some experts believe that the this will continue for the next two has been growing at a faster rate. services sector alone can generate years as companies restructure their India’s Gross Domestic Product employment, others argue that the business models. (GDP) growth has grown every manufacturing sector will have to quarter at over 8%. Job growth is, step up. The manufacturing sector The adoption of technologies is however, not happening. especially labour-intensive transforming unorganized sectors, manufacturing can make a sizable such as transportation, food catering, An indication of how bad the job contribution to the job market. and software development services, market is the fact that when the into organized ones. government announced 90,000 Agriculture which employs almost vacancies in the Indian Railways in half of the workforce cannot be This will create new forms of March this year, almost 28 million ignored either. Agriculture sector employment such as contract people applied for it. The job market will, however, have to be ably employees in the infrastructure is not expected to get any better. This supported by the manufacturing sector, micro-entrepreneurs, means that by 2019, India will have sector. employer-entrepreneurs in 18.9 million unemployed people! technology-enabled models (like The slowdown in job creation also freelancers, SME artisans, delivery According to a Teamlease report, needs to be seen in the context of the workers, employees in start-ups) and India’s net employment outlook is fact that the Indian job market is employer-entrepreneur models in the

33 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... agriculture sector. The new forms of focus of industries should be on cannot be emulated. The education employment are expected to increase skilling and reskilling employees. sector in India needs to rethink what the share of the organized sector in it is teaching. It is not enough to have the overall economy to 10% from 8% Sectors such as BFSI, automotive technical knowledge. at present, around 60 million in a and textiles, which have adopted new workforce of 600 million. technologies, have started reskilling The future workforce will have to be their workers. The government will adept at interpersonal skills, conflict The biggest problem that India faces also have to take initiatives to skill management, people management, today in the context of the rising and reskill workers to make them etc. This will decide the adoption of technology and its more employable. employability of job seekers. impact on the job market is the absence of skilled workforce. Rapidly changing technologies The future workforce will have to means that many of the jobs that learn to work in a geographically Over 65% of the workforce in India exist today will be done by machines dispersed virtual environment, which is less than high-school pass and and new jobs, which will require new according to the PwC study, will 50% have primary school or less skill sets will be created. soon replace the current workplace education. environment. PwC projects this style According to McKinsey Global of working to increase by 50% by the Furthermore, almost half of the Institute, around one-third of all jobs year 2020. Indian workforce is unemployable. across 46 nations would be displaced An employability solutions company by 2030. The McKinsey report Change is disruptive but change can noted that around 47% of Indian estimates that automation could force also be good. This is a good graduates are unemployable. anywhere between 75 million and opportunity for industries to skill and 375 million into new jobs by the year reskill the current and future According to a McKinsey report, 2030. workforce. only a quarter of Indian engineers are employable. Some other studies state The changing nature of the job The government can support that the figure is as low as 5%. market requires the industry, the corporates in this initiative. It should education sector and the government also support labour intensive New skill sets will be required with to take proactive measures to create a industries such as agriculture and the introduction of artificial futrure-ready workforce. Today, manufacturing to drive job creation. intelligence, big data, block chain employability has a new meaning. and cloud computing. This is lacking Academia and the education sector among the current workforce. While artificial intelligence and other should rethink the way they have technologies can get the work done been teaching and introduce tailored Robotics are transforming the more efficiently than humans and at courses to meet the needs of future working of many sectors and the half their cost, soft human skills workforcE. BEYOND WORDS

PHILLIPS CURVE

The Phillips curve is a single-equation econometric model, named after William Phillips, describing a historical inverse relationship between rates of unemployment and corresponding rates of rises in wages that result within an economy. Stated simply, decreased unemployment in an economy will correlate with higher rates of wage rises. Phillips did not himself state there was any relationship between employment and inflation, this notion was a trivial deduction from his statistical findings. Samuelson and Solow made the connection explicit and subsequently Milton Friedman from 1967 put the theoretical structure in place. In so doing, Friedman was to successfully predict the imminent collapse of Phillip's a-theoretic correlation. While there is a short run tradeoff between unemployment and inflation, it has not been observed in the long run.

34 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND BASICS

mimic portfolios of legendary made on their investments in the investors. Typically, Indians wait for respective funds. ‘stock picks’ from top investors. There are others who eagerly wait for However, in this article, we will stock selections by fund managers. focus on top three small-cap and mid-cap schemes that have given There are hundreds of equity best returns in the last three years schemes in the market, which are and we have looked into their managed by different fund managers. portfolios. We have tried to look at These can be divided into different schemes’ portfolios and the stocks categories like large-cap, mid-cap, they have invested in as on small-cap, multi-cap, and top funds November ’18. This is not a ‘buy keep changing over the period, call.’ But we have tried to ascertain n the last few months there has been making it difficult to mimic fund which stocks and sectors are being intense volatility in the Indian equity managers’ investment styles. preferred by fund managers in the markets due to both international and current scenario. domestic factors. With general Fund managers invest across Ielections coming up in the next few schemes with differing objectives, AXIS MIDCAP FUND months and geopolitical uncertainty, which may not necessarily suit investors should brace for more investors’ investment needs. We will This is one fund, which was volatility in the equity markets. not even know when they entered the launched in the year 2011 and has stocks and when they exited them since given returns of 17.31%. It has Investors, both global and Indian, and how much profit or loss they managed to beat its benchmark every

Despite volatility in the markets, few RISING mutual funds from the small-cap and mid-cap space have given better TO THE returns over the past few years OCCASION

35 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... year and has been a top-ranking fund exposure to sectors like consumer Setalvad and top sectoral holding is in the mid-cap fund category. If we non-durables, auto ancillaries and in industrial products, software and look at the portfolio of the fund, we finance companies. In the last five banks. Even in this scheme the fund find that it has around 45% to 50% of and ten years, the fund has given manager is sitting around 15% on exposure to financial services, returns of 25.5% and 23.30%, cash. consumer goods and industrial respectively. Investors seeking steady manufacturing. In terms of stocks, returns with little less volatility can According to the November top holdings of this fund include City look at this fund. factsheet, highest holding is in Union Bank at 5.29% and Gruh Aurobindo Pharma Ltd at 4.33% and Finance Ltd at 5.10%. DSP MIDCAP FUND NIIT Technologies Ltd at 3.62%.

As per the November factsheet, the This scheme was earlier named as While other top stocks are Chambal fund is sitting on debt, cash and other DSPBR Small and Midcap schemes, Fertilizers & Chemicals Ltd at 3.37% current assets at 16.91%. This but in the recent re-classification it and Sharda Cropchem Ltd at 2.84%. clearly shows that the fund manager has been named as DSP Midcap The scheme seeks to provide is not comfortable with valuations in Fund. Despite the change in name long-term capital appreciation the mid-cap segment and is waiting and investment objective, the fund /income by investing predominantly to enter the market when stocks or continues to deliver stronger returns. in small-cap companies and markets witness a correction. It has given returns of 23.20% in the around 71% of the money is invested last ten years, and 13.11% returns in in small-cap stocks, 9.24% in This mutual fund scheme has also the last three years. mid-cap stocks and 4.33% in invested in stocks such as Astral Poly large-cap stocks. Technik Ltd, Page Industries Ltd and With assets under management of HDFC Bank Ltd, among other over `5,000 crore, the fund is SBI SMALL CAP FUND companies. The fund has low investing in sectors such as banks, exposure to sectors such as energy pharmaceuticals and industrial SBI Small Cap Fund is one of the and construction. products. Like the other two funds, few funds in the small- and mid-cap even this fund is well-diversified category, which does not bet as L&T MIDCAP FUND across stocks and is not taking any aggressively as others. Moreover, its aggrieve stock or sector bet. portfolio is slightly concentrated and Although the fund has slipped in not diversified. Its portfolio is made terms of returns in the last one year, It has over 3% exposure in RBL up of HDFC Bank at 5.15% and JK the long-term performance of this Bank and City Union Bank, while in Cements at 4.39%. Other top fund makes it a promising the pharma sector its top holding is holdings in this fund include Blue investment avenue. Since its launch in IPCA Laboratories Ltd and Divis Star Ltd, Hatsun Agro Products Ltd in 2004, it has given returns of Laboratories Ltd with 2.94% and and Indostar Capital Finance Ltd. around 20% and is one of the funds, 2.92%, respectively as on November which has given strong returns from ’18. Even finance stocks such as In the last five years, the fund has a long-term perspective. Manappuram Finance Ltd and Max given returns of 31% as against its Financial Services Ltd have Nifty Small Cap 250 TRI of 18.93% Even this fund has been diversified exposures to this portfolio. for the same time frame. The scheme across sectors and is betting on few seeks to provide investors with stocks to deliver returns. It has high HDFC SMALLCAP FUND opportunities for long-term growth in exposure to sectors like industrial capital along with liquidity of products, cements, pharmaceuticals The fund has given returns of -2.55% open-ended scheme by investing and banks. in the last one year as -24.29% of predominantly in a well-diversified Nifty Smallcap 100 TRI, which is its basket of equity stocks of small-cap In terms of top holdings the fund has benchmark. It shows how well- companies. invested in Cummins India at 2.2%, crafted the stocks selection has been. ACC Ltd at 2.16%, RBL Bank at Many of the schemes in the Since its inception in 2009, the fund 2.47% and Cholamandalam small-cap category have given huge has given returns of around 19% and Investment and Finance Company negative returns in the last one year. investors who wish to take a slightly Ltd at 2.32%. The fund also has The fund is managed by Chirag aggressive bet can look at this mutual

36 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... fund for the purpose of investment. available at a reasonable price. portfolios or stocks of fund managers, it is advisable to look at RELIANCE SMALL CAP FUND The fund does not lean much towards funds that come with a track record growth or value style of investing. and have a good history. It is true In terms of assets this is one of the However, it has managed to that past performance does not biggest funds in the small-cap space outperform the benchmark over a guarantee future returns, but it and has been giving returns of period of time. It should also be a remains an important indicator when 14.35% over the last three years. It part of the portfolio of investors. selecting a fund. is well- diversified across sectors and has a high exposure to engineering, This fund has 75% exposure to As the small and mid-cap schemes chemicals and fast-moving consumer small-cap stocks, 19% to mid-cap segment is prone to high volatility, goods (FMCG). stocks and around 6% to large stocks must be chosen carefully. companies. However, for small-cap Top holding of the fund includes investing, investors need to stay for a If investors do not wish to go Vindhya Telelinks, VIP Industries, longer duration. through the pain of analyzing the Deepak Nitrate, Navin Fluorine company and investing in it, they International and Zydus Wellness. IN A NUTSHELL should invest in mutual funds This fund looks at investing in stocks through systematic investment plans that have solid businesses and are Even if investors want to mimic (SIPs) with a long-term horizoN.

Is Your Dealer Keeping Become Your Call On Hold? Your Own Dealer

Simply Download The Beyond App

eyond Powered by

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

37 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND BASICS

plan for his or her post-retirement options available for investors to life. choose from. They can go in for mutual funds, post office savings or It is essential to have enough savings pension plans offered by insurance post your retirement in order to companies. There used to be a few sustain your lifestyle the way you’ve drawbacks in pension plans offered always been living. Hence, a pension by insurance companies. However, plan plays a very important role in the new draft guidelines proposed by your financial planning. A pension the Insurance Regulatory and plan helps policyholders to plan for Development Authority of India their retirement. (IRDAI) have tried to offer some relief to insurers. It is best that one invests in a pension arly retirement has become quite plan early on in their working life, In India, pension plans have mainly common among people these days. which will allow them to optimize two phases - one is accumulation And it goes without saying that no annual savings at later stage of their phase, and the other is vesting phase. matter when you retire - early or later life. But before one takes a leap and In accumulation phase, the investor Eat the age of 60 - savings are highly invests in a pension plan they think is will pay annual premiums until they important. Given how important best for them, it would be ideal to reach the retirement age. Once the savings are for an individual, he or look at the benefits offered by investor reaches the retirement age, she must choose the right pension pension plans. There are multiple the vesting phase begins. During the

Pension plans are great for those seeking financial independence after retirement TOWARDS FINANCIAL INDEPENDENCE

38 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... vesting phase, the retiree will be `74,300 every year for life. But if the a hindrance. But in the draft slowly distributed his retirement holder chooses immediate annuities proposal, 60% of the money, which corpus as annuities. These annuities with period of 20 years and life the holders can withdraw, might be will be paid to the investor until his thereafter, he will get an annuity of tax-exempt as is not the case now. death or the death of the nominee. `72,900 per annum. This is a good Overall new changes proposed by the plan for holders who want to park regulator are policyholder-friendly In this article we would try and some excess cash and get stream of and might revive pension plans in explain pension plans offered by income for the rest of his/ her life. India, going forward. insurers, what investors should do and its impact on the overall CHANGES BY THE WHAT SHOULD INVESTOR DO financial portfolio on an investor. REGULATOR FOR PENSION PLANS Policyholders who are conservative PLAN LAUNCHED BY LIC and do not want to take much risk Recently, IRDAI came out with new can look at pension plans offered by Although pension plans have not draft regulations, which will make insurers, specifically unit-linked picked up in a big way in India since pension plans offered by life pension plans as returns are the past few years, Life Insurance insurance companies more attractive. guaranteed. However, guaranteed Corporation of India (LIC) has The draft documents have given returns will lead to some of the costs recently launched LIC Jeevan Shanti, similar treatment to unit-linked increasing and also restrict returns . a new single premium guaranteed pension plans as offered by National Not only do insurance companies pension plan. This plan offers Pension Scheme (NPS). have to guarantee death benefit but guaranteed pension with options like also the maturity amount on the immediate or deferred pension. Currently, early withdrawals are retirement age or vesting age. On discouraged as the purpose of vesting age, the policyholder is LIC also has a plan called Jeevan investing for a longer period of time assured of an ‘Assured Benefit’, Akshay VI, which is a guaranteed gets defeated. But policyholders are which is at least 101% of the entire pension plan but it’s an immediate allowed to make partial withdrawals premium paid or the fund value, annuity plan. Jeevan Shanti plan on before the policy term, you can only whichever is higher. the other hand has both options for keep one-third of the money, while policyholders. In this plan, the holder for remaining amount one has to Such plans suit conservative can receive pension where he or she compulsorily buy annuities. investors who are looking at market- will get regular income for or up to a linked returns with lesser volatility. specified period or conditions. The draft by IRDAI proposes that the But they should also look at other policyholder withdraw 60% of the options like NPS before investing in For example, in immediate annuity, total amount and allow partial pension schemes. If policyholders policyholder invests a lump sum in a withdrawals after the lock-in period - buy an annuity plan from an product and their pension or annuity which typically is five years. This is insurance company, it is taxable. It is starts immediately, while in deferred one of the significant changes made fully taxable under the head “income annuity, payments by insurers starts by the regulator, which will attract from other sources” and one if not after a certain period, may be after more policyholders to invest in entitled to claim standard deduction attaining the age of 60. pension schemes offered by insurers. against this amount.

There are multiple annuity options to But from cost point, NPS is the best Before zeroing in on the best pension choose from for the policyholder and bet as it is one of the cheapest forms plans, policyholders need to know rate of annuities are guaranteed from of investment globally. NPS charges how much they need post-retirement inception of the policy. This policy only 0.01% as management fee as of to sustain a healthy lifestyle. There can be taken for oneself or as joint now, whereas pension plans come are many plans offered by insurance life with grandparent, parent, spouse with a fund management charge of companies; one should carefully read children, grandchildren or siblings. up to 1.35% and distribution costs of details before choosing a plan. If 7.5% of the premium in the first year there are few years left for retirement For example, in LIC Jeevan Shanti and 2% subsequently. or you do not need money for some scheme if a 45 year old policyholder more time, you can also look at invests `10 lakh, then he will get Even taxation of unit pension plans is deferred annuitieS.

39 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND NUMBERS

Buckfast Recommendations Finance is a maze of umpteen possibilities and choices. And it is easy for individuals to lose their way in this tangle. In such a scenario, an expert comes handy. For, he alone can wade through the enigmatic world of finance and simplify choices for investors.

Buckfast Research, the research arm of Buckfast Financial Advisory Services Pvt Ltd, recommends mutual fund schemes that can be considered by investors.

About Buckfast Research

Buckfast Research, the research arm of Buckfast Financial Advisory Services Pvt Ltd is guided by a team of professionals with more than 50 years of cumulative experience with leading Indian and Global Mutual Fund companies.

A number of parameters have been taken into consideration while making the recommendations. Some of the guidelines are track record of the scheme and consistency, risks associated with the scheme, fund house pedigree and credentials of the fund manager.

However, there is no specific time frame for the investment as such. It depends entirely on an investor’s objectives, investment timeline, risk tolerance and type of scheme he/she wishes to invest in. By and large, equity schemes are suggested with a long-term investment horizon.

Disclaimer Mutual Fund Investments are subject to market risks. Please read the offer document carefully before investing. Source: ACE MF, NAV as on 19th Dec ’18. SIP returns as on 30th June ’18. M=Months, Y=Year, D=Days Past performance is no guarantee of future performance. Returns are of Growth option of Regular plans Returns which are below 1 year period are Annualized Returns

Diversified Funds Historic Return (%) SCHEME NAME NAV 1 Year 3 Years 5 Years 7 Years 10 Years AUM (Cr) Axis Focused 25 Fund 26.92 3.42 16.25 17.43 - - 6455 HDFC Capital Builder Value Fund 285.60 -3.09 12.73 17.68 17.61 19.45 4017 Mirae Asset India Equity Fund 48.38 1.67 15.14 19.37 19.26 21.68 9697 Principal Multi Cap Growth Fund 138.37 -6.32 13.87 17.96 19.15 17.19 823 Tata Equity P/E Fund 130.42 -4.93 15.67 21.47 18.59 19.75 5021

40 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... Large Cap Funds Historic Return (%) SCHEME NAME NAV 1 Year 3 Years 5 Years 7 Years 10 Years AUM (Cr) Axis Bluechip Fund 27.21 8.71 13.59 15.16 16.80 - 3295 ICICI Pru Bluechip Fund 40.67 0.97 13.24 15.14 15.68 18.60 19458 HDFC Top 100 Fund 462.47 1.08 13.26 14.88 15.04 17.18 14961 Reliance Large Cap Fund 33.12 0.83 12.82 17.63 18.13 17.01 11410 Edelweiss Large Cap Fund 33.78 3.33 11.73 14.17 15.43 - 140

Mid and Small Cap Funds

Historic Return (%) AUM (Cr) SCHEME NAME NAV 1 Year 3 Years 5 Years 7 Years 10 Years Aditya Birla SL Small Cap Fund 33.75 -21.77 10.20 20.82 18.66 20.60 2108 HDFC Small Cap Fund 42.29 -3.83 16.50 20.62 19.56 20.47 5672 L&T Emerging Businesses Fund 24.60 -11.64 17.05 - - - 5392 SBI Small Cap Fund 50.11 -17.24 15.00 30.98 26.36 - 1281 Edelweiss Mid Cap Fund 25.60 -12.02 10.18 22.40 21.89 21.85 787

ELSS Schemes (Tax Saving u/s 80-C) Historic Return (%) SCHEME NAME NAV 1 Year 3 Years 5 Years 7 Years 10 Years AUM (Cr) Mirae Asset Tax Saver Fund 16.74 0.25 - - - - 1209 Motilal Oswal Long Term Equity Fund 16.72 -5.91 15.04 - - - 1129 Aditya Birla SL Tax Relief '96 30.81 -1.97 13.08 19.72 19.51 18.92 6984 IDFC Tax Advt(ELSS) Fund 54.08 -6.32 12.64 16.92 18.44 - 1689 Principal Tax Savings Fund 202.78 -6.72 13.62 17.80 19.15 16.31 379

Dynamic Asset Allocation Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

Invesco India Dynamic Equity Fund 27.63 -3.22 8.95 11.65 14.41 15.08 1060 SBI Dynamic Asset Allocation Fund 13.09 9.38 9.86 - - - 358

Balanced Funds Historic Return (%) SCHEME NAME NAV 1 Year 3 Years 5 Years 7 Years 10 Years AUM (Cr) HDFC Hybrid Equity Fund 51.24 -9.94 6.70 12.89 11.39 14.78 21861 L&T Hybrid Equity Fund 25.61 -2.02 9.33 15.95 16.34 - 10203 Mirae Asset Hybrid - Equity Fund 14.04 2.63 12.64 - - - 1404 Reliance Equity Hybrid Fund 53.08 -3.15 9.52 15.56 15.54 17.04 13326

41 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... Corporate Bond Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

Aditya Birla SL Corp Bond Fund 69.56 6.46 7.85 8.65 8.86 7.06 12536 Franklin India Corp Debt Fund-A 64.16 6.94 7.96 9.04 9.23 8.49 812 HDFC Corp Bond Fund 20.11 5.73 7.78 8.55 8.69 - 11285 IDFC Corp Bond Fund 12.36 5.75 - - - - 11215

Equity Savings (Arbitrage MIP) Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

HDFC Equity Savings Fund 35.48 1.80 10.51 9.88 9.55 10.46 6732 Reliance Equity Savings Fund 12.52 -0.29 7.19 - - - 2327 Kotak Equity Savings Fund 13.82 4.47 8.35 - - - 2261

Monthly Income Plans Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

ICICI Pru Regular Savings Fund 41.27 4.88 9.66 11.50 11.21 10.87 1589 Kotak Debt Hybrid Fund 29.75 -0.28 7.62 9.49 9.43 8.38 291 Reliance Hybrid Bond Fund 42.47 3.57 7.55 10.35 10.03 10.02 2046

Dynamic Bond Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

Axis Dynamic Bond Fund 18.43 5.69 7.52 8.65 8.25 - 147 Franklin India Dynamic Accrual Fund 64.84 7.84 8.91 9.93 9.05 8.05 3683 ICICI Pru All Seasons Bond Fund 22.52 5.53 9.11 10.47 10.26 - 1984 UTI Dynamic Bond Fund 20.70 4.21 7.92 9.10 9.13 - 1049

Credit Risk Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

BOI AXA Credit Risk Fund 12.97 -0.58 6.59 - - - 1007 Franklin India Credit Risk Fund 19.03 7.68 8.32 9.21 9.40 - 7011 UTI Credit Risk Fund 16.38 5.11 7.52 8.55 - - 5052 Reliance Credit Risk Fund 25.11 5.52 7.64 8.50 8.58 8.10 10424

42 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... Banking & PSU Debt Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

HDFC Banking and PSU Debt Fund 14.55 4.93 7.52 - - - 2729 Kotak Banking and PSU Debt Fund 40.95 6.10 7.53 8.14 8.28 7.21 858 UTI Banking & PSU Debt Fund 14.89 6.33 8.20 - - - 794

Medium to Long Duration Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

ICICI Pru Bond Fund 24.88 3.74 6.81 8.73 8.27 8.03 2859 SBI Magnum Income Fund 43.77 4.11 7.83 8.37 8.23 7.02 1315 UTI Bond Fund 53.19 3.05 7.02 8.64 8.15 6.94 799

Medium Duration Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 month 6 month 1 Year 3 Years 5 Years

Axis Strategic Bond Fund 17.68 6.24 8.47 9.44 - - 1243 Franklin India Income Opportunities Fund 21.70 7.35 8.21 9.10 9.18 - 3779 UTI Medium Term Fund 13.21 5.01 7.74 - - - 281

Short Term Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 1 month 3 month 6 month 1 Year 3 Years

Axis Short Term Fund 19.65 5.85 7.24 7.95 8.14 - 4079 Franklin India ST Income-Inst 3198.76 8.37 8.82 9.58 9.64 9.48 11644 HDFC Short Term Debt Fund 20.07 6.50 7.55 8.33 8.59 - 8704 IDFC Bond Fund - Short Term Plan 36.82 5.75 6.94 7.79 7.98 7.43 5017

Money Market Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 1 month 3 month 6 month 1 Year 3 Years

Aditya Birla SL Money Manager Fund 244.25 7.82 7.44 7.98 8.43 7.91 5911 ICICI Pru Money Market Fund 252.62 7.55 7.30 7.88 8.32 7.49 5062 UTI Money Market Fund-Inst 2048.23 7.67 7.34 7.90 8.33 - 2522

43 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... Low Duration Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 1 month 3 month 6 month 1 Year 3 Years

Franklin India Low Duration Fund 21.12 8.06 8.78 9.25 9.41 - 6528 Kotak Low Duration Fund 2229.04 7.10 7.81 8.41 8.48 8.17 4475 Reliance Low Duration Fund 2514.83 7.09 7.48 7.98 8.43 7.97 10523 UTI Treasury Advantage Fund-Inst 2517.60 7.08 7.73 8.25 8.64 8.13 7088

Ultra Short Term Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 1 month 3 month 6 month 1 Year 3 Years

BOI AXA Ultra Short Duration Fund 2211.65 7.47 8.22 8.54 8.62 7.82 414 SBI Magnum Ultra Short Duration Fund 4046.39 7.81 7.37 7.89 8.30 7.70 4419 Reliance Ultra Short Duration Fund 2838.52 7.18 6.61 7.18 7.67 6.93 4292 Franklin India Ultra Short Bond Fund-Super Inst 25.54 8.47 8.86 9.26 9.51 8.78 14700

Liquid Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 1 month 3 month 6 month 1 Year 3 Years

Aditya Birla SL Liquid Fund 292.95 7.39 7.26 7.88 8.34 7.83 62310 Axis Liquid Fund 2022.91 7.43 7.27 7.86 8.30 - 23723 Franklin India Liquid Fund 4289.35 6.70 6.57 7.23 7.71 7.22 7231 Kotak Liquid Fund 3697.52 7.34 7.21 7.82 8.28 7.78 33984

Arbitrage Funds Historic Return (%) SCHEME NAME AUM (Cr) NAV 3 months 6 months 1 Year 3 Years 5 Years

Invesco India Arbitrage Fund 22.20 5.90 6.03 6.73 7.27 6.87 344 Kotak Equity Arbitrage Scheme 25.96 6.25 6.29 7.10 7.73 7.35 13739 L&T Arbitrage Opp Fund 13.34 5.96 6.13 - - - 907 UTI Arbitrage Fund 24.45 6.07 6.12 6.83 7.19 7.00 1305

44 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND NUMBERS

TECHNICAL OUTLOOK

above the 11,000 level. As long as Sectors such as Metals, Oil & Gas, the Nifty remains below the Finance and Technology have mentioned level, an up move with attracted a lot of short positions and The Indian stocks weakened last week, limited upside could be seen in the are likely to underperform in the next mirroring the weakness in the global market. On the downside though, the month. Most sectors are facing markets. next major support exists at 10,440, liquidation of long positions, which and later on at the 10,370 level. doesn’t augur well for the next The weakness in the domestic stock month. markets was preceded by seven Overall, the view is cautious. Market consecutive sessions of gains with participants are advised to not India VIX, which measures the the markets gaining over 4%, aided generate major long positions at immediate 30-day volatility in the by lower oil prices, government’s current levels. Market participants market, remained in the range of recapitalization measure for public should be stock-specific and follow 12-20 for most part of October. sector banks, Reserve Bank of the trend until it reverses. Going forward, VIX will continue to India’s liquidity-boosting measures remain elevated due to global risks. and appointment of new Governor at Support for the Bank Nifty lies at the the Indian central bank - RBI. 26,540-mark, aided by the 50-DMA. The Put Call Ratio-Open Interest The Bank Nifty is well-placed above (PCR-OI) for Nifty Options has been Technically, after the Nifty pulled the 200-DMA, indicating a good in the range of 1.25-1.7 in the month back over 650 points at a stretch sign. Going ahead, the rally is likely of December. Going forward, it is from 10,333 points towards 10,985- to continue towards the 26,540 level. expected to remain subdued and in mark, the market took a breather last If it moves below the 26,540 level, the range of 1.2-1.5 in January. Friday and halted its rally at the then we may witness a rally towards 100-DMA. 26,170-26,000 levels. The markets are believed to remain highly volatile in January with Despite relatively outperforming its On the flip side below 27,100, we underlying selling pressure near global and other Asian peers, the may see a rally on upside towards resistances. Important supports on Nifty ended the last trading day of 27,500-27,700 levels. The technical the other hand might provide only the week with a deep cut below the set up on the Bank Nifty is temporary relief. The index is primed 200-DMA. The pattern analysis positive-to-cautious. Therefore, to break below the 10,500 support shows that the Nifty has halted a traders are advised to trade with a level in the short- to medium-term. prolonged pullback at the 100-DMA strict stop loss. level, which also happens to be a OPTIONS STRATEGY pattern resistance in the form of a On the Nifty Options front for the minor double top. January series, the highest Open BEAR PUT SPREAD Interest (OI) built up is witnessed Looking at the pattern we believe the near 10,000 and 10,500 put strikes, It can be initiated by ‘Buying 1 lot selling pressure is likely to continue. whereas on the call side, it is 31JAN 10500 PE (`135) and Selling The Nifty has immediate support at observed at the 10,600 and 11,000 1 lot 31JAN 10300 PE (`90)’. The 10,570 level 50-DMA and any move strikes. net combined premium outflow below the support may intensify its comes to around 45 points, which is selling towards 10,440/10,370 levels. The December expiry (one day also your maximum loss. Maintain a The Relative Strength Index or RSI before the expiry) has seen target of 100 points premium gain. on the daily chart is 46.66 and it higher-than-average rollovers in The maximum profit one can get is stays neutral, showing no divergence Nifty but lower-than-average rolls in 155 points if the Nifty expires below against price. Bank Nifty, indicating a mixed bias. the 10,300 level in January. The However, some aggressive shorts volatility is likely to continue in the However, the bulls will be able to have been seen in the Nifty, which next month with VIX at elevated take control only if the Nifty closes does say that the markets might be levels. Expect selling near resistances and sustains for 1-2 trading sessions under selling pressure next month. in the next expirY.

45 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... BEYOND LEARNING TECHNOLOGIES OF TOMORROW Managing finances is a cakewalk today thanks to the unlimited options being offered by Fintech companies

46 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... is that it is simply convenient at the issued by a bank can also be tracked click of a mouse. Now, you need not through Internet banking login. modify your schedule to reach a Transactions can be checked and bank’s branch during working hours bills can also be paid. or to co-ordinate with agents to get things done. VIRTUAL WALLETS/DIGITAL WALLETS Further, thanks to auto-debit features e have moved to a digital era where for your investments and/or In the pre-demonetisation era, everything can be done online - payments, you need not miss any physical cash used to be king. grocery shopping, buying books, deadline regarding your investments. However, with cash becoming a Wfurniture, and almost anything you scarce commodity because of want. Digitisation has touched every What are the things that can be done demonetisation, several digital aspect of our lives, thus bringing in digitally in the financial services wallets or mobile wallets, which convenience and ease of doing space? Let us have a bird’s eye view were already in existence at that things. What has aided this of the various options/ solutions that time, got a fillip. transformation is the rapid are currently available to customers penetration of Internet and mobile when it comes to managing finances, You can make payments by using phones coupled with excellent access making payments as well as loans. your mobile phones without carrying to data at reasonable rates. cash provided the vendor has the INTERNET BANKING system to accept it. This brings in so Several industries have been much convenience because you need impacted by this technology-driven Financial institutions offer online not carry change and cash too. change. Some of the industries are banking or virtual banking services hotel, transportation and journalism through their websites, enabling You can also transfer funds from one among others. The financial world customers to monitor their balances PayTm account to another if you too has not been left behind. and to make payments as well as have to pay a friend. PayTm is Digitalisation has brought about a initiate fund transfers (real time gross almost synonymous with mobile sea change in the area of finance too. settlement, National Electronic Fund wallets. However, there are several Transfer or Electronic Clearing others such as MobiKwik and What is digitisation in financial System or Immediate Payment Oxigen, among others. services? It is the marriage of Services), authenticate income tax technology and financial services, returns filed, register auto debit In order to enable fungibility of bringing to forefront innovative facility for Systematic Investment funds from one wallet to another, the solutions in the financial arena. It Plans (SIPs) in mutual funds and Reserve Bank of India (RBI) has simply means delivering financial create a fixed deposit, among other issued guidelines, which when services through any device that is things. implemented will bring in added connected to the Internet, using a convenience so that you can reliable and secure system. That These services are also available on consolidate funds in one wallet if you could be just to access information or the mobile app, allowing a customer have to make a big purchase or don’t to make payments, transfers or to do things on the go. Internet want small amounts to lie in the investments as the case may be. banking services has practically different wallets you have. eliminated the need to go to a bank’s The main objective of digitisation is branch for things such as checking Digital or mobile wallets are now a to move away from the use of cash, balances, issuance of new cheque saviour should you forget your wallet and shopping at brick-and-motor books, transferring funds, etc. at home or forget to withdraw cash stores to online, for things as simple from ATMs. as fund transfers to more complex You can access your bank account issues such as monitoring of one’s anywhere in the world to complete EMI CARDS portfolios, budgeting, investments any transaction which is digitally and payments. enabled. Having an Internet banking It is a payment instrument with a login id is the most basic requirement pre-approved loan amount, which The biggest benefit of digitalisation that facilitates it. Also, credit cards can be used for shopping and also for

47 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... withdrawing cash. It is easily features. Select the one with features come in handy because of simplistic available online and is provided by that suits your needs. needs. companies such as Bajaj Finance. Because of the pre-approved loan BUYING INSURANCE ONLINE However, for advance advisory limit, it makes purchases easy and services like real estate investment the EMI repayment tenure can be Insurance companies offer a broad planning, robo-advisors are not as chosen while applying for the card. spectrum of products online across effective. For beginners, you have a For most bulk purchases, this card life and non-life categories. Almost plethora of robo-advisory firms to comes in handy as buyers need not all insurance companies sell select from - scripbox, fundsindia, make upfront payments for their insurance policies online where any goalwise and arthayantra, among purchases. medical underwriting is not required. others. For example, car insurance or travel ONLINE LOANS insurance can be bought online and EQUITY SHARES, one can make easy comparisons to COMMODITIES, GOLD AND For unsecured/ personal loans, there select the one that is most MUTUAL FUNDS is no need to visit a bank’s branch. appropriate. Aggregators such as bankbazaar Each of these can be bought online provide comparable details from Even life insurance policies having so as to have a diversified portfolio. which you can select and apply for coverage below a particular threshold For shares, you need to have a share the loan online. This saves so much are available online. You just need to trading account, for commodities an effort as it reduces the hassle of fill forms online and upload the account with the commodities visiting the finance company for loan necessary documents or courier them exchange, gold can be brought in the sanction. Since these are all to the insurance provider. form of exchange-traded funds unsecured loans, they warrant careful (ETFs) and gold schemes offered by study as interest rates could be quite The added advantage of buying mutual fund houses. high. insurance online is that they come cheaper as you have eliminated the Investment in mutual funds have BUDGETING middlemen. Furthermore, owing to never been easy. Once you have gone easy comparability by aggregators through the process of setting up a Expense management is an essential such as Probus Insurance or folio (KYC and other documents), all part of financial planning as it BankBazaar, you tend to choose a investments with that fund can be determines the amount of funds product that is best for you. This way done online. If you are a new available for investment and other the decision is more informed. investor, an e-KYC can be done. But purposes. Do you often wonder this restricts the investment to where all the money is being spent ROBO-ADVISORY `50,000 per AMC. and in fact do not have any idea of the various expense heads? This is a system generated financial So, if in-person verification is done advice, which eliminates human once, additional investments can be The discipline of keeping track of the interference while providing easily done online. Websites not only various expense heads does not come financial planning services. The allow you to invest in mutual fund naturally to many of us. By using an system will collect data from the schemes, but also allow you to expense management tool, one can individual by asking several monitor your investments across get a clear picture of how much has questions, which will be analyzed by fund houses through their respective been spent and where expenses can an algorithm. web pages and apps. be reined in. A plan will be provided, which will SAFETY WHILE There are several added features that entail where the investment should TRANSACTING DIGITALLY applications provide such as be made - in which asset class. reminders to pay bills and alerts Because of the elimination of Online frauds are rampant as there when a limit is breached, among agents/human interface, they are are cyber criminals that know how to others. Some of the most commonly cheaper and are available anytime exploit a system’s vulnerabilities. used apps are Wally, Chillr, Walnut, anywhere. For those starting off with Therefore, as users of digital etc. Each one of them has unique financial planning, robo-advisors will services, we need to exercise caution

48 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... and also be aware of the possible have won something and you need to IN A NUTSHELL ways in which we can be tricked into give all your personal details and being a victim of cybercrime. bank account number for the same to Demonetisation gave digitilisation be credited to your account? These the necessary fillip by forcing people Wi-fi Networks & Password: These fake emails trap you into giving to go cashless on account of shortage do have security flaws. Hence, it is sensitive personal information to the of cash. This trigger has helped India essential to use only secured scamsters, leading to frauds. to be exposed to the benefits of going networks, i.e. non-public networks digital. when transacting or accessing Not only emails, people also get financial information. Changing fraudulent SMSes. Avoid clicking on The start is truly encouraging and in passwords frequently to the any such links that look attractive to order to sustain this, discounts are non-dummy ones (example abc123) protect yourself from cyber crimes. being offered if things are done and also not sharing them will digitally. Some of the discounts on enhance security and make it difficult Vishing or voice phishing is also offer include - discount on booking for cyber hackers. very common where a fraudster calls railway tickets online, a predefined posing as someone from a bank or percentage off on fuel purchased Malware: These are typically finance company to extract sensitive through e-wallets, debit/ credit cards, applications or programmes, which if information, which can be used bill payments, etc. installed on the mobile phone or inappropriately. computer, compromises its security Technology is transforming the and makes it vulnerable to cyber Ransomware: While corporates are world. You have so many budding frauds. Thus, it is essential to be fully generally victims to ransomware, fintech firms that are still working aware of the applications that you are even individuals can be subject to it. towards bettering financial services. installing and downloading. They It essentially means that a hacker should be from sources that you gains access to your mobile phone or If you are not technology-savvy, know and from developers that have computer and can block access to it there is no better time to start than a good reputation. till some money is received. For now. The kind of convenience and safety reasons, it is essential that one transparency that is on offer will Phishing & Vishing: Haven’t you should not click on any email or transform the way you look at come across emails saying that you SMS that is suspicious. financial serviceS.

Now, Commodity Trading Is No More A Puzzle. Commodity trading can be confusing especially if one is inexperienced and lacks the necessary skills to trade successfully. At Nirmal Bang, our team of seasoned analysts with years of experience and in-depth knowledge can help you spot the underlying clues and create the investment strategies that best suit your commodity trading requirements.

eyond Powered by

49 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... INFORMATION THAT MATTERS

11:15 11:15 11:15

XYZ Stock 11:15 XYZ Stock XYZ Stock

XYZ Stock XYZ Stock

The BEYOND App provides stock-specific data like Company Overview, Updated Financials, Key Ratios, Shareholding Patterns, Mutual Fund Holdings and much more to help you take right investment decisions based on information that matters to you. Download BEYOND App on

eyond Powered by

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com BEYOND BUZZ

IMPORTANT JARGON

ELECTION SETBACK FOR BJP But with general elections barely a few months from now, it increases the relevance of the outcome of these state elections. The voting sentiment takes significance and a The outcome of the recently held State Elections came vote share swing in these states is already visible. as a surprise to the markets. Bharatiya Janata Party (BJP) lost power in three important states: Rajasthan, Madhya At the national level, the BJP has 272 seats out of total Pradesh and Chhattisgarh. The results will have a bearing 543 seats in Lok Sabha. Rajasthan (25), Madhya Pradesh on strategies that the BJP will adopt ahead of the general (29) and Chhattisgarh (11) in total have 65 seats. In the elections to be held in April-May next year. 2014 general elections, BJP won 59 of these seats. Some analysts expect BJP to lose 30 seats in the 2019 general What Were The Expectations? elections if the current mood persists among voters.

Private opinion polls predicted a tight race between BJP What Is The Biggest Fear For The Markets? and Indian National Congress (INC) in Madhya Pradesh and Chhattisgarh, and expected a loss for the BJP in As promised in their election manifestos, the INC has Rajasthan. But the markets had expected at least one win waived loans for farmers in Rajasthan, Madhya Pradesh considering these states were traditional strongholds of and Chhattisgarh. The biggest fear is that the central the BJP. The BJP was expected to lose in Mizoram and government may announce some competitive populist Telangana, the other two states that underwent elections measures to attract voters ahead of the general elections. simultaneously. This may come at the cost of fiscal stability, which the stock markets may dislike. Markets have factored in a What Were The Results? BJP-led government (if not with a majority) forming the next government in 2019. The market is looking for BJP, being the incumbent government, lost power in stability and continuity in policies rather than any Rajasthan, Madhya Pradesh and Chhattisgarh. The final disruptive populist rhetoric. tally for these states for BJP is Rajasthan (73/199 seats), Madhya Pradesh (109/230 seats), Chhattisgarh (15/90 What Will Happen To Fund Flows? seats), Mizoram (1/40 seats) and Telangana (1/119 seats). Most importantly, the Indian National Congress (INC) Since 2014, a lot of small investor’s money has flown made a significant gain in these assembly elections and into the markets. Lack of confidence in the government came to power in Rajasthan, Madhya Pradesh and and political uncertainty could impact domestic fund Chhattisgarh. Since expectations were on the lower side, flows and market performance in the next few months. stock markets did not react very negatively to the verdict. Commentaries from foreign investors’ post-election verdict suggest that they expect the BJP to win in 2019. What Does The BJP Loss Tell About The General Elections To Be Held Next Year? What To Watch Out For From Now To The General Elections? The voting choices of people at state and national elections vary. Both the elections have different agendas. While the markets haven’t reacted much to the election

51 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... verdict, the increasing popularity of INC may force Is The RBI Truly Independent? markets to evaluate possibilities of various outcomes. Many coalition arrangements are likely to be made by The RBI is overseen by the RBI Act, 1934. The Governor political parties ahead of the general elections. Some and the Deputy Governors are hired by the government. analysts also expect further relaxation in GST norms and But, over the years, the RBI has through its leadership even some relief for direct taxpayers in the run-up to the made it a politically neutral organization. elections. All these may throw some bouts of volatility to the markets. The RBI performs important functions such as being a regulator to banks, banker to the government, and URJIT OUT, SHAKTIKANTA IN managing currency and interest rates in the system, among other roles. And all those functions are performed In a surprise move, Urjit Patel resigned as the Governor irrespective of the political masters at the centre. Issues of the Reserve Bank of India (RBI) on 10th December. between the government and the RBI are sorted out The sudden resignation left market participants wary over through various formal and informal communications the development. But the government swiftly filled the between the two. vacant post by hiring Shaktikanta Das, who once served as a bureaucrat in the Finance Ministry. Who Is The New Governor?

Why Did Urjit Patel Resign? Shaktikanta Das, who retired as Economic Affairs Secretary in 2017, has been a seasoned bureaucrat in the While the Governor cited personal reasons for the Ministry of Finance. He had overseen the government’s resignation, it is speculated that the tussle between the demonetisation drive and the adoption of the Goods and government and the central bank in the last few months Services Tax (GST). may have precipitated such a move. It shocked markets, especially since the RBI board meeting on 19th Is The New Governor A Hawk Or A Dove November had called a truce on various issues between As Far As Interest Rates Are Concerned? the parties. Since 2016 interest rate decisions are taken by the What Were The Issues? 6-member Monetary Policy Committee (MPC) in which the RBI Governor is a member. So the vote of each While nothing has been communicated officially by either member counts for interest rate decisions. However, the party, media reports suggest that there are some 12 odd Governor’s inclination counts only in case of a tie issues over which the government sought the RBI’s between the MPC members as then the Governor casts a opinion. second vote. Market participants reckon the new Governor, based on the past speeches and commentary Few controversial issues include: the government wanted made by him, as pro-growth and dovish on interest rates. the RBI to make more liquidity available to non-banking finance companies (NBFCs), a restructuring scheme for Will The New Governor Be Accommodative On small and medium firms, seeking relaxation of tight Various Government Demands? lending rules on over a dozen public sector banks under RBI’s prompt corrective action (PCA), seeking leeway to In the past, the post of governorship has been held by stressed power sector assets, loosening up of the capital ex-finance ministry personnel and by economists serving adequacy framework of state-run banks and transferring the Government of the day (Y V Reddy, Duvvuri excessive reserve money in RBI’s balance sheet to the Subbarao, etc). So, Mr Shaktikanta Das taking over the government. reins of the RBI is not a new trend.

What Was The Bigger Worry For The Market? In fact, the new RBI Governor comes across as a better communicator and his connections with the Finance While differences between the government and the RBI Ministry will come in handy in resolving disputes with are new, the sudden resignation has raised questions about the government. Markets expect some contentious issues the RBI’s independence and whether the government is like forbearance for small and medium enterprises and an trying to stifle the institution. Such tactics by the exit route for banks under the PCA framework to see government are seen unfavourably by ratings agencies. more relaxation from the RBI in the near futurE.

52 Beyond Market 16th - 31st Dec ’18 It’s simpli ed... INTERNATIONAL STOCK EXCHANGE HOLIDAYS FOR 2019

Date China India Japan Singapore UK USA Hong Kong Taiwan Korea 1 Jan '19 Holiday Holiday Holiday Holiday Holiday Holiday Holiday Holiday 2 Jan '19 Holiday 3 Jan '19 Holiday 14 Jan '19 Holiday 21 Jan '19 Holiday 4 Feb '19 Holiday Holiday 5 Feb '19 Holiday Holiday Holiday Holiday Holiday 6 Feb '19 Holiday Holiday Holiday Holiday Holiday 7 Feb '19 Holiday Holiday Holiday Holiday 8 Feb '19 Holiday Holiday Holiday 11 Feb '19 Holiday 18 Feb '19 Holiday 19 Feb '19 Holiday 28 Feb '19 Holiday 1 Mar '19 Holiday Holiday 4 Mar '19 Holiday 21 Mar '19 Holiday Holiday 4 Apr '19 Holiday 5 Apr '19 Holiday Holiday Holiday 17 Apr '19 Holiday 19 Apr '19 Holiday Holiday Holiday Holiday Holiday 22 Apr '19 Holiday Holiday 29 Apr '19 Holiday 30 Apr '19 Holiday 1 May '19 Holiday Holiday Holiday Holiday Holiday Holiday Holiday 2 May '19 Holiday 3 May '19 Holiday 6 May '19 Holiday Holiday 12 May '19 Holiday 13 May '19 Holiday Holiday 19 May '19 Holiday 27 May '19 Holiday Holiday 5 Jun '19 Holiday Holiday 6 Jun '19 Holiday 7 Jun '19 Holiday Holiday Holiday 17 Jun '19 Holiday 1 Jul '19 Holiday 4 Jul '19 Holiday 15 Jul '19 Holiday 8 Aug '19 Holiday 9 Aug '19 Holiday 11 Aug '19 Holiday 12 Aug '19 Holiday Holiday 15 Aug '19 Holiday Holiday 26 Aug '19 Holiday 2 Sep '19 Holiday Holiday 10 Sep '19 Holiday 12 Sep '19 Holiday 13 Sep '19 Holiday Holiday Holiday 14 Sep '19 Holiday 16 Sep '19 Holiday 23 Sep '19 Holiday 1 Oct '19 Holiday Holiday 2 Oct '19 Holiday Holiday 3 Oct '19 Holiday Holiday 4 Oct '19 Holiday 7 Oct '19 Holiday Holiday Holiday 8 Oct '19 Holiday 9 Oct '19 Holiday 10 Oct '19 Holiday 11 Oct '19 Holiday 14 Oct '19 Holiday 22 Oct '19 Holiday 27 Oct '19 Holiday 28 Oct '19 Holiday 4 Nov '19 Holiday 12 Nov '19 Holiday 28 Nov '19 Holiday 25 Dec '19 Holiday Holiday Holiday Holiday Holiday Holiday 26 Dec '19 Holiday Holiday 31 Dec '19 Holiday Holiday 11:15

12:40 AM 100%

eyond

Worth It! We help you get your money’s worth without letting volatility in the markets reduce its value. Download BEYOND App on eyond Powered by

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com

11:15 LEAVE IT TO US Draw On The Vast Experience Of Seasoned Analysts For Financial Advice That Suits Your Investment Needs. Simply Download The Online Trading App Beyond, And Get Started.

Download BEYOND App on

eyond Powered by

For free account opening, give us a missed call on 18003157577 | www.nirmalbang.com DISCLAIMER RNI Reg. No. MAHENG/2009/28962 In the preparation of the content of this magazine, Nirmal Bang Securities Private Limited has used information that is publicly available, including information developed in-house. Such information has not been independently verified and we make no representation or warranty as to its accuracy, completeness or correctness. Any opinions or estimates herein reflect the judgement of Nirmal Bang Securities Private Limited at the date of this publication/ communication and are subject to change at any point without notice. This is not a solicitation or any offer to buy or sell. This publication/ communication is for information purposes only and is not intended to provide professional, investment or any other type of advice or recommendation and does not take into account the particular investment objectives, financial situation or needs of individual recipients. For data reference to any third party in this material no such party will assume any liability for the same. Further, all opinion included in this magazine are as of date and are subject to change without any notice. All recipients of this magazine should seek appropriate professional advice and carefully read the offer document and before dealing and/ or transacting in any of the products referred to in this material make their own investigation. Nirmal Bang Securities Private Limited, its directors, officers, employees and other personnel shall not be liable for any loss (financial or otherwise), damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary and consequential, as also any loss of profit in any way arising from the use of this material in any manner whatsoever. The recipient alone shall be fully responsible/ are liable for any decision taken on the basis of this material. This magazine is prepared for private circulation only. Nirmal Bang Securities Private Limited, its affiliates and their employees may from time to time hold positions in securities referred to herein. Nirmal Bang Securities Private Limited or its affiliates may from time to time solicit from or perform investment banking or other services for any company mentioned in this document.