MF 35 Presentation A5 - 11 May.cdr

B
R
T
S
BR
3STBRST
WAYS TO
BUY RIGHT
SIT TIGHT
BRSTBRST
Motilal Oswal
MOSt Focused 25 Fund
Motilal Oswal
MOSt Focused Midcap 30 Fund
Motilal Oswal
MOSt Focused Multicap 35 Fund
Invests in enduring wealth creators
Invests in emerging wealth creators
Invests in emerging and
enduring wealth creators
Product Labeling
Name of the scheme
This product is suitable for investors who are seeking*
Motilal Oswal MOSt Focused
Multicap 35 Fund (MOSt Focused
Multicap 35)
An Open Ended Diversified Equity
Scheme
• Long-term capital growth
•Investment in a maximum of 35 equity and equity related
instruments across sectors and market capitalization levels
• High risk
(BROWN)
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
Note: Risk is represented as:
(BLUE) investors
(YELLOW) investors
(BROWN) investors
understand that their
understand that their principal
understand that their
principal will be at low risk
will be at medium risk
principal will be at high risk
2
Inflation: Biggest destroyer of purchasing power…
Over FY79-14 inflation on an average has been 8.4%,
eroding purchasing power of ` by 94%
120
100
Infla on erodes purchasing power of money
Rupee
80
60
40
20
5.66
Mar-79
Dec-79
Oct-80
Jul-81
Apr-82
Jan-83
Oct-83
Jul-84
Apr-85
Jan-86
Oct-86
Jul-87
Apr-88
Jan-89
Oct-89
Jul-90
Apr-91
Jan-92
Oct-92
Jul-93
Apr-94
Jan-95
Oct-95
Jul-96
Apr-97
Jan-98
Oct-98
Jul-99
Apr-00
Jan-01
Oct-01
Jul-02
Apr-03
Jan-04
Oct-04
Jul-05
Apr-06
Jan-07
Oct-07
Jul-08
Apr-09
Jan-10
Oct-10
Jul-11
Apr-12
Jan-13
Oct-13
Jul-14
Apr-15
CPI =Consumer Price Index
Source: Bloomberg, MOAMC internal analysis, Data as on 30th April, 2015
3
Key Objective of Investing
Equities significantly enhance purchasing power
1,750
1528
1,500
If you had invested Rs 100 .....
1,000
750
500
250
213
103
Mar-79
Dec-79
Sep-80
Jun-81
Mar-82
Dec-82
Sep-83
Jun-84
Mar-85
Dec-85
Sep-86
Jun-87
Mar-88
Dec-88
Sep-89
Jun-90
Mar-91
Dec-91
Sep-92
Jun-93
Mar-94
Dec-94
Sep-95
Jun-96
Mar-97
Dec-97
Sep-98
Jun-99
Mar-00
Dec-00
Sep-01
Jun-02
Mar-03
Dec-03
Sep-04
Jun-05
Mar-06
Dec-06
Sep-07
Jun-08
Mar-09
Dec-09
Sep-10
Jun-11
Mar-12
Dec-12
Sep-13
Jun-14
Mar-15
Purchasing Power
1,250
Source: Bloomberg, MOAMC internal analysis, Data as on 30th April, 2015
Note: The information herein is used for comparison purpose and is illustrative and is not sufficient and shouldn’t be used for the development or implementation of
an investment strategy. It should not be construed as investment advice to any party. Past performance may or may not be sustained in future.
4
Nominal Value
Key Objective of Investing
32,500
30,000
27,500
25,000
22,500
20,000
17,500
15,000
12,500
10,000
7,500
5,000
2,500
If you had invested Rs 100 .....
`27,011
`3,760
`1,829
Mar-79
Dec-79
Sep-80
Jun-81
Mar-82
Dec-82
Sep-83
Jun-84
Mar-85
Dec-85
Sep-86
Jun-87
Mar-88
Dec-88
Sep-89
Jun-90
Mar-91
Dec-91
Sep-92
Jun-93
Mar-94
Dec-94
Sep-95
Jun-96
Mar-97
Dec-97
Sep-98
Jun-99
Mar-00
Dec-00
Sep-01
Jun-02
Mar-03
Dec-03
Sep-04
Jun-05
Mar-06
Dec-06
Sep-07
Jun-08
Mar-09
Dec-09
Sep-10
Jun-11
Mar-12
Dec-12
Sep-13
Jun-14
Mar-15
-
Source: Bloomberg, MOAMC internal analysis, Data as on 30th April, 2015
Note: The information herein is used for comparison purpose and is illustrative and is not sufficient and shouldn’t be used for the development or implementation of
an investment strategy. It should not be construed as investment advice to any party. Past performance may or may not be sustained in future.
5
WHY INVEST IN EQUITIES NOW?
Continued surge in India’s GDP
4,053
FY22E
FY21E
3,344
FY20E
3,037
FY19E
2,758
FY18E
FY17E
2,276
FY16E
FY15E
1,876
FY14
1,708
1,366
1,835
FY07
FY13
FY06
1,879
FY05
FY12
834
FY04
FY10
721
FY03
1,226
524
FY02
FY09
494
FY01
1,239
475
618
948
465
155
FY80
FY00
59
FY70
301
34
FY60
FY90
22
FY51
58 years
FY08
7 years
FY11
GDP (USD bn)
2nd US$ tn
2,074
3rd US$ tn
4 years
2,505
4th US$ tn
3 years
3,681
By 2021 India’s GDP would almost triple from the current level ~5 times the level of FY08 Linear
Economic Growth may leads to Exponential Business Opportunities
Source: MOSL Wealth Creation Study. Data as on 31st March 2015
Note: Above forward-looking statements are based on external current views and assumptions and involve known and unknown risks and uncertainties that
could affect actual results.
7
Blazing growth trails at select companies,
while Index has been rather lackluster
Market Price (Rs.)
Market Price (Rs.)
Performance
(As on 4th January, 2008)
(As on 30th April, 2015)
(Growth)
6,274
8,182
30%
Eicher Motors
416
15,192
3556%
Page Industries
481
13,654
2739%
TTK Prestige
224
3,792
1596%
Lupin
122
1,773
1349%
21
247
1090%
GlaxoSmith C H L
687
6,269
812%
TCS
503
2,464
390%
1,460
6,573
350%
315
881
179%
Name
Nifty Index
GRUH Finance
Nestle India
HCL Technologies
Source: Motilal Oswal AMC internal analysis. Data as on 30th April, 2015.
The Stocks mentioned above are used to explain the concept and is for illustration and comparison purpose only and should not used for development or
implementation of an investment strategy. It should not be construed as investment advice to any party. The stocks may or may not be part of our portfolio/strategy/
schemes. Past performance may or may not be sustained in future
8
Expected upturn in earnings growth of India Inc shall
produce more companies with uncommon profits
Expected Earnings Per Share (EPS) growth of Sensex from FY01 - FY17(E)
FY93-FY15: 14% CAGR
1,662
FY08-15:
8% CAGR
833 820 834
1,404
1,328
1,120
1,180
1,024
FY17E
FY16E
FY15E
FY14
FY13
FY12
FY11
FY10
FY09
540
FY06
446
FY05
FY04
FY03
FY02
FY01
FY00
FY99
FY98
FY97
FY96
FY95
FY94
FY93
361
250 266 291 278 280 216 236 272
181
81 129
720
FY08
FY96-03: 1% CAGR
FY07
FY03-08: 25%
CAGR
FY93-96: 45%
CAGR
2,021
FY15-17E: 20%
CAGR
Strong leadership can further accelerate growth through infrastructure development
Source: Motilal Oswal Securities Ltd. Data as on 31st march 2015
Note: Above forward-looking statements are based on external current views and assumptions and involve known and unknown risks and uncertainties that
could cause actual results. Past performance may or may not be sustained in future.
9
Why
Motilal Oswal
Asset Management Company?
At Mo lal Oswal Asset Management Company (MOAMC), our investment philosophy and inves ng style is
centered on 'Buy Right: Sit Tight‘ principal.
Buy Right Stock Characteristics
Sit Tight Approach
QGLP
‘Q’uality denotes quality of the business and
management
‘G’rowth denotes growth in earnings and
sustained RoE
‘L’ongevity denotes longevity of the
competitive advantage or economic moat of
the business
‘P’rice denotes our approach of buying a good
business for a fair price rather than buying a
fair business for a good price
Buy and Hold: We are strictly buy and hold
investors and believe that picking the right
business needs skill and holding onto these
businesses to enable our investors to benefit
from the entire growth cycle needs even more
skill.
Focus: Our portfolios are high conviction
portfolios with 20 to 25 stocks being our ideal
n u m b e r. W e b e l i e v e i n a d e q u a t e
diversification but over-diversification results
in diluting returns for our investors and adding
market risk
11
Investment process
A business
we
“understand”
Favorable
“long term
economics”
Margin
of
“safety”
Able and
trustworthy
“management”
12
Why Quality?
Quality companies are those which have enduring economic moats (EMC’s)
Payoff profile of EMCs, Non-EMCs and Sensex
Source: 17th Motilal Oswal Wealth Creation Study (WCS) Data upto Fy2012
Note: All rebased to 100 in March 2002. Past performance may or may not be sustained in future.
13
Focus on seeking optimal diversification
60%
Portfolio Standard Deviation v/s Number of Securities
Portfolio Standard Deviation
50%
40%
30%
Diversifiable
Risk
20%
Non-Diversifiable
Systemic Risk
10%
0%
0
5
10
15
20
25
30
35
40
Number of Securities in Portfolio
Source: An Introduction to Risk and Return Concepts and Evidence by Franco Modigliani and Gerald A. Pogue
14
Wealth creators present across the Market Cap Spectrum
Stocks
Market Price
Market Price
Market Cap (Rs. Billion)
(As on 4th January, 2008)
(As on 30th April, 2015)
(As on 30th April, 2015)
Eicher Motors
416
15,192
412
Page Industries
481
13,654
152
Lupin
224
3,792
44
TTK Prestige
122
1,773
797
21
247
90
GlaxoSmith C H L
687
6,269
264
TCS
503
2,464
4,826
1,460
6,573
634
315
881
1,238
GRUH Finance
Nestle India
HCL Technologies
Source: Motilal Oswal AMC internal analysis. Data as on 30th April, 2015.
The Stocks mentioned above are used to explain the concept and is for illustration purpose only and should not used for development or implementation of an
investment strategy. It should not be construed as investment advice to any party. The stocks may or may not be part of our portfolio/strategy/ schemes. Past
performance may or may not be sustained in future.
15
Earnings is concentrated in certain sectors
India Inc's Profit Pool breakdown by sector
10 Highest profit generating sectors
Sector
2014 PAT (INR Billion)
10 Lowest profit generating sectors
% share
Sector
2014 PAT (INR Billion)
Financials
1,117
28
Airlines
-52
Oil & Gas
785
20
Alcoholic Beverages
-41
Technology - Software
454
11
Sugar
-27
Metals & Mining
435
11
Telecom Equipment
-14
Automobiles
263
7
Trading
-9
Utilities - Power
217
5
Ship-building
-7
Consumer - Non-durables
209
5
Computer Education
-5
Healthcare
155
4
Hotels & Restaurants
-5
Cement
45
1
Technology - Hardware
-3
Auto Ancillaries
45
1
Glass & Glass Products
-2
Total of Above
3,726
94
Total Corporate PAT
3,947
100
Total of Above
Total Corporate PAT
-166
3,947
The sector mentioned herein are for general and comparison purpose only and not a complete disclosure of every
material fact. It should not be construed as investment advice to any party. Past performance may or may not be
sustained in future.
Source: 19th Motilal Oswal Wealth Creation Study (WCS) Data for FY2015.
16
Performance of Midcaps and Large Caps can diverge
significantly over time depending on the phase of the cycle
15%
10%
Nifty Outperformance
Returns
5%
0%
5%
10%
-15%
-20%
Midcap Outperformance
-25%
-30%
2006
2007
2008
2009
2010
2011
2012
2013
2014
YTD
Interest Rates, Currency, Shape of the Global economy etc. determine relative attractiveness and
performance of Large vs. Mid Caps.
Source: India Index Services & Products Ltd. Data as on 30th April 2015. Past performance may or may not be sustained in future.
17
Motilal Oswal
MOSt Focused Multicap 35 Fund
(MOSt Focused Multicap 35)
Portfolio Construct
Investment Horizon:
Medium to Long Term
For Whom:
Investors who like to invest with a Long-term wealth creation view
Number of Stocks
Maximum 35 stocks
Allocations
Minimum 65%: Equities
Maximum 35%: Debt/ Money Market Instruments
*The fund may invest in foreign securities upto 10% of total net assets
19
About the scheme
The investment objective of the Scheme is to achieve long term capital appreciation by primarily
investing in a maximum of 35 equity & equity related instruments across sectors and market
capitalization levels. However, there can be no assurance or guarantee that the investment
objective of the Scheme would be achieved.
MOSt Focused Multicap 35 would endeavour to construct such a portfolio that the product is best
suited for medium and long term investment.
High conviction ideas with improved risk-adjusted return characteristics.
'360 degree view' of company to identify competitive advantages.
20
Fund Details
Type of Scheme:
Investment Objective:
An open ended diversified equity scheme
The investment objective of the Scheme is to achieve long term capital appreciation by
primarily investing in a maximum of 35 equity & equity related instruments across sectors
and market capitalization levels. However, there can be no assurance or guarantee that the
investment objective of the Scheme would be achieved.
Benchmark:
CNX 500 Index
Entry/Exit Load:
Plans:
Nil
Regular Plan and Direct Plan
Options (Under each plan):
Dividend (Payout and Reinvestment) and Growth
Minimum Application
Amount:
Rs. 5,000/- and in multiples of Re. 1/- thereafter
Additional Application
Amount:
Rs. 1,000/- and in multiples of Re. 1/- thereafter.
Systematic Investment
Plan (SIP):
Minimum Redemption
Amount:
Minimum installment-Rs.1,000/-(weekly/ fortnightly / monthly) and Rs. 2,000/(quarterly) and in multiples of Re. 1/- thereafter with minimum of 6 installments
for weekly/fortnightly/monthly frequency and minimum 3 installments for
quarterly frequency. The dates for Auto Debit Facility shall be on the 1st, 7th,14th,
21st or 28th of every month
Rs. 1,000/- and in multiples of Re. 1/- thereafter or total investment amount, whichever is
lower.
21
Sector Allocation
Banks
18.75%
Pharmaceuticals
12.34%
Consumer Non Durables
11.07%
Software
10.43%
Auto
10.14%
Finance
8.27%
Petroleum Products
6.64%
Financials
5.31%
Transportation
4.86%
Textile Products
4.50%
Industrial Products
1.83%
Auto Ancillaries
1.72%
Cash & Equivalent
Bank, Pharmaceuticals, and
Consumer Non Durables are the top 3
sector exposures
l Portfolio is well represented across a
wide range of sectors
l
4.14%
Data as on 30th April, 2015
Industry classification as recommended by AMFI
22
Portfolio Holdings
TOP 10 Holdings
Name of Instrument
% to Net Assets
HDFC Bank
7.41
Ajanta Pharma
7.16
Eicher Motors
6.99
Britannia Industries
6.64
Hindustan Petroleum Corporation
6.64
State Bank of India
6.44
Tech Mahindra
5.36
Berkshire Hathaway
5.31
Lupin
5.17
Tata Consultancy Services
5.08
TOP 5 Stocks % to NAV=34.84%
TOP 10 Stocks % to NAV =62.20%
Currently we Hold 20 Stocks
Data as on 30th April, 2015
23
Fund Manager
Mr Gautam Sinha Roy is the Fund Manager of this Scheme and is responsible for
managing investments in equity and equity related instruments of the Scheme.
Mr. Gautam Sinha Roy,
Fund Manager
Mr. Roy has completed his B.E. (Honors) from Jadavpur University, Kolkata and
PGDM from IIM-Calcutta. He has close to 11 years of rich experience largely in
investment management and research. He had worked with Motilal Oswal
Securities Ltd. immediately prior to joining Motilal Oswal AMC. Prior to that, he has
worked with IIFL Capital Pte. Ltd., Mirae Asset Global Investment Pvt. Ltd., Edelweiss
Capital Ltd. and Genpact Ltd in Research and Investment analysis/ management
roles.
He is also the Fund Manager for Motilal Oswal MOSt Focused Long Term Fund
Mr. Abhiroop Mukherjee (For Debt Component)
He is B.com (H), MBA with 4 years of experience in Trading Fixed Income Securities
viz. G-sec, T-bills, Corporate Bonds CP, CD etc. He has earlier worked with PNB GILTS
LTD. as a WDM Dealer for the period 2007-2011
24
Disclaimer
DISCLAIMER: This presentation has been prepared and issued on the basis of internal data, publicly available information and other sources
believed to be reliable. The information contained in this document is for general purposes only and not a complete disclosure of every
material fact and terms and conditions and features of Motilal Oswal MOSt Focused Multicap 35 Fund. The information / data herein alone is
not sufficient and shouldn’t be used for the development or implementation of an investment strategy. It should not be construed as
investment advice to any party. All opinions, figures, charts/graphs, estimates and data included in this presentation are as on date and are
subject to change without notice. While utmost care has been exercised while preparing this document, Motilal Oswal Asset Management
Company Limited does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising
out of the use of this information. The statements contained herein may include statements of future expectations and other forwardlooking statements that are based on our current views and assumptions and involve known and unknown risks and uncertainties that could
cause actual results, performance or events to differ materially from those expressed or implied in such statements. Readers shall be fully
responsible/liable for any decision taken on the basis of this presentation. No part of this document may be duplicated in whole or in part in
any form and/or redistributed without prior written consent of the Motilal Oswal Mutual Fund/Motilal Oswal Asset Management Company
Limited. Readers should before investing in the Scheme make their own investigation and seek appropriate professional advice. Past
performance of the Sponsor/AMC/Mutual Fund and its affiliates does not indicate the future performance of the scheme and may not
provide a basis of comparison with other investments.
Please Read Scheme Information Document (SID) and Statement of Additional Information (SAI) carefully before investing
Statutory Details: Constitution: Motilal Oswal Mutual Fund has been set up as a trust under the Indian Trust Act, 1882. Trustee: Motilal
Oswal Trustee Company Ltd. Investment Manager: Motilal Oswal Asset Management Company Ltd. Sponsor: Motilal Oswal Securities Ltd.
Past performance of the Sponsor/ AMC/ Mutual Fund and its affiliates does not indicate the future performance of the scheme and may
not provide a basis of comparison with other investments.
Mutual fund investments are subject to market risks, read all scheme related documents carefully.
Call: 022 39804238
E-mail: [email protected]
Website: www.motilaloswalmf.com