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September 21, 2011

Sharekhans top SIP fund picks

Why SIP? Disciplined investing Being disciplined is a key to investing success. Through a systematic investment plan (SIP) you can choose to invest fixed amounts in a mutual fund scheme which could be as low as Rs500 at regular intervals (like every month) for a chosen period of time (say for a year). The amount you invest every month or every quarter will be used to purchase units of a SIP of a mutual fund scheme. Small amounts set aside every month towards well performing SIP mutual fund schemes can make an investor achieve his financial goals in future. Invest in instruments that beat Inflation Equity investing can help you combat rising inflation that diminishes the value of your savings.
Illustrative example Price per unit Month Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Dec-10 Total investment (Rs) Average price (Rs) Total units purchased Value of investment after 12 months (Rs)
*NAV as on the 1st of every month. These are assumed NAVs in a volatile market.

SIP over a longer period can reduce the cost per unit Example: An investment of Rs24,000 in a mutual fund resulted in a value of Rs25,200 after 12 months; whereas a SIP mutual fund investment of Rs2,000 per month grew to Rs27,095 after the same period. Fewer efforts to opt for SIP The procedure to invest through SIP is easy. All you need to do is give post-dated cheques or opt for an auto debit of a specific amount towards SIP from your bank account. SIP plans are completely flexible. One can even start a SIP just by placing an order by logging into Sharekhans online mutual fund page. One can invest for a minimum of six months or for a long tenure. Also, there is an option of choosing the investment interval which could be monthly or quarterly.

One-time investment Amount invested (Rs) 24,000 -----------24,000 20 1,200 25,200 Units purchased 1,200 Amount invested (Rs) 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000

SIP Units purchased 100.0 111.1 142.9 90.9 76.9 100.0 111.1 117.7 133.3 111.1 100.0 95.2 24,000 19 1,290 27,095

(Rs) 20 18 14 22 26 20 18 17 15 18 20 21

For Private Circulation only

Sharekhan Ltd, Regd Add: 10th Floor, Beta Building, Lodha iThink Techno Campus, Off. JVLR, Opp. Kanjurmarg Railway Station, Kanjurmarg (East), Mumbai 400 042, Maharashtra. Tel: 022 - 61150000. BSE Cash-INB011073351; F&OINF011073351; NSE INB/INF231073330; CD - INE231073330; MCX Stock Exchange: CD - INE261073330 DP: NSDL-IN-DP-NSDL233-2003; CDSL-IN-DP-CDSL-271-2004; PMS INP000000662; Mutual Fund: ARN 20669. Sharekhan Commodities Pvt. Ltd.: MCX10080; (MCX/TCM/CORP/0425); NCDEX -00132; (NCDEX/TCM/CORP/0142)

Mutual Funds

mutual gains

Date: August 31, 2011 SIP INVST (Monthly Rs1,000) Total amount invested Funds would have grown to 1 year 12,000 Present value (Rs) Average annual return (%) 3 years 36,000 Present value (Rs) Average annual return (%) Present value (Rs) 5 years 60,000 Average annual return (%)

Large-cap funds Franklin India Bluechip Principal Large Cap Fund Birla Sun Life Frontline Equity Fund - Plan A DSP BlackRock Top 100 Equity Fund Tata Pure Equity Fund BSE Sensex Multi-cap funds SBI Magnum Global Fund 94 Tata Dividend Yield Fund UTI Opportunities Fund UTI Dividend Yield Fund UTI Equity Fund BSE 500 Mid-cap funds Sundaram Select Midcap - Growth SBI Magnum Sector Funds Umbrella-Emerg Buss Fund Birla Sun Life Mid Cap Fund - Plan A UTI Mid Cap Fund - Growth IDFC Premier Equity Fund - Plan A BSE Midcap Tax saving funds ICICI Prudential Taxplan Franklin India Taxshield Fidelity Tax Advantage Fund HDFC Long Term Advantage Fund Tata Tax Saving Fund S&P Nifty
(*invested on 1st day of every month)

10982 10488 10625 10960 10790

-15.4 -22.6 -20.6 -15.7 -18.2 -23.0

44644 43733 42838 42634 42361

14.5 13.1 11.7 11.3 10.9 7.1

78393 75499 76506 77007 73757

10.7 9.1 9.7 9.9 8.2 4.3

11837 11216 11474 11142 11035

-2.5 -11.9 -8.1 -13 -14.6 -24.0

51445 49183 47371 46553 44728

24.7 21.4 18.7 17.5 14.7 8.2

81155 87381 86422 86786 79072

12.1 15 14.6 14.8 11 4.7

12349 11744 11358 11122 10797

5.5 -4 -9.8 -13.3 -18.1 -25.4

57133 52444 49868 47814 45093

32.5 26.1 22.4 19.4 15.2 10.1

85370 89198 78025 79250 99614

14.1 15.9 10.5 11.1 20.4 3.6

10728 11325 10892 10832 11158

-19.1 -10.3 -16.7 -17.6 -12.8 -23.1

46895 46184 46098 45690 43882

18 16.9 16.8 16.2 13.3 6.8

79264 80426 81381 76980 72738

11.1 11.7 12.2 9.9 7.6 4.5

Sharekhan

September 21, 2011

Mutual Funds

mutual gains

DSP Blackrock Top 100 Equity Fund

Fact sheet DSP Merrill Lynch Top 100 Equity Fund is a large-cap oriented fund which seeks to invest in the top hundred stocks by market capitalisation, listed in India. The fund would use top-down as well as bottom-up approach to select the best stocks and the fund allocation in equities can go up to 100% of the net assets.
Scheme performance
35% 30% 25% 20% 15% 10% 5% 0% -5% -10% -15% 6 Months -2.2% -2.6% -5.7% 1 Year -3.9% -6.7% -9.4% 3 Years 5 Years Since Inception 10.8% 6.7% 4.6% 14.3% 9.2% 8.0% DSP BlackRock Top 100 Equity Fund - Grow th Large-cap Category Average BSE100 30.1% 22.6%

Key features Fund category Launch date Minimum investment Load structure Fund manager Latest NAV (Growth) Latest NAV (Dividend) Expense ratio AUM (June 2011) Benchmark Index
Holding by market cap Particular BSE Sensex BSE Midcap
Returns < 1 yr: Absolute, >1yr: CAGR

: Large Cap Funds : 10-Mar-03 : Rs5,000 : Entry: 0%, Exit: 1% if redeemed within 1 year : Apoorva Shah : Rs92.93 : Rs19.72 : 1.84% (31-Jul-11) : Rs1,553.08 crore : BSE 100

% 55.7 --90.7 30.5 49.1

BSE Small cap Benchmark (BSE100) Top 5 holdings Top 10 holdings

Style box analysis

Large Cap Mid Cap Small Cap
Growth Blend Value

Top 10 stock holdings Company name HDFC Bank Housing Development Finance Corporation Hindustan Unilever
12.6% 12.1% 11.8% 9.8% 7.2%

% of net assets 7.9 6.9 6.1 4.9 4.6 4.3 4.2 3.5 3.3 3.3

Top 5 sectors
Petroleum, Gas and petrochemical products FMCG Banks Pharmaceuticals & Biotechnology Auto & Auto Ancillaries 0.0% 2.0% 4.0% 6.0%

Oil & Natural Gas Corpn Larsen & Toubro Bharat Petroleum Corporation Tata Consultancy Services Siemens Nifty Kotak Mahindra Bank

8.0% 10.0% 12.0% 14.0%

Scheme analysis
The fund has done pretty well over its lifespan of more than eight years. The scheme also performed well ahead compared to the category average and the benchmark BSE 100, over all time frames. In the past one year also the scheme dipped by just 3.86% while the BSE 100 fell by 9.37%. Being a typical large-cap oriented fund, DSP Blackrock Top 100s portfolio is made up of front-runners. It has consistently maintained assets in large-cap stocks. It has managed this even as it has focused predominantly on stocks that comprise the benchmark index. The fund manager does not buy and hold stocks for a long period. Rather, he believes in picking undervalued stocks and exiting from the same as soon as the target is achieved. This is visible from the high portfolio turnover ratio. The fund has a fairly well maintained portfolio of about 40 stocks. The sector selection of the fund is also quite active. The sector allocation of the fund has been slightly concentrated in a few sectors. Currently, the top five sectors account for 53.43%; oil & gas, petroleum, gas & petrochemical products, and banks have been in focus for some time now. The allocation to the fast moving consumer goods (FMCG) sector has increased substantially since the past twelve months looking at the bitter performance of the markets.

Sharekhan

September 21, 2011

Mutual Funds

mutual gains

SBI Magnum Global Fund 94

Fact sheet SBI Magnum Global 94 intends to create a portfolio that is substantially constituted of equity and equity-related securities of large, mid-cap and small-cap companies.
Scheme performance
20% 15% 10% 5% 0% -5% -10% -15% -20% 6 Months -2.2%-1.0% 1 Year -1.7% -9.3% -16.0% 3 Years 5 Years 0.0% Since Inception 10.4% SBI Magnum Global Fund 94 - Grow th Multi-cap Category Average 12.8% 8.8% 8.6% CNX Midcap 13.7%

Key features Fund category Launch date Minimum investment Load structure Fund manager Latest NAV (Growth) Expense ratio AUM (June 2011) Benchmark Index
Holding by market cap Particular BSE Sensex BSE Midcap BSE Small cap % 2.1 65.4 4.9 22.9 22.0 39.1

: Multi Cap Funds : 30-Sep-94 : Rs2,000 : Entry: 0%, Exit: 1% if redeemed within one year. : Rama Iyer Srinivasan : Rs56.05 : 2.05% (31-Jul-11) : Rs537.47 crore : CNX Midcap

10.6% 11.1% 9.4%

Latest NAV (Dividend) : Rs26.36

Returns < 1 yr: Absolute, >1yr: CAGR

Style box analysis

Large Cap Mid Cap

Benchmark (CNX Midcap) Top 5 holdings Top 10 holdings

Top 10 stock holdings

Small Cap
Growth Blend Value

Company name Page Industries Blue Dart Express Redington India Bosch
17.5% 13.6% 6.5% 6.0% 5.7%

% of net assets 4.6 4.6 4.4 4.2 4.1 3.9 3.6 3.3 3.3 3.1

Top 5 sectors
Auto & Auto Ancillaries Pharmaceuticals & Biotechnology Transportation, Supply Chain and Logistics Services Softw are and Consultancy Services Food & Food Processing, Beverages

MRF Greaves Cotton Muthoot Finance Lupin Bajaj Holdings & Investment CRISIL

0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0%

Scheme analysis
SBI Magnum Global Fund 94 has outperformed its benchmark, CNX Midcap Index, and peers in the multi-cap fund category by a huge margin over different time frames. Over the past three years, the fund delivered 12.78% returns (at compounded annual growth rate) whereas the CNX Midcap and the category on an average both grew by about 8.5%. Over the shorter time frame of the last one year also, the fund has very well managed to contain losses to 1.69% while the benchmark index lost 16% and the category on an average lost 9.41%. SBI Magnum Global 94 has moved from large-cap stocks bias to multi-cap theme in 2004. Now the fund diversifies the portfolio over all the large, mid and small-cap companies. So far the move has paid dividends. The fund manager has growth stocks with specific focus on emerging blue-chips, displaying sustainable high growth rates. The fund maintains a portfolio of about 41 scrips while the exposure to any single scrip has gone up till 8% of the net assets. The sector picks are also not very conventional; currently the banking sector accounts for a meager 4.15% while automobile and automobile ancillaries sectors account for 17.52% of the net assets.

Sharekhan

September 21, 2011

Mutual Funds

mutual gains

Disclaimer: Mutual fund investments are subject to market risk. Please read the offer document carefully before investing. Past performance may or may not be sustained in the future.

Disclaimer
This document has been prepared by Sharekhan Ltd.(SHAREKHAN) This Document is subject to changes without prior notice and is intended only for the person or entity to which it is addressed to and may contain confidential and/or privileged material and is not for any type of circulation. Any review, retransmission, or any other use is prohibited. Kindly note that this document does not constitute an offer or solicitation for the purchase or sale of any financial instrument or as an official confirmation of any transaction. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. SHAREKHAN will not treat recipients as customers by virtue of their receiving this report. The information contained herein is from publicly available data or other sources believed to be reliable. While we would endeavour to update the information herein on reasonable basis, SHAREKHAN, its subsidiaries and associated companies, their directors and employees (SHAREKHAN and affiliates) are under no obligation to update or keep the information current. Also, there may be regulatory, compliance, or other reasons that may prevent SHAREKHAN and affiliates from doing so. We do not represent that information contained herein is accurate or complete and it should not be relied upon as such. This document is prepared for assistance only and is not intended to be and must not alone betaken as the basis for an investment decision. The user assumes the entire risk of any use made of this information. Each recipient of this document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views expressed may not be suitable for all investors. We do not undertake to advise you as to any change of our views. Affiliates of Sharekhan may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject SHAREKHAN and affiliates to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. SHAREKHAN & affiliates may have used the information set forth herein before publication and may have positions in, may from time to time purchase or sell or may be materially interested in any of the securities mentioned or related securities. SHAREKHAN may from time to time solicit from, or perform investment banking, or other services for, any company mentioned herein. Without limiting any of the foregoing, in no event shall SHAREKHAN, any of its affiliates or any third party involved in, or related to, computing or compiling the information have any liability for any damages of any kind. Any comments or statements made herein are those of the analyst and do not necessarily reflect those of SHAREKHAN.

Sharekhan

September 21, 2011