SBI Funds Management Limited · NSE:SBIFUNDS
SBI Funds Management — SBI Funds Management Private — Investor Presentation (March 2011)
38 slides from SBI Funds Management's investor presentation, March 2011
Slide 1: A joint venture between SBI and Société Générale Asset Management
A joint venture between SBI and Société Genéralé Asset Management
Slide 2: Flow of the Presentation
Flow of the Presentation Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 3: Indian Investor Investment Pattern
Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 4: Financial savings of Household Sector
Financial savings of Household Sector Savings skewed towards Bank Deposits however there is tilt towards Risk Source: RBI Data
Slide 5: Indian Investor: Investment pattern
Indian Investor: Investment pattern Risk averse investors Most of the investible surplus goes into bank and post office deposits Prefers to “Play Safe” and invest in debt instruments Still aspires for higher returns Reasons for such paradox Equity market – volatile, high risk - high returns trad
Slide 6: Indian Market Scenario
Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 7: Indian Market at a glance
Indian Market at a glance Above charts are for the illustration purpose only. Past performance may or may not be sustained in future. Source: Bloomberg, MFI Explorer
Slide 8: Indian Markets: An Eventful Calendar Year 2010
Indian Markets: An Eventful Calendar Year 2010 Sensex delivers 18% returns Commodity Strongest price rise FII flow Gold Upswing RBI rate normalization Strong GDP growth
Slide 9: Life under current market….
SBI - CAPITAL AS yields are up ; As volatility has increased >po1mu1vAL FUND SBI Funds Management Private Limited (A joint venture between SBI and Société Générale Asset Management). A PARTNER FOR LIFE
Slide 10: Capital Protection
Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 11: Investors need: Capital Protection
Investors need : Capital Protection Steady returns Returns with Volatility Capital Protection Oriented Fund A product that can captures the best of both the “worlds” “Optimizing returns without putting at risk the capital invested”
Slide 12: How Capital is Protected?
How Capital is Protected? Returns Equity “Performance booster” 0% to 26% Equity Capital Invested “Capital Protection through hold- Debt 74% to 100% Debt to-maturity debt instruments” 5 year horizon The structure of the portfolio is oriented towards protection of the original The fund’s structure inv
Slide 13: Example 1: If equity markets appreciate by 15% pa
Example 1: If equity markets appreciate by 15% pa… After 5 Years Rs. 167.20 Equity = 52.30 Initial Investment Rs 26 at 15% Rs. 100 Equity Rs 26 Debt = 114.91 Debt Rs 74 at 9.20% Rs 74 If equity markets appreciate by 15% pa, portfolio gives 10.83% CAGR Above calculation is for the illustration purpos
Slide 14: Example 2: If equity markets remains flat
Example 2: If equity markets remains flat… After 5 Years Rs. 140.91 Equity = 26 Initial Investment Rs 26 at 0% Rs. 100 Equity Rs 26 Debt = 114.91 Debt Rs 74 at 9.20% Rs 74 If equity markets remains flat, portfolio gives 7.10% CAGR Above calculation is for the illustration purpose only. Expenses has
Slide 15: Example 3: If the equity markets depreciates by 15% pa
Example 3: If the equity markets depreciates by 15% pa… After 5 Years Rs. 126.44 Equity Initial Investment = 11.54 Rs. 100 Rs 26 at -15% Equity Rs 26 Debt = 114.91 Debt Rs 74 at 9.20% Rs 74 If the equity markets depreciates by 15% pa, portfolio gives 4.80% CAGR Above calculation is for the illustrat
Slide 16: In a nut shell: SCPOF II portfolio
In a nut shell: SCPOF II portfolio Equity Portfolio* • Diversified portfolio • Cap of 10% on the exposure of any stock Debt Portfolio • High quality debt papers • No interest rate risk because of matching maturity * Investment will be made in stocks listed on NSE and BSE having a market cap equal to
Slide 17: Why invest in Capital Protection Oriented products?
Why invest in Capital Protection Oriented products? Quality Debt Portfolio High quality 5 year debt securities to minimize credit risk & matching maturity reduces interest rate risk Return Potential Equity asset class will be actively managed Tax Advantage Avail indexation benefits & thereby potenti
Slide 18: Is Capital always protected?
Is Capital always protected? Value of Rs. 100 invested in SCPOF 200 180 160 Amount at maturity (Rs.) Capital 140 Protection 120 100 80 60 40 20 0 -20 -10 0 5 10 20 CAGR returns in equity (%) Structure of the portfolio is oriented towards protection of capital
Slide 19: How is it different?
How is it different ? Protection Return Protection Return Protection Return
Slide 20: Tax Efficiency
Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 21: Tax Efficiency
Tax Efficiency SBI Capital Protection Oriented Fund Debt 74%( @ 9.20% p.a.) & Equity 26% Equity market grows Equity market grows Equity market Equity markets falls Scenario at 20% p.a. at 10% p.a. remains flat by 10% p.a. Initial Investment (Rs.) 10000 10000 10000 10000 Amount at Maturity 17960 1567
Slide 22: SBI Capital Protection Oriented Fund Series II
Rated mfAAA (SO) by ICRA SBI Capital Protection Oriented Fund Series II Tax Efficiency Capital Protection Indian Market Scenario Indian Investor Investment Pattern
Slide 23: Investment Objective & Asset Allocation
Investment Objective & Asset Allocation Investment Objective: The primary objective of the scheme is to protect the capital invested (face value of Rs. 10 per unit) on maturity of the scheme through focused investments in equity, debt and money market instruments at the same time also seeking to pro
Slide 24: Portfolio Construction
Portfolio Construction Total Investment Hold to maturity fixed income bonds maturing in line Listed equity securities, with tenure of the fund fixed income instruments Only stocks having market PSU Bonds, AAA Rated bonds with 100 bps spread capitalisation above the last above or below the valuation
Slide 25: Active Management – Equity Component
Active Management – Equity Component
Slide 26: Top Down Approach for stock bets
Top Down Approach for stock bets Economic Qualitative Liquidity Interest Rates Regulation Growth Factors Flows Macro Outlook Demand- Business Profitability Pricing Supply Cycle Sector Allocation Business Mgmt Valuations Model Stock Selection
Slide 27: Focus Themes
Focus Themes Consumer Discretionary Healthcare IT
Slide 28: Sector Picks: Consumer Discretionary
Sector Picks: Consumer Discretionary 150 140 Index price movement 130 120 110 100 90 80 70 60 50 BSE 100 BSE FMCG Consumption sector to reap benefits: Resilient domestic economy and negative real interest rates continue to boost consumer spending. Rural upliftment Rural Income not completely d
Slide 29: Sector Picks: Healthcare
Healthcare 160 150 Index Price Movement 140 130 120 110 100 90 80 70 60 50 BSE 100 BSE Healthcare With multiple growth drivers (US, emerging markets, domestic demand) playing out simultaneously, it is expected that earnings trajectory would be strong & return ratios robust. Cost advantage and qu
Slide 30: Sector Picks: Information Technology
Information Technology 150 140 Index Price Movement 130 120 110 100 90 80 70 60 50 BSE 100 BSE IT Recovery in tech spending in US Expectation of weak INR relative to USD Increasing market share of Tier I Indian vendors Relatively Higher predictability of growth Source: Bloomberg. Data as on
Slide 31: Risks of investing in the fund
Risks of investing in the fund • Hold to maturity component – Credit Risk – Reinvestment risk • Active management component – Geo-political risk – Economic risk – Markets may give negative returns for next 5 years – Illiquidity in stocks
Slide 32: Fund Features
Fund Features • 5 - Year Close – Ended Capital Protection Oriented Fund • Fund Manager - Rajeev Radhakrishnan & R Srinivasan • Minimum investment: Limits Rs. 5000 and in multiples of Re. 1 thereafter. • Options: Only Growth • NAV to be disclosed on every calendar day • Liquidity – Only at maturity,
Slide 33: Capital Protection – In Nutshell
Capital Protection – In Nutshell
Slide 34: Target Investor
Target Investor Investors with low to medium risk profile High net worth individuals PF, trusts etc. looking to invest in equity markets but requires capital protection as well First time mutual fund investors who would like to enjoy the debt returns with an additional equity upside All in
Slide 35: SBI Funds Management Overview
SBI Funds Management Overview SBI Funds management has been expert in managing assets since 1993. At the end of December 2010, SBIFM: – is managing more than INR 45,000 crores through mutual funds, PMS, & offshore business – has won the trust of more that 60 lakh investors – has been promoted among
Slide 36: Extensive Coverage in India: Investor Service Centers
Extensive Coverage in India : Investor Service Centers • 15 regions • 29 Investor Service Centres • 66 Investor Service Desks • 8 Investor Service Associate • 5 Investor Service Points dedicated for big metros • 1 Overseas office in Dubai Over 100 Points of Presence and 500 points of sales trough pa
Slide 37: Disclaimer
Disclaimer Name of Scheme: SBI Capital Protection Oriented Fund – Series II. Type of Scheme: A five year close ended capital protection oriented fund. Investment Objective: The primary objective of the scheme is to protect the capital invested (face value of Rs. 10 per unit) on maturity of the schem
Slide 38: Thank You
a © THANK YOU ©. SBIMUTUAL FUND A SBI Funds Management Private Limited (A joint venture between SBI and Société Générale Asset Management). 60 PARTNER FOR LIFE
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