Prudent Corporate Advisory Services Limited · NSE:PRUDENT
Prudent Corporate Advisory Services — SBI Funds Management Private — Investor Presentation (March 2012)
11 slides from Prudent Corporate Advisory Services's investor presentation, March 2012
Slide 1: Budget and Markets March 2012
Budget and Markets March 2012 SBI FUNDS MANAGEMENT PRIVATE LIMITED (A joint venture between SBI & AMUNDI)
Slide 2: Union Budget - A Balanced move towards consolidation
Union Budget- A Balanced move towards consolidation Consolidation driven by revenue growth Tax Revenue growth driven by roll back of fiscal stimuli Revenue growth % yoy, Expenditure growth % yoy Net Tax Revenues (Rs B) - LHS Revenue Reciepts Expenditure Net Tax Revenue as a % of GDP - RHS 40 8,250 9
Slide 3: Macro Uncertainties still exist
Macro Uncertainties still exist Targeted fiscal consolidation Growth remains the critical peg Fiscal Deficit (% to GDP), Revenue Deficit (% to GDP) Nominal growth , % yoy Nominal GDP growth (% yoy) Fiscal Deficit (% to GDP) Revenue Deficit (% to GDP) 22.0% 7.0 20.0% 6.0 18.0% 5.0 16.0% 14.0% 4.0 12.
Slide 4: In a nutshell: Union Budget 2011-12
In a nutshell: Union Budget 2011-12 … • Incremental move towards Fiscal consolidation • Budget falls short on expected structural reforms with GST, DTC, FDI in Retail etc left to intent than action • Investment led budget with a gradual roll back of Fiscal Stimuli. Excise & custom duty rate hiked. S
Slide 5: Union Budget - Sectoral Impact
Union Budget- Sectoral Impact Sector Budget Proposal Analysis Outlook (+/-) Same as DTC Standing Committee Negative at the margin for FY13 E, but was Premium / Sum Assured eligible for tax breaks recommendation. Impacts some Life Insurance expected under DTC & below earlier DTC reco of down from 20%
Slide 6: Union Budget - Sectoral Impact
Union Budget- Sectoral Impact Sector Budget Proposal Analysis Outlook (+/-) Hike in excise duty for 2W, 3W and small cars from 10% to 12% Negative but on expected lines. No Auto additional duty imposed on diesel vehicles Positive Duty on 1200 to 1500 cc cars from 22% to 24% is positive for the secto
Slide 7: Union Budget - Sectoral Impact
Union Budget- Sectoral Impact Sector Budget Proposal Analysis Outlook (+/-) Higher excise duty Negative for margins or demand Negative Higher custom uty on imported flat steel to 7.5% Positive for domestic producers as it alleviates Metals and mining positive from 5% the threat of higher imports Pos
Slide 8: Equity markets likely to consolidate gains
Equity markets likely to consolidate gains… 28 fwd PE Mean • Budget turned out to be a non-event for the equity 24 markets with no major structural reforms 20 announced. +1 Std Dev. 16 • Market to watch out for incremental news flow on 12 -1 Std Dev. global economic developments, movement in crude o
Slide 9: Credit Curves - Pressure on yields in near term
Credit Curves- Pressure on yields in near term • The Government Borrowing through dated securities for FY13 is higher than market anticipation leading to a sell off in bond yields FY12-Rs Crs FY13-Rs Crs %Increase Gross Borrowings-Dated • Net Borrowing through dated securities is Rs 4,79,000 crs Sec
Slide 10: Fixed Income Funds Strategy - Long Term Funds
Fixed Income Funds Strategy- Long Term Funds • Bond yields continue to be influenced by the OMO announcements. Softness in recent macro economic numbers also provide anticipation on more aggressive monetary actions. • With the policy rates peaking , we expect near term policy actions to aggressively
Slide 11: Disclaimer
Disclaimer Past performance is no guarantee of future results. Risk Factors: Mutual Funds and Securities Investments are subject to market risks and there is no assurance or guarantee that the objective of scheme(s)/plan(s) will be achieved. As with any other investment in securities, the NAV of the
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