Birla Sun Life Emerging Leaders Fund - Series 6 Emerging Leaders Fund... · ... Birla Sun Life Asset Management Company Ltd. Mutual Fund investments are subject to market risks, read

Copyright: Birla Sun Life Asset Management Company Ltd.

Mutual Fund investments are subject to market risks, read all Scheme related documents carefully.


Birla Sun Life Emerging Leaders Fund - Series 6(A Close ended Equity Scheme)

“Unlock the potential of your investment in the right business cycle”



This product is suitable for investors who are seeking:

•Long term capital growth

•A close ended scheme with investments in equity and equity related securities predominantly in Small & Mid cap companies

•High Risk (BROWN)

Equities over the long term

Why Mid and Small caps?

Birla Sun Life Emerging Leaders Fund - Series 6

Investors should consult their financial advisers if in doubt whether the product is suitable for them.

Birla Sun Life Emerging Leaders Fund – Series 6

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Mutual Fund investments are subject to market risks, read all Scheme related documents carefully. 3

Returns calculated till 31st Dec 2014 for all asset classes except for property which is calculated as on 30th Sep 2014

Source: RIMES, Bloomberg, JLLM, HDFC, Morgan Stanley Research

Equities continues to be the Outperformer over long-term

-7

10

14

9

15

76 7

9 8 8 8

5

9

15

7

29

11

17

13

1Y Return 5Y CAGR 10Y CAGR 20Y CAGR

Returns % Across Asset Classes (Pre-tax)

Gold (INR) 10-year treasuries Bank Fixed Deposits Property (across 7 cities) Equities (BSE Sensex)



Visible through Long Term Performance

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Index

3 years* Last 5 years* Boom Period Crisis Period

CAGR % Value of Rs 1 lakh CAGR % Value of Rs 1 lakhMay 2004-Nov

2007Nov 2008-Aug

2013

S&P BSE Sensex 18.07%164,596

21.16% 177,851 49% 15%

S&P BSE Midcap 19.18%169,278

19.11% 168,987 54% 12%

S&P BSE Small-Cap 18.17%165,009

11.95% 140,312 66% 9%

Source: MFI Explorer, Bloomberg; *Returns as on 28 Feb 15

0

200

400

600

800

1000

1200

1400

1600

Feb

-04

Feb

-05

Feb

-06

Feb

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Feb

-08

Feb

-09

Feb

-10

Feb

-11

Feb

-12

Feb

-13

Feb

-14

Feb

-15

BSE Smallcap BSE Mid-Cap BSE Sensex

1268

987

1135







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Indian Market Analysis

-30

-20

-10

0

10

20

30

40

50

Mar

-12

Jun

-12

Sep

-12

Dec

-12

Mar

-13

Jun

-13

Sep

-13

Dec

-13

Mar

-14

Jun

-14

Sep

-14

Dec

-14

S&P BSE MID CAP S&P BSE Sensex S&P BSE SMALL CAP

Midcaps have outperformed Large caps over a time period and thus rewarded

investors for additional risk

Note: 3 Year Rolling Return on a Quarter Basis; Source: MFI Expl

8.8

3.8

3.3



Midcaps have higher potential to generate better

returns than Large Caps

They are Under researched Limited research coverage for this segment compared to large caps by various institutions

In depth research on live basis available currently for only top 176* companies; beyond this sporadiccoverage only available

Little is known about hidden gems; creating information arbitrage

They are Under Owned Institutional ownership is much lower than that of Large caps

Primarily owned by promoters

Liquidity is limited; creating arbitrage

They are Under Valued Because of low awareness levels, investor interest is also low

Due lack of demand, lower valuations

Price tends to be lower than intrinsic value; creating valuation arbitrage

Potential Superior Growth

Re – rating on

improving investor

awareness & interest

Multiplier effect on

valuations *Note: Researched stocks indicatecoverage of more than 5 brokinghouses; Source: MoSL



Eicher Motor

One of the leading manufacturers of commercial vehicles with a market leading position in the 7 to 11 tonnes segments

In CY14 highest ever net income from operations , record EBIT margins and strong volume growth in its main brandRoyal Enfield(RE)

Market share in light/medium duty CVs improved to 32.6% in CY14

Targets to invest INR10b in FY16 (15 months), of which INR5b will be in RE segment

Aims to increase its marketing spends to expand its addressable market in terms of customer profile and geography

Amara Raja Battery

Engaged in manufacturing and automotive batteries; key products include Batteries, Un interruptible Power Systems ,

Strong volume growth of ~20% CAR is expected on both auto[Original Equipment Manufacturer (OEM ) andreplacement ]and industrial segment on back of timely steep capacity expansion

Manufacturing Inverter business to contribute 7% of overall revenue in FY17

Berger Paints

One of the largest player in Indian decorative paints segment with a market share of ~16-17%

Improved its gross margin by 240 bps yoy and 380 bps in 3Q FY15, on back of rise in sales of higher margin product andlower price of crude-based raw material (40% of RM, which is 61% of Sales)

The paints industry is expected to grow to Rs 50000 cr by FY 17 with a continued shift towards organized segment

Some of our stock picks in the Midcap Space..

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Disclaimer: Stocks mentioned above may not be a part of the portfolio







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A 3.5-year closed ended equity fund with objective to generate long term capital

appreciation

The Scheme endeavours to follow bottom up approach of investing without any sectoral

bias but favoured towards small and mid caps

Invests in equity and equity-related securities of small and mid cap companies that have a

potential to rerate in the next 3-5 years

The investment emphasis would be on identifying high growth top-line and bottom-line

companies with sound corporate managements

Intends to play broader long term economic recovery and help generate alpha

Birla Sun Life Emerging Leaders Fund – Series 6Scheme Attributes

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Asset Allocation Pattern* Risk Profile

Normal Allocation

(% of total Assets)

Equity and Equity related securities Of which…

Small Caps and Mid caps : 60 – 100%

Other than Small &Midcaps: 0 – 40%

High

80-100%

Cash, Money Market & Debt instruments Low 0-20%

*For further details please refer the SID & KIM of the Scheme



Birla Sun Life Emerging Leaders Fund Series 6Key tenets

Birla Sun Life Emerging Leaders Fund Series 6 strives to play a theme of a complete market cycle

Strong portfolio construction process i.e. Bottom up oriented gaining from a top downperspective on various sectors/companies to understand their placement in their respectivegrowth/business cycle:

Top Down Approach is predominantly followed with significant and continuous efforts madeon evaluating global and India macro trends, on the basis of which an overweight/ underweightstance on the businesses/sub industries level can be taken

Bottom up stock picking is used to pick stocks where risk reward is hugely in favour to takeadvantage of mispriced opportunities. The stock will be included in the portfolio only after acertain level of conviction on its ability to construct ROE/ROA and growth in its topline andbottomline

The fund will strive to maintain a High Small and Midcap Allocation to enable higher alphageneration over peer group & benchmark over a longer term on account of rerating andmispricing of growth

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Investment Universe

The Universe seek to include sectors which are beneficiaries of the economic recovery andchanging business environment like:

– Banking and Finance

– Auto and Auto Ancillaries,

– Capital Goods

– Infrastructure

– Pharmaceuticals etc.

The below chart shows the contribution(CAGR) of the sectors included in our InvestmentUniverse vis-a-vis S&P BSL Midcap Index (CAGR of 18.8%) in the last 3 years

12

4340

25 2421

0

10

20

30

40

50

Auto & Auto Ancil Capital Goods Banks - Pvt Infrastructure Healthcare

Performance of the Sectors in the last 3 years*

*Note: CAGR Perform for the period Mar’12 – Mar’15; Source: MoSL

18.8%



Name of the Scheme


Structure A Close Ended Equity Scheme

Benchmark S&P BSE Midcap Index

Investment Objective

The primary objective of the scheme is to generate long-term capital appreciation byinvesting predominantly in equity and equity related securities of small & Mid capcompanies.

LiquidityThe scheme will have duration of 3.5 years from and including the date of allotment. The units offered under the Scheme will be listed on NSE within 5 (five) Business days from the date of allotment.

Load StructureEntry Load: Nil

Exit Load: Nil, No redemption/repurchase of units shall be allowed prior to the maturity of the scheme. Investors wishing to exit may do so through stock exchange mode

Plans/ Options

The Scheme will have Regular Plan and Direct Plan with a common portfolio and separateNAVs. For further details, refer SID and KIM of the Scheme.

Each of the above (Regular and Direct) Plan under the scheme will have the followingOptions: (1) Growth Option and (2) Dividend Option with Payout Facility

Minimum Application Amt

Minimum of Rs. 5,000/- and in multiples of Rs. 10/- thereafter during the New Fund Offer period.

Scheme features

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Risk Factors: Small & Mid cap stocks may be more volatile & less liquid than large cap companies. Investorstherefore should assume that illiquidity risks are higher in this Scheme than in a normally diversified equityfund. Thus, relative to larger, more liquid stocks, investing in small & mid cap stocks, involves potentiallygreater volatility and risk.

Risk Control Strategies: Since investing requires disciplined risk management, the AMC would incorporateadequate safeguards for controlling risks in the portfolio construction process. The risk control processinvolves reducing risks through portfolio diversification, taking care however not to dilute returns in theprocess. The AMC believes that this diversification would help achieve the desired level of consistency inreturns. The AMC may also implement certain internal control procedures / risk & exposure limits etc., whichmay be varied from time to time.

The AMC aims to identify securities, which offer superior levels of yield at lower levels of risks. With the aim of controlling risks, rigorous in-depth credit evaluation of the securities proposed to be invested in will be carried out by the investment team of the AMC.

While these measures are expected to mitigate the above risks to a large extent, there can be no assurancethat these risks would be completely eliminated.

Scheme specific risk factors & Risk Control Strategies

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DISCLAIMER CLAUSE OF NSE: It is to be distinctly understood that the permission given by National Stock Exchange

of India Limited (NSE) should not in any way be deemed or construed that the Scheme Information Document has been

cleared or approved by NSE nor does it certify the correctness or completeness of any of the contents of the Draft

Scheme Information Document. The investors are advised to refer to the Scheme Information Document for the full text

of the 'Disclaimer Clause of NSE'

Disclaimers: This document is strictly confidential and meant for private circulation only.The document is solely for the

information and understanding of intended recipients only. If you are not the intended recipient, you are hereby notified

that any use, distribution, reproduction or any action taken or omitted to be taken in reliance upon the same is

prohibited and may be unlawful. Wherever possible, all the figures and data given are dated, and the same may or may

not be relevant at a future date. Further the opinions expressed and facts referred to in this document are subject to

change without notice and BSLAMC is under no obligation to update the same. While utmost care has been exercised,

BSLAMC or any of its officers, employees, personnel, directors make no representation or warranty, express or implied,

as to the accuracy, completeness or reliability of the content and hereby disclaim any liability with regard to the same.

Recipients of this material should exercise due care and read the scheme information document (including if necessary,

obtaining the advice of tax/legal/accounting/financial/other professional(s) prior to taking of any decision, acting or

omitting to act. Further, the recipient shall not copy/circulate/reproduce/quote contents of this document, in part or in

whole, or in any other manner whatsoever without prior and explicit approval of BSLAMC.

MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED

DOCUMENTS CAREFULLY

Mutual Fund: Birla Sun Life Mutual Fund

Asset Management Company/ Investment Manager: Birla Sun Life Asset Management Company Limited

Registered Office: One India Bulls Centre, Tower - 1, 17th Floor Jupiter Mill Compound, 841, SB Marg, ElphinstoneRoad, Mumbai 400013 CIN: U65991MH1994PLC080811

Disclaimers

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THANK YOU

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Birla Sun Life Emerging Leaders Fund - Series 6 Emerging Leaders Fund... · ... Birla Sun Life Asset Management Company Ltd. Mutual Fund investments are subject to market risks, read