Letter to Investors of ICICI Prudential Bharat Consumption

1

Letter to Investors of ICICI Prudential Bharat Consumption Fund – Series 1

Date: September 27, 2021

Proposed merger of ICICI Prudential Bharat Consumption Fund – Series 1 into ICICI

Prudential Bharat Consumption Fund

Dear Investor,

We thank you for your investments in ICICI Prudential Bharat Consumption Fund – Series 1 (the

Merging Scheme).

ICICI Prudential Bharat Consumption Fund – Series 1 (the Merging Scheme) with inception date

of April 11, 2018, is a close-ended equity oriented scheme that seeks to provide capital

appreciation by investing predominantly in equity and equity related instruments of sectors that

could benefit from growth in consumption and related activities.

ICICI Prudential Bharat Consumption Fund (Surviving Scheme) with inception date of April 12,

2019 is an open-ended equity oriented scheme which has an objective to generate long-term

capital appreciation by investing primarily in Equity and Equity related securities of companies

engaged in consumption and consumption related activities or allied sectors.

We continue on our journey of striving to bridge the gap between savings and investments to

help create long term wealth and value for our investors. The investors are requested to note that

the Board of Directors of ICICI Prudential Asset Management Company Limited (the AMC),

Investment Manager to the schemes of ICICI Prudential Mutual Fund (the Mutual Fund) and ICICI

Prudential Trust Limited (the Trustee), Trustees to the Mutual Fund have approved the merger of

ICICI Prudential Bharat Consumption Fund – Series 1 into ICICI Prudential Bharat Consumption

Fund.

Securities and Exchange Board of India has vide its communication dated September 21, 2021,

given its no-objection to the merger of ICICI Prudential Bharat Consumption Fund (Surviving

Scheme) with ICICI Prudential Bharat Consumption Fund – Series 1 (Merging Scheme).

As an investor in the Scheme, we would like to share with you the details of the proposed merger

so that you can take an appropriate and informed decision. The proposed merger will be effective

from closure of business hours of November 01, 2021.

Investors are further requested to note that the provisions pertaining to “Segregated Portfolio”

and “Writing of Covered Call Strategy” shall be applicable to the Surviving scheme with effect

from effective date of merger of ICICI Prudential Bharat Consumption Fund and ICICI Prudential

Bharat Consumption Fund – Series 1 i.e. closure of business hours of November 01, 2021. Details

of change in ICICI Prudential Bharat Consumption Fund are attached as Annexure A.

Rationale for merger of ICICI Prudential Bharat Consumption Fund – Series 1 and ICICI

Prudential Bharat Consumption Fund:

The investment objective of ICICI Prudential Bharat Consumption Fund Series – 1 (Merging Scheme)

is similar to the objective of the ICICI Prudential Bharat Consumption Fund (Surviving Scheme). ).

In order for the investors of the Merging Scheme to benefit from the prospects of the growth of

consumption sector in India, it is proposed to merge the Merging Scheme with Surviving Scheme

i.e. ICICI Prudential Bharat Consumption Fund. Further, an open-ended structure may provide

investors with an option to purchase and sale continuously at the applicable NAV giving investors

2

the opportunity to enter and exit at their discretion. It will help the investors with flexibility to extend

the holding period in order to benefit from the growth of the consumption space in India.

Growth of consumption sector in India:

India has been showing steady consumption growth for many years driven by strong socio-

demographic fundamentals like being the second largest population in the world, majority of

population in the working class category, etc. However, with Covid-19 pandemic hitting the country

in 2020, the factors driving consumption came under pressure putting hard brakes on the growth

rates.

With the economy revival in progress, India’s consumption is back on growth trajectory, supported

by the uptick in economy and other signs of recovery visible with factors like increasing GST

collections, increasing e-way bills and changes in consumer sentiments. India’s retail and

consumption sector is expected to bounce back at pre-covid levels. Below is the performance of

the Nifty India Consumption TRI Index for the last 5 Financial Years highlighting the revival of the

consumption in India.

Index Performance FY 17 FY 18 FY 19 FY 20 FY 21

Nifty India Consumption Index TRI 18.85 19.98 3.64 -14.78 52.24

The below graphical representation of the Nifty India Consumption TRI Index shows the impact of

Covid-19 on the consumption sector in March 2020 and the revival in the post-Covid period. From

Jan 01, 2020 to March 22, 2020 (pre-Covid), the index saw a fall of 26.17% whereas from March 23,

2020 to August 31, 2021, the index has seen an increase of 55.88% indicating signs of recovery.

Considering the above, it is expected that consumption in India may triple by 2030 which can benefit

the consumption sector/companies.

(Source: Boston Consulting Group’s report on Retail Resurgence in India – February 2021)

In this regard, please find below the relevant information about the Merging and Surviving

Schemes to facilitate you in taking an informed decision:

1. Portfolio of the Schemes along with their holding percentage as on August 31,

2021 is attached as Annexure B:

2. Performance of the Schemes as on August 31, 2021:

Compounded Annualised Returns (%) for last 1 year, 3 years, 5 years and since inception of the

Schemes along with the Benchmark returns:

4000

5000

6000

7000

8000

Jan

-20

Feb

-20

Mar

-20

Ap

r-2

0

May

-20

Jun

-20

Jul-

20

Au

g-2

0

Sep

-20

Oct

-20

No

v-2

0

Dec

-20

Jan

-21

Feb

-21

Mar

-21

Ap

r-2

1

May

-21

Jun

-21

Jul-

21

Au

g-2

1

Nifty India Consumption TRI

3

Scheme Name 1

Year

3

Years

5

Years

Since

Inception

Inception

Date

ICICI Prudential Bharat

Consumption Fund - Series 1 47.68 13.94 - 13.29 11-Apr-18


(Benchmark) 38.57 9.97 - 12.02


Consumption Fund 33.14 - - 13.38 12-Apr-19


(Benchmark) 38.57 - - 17.11

*Less than 1 year Simple Annualized returns, Greater than 1 year Compound Annualized returns.

Annual Returns (%) for last 5 financial years

Scheme/Benchmark FY 20-

21 FY 19-

20 FY 18-

19 FY 17-

18 FY 16-

17

ICICI Prudential Bharat Consumption Fund - Series 1

60.00 -19.92 - - -

Nifty India Consumption TRI 47.78 -14.88 - - -

ICICI Prudential Bharat Consumption Fund 42.50 - - - -

Nifty India Consumption TRI 47.78 - - - -

Graphical presentation of the annualized performance:

ICICI Prudential Bharat Consumption Fund – Series 1:

ICICI Prudential Bharat Consumption Fund:

FY 20-21 FY 19-20 FY 18-19 FY 17-18 FY 16-17

ICICI Prudential BharatConsumption Fund - Series 1

60.00 -19.92 0.00 0.00 0.00

Nifty India Consumption TRI 47.78 -14.88 0.00 0.00 0.00

-30.00-20.00-10.00

0.0010.0020.0030.0040.0050.0060.0070.00

Re

turn

(%

)

4

Notes:

*Less than 1 year Simple Annualized returns, Greater than 1 year Compound Annualized

returns

In case the start/end date of the concerned period is a non-business date (NBD), the NAV

of the previous date is considered for computation of returns. The NAV per unit shown in

the table is as on the start date of the said period.

Past performance may or may not be sustained in future and the same may not

necessarily provide the basis for comparison with other investment.

Different plans shall have different expense structure. The performance details provided

herein are of the Plans mentioned above.

Load is not considered for computation of returns.

For computation of since inception returns the allotment NAV has been taken as Rs. 10.

3. Investment Objective, Asset Allocation, Investment Strategy and main features of

the Surviving scheme:

The merger will not result in the emergence of any new scheme as ICICI Prudential Bharat

Consumption Fund – Series 1 will be merged in the Surviving Scheme, viz. ICICI Prudential Bharat

Consumption Fund. The tenure of the Merging Scheme is 1300 days from allotment date. Post-

merger, the investments under the Surviving Scheme will be in accordance with the investment

objective and asset allocation of the Surviving Scheme. The features of Merging and Surviving

Scheme are stated below for easy reference of the investors:

Provisions ICICI Prudential Bharat Consumption

Fund

ICICI Prudential Bharat Consumption

Fund – Series 1

Type of the

Scheme

An Open Ended Equity Scheme following

Consumption theme.

A Close Ended Equity Scheme following

Consumption Theme

Investment

Objective

To generate long-term capital appreciation by

investing primarily in Equity and Equity related

securities of companies engaged in

consumption and consumption related

activities or allied sectors.

However, there can be no assurance or

guarantee that the investment objective of the

scheme would be achieved.

The investment objective of the Scheme is to

provide capital appreciation by investing

predominantly in equity and equity related

instruments of sectors that could benefit from

growth in consumption and related activities.

However, there can be no assurance or

guarantee that the investment objective of the

Scheme would be achieved.

Asset

Allocation

Type of

Security

Indicative allocation (%

of total assets)

Risk

Profile

Instruments

Indicative allocations

(% of total assets)

Risk

Profile

FY 20-21 FY 19-20 FY 18-19 FY 17-18 FY 16-17

ICICI Prudential BharatConsumption Fund

42.50 0.00 0.00 0.00 0.00

Nifty India Consumption TRI 47.78 0.00 0.00 0.00 0.00

0.00

10.00

20.00

30.00

40.00

50.00

60.00

Re

turn

(%

)

5


Fund


Fund – Series 1

Maximum Minimum

Equity and

Equity

Related

Instruments

of companies

engaged in

consumption

and

consumption

related

activities or

allied

sectors*

100 80 High

Other equity

and equity

related

securities

20 0 Mediu

m to

High

Debt, Units of

debt Mutual

Fund

schemes and

Money

market

instruments

20 0 Mediu

m to

Low

Gold/Gold

ETF/Units

issued by

REITs/ InvITs

such other

asset classes

as may be

permitted by

SEBI from

time to time

(subject to

applicable

SEBI limits)

20 0 Mediu

m to

High

*Indicative list of sectors/industries falling

under consumption and consumption related

activities or allied sectors are as follows:

1. Automobile including auto components

companies,

2. Consumer Goods including consumer

durables, consumer non-durables, retailing

etc.

3. Energy,

4. Healthcare Services,

5. Media & Entertainment,

6. Pharma,

7. Services such as Commercial and

Engineering Services, Hotels Resorts and

Recreational Activities, Transportation,

Trading, etc.

8. Telecom,

9. Textiles

Maximum Minimum

Equity and

Equity

Related

Instruments

of companies

that could

benefit from

consumption

and related

activities and

are part of

sectors in the

benchmark

index

100% 80% High

Equity and

Equity

related

instruments

of companies

other than

the ones that

could benefit

from

consumption

and related

activities

20% 0% Medium

to High

Debt and

Money

Market

Instruments

20% 0% Low to

Medium

The Scheme may also take exposure to:

Derivative instruments upto 50% of the Net

assets of the Scheme. The Scheme may

invest in derivatives to engage in permitted

currency hedging transactions with an

intention to reduce exchange rate

fluctuations between the currency of the

Scheme (INR) and the foreign currency

exposure.

ADRs/ GDRs/ Foreign Securities/ Overseas

ETFs upto 50% of Net assets of the Scheme.

Investment in Foreign Securities shall be in

compliance with requirement of SEBI Circular

dated September 26, 2007 and other

applicable regulatory guidelines

Securitized Debt upto 50% of debt portfolio

Stock Lending upto 20% of its Net assets. The

Scheme shall also not lend more than 5% of

its net assets to any counter party.

The Scheme can invest in debt / money market

instruments, having residual maturity upto the

residual maturity of the Scheme.

6


Fund


Fund – Series 1

Please note that the above list is indicative and

the Fund Manager may add such other

sector/industries which satisfy the

consumption theme. The Fund Manager may

also add other sectors as may be added in Nifty

Consumption Index from time to time.

The Scheme may also take exposure to:

Derivative instruments upto 100% of the net

assets. Derivatives includes Index futures,

stock futures, Index Options and Stock

Options & such other derivative instruments

as permitted by SEBI from time to time.

ADR/GDR/ Foreign Securities to the extent

of 50% of net assets. Investment in

ADR/GDR/Foreign Securities would be as

per SEBI Circular dated September 26, 2007

and SEBI/IMD/CIR No. 122577/08 dated

April 8, 2008 and SEBI circular no.

SEBI/HO/IMD/DF3/CIR/P/2020/225 dated

November 5, 2020, as may be amended

from time to time.

Securitised debt upto 50% of debt portfolio

Stock lending up to 20% of net assets.

The Cumulative Gross Exposure across Equity,

Debt, Derivatives, Gold, REITs and INVITs and

ADR/GDR/foreign securities and such other

securities/assets as may be permitted by the

Board from time to time should not exceed

100% of the net assets of the scheme.

The Margin may be placed in the form of such

securities / instruments / deposits as may be

permitted/eligible to be placed as margin from

the assets of the Scheme. The securities /

instruments / deposits so placed as margin

shall be classified under the applicable

category of assets for the purposes of asset

allocation.

The Scheme will not engage in short selling

and repos in corporate bonds.

In the event of any deviation from the asset

allocation stated above, the Fund Manager

shall rebalance the portfolio within 30 days

from the date of such deviation. If owing to

adverse market conditions or with the view to

protect the interest of the investors, the fund

manager is not able to rebalance the asset

allocation within the above mentioned period

The Cumulative Gross Exposure to Equity, Debt

and Derivatives Positions will not exceed 100%

of the Net Assets of the Scheme.

The Scheme may invest in other schemes

managed by the AMC or in the schemes of any

other Mutual Funds, provided it is in conformity

with the investment objective of the Scheme

and in terms of the prevailing Regulations. As

per the Regulations, no investment

management fees will be charged for such

investments and the aggregate inter-scheme

investment made by all Schemes of the Fund or

in Schemes under the management of other

asset management companies shall not exceed

5% of the Net Asset Value of the Mutual Fund.

The Scheme does not intend to undertake/

invest/ engage in:

Repos in corporate debt securities

Short selling of securities

Credit default swaps

Equity Linked Debentures

Change in Investment Pattern

Subject to the Regulations, the asset allocation

pattern indicated above may change from time

to time keeping in view market conditions and

investment opportunities, applicable regulations

and political and economic factors.

In the event of asset allocation falling outside the

limits specified in the asset allocation table, the

fund manager will rebalance the same within 30

days. Though every endeavor will be made to

achieve the objectives of the Scheme, the

AMC/Sponsors/Trustee do not assure or

guarantee that the investment objectives of the

Scheme would be achieved.

If owing to adverse market conditions or with

the view to protect the interest of the investors,

the fund manager is not able to rebalance the

asset allocation within the above mentioned

period of 30 days, the same shall be reported to

the Internal Investment Committee. The Internal

Investment Committee shall then decide the

further course of action.

Provided further and subject to the above, any

change in the asset allocation affecting the

investment profile of the Scheme shall be

effected only in accordance with the provisions

7


Fund


Fund – Series 1

of 30 days, the same shall be reported to the

Internal Investment Committee and reasons

for the same shall be recorded in writing. The

internal investment committee shall then

decide on the future course of action.

It may be noted that no prior

intimation/indication would be given to

investors when the composition/asset

allocation pattern under the scheme undergo

changes within the permitted band as

indicated above or for changes due to

defensive positioning of the portfolio with a

view to protect the interest of the unit holders

on a temporary basis. The investors/unit

holders can ascertain details of asset allocation

of the scheme as on the last date of each

month on AMC’s website at

www.icicipruamc.com that will display the

asset allocation of the scheme as on the given

day.

Considering the inherent characteristics of the

Scheme, equity positions would have to built-

up gradually and also sold off gradually. This

would necessarily entail having large cash

position before the portfolio is fully invested

and during periods when equity positions are

being sold off to book profits/losses or to meet

redemption needs.

Investors may note that securities, which

endeavor to provide higher returns typically,

display higher volatility. Accordingly, the

investment portfolio of the Scheme would

reflect moderate to high volatility in its equity

and equity related investments and low to

moderate volatility in its debt and money

market investments.

The securities mentioned in the asset

allocation pattern could be privately placed or

unsecured. The securities may be acquired

through secondary market purchases, Initial

Public Offering (IPO), other public offers,

Private Placement, right offers (including

renunciation) and negotiated deals.

Change in Investment Pattern

Subject to the Regulations, the asset allocation

pattern indicated above may change from time

to time, keeping in view market conditions,

market opportunities, applicable regulations

and political and economic factors. Though

every endeavor will be made to achieve the

of sub regulation (15A) of Regulation 18 of the

Regulations, as detailed later in this document.

8


Fund


Fund – Series 1

objectives of the Scheme, the

AMC/Sponsors/Trustee do not guarantee that

the investment objectives of the Scheme will

be achieved.

Provided further and subject to the above, any

change in the asset allocation affecting the

investment profile of the Scheme shall be

effected only in accordance with the

provisions of sub regulation (15A) of

Regulation 18 of the Regulations, as detailed

later in this document.

Investment

Strategy

India is the second most populated country in

the world with over one billion population. And

it is set to reap what is now famously called the

demographic dividend; its working age

population being larger than the population

that is dependent on it. India’s 65% population

is below 35 years of age (Census 2011). With

Western Europe, the US, South Korea, Japan

and even China’s aging population, India could

reap the reward of demographic dividend. IMF

has stated in its report that India could add a

significant pace to its GDP growth rate due to

demographic dividend.

India hit ten-year high and stood first among

the 63 nations surveyed in the global consumer

confidence index with a score of 136 points for

the quarter ending December 2016.

Global corporations view India as one of the

key markets from where future growth is likely

to emerge. The growth in India’s consumer

market would be primarily driven by a

favourable population composition and

increasing disposable incomes.

India’s robust economic growth and rising

household incomes are expected to increase

consumer spending to US$ 4 trillion by 2025.

By 2025, India would rise from the 12th to the

5th largest position in the consumer durables

market in the world. The consumer durables

market in India is expected to reach US$ 20.6

billion by 2020. Demand growth is likely to

accelerate with rising disposable incomes and

easy access to credit. Increasing electrification

of rural areas and wide usability of online sales

would also aid growth in demand.

Source: Boston Consulting Group (BCG) – “The

New Indian: The Many Facets of a Changing

Consumer”

India is the second most populated country in

the world with a population of over one billion.

And it is set to reap what is now famously called

the demographic dividend; its working age

population being larger than the population that

is dependent on it. 65% of the population in

India is below 35 years of age (Census 2011).

With Western Europe, the US, South Korea,

Japan and even China’s aging population, India

could reap the reward of demographic dividend.

IMF has stated in its report that India could add

a significant pace to its GDP growth rate due to

demographic dividend.

India hit ten-year high and stood first among the

63 nations surveyed in the global consumer

confidence index with a score of 136 points for

the quarter ending December 2016.

Global corporations view India as one of the key

markets from where future growth is likely to

emerge. The growth in India’s consumer market

would be primarily driven by a favourable

population composition and increasing

disposable incomes.

India’s robust economic growth and rising

household incomes are expected to increase

consumer spending to US$ 4 trillion by 2025.

By 2025, India could rise from the 12th to the 5th

largest position in the consumer durables

market in the world. The consumer durables

market in India is expected to reach US$ 20.6

billion by 2020. Demand growth is likely to

accelerate with rising disposable incomes and

easy access to credit. Increasing electrification

of rural areas and wide usability of online sales

would also aid growth in demand.

Rising Income can be one of the key drivers for

growth in consumption in India over long term.

Of India’s five household income categories

(elite, affluent, aspirers, next billion, and

9


Fund


Fund – Series 1

ICICI Prudential Bharat Consumption Fund will

aim to capture this change in spending pattern.

The Scheme intends to invest predominantly in

Equities and Equity Related Securities of

companies that are likely to benefit directly or

indirectly from consumption and related

activities or allied sectors. These companies

may directly or indirectly benefit from increase

in consumption led demand.

Indicative list of sectors/industry falling under

consumption and consumption related

activities are as follows:

1. Automobile including auto components

companies,

2. Consumer Goods including consumer

durables, consumer non-durables, retailing

etc.

3. Energy,

4. Healthcare Services,

5. Media & Entertainment,

6. Pharma,

7. Services such as Commercial and

Engineering Services, Hotels Resorts and

Recreational Activities, Transportation,

Trading etc.

8. Telecom,

9. Textiles

Please note that the above list is indicative and

the Fund Manager may add such other

sector/industries which satisfy the

consumption theme. The Fund Manager may

also add other sectors as may be added in Nifty

Consumption Index from time to time.

The Scheme will predominantly invest in

companies, which, in the opinion of the Fund

Manager, offer an attractive investment

opportunity to participate in the growth of the

Consumption sector.

The scheme can also invest in equity & equity

related securities of other companies.

The scheme will follow a blend approach, a

combination of value and growth, to build the

portfolio. The scheme intends to invest in

stocks across large cap, midcap, small cap.

As and when the fund manager is of the view

that a specific investment has met its desired

objective and the investment is liquidated, the

proceeds may be distributed by way of

strugglers), the top two income classes are the

fastest growing. It is expected that, by 2025, the

share of elite and affluent households will

increase from 8% to 16% of the total while the

share of strugglers will drop from 31% to 18%.

Source: Boston Consulting Group (BCG) – “The

New Indian: The Many Facets of a Changing

Consumer” dated March 20, 2017.

ICICI Prudential Bharat Consumption Fund –

Series 1 will aim to capture this change in

spending pattern.

The Scheme intends to invest predominantly in

Equities and Equity Related Securities of

companies that are likely to benefit directly or

indirectly from consumption and related

activities. Such companies may directly or

indirectly benefit from increase in consumption

led demand. Illustrative list of such sectors is as

under.

1. Consumer Durables

2. Consumer Non-Durables

3. Healthcare

4. Pharmaceuticals

5. Auto

6. Auto Ancillaries

7. Telecom

8. Services

9. Media & Entertainment

10. Aviation

11. Textiles

12. Fertilisers and Pesticides

13. Retailing

Sectors mentioned above are indicative in

nature and the Fund Manager may invest in

sectors other than these that may benefit

directly or indirectly from consumption and

related activities.

The scheme will be following a blend approach,

a combination of value and growth, to build the

portfolio. The scheme intends to invest in stocks

across large cap, midcap, small cap.

As and when the fund manager is of the view

that a specific investment has met its desired

objective and the investment is liquidated, the

proceeds may be distributed by way of

dividend, subject to the availability of

distributable surplus.

10


Fund


Fund – Series 1

dividend, subject to the availability of

distributable surplus.

The Scheme may use derivative instruments

like Interest Rate Swaps, Interest Rate Futures,

Forward Rate Agreements Stock / Index

Futures or Options or other instruments for the

purpose of hedging, portfolio balancing and

other purposes, as permitted under the

Regulations. Hedging using Interest Rate

Futures could be perfect or imperfect, subject

to applicable regulations. Usage of derivatives

may expose the Scheme to certain risks

inherent to such derivatives. It may also invest

in securitized debt.



other Mutual Funds, provided it is in

conformity with the investment objective of the

Scheme and in terms of the prevailing

Regulations. As per the Regulations, no

investment management fees will be charged

for such investments. As per the SEBI

Regulations, such inter scheme investments

shall not exceed 5% of the Net Asset Value of

the Fund.

At present, the Scheme does not intend to

enter into underwriting obligations. However, if

the Scheme does enter into an underwriting

agreement, it would do so after complying with

the Regulations and with the prior approval of

the Board of the AMC/Trustee.

The Scheme may also invest in depository

receipts including American Depository

Receipts (ADRs), Global Depository Receipts

(GDRs) and foreign securities.

The Scheme may also invest in debt and

money market instruments, in compliance with

Regulations.

The Scheme may invest in derivatives to

engage in permitted currency hedging

transactions with an intention to reduce

exchange rate fluctuations between the

currency of the Scheme (INR) and the foreign

currency exposure.

Fixed Income securities

The Scheme may also invest in Debt and

Money Market Securities/Instruments (Money

Market securities include cash and cash

The Scheme may also use various derivatives

and hedging products from time to time, as

would be available and permitted by SEBI, in an

attempt to protect the value of the portfolio and

enhance Unit holders’ interest.



other Mutual Funds, provided it is in conformity

with the investment objective of the Scheme

and in terms of the prevailing Regulations. As

per the Regulations, no investment

management fees will be charged for such

investments and the aggregate inter-scheme

investment made by all Schemes of the Fund or

in Schemes under the management of other

asset management companies shall not exceed

5% of the Net Asset Value of the Mutual Fund.

At present, the Scheme does not intend to enter

into underwriting obligations. However, if the

Scheme does enter into an underwriting




The Scheme may also invest in depository

receipts including American Depository

Receipts (ADRs) and Global Depository Receipts

(GDRs).

The Scheme may also invest in debt and money

market instruments, in compliance with

Regulations.

The Scheme may invest in derivatives to engage

in permitted currency hedging transactions with

an intention to reduce exchange rate

fluctuations between the currency of the

Scheme (INR) and the foreign currency

exposure.

Portfolio Turnover

Portfolio turnover is defined as the lower of

purchases and sales divided by the average

assets under management of the Scheme

during a specified period of time.

The AMC’s portfolio management style is

conducive to a low portfolio turnover rate.

However, the AMC will take advantage of the

opportunities that present themselves from time

to time because of the inefficiencies in the

securities markets. The AMC will endeavour to

balance the increased cost on account of higher

11


Fund


Fund – Series 1

equivalents). The Scheme aims to identify

securities which offer optimal level of

yields/returns, considering risk-reward ratio.

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 Risk Management Team of the AMC.

The credit evaluation includes a study of the

operating environment of the issuer, the short

as well as long-term financial health of the

issuer. Rated debt instruments in which the

Scheme invests will be of investment grade as

rated by a credit rating agency. The AMC may

consider the ratings of such Rating Agencies as

approved by SEBI to carry out the functioning

of rating agencies. The Scheme may invest in

securitised debt.

In addition, the investment team of the AMC

will study the macro economic conditions,

including the political, economic environment

and factors affecting liquidity and interest rates.

The AMC would use this analysis to attempt to

predict the likely direction of interest rates and

position the portfolio appropriately to take

advantage of the same.

Further, the Scheme may invest in other

schemes managed by the AMC or in the

schemes of any other Mutual Funds in terms of

the prevailing Regulations. As per the

Regulations, no investment management fees

will be charged for such investments.

For the present, the Scheme does not intend to

enter into underwriting obligations. However, if

the Scheme does enter into an underwriting




Portfolio Turnover

Portfolio turnover is defined as the lower of

purchases and sales after reducing all

subscriptions and redemptions transactions

there from and calculated as a percentage of

the average assets under management of the

Scheme during a specified period of time.

Given that the Scheme is an open ended

Scheme, it is expected that there would be a

number of subscriptions and redemptions on a

daily basis. Also, portfolio turnover would be

impacted by investment strategy of the

scheme. Hence, it is difficult to estimate with

any reasonable measure of accuracy, the likely

turnover in the portfolio.

portfolio turnover with the benefits derived

there from.

12


Fund


Fund – Series 1

The AMC’s portfolio management style is

conducive to a low portfolio turnover rate.

However, the AMC will take advantage of the

opportunities that present themselves from

time to time because of the inefficiencies in the

securities markets. The AMC will endeavour to

balance the increased cost on account of

higher portfolio turnover with the benefits

derived there from.

Plans/

Options

under the

Scheme

Plans ICICI Prudential

Bharat Consumption

Fund - Direct Plan

and ICICI Prudential

Bharat Consumption

Fund

Options/

sub-

options

Growth Options and

IDCW Option with

IDCW Payout and

IDCW Reinvestment

sub-options

Default

Option

Growth Option

Default

sub-option

IDCW Reinvestment

Plans ICICI Prudential

Bharat Consumption

Fund – Series 1

Direct Plan and ICICI

Prudential Bharat

Consumption Fund –

Series 1

Options/

sub-

options

Cumulative Option

and IDCW Option

with IDCW Payout

and IDCW Transfer

facility

Default

Option

Cumulative Option

Exit Loads

under the

Scheme*

1% of applicable Net Asset Value - If the

amount sought to be redeemed or switch

out is invested for a period of up to three

months from the date of allotment

Nil - If the amount, sought to be redeemed

or switch out is invested for a period of

more than three months from the date of

allotment

The Trustees shall have a right to prescribe or

modify the exit load structure with prospective

effect subject to a maximum prescribed under

the Regulations.

Being a listed scheme, no exit load will be

applicable.

Name of

Fund

Manager

Mr. Parag Thakkar

In addition to the above fund managers

managing this fund, overseas investment is

managed by Ms. Priyanka Khandelwal.

Mr. Anish Tawaklay and Mr. Lalit Kumar

In addition to the above fund managers

managing this fund, overseas investment is

managed by Ms. Priyanka Khandelwal.

Total

Expense

Ratio (TER)

The maximum recurring expenses that can be

charged to the Scheme shall be subject to a

percentage limit of daily net assets as shown

in the following table:

Net Assets Percentage of TER

First Rs. 500

crore

2.25%

Next Rs. 250

crore

2.00%

Next Rs.

1,250 crore

1.75%

The maximum recurring expenses that can be

charged to the Scheme shall be subject to a

percentage limit of daily net assets as shown in

the following table:

Net Assets Percentage of TER

On the entire

net assets

1.25%

In addition to the above, Goods and Services

Tax (GST) can be charged on the investment

management and advisory fees.

13


Fund


Fund – Series 1

Next Rs.

3,000 crore

1.60%

Next Rs.

5,000 crore

1.50%

Next Rs.

40,000 crore

TER reduction of

0.05% for every

increase of Rs.

5,000 crore of daily

net assets or part

thereof

Balance 1.05%

In addition to the above, following expenses

can be charged to the Scheme:

a) Up to 5 basis points (bps) under Regulation

52(6A)(c ),

b) Up to 30 bps for gross new inflows from

retail investors from B30 cities, and

c) Goods and Services Tax (GST) on

investment management and advisory fees.

TER as of August 31, 2021: Regular Plan –

2.53%

Direct Plan – 1.09%

TER as of August 31, 2021: Regular Plan – 1.41%

Direct Plan – 1.11%

• IDCW = Income Distribution cum capital withdrawal option

• IDCW Payout = Payout of Income Distribution cum capital withdrawal option

• IDCW Reinvestment = Reinvestment of Income Distribution cum capital withdrawal option

• IDCW Transfer = Transfer of Income Distribution cum capital withdrawal plan

Risk Factors pertaining to REITS/INVITS and Gold and Gold ETFs are as follows:

Risk Factors Associated with Investments in REITs and InvITS:

Market Risk:

REITs and InvITs are volatile and prone to price fluctuations on a daily basis owing to market

movements. Investors may note that AMC/Fund Manager’s investment decisions may not

always be profitable, as actual market movements may be at variance with the anticipated

trends. The NAV of the Scheme is vulnerable to movements in the prices of securities invested

by the scheme, due to various market related factors like changes in the general market

conditions, factors and forces affecting capital market, level of interest rates, trading volumes,

Real Estate and Infrastructure sectors, settlement periods and transfer procedures. The scheme

will undertake active portfolio management as per the investment objective to reduce the

marker risk.

Liquidity Risk:

As the liquidity of the investments made by the Scheme(s) could, at times, be restricted by

trading volumes and settlement periods, the time taken by the Mutual Fund for liquidating the

investments in the scheme may be high in the event of immediate redemption requirement.

Investment in such securities may lead to increase in the scheme portfolio risk. The fund will

try to maintain a proper asset-liability match to ensure redemption payments are made on time

and not affected by illiquidity of the underlying units.

Reinvestment Risk:

14

Investments in REITs & InvITs may carry reinvestment risk as there could be repatriation of

funds by the Trusts in form of buyback of units or dividend pay-outs, etc. Consequently, the

proceeds may get invested in assets providing lower returns. However, the reinvestment risk

will be limited as the proceeds are expected to be a small portion of the portfolio value.

Interest Rate Risk: Securities / Instruments of REITs and InvITs run interest rate risk. Generally,

when interest rates rise, prices of units fall and when interest rates drop, such prices increase.

The above are some of the common risks associated with investments in REITs & InvITs. There

can be no assurance that a Scheme's investment objectives will be achieved, or that there will

be no loss of capital. Investment results may vary substantially on a monthly, quarterly or

annual basis.

Risk associated with investments in Gold and Gold ETF’s:

The scheme would invest in Gold and Gold linked instruments. Accordingly the NAV of the

scheme will react to Gold price movements.

Several factors that may affect the price of gold are as follows:

- Global gold supplies and demand, which is influenced by factors such as forward selling

by gold producers, purchases made by gold producers to unwind gold hedge positions,

central bank purchases and sales, productions and cost levels in major gold producing

countries such as the South Africa, the United States and Australia.

- Investors’ expectations with respect to the rate of inflation

- Currency exchange rates

- Interest rates

- Investment and trading activities of hedge funds and commodity funds

- Global or regional political, economic or financial events and situations

- Changes in indirect taxes or any other levies

Investors should be aware that there is no assurance that gold will maintain its long-term

value in terms of purchasing power in the future. In the event that the price of gold declines,

the value of investment is expected to decline proportionately.

The returns from physical gold in which the scheme invests may underperform returns from

the various general securities markets or different asset classes other than gold. Different

types of securities tend to go through cycles of out-performance and under-performance

in comparison to the general securities markets.

The scheme may invest in Gold ETFs. The units may trade above or below their NAV. The

NAV of the Scheme will fluctuate with changes in the market value of the holdings. The

trading prices will fluctuate in accordance with changes in their NAV as well as market

supply and demand. However, given that units can be created and redeemed in Creation

Units, it is expected that large discounts or premiums to the NAV will not sustain due to

arbitrage opportunity available.

Gold ETFs are relatively new product and their value could decrease if unanticipated

operational or trading problems arise.

In case of investment in Gold ETFs, the scheme will subscribe to the units of Gold ETFs

according to the value equivalent to unit creation size as applicable. When subscriptions

received are not adequate enough to invest in creation unit size, the subscriptions may be

deployed in debt and money market instruments which will have a different return profile

compared to gold returns profile.

15

Provisions pertaining to “Segregated Portfolio” and “Writing of Covered Call Strategy” shall be

applicable to the Surviving scheme with effect from effective date of merger of ICICI Prudential

Bharat Consumption Fund and ICICI Prudential Bharat Consumption Fund – Series 1. Details of

the changes in ICICI Prudential Bharat Consumption Fund can be referred in Annexure A.

For complete details on the Surviving Scheme, investors are requested to refer to SID of the

Scheme available on the website.

1. Impact of the merger with respect to allocation of units to the unitholders of the

Merging Scheme

*Unitholders of the Merging Scheme are requested to note that the provisions of exit load of the

Surviving Scheme will not be applicable in respect of the units of the Surviving Scheme which

are allotted to them upon merger of the schemes.

On the effective date of the merger of schemes, the Merging Scheme will cease to exist and

the unit holders of Merging Scheme as at the close of business hours will be allotted units

under the corresponding option of the Surviving Scheme at the last available applicable Net

Asset Value (“NAV”) on the effective date. For example:

Activity Investment

Value (in Rs.)

At NAV No. of

Units

Value of holdings in ICICI Prudential Bharat

Consumption Fund – Series 1 Cummulative

Option (on August 31, 2021)

117,700.00 11.77 10,000.00

ICICI Prudential Bharat Consumption Fund –

Growth Option on date of merger (August

31, 2021)

174.59

Fresh allotment to investor (in ICICI

Prudential Bharat Consumption Fund –

Growth Option)

117,700.00 174.59 674.15

(Dates and Figures are only for illustrative purposes)

In case of any pledge/ lien/ other encumbrance marked on any units in the Merging Scheme,

the same shall be marked on the corresponding number of units allotted in the Surviving

Scheme.

Securities Transaction Tax (STT) on extinguishment of units under Merging Scheme and

allotment under the Surviving Scheme upon merger of schemes, shall not be levied.

In case of Non Resident Indians, tax, if any at applicable rates, shall be deducted by ICICI

Prudential Mutual Fund/ the AMC.

Plan/option wise allocation of units will be as follows:

Holding in Plan and option under the

Merging Scheme

Allocation in Plan and option under

the Surviving Scheme

ICICI Prudential Bharat Consumption –

Series 1 – Cumulative


Fund – Growth


Series 1 – IDCW – payout


Fund – IDCW


Series 1 – Direct Plan – Cumulative


Fund – Direct Plan – Growth


Series 1 – Direct Plan – IDCW - payout


Fund – Direct Plan – IDCW

16

If the investor of the ICICI Prudential Bharat Consumption Fund – Series 1 (merging scheme)

does not hold any existing investments in ICICI Prudential Bharat Consumption Fund (surviving

scheme) then the IDCW option would be IDCW payout sub-option. If the investor has existing

investments in ICICI Prudential Bharat Consumption Fund, the current IDCW option (i.e. either

IDCW payout or IDCW re-investment) as selected in the folio would continue.

Systematic registration like Dividend Transfer Plan in the Merging Scheme will be ceased on

merger.

2. Impact of the merger with respect to allocation of units to the unitholders of the

Surviving Scheme

The merger will not result in the emergence of any new scheme as ICICI Prudential Bharat

Consumption Fund – Series 1 will be merged in the Surviving Scheme, viz. ICICI Prudential

Bharat Consumption Fund. Post-merger, the investments under the Surviving Scheme will be

in accordance with the investment objective and asset allocation of the Surviving Scheme.

There will be no impact of the merger on the units held by the unitholders of the Surviving

Scheme.

3. Percentage of total Non-performing Assets (NPAs) and total illiquid assets in the

Merging Scheme and the Surviving Scheme: NIL

4. Tax impact on consolidation of Schemes:

The following provisions would apply in case of consolidation of mutual fund schemes.

As per section 47(xviii) of Income Tax Act, 1961 (the Act), any transfer of units held by the

investor in the consolidating scheme of the mutual fund in consideration of allotment of units

in the consolidated scheme, shall not to be regarded as a taxable transfer, provided that the

consolidation is of two or more schemes of an equity oriented fund or two or more schemes

of a fund other than equity oriented fund.

Further, as per section 49(2AD) of the Act, the cost of acquisition of units in the consolidated

scheme shall be deemed to be the cost of acquisition of the units in the consolidating scheme.

Also, as per section 2(42A) of the Act, the period of holding of the units in the consolidated

scheme shall include the period of holding of the units in the consolidating scheme.

‘Consolidating scheme’ has been defined under section 47(xviii) of the Act as the scheme of a

Mutual Fund which merges under the process of consolidation of the schemes of mutual fund

in accordance with the SEBI (Mutual Funds) Regulations, 1996. ‘Consolidated scheme’ has

been defined as the scheme with which the consolidating scheme merges or which is formed

as a result of such merger.

Securities Transaction Tax (STT) on extinguishment of units under Merging Scheme and

allotment under the Surviving Scheme upon merger of schemes, shall not be levied.

Stamp Duty on allotment under the Surviving Scheme upon merger of schemes, shall not be

levied.

In case of Non Resident Indians, tax, if any at applicable rates, shall be deducted by ICICI

Prudential Mutual Fund/ the AMC.

5. Exit Option under the Scheme:

As per Circular No. SEBI/ MFD/Cir No. 05/12031/03 dated June 23, 2003 issued by SEBI, merger

of schemes is considered as a change in fundamental attributes of the concerned schemes

necessitating compliance with the requirements laid down for change in fundamental

attributes. As per Regulation 18(15A) of SEBI (Mutual Funds) Regulations, 1996, changes in

17

fundamental attributes can be carried out only after the unit holders of the schemes concerned

have been informed of the change via written communication and an option to exit the

scheme(s) within a period of 30 days at the prevailing NAV without any exit load is provided

to them. Accordingly, this Notice provides communication to the unit holders of ICICI

Prudential Bharat Consumption Fund – Series 1 for the merger of ICICI Prudential Bharat

Consumption Fund – Series 1 (Merging Scheme) into ICICI Prudential Bharat Consumption

Fund (Surviving Scheme).

Exit Option for Unitholders of ICICI Prudential Bharat Consumption Fund – Series

1 (Merging Scheme) for proposed merger:

In accordance with Regulation 18(15A) of the SEBI (Mutual Funds) Regulations, 1996 the

existing unitholders of the Merging Scheme (i.e. whose names appear in the register of

unitholders as on close of business hours on September 24, 2021) are hereby given an option

to exit, i.e. either redeem their investments or switch their investments to any other schemes

of ICICI Prudential Mutual Fund, within the Exit Option Period (minimum 30 days) starting from

October 01, 2021 till November 01, 2021 (both days inclusive and up to 3.00 pm on November

01, 202). If the units are held in dematerialized form, investors are requested to contact their

Depository Participant and rematerialize their units before placing redemption or switch

request. Unitholders of the Merging Scheme who do not exercise the exit option by 3.00 pm

on November 01, 2021 would be deemed to have consented to the proposed merger. It may

also be noted that no action is required in case the Unitholders of the Merging Scheme are in

agreement with the proposed merger, which shall be deemed as consent being given by them

for the proposed merger. Kindly note that an offer to exit is merely optional and is not

compulsory.

All the valid applications for redemptions/switch received under the ICICI Prudential Bharat

Consumption Fund – Series 1 shall be processed at Applicable NAV as on November 01, 2021

and the redemption proceeds shall be remitted/ dispatched to those Unitholders of the

Merging Scheme within 10 (ten) working days from November 01, 2021.

Further, investors are requested to note that post effective date of the merger i.e. closure of

business hours of November 01, 2021, the Merging Scheme shall not be available for trading

on the stock exchange.

For list of Official Points of Acceptance, please visit our website. The Exit Option can be

exercised during the Exit Option Period by submitting a valid redemption/switch request at

any Official Point of Acceptance of the Fund. A separate written communication is being sent

to the existing Unit holders of the Merging Scheme and Surviving Scheme in this regard. In

case any existing Unit holder of the Merging Scheme and Surviving Scheme has not received

an Exit Option Letter, they are advised to contact any of our Investor Service Centres

You can switch or redeem your investments using the following options:

Download IPRUTOUCH

Login to Invest now

Visit your nearest ICICI Prudential Mutual Fund or CAMS branch.

Unitholders of Merging Scheme who have pledged or encumbered their units will not have

the option to exit unless they procure a release of their pledges/encumbrances prior to the

submission of redemption requests. Unitholders should ensure that their change in address or

bank details are updated in records of ICICI Prudential Mutual Fund as required by them, prior

to exercising the exit option for redemption of units. Unit holders holding Units in

dematerialized form may approach their Depository Participant for such changes. In case units

have been frozen/locked pursuant to an order of a government authority or a court, such exit

option can be executed only after the freeze/lock order is vacated/receipt of valid redemption

request to those unitholders who choose to exercise their exit option. Redemption/switch of

units from the scheme, during the exit option period, may entail capital gain/loss in the hands

of the unitholder. Similarly, in case of NRI investors, TDS shall be deducted in accordance with

18

the applicable Tax laws, upon exercise of exit option and the same would be required to be

borne by such investor only. In view of individual nature of tax implications, unitholders are

advised to consult their tax advisors. It may be noted that the redemption/switch transactions

shall not be processed if the unit holders have not completed KYC requirements.

In case you require any further assistance or clarification, (1) you can get in touch with your

Mutual Fund Distributor OR (2) write to us at [email protected] OR (3) contact on our

customer care helplines 1800 222 999(from MTNL/BSNL) and 1800 200 6666 (Others) between

8 am and 8 PM, Monday to Saturday and between 9 am to 7 PM on Sunday.

6. Unclaimed dividends and redemptions:

In view of the decision to transfer the balance remaining unclaimed on account of dividends in

the accounts from ICICI Prudential Bharat Consumption Fund – Series 1 to ICICI Prudential ICICI

Prudential Bharat Consumption Fund, set out are the details of the unclaimed dividend and

redemption amounts in ICICI Prudential Bharat Consumption Fund – Series 1 as on August 31,

2021.

Name of the Scheme Unclaimed Dividend

(Amount in `)

Unclaimed Redemption

(Amount in `)


Consumption Fund – Series 1

Nil Nil


Consumption Fund

Nil 0.11 crores

The request for reissue/ revalidation of instruments towards unclaimed redemption / dividend

should be made by the unit holder to Computer Age Management Services Limited (CAMS), the

registrar to the schemes of ICICI Prudential Mutual Fund, or to the nearest branch of the AMC.

We hope that you will provide us your support; in case of any queries you can reach our call

centre. We assure you that these changes are in line with our best endeavors to serve you better.

Also in relation to unclaimed dividend/redemption, we request you to kindly contact us at any of

Investor Service Centre/Official Point of Acceptance of the Fund, to assist you in the payment of

unclaimed amount. The list of Official Points of Acceptance is available on our website

www.icicipruamc.com under the “Contact Us “section.

We shall continue to work towards your investment success and keep you updated on our views

in the future.

We look forward to a long partnership with you on your road to wealth creation.

Warm regards,

For ICICI Prudential Asset Management Company Limited

Sd/-

Authorized Signatory

http://www.icicipruamc.com/

19

Annexure A

Change in fundamental attributes of the ICICI Prudential Bharat Consumption Fund:

With a view to standardize the provisions under the Scheme, the AMC proposes to introduce the

following provisions in the Scheme:

1. Writing of call options under covered call strategy:

SEBI has vide its circular dated August 18, 2010, permitted Mutual Funds to invest in

derivatives subject to making adequate disclosures. In partial modification to the aforesaid

circular, SEBI has vide its circular dated January 16, 2019 (the Circular), permitted mutual

fund schemes (except index funds and exchange traded funds) to write call options under

covered call option strategy for constituent stocks of NIFTY 50 and BSE SENSEX, subject to

certain investment restrictions.

2. Segregation of portfolios:

The provisions related to segregation of portfolios in accordance with SEBI Circulars are

proposed to be included.

The Scheme Information Document will suitably be modified to include the aforesaid provisions

and other disclosures as required in this regard. The proposed changes and disclosures to be

included in the SID of the Scheme are as below:

1. COVERED CALL STRATERGY:

RISKS FOR WRITING COVERED CALL OPTIONS FOR EQUITY SHARES

A call option gives the holder (buyer) the right but not the obligation to buy an asset by a certain

date for a certain price. Covered calls are an options strategy where a person holds a long position

in an asset and writes (sells) call options on that same asset to generate an income stream. The

Scheme may write call options under covered call strategy, as permitted by the regulations. Risks

associated thereto are mentioned below:

a) Writing call options are highly specialized activities and entail higher than ordinary investment

risks. In such investment strategy, the profits from call option writing is capped at the option

premium, however the downside depends upon the increase in value of the underlying equity

shares. This downside risk is reduced by writing covered call options.

b) The Scheme may write covered call option only in case it has adequate number of underlying

equity shares as per regulatory requirement. This would lead to setting aside a portion of

investment in underlying equity shares. If covered call options are sold to the maximum extent

allowed by regulatory authority, the scheme may not be able to sell the underlying equity shares

immediately if the view changes to sell and exit the stock. The covered call options need to be

unwound before the stock positions can be liquidated. This may lead to a loss of opportunity,

or can cause exit issues if the strike price at which the call option contracts have been written

become illiquid. Hence, the scheme may not be able to sell the underlying equity shares, which

can lead to temporary illiquidity of the underlying equity shares and result in loss of opportunity.

c) The writing of covered call option would lead to loss of opportunity due to appreciation in value

of the underlying equity shares. Hence, when the appreciation in equity share price is more than

the option premium received the scheme would be at a loss.

d) The total gross exposure related to option premium paid and received must not exceed the

regulatory limits of the net assets of the scheme. This may restrict the ability of Scheme to buy

any options.

20

Investment Restrictions on writing call options:

Mutual Fund schemes (excluding ETFs and Index funds) can write Call options under a covered

strategy for constituent stocks of NIFTY 50 and BSE SENSEX subject to the following:

a) The total notional value (taking into account strike price as well as premium value) of call options

written by a scheme shall not exceed 15% of the total market value of equity shares held in that

scheme.

b) The total number of shares underlying the call options written shall not exceed 30% of the

unencumbered shares of a particular company held in the scheme. The unencumbered shares

in a scheme shall mean shares that are not part of Securities Lending and Borrowing Mechanism

(SLBM), margin or any other kind of encumbrances.

a) At all points of time the Mutual Fund scheme shall comply with the provisions at points (a) and

(b) above. In case of any passive breach of the requirement at paragraph (a) above, the

respective scheme shall have 7 trading days to rebalance the portfolio. During the rebalancing

period, no additional call options can be written in the said scheme.

b) In case a Mutual Fund scheme needs to sell securities on which a call option is written under a

covered call strategy, it must ensure compliance with paragraphs (a) and (b) above while selling

the securities.

c) In no case, a scheme shall write a call option without holding the underlying equity shares. A

call option can be written only on shares which are not hedged using other derivative contracts.

d) The premium received shall be within the requirements prescribed in terms of SEBI circular

dated August 18, 2010 i.e. the total gross exposure related to option premium paid and received

must not exceed 20% of the net assets of the scheme.

e) The exposure on account of the call option written under the covered call strategy shall not be

considered as exposure in terms of paragraph 3 of SEBI Circular no. Cir/IMD/DF/11/2010, dated

August 18, 2010.

f) The call option written shall be marked to market daily and the respective gains or losses

factored into the daily NAV of the respective scheme(s) until the position is closed or expired.

Under Derivatives Strategy –

Writing call options under Covered call strategy

A call option gives the holder (buyer) the right but not the obligation to buy an asset by a certain

date for a certain price. Covered calls are an options strategy where a person holds a long position

in an asset and writes (sells) call options on that same asset to generate an income stream. The

Scheme may write call options under covered call strategy, as permitted by Regulations.

Benefits of using Covered Call strategy in Mutual Funds:

The covered call strategy can be followed by the Fund Manager in order to hedge risk thereby

resulting in better risk adjusted returns of the Scheme. This strategy is also employed when the

Fund Manager has a short-term neutral view on the asset and for this reason holds the asset long

and simultaneously takes a short position via covered call option strategy to generate income from

the option premium. The strategy offers the following benefits:

g) Hedge against market risk - Since the fund manager sells a call option on a stock already owned

by the mutual fund scheme, the downside from fall in the stock price would be lower to the

extent of the premium earned from the call option.

h) Generating additional returns in the form of option premium in a range bound market.

Thus, a covered call strategy involves gains for unit holders in case the strategy plays out in the

right direction

Illustration – Covered Call strategy using stock call options:

Suppose, a fund manager buys equity stock of ABC Ltd. For Rs. 1000 and simultaneously sells a

call option on the same stock at a strike price of Rs. 1100. The scheme earns a premium of say, Rs.

50. Here, the fund manager does not think that the stock price will exceed Rs. 1100.

21

Scenario 1: Stock price exceeds Rs. 1100

The call option will get exercised and the fund manager will sell the stock to settle his obligation on

the call at Rs. 1100 (earning a return of 10% on the stock purchase price). Also, the scheme has

earned a premium of Rs. 50 which reduced the purchase cost of the stock (Rs. 1000 – Rs. 50 = Rs.

950).

Net Gain – Rs. 150

Scenario 2: Stock prices stays below Rs. 1100

The call option will not get exercised and will expire worthless. The premium earned on call option

will generate alpha for the scheme.

Net Gain – Rs. 50.

2. PROVISIONS RELATING TO SEGREGATION OF PORTFOLIOS:

In order to ensure fair treatment to all investors in case of a Credit Event and to deal with liquidity

risk, SEBI vide its circular no. SEBI/HO/IMD/DF2/CIR/P/2018/160 dated December 28, 2018, as

amended from time to time has allowed creation of Segregated Portfolio of debt and money market

instruments by mutual fund schemes.

The AMC may create a segregated portfolio of debt and money market instruments in a mutual

fund scheme in case of a credit event and to deal with liquidity risk.

In this regard, the term ‘segregated portfolio’ shall mean a portfolio comprising of debt or money

market instrument affected by a credit event, that has been segregated in a mutual fund scheme

and the term ‘main portfolio’ shall mean the scheme portfolio excluding the segregated portfolio.

The term ‘total portfolio’ shall mean the scheme portfolio including the securities affected by the

credit event.

The AMC at its discretion may create Segregated Portfolio in the Scheme, with the approval of the

Trustees, subject to the following:

A segregated portfolio may be created in a mutual fund scheme in case of a credit event at issuer

level i.e. downgrade in credit rating by a SEBI registered Credit Rating Agency (CRA), as under:

a. Downgrade of a debt or money market instrument to ‘below investment grade’, or

b. Subsequent downgrades of the said instruments from ‘below investment grade’, or

c. Similar such downgrades of a loan rating.

In case of difference in rating by multiple CRAs, the most conservative rating shall be considered.

Creation of segregated portfolio shall be based on issuer level credit events as detailed above and

implemented at the ISIN level.

The AMC may also create a segregated portfolio of unrated debt and money market instruments of

an issuer that does not have any outstanding rated debt or money market instruments in case of

‘actual default’ of either the interest or principal amount.' subject to guidelines prescribed by SEBI

in this behalf from time to time.

Process for creation of segregated portfolio

1. The AMC shall decide on creation of segregated portfolio on the day of credit event, as per

the process laid down below:

i. The AMC shall seek approval of Trustees, prior to creation of the segregated portfolio.

ii. The AMC shall immediately issue a press release disclosing its intention to segregate such

debt and money market instrument and its impact on the investors. It shall also be disclosed

that the segregation shall be subject to trustee approval. Additionally, the said press release

shall be prominently disclosed on the website of the AMC. (icicipruamc.com)

22

iii. The AMC shall ensure that till the time the Trustee approval is received, the subscription

and redemption in the scheme shall be suspended for processing with respect to creation

of units and payment on redemptions.

2. Upon receipt of approval from Trustees:

i. The segregated portfolio shall be effective from the day of credit event

ii. The AMC shall issue a press release immediately with all relevant information pertaining to

the segregated portfolio. The said information shall also be submitted to SEBI.

iii. An e-mail or SMS shall be sent to all unit holders of the concerned scheme.

iv. The NAV of both segregated and main portfolio shall be disclosed from the day of the credit

event.

v. All existing investors in the scheme as on the day of the credit event shall be allotted equal

number of units in the segregated portfolio as held in the main portfolio.

vi. No redemption and subscription shall be allowed in the segregated portfolio. However, in

order to facilitate exit to unit holders in segregated portfolio, AMC shall enable listing of

units of segregated portfolio on the recognized stock exchange within 10 working days of

creation of segregated portfolio and also enable transfer of such units on receipt of transfer

requests.

3. If the trustees do not approve the proposal to segregate portfolio, the AMC shall issue a press

release immediately informing investors of the same.

Valuation and processing of subscriptions and redemptions:

1. Notwithstanding the decision to segregate the debt and money market instrument, the valuation

shall take into account the credit event and the portfolio shall be valued based on the principles

of fair valuation (i.e. realizable value of the assets) in terms of the relevant provisions of SEBI

(Mutual Funds) Regulations, 1996 and Circular(s) issued thereunder.

2. All subscription and redemption requests for which NAV of the day of credit event or subsequent

day is applicable will be processed as per the existing circular on applicability of NAV as under:

a. Upon trustees’ approval to create a segregated portfolio -

i. Investors redeeming their units will get redemption proceeds based on the NAV of

main portfolio and will continue to hold the units of segregated portfolio.

ii. Investors subscribing to the scheme will be allotted units only in the main portfolio

based on its NAV.

b. In case trustees do not approve the proposal of segregated portfolio, subscription and

redemption applications will be processed based on the NAV of total portfolio.

Periodic Disclosures:

In order to enable the existing as well as the prospective investors to take informed decision, the

following shall be adhered to:

a. A statement of holding indicating the units held by the investors in the segregated portfolio

along with the NAV of both segregated portfolio and main portfolio as on the day of the

credit event shall be communicated to the investors within 5 working days of creation of

the segregated portfolio.

b. Adequate disclosure of the segregated portfolio shall appear in all scheme related

documents, in monthly and half-yearly portfolio disclosures and in the annual report of the

mutual fund and the scheme.

c. The Net Asset Value (NAV) of the segregated portfolio shall be declared on daily basis.

d. The information regarding number of segregated portfolios created in a scheme shall

appear prominently under the name of the scheme at all relevant places such as SID, KIM-

cum-Application Form, advertisement, AMC and AMFI websites, etc.

e. The scheme performance required to be disclosed at various places shall include the impact

of creation of segregated portfolio. The scheme performance should clearly reflect the fall

23

in NAV to the extent of the portfolio segregated due to the credit event and the said fall in

NAV along with recovery(ies), if any, shall be disclosed as a footnote to the scheme

performance.

f. The disclosures at paragraph (d) and (e) above regarding the segregated portfolio shall be

carried out for a period of at least 3 years after the investments in segregated portfolio are

fully recovered/ written-off.

g. The investors of the segregated portfolio shall be duly informed of the recovery

proceedings of the investments of the segregated portfolio. Status update may be provided

to the investors at the time of recovery and also at the time of writing-off of the segregated

securities.

In order to ensure timely recovery of investments of the segregated portfolio, the Trustees to the

fund would continuously monitor the progress and take suitable action as may be required.

TER for the Segregated Portfolio

a. AMC shall not charge investment and advisory fees on the segregated portfolio. However,

TER (excluding the investment and advisory fees) can be charged, on a pro-rata basis only

upon recovery of the investments in segregated portfolio.

b. The TER so levied shall not exceed the simple average of such expenses (excluding the

investment and advisory fees) charged on daily basis on the main portfolio (in % terms)

during the period for which the segregated portfolio was in existence.

c. The legal charges related to recovery of the investments of the segregated portfolio may

be charged to the segregated portfolio in proportion to the amount of recovery. However,

the same shall be within the maximum TER limit as applicable to the main portfolio. The

legal charges in excess of the TER limits, if any, shall be borne by the AMC.

d. The costs related to segregated portfolio shall in no case be charged to the main portfolio.

Investors may also note that the process followed by the AMC/Trust regarding creation of

segregated portfolios shall be in accordance with the provisions laid down by SEBI in this regard,

from time to time.

Benefits and Features of Creation of Segregated Portfolio:

a. Creation of Segregated portfolio helps ensuring fair treatment to all investors in case of a

credit event and helps in managing liquidity risk during such events;

b. Investors redeeming their units will get redemption proceeds based on the NAV of main

portfolio and will continue to hold the units of segregated portfolio;

c. Investors subscribing to the scheme will be allotted units only in the main portfolio based

on its NAV;

d. A statement of holding indicating the units held by the investors in the segregated portfolio

along with the NAV of both segregated portfolio and main portfolio as on the day of the

credit event shall be communicated to the investors within 5 working days of creation of

the segregated portfolio;

e. Adequate disclosure of the segregated portfolio shall appear in all scheme related

documents, in monthly and half-yearly portfolio disclosures and in the annual report of the

mutual fund and the scheme; and

f. The investors of the segregated portfolio shall be duly informed of the recovery

proceedings of the investments of the segregated portfolio. Status update may be

provided to the investors at the time of recovery and also at the time of writing-off of the

segregated securities.

Numerical illustration explaining how segregated portfolios will work

Total Assets under DEBT instruments: 10 lakhs and Total 2 investors in the Scheme:

Units Amount Portfolio Value

24

Investors A 30,000 3,75,000 DEBT A 5,00,000

Investors B 50,000 6,25,000 DEBT B 3,00,000

DEBT C 2,00,000

Total 80,000 10,00,000 Total 10,00,000

NAV (Full Portfolio): Rs. 12.5

Credit Event: Security DEBT B downgrades and value falls from 3,00,000 to 280,000

Post Segregation (Main Portfolio):

Units Amount Portfolio Value

Investors A 30,000 2,62,500 DEBT A 5,00,000

Investors B 50,000 4,37,500 DEBT C 2,00,000

Total 80,000 7,00,000 Total 7,00,000

NAV (Main Portfolio): Rs. 8.75

Post Segregation (Segregated Portfolio):

Total 2 investors in the Scheme: Units Amount Portfolio Value

Investors A (units) 30,000 1,05,000 DEBT B 2,80,000

Investors B (units) 50,000 1,75,000

Total 80,000 280,000 Total 280,000

NAV (Segregated Portfolio): Rs. 3.5

Units

Main

Portfolio

Segregated

Portfolio Amount

Total Holding of Investor A 30,000 2,62,500 1,05,000 3,67,500

Total Holding of Investor B 50,000 4,37,500 1,75,000 6,12,500

Total 700,000 2,80,000

9,80,000

Notes:

Investors who invest / subscribe to the units of the Scheme post creation of segregated portfolio

shall be allotted units in the Main Portfolio only.

Investors redeeming their units post creation of segregated portfolio will get redemption

proceeds based on NAV of main portfolio and will continue to hold units in Segregated portfolio.

No redemption and / or subscription shall be allowed in the Segregated Portfolio.

Units of Segregated portfolio shall be listed on a recognised stock exchange.

In order to ensure timely recovery of investments of the segregated portfolio, trustees shall ensure

that:

a. The AMC puts in sincere efforts to recover the investments of the segregated portfolio.

b. Upon recovery of money, whether partial or full, it shall be immediately distributed to the

investors in proportion to their holding in the segregated portfolio. Any recovery of amount

of the security in the segregated portfolio even after the write off shall be distributed to the

investors of the segregated portfolio.

c. An Action Taken Report (ATR) on the efforts made by the AMC to recover the investments

of the segregated portfolio is placed in every trustee meeting till the investments are fully

recovered/ written-off.

d. The trustees shall monitor the compliance of this circular and disclose in the half-yearly

trustee reports filed with SEBI, the compliance in respect of every segregated portfolio

created.

25

In order to avoid mis-use of segregated portfolio, trustees shall ensure to have a mechanism in

place to negatively impact the performance incentives of Fund Managers, Chief Investment Officers

(CIOs), etc. involved in the investment process of securities under the segregated portfolio,

mirroring the existing mechanism for performance incentives of the AMC, including claw back of

such amount to the segregated portfolio of the scheme.

Risk factors associated with creation of segregated portfolios

1. Liquidity risk – A segregated portfolio is created when a credit event occurs at an issuer level in

the scheme. This may reduce the liquidity of the security issued by the said issuer, as demand for

this security may reduce. This is also further accentuated by the lack of secondary market liquidity

for corporate papers in India. As per SEBI norms, the scheme is to be closed for redemption and

subscriptions until the segregated portfolio is created, running the risk of investors being unable to

redeem their investments. However, it may be noted that, the proposed segregated portfolio is

required to be formed within one day from the occurrence of the credit event.

Investors may note that no redemption and subscription shall be allowed in the segregated

portfolio. However, in order to facilitate exit to unit holders in segregated portfolio, AMC shall list

the units of the segregated portfolio on a recognized stock exchange within 10 working days of

creation of segregated portfolio and also enable transfer of such units on receipt of transfer

requests. For the units listed on the exchange, it is possible that the market price at which the units

are traded may be at a discount to the NAV of such Units. There is no assurance that a deep

secondary market will develop for units of segregated portfolio listed on the stock exchange. This

could limit the ability of the investors to resell them.

2. Valuation risk - The valuation of the securities in the segregated portfolio is required to be carried

out in line with the applicable SEBI guidelines. However, it may be difficult to ascertain the fair value

of the securities due to absence of an active secondary market and difficulty to price in qualitative

factors.

Investors are requested to refer to the SID to the respective scheme for details pertaining to

applicable NAV for redemption and switch outs, payment of redemption/repurchase proceeds and

Taxation and Stamp Duty payable.

26

Annexure B

Portfolios of the Schemes as on August 31, 2021:

A) ICICI Prudential Bharat Consumption Fund – Series 1:

ICICI Prudential Mutual Fund

ICICI Prudential Bharat Consumption Fund - Series 1

Portfolio as on Aug 31,2021

Company/Issuer/Instrument Name

ISIN Coupon Industry/Rating Quantity Exposure/Market

Value(Rs.L

akh)

% to Nav

Yield of

the

instr

ume

nt

Yield to Call @

Equity & Equity Related

Instruments (Note -1) 118053.21

84.0

6%

Listed / Awaiting Listing

On Stock Exchanges 118053.21

84.0

6%

Bharti Airtel Ltd.

INE397D01024

Telecom -

Services 1434974 9528.94

6.79

%

Titan Company Ltd.

INE280A01028

Consumer

Durables 484584 9311.77

6.63

%

Alkem Laboratories Ltd.

INE540L01014 Pharmaceuticals 220575 8555.22

6.09

%

Aditya Birla Fashion and

Retail Ltd. INE647O01011 Retailing 3484687 7251.63

5.16

%

Fortis Healthcare Ltd.

INE061F01013

Healthcare

Services 2182836 6341.14

4.52

%

Maruti Suzuki India Ltd.

INE585B01010 Auto 90750 6212.84

4.42

%

Motherson Sumi Systems Ltd.

INE775A01035 Auto Ancillaries 2614540 5715.38

4.07

%

Inox Leisure Ltd.

INE312H01016 Entertainment 1409608 4359.21

3.10

%

Gland Pharma Ltd.

INE068V01023 Pharmaceuticals 107879 4200.70

2.99

%

Nestle India Ltd.

INE239A01016

Consumer Non

Durables 21323 4151.11

2.96

%

Asian Paints Ltd.

INE021A01026

Consumer Non

Durables 128892 4126.28

2.94

%

Voltas Ltd.

INE226A01021

Consumer

Durables 391411 3897.87

2.78

%

Britannia Industries Ltd. INE216A01030

Consumer Non Durables 96109 3841.96

2.74%

Dr. Reddy's Laboratories Ltd. INE089A01023 Pharmaceuticals 72798 3424.45

2.44%

Hindustan Unilever Ltd. INE030A01027


2.16%

Sun TV Network Ltd.


2.13

%

Minda Industries Ltd.

INE405E01023 Auto Ancillaries 413534 2948.50

2.10

%

Marico Ltd.

INE196A01026

Consumer Non

Durables 487228 2652.71

1.89

%

Ashok Leyland Ltd.

INE208A01029 Auto 2091302 2567.07

1.83

%

Mahindra & Mahindra Ltd.

INE101A01026 Auto 303712 2409.35

1.72

%

V-Mart Retail Ltd.

INE665J01013 Retailing 57814 2077.63

1.48

%

Lupin Ltd.

INE326A01037 Pharmaceuticals 206962 1982.39

1.41

%

Divi's Laboratories Ltd.

INE361B01024 Pharmaceuticals 35587 1841.13

1.31

%

Blue Star Ltd.

INE472A01039

Consumer

Durables 216588 1678.45

1.20

%

PVR Ltd.


1.12

%

Apollo Tyres Ltd.

INE438A01022 Auto Ancillaries 631844 1345.51

0.96

%

Bharat Petroleum Corporation

Ltd. INE029A01011

Petroleum

Products 231792 1093.25

0.78

%

27

Tata Motors Ltd. - DVR

IN9155A01020 Auto 786999 1074.65

0.77

%

Biocon Ltd.

INE376G01013 Pharmaceuticals 274651 985.59

0.70

%

Ajanta Pharma Ltd.

INE031B01049 Pharmaceuticals 43344 965.62

0.69

%

ICICI Bank Ltd.

INE090A01021 Banks 113108 813.30

0.58

%

IPCA Laboratories Ltd.


0.51

%

Bajaj Consumer Care Ltd.

INE933K01021

Consumer Non

Durables 287024 705.65

0.50

%

Prestige Estates Projects Ltd.

INE811K01011 Construction 200000 705.30

0.50

%

EIH Ltd.

INE230A01023 Leisure Services 558740 572.15

0.41

%

Torrent Pharmaceuticals Ltd.


0.39

%

Hindustan Copper Ltd.

INE531E01026

Non - Ferrous

Metals 373305 444.05

0.32

%

The Indian Hotels Company

Ltd. INE053A01029 Leisure Services 300000 421.20

0.30

%

Aurobindo Pharma Ltd.


0.21

%

Indoco Remedies Ltd.

INE873D01024 Pharmaceuticals 58901 282.58

0.20

%

Sandhar Technologies Ltd. INE278H01035 Auto Ancillaries 81622 239.40

0.17%

Tamil Nadu Newsprint & Papers Ltd. INE107A01015 Paper 118695 160.06

0.11%

Andhra Paper Ltd INE435A01028 Paper 2982 6.78 ^

Unlisted Nil Nil

Debt Instruments Nil Nil

Listed / Awaiting Listing

On Stock Exchanges Nil Nil

Privately Placed/unlisted Nil Nil

Securitized Debt

Instruments Nil Nil

Term Deposits Nil Nil

Deposits (maturity not

exceeding 91 days) Nil Nil

Deposits (Placed as Margin) Nil Nil

Money Market

Instruments 1993.17

1.42

%

Certificate of Deposits Nil Nil

Commercial Papers Nil Nil

Treasury Bills

1993.17

1.42

%

364 Days Treasury Bills

IN002020Z253 SOV 1000000 998.14

0.71

% 3.10

91 Days Treasury Bills

IN002021X173 SOV 1000000 995.03

0.71

% 3.20

28

TREPS

12730.13

9.06

%

Units of Real Estate

Investment Trust (REITs) Nil Nil

Others 1365.00

0.97%

Cash Margin - Derivatives

1365.00 0.97

%

Net Current Assets

6293.41

4.48

%

Total Net Assets

140434.92

100.

00%

Details of Stock Future /

Index Future

Company/Issuer/Instrum

ent Name ISIN Coupon Industry/Rating Quantity

Exposure/

Market Value(Rs.L

akh)

% to

Nav

Stock / Index Futures

Hindustan Unilever Ltd. $$


3.40%

Asian Paints Ltd. $$


3.18%

Nestle India Ltd. $$


1.06%

Cipla Ltd. $$

Pharmaceuticals 154050 1460.63

1.04

%

Bharti Airtel Ltd. $$

Telecom -

Services -1390101 -9230.97

-

6.57

%

Note- 1 : Index/ Stock futures are provided towards end of the table.

Non-Convertible debentures / Bonds & Zero Coupon Bonds / Deep Discount Bonds / Certificate of Deposits / Commercial Papers are

considered as Traded based on the information provided by external agencies.

$$ - Derivatives.

^ Value Less than 0.01% of NAV in absolute terms.

For the Instrument/security whose final ISIN is yet to be assigned, disclosure of ISIN has been made as per the details

provided by external agencies.

@ As per AMFI Best Practices Guidelines Circular No. 91/ 2020 - 21 dated March 24, 2021 on Valuation of AT-1 Bonds and

Tier 2 Bonds, Yield to call is disclosed for AT-1 Bonds and Tier 2 Bonds issued by Banks as provided by Valuation agencies.

Number of Instances of Deviation In valuation Of Securities as per Sebi circular ref no SEBI/HO/IMD/DF4/CIR/P/2019/102

dated September 24, 2019- 1.Refer link: https://www.icicipruamc.com/docs/default-source/default-document-library/yes-

bank-valuation-16032020.pdf

B) ICICI Prudential Bharat Consumption Fund

ICICI Prudential Mutual Fund

ICICI Prudential Bharat Consumption Fund

Portfolio as on Aug 31,2021

Company/Issuer/Instrument Name ISIN Coupon Industry/Rating Quantity Exposure

/Market

Value(Rs

.Lakh)

% to

Nav

Yield of the

instrument

Yield to Call @

Equity & Equity Related Instruments

25009.2

9

94.80

%

Listed / Awaiting Listing On Stock

Exchanges

25009.2

9

94.80

%

Bharti Airtel Ltd.

INE397D01024 Telecom - Services 335226 2226.07 8.44%

ITC Ltd.

INE154A01025

Consumer Non

Durables 1032204 2181.05 8.27%

Bata India Ltd.

INE176A01028 Consumer Durables 121160 2146.71 8.14%

29

Britannia Industries Ltd.

INE216A01030 Consumer Non Durables 53501 2138.70 8.11%

Voltas Ltd.


Mahindra & Mahindra Ltd.

INE101A01026 Auto 237707 1885.73 7.15%

TVS Motor Company Ltd.

INE494B01023 Auto 221559 1163.52 4.41%

Hindustan Unilever Ltd.

INE030A01027

Consumer Non

Durables 41499 1130.47 4.29%

Gillette India Ltd.

INE322A01010

Consumer Non

Durables 19199 1117.33 4.24%

PVR Ltd.

INE191H01014 Entertainment 83367 1107.07 4.20%

Aditya Birla Fashion and Retail Ltd.

INE647O01011 Retailing 446306 928.76 3.52%

United Breweries Ltd.

INE686F01025

Consumer Non

Durables 61102 901.25 3.42%

United Spirits Ltd.

INE854D01024

Consumer Non

Durables 116845 835.62 3.17%

Maruti Suzuki India Ltd.

INE585B01010 Auto 12187 834.33 3.16%

Whirlpool of India Ltd.


Nazara technologies Ltd

INE418L01021 Entertainment 30387 558.16 2.12%

Asian Paints Ltd.

INE021A01026

Consumer Non

Durables 16579 530.75 2.01%

Bajaj Electricals Ltd.

INE193E01025 Consumer Durables 41589 505.04 1.91%

The Phoenix Mills Ltd.

INE211B01039 Construction 50124 432.44 1.64%

Sanofi India Ltd.

INE058A01010 Pharmaceuticals 4000 360.55 1.37%

Lupin Ltd.

INE326A01037 Pharmaceuticals 29904 286.44 1.09%

Titan Company Ltd.


Motherson Sumi Systems Ltd.

INE775A01035 Auto Ancillaries 100986 220.76 0.84%

Trent Ltd.

INE849A01020 Retailing 20318 204.58 0.78%

Burger King India Ltd

INE07T201019 Leisure Services 124009 199.96 0.76%

Eicher Motors Ltd.

INE066A01021 Auto 1346 36.06 0.14%

La Opala RG Ltd.

INE059D01020 Consumer Durables 7335 20.38 0.08%

Relaxo Footwears Ltd.

INE131B01039 Consumer Durables 1303 15.53 0.06%

Unlisted

Nil Nil

Debt Instruments

8.01

0.03

%

Listed / Awaiting Listing On Stock

Exchanges 8.01 0.03

%

Non-Convertible debentures / Bonds

8.01

0.03

%

Britannia Industries Ltd.

INE216A08027 5.5 CRISIL AAA 27397 8.01 0.03% 5.14

Privately Placed/unlisted

Nil Nil

Securitized Debt Instruments

Nil Nil

Term Deposits

Nil Nil

Deposits (maturity not exceeding 91

days) Nil Nil

Deposits (Placed as Margin)

Nil Nil

30

Money Market Instruments

Nil Nil

Certificate of Deposits

Nil Nil

Commercial Papers

Nil Nil

Treasury Bills

Nil Nil

TREPS

1600.49

6.07

%

Units of Real Estate Investment Trust

(REITs) Nil Nil

Net Current Assets

-236.40

-

0.90

%

Total Net Assets

26381.3

9

100.0

0%

Non-Convertible debentures / Bonds & Zero Coupon Bonds / Deep Discount Bonds / Certificate of Deposits / Commercial Papers are considered as

Traded based on the information provided by external agencies.

For the Instrument/security whose final ISIN is yet to be assigned, disclosure of ISIN has been made as per the details provided by

external agencies.

@ As per AMFI Best Practices Guidelines Circular No. 91/ 2020 - 21 dated March 24, 2021 on Valuation of AT-1 Bonds and Tier 2

Bonds, Yield to call is disclosed for AT-1 Bonds and Tier 2 Bonds issued by Banks as provided by Valuation agencies.

Number of Instances of Deviation In valuation Of Securities as per Sebi circular ref no SEBI/HO/IMD/DF4/CIR/P/2019/102 dated September 24, 2019- 1.Refer link: https://www.icicipruamc.com/docs/default-source/default-document-library/yes-bank-valuation-

16032020.pdf

ICICI Prudential Bharat Consumption Fund – Series 1 (A Close Ended Equity Scheme following

Consumption Theme) is suitable for investors who are seeking*:

• Long term wealth creation

• A close ended equity scheme that aims to provide capital

appreciation by investing in a well-diversified portfolio of stocks

that could benefit from growth in consumption and related

activities.

Riskometer#

Investors understand that

their principal will be at Very

High Risk

*Investors should consult their financial advisers if in doubt about whether the product is suitable for

them.

ICICI Prudential Bharat Consumption Fund (An open ended equity scheme following consumption

theme) is suitable for investors who are seeking*:

Long term wealth creation

An open ended equity scheme that aims to provide capital

appreciation by investing in equity and equity related securities of

companies engaged in consumption and consumption related

activities.

Riskometer#

31

Investors understand that

their principal will be at Very

High Risk

*Investors should consult their financial advisers if in doubt about whether the product is suitable for

them

# Riskometers are basis scheme portfolio as on August 31, 2021.

Mutual Fund investments are subject to market risks, read all scheme related documents

carefully.

Documents

Letter to Investors of ICICI Prudential Bharat Consumption