Birla SunLife Manufacturing Equity Fund

The Make in India program was launched by Prime Minister Naredra Modi in September 2014 as part of a wider set of nation-building initiatives. It was devised to transform India into a global design and manufacturing hub. The primary motive of the campaign is to encourage multinational as well domestic companies to manufacture their products in India. This would create more job opportunities, bring high-quality standards and attract capital along with technological investment to bring more foreign direct investment (FDI) in the country.

 

Why India as the next manufacturing destination?

 

The rising demand in India along with the multinational's desire to diversify their production to include low-cost plants in countries other than China, can help India's manufacturing sector to grow and create millions of jobs. In the words of our Honourable Prime Minister- Mr. Narendra Modi, India offers the 3 'Ds' for business to thrive— democracy, demography and demand. Today, Indian manufacturing companies in several sectors are targeting global markets and are becoming formidable global competitors.

 

Demographic Advantage

 

·         The country is expected to rank amongst the world's top three growth economies and amongst the top three manufacturing destinations by 2020

·         Favourable demographic dividends for the next 2-3 decades. Sustained availability of quality workforce

·         Strong consumerism in the domestic market

·         Strong technical and engineering capabilities backed by top-notch scientific and technical institutes

·         The cost of manpower is relatively low as compared to other countries

 

Other changes/developments for promoting manufacturing

 

·         Emphasis on infrastructure development (highest budgetary allocation to roads and railways in FY17 Union Budget)

·         Incentives offered for manufacturing

·         Improvement in ease of doing business

·         Skill India mission (multi-skill development programme for job creation and encouraging entrepreneurship)

·         Opening up FDI in Defence, Civil Aviation, Broadcasting Carriage Services, Pharmaceutical, Animal Husbandry, etc.

The country is witnessing a spate of positive changes in the economy, providing a much needed impetus to the industrial sector. For instance, a recent World Bank report pegs India to be the fastest growing economy in the world in the next three years, outpacing our neighbour country. McKinsey & Co highlights an upswing in India's manufacturing sector, which is poised to touch $ 1 trillion by 2025 and potentially account for 25-30 percent of the country's GDP, creating as many as 90 million jobs along the way.

 

BSL Manufacturing Equity Fund

 

Performance

 

BSL Manufacturing Equity Fund is India's first manufacturing oriented fund launched on 31^st Jan, 2015. Investors of BSL Manufacturing Fund have had a volatile journey since its inception due to global headwinds which have impacted the markets globally.  However it has managed to bounce back sharply within a short span of time and is currently delivering better returns than the benchmark index S&P BSE 500. The same can be inferred from the below graph:

 

During the Union Budget, necessary reforms were announced in order to attract more investments in India along with structural changes which have been put in place. This has lead to a gradual turnaround in the performance of the fund.

Source: Morningstar

 

Slowdown in US, consistent debt problems rising in Europe, deflation problems persisting in Japan, economic slowdown in China, Brexit referendum, etc. are some of the factors that have impacted the markets globally in the last 1 year. However investors who have continued to stay invested in the BSL Manufacturing Fund have seen a turnaround in the fund's performance. This indicates that investment made from a long term point of view along with sound fundamentals, deliver higher returns than the benchmark indices. In the last 1 year, BSL Manufacturing Fund delivered 1.80% compared to its benchmark S&P BSE 500 which delivered 1.15%. Fund has exposure to sectors which are focused towards the domestic economy. With an above average monsoon predicted for the current year along with implementation of 7^th Pay commission, Indian economy is expected to see a cyclical upturn thereby helping the overall manufacturing sector.

 

Portfolio

 

·         BSL Manufacturing fund remains true to its name and predominantly invests in companies that are engaged in manufacturing sector. With various reforms planned and initiated by the central government to grow the manufacturing sector of India, BSL Manufacturing intends to be a part of India's long term growth as a global manufacturing and design hub. Some of the top holdings of the fund include Tata Chemicals, Maruti Suzuki, Sun Pharmaceuticals, Larsen & Toubro, ITC Limited, etc.

 

·         Fund manager is overweight on sectors such as Automobile, Industrial Manufacturing, Pharma, Consumer Goods, Chemicals, Cement and Textiles. Fund's overweight stance on some of the above mentioned sectors have been positive contributors to the fund.

 

                                                    Data as on 30^th June 2016, Source: BSLAMC Internal Research

 

·         We continue to remain positive on Automobiles due to gradual improvement in growth rates of two wheelers, passenger cars and M&HCVs

 

·         Industrial manufacturing is expected to do well as the Power sector investments in the transmission space continues to grow while distribution would see uptick post UDAY reforms. Green energy & Emission based investment capex is at cusp of growth

 

·         In pharmaceuticals business, export momentum continues despite increased compliance requirements from US FDA and weak EM currencies. Consumer goods are expected to do well owing to implementation of 7^th Pay commission and an expected recovery in the rural economy

 

·         The fund has a portfolio turnover strategy of 3.52% which indicates the buy-and-hold strategy of the fund manager. The ratio represents the percentage of a fund's holdings that change every year. This signifies that the fund manager prefers having high-conviction stocks in the portfolio with a long term investment view

 

The various steps taken by the government in terms of measures for ease of doing business, creation of favourable environment for the manufacturing activities, focus on improving industrial policies and FDI enhancement would aid in reviving the manufacturing sector and achieving global competitiveness. Ultimately, the economic changes should contribute handsomely to the overweight sectors in the portfolio.

 

A strong proposition in current times

 

India is focusing on becoming a global manufacturing hub at a time when there is an economic slowdown in China. It must take advantage of this situation which can be a crucial contributor to the GDP. China is currently facing overcapacity issues and debt problems which is why they are shifting towards a more service oriented economy. On the other hand, setting up manufacturing centres in India will help generating employment, increase manufacturing and industrial output and help India to have a sustained economic growth in the years to come.

 

The government is opening various avenues for FDI investments in order to get the technical know-how and also urging multinational companies to set up their manufacturing facilities in India. Some of the local companies that have agreed to set up their manufacturing facilities are Celkon, Spice Group, Micromax while multinational companies include Samsung, Huawei, Foxconn, Xiaomi, Lenovo, Qualcomm, Vivo Mobiles, Oppo. Government is in talks with other global companies to make India as their manufacturing hub.

 

FDI money is flowing in India chasing growth coupled with an expected recovery in the rural economy. Government's thrust on infrastructure development along with a favourable monsoon will lead in consumption led recovery for the Indian markets. Recovery in rural economy coupled with implementation of 7th Pay commission is likely to add more stimuli to consumption growth.

 

BSL Manufacturing Equity Fund is a fund for investors who are seeking long term capital growth by investing in companies engaged in manufacturing sector and have a high risk appetite. However we believe the portfolio's sector exposure is in sweet spot to deliver higher risk-adjusted returns since it's the only fund in the industry specifically focusing on manufacturing companies. We advice investors to stay invested for atleast 3-5 years in order to reap the benefits.

Scheme Name

1 Year

Since Inception

Birla Sun Life Manufacturing Equity Fund - Reg - Growth

1.80

1.06

S&P BSE 500

1.15

-1.98

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Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

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Best 10 ELSS Mutual Funds in india for 2017

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Religare Tax Plan

4. DSP BlackRock Tax Saver Fund

5. Franklin India TaxShield

6. ICICI Prudential Long Term Equity Fund

7. IDFC Tax Advantage (ELSS) Fund

8. Birla Sun Life Tax Relief 96

9. Reliance Tax Saver (ELSS) Fund

10. Birla Sun Life Tax Plan

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Birla SunLife Small and Midcap Fund

Small cap stocks are not tracked closely by market analysts and that is why the real value of good small cap stocks can remain undiscovered for long. Also investing in them is risky due to unavailability of adequate research on them. But the rewards of finding a hidden gem are huge too, as such a stock may become a multibagger (midcap or even a large-cap stock over time), giving superlative returns.

 

BSL Small and Midcap Fund invests in equity and equity related securities of companies considered to be small and mid-cap and aims to achieve long term capital appreciation for its investors. The fund is declaring its annual dividend for FY 2016-17, an amount of Rs 1.85/unit (approx. dividend yield of 8.0% under Regular plan), record date being 31 August 2016. Following are few key features of this fund:

 

·         With an AUM of 268 crores the fund has generated returns of 12.73% since inception (as on Aug 25 2016)

 

·         In calendar year 2016 the fund has returned 16.12% outperforming the Nifty Free Float Midcap 100 by 3.4% which has generated returns of 12.7% (as on 25 Aug 2016)

 

·         A SIP of Rs 10000 since inception in the fund would be worth Rs 28.6 lacs (CAGR: 19.74%) against Rs 22.3 lacs (CAGR: 14.58%) in the Nifty Free Float 100 (as on 25 Aug 2016)

 

·         Over a 5 year period (daily rolling basis), since inception the fund has outperformed the Nifty Free Float 100 index 90.5% of the time and has generated positive returns 98% of the time (as on Aug 25 2016)

 

·         The fund has outperformed the benchmark across time periods as can be seen from the graph below:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

Top 10 Tax Saver Mutual Funds to invest in India for 2017

Best 10 ELSS Mutual Funds in India for 2017

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Religare Tax Plan

4. DSP BlackRock Tax Saver Fund

5. Franklin India TaxShield

6. ICICI Prudential Long Term Equity Fund

7. IDFC Tax Advantage (ELSS) Fund

8. Birla Sun Life Tax Relief 96

9. Reliance Tax Saver (ELSS) Fund

10. Birla Sun Life Tax Plan

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For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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Birla Sun Life Cash Manager Vs Bank Account

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Understanding Risk in Debt Mutual Funds

Debt Mutual Funds Online





Investors have made double digit returns in certain categories of debt funds over the last one year.
Financial planners suggest that investors be aware of the risks involved in debt funds and how mutual fund (MF) managers help lower these risks

1. What is interest rate risk?
How could it impact debt mutual fund investors?

Interest rate movement poses a risk to debt MF investors.

Interest rates typically rise when the economy is growing, and fall during economic downturns.Bond prices and interest rates are inversely related. When interest rates rise bond prices fall and vice versa.Usually , longer the maturity , greater the degree of price volatility . Interest rate risk is present in all debt funds but the degree could vary . Gilt funds with longer maturity , carry higher interest rate while it is negligible or very low in liquid funds, which invest in securities of up to 91 days maturity .

2. How can credit rating of a company affect a debt fund?

A credit risk is the risk of default on a debt security that may arise from a borrower failing to make required payments. If a default were to happen in the security of a portfolio, it would impact the fund to the extent of its weight in the portfolio. Bonds are assigned a credit rating by agencies such as Crisil, Care and Icra based on their ability to finance debt obligations and their cash flows. A corporate bond with an AAA equivalent rating is considered of the highest quality with negligible risk of default on payment of interest and repayment. Recently , Amtek Auto was downgraded by rating agencies, which affected debt fund schemes that had the paper in their portfolio. The fund manager regularly evaluates credit rating changes in the portfolio.

3. How crucial is liquidity & concentration for debt funds?

Concentration refers to the proportion of holding in one specific bond, higher the concentration in a particular security, higher the risk. For example, if you hold a 10% exposure in a single security and if it defaults, the NAV (net asset value) of the fund would fall to that extent. The fund manager also has to ensure the scheme is liquid to the extent that the fund has the ability to move in and out of a scheme without impacting its value or price. He ensures the scheme is liquid to manage large redemptions without having an impact on the NAV of the scheme.

-----------------------------------------------

Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

Top 10 Tax Saver Mutual Funds to invest in India for 2017

Best 10 ELSS Mutual Funds in India for 2017

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Religare Tax Plan

4. DSP BlackRock Tax Saver Fund

5. Franklin India TaxShield

6. ICICI Prudential Long Term Equity Fund

7. IDFC Tax Advantage (ELSS) Fund

8. Birla Sun Life Tax Relief 96

9. Reliance Tax Saver (ELSS) Fund

10. Birla Sun Life Tax Plan

Invest in Best Performing 2017 Tax Saver Mutual Funds Online

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

---------------------------------------------

Leave your comment with mail ID and we will answer them

OR

You can write to us at

PrajnaCapital [at] Gmail [dot] Com

OR

Leave a missed Call on 94 8300 8300

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Home Insurance Policy

Buy Home Insurance Policy Online

 1. What is home insurance policy?

Home insurance is a type of property insurance that covers losses caused by fire, natural disasters, burglary or terrorist attacks. The policy has two layers -it pays for re construction of the structure and for loss of contents in the accident.

Structure insurance would pay for physical structure of the build ing, home or apartment.

It does not pay the cur rent market value of the house or the building but only the cost to reconstruct it. Content insurance pays for belongings like furniture, televi sion, refrigerator and jewellery . Some policies also pay for alternative accommodation when the structure is being re constructed.

2. What are the exclusions?

In case of jewellery , there is a cap on how much an insurer pays under the policy . Home insurance policy pays for bur glary but not for losses due to theft. Also, one has to file an FIR to get claim. Second, insurer may not pay for the actu al value of content but the depreciated value.

3. Is it different from the policy bought by a housing society?

Housing societies generally buy insurance that covers the cost of reconstructing the structure of the building. The risk of damage to the content lies with the home owners.In very few cases, the builder or the society buys group property insurance.However, the exposure is limited.

4. What are the most common claims on home owner's policy?

Like motor insurance, home in surance is not mandatory .

Typically , insurers have seen huge home insurance claims from events like earthquake and floods. Most recently , the industry had paid for home insurance during the floods in Chennai.In India, the economic losses are six times that of insured losses. In 2015, there were 25 natural catastrophic events. According to a Swiss Re report, the severe flash floods in Chennai in November last year were the largest disaster, causing estimated economic losses of $2.2 billion whereas insured losses were around $755 million, making these floods the second costliest insurance event in India on sigma records.

5. How big is the industry and what are the parameters to look for while buying home insurance?

The home insurance industry is less than `500 crore. There are 33 crore houses in India, of which around 12 crore are insurable. The premium potential of home insurance is around `5 lakh crore. While buying home insurance policy , one must look into the level of cover required and the cost of items covered. One also needs to review contents every year, depending on the valuables added or value depreciated.

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Capital Gain Account Scheme

 





1 CGAS allows you to park sale proceeds of a property without capital gains tax liability, provided another property is bought within 2 yrs of sale or built within 3 yrs of the sale.

2 To be eligible for this exemption, account must be opened and funds must be deposited therein before the due date of filing of the seller's income tax return for the relevant financial year.

3 The account under CGAS must be opened with an urban or metro branch of any bank pre-specified by the government.

4 Sellers may open a Type A or Type B account. Type A works like a savings account and is suitable for those constructing a property.Type B works like a fixed deposit.

5 You can withdraw from CGAS by submitting an application in prescribed form. The funds must be utilized for payment towards property within 60 days of withdrawal.

6 Any unutilized funds lying in the account at the end of the prescribed period will be liable to income tax as capital gains.

For further information contact SaveTaxGetRich on 94 8300 8300

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My Tax app

The My Tax app is being developed in-house by the Income Tax Department.

The Income Tax Department will soon launch a mobile app that will act as a portal for almost anything I-T-related. From payments, tax deducted, to communications from the department, everything can be managed through the My Tax app.

It is being developed in-house, a government official. The individual's profile will be mapped to the permanent account number (PAN), allowing the collation of all tax-related information, including deductions by third parties, pertaining to that login. Taxpayers will also be able to respond to queries from the I-T Department or file complaints via the app, which is being developed by the Central Board of Direct Taxes (CBDT) to make the administration non-intrusive and taxpayer-friendly. It will complement similar initiatives by the board such as online scrutiny, which allows tax officials to seek details of transactions and get responses by e-mail.

The department recently unveiled Aaykar Setu, a new taxpayer service module that will have mobile and desktop versions. The app will provide various services such as PAN, TAN (tax deduction and collection account number) and tax payments.

The My Tax app will be personalised, but it's not clear whether tax-filing facilities will be available immediately.

The I-T Department is keen on the initiative as it believes convenience and simplicity are key to alleviating fear of the taxman and widening the tax base, having adopted the motto that taxpayers must be treated as customers.

Prime Minister Narendra Modi has sent a clear message to the tax authorities that they need to ensure that taxpayers do not fear the department.The department is working on a number of initiatives to improve its image.

The department is working on jurisdiction-free assessment, which means a taxpayer will not be linked to a particular ward or assessing officer. Assessment, if any, can be done anywhere in India, reducing the scope for interaction and harassment.