ADVICE for the WISE    Newsletter –December’11
ContentsIndex                        Page No.Economic Update                   4Equity Outlook                    8Debt Ou...
From the Desk of the CIO…Dear Investor,                                                                                   ...
Economic Update - Snapshot of                                      Key Markets                                            ...
Economy Update - Global            • The Conference Board Consumer Confidence Index, rose to 56.0 in November up from 40.9...
Economy Outlook - Domestic12.0%                     IIP monthly data                                                   • I...
Economic Outlook - Domestic             Growth in credit & deposits of SCBs                                               ...
Equity OutlookThe month of November saw a sharp fall of ten percent in Indian equity markets. There was significant amount...
Sector View       Sector     Stance                                                        Remarks                        ...
Sector View          Sector     Stance                                                       Remarks                      ...
Debt Outlook      9.4              Yield curve                                          10-yr G-sec yield                 ...
Debt Strategy   Category    Outlook                                    Details                             We recommend in...
ForexRupee movement vis-à-vis other currencies (M-o-M)                       Trade balance and export-import data         ...
Commodities            Though fundamental concerns still exist in the Eurozone,            31000                          ...
Real Estate Outlook - IAsset Classes                              Tier-1*                                                 ...
Real Estate Outlook - II       Asset Classes                                      Tier-1*                                 ...
Why Karvy Private Wealth?                                       Open Architecture – Widest array of products   We are an o...
DisclaimerThe information and views presented here are prepared by Karvy Private Wealth or other Karvy Group companies. Th...
Contact Us                                  Bangalore               080-26606126                                  Chennai ...
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Advice for the wise december 2011

  1. 1. ADVICE for the WISE Newsletter –December’11
  2. 2. ContentsIndex Page No.Economic Update 4Equity Outlook 8Debt Outlook 11Forex 13Commodities 14Real Estate 15 2
  3. 3. From the Desk of the CIO…Dear Investor, There seems to be a certain politico-economic brinkmanship that Germany and rest of the Eurozone countries seem to be engagedThe million dollar (more like Trillion Euro!) question everyone seems to in. This is precisely what makes us worry about the future of Eurobe asking is “will the Euro survive?” We believe that Euro’s survival has – and there is that small chance that the Germans may push theirbecome less certain than it was a month ago. Most of this is owing to fiscal prudence plans a little too far. This is what might cause thethe absence of a Fed-like response in Euro-zone to the present crisis. break-up of the Euro.This goes back to the deep-rooted ideological differences amongst theAnglo-Saxon economies and Germany. While the former believe in the The Indian domestic market sentiment has been less thanefficacy of monetary policy in managing the fallouts of crises, the latter cheerful due to the political logjam over retail FDI. The volte-faceinsists on fiscal prudence as the primary solution to the present crisis. by the opposition on their stance about retail FDI reminds us ofHence the western economists and leaders are busy cooking up one the age-old tendency within Indian politics for the opposition toidea after another of how Eurozone can go about fighting the crisis oppose everything nearly blindly. How the government deals withwith monetary policy tools – including Eurobonds, ECB’s Euro-printing this set-back and how much of its new-found resolve to continueand mutualization of sovereign debt within Eurozone. German with reforms survives this bickering is what will drive thegovernment on the other hand is skeptical of fighting debt problems macroeconomic momentum in next couple of quarters. Wewith more debt as well as continuing with “financialization” which expect a muddle-through scenario to continue for the next fewstarted most of the trouble in the first place. Apparently frustrated months.with Germany’s resolve to avoid printing of Euro by ECB, the group of 6central banks went ahead and offered low cost dollar credit lines to Inflation has fortunately remained out of the limelight – with theEuropean banks. This did prop up equity markets globally towards the RBI governor explicitly predicting a fall in inflation by the end ofend of November – also fuelling speculation that the end might be in FY12. We have now become cautiously positive on long termsight for the debt crisis in Euro-zone. debt. In the next 2-3 year horizon it would be a good idea to bet on interest rates to fall – this is best done through zero couponSome think that having the house on fire is a wrong time to be arguing long term quasi-sovereign bonds like NABARD and REC. Theabout repairing of the fire engine. Others suggest that the most expected returns can range between 8-10% p.a. if interest ratesimportant reforms happen typically during times of crisis (remember do not fall and 15%-20% p.a. if they do fall by 1%-2% over next 2-1991 in India!) 3 years.“Advisory services are provided through Karvy Stock Broking Ltd. (PMS) having SEBI Registration No: INP000001512. Investments are subject to market risks. Please read the disclaimer on slide no.18” 3
  4. 4. Economic Update - Snapshot of Key Markets Sensex Nifty 120 As on 30st Change over Change over 115 110 S&P 500 Nikkei 225 Nov 2011 last month last year 105 100 95 BSE Sensex 16123 (8.9%) (17.4%) 90 85 80 Equity S&P Nifty 4832 (9.3%) (17.6%) 75 markets S&P 500 (4.6%) 1.2% 1195 9.30 Nikkei 225 8435 (6.2%) (15.1%) 8.80 8.30 10 yr Gsec 7.80 7.30 6.80 10-yr G-Sec Yield 8.73% (29 bps) 54 bps 31-Dec-10 31-Aug-11 30-Nov-10 31-May-11 31-Jul-11 31-Oct-11 30-Nov-11 28-Feb-11 31-Mar-11 30-Sep-11 31-Jan-11 30-Jun-11 30-Apr-11Debt Markets Call Markets 8.55% 0 bps 295 bps 31000 29000 Fixed Deposit* 9.25% 0 bps 225 bps 27000 25000 23000 Gold 21000 19000 17000 RICI Index 3693 (1.2%) 2.0% 15000 Commodity Gold (`/10gm) 28841 6.0% 40.7% markets 54.00 Crude Oil ($/bbl) 111.5 3% 29% 52.00 50.00 48.00 `/$ 46.00 44.00 42.00 40.00 38.00 Forex Rupee/Dollar 52.2 (6.3%) (11.7%) 31-May-11 28-Feb-11 31-Mar-11 30-Sep-11 31-Jan-11 30-Jun-11 31-Dec-10 30-Apr-11 31-Aug-11 30-Nov-10 31-Oct-11 30-Nov-11 31-Jul-11 markets Yen/Dollar 77.9 (2.8%) 8.0%* Indicates SBI one-year FD 4
  5. 5. Economy Update - Global • The Conference Board Consumer Confidence Index, rose to 56.0 in November up from 40.9 in October signalling that consumers apprehension regarding the short-term outlook for US business conditions, jobs and income prospects has eased considerably. • Unemployment rate has fallen to 8.6% for the month of November from 9.0% in October . • The final Markit Eurozone Manufacturing PMI fell to 46.4 in November, from 47.1 in October, its lowest level since July 2009 and unchanged from the earlier flash estimate. The PMI has signalled contraction in each of the past four months. Europe • Greeces austerity-fuelled recession drove the budget deficit wider in October. The central government deficit grew by an annual 11 percent to 20.10 billion euros ($27.19 billion) in the first 10 months of the year • The seasonally adjusted Markit /JMMA Purchasing Managers’ Index (PMI) posted 49.1 in November, down from 50.6 in October, signalling a renewed deterioration in Japan manufacturing sector operating conditions. • Unemployment rate increased to 4.5% in October from 4.1% in Sept’11. Emerging • China’s HSBC PMI Index dropped at 47.7 in November from 51.0 in October, signalling aeconomies solid deterioration in manufacturing sector performance. Combined with faster than expected easing in inflation implies that growth is set to overtake inflation. 5
  6. 6. Economy Outlook - Domestic12.0% IIP monthly data • Indias economic growth rate slowed down further to 6.910.0% per cent in the second quarter (July-September) of FY12 as 8.0% compared to 8.9 per cent achieved in the same quarter of 6.0% the previous financial year. The GDP growth rate for Q1 and 4.0% Q2 FY11 was revised downwards to 8.1 and 8.4 respectively 2.0% from the previous estimates of 9.3 and 8.9%. 0.0% Sep Oct Nov Dec Jan 11 Feb Mar Apr May Jun 11 Jul 11 Aug Sep Oct 10 10 10 10 11 11 11 11 11 11 11 • This was attributed largely to the negative growth in ‘mining and quarrying’ and steep fall in the growth of• IIP figure declined for the third consecutive month to 1.9 per manufacturing sector, as compared to their levels of cent in September compared to 4% in the last month. During growth in Q2 of 2010-11. the April-September period this fiscal, IIP growth stood at 5 per cent-against 8.2 per cent in the same period last year. The • A steady rise in interest rates combined with stubbornly mining sector saw negative growth at (5.6%) in September’11 high inflation has impacted demand and credit sensitive as against the 4.3% growth in output in September’10. Capital sectors. The Reserve Bank has also reduced its forecast for goods registered negative growth at (6.8%) in September’11 real GDP growth from 8 to 7.6 per cent. The uncertainty in as against the 7.2% growth in September’10. The steep the global markets may also impact the exports and the decline in the capital goods segment highlights the service sector of the economy hence making the growth deceleration in the manufacturing sector. target difficult to achieve. GDP growth• The Industrial output in September’11 grew at the lowest rate 9.0 8.6 8.4 8.3 8.1 in the last two years, reflecting the slowdown in the country’s 8.0 7.8 7.7 pace of economic growth. In addition to the high interest 6.9 7.0 6.0 rates that has been impacting economic activity, the weak 6.0 global demand too has been stated to be intensifying the 5.0 slowdown in the economy. In addition, persistent high 4.0 inflation, rising input costs widening deficits and the FY10(Q3) FY10(Q4) FY11(Q1) FY11(Q2) FY11(Q3) FY11(Q4) FY12(Q1) FY12(Q2) weakening currency have been contributing in impeding the growth in industrial output. 6
  7. 7. Economic Outlook - Domestic Growth in credit & deposits of SCBs • The Wholesale Price Index was reported at 9.7330.0% Bank Credit Aggregate Deposits percent in Oct’2011 vis-à-vis 9.72% in25.0% September‘11. Food and fuel prices posted20.0% double-digit growth of 11.06% and 14.79%15.0% respectively. The manufacturing WPI steadied10.0% above 7.66 percent from 7.69% last month 5.0% • With the monetary tightening stance by RBI, we do expect WPI inflation numbers to moderate • The credit grew 19.6% on a y-o-y basis while out eventually. deposits grew at ~18% in October. • Owing to the successive increase in the cost of borrowing, a moderation has been seen in the credit 10.0% Wholesale Price Index growth and the current estimate for the Fiscal is ~ 9.5% 17-19%. 9.0% • On account of the slowing growth in the economy 8.5% and the expected decrease in inflation by December, 8.0% it is expected that the RBI will pause any interest 7.5% rate hikes. * End of period figures 7
  8. 8. Equity OutlookThe month of November saw a sharp fall of ten percent in Indian equity markets. There was significant amount of volatility on theback of fresh concerns about the fiscal health of Euro area countries. FIIs sold almost a billion dollars worth of their holdings. Rupeeweakened sharply against the dollar which added to the nervousness.In Europe, sentiment turned for the worse after the German bond auction received a poor response. There were concerns that thefinancial health of peripheral euro area countries has started affecting even the core of Germany and France. The French bond yieldshave continued to spike and the spread between French and German yields in now close to 2%. There is an increasing amount of talkabout French rating being downgraded. The five and ten year Italian bond yields have spiked up and remained above 7%. Italy isfacing an enormous amount to pressure to cut its deficit and saw a new government being sworn in. However, investors continue towait for a definitive move towards the euro bonds barring which volatility in Europe might continue for an elongated period of time.Final number for third quarter GDP data in US came in at 2%, below the earlier estimated 2.5%. Macro-economic indicators in UScontinue to be positive and have eased concerns about US economy moving towards a double-dip recession. US consumer demandhas been holding up so far and the Black Friday retail sales numbers where quite impressive. The ISM manufacturing index forNovember came in at 52.7 which shows robust growth. As of now, there are no indicators of any recessionary trend in US economy.The second quarter GDP growth rate in India came in at 6.9%, lowest in nine quarters. This number has confirmed a significantslowdown in manufacturing and industrial activity in the country. We expect the growth to weaken further in next quarter. RBI haseffectively hiked rates by 500 bps in last sixteen months and that is showing in the growth numbers. We believe that RBI would refrainfrom any further tightening and weak growth numbers would force RBI to start the easing cycle earlier than expected. Considering avery tight liquidity scenario, a CRR cut is a distinct possibility. The rupee continued its slide to 52.5 before RBI invented to provide some stability. Rupee has been one of the worst performingAsian currency due to high current account deficit that the country is running. We believe that the current rupee levels provide a veryexciting entry opportunity in equity markets for dollar investors. The last set of second quarter earnings were disappointing. Rupeedepreciation has also resulted in forex losses. Several companies have seen a huge hit to bottom lines due to high interest rates andcommodity prices. We expect the softness in earnings to remain for at least one more quarter. However, Markets have alreadydiscounted a lot of potential negatives and further correction in stock prices might be limited.While interest rate and inflation cycle might turn for the positive in next few months, Global cues will play an important role indeciding the market direction in the short term. 8
  9. 9. Sector View Sector Stance Remarks We believe in the large sized opportunity presented by Pharma sector in India. India’s strength in generics is difficult to replicate due to quality and quantity of available skilled manpower. With the developed world keen to cut healthcare costs, and a vast pipeline of drugs going off-patent, Indian pharma players are at theHealthcare Overweight cusp of rapid growth. We would bet on the opportunity in Generics and CRAMS space We prefer “discretionary consumption” beneficiaries such as Cigarettes and branded garments, as the growth in this segment will be disproportionately higher vis-à-vis the increase in disposable incomes.FMCG Overweight Financial sector is undeniably the lubricant for economic growth. Whether the growth comes from consumption or investments, credit growth is inevitable. Being a well regulated sector, BFSI in India has goodBFSI Neutral asset quality and capital adequacy ratios. Despite the increasing in interest rates, we believe banks will be able to pass on higher cost of funds to clients as demand remains strong Demand outlook remains robust with strong earnings growth. Raw material prices have started comingAutomobiles Neutral down which would boost margins. We are more bullish on two-wheeler and agricultural vehicles segment due to lesser competition and higher pricing power. The regulatory hurdles, competitive pressures and leverage prevent any return to high profitability levels in the short to medium term. However, incumbents have started to increase tariffs slowly and we believe thatTelecom Neutral consolidation will happen sooner than expected. 9
  10. 10. Sector View Sector Stance Remarks Commodity prices have corrected significantly over the last few months due to concerns about growth inMetals Neutral developed parts of the world. We believe the commodity prices will bounce back once growth recovers and hence would be positive on industrial metals space. We like the regulated return charteristci of this space. This space provides steady growth in earnings andPower Utilities Neutral decent return on capital. IT space might come under pressure due to continued concerns about growth in developed parts of theIT/ITES Underweight world. While US and European customers of Indian IT companies are in good health, Order inflows might slow down in near term We would stay away from oil PSUs, due to issues of cross subsidization distorting the underlyingEnergy Underweight economics of oil exploration and refinery businesses. Cement demand will certainly grow over the next three years. But the issue is on the supply side. We doCement Underweight see an oversupply situation for the next 3-4 quarters. The USD 1 trillion Infra opportunity is hard to ignore. However, The significant slowdown in order inflow activity combined with high interest rates has hurt the sector. We will review the stance once the interestE&C Underweight rate cycle gets reversed 10
  11. 11. Debt Outlook 9.4 Yield curve 10-yr G-sec yield 9.30 9.2 8.80 9.0 8.30 8.8 7.80 8.6(%) 7.30 8.4 6.80 8.2 4.4 0.0 0.9 1.8 2.7 3.5 5.3 6.2 7.1 8.0 8.8 9.7 10.6 11.5 12.4 13.3 14.1 15.0 15.9 16.8 17.7 18.5 19.4 • The 10 year benchmark G–Sec yield decreased by 29 bps in October to close at 8.73%. • The shorter term papers rallied to close at 8.71 percent for a tenor of one year while medium term paper yields decreased to 8.68 percent after a sharp rally last month. The one year AAA rated corporate bond yields were at 9.8 percent while the ten year bonds traded at 9.89%. • Though no easing has been seen in the inflation figures, a pause is expected by the RBI and no hike may be seen in the immediate future though the central bank would monitor the inflation closely. • Advance tax outflows in December may tighten the liquidity in the system further and the bond market may witness temporary hardening of yields. 11
  12. 12. Debt Strategy Category Outlook Details We recommend investment into short term bond funds with a 6-12 month investment horizon as we expect them toShort Tenure deliver superior returns due to high YTM. We have seen the Debt short term yields harden due to reduced liquidity and consecutive rate hikes prompted by inflationary pressures. Till these factors do not stabilize, we see Short term bond funds and FMPs as an interesting investment option. Some AA and select A rated securities are very attractive at the current yields. A similar trend can be seen in the Fixed Credit Deposits also. Tight liquidity in the system has also contributed to widening of the spreads making entry at current levels attractive. RBI hiked the interest rates for the 13th time since march 2010 by 25 Bps, the repo rate now stands at 8.5% and reverse repo at Long Tenure 7.5%. RBI has shown an intention to pause further rate hikes. Our stance on long term debt remains neutral and we believe Debt that it may be a good time to start looking for interesting investment opportunities in the medium term. 12
  13. 13. ForexRupee movement vis-à-vis other currencies (M-o-M) Trade balance and export-import data 100 0 Export Import Trade Balance (mn $) -5000 0.0% 50 -10000 -1.0% USD GBP EURO YEN -15000 0 -2.0% -20000 -50 -25000 -3.0% -4.0% • India’s exports grew 10.8 percent in October, while imports -5.0% grew by 21.7 percent. Impacted by the uncertainty in the global markets, a drastic decrease has been seen in the exports hence -6.0% increasing the trade deficit to a four year high of USD 19.6 -7.0% billion. 140000 Capital Account Balance• The INR has depreciated across all major currencies in 90000 the month. The Rupee started depreciating against the USD from August 2011 and settled at Rs 52.10/ USD, as 40000 on November 23, 2011. This was a decrease of 18.28% since August 2011. -10000 FY 10 (Q2) FY 10 (Q3) FY 10 (Q4) FY 11 (Q1) FY 11 (Q2) FY 11 (Q3) FY 11 (Q4) FY 12 (Q1)• The major drivers for the INR to depreciate have been : Withdrawal by FIIs, Strengthening of the USD, widening • Capital account balance was positive throughout FY11 and current account deficit and lack of other capital inflows stood at `273133 Cr. at the end of the year. For FY 12, the capital account is at `93,621Cr. for Q1. like FDI etc. • We expect factors as higher interest rates to attract more• With winter, the demand for oil and consequently dollar investments to India. Increased limits for investment by is only expected to move further upwards. FIIs would also help in bringing in more funds though uncertainty in the global markets could prove to be a dampener. 13
  14. 14. Commodities Though fundamental concerns still exist in the Eurozone, 31000 Gold 29000 the group of 6 central banks have offered low cost dollar 27000 25000 credit lines to European banks. In the domestic market, the 23000Precious fundamental factors largely remained unchanged and 21000 19000 Indian markets had seen fresh buying demand during the 17000 Metals festive Diwali Season despite prices staying higher. If the 15000 31-Aug-11 30-Nov-10 31-Jan-11 30-Apr-11 30-Nov-11 31-Mar-11 30-Jun-11 31-Jul-11 28-Feb-11 31-May-11 30-Sep-11 31-Dec-10 31-Oct-11 current solution paves the way for a solution to the crisis and if globally, the currencies strengthen, we may witness a slight dip in the Gold prices as gold is inversely correlated to the greenback hence providing a hedge. 130.0 Crude The recent bout of global uncertainty have pressurized 120.0 110.0 crude oil amid concern of double dip recession in the US 100.0 and global economy slipping into red. We expect crude oil 90.0 80.0Oil & Gas prices have topped out in the interim and can only move 70.0 down from here on. We have seen some firmness in the 60.0 31-Aug-2011 31-Dec-2010 31-Oct-2011 30-Nov-2010 31-May-2011 30-Nov-2011 31-Jul-2011 31-Jan-2011 28-Feb-2011 31-Mar-2011 30-Sep-2011 30-Apr-2011 30-Jun-2011 prices post the announcement of Greece bailout package, nevertheless, any such temporary uptick shall not be sustained. Expect crude oil prices to be steady. 14
  15. 15. Real Estate Outlook - IAsset Classes Tier-1* Tier-II** Strong pre-launch sales still keeps the developers far from The demand is keeping the Tier II cities afloat, the any correction, though sales are down to alsmost 35% infrastructure development in these cities have made the since last quarter, there is no correction visible. The over- residential development spread across the city limits. On supplied locations are stagnant and would be similar for an average price is still affordable. Key development the coming 2 quaters. Entry points anywhere from Rs. developer are seeing demand of 3BHK and luxury 3000 - Rs. 6000 per sqft in cities like Pune, NCR, development but are only doing well if the project size is Residential Hyderabad, Chennai and Bangalore are still considred limited to 100-150 units. The trend seems to be favorable lucarative by first time home -buyers depending on their since there is lot of Investor demand comes from smaller usage. The retail investors (2nd home buyers) and HNI cities closer to these Tier-II & III cities. Excellent time to investors vary or delaying their decision with expectation buy anything between Rs. 3000-3500 sqft with known of correction. Mumbai stands still tall with prices on their developers. peak in over-supplied market also. Correction again are reported only on media and not on ground level. Advice Price point entry is the key. Good time to sell. Time right to buy, look at 3-8 acre developments only Still in the shadows of over-supply and cautious expansion Commercial segment not that significant, but unlike Tier-I approach by corporate, this segment has gone through the price differentiation is double favoring commercial correction. Rates per sqft have seen almost 30% down- since most of them are in CBD areas. trend and will be stagnant for the coming 2-3 quarters.Commercial/IT Surely, the segment is at the down-tip of the cycle, and is the best opportunity for companies looking for long term holding of real estate office space. Advice Excellent time to buy smaller office spaces at CBD areas Space not defined well, depends on independent needs. 15
  16. 16. Real Estate Outlook - II Asset Classes Tier-1* Tier-II** The FDI allowance is given lot of impetus to this Retail is slow in these markets; unorganized markets sector, its been now almost 3 years since retail has are still a hot choice. Most high-street locations are seen a major transformation on all its business expensive to own thus have a high lease rental and aspects and have been built to suit Indian way for have witnesses heavy churn. Investment would consumerism. Low cost, high reach, heavy variety, always have capital protected due to dearth of Retail less innovation, existence with competition, available space.. maximizing bottom line than top-line approach have been making the retailers smarter. Revenue share model with a built in MG is how the deals are done Most interesting times, traded now more as Still available cheaper, plotted development is a hit commodity, very fastly getting absorbed, locked. since the trend of standalone homes are prevalent. Non-real estate sector see immense opportunity Land since it can be used as tangible and most credible pledge against business Advice Hold Land, if Owned Hold Land, if Owned1. Tier I* markets include Mumbai, Delhi & NCR, Bangalore, Pune, Chennai, Hyderabad and Kolkatta2. Tier II* markets includes all state capitals other than the Tier I markets3. The IC note is proposed to be presented every quarter 16
  17. 17. Why Karvy Private Wealth? Open Architecture – Widest array of products We are an open-architecture firm at two levels – asset class level and product level : • Offering COMPREHENSIVE choice of investing across all asset classes • Offering EXTENSIVE choice of multiple products from different product providers under each asset class Intensive Research We closely track the historical performance across asset classes, sub-asset classes and product providers to identify, evaluate and recommend investment products (KPW’s or third-party). We have our own proprietary methodology for evaluating products; for product providers, we also note the investment style and risk management philosophy. Our comprehensive analysis determines truly exceptional performers to be added to your portfolio Honest, unbiased adviseGroup-wide, we have no Mutual Fund or Insurance products of our own unlike most of the financial services groups (banks orbroking houses), who are doing wealth management. Neither do we have exclusive tie-up with any single insurance company likeall banks do. The KPW 3-S Service promise: When you become a Client of KPW, besides getting intelligent & practicable Investment Advice, you get the benefit of “The KPW 3- S Service Promise” : • Smooth and Hassle Free – Attention, Service & Convenience • Sharp and proactive – Portfolio monitoring and tracking • Smart –Incisive insights on markets and Investment products Pedigreed Senior Management Team A talented team of leaders with global and Indian experience, having a unique blend of backgrounds of wealth management, private equity, strategy consulting and building businesses powers Karvy Private Wealth and its operations. 17
  18. 18. DisclaimerThe information and views presented here are prepared by Karvy Private Wealth or other Karvy Group companies. The information containedherein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completenessthereof. This material is for personal information and we are not responsible for any loss incurred based upon it.The investments discussed or recommended here may not be suitable for all investors. Investors must make their own investment decisionsbased on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While actingupon any information or analysis mentioned here, investors may please note that neither Karvy nor any person connected with any associatedcompanies of Karvy accepts any liability arising from the use of this information and views mentioned here.The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above-mentioned companies fromtime to time. Every employee of Karvy and its associated companies are required to disclose their individual stock holdings and details of trades,if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling ofshares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. Allemployees are further restricted to place orders only through Karvy Stock Broking Ltd.The information given in this document on tax are for guidance only, and should not be construed as tax advice. Investors are advised to consulttheir respective tax advisers to understand the specific tax incidence applicable to them. We also expect significant changes in the tax laws oncethe new Direct Tax Code is in force – this could change the applicability and incidence of tax on investmentsKarvy Private Wealth (A division of Karvy Stock Broking Limited): Operates from within India and is subject to Indian regulations.Mumbai office Address: 702, Hallmark Business plaza, Sant Dnyaneshwar Marg, Bandra (East), off Bandra Kurla Complex, Mumbai 400 051(Registered office Address: Karvy Stock Broking Limited, “KARVY HOUSE”, 46, Avenue 4, Street No.1, Banjara Hills, Hyderabad 500 034)SEBI registration No’s:”NSE(CM):INB230770138, NSE(F&O): INF230770138, BSE: INB010770130, BSE(F&O): INF010770131,NCDEX(00236,NSE(CDS):INE230770138, NSDL – SEBI Registration No: IN-DP-NSDL-247-2005, CSDL-SEBI Registration No:IN-DP-CSDL-305-2005, PMS RegistrationNo.: INP000001512” 18
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