Advice For The Wise - November'2011


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October turned out to be a rather positive and optimism inducing month - with most positive global news coming in along with the adaptation of dovish stance by RBI.

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Advice For The Wise - November'2011

  1. 1. ADVICE for the WISE Newsletter –November’11
  2. 2. ContentsIndex Page No.Economic Update 4Equity Outlook 8Debt Outlook 11Forex 13Commodities 14Real Estate 17 2
  3. 3. From the Desk of the CIO…Dear Investor,October turned out to be a rather positive and optimism Debt markets have regained some of their shine with theinducing month - with most positive global news coming in end in sight for the monetary policy tightening. In light ofalong with the adaptation of dovish stance by RBI. The festive the RBI statement on the eve of policy announcement, weseason helped maintain a positive sentiment. While the results believe that long term corporate and quasi-governmentof several listed companies disappointed investors, especially debt has now become attractive to invest in. While thein the infrastructure space, the beginning of the end of interest rates may yet go up slightly after a brief pause,monetary policy tightening has rekindled investors hopes. they are near their peak and investors can start to buy long tenor bonds and long term debt mutual funds.European governments (especially French and German) havecontinued to test the limits of global financial system as they Looking back at the year gone by so far, one would noticedither, argue about and re-re-redraft the comprehensive the large movements in gold, US Dollar in the positiverescue plan for the troubled governments of Greece, Portugal, direction while equities in the negative direction. That gotSpain and the pre-emptive action to avoid larger ones like Italy us thinking about whether these assets can be combinedfrom losing market access. With their self imposed deadline of into a portfolio which is optimized dynamically - with thethe November 3rd G20 summit for reaching a consensus on intention of minimizing risks for a good return. We havethe rescue plan drawing near, there are positive signs of action designed just the right portfolio for this. This month wein the major European capitals. We continue to believe that are launching Pi - our multi asset quant fund. The simpleEuro as a currency will survive, Greece may default (though idea of Pi is to make sure that investors wealth growsindirectly and partially) while Portugal et al will not. Due to a year on year on the back of appreciation of one or moredisorderly default in a Greece or a failure to reach any decisive of its constituent asset classes i.e. equities, commodities,plan for rescue of others there might be significant downside gold and equity markets; however the likelihood of this happening islower than 10%.“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.20” 3
  4. 4. Economic Update - Snapshot of Key Markets Sensex Nifty 125 As on 31st Change over Change over 120 115 S&P 500 Nikkei 225 Oct 2011 last month last year 110 105 100 BSE Sensex 17705 7.6% (11.2%) 95 90 85 Equity S&P Nifty 5326 7.8% (11.5%) 80 75 Markets S&P 500 1284 13.5% 8.6% 9.30 Nikkei 225 8522 (2%) (7.4%) 8.80 8.30 10 yr Gsec 7.80 7.30 6.80 10-yr G-Sec Yield 8.88% 44 bps 73 bps 29/Jan/11 30/Jun/11 29/Oct/10 30/Apr/11 31/Oct/11 28/Feb/11 31/Mar/11 31/Jul/11 31/May/11 29/Sep/10 29/Nov/10 29/Dec/10 31/Aug/11 30/Sep/11Debt Markets Call Markets 8.60% 30 bps 160 bps 30000 28000 Fixed Deposit* 9.25% 0 bps 225 bps 26000 24000 Gold 22000 20000 RICI Index 3463 7.9% 6.0% 18000 Commodity Gold (`/10gm) 27475 5.7% 38.1% Markets 51.00 50.00 Crude Oil ($/bbl) 108.4 3% 34% 49.00 48.00 47.00 `/$ 46.00 45.00 44.00 43.00 42.00 41.00 40.00 Forex Rupee/Dollar 48.9 0.1% (8.9%) 31/Oct/10 30/Apr/11 31/Jul/11 31/Oct/11 28/Feb/11 31/Mar/11 31/May/11 31/Jan/11 30/Jun/11 30/Sep/10 30/Nov/10 31/Dec/10 31/Aug/11 30/Sep/11 Markets Yen/Dollar 78.3 (2.2%) 2.7%* Indicates SBI one-year FD 4
  5. 5. Economy Update - Global • An annual expansion of 2.5% in the third quarter of 2011 has pushed American GDP back to pre-recession levels after 15 quarters, according to figures released last week. US • United States’ Consumer Confidence for the month Oct 2011 is at 39.80, which has dipped from 46.40 in September 2011. • Greece’s debt will be reduced, private banks and insurer are asked to accept 50 percent losses on the Greek bond holdings, and the rescue fund EFSF will be strengthened, supported also by non-European investors Europe • The CPI rose 0.6% in September increasing the inflation for the year to 5.2% higher from an expected estimate of 4.9%. The inflation number is the highest since Sept 2008 • The seasonally adjusted Markit /JMMA Purchasing Managers’ Index (PMI) posted 50.6 in October, up from 49.3 in September, signalling a marginal improvement in manufacturing Japan sector operating conditions. A level over 50 also signifies growth while a level below 50 indicates contraction. • The jobless rate slid to 4.1% from 4.3% in Sept’11, and the core food inflation was steady at 0.2%. Emerging • China’s HSBC PMI Index came in at 51.0(Oct’11), a solid rebound from the 49.9 recorded ineconomies September to mark the first rise above the 50 level that demarcates contraction from expansion since June’11. 5
  6. 6. Economy Outlook - Domestic 16.0% IIP monthly data • The GDP growth rate for Q1 FY12 came in at 7.7%, the 14.0% weakest in last 6 quarters. The growth was seen at 7.8% in 12.0% 10.0% the last quarter. The economic growth for FY11 was 8.5% 8.0% backed by improved farm output and growth in the 6.0% services sector. 4.0% 2.0% • "While the manufacturing sector grew 7.2 percent in April- 0.0% June from a year earlier, construction was a dark spot in Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug 10 10 10 10 10 10 11 11 11 11 11 11 11 11 the data, rising just 1.2 percent annually, down from 7.7 percent a year earlier, as higher interest rates dampened• IIP figure came in at 4% which was lower than the the housing market and big-ticket projects were plagued by consensus of 4.4%. A look at the subsectors clearly points delays in approvals. Mining output grew 1.8 percent, to a broad-based slowdown of sub-4% YoY growth across sectors. Apart from electricity which continues to grow at compared with 7.4 percent a year ago while Financing, close to double digits (9.5% YoY), manufacturing (4.5% insurance, real estate and business service grew 9.1 percent YoY) and mining (-3.4% YoY) continued to disappoint. On versus 9.8 percent a year ago. the user side, capital goods remained volatile growing at • A steady rise in interest rates combined with stubbornly 3.9% YoY in Aug-11. high inflation would impact demand and credit sensitive sectors making a growth target of 8% difficult to achieve.• Revisions for July are significant in mining, manufacturing and consumer goods sectors. Overall IIP growth was revised upwards from 3.3% YoY to 3.8% YoY. 10.0 GDP growth 9.0• The IIP figures have been very volatile in the last year and 8.0 especially after the introduction of the new series. We believe that monthly indicators and IIP in isolation may 7.0 not a very efficient way of indicating long term growth. 6.0 We expect the growth to eventually moderate out though 5.0 high input costs may be a dampener for the manufacturing sector. 4.0 FY10(Q2) FY10(Q3) FY10(Q4) FY11(Q1) FY11(Q2) FY11(Q3) FY11(Q4) FY12(Q1) 6
  7. 7. Economic Outlook - Domestic Growth in credit & deposits of SCBs • The inflation rate in India was reported at 10.1 Bank Credit Aggregate Deposits percent in Sept’2011 vis-à-vis 9.78% in 30.0% August‘11. Food inflation, as measured by the 25.0% Wholesale Price Index (WPI), stood at 12.21% 20.0% 15.0% on the week ending 22nd Oct’11 vis-à-vis at 10.0% 13.55% in the corresponding week of the 5.0% previous year. • With the monetary tightening stance by RBI, we do expect WPI inflation numbers to moderate • The credit grew 23% on a y-o-y basis while deposits out eventually. grew at ~21% in September. Even though RBI has been raising interest rates, an increase was seen in personal loans. 10.0% Wholesale Price Index • Due to the successive increase in the cost of 9.5% borrowing, a moderation has been seen in the credit 9.0% growth and the current estimate for the Fiscal is ~ 8.5% 17-19%. 8.0% • On account of the slowing growth in the economy 7.5% and the expected decrease in inflation, a pause is expected in the interest rate hikes.* End of period figures 7
  8. 8. Equity OutlookThe last of October saw a sharp rally in risky assets across the world on statement by the Governor remains has changed from hawkish to dovishthe back of the three –pronged agreement reached by European Union with growth continuing to remain under pressure. The governor talkedpolitical leadership to stem the contagion from the soverign-debt crisis: A about ‘De-sesonalized quarter-on-quarter headline and core inflationvoluntary 50% hair cut for private investors in Greek debt which would measures showing moderation’. According to RBI, inflation will starthelp reduce soverign debt in greece, Recapitalizing seventy European falling in December and will moderate to about 7% by March 2012. Thebanks to the extent of 108 billion dollars and increasing the size of Governor also said that ‘likelihood of a rate action in December mid-European Union Financial Stabilty Fund (EFSF) to 1.4 trillion dollars which quarter policy review is relatively low’. RBI has cut the FY12 growthwould provide support to other peripheral Euro area countries.. All the forecast from 8% to 7.6%. RBI has effectively hiked rates by 525 bps inthree measures combined with further fiscal austerity measures were last sixteen months and this could result in demand destruction leadingsupposed to stem the contagion in European markets. to price moderation. Our own sense is that considering the significant slowdown in growth expectation, Rbi will definitely pause if not end theThe Greek Prime minister announced that he will put the bailout package rate tightening cycle now.given to Greece through a referendum due to lack of political consensusin Greece. The referendum is expected to happen in the month of FII’s put in 2500 of fresh money into Indian equity markets whichDecember and will decide if Greece will accept the terms of the bailout resulted in markets rallying almost 7%.The rupee after depreciatingpackage. It is our view that for Euro area to sustain, sooner or later, almost 13% to 50 levels has bounced slightly and stabilized around 49European governments will have to move towards some kind of fiscal mark. We believe this provides a very exciting entry opportunity in equityunion to prevent a full-blown crisis. A move in the opposite direction markets for dollar investors. The second quarter earnings have come incould have huge economic and political costs. on expected lines. The earning season has been led by private sector banks, FMCG and automobiles. ITC and HUL came in with excellentThird quarter GDP data in US came in at 2.5%, above consensus results and both are trading at life time highs. We continue to remainexpectations which eased concerns about US economy moving towards a positive on FMCG names as consumption demand remains quite strong.double-dip. The dollar Index fell 5% resulting in sharp bounces in equity, PSU banks continue to face pressure on the asset quality with powercommodities and crude oil. In this month’s US Fed meeting, the markets books coming under great pressure. Also, Infra companies continue towill look for any indication of further quantitative easing although Fed face pressure due to high interest rates and lack of new orders.Chairman continues to mention that Fed has several tools available attheir disposal to spur growth and they will use it as and when required. With interest rates peaking out and inflation also expected to startUS consumer demand has been holding up so far and the Thanksgiving coming down in next few months, we expect that the coming monthsholiday buying will give a good indicator of how that demand will move should see improvement in equity market sentiment. We advisefrom here onwards. investors to stay invested and build a longer term equity portfolio.RBI hiked repo rates by 25bps on 25th October. The tone of the policy 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 theHealthcare Over weight developed world keen to cut healthcare costs, and a vast pipeline of drugs going off-patent, Indian pharma players are at the 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 FMCG Over weight growth in this segment will be disproportionately higher vis-à-vis the increase in disposable incomes. The USD 1 trillion Infra opportunity is hard to ignore. We believe Power sector to be a better play over other sub sectors such as ports, roads and telecom infrastructure, because of favorable economics E&C Neutral under PPP model. Within power, we like the engineering companies and utilities over T&D and other infrastructure owners because of their superior profitability and better competitive dynamics. 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 BFSI Neutral good 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 The regulatory hurdles, competitive pressures and leverage prevent any return to high profitability levels Telecom Neutral in the short to medium term. However, incumbents have started to increase tariffs slowly and we believe that consolidation will happen sooner than expected. 9 9
  10. 10. Sector View Sector Stance Remarks Demand outlook remains robust with strong earnings growth. Raw material prices have startedAutomobiles Neutral coming down which would boost margins. We are more bullish on two-wheeler and agricultural vehicles segment due to lesser competition and higher pricing power. Commodity prices have corrected significantly over the last few months due to concerns about Metals Neutral growth in 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 would stay away from oil PSUs, due to issues of cross subsidization distorting the underlying Energy Under weight 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. Cement Under weight We do see an oversupply situation for the next 3-4 quarters. IT space might come under pressure due to continued concerns about growth in developed parts of IT/ITES Under weight the world. While US and European customers of Indian IT companies are in good health, Order inflows might slow down in near term We like the growth prospects of power sector but believe that value will be created by engineeringPower Utilities Under weight services providers. Merchant power rates have been sliding downwards and coal prices have been on the way up putting pressure on return ratios.
  11. 11. Debt Outlook 9.1 Yield curve 9.30 10-yr G-sec yield 9.0 8.80 8.9 8.8 8.30 8.7 7.80 8.6 8.5(%) 7.30 8.4 8.3 6.80 7.1 0.0 0.9 1.8 2.7 3.5 4.4 5.3 6.2 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 increased by 44 bps in October to close at 8.88%. This was after an increase of 25 bps in the interest rates by RBI. • The medium term papers rallied the most in the month and rose 52 bps to close at 8.83%. While the G-sec yields increased, the 10 year AAA corporate paper yields remained constant at 9.84%. • 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. 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 believe that it may Debt 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 -2000 5.00% 80 Export Import Trade Balance (mn $) -4000 4.00% 60 -6000 3.00% 40 -8000 -10000 20 2.00% -12000 0 -14000 1.00% -20 -16000 0.00% -1.00% USD GBP EURO YEN • India’s merchandise exports grew 36.4 per cent in September, -2.00% reaching $24.8 billion from $18.2 bn a year before. However, -3.00% this is a much lower rise than the previous two months. In July, -4.00% exports grew 81.8 per cent; in August, these rose 44.2 per cent -5.00% 140000 Capital Account Balance• INR appreciated by about 1% during the month. Also, 90000 during the month it did witness a low of 50.07, but recovered after some stability was sensed in the 40000 International markets. It closed at 48.87 at the end of the month. -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 Eurozone currencies strengthened in the month as a • Capital account balance was positive throughout FY11 and decision was taken to write of 50% of the debts and to stood at `273133 Cr. at the end of the year. For FY 12, the capital account is at `93,621Cr. for Q1. strengthen the EFSF bringing some sense of containment • We expect factors as higher interest rates to attract more of the Eurozone crisis. investments to India. Increased limits for investment by 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 30000 The problems in the Euro Zone is far from over as concerns Gold 28000 were raised on the implementation of proposed Greece 26000 bailout package. Further, concerns were raised on Chinese 24000Precious Shadow lending and possible slowing or the hard landing in 22000 China. The fundamental factors largely remained Metals unchanged and Indian market has seen fresh buying 20000 18000 demand during the festive Diwali Season despite prices staying higher. Expect gold prices to remain firm as any correction shall be supported by physical purchases. Crude The recent bout of global uncertainty have pressurized 130.0 120.0 crude oil amid concern of double dip recession in the US 110.0 and global economy slipping into red. We expect crude oil 100.0Oil & Gas prices have topped out in the interim and can only move 90.0 80.0 down from here on. We have seen some firmness in the 70.0 prices post the announcement of Greece bailout package, 60.0 31-May-2011 30-Sep-2010 31-Jan-2011 28-Feb-2011 31-Mar-2011 30-Jun-2011 30-Aug-2010 31-Dec-2010 30-Apr-2011 31-Aug-2011 31-Oct-2010 30-Nov-2010 31-Jul-2011 nevertheless, any such temporary uptick shall not be sustained. Expect crude oil prices to be steady. 14
  15. 15. Product in FocusOrion 4 Objective: – To generate superior fixed income payoff (return) while preserving the capital. – To generate appreciation even if the reference index is at (or above) 105% of its initial level. Payoff Scenario: – If final level is greater than or equal to strike level, then the structure pays an absolute coupon of 21% (annualized return of 13.56%). – In case, if the final level is below the strike level, no coupon is paid out, but structure remains capital protected. Nifty Digital Growth Product Specifications Payoff At Maturity Reference Index S&P CNX Nifty Index If Final Level >= Strike Level Principal * (1 + Coupon) Tenor 15 / 18 Months If Final Level < Strike Level Principal * (1 + 0%) Coupon 21% Strike Level 105% of Initial Level Initial Level Reference Index as on Trade Date (1/3)* Σ Reference Index(i); where Final Level i=13M to 15M 15
  16. 16. Product in FocusPi - Multi Asset Quant Portfolio• Pi is a multi-asset quantitative portfolio investing in Nifty, Gold, Crude oil and USDINR through liquid futures contracts in NSE and MCX and other major exchanges• Pi is managed using a well defined quantitative strategy with no human intervention in the execution of the strategy• Pi is aimed at generating positive and consistent absolute returns through investing into assets with low correlations• Investment horizon for investing in Pi is 24 months and above Nifty Crude Oil Gold USD Pi Average annual rolling returns 14% 19% 25% 2% 38% Worst annual rolling returns -58% -54% 5% -13% 9% Worst calendar quarterreturns -23% -61% -8% -2% -2%• The average annual rolling returns of Pi are higher than its constituents –driven largely by the dynamic quantitative approach• While most asset classes have significantly large negative annual rolling returns; Pi has minimum annual rolling return of 9% (positive)• The worst calendar quarter for most Nifty and crude oil have been as low as -23% and -61% respectively. For Pi the worst quarter has been -2% 16
  17. 17. 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. 17
  18. 18. 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 18
  19. 19. 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. 19
  20. 20. 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” 20
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