Comparative analysis of ICICI Prudential US bluechip Equity Fund

1. COMPARATIVE ANALYSIS
OF PERFORMANCE OF
ICICI PRUDENTIAL US
BLUECHIP EQUITY FUNDS
3 Years Presented by:
Saksham Kukreja
MBA-II Year
(Finance)

2. Industry Profile
• FINANCIAL SERVICE
India has a very big and diversified financial sector and there is huge number of
companies trying to enter in Indian market ICICI Prudential, etc. is one of them.
Financial service sector compromises of commercial banks, Non-banking Financial
Institute, Insurance companies, Mutual fund & Brokerage Firm, wealth
management, Private Equity, Investment Banking firms, Venture capital etc.
The major players in the Mutual Funds Sector Are:
• AXIS
• Aditya Birla Sun Life
• ICICI Prudential
• CANARA ROBECO
• DHFL
• EDELWEISS
• HDFC
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3. Company Profile
• ICICI PRUDENTIAL
The AMC is a collaboration between 2 organizations i.e. ICICI
Bank, a well-known and repudiated private bank in the private
banking industry of India and Prudential Plc, also one of the largest
financial service provider i.e. Insurance.
The organization oversees huge Assets under Management (AUM)
in the mutual asset section. The AMC likewise obliges Portfolio
Management Services for their investors; spread all over the
country, the company also provide International Advisory
Mandates for customers across global business sectors for sections
such as Debt, Equity and Real Estate.
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4. Introduction to the Topic
• Introduction:
A mutual fund is an financial instrument that uses the
concept of larger population as they utilize the pool of
resources generally cash that are then further invested into
the securities by the fund managers and the Asset
management company for a small portion of the returns thus
the name mutual funds as both the parties i.e investor and
the AMC gets benefitted under this type of financial
instrument theoretically nut the risks of the financial market
remains same but the expected returns exceed the risk free
rate to make the scheme attractive
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5. Need for the Study
• The requirement for assessing the performance of Mutual
Fund plans to see what their performance has been in
comparison to the benchmark to determine if they have
been under or over performing and to see the competency
of scheme’s to make out a lucrative financial instrument of
investment.
• The main motivation behind this topic was to assess the
performance of the said mutual fund so as to enhance the
investment opportunity for the investors and identify a
different potential investment tool to advise others as well.
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6. Review of Literature (if any)
Author (Year) Key-Findings
Bahl, Rani (2012) Mutual funds that had failed were due to lack of diversification in their portfolio
Debasish (2009)
The examination uncovered that Franklin Templeton and UTI were the best
performers and Birla Sun life, HDFC and LIC shared assets showed lackluster
showing.
Ali, Naseem and
Rehman (2010)
Assets of Pakistan had the option to add more worth either ordinary or Islamic
Garg (2011)
Reliance Regular Saving Scheme Fund had received the most evident last score and
Canara Robeco Infra
Sondhi and Jain (2010)
They concluded that high beta assets (market chances) may not earn exceptional
returns
Ahmed, Baig (2015)
They concluded that the open ended scheme performed better than as compared
to close ended scheme.
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7. Project Profile (Research Design)
• Comparative Analysis Of Performance Of ICICI Prudential US
Bluechip Equity Funds
• Objectives:
1. To examine the performance of the ICICI Prudential US Bluechip
Direct Growth for last 3 years on the basis of risk and return.
Comparing the performance of the ICICI Prudential US Bluechip
Direct Growth for the last 3 years with benchmarks index to see
whether the scheme is performing better or worse than the
benchmarks.
2. To assess and measure the performance of the ICICI Prudential
US Bluechip Direct Growth by using the Sharpe, Treynor and
Jensen Alpha that are there to measure performance of the funds
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8. Project Profile (Sample Design)
• Type of Study: Empirical study
• Sampling Procedure : Judgment Sampling
• Sample Size: Scheme =1, Benchmark=2
• Data collection Technique: Secondary data from various
databanks and websites
• Limitations:
• The quality of management and the fund manager is not taken into
consideration which has quite relevant influence over the schemes
performance.
• The data and analysis has been done for last 3 years only and the
results cannot be fully suited for accurate predictions and reasoning.
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9. Respondents / Data Profile
• The data for Comparative Analysis Of Performance Of
ICICI Prudential US Bluechip Equity Funds was taken
from online websites such as investing.com etc. for
their NAV value data and their portfolio etc. Then
software such as MS-Excel/R-Studio were used to
convert the raw data to useful information for the
required ratios then these required ratios for each
indices for each year was represented by graphs to get
better idea.
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10. Data Analysis
•Treynor Ratio:
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The last 3 years data of the ICICI prudential
US bluechip equity funds have performed
well for the years 2018 and 2019 implying the
better performance than the indexes during
the normal circumstances however during the
last year 2020 the year of Covid-19 the
scheme has pulled less than one index. The
better TREYNOR ratio than the indices
implies that the management and the scheme
is going well as per their plan and has
performed well in the certain times however
they shifted to the safer side when the
circumstances changed to uncertain during
2020.
-0.029
0.283
0.178
-0.149
0.155
-0.007
-0.097
0.251
0.399
-0.200
-0.100
0.000
0.100
0.200
0.300
0.400
0.500
2018 2019 2020
Treynor ratio
ICICI PRU US BLUECHIP DOWJONES NASDAQ

11. Data Analysis
•Jensen Alpha
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-19
50.14
24.72
-29.75
37.37
7.63
-24.13
48.37 47.5
-40
-30
-20
-10
0
10
20
30
40
50
60
2018 2019 2020
JENSEN ALPHA
ICICI PRU US BLUECHIP DOWJONES NASDAQ
The last 3 years data of the ICICI prudential US
bluechip equity funds have performed well for the
years 2018 and 2019 because it had the highest
alpha till 2019 implying the better performance
than the indexes during the normal circumstances
however during the last year 2020 the year of
Covid-19 the scheme has pulled less than one. The
higher ALPHA indicates better performance on the
scheme and their managements part however they
were not quite capable to cope up with the
uncertainty in the market and thus the half better
performance.

12. Data Analysis
•Sharpe Ratio
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-0.17
3.37
0.61
-3.82
3.87
-0.08
-2.0
4.1
1.8
-5.00
-4.00
-3.00
-2.00
-1.00
0.00
1.00
2.00
3.00
4.00
5.00
2018 2019 2020
SHARPE RATIO
ICICI PRU US BLUECHIP DOW JONES NASDAQ
The last 3 years data of the ICICI prudential US
bluechip equity funds have performed well in the
years 2018 witnessed by higher SHARPE ratio but
lower for 2019 and half good for the year 2020
implying the better performance than the indexes
during the normal circumstances however during
the last year 2020 the year of Covid-19 the scheme
has pulled worse than NASDAQ but better than the
DOW JONES implying their focus was on being at
safe side. The higher SHARPE ratio than the indices
implies that the management and the scheme is
going well as per their plan and has performed well
in the certain times however they shifted to the
safer side when the circumstances changed to
uncertain during 2020.

13. Observations
• The mutual fund scheme has performed well in the times of certainty that has been
evident by the higher ratios and the better continuous performance of the scheme.
This better performance in the times of certainty is a very good thing implying the
future of the scheme is good as the scheme will definitely outperform the index in
certainty that is most probable times in the market.
• The management and fund managers have a proactive and a secure nature in their
style of management and their portfolio as they were able to pull a better return but
not better than the NASDAQ index as the market displayed a very volatile nature in
the year 2020.
• The times where the index displayed negative returns the scheme has displayed
positive returns and ratios even then this was evident in the year 2018 thus
displaying their capabilities and their strength in both their management and their
fund management.
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14. Conclusion
The ICICI Prudential US bluechip Equity fund has displayed
that it has outperformed the market index mostly when the
circumstances were certain and the scheme has pulled
better returns even in the year when the market was down
the scheme performed positively and thus making its
presence known however the scheme switched to the
defensive mode when the things in the market became
uncertain due to the pandemic outbreak of Covid-19 virus.
No matter what the circumstances are the fund has strength
to perform if not outperform the market index.
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15. Recommendations
The scheme can be recommended to those who are looking
for the long term investment and are willing to take risk of
foreign currency risk and they are willing to go out of the
country for the investment opportunity. The fund has a very
diversified and capable portfolio that allows them to
perform. The scheme is unique in many ways as not a lot of
option is there for those folks who want to invest in foreign
country but also wants the benefit of the mutual funds.
Investor should always be aware and up to date of the
certain circumstances in the market and their effects
because the market can be extremely unpredictable.
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16. Bibliography(in APA Format)
BOOKS
• Micheal.M.Pompeian, Behavioural Finance and Wealth Management: How to
Build Investment Strategies That Account for Investor Biases 2nd edition ( Wiley
finance, 2011)
• I.M.Pandey, Financial management 10th edition (Noida, Vikas publications,
2013)
RESEACH JOURNALS
• Ali, Rizwan., Naseem, Muhammad Akram and Rehman, Ramiz Ur (2010).
Performance Evaluation of Mutual Funds. Social Science Research Network
online Publication 10 May, Available at SSRN:
http://ssrn.com/abstract=1837103
• Debasish, Sathya Swaroop (2009). Investigating Performance of Equity-based
Mutual Fund Schemes in Indian Scenario. KCA Journal of Business
Management, 2(2), 1-15.
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17. Bibliography
• Garg, Sanjay (2011). A Study on Performance Evaluation of Selected Indian Mutual Funds.
International Journal of Innovation Creativity and Management (IJICM), 1(1), 1-10
• Prabakaran, G and Jayabal, G (2010). Performance Evaluation of Mutual Fund Schemes in India:
An Empirical Study. Finance India, 24 (4), 1347-1363.
• Sondhi, H.J and Jain, P.K (2010). Market Risk and Investment Performance of Equity Mutual
Funds in India: Some Empirical Evidence. Finance India, XXIV (2), 443-464.
• Jayadev, M (1996). Mutual Fund Performance: An Analysis of Monthly Returns. Finance India, 10
(1), 73-84.
• Shanmugham, R and Zabiulla (2011). Stock Selection Strategies of Equity Mutual Fund Schemes
in India. Middle Eastern Finance and Economics, ISSN 1450-2889, Issue 11, 19-28.
• Dr. Sarita bahl and Meenakshi rani (2012) Comparative Analysis Of Mutual Fund Schemes In
India International Journal of Marketing, Financial Services & Management Research Vol.1 Issue
7, July 2012, ISSN 2277 3622.
• Waqas Ahmed and Sajjad Baig (2015) A Comparative Study on Performance of Open and Close-
ended Mutual Funds in Pakistan, International Journal of Accounting and Financial Reporting .
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18. Bibliography
WEBSITES:
Money Control www.moneycontrol.com
Mutual fund India: www.mutualfundindia.com
www.amfiindia.com
ICICI Prudential Us Bluechip:
https://www.icicipruamc.com/mutual-fund/equity-
funds/icici-prudential-us-bluechip-equity-fund
Investing: in.investing.com
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