The document provides market performance data for various global and domestic equity indices for June 2020. It also provides an update on the Indian market and economy. Some key points: - US, UK, Japan, Hong Kong, and other global equity markets posted positive returns in June 2020, with the US market returning 1.7%. - Indian equity benchmarks Sensex and Nifty 50 gained around 7.5-7.7% in June. Various domestic sectors like banking, autos, and realty saw gains ranging from 7-12%. - The Indian economy is expected to contract in the current fiscal year due to the impact of COVID-19. However, high frequency indicators show signs of recovery as lockdowns

1. July 2020
Global Markets June-20
(%)
Current
PE
10 Yr
Average
US 1.7 19.2 15.7
UK 1.5 22.2 17.6
Japan 1.9 26.0 19.8
Hong Kong 6.4 10.7 10.8
Singapore 3.2 10.4 12.1
China 2.1 8.1 8.4
Domestic Markets June - 20
(%)
Current
PE
10 Yr
Average
S&P BSE Sensex 7.7 22.5 20.0
NSE Nifty 7.5 26.3 20.3
S&P BSE Auto 8.4 62.7 19.4
S&P BSE Bankex 9.7 19.6 17.6
S&P BSE Capital Goods 4.3 24.0 28.6
S&P BSE Consumer
Durables 7.2 36.5 31.4
S&P BSE FMCG 3.3 32.7 39.3
S&P BSE Healthcare 3.9 38.2 28.6
S&P BSE IT 5.8 18.5 19.5
S&P BSE Metals 5.9 13.6 12.0
S&P BSE Mid Cap 10.2 25.4 23.9
S&P BSE Oil & Gas 7.0 14.7 12.1
S&P BSE PSU 8.5 10.2 13.1
S&P BSE Realty 12.0 53.2 24.2
US Economy: US‟ real GDP slipped 5% on-year in the first quarter of 2020. Also,
unemployment is seen falling to 9.3% by the end of this year and 6.5% by the end of
2021. Because of the dire projection, the US Fed vowed to keep benchmark rates
unchanged at near zero over the next two years, while continuing its bond-buying
programme, at least at its current pace, to support credit markets.
Eurozone: The euro zone economy is likely to contract 10.2% in 2020, followed by a
rebound of 6% in 2021. Meanwhile, the European Central Bank (ECB) has provided 1.31
trillion euros ($1.46 trillion) in long term, ultra-cheap credit to banks as part of its
emergency support aimed at cushioning the impact of the pandemic on businesses and
workers.
UK: According to the IMF, the pandemic will hit UK‟s economy much harder than much
of the rest of the world, with the country‟s GDP projected to spiral 10.2% this year. To
addressee the woes cause by Covid-19, the Bank of England‟s (BoE) policy panel voted
8-1 to increase its quantitative easing programme by 100 billion pounds ($125 billion),
while holding the benchmark interest rate at a record-low 0.1%.
Japan: The Bank of Japan (BoJ) voted 8-1 to retain the interest rate at -0.1% on current
accounts that financial institutions maintain at the central bank. The BoJ governor
warned of protracted battle with pandemic, and also signalled the bank‟s readiness to top
up monetary support. Meanwhile, the country‟s GDP was revised down to 2.2%
contraction on-year in the first quarter of 2020.
China: China has abandoned setting a target for GDP growth for the first time in decades,
citing „great uncertainty‟ caused by the pandemic. The People's Bank of China injected
120 billion yuan ($16.80 billion) via seven-day reverse repos at 2.20% on May 27, 2020.
Index Performance: Indian equity indices recorded impressive performances
in June 2020, buoyed by upbeat domestic and global cues. The benchmarks
S&P BSE Sensex and Nifty 50 index had surged ~8% in June 2020.
Inflation: Retail inflation, based on Consumer Price Index (CPI), for May 2020,
was not released by the National Statistical Office owing to the lockdown
restrictions announced by the government to prevent the spread of Covid-19.
Consumer food inflation, though, rose 9.28% on-year in May.
Domestic Developments:
Headwinds:
Concerns about the relentless spike in the new Covid-19 cases back home and
a second wave of the pandemic globally. Escalating geopolitical tensions
between India and China, profit-booking post the rally, and selling by domestic
institutional investors kept the market under pressure as well.
Tailwinds:
Market rose sharply owing to optimism following the gradual reopening of the
domestic economy, and after the Drugs Controller General of India approved
the manufacture of Covid-19 drugs. De-escalation of geopolitical tensions,
gains in index heavyweights, and buying of domestic equities by foreign
institutional investors also augured well for the indices.
EQUITY UPDATE
Data Source: Crisil Research; * Data till June 30, 2020;
Data Source: Crisil Research; * Data till June 30, 2020, PE- Price to Earnings; IMF –
International Monetary Fund
Indian Market Update
Global Market Update

2. Indian Market Update
Earnings Growth (%) FY19 FY20E FY21E
Sensex 14.6 (0.6) 31.1
Macro Indicators Latest
Update
Previous
Update
GDP (YoY%) 3.1%
(4QFY20)
4.7%
(3QFY20)
IIP (YoY%) -55.5% (May) -18.3% (Apr)
Crude ($ bbl) 41.15 (June 31) 35.33 (May 31)
Core Sector Growth
(YoY%)
-23.4%
(May 2020)
-37%
(April 2020)
Trade Deficit ($ mn) -3,150
(Apr 2020)
-6,760
(Mar 2020)
Current Account Deficit
($ bn)
0.6
(4QFY20)
-2.6
(3QFY20)
FII Holding in Indian
Equities (%)#
21.5
(4QFY20)
22.2
(3QFY20)
Flows June - 20 May - 20 Apr - 20
FIIs (Net Purchases /
Sales) (Rs cr)
21,832 14,569 -6,884
MFs (Net Purchases /
Sales) (Rs cr)
(3,690) 5,109 -6,846
Note: # FII hldg includes ADR/GDR (BSE500 Index); Data Source: Crisil Research; * Data till June 30, 2020; CAD: Current Account Deficit; GDP: Gross Domestic Product, IIP: India Industrial
Production FII: Foreign Institutional Investors; MF-Mutual Fund; E- Estimate
Outlook & Triggers
Global equities rejoiced the re-opening of economies which was well reflected in positive returns posted by most of the
countries in the month of June. Indian Equity Markets (Nifty 50 Index) too joined the bandwagon and delivered 7.7% returns.
However, global and domestic markets remain watchful of the second wave of COVID-19 led infections.
Several economic data releases from the US among other factors buoyed global market sentiments. As per data released, US
private payrolls rose by 2.37Mn in June while a gauge of manufacturing activity rebounded to its highest levels in 14
months. The US also confirmed that the phase 1 trade deal signed with China was still in effect. Liquidity support is likely to
remain intact as Fed meeting minutes state that the monetary policy stance will continue to remain highly accommodative.
(source: CRISIL)
Despite an increase in COVID-19 cases, Indian equities delivered positive returns. S&P Global affirmed India‟s rating at BBB-
/A3 and maintained a stable outlook. Strong fundamentals like healthy forex reserves (USD 505.6 bn as of June 19), stellar
currency, current account surplus, etc. help attract foreign investments. India also stands to benefit from the potential shift in
base of companies from China resulting from the ongoing US-China and India-China tensions as India too has a demographic
advantage. . (source: CRISIL)
High Frequency data points indicate improvement in mobility trends and essential services like groceries and pharmacies are
now close to pre-lockdown levels. The May Composite PMI too improved marginally from April. Current Account Balance
turned into surplus in Q4 FY20. May trade deficit numbers too declined significantly.
Sectors like Energy and Finance outperformed while Telecom and FMCG underperformed. (Source: NSE)
*The sector(s)/stock(s) mentioned in this communication do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s). PMI – Purchasing Manager‟s Index
Global Developments:
Headwinds: Selling exacerbated after the US Fed projected the US economy
to contract 6.5% this year, and pegged the unemployment rate at 9.3%.
Persistent worries about the global economic recovery and downbeat growth
projections by the IMF, the OECD and the World Bank also impacted the local
indices.
Tailwinds: Upbeat global cues, including the US Fed‟s corporate bond buying
programme, US President Donald Trump‟s decision to keep the trade deal with
China intact, encouraging US monthly jobs and Chinese economic data, and
hopes of additional stimulus measures by various countries, also supported
the local indices.
Sectoral Impact:
Nevertheless, all S&P BSE sectoral indices ended in the green in June. The
S&P BSE Realty (top sectoral gainer), S&P Finance, and S&P Bankex indices
jumped 12.04%, 11.92% and 10.23%, respectively. Buying interest was seen
in the auto and consumer durable stocks; S&P BSE Auto and S&P BSE
consumer durable indices climbed 8.38% and 7.23%. S&P Fast moving
consumer goods, and S&P BSE Healthcare indices saw marginal gains of
3.31% and 3.94%, respectively.

3. Equity valuation index is calculated by assigning equal weights to Price to Earnings (PE), Price to book (PB), G-Sec*PE and Market Cap to Gross
Domestic Product (GDP)
Our Recommendation
Our Recommendations – Equity Schemes
Pure Equity
Schemes
ICICI Prudential Bluechip Fund
ICICI Prudential Multicap Fund
These Schemes aim to generate capital appreciation through
participation in equities.
Long-Term SIP
Schemes
ICICI Prudential Value Discovery Fund
ICICI Prudential Smallcap Fund
ICICI Prudential Midcap Fund
ICICI Prudential Large & Mid Cap Fund
ICICI Prudential India Opportunities Fund
These schemes aim to generate long term wealth creation over a full
market cycle.
Asset
Allocation
Schemes
ICICI Prudential Balanced Advantage Fund
ICICI Prudential Equity & Debt Fund
ICICI Prudential Multi-Asset Fund
ICICI Prudential Equity Savings Fund
ICICI Prudential Regular Savings Fund
ICICI Prudential Asset Allocator Fund (FOF)
These schemes aim to benefit from volatility and can be suitable for
investors aiming to participate in equities with low volatility.
None of the aforesaid recommendations are based on any assumptions. These are purely for reference and the investors are requested to consult their financial advisors.
Our „VCTS‟ framework is currently indicating that, Valuations - are reasonable for long term investments, Cycle – Business Cycle has
bottomed out, Trigger would be the trajectory of COVID-19 growth curve and vaccine development and Sentiments – around equity as
an asset class is negative due to muted past returns and relatively low FPI flows. We recommend that it is a good time to accumulate
equities and stay invested for long term across market cycles.
We believe that the divergence between Value and Growth stocks continues to prevail. Currently, fundamentally sound value stocks are
available at inexpensive valuations, providing good dividend yield and have better earnings visibility. Hence, we recommend investors
to take exposure to schemes with Value bias – ICICI Prudential Value Discovery Fund and Special Situation theme – ICICI Prudential
India Opportunities Fund. Small, midcaps and value oriented stocks over the next few years is recommended for lumpsum investment
for patient long term investors.
We also believe that volatility is expected to prevail for some time as the world comes to terms with the evolving COVID-19 situation
and its economic fallout. As an investor, one must embrace volatility and be cognizant of his/her own asset allocation while investing.
We continue to recommend Dynamic Asset Allocation schemes which aim to benefit from volatility by reducing the overall cyclicality
of the portfolio.
Equity Valuation Index

4. ICICI Prudential Bluechip Fund is suitable for investors who are seeking*(An open ended equity scheme predominantly
investing in large cap stocks):
 Long term wealth creation
 An open ended equity scheme predominantly investing in large cap stocks.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Large & Mid Cap Fund is suitable for investors who are seeking**(An open ended equity scheme investing
in both large cap and mid cap stocks):
 Long term wealth creation
 An open ended equity scheme investing in both large cap and mid cap stocks
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Value Discovery Fund is suitable for investors who are seeking*( An open ended equity scheme following a
value investment strategy):
 Long term wealth creation
 An open ended equity scheme following a value investment strategy.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Equity & Debt Fund is suitable for investors who are seeking*(An open ended hybrid scheme investing
predominantly in equity and equity related instruments):
 Long term wealth creation solution
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fixed income securities.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Balanced Advantage Fund is suitable for investors who are seeking*(An open ended dynamic asset
allocation fund):
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 An equity fund that aims for growth by investing in equity and derivatives.
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ICICI Prudential Multicap Fund is suitable for investors who are seeking*(An open ended equity scheme investing across
large cap, mid cap, small cap stocks):
 Long term wealth creation
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ICICI Prudential Equity Savings Fund is suitable for investors who are seeking*(An open ended scheme investing in equity,
arbitrage and debt):
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 An Open ended scheme that seeks to generate regular income through investments in fixed income securities,
arbitrage and other derivative strategies and aim for long term capital appreciation by investing in equity and
equity related instruments.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Multi-Asset Fund is suitable for investors who are seeking*(An open ended scheme investing in Equity,
Debt and Exchange Traded Commodity Derivatives/ Units of Gold ETFs/units of REITs & InvITs/Preference Shares):
• Long term wealth creation
• An open ended scheme investing across asset classes.
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ICICI Prudential Regular Savings Fund is suitable for investors who are seeking*(An open ended hybrid scheme investing
predominantly in debt instruments):
 Medium to Long term regular income solution
 A hybrid fund that aims to generate regular income through investments primarily in debt and money market
instruments and long term capital appreciation by investing a portion in equity.
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ICICI Prudential Midcap Fund is suitable for investors who are seeking*(An open ended equity scheme predominantly
investing in mid cap stocks):
 Long term wealth creation
 An open-ended equity scheme that aims for capital appreciation by investing in diversified mid cap companies.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Smallcap Fund is suitable for investors who are seeking*(An open ended equity scheme predominantly
investing in small cap stocks):
 Long term wealth creation
 An open ended equity scheme that seeks to generate capital appreciation by predominantly investing in equity
and equity related securities of small cap companies.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential Asset Allocator Fund (FOF) is suitable for investors who are seeking*(An open ended fund of funds scheme
investing in equity oriented schemes, debt oriented schemes and gold ETFs/schemes) *Investors may please note that they will be
bearing the recurring expenses of this Scheme in addition to the expenses of the underlying Schemes in which this Scheme makes investment.:
 Long Term Wealth Creation
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ETFs/ schemes.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
ICICI Prudential India Opportunities Fund is suitable for investors who are seeking*(An open ended equity scheme following
special situations theme):
 Long Term Wealth Creation
 An equity scheme that invests in stocks based on special situations theme.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.
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