equity market outlook - life insurance policy in india... · fy11. the third quarter gdp growth was...

Key Indices 29-Feb-12 31-Jan-12 % Change

Nifty 5385.20 5199.25 3.58%

Sensex 17752.68 17193.55 3.25%

BSE 100 9321.49 8970.08 3.92%

Dow Jones 12952.07 12632.91 2.53%

Nikkei 9723.24 8802.51 10.46%

Hang Seng 21680.08 20390.49 6.32%

Nasdaq 2966.89 2813.84 5.44%

KOSPI 2030.25 1955.79 3.81%

Equity Market Outlook

February saw continued buying interest from FIIs as the global and domestic macro-economic situation improved. Improving globalsentiments has led to large FII inflows. In the current calendar year, FIIs have bought US$7.2bn worth of Indian equities whiledomestic institutions have sold US$3.7 bn of Indian equities. The European crisis appear to have been averted for now as theECB, through its 2nd long-term refinancing operation (LTRO), allotted another €529 bn of 3-year funds to 800 banks. Together withthe first auction, the ECB has now injected €1 tn of 3-year funds into the system. This is an extremely high amount which can takecare of total European bank bond maturities in 2012 and 2013. European banks are now effectively pre-funded through to 2014and largely insulated from shocks in the funding market. However, we expect economic contraction in Europe to continue despiteLTRO on account of the severe austerity measures across Europe. Sentiment in the US has turned bullish, driven by a pickup incorporate and industrial loans and the resultant capex growth. Equity markets across the globe have rallied and this rally is not justliquidity driven. This rally is also partly due to fact that global earnings have bottomed, PMI’s have improved and there has been anupturn in the OECD leading indicators.

4000

4500

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22000De

c-10

Jan-

11

Mar

-11

Apr-1

1

May

-11

Jun-

11

Jul-1

1

Aug-

11

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Nov-

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Dec-

11

Jan-

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Feb-

12

Sensex Nifty

(500)

500

1500

2500

In U

S $

MN

FII MF

47.00

48.00

49.00

50.00

51.00

52.00

53.00

54.00Rs v/s USD

The month of March has several key events like election results, the Reserve Bank of India (RBI)’s policy review and the UnionBudget. In addition there will be liquidity pressure on account of the advance tax payment. The Budget FY2012-13 will be a keyevent for the markets and there are expectation that a credible roadmap for fiscal consolidation will be laid out and some definitivesteps to boost the investment cycle will be taken. FDI in multi-brand retail, pension and insurance reforms will also boost equitymarket sentiment. We believe that the Sensex, after posting a strong rally, is currently in a consolidation phase and is still tradingattractively at 13.5xFY13e earnings. We believe that the equity market would resume its uptrend in the coming months asvaluations continue to be attractive.

On the domestic front, GDP growth slowed to 6.1%YoY in 3QFY12 following the 7.7% and 6.9% growth in 1Q and 2QFY12respectively. Weak growth was because industrial growth slowed to 2.6%YoY, led by a deceleration in manufacturing and acontraction in mining growth. Growth in the services sector held up at 8.9%YoY and agricultural growth remained lackluster at2.7%YoY. The 9 month growth in 2012 has dropped to 6.9% as against 8.1% last year. This deceleration in growth supports theview of monetary easing to the extent of 75-100bps by RBI through FY12-13. Oil prices could however be a spoiler. The sharp run-up of 17% to $125 per barrel, in crude oil prices since January this year, has brought the fears of its damaging impact on inflationand economic growth globally. The RBI could delay its rate cuts keeping in view the inflationary pressure that could result fromrising crude prices. On the policy front, some key proposals including (a) fast track clearances for power and coal projects; (b)allowing expansion in coal production of existing mines without fresh clearance; (c) instructing Coal India to sign Fuel SupplyAgreements with power plants that have implemented PPAs, are positive. Any acceleration of the reform process could result in theinvestment cycle recovering in the latter half of the year.

(2500)

(1500)

(500)

Feb

11

Mar

11

Apr

11

May

11

June

11

July

11

Aug

11

Sep

t 11

Oct

11

Nov

11

Dec

11

Jan

12

Feb

12

In U

S $

MN

42.00

43.00

44.00

45.00

46.00

47.00

Dec

-10

Jan-

11

Mar

-11

Apr

-11

May

-11

Jun-

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1

Aug-

11

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Oct

-11

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Dec

-11

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Feb-

12

Key Indices 29-Feb-12 31-Jan-12 % Change

10 year G-Sec 8.20% 8.28% -0.93%

5 Year G-Sec 8.33% 8.29% 0.52%

91 Day T Bill 9.02% 8.75% 3.09%

364 day T-Bill 8.45% 8.48% -0.35%

MIBOR 9.97% 9.68% 3.00%

Call Rates 8.97% 9.14% -1.86%

Inflation 6.55% 7.47% -12.32%

Despite the release of about Rs 30,000 crores on account of the CRR cut, liquidity in the system is still tight and has been, on an average,negative to the extent of Rs 1 lakh crores. RBI is comfortable with the LAF of 1% of NDTL, i.e. about Rs 60,000 crores, and hence is likelycontinue with OMOs (Open Market Operations) or cut CRR once again in March 2012 to infuse liquidity.

On the fiscal front, the FY12 fiscal deficit is expected to be in the range of 5.6% - 5.8% of GDP, as against budget estimates of 4.6%.Lower tax revenues, lower divestment proceeds and higher subsidies largely on account of fuel have led to this high fiscal deficit.

Debt Market Outlook

The global economic situation continues to be challenging. Global economic growth in 2012 will slow down. Europe is slipping into arecession and this will affect the rest of the world. The US economy is struggling to come to terms with high unemployment, surging oilprices and an accommodative monetary policy. In emerging economies, inflation expectations remain sticky. China and India remainislands of the high growth but even they are showing signs of slowing down. Oil prices remain high because of the strained situation inMiddle East and this will impact the world economy adversely.

Domestic growth has decelerated and the advance estimates for FY12 GDP has been revised down to 6.9% as compared to 8.4% inFY11. The third quarter GDP growth was 6.1%. WPI inflation has eased from 9% to 6.6%, with ‘non-food manufactured product inflation’(which is the RBI’s proxy for core inflation) dropping to 6.7%.

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75

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125

150

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Dec

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Jan-

11

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-11

Apr-1

1

May

-11

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Jul-1

1

Aug-

11

Sep-

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Oct

-11

Nov

-11

Dec

-11

Jan-

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Feb-

12

10 Yr G-Sec yield 5 year AAA Corporate Bond Spread

bps

perc

enta

ge (%

)

With the state elections now behind us, the government is expected to be more proactive on the policy reforms front. The FY13 Budgetwill be closely watched for steps towards fiscal consolidation, among other important things. The bond markets are also concerned aboutthe current account deficit, falling headline GDP growth and high trade deficit.

We expect the 10 year G-Sec to be range bound at levels of ~8.15%. The spread on corporate bonds are expected to remain at around90bps.

Growth concerns have now begun to outweigh inflation concerns. Headline inflation is expected to be below 7% Y-o-Y by March 2012 andthe monetary stance of the RBI could turn more accommodative. We expect policy rate cuts from April 2012.

Learning Curve

Understanding Asset Allocation

Asset Allocation can be defined as a process of selecting assets that will generate adequate returns

to meet the financial goals at the desired level of risk.

The key objective is to increase the return on the invested amount while lowering investment risk to

meet the financial goals. A chosen portfolio should have a judicious mix of asset classes such as

equity, bonds, fixed deposits, gold etc; that have different degree of risks & returns associated with

them. Investing in equity has the potential to deliver higher return but comprises of higher risk too

where as investing in debt may not give very high returns and the risk taken too, is not as high. It is

important to assess these asset classes before investing in them.

There is no asset allocation which is designed and will universally benefit each and every individual. It

has to be customised to suit one’s profile, considering his financial goal, the amount he is willing to

invest, as well as the risk he is willing to take. It is one of the most critical elements of successful

investing and needs to be utilised consciously while investing.

5 easy steps to simplify asset allocation decision

Step 1: Determine your Investment Objective:

Decide the purpose for which you are investing. Investment objective of one person may vary from

that of another. For instance, the objective of a person nearing his retirement would be to ensure a

regular pension and capital preservation, while that of a young professional will be to buy a house.

Step 2: Determine your Risk Appetite:

Few factors that impact risk appetite are life stage, net worth, income and past investment

experience. An individual who is young has more capacity to take risks and can invest a higher sum in

assets with higher risks. He will follow an aggressive investment strategy. Risk appetite of someone

who has suffered huge losses in the market will be very low.

Step 3: Determine the Time Horizon of your investment:

It is the period of time for which an individual will retain his investment. The investment period broadly

depends upon two parameters, namely, the objective of the investment and the financial resources

available at an individual’s disposal. E.g. if the investment objective is to accumulate for your 10 year

old child’s wedding, then one can invest in assets with higher risk to generate higher returns.

Individuals nearing the age of retirement will take less risk as their period for investing is much

shorter. Furthermore, someone who has a reserve sum to take care of any unforeseen event will have

a longer investment period as compared to someone who relies on his current income to fulfil all his

needs.

Step 4: Select a Diversified Portfolio:

On the basis of your predetermined goal, risk tolerance and period of investment select a diversified

portfolio which includes various asset classes namely equity, bond & money market instruments. E.g.

if one’s objective is to meet near term obligations, then he may be better off by investing in money

market instruments. An aggressive investor with high risk appetite or long-term horizon may have his

portfolio skewed heavily towards equities. On the contrary, a conservative investor with low risk

appetite or short-term time horizon may have his portfolio skewed towards bonds.

Step 5: Rebalancing your Asset Allocation:

One should not frequently change the asset allocation based on market conditions. It is wise to review

asset allocation annually; however, rebalancing should be done only if the investment objective or risk

appetite undergoes a change.

Always remember that for reaping true benefit out of any financial investment, it is essential to

understand your financial goal, the risk you are willing to take and the period for which you are willing

to invest. It is also important to follow a disciplined approach towards investments and avoid timing

the market.

It must be noted that life insurance should be considered as a unique asset class in itself, since it

creates an asset in case of an eventuality like death where it provides the dependents with a lump

sum amount to meet future goals. ULIPs are well crafted to address the varying asset allocation

needs of individuals. They offer a basket of funds with different asset compositions to suit individual’s

profile. While choosing a fund option, it is essential to assess one’s asset allocation requirements and

accordingly make investments to optimize returns while assuming comfortable levels of risk. Further,

the flexibility to switch fund options should be resorted to in the light of changing individual’s needs

and not as a tool to speculate market movements.

Arpita Nanoti

Head – Investment Communication & Advisory

GROUP

Inception Date

Fund Return BM Fund Return BM Fund Return BM Fund Return BM

Last 1 year 6.55% 5.97% 5.57% 5.07% 3.84% 4.10% 4.20% 3.42%

Last 2 years 6.19% 5.04% 5.71% 4.70% 5.13% 4.29% 5.74% 3.98%

Last 3 years 10.44% 8.60% 13.46% 11.55% 17.09% 14.46% 20.36% 16.38%

Last 4 year 8.79% 4.34% 7.94% 3.83% 9.34% 3.21% 13.22% -

Last 5 years 10.41% 6.39% 10.16% 6.85% 13.40% 7.35% - -

Since Inception 11.06% - 14.26% - 15.92% - 13.12% -

Asset Held (Rs. In

Crores)

GROUP

Inception Date

Fund Return BM Fund Return BM Fund Return BM Fund Return BM Fund Return BM

Last 1 year 9.37% 7.13% 9.80% - 10.00% 7.07% 9.50% 7.37% 14.18% 7.07%

Last 2 years 8.36% 5.88% 8.69% - 9.02% 5.41% 8.23% 5.51% - -

Last 3 years 9.19% 4.82% 9.41% - 9.93% 4.63% 8.26% - - -

Last 4 year 10.61% - 11.42% - 12.75% 4.73% - - - -

Last 5 years 10.95% - 11.85% - 12.18% 5.35% - - - -

Since Inception 9.61% - 11.53% - 8.40% 8.49% - 10.07% 5.35%

Asset Held (Rs. In

Crores)

Fund Name

21

168 165 60

19-Jun-01 31-Aug-01 31-Aug-01

Fixed Interest

105

30-Mar-05

Money Market

28-Jan-07

644 345 189

23-Mar-1010-Dec-0818-Nov-02

1

Income Advantage

FUND PERFORMANCE AS ON 29TH FEBRUARY 2012

Secure Stable Growth Growth Advantage

18-Feb-08

Bond Short Term Debt

Benchmark Composition SFINFund Name

Secure BSE 100

Stable BSE 100

Growth BSE 100

Growth Advantage BSE 100

Money Market -

Income Advantage -

Fixed Interest -

Short Term Debt Fund -

Bond Fund -

Crisil Composite Bond Index

Crisil Short Term Bond Index

ULGF00416/07/02BSLGFIXINT109

ULGF01322/09/08BSLGSHTDBT109

-

Disclaimer:

This document is issued by BSLI. While all reasonable care has been taken in preparing this document, no responsibility or liability is accepted for errors of

fact or for any opinion expressed herein. This document is for information purposes only. It does not constitute any offer, recommendation or solicitation to

any person to enter into any transaction or adopt any investment strategy, nor does it constitute any prediction of likely future movements in NAVs. Past

performance is not necessarily indicative of future performance. We have reviewed the report, and in so far as it includes current or historical information, it

is believed to be reliable though its accuracy or completeness cannot be guaranteed. Neither Birla Sun Life Insurance Company Limited, nor any person

connected with it, accepts any liability arising from the use of this document. You are advised to make your own independent judgment with respect to any

matter contained herein.

Benchmark Composition





Crisil Liquid Fund Index

Crisil Composite Bond Index ULGF01425/02/10BSLGINCADV109

ULGF00530/05/03BSLIGRBOND109

ULGF00212/06/01BSLGSECURE109

SFIN

ULGF00312/06/01BSLGSTABLE109

ULGF00112/06/01BSLGGROWTH109

ULGF01026/11/07BSLIGGRADV109

ULGF00824/08/04BSLIGRMMKT109

SECURITIES HOLDING

GOVERNMENT SECURITIES 26.37%

7.8% GOVERNMENT OF INDIA 2021 3.85%










OTHER GOVERNMENT SECURITIES 6.69%

CORPORATE DEBT 36.06%

8.9% STEEL AUTHORITY OF INDIA LTD. 2019 2.96%

9.15% LARSEN AND TOUBRO LTD. 2019 2.65%

11.45% RELIANCE INDUSTRIES LTD. 2013 1.75%

10.9% RURAL ELECTRIFICATION CORPN. LTD. 2013 1.61%


9.47% POWER GRID CORPN. OF INDIA LTD. 2012 1.24%

9.05% RALLIS INDIA LTD. 2013 1.18%

10.25% TECH MAHINDRA LTD. 2014 1.10%

9.5% NATIONAL BANK FOR AGRI. AND RURAL DEVELOPMENT 20120.99%

10.48% SUNDARAM FINANCE LTD. 2013 0.97%

OTHER CORPORATE DEBT 20.36%

EQUITY 19.50%

RELIANCE INDUSTRIES LTD. 1.36%

Asset Allocation

Secure Fund ULGF00212/06/01BSLGSECURE109 Portfolio as on 29th February 2012

Rating Profile

About the FundObjective: To build capital and generate better returns at moderate level of risk, over amedium or long-term period through a balance of investment in equity and debt.

Strategy: Generate better returns with moderate risk level through fixed income portfolioand focus on creating long term equity portfolio which will enhance yield of compositeportfolio with low level of risk appetite.

AA2.63%

AA-3.06%

AA+5.70%

Sovereign

MMI18.07%

G-Secs26.37%

Equities19.50%

NCD36.06%


INFOSYS LTD. 1.23%

I C I C I BANK LTD. 1.12%

I T C LTD. 1.06%

STATE BANK OF INDIA 0.94%

BHARTI AIRTEL LTD. 0.90%

LARSEN AND TOUBRO LTD. 0.87%

H D F C BANK LTD. 0.74%

HOUSING DEVELOPMENT FINANCE CORPN. LTD. 0.68%

TATA CONSULTANCY SERVICES LTD. 0.52%

OTHER EQUITY 10.10%

MMI 18.07%

Maturity Profile

Sectoral Allocation

1.25%

1.30%

1.84%

3.59%

4.60%

5.07%

6.27%

6.60%

8.20%

8.24%

9.65%

10.88%

10.94%

20.56%

OTHERS

CEMENT

DIVERSIFIED

POWER GENERATION AND SUPPLY

TELECOMMUNICATION

AUTOMOBILE

METAL

PHARMACEUTICALS

FINANCIAL SERVICES

CAPITAL GOODS

FMCG

OIL AND GAS

SOFTWARE / IT

BANKING

43.04%

18.00%

38.96%

5.70%

P1+/A1+16.08%

AAA37.09%

Sovereign35.44%

May-0

4A

ug-0

4N

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4F

eb-0

5M

ay-0

5A

ug-0

5N

ov-0

5F

eb-0

6M

ay-0

6A

ug-0

6N

ov-0

6F

eb-0

7M

ay-0

7A

ug-0

7N

ov-0

7F

eb-0

8M

ay-0

8A

ug-0

8N

ov-0

8F

eb-0

9M

ay-0

9A

ug-0

9N

ov-0

9F

eb-1

0M

ay-1

0A

ug-1

0N

ov-1

0F

eb-1

1M

ay-1

1A

ug-1

1N

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1F

eb-1

2

Secure BM

1.00%AUTO ANCILLIARYLess than 2 years 2 to 7years 7years & above

SECURITIES HOLDING












OTHER GOVERNMENT SECURITIES 2.44%





8.7% POWER FINANCE CORPN. LTD. 2020 1.63%



9.4% NATIONAL HOUSING BANK 2013 1.38%


8.55% TATA MOTORS FINANCE LTD. 2012 1.35%

12.65% CHOLAMANDALAM INVESTMENT AND FINANCE CO. LTD. 20141.35%


EQUITY 34.08%

Asset Allocation

Stable Fund ULGF00312/06/01BSLGSTABLE109Portfolio as on 29th February 2012

Rating Profile

About the FundObjective: To grow your capital through enhanced returns over a medium to longterm period through investments in equity and debt instruments, thereby providing agood balance between risk and return.

Strategy: To earn capital appreciation by maintaining diversified equity portfolio andseek to earn regular return on fixed income portfolio by active management resultingin wealth creation for policyholders.

AA+1.20%

AA-6.97%

MMI13.02%

G-Secs21.67%

Equities34.08%

NCD31.23%


INFOSYS LTD. 2.15%


I T C LTD. 1.86%







OTHER EQUITY 17.71%

MMI 13.02%

Maturity Profile

Sectoral Allocation

1.83%

2.27%

3.61%

4.55%

5.06%

6.31%

6.69%

8.20%

8.31%

9.62%

10.89%

10.94%

20.44%

DIVERSIFIED

OTHERS


TELECOMMUNICATION

AUTOMOBILE

METAL

PHARMACEUTICALS

FINANCIAL SERVICES

CAPITAL GOODS

FMCG

OIL AND GAS

SOFTWARE / IT

BANKING

45.86%

21.42%

32.72%

1.20% 6.97%P1+/A1+15.70%

Sovereign34.54%

AAA41.60%

May-0

4A

ug-0

4N

ov-0

4F

eb-0

5M

ay-0

5A

ug-0

5N

ov-0

5F

eb-0

6M

ay-0

6A

ug-0

6N

ov-0

6F

eb-0

7M

ay-0

7A

ug-0

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ov-0

7F

eb-0

8M

ay-0

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ug-0

8N

ov-0

8F

eb-0

9M

ay-0

9A

ug-0

9N

ov-0

9F

eb-1

0M

ay-1

0A

ug-1

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ov-1

0F

eb-1

1M

ay-1

1A

ug-1

1

Nov-1

1F

eb-1

2

Stable BM

1.30%CEMENTLess than 2 years 2 to 7years 7years & above

SECURITIES HOLDING












8.48% L I C HOUSING FINANCE LTD. 2013 2.29%

5.9% H D F C BANK LTD. 2014 1.72%


10.05% MARICO LTD. 2013 1.38%

9.4% NATIONAL BANK FOR AGRI. AND RURAL DEVELOPMENT 2014 1.37%

8.5% INFRASTRUCTURE DEVELOPMENT FINANCE CO. LTD. 2012 1.36%

9.05% STATE BANK OF INDIA 2020 1.36%

9.25% DR. REDDYS LABORATORIES LTD. 2014 1.02%

8.2% ASHOK LEYLAND LTD. 2015 1.00%


EQUITY 49.17%


Growth Fund ULGF00112/06/01BSLGGROWTH109

Portfolio as on 29th February 2012

Asset Allocation

Rating Profile

About the FundObjective: To achieve optimum balance between growth and stability to providelong-term capital appreciation with balanced level of risk by investing in fixed incomesecurities and high quality equity security.

Strategy: To ensure capital appreciation by simultaneously investing into fixedincome securities and maintaining diversified equity portfolio. Active fundmanagement is carried out to enhnce policyholder’s wealth in long run.

AA-2.15%

AA+2.19% AA

4.08%

P1+/A1+15.51%

AAA40.50%

G-Secs16.56%

MMI11.50%

NCD22.77%

Equities49.17%


INFOSYS LTD. 3.12%


I T C LTD. 2.68%







OTHER EQUITY 25.59%

MMI 11.50%

Maturity Profile

Sectoral Allocation

1.30%

1.82%

2.25%

3.61%

4.55%

5.06%

6.31%

6.72%

8.19%

8.31%

9.62%

10.90%

10.94%

20.40%

CEMENT

DIVERSIFIED

OTHERS


TELECOMMUNICATION

AUTOMOBILE

METAL

PHARMACEUTICALS

FINANCIAL SERVICES

CAPITAL GOODS

FMCG

OIL AND GAS

SOFTWARE / IT

BANKING

35.90%

21.71%

42.39%

Less than 2 years 2 to 7years 7years & above

Sovereign35.57%

May-0

4A

ug-0

4N

ov-0

4F

eb-0

5M

ay-0

5A

ug-0

5N

ov-0

5F

eb-0

6M

ay-0

6A

ug-0

6N

ov-0

6F

eb-0

7M

ay-0

7A

ug-0

7N

ov-0

7F

eb-0

8M

ay-0

8A

ug-0

8N

ov-0

8

Feb-0

9M

ay-0

9A

ug-0

9N

ov-0

9

Feb-1

0M

ay-1

0A

ug-1

0

Nov-1

0F

eb-1

1M

ay-1

1A

ug-1

1

Nov-1

1F

eb-1

2

Gr. Growth BM


SECURITIES HOLDING















6.1% NUCLEAR POWER CORPN. OF INDIA LTD. 2014 2.25%


2% INDIAN HOTELS CO. LTD. 2014 1.11%




11.95% HOUSING DEVELOPMENT FINANCE CORPN. LTD. 20180.54%

10.48% ULTRATECH CEMENT LTD. 2013 0.49%

Rating Profile

Asset Allocation

Growth Advantage Fund ULGF01026/11/07BSLIGGRADV109Portfolio as on 29th February 2012 About the Fund

Objective: To provide blend of fixed return by investing in debt & moneymarket instruments and capital appreciation by predominantly investing inequities of fundamentally strong and large blue chip companies.Strategy: To build and actively manage a well-diversified equity portfolio ofvalue & growth driven stocks by following a research-focused investmentapproach. While appreciating the high risk associated with equities, the fundwould attempt to maximize the risk-return pay-off for the long-termadvantage of the policyholders. The non-equity portion of the fund will beinvested in high rated debt and money market instruments and fixeddeposits.

AA+

MMI14.48%

G-Secs13.12%

NCD14.04%

Equities58.36%


EQUITY 58.36%


INFOSYS LTD. 3.57%


I T C LTD. 3.18%







OTHER EQUITY 30.40%

MMI 14.48%

Maturity Profile

Sectoral Allocation

54.03%

15.44%

30.53%

AA+3.51%

P1+/A1+14.14%

AAA40.86%

Sovereign41.48%

1.30%

1.85%

2.28%

3.67%

4.35%

4.88%

6.37%

6.82%

8.28%

8.35%

9.62%

10.77%

10.84%

20.63%

CEMENT

DIVERSIFIED

OTHERS


TELECOMMUNICATION

AUTOMOBILE

METAL

PHARMACEUTICALS

FINANCIAL SERVICES

CAPITAL GOODS

FMCG

SOFTWARE / IT

OIL AND GAS

BANKING

Apr-08

Jun-0

8

Aug-0

8

Oct-08

Dec-0

8

Feb-0

9

Apr-09

Jun-0

9

Aug-0

9

Oct-09

Dec-0

9

Feb-1

0

Apr-10

Jun-1

0

Aug-1

0

Oct-10

Dec-1

0

Feb-1

1

Apr-11

Jun-1

1

Aug-1

1

Oct-11

Dec-1

1

Feb-1

2

Gr. Advantage BM


1.30%CEMENT

SECURITIES HOLDING



EQUITY 0.00%

MMI 100.00%

SHAPOORJI PALLONJI AND COMPANY LTD CP (MD 29/06/2012)8.63%

RANBAXY LABORATORIES LTD CP (MD 22/10/2012) 8.40%

CHOLAMANDALAM INVST AND FINANCE CP (MD 15/10/2012)7.70%

BAJAJ ELECTRICALS LTD CP (MD 20/04/2012) 5.76%

KOTAK MAHINDRA PRIME LTD CP (MD 08/06/2012) 5.71%

INFRASTRUCTURE DEVELOPMENT FINANCE CO. LTD. CP (MD 06/08/2012)5.71%

ADITYA BIRLA FINANCE LTD CP (MD 14/09/2012) 5.55%

G I C HOUSING FINANCE LTD. CPM (MD 21/09/2012) 5.54%

STATE BANK OF HYDERABAD CD (MD 06/12/2012) 5.53%

PUNJAB NATIONAL BANK CD (MD 29/11/2012) 5.24%

OTHER MMI 36.22%

Money Market Fund ULGF00824/08/04BSLIGRMMKT109


Asset Allocation

Rating Profile

About the FundObjective: To provide reasonable returns, at a high level of safety andliquidity for capital conservation for the Policyholder

Strategy: To make judicious investments in high quality debt and moneymarket instruments to protect capital of the Policyholder with very lowlevel of risk

MMI100.00%

Maturity Profile

100.00%

Less than 1 year

P1+/A1+100.00%

Apr-

08

Jun-0

8

Aug-0

8

Oct-

08

Dec-0

8

Feb-0

9

Apr-

09

Jun-0

9

Aug-0

9

Oct-

09

Dec-0

9

Feb-1

0

Apr-

10

Jun-1

0

Aug-1

0

Oct-

10

Dec-1

0

Feb-1

1

Apr-

11

Jun-1

1

Aug-1

1

Oct-

11

Dec-1

1

Feb-1

2

MM BM

SECURITIES HOLDING



7.73% BHARAT PETROLEUM CORPN. LTD. 2012 7.24%


8.5% INFRASTRUCTURE DEVELOPMENT FINANCE CO. LTD. 20124.62%



9.72% INFRASTRUCTURE DEVELOPMENT FINANCE CO. LTD. 20134.16%

7.35% HINDUSTAN PETROLEUM CORPN. LTD. 2012 3.60%

10.48% SUNDARAM FINANCE LTD. 2013 3.02%




SECURITISED DEBT 0.00%

MMI 51.23%

Asset Allocation

Rating Profile

Short Term Debt Fund ULGF01322/09/08BSLGSHTDBT109

Portfolio as on 29th February 2012 About the FundObjective: To provide capital preservation at a high level of safety &

liquidity through judicious investments in high quality short‐term debtinstruments

Strategy: To actively manage the fund by building a portfolio of fixedincome instruments with short term duration. The fund will invest ingovernment securities, high rated corporate bonds, good quality moneymarket instruments and other fixed income securities. The quality &duration of the assets purchased would aim to minimize the credit risk andliquidity risk of the portfolio. The fund will maintain reasonable level ofliquidity.

AA-

MMI51.23%

NCD48.77%

MMI 51.23%

Maturity Profile

87.48%

12.52%

Less than 2 years 2 to 7years

AA-2.06%

AA5.13% AA+

8.60%

P1+/A1+40.26%

AAA43.96%

Jul-09

Aug-0

9S

ep-0

9O

ct-

09

Nov-0

9D

ec-0

9Jan-1

0F

eb-1

0M

ar-

10

Apr-

10

May-1

0Jun-1

0Jul-10

Aug-1

0S

ep-1

0O

ct-

10

Nov-1

0D

ec-1

0Jan-1

1F

eb-1

1M

ar-

11

Apr-

11

May-1

1Jun-1

1Jul-11

Aug-1

1S

ep-1

1O

ct-

11

Nov-1

1D

ec-1

1Jan-1

2F

eb-1

2

Short Term Debt BM

SECURITIES HOLDING






10.6% INDIAN RAILWAY FINANCE CORPN. LTD. 2018 9.51%

9.9% HOUSING DEVELOPMENT FINANCE CORPN. LTD. 2018 9.11%




MMI 30.10%

Income Advantage Fund ULGF01425/02/10BSLGINCADV109


Asset Allocation

Rating Profile

About the FundObjective: To provide capital preservation and regular income, at a highlevel of safety over a medium term horizon by investing in high quality debtinstruments

Strategy: To actively manage the fund by building a portfolio of fixedincome instruments with medium term duration. The fund will invest ingovernment securities, high rated corporate bonds, high quality moneymarket instruments and other fixed income securities. The quality of theassets purchased would aim to minimize the credit risk and liquidity risk ofthe portfolio. The fund will maintain reasonable level of liquidity.

MMI30.10%

G-Secs33.47%

NCD36.43%

Maturity Profile

47.18%

18.88%

33.94%


P1+/A1+19.34%

Sovereign38.62%

AAA42.04%

Mar-

10

Apr-

10

May-1

0

Jun-1

0

Jul-10

Aug-1

0

Sep-1

0

Oct-

10

Nov-1

0

Dec-1

0

Jan-1

1

Feb-1

1

Mar-

11

Apr-

11

May-1

1

Jun-1

1

Jul-11

Aug-1

1

Sep-1

1

Oct-

11

Nov-1

1

Dec-1

1

Jan-1

2

Feb-1

2

Gr. Inc Adv BM

SECURITIES HOLDING











EQUITY 0.00%

MMI 20.58%

Gilt Fund ULGF00630/05/03BSLIGRGILT109Portfolio as on 29th February 2012

Asset Allocation

Rating Profile

About the FundObjective: To deliver safe and consistent returns over a long-term period byinvesting in Government Securities.

Strategy: Active fund management at very low level of risk by having entireexposure to government securities & money marketinstruments, maintaining medium term duration of the portfolio to achievecapital conservation.

MMI20.58%

G-Secs79.42%

Maturity Profile

20.13%

40.15% 39.72%


Sovereign100.00%

SECURITIES HOLDING



NATIONAL HOUSING BANK 2019 6.20%

9.8% L I C HOUSING FINANCE LTD. 2014 5.86%




7.7% N H P C LTD. 2014 2.93%

9.75% TATA MOTORS LTD. 2020 2.87%

RURAL ELECTRIFICATION CORPN. LTD. 2020 2.74%

NATIONAL BANK FOR AGRI. AND RURAL DEVELOPMENT 2019 2.52%

9.68% TATA SONS LTD. 2017 2.46%



EQUITY 0.00% Rating Profile

Asset Allocation

Bond Fund ULGF00530/05/03BSLIGRBOND109

Portfolio as on 29th February 2012About the FundObjective: To achieve capital preservation along with stable returnsby investing in corporate bonds over medium-term period.

Strategy: To invest in high credit rated corporate bonds, maintaininga short-term duration of the portfolio at a medium level of risk toachieve capital conservation.

MMI16.73%

NCD83.27%

MMI 16.73%

Maturity Profile

31.31%

39.54%

29.16%


AA4.31%

P1+/A1+4.52%

AA+5.45%

AA-10.91%

AAA74.81%

SECURITIES HOLDING













9.75% HOUSING DEVELOPMENT FINANCE CORPN. LTD. 2016 5.39%



NATIONAL BANK FOR AGRI. AND RURAL DEVELOPMENT 2018 3.87%

9.68% TATA SONS LTD. 2017 2.90%






Rating Profile

Asset Allocation

Fixed Interest Fund ULGF00416/07/02BSLGFIXINT109

Portfolio as on 29th February 2012 About the FundObjective: To achieve value creation at low risk over a long-term horizonby investing into high quality fixed interest securities.

Strategy: To actively manage the fund at a medium level of risk by havingentire exposure to government securities, corporate bonds maintainingmedium to long-term duration of the portfolio to achieve capitalconservation.

G-Secs26.02%

MMI17.26%

NCD56.72%

2.32%


EQUITY 0.00%

MMI 17.26%

Maturity Profile

29.33%

37.69%

32.99%


AA+2.18%

P1+/A1+5.59% AA-

5.95%

AAA56.59%

Sovereign29.69%

May-0

4A

ug-0

4N

ov-0

4F

eb-0

5M

ay-0

5A

ug-0

5N

ov-0

5F

eb-0

6M

ay-0

6A

ug-0

6N

ov-0

6F

eb-0

7M

ay-0

7A

ug-0

7N

ov-0

7F

eb-0

8M

ay-0

8A

ug-0

8N

ov-0

8F

eb-0

9M

ay-0

9A

ug-0

9N

ov-0

9F

eb-1

0M

ay-1

0A

ug-1

0N

ov-1

0F

eb-1

1M

ay-1

1A

ug-1

1N

ov-1

1F

eb-1

2

FIF BM

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