india investment review 2014 & outlook 2015

12
YOUR LOGO Indian Asset markets SHIFT to the financial assets or regret. Outlook 2015 Right Horizons PMS For private circulation only

Upload: vinayak-kanvinde

Post on 14-Jul-2015

222 views

Category:

Economy & Finance


2 download

TRANSCRIPT

Page 1: India Investment Review 2014 & Outlook 2015

YOUR LOGO

Indian Asset markets – SHIFT to the financial assets or regret.

Outlook 2015

Right Horizons PMS

For private circulation only

Page 2: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 2

Agenda / Table of contents

A review of the asset markets in 20141

The bull market has started2

Luck, Sentiment, tailwinds – call it what you will3

Buying that dip is the right way to get it right4

Opportunity in financial markets – Outlook 20155

Get ready to be overwhelmed!

Right Horizons PMS – Keeping the head down!6

For private circulation only

Page 3: India Investment Review 2014 & Outlook 2015

YOUR LOGO

Asset market have clear diversion – time to bet clear Equities had everything going for them in

2014.

- Clear political mandate and a government which

projects business

- Marked change in macro-economic indicators –

inflation, fiscal deficit, CAD

- Stabilizing industry data and better corporate health

Bond / Debt have also begin to factor in the

benign interest rate scenario, though on-

ground policy remains cautious

Gold continued to provide worst

performance now also from Indian context;

globally it continues to lose in successive

years– falling over 7% in USD terms.

Real estate in metros has stagnated in

2014, inventories continue to pile, fresh

projects stalled and deliveries slowed

considerably

Page 3

A review of the asset markets in India - 20141

For private circulation only

-20.00%

-10.00%

0.00%

10.00%

20.00%

30.00%

40.00%

50.00%

60.00%

Equities -Nifty

Equities -CNX Mid

Cap

Bond -Short Term

Bond -Long Term (GILT)

Gold -ETF

Real Estate -

Tier I

Asset return in 2014#

in India

# YTD Nov 30th 2014

Page 4: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 4

The bull market has started2

For private circulation only

We talked about these during last year

outlook for 2014. The one critical indicator

has now turned Green. Other are expected

to follow soon.

The trough to peak index value in the

last bull run was 7x and if the same

multiple were to applied, we end

up around a number over 60,000 on

the Sensex in the next 3 years!!!

Sensex EPS: Bloomberg analyst consensus estimates.

Page 5: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 5

The bull market has started2

For private circulation only

Psychology of calling peaks in a BULL market: Most times, most people get it wrong. The

essence is the get the math right and getting the pulse of participants. 50% science, 50% art.

Markets at previous

highs. Deep correction

envisaged , mood had

been pessimistic.

Uncharted territory.

Correction coming and

market not driven by

fundamentals.

Crash eminent.

Markets running

ahead of

fundamentals.

Oh man! Past 4

Years the markets

are on FIRE! Participate

or perish!

Nobody has ever

Made money in

the stock markets!!!

Source: Yahoo charts

7 year period

Page 6: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 6

Luck, sentiment, tailwinds...call it what you will!3

For private circulation only

LuckDef

: the things that happen to a person because of chance

: the accidental way things happen without being

planned

: good fortune : good luck

: success in doing or getting something

Factor #1: Falling commodity

prices – predominantly Crude and

energy.

Factor #2: Falling Gold prices

despite apparent monetary

stimulus by central banks

Factor #3: Unprecedented

government mandate; something

happening once in 30 years.

Factor #4: Best amongst the

worse. Timing for India in the

emerging markets.

SentimentDef

: an attitude or opinion

: feelings of love, sympathy, kindness, etc

Factor #1: Never before

mandate could cure policy

issues

Factor #2: Businesses could

move at higher speed than

before. Sales and profits could

be higher

Factor #3: Higher confidence

and feel good amongst citizens

Factor #4: productivity is

going to be rewarded

tailwindDef

: a wind that blows in the same direction as

something (such as a ship or an airplane) that

is moving forward

Impact #1: A combination of

luck and sentiment has

resulted in India becoming

„HOT‟ destination to do

business.

Impact #2: Foreign inflows

have boosted financial asset

prices

Impact #3: World press has

taken notice of this

combination of Luck +

Sentiment = positive

coverage.

NET Result = A balloon which can go only up. A balloon which has air

cannot sink in water. Water is lighter than air. Physics 101.

Page 7: India Investment Review 2014 & Outlook 2015

YOUR LOGO

Remember! Equities markets are for long term. If you keep buying and stay invested; you CAN make money!

BUY LOW, SELL HIGH, NOT the other way round. Please repeat this 10 times.

Page 7

Buying that dip is the way to get it right...4

For private circulation only

BUY that DIP

The higher the fall,

the more you buy.

Sigh!

Easier said

than done!

Page 8: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 8

The opportunity in the financial markets5

For private circulation only

Outlook 2015

It’s advantage financial asset class. Fixed Income and equities are the real favorites for 4th year in a row.

1. We expect the equities markets to face some short term hiccups and a minor pull-back during the

Jan-March 2015 period and then head higher levels.

2. We believe that 31st December 2015 target to be in the range of 9500-10000 on the CNX Nifty Index and

around 32,000-33,000 on the Sensex.

This translates to a 2015 calendar return of around 16-18% on the expected close of

around 34% annual return that is expected to be for 2014

The wild card is on the fixed income asset class1. We believe that short term funds could provide decent double digit (annualized) returns over the 6-9 month

time frame.

2. Medium to long duration fixed income funds/securities could return 18%-22% range for calendar 2015

3. For Gilt (medium / long duration) funds the return could be mover 25% for funds that are managed well

Overall, we expect balanced (hybrid) funds to do extremely well during 2015

since they could utilize the best of both worlds. We favor a combination

portfolio approach to get steady yet high yield on these category of

investments.

Page 9: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 9

Right Horizons PMS portfolios – wealth creation vehicles6

For private circulation only

Portfolio Strategy

Nifty Plus FlexicapCapital Protection

Super Value

Fixed Income

ObjectiveLong term Wealth

creation

Long term weath

creation

Lower Capital

Volatility

Provide for high

capital

appreciation

Provide for

Inflation beating

returns

Predominantly

invests in

Equities

• Nifty Index stocks

• BSE 200 stocks

Equities

•BSE 500 stocks

Fixed Income

securities

• Listed securities

(80%)

• Equity Indices

Equities

• Mid-cap

Equities

Fixed Income

Securities

• 100%

listed/Unlisted

Fixed income

securities

Recommended

Holding Horizon> 18 months > 30 months 24 months >36 months 12 months

Portfolio StrategyBUY & Hold; Weight

Management

BUY & Hold;

Thesis Driven

BUY & Hold;

Trading Driven

Active

Strategy;

Bottom Up

BUY & Hold;

Risk Level Medium Medium Low High Low to Medium

Minimum Strategy

Size1 INR 1million INR 1million INR 1million INR 1million INR 1million

1 Each PMS account shall be a minimum of INR25,00,000 set up value

Page 10: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 10

Portfolios – Outperform! – Keeping the head down.6

For private circulation only

All time frames based on Nov 30 2014 data; Inception dates vary with respect to the different benchmarks adopted by the portfolios

Portfolio Performance

(%)

1 month 3 months 6 months 1 year Since Inception

Nifty Plus 6.46% 8.49% 19.11% 44.13% 36.74%

Flexicap 3.56% 5.32% 13.54% 31.35% 25.24%

Super Value (Mid & Small cap) 6.52% 15.08% 31.77% 67.19% 25.75%

CNX Nifty Index 5.75% 7.22% 15.17% 39.88% 28.73%

CNX MidCAP Index 5.71% 9.51% 18.82% 61.78% 25.05%

Alliance Portfolio (Equity

Oriented Hybrid)

4.30% 6.39% - - 7.67%

Capital Protection 0.99% 2.28% 6.29% 12.54% 10.70%

GSEC Index 0.88% 2.20% 3.50% 6.46% 4.69%

Page 11: India Investment Review 2014 & Outlook 2015

YOUR LOGO

Disclaimer

Page 11

For private circulation only

The information contained herein has been obtained from reports secured from third parties, publicly available sources and

Right Horizons, its affiliates, subsidiaries and/or Group companies take no responsibilities – express or implied for

inaccuracies contained herein.

This document is meant for the use of the intended recipient only. Though dissemination to all intended recipients is

simultaneous, not all intended recipients may receive this document at the same time. This document is neither an offer nor

solicitation for an offer to buy and/or sell any securities mentioned herein and/or official confirmation of any transaction.

This document is provided for assistance only and is not intended to be, and must not be taken as, the sole basis for an

investment decision. The user assumes the entire risk of any use made of this information. Each recipient of this document

should make such investigation as he deems necessary to arrive at an independent evaluation, including the merits and risks

involved, for investment in the securities referred to in this document and should consult his own advisors to determine the

merits and risks of such investment.

The investment discussed or views expressed may not be suitable for all investors. This document has been prepared on the

basis of information obtained from publicly available, accessible resources. Right Horizons has not independently verified all

the information given in this document. Accordingly, no representation or warranty, express or implied, is made as to

accuracy, completeness or fairness of the information and opinion contained in this document.

The information given in this document is as of the date of this document and there can be no assurance that future results

or events will be consistent with this information. Though Right Horizons endeavors to update the information contained

herein on reasonable basis, Right Horizons, its associate companies, their directors, employees, agents or representatives

(“Right Horizons and its affiliates”) are under no obligation to update or keep the information current. Also, there may be

regulatory, compliance or other reasons that may prevent us from doing so.

Right Horizons and its affiliates expressly disclaim any and all liabilities that may arise from information, error or omission in

this connection. Right Horizons and its affiliates shall not be liable for any damages whether direct, indirect, special or

consequential, including lost revenue or lost profits, which may arise from or in connection with the use of this document.

This document is strictly confidential and is being furnished to you solely for your information. This document and/or any

portion thereof may not be duplicated in any form and/or reproduced or redistributed without the prior written consent of

Right Horizons.

Page 12: India Investment Review 2014 & Outlook 2015

YOUR LOGOPage 12

Reach us:[email protected]+91 80 4120 9582+91 22 4100 2018

Questions?

For private circulation only