The Money Navigator March 2016
Transcript of The Money Navigator March 2016
-
8/19/2019 The Money Navigator March 2016
1/361st March-2016 to 31st March-2016 www.jhaveritrade.co
F o r P r i v a t e C i r c u l a t i o n O n l y
Issue ThemePg. 1-6
Company AnalysisPg. 12-16
Value BuPg. 17-19
V A L U E B U Y
Markets have given a Thumbs-Up to the Union Budget which was extremely comprehensive & covered nearly evepart of theeconomy such as Infrastructure,agriculture, rural,housing, health insurance, markets. What hassupportethis upmove is also the fact the lot ofperceived negatives suchas tinkering withLTCG orsuper-rich tax orbasic excishike have not made it into the final budget draft. Crucial take-away is that the government is focused on the quality fiscaldeficit and stuck to their target of3.9%(FY16) & 3.5%(FY17).
Market Welcomes
UNION BUDGET 2016 17UNION BUDGET 2016-17
Fiscal Discipline
Agriculture
Rural Development
Infrastructure
Skill Developme
A Balanced Approac
ANALYSISBudget
-
8/19/2019 The Money Navigator March 2016
2/36www.jhaveritrade.com | www.jetrade.in
3DAYSFREE TRIAL
Open Trading cum Demataccount & get
For More Details Give Missed Call
08049336177
Register NowConditions Apply*
Get 10% Extra Benefit for Trade through Mob
-
8/19/2019 The Money Navigator March 2016
3/36
www.jhaveritrade.com
From The MD’s Desk
UnionBudget is one of the most awaited events for the Indian economy and the honorableFinance Minister, MrArun Jaitley
announced the 2nd Union Budget of the Modi Government. Government has been under extreme pressure as it has faced
criticism for failing to provide adequate relief to rural India reeling under the impact of two back-to-back droughts. Thus the
budgetpresentedin theparliament wasmore rural India focused compared to theurbanIndia.
The budget revolved around 9 themes – agriculture, social programs, rural development, education (emphasis on skill
development), infrastructure, financial reforms, policy reforms (emphasis on ease of doing business), fiscal discipline, and
tax reforms.
We believe that, the budget is neither very reformist nor very dull. The finance minister has delivered a balance budget
whichhaslong term solutionsof many issues.
As the market was down around 25% from its peak and many scripts were down by more than 50% in last three months, a
trigger wasrequired forbuying.Anaggressive shortcoveringcoupled with deliverybuyinghashappened in last fewdays.As
far as PSU Banks are concerned, RBI has allowed PSU banks to show their real estate holdings as tier-1 capital subject to
certain conditions. This move sparked the rally in PSU banks as the sector was oversold and closed to their long term
support zone.
Technically, theworld market, thecommoditymarketandeven Indianmarkets have formeda mediumterm bottom. TheFIIs
have aggressively sold emergingmarketequities including in India in last coupleof months. Whenever there is turnaround in
worldmarket, Indiawill be first to recover with crediblesustainability.
Turnaround in Earnings is still a question for the market. The chances of rate cut and bigger rural sector outlay in budget will
providethe platformforturnaround in corporateearnings.
Globally, the consensus is building in USA that the fed may not raise the rates in March considering the fluctuation in
economic data. Anystimulus byECBis also providingsupport to theequitymarket. Lookingat these international situations
andpossibility of passingsome importantbills, Indianmarket lookspositive from mediumterm perspective.
Technically, anysustainable rise above 7550-7600mayprovide theplatform to scale 8000. The important supports are
7400-7250.
Kamlesh Jhaveri ( MD )Jhaveri Securities Ltd.
The Budget has given necessary trigger to the market
-
8/19/2019 The Money Navigator March 2016
4/36
www.jhaveritrade.com
I s s u e T h e m e
ANALYSISBudget
Post Budget Analysis: 2016-17
1
Managing the trio Consumption + Investment + Fiscal Discipline: A BalanceBudget
TheUnion Budget for2016-17 lays down thegovernments long term growthagenda for thecountry, emphasizing structuralchanges andimprovementsacrosssegments that would transformthe nationanditseconomy.
The Union Budget has signaled the government's intention to remain responsible to fiscal targets, while being mindful of
investment andconsumption challenges to theIndianeconomy. Sticking to the3.5% fiscaldeficit target forFY17 hasbeen a
positive. In the budget, an inclusive growth strategy has been adopted with the farm and rural sector, social sector,
infrastructure sector, employment generation and recapitalization of the banks along with the vulnerable sections (rural
economy ) beingpriorityareas forexpenditure forthe government.
We believe that the finance minister has chosen and taken right steps in Union Budget. In the face of threatening globalfinancialproblems, theBudgetprovides credibility, a steadycourseforsteering theeconomy andwelcome improvements in
tax administration. However, what will go wrong on his agenda and perception is the weak global economy. If external
macroconditionwill weakenfurther what it wastoday, mayincorrecthis assumption.
Foreign investors withdrawn billions out of India in the current panic markets. They will be reassured by Jaitley's trio
measures. This fiscal ( stick to deficit target of 3.5%) prudence opens the way for interest rate cuts by the Reserve Bank of
India .
Conclusion
The Budget abstained from imposing any long-term capital gains tax and increasing service tax, which were muchanticipated by the market. In that sense, it's a positive. Moreover, the Budget should be taken positively by consumption,
agriculture, financial and infrastructure oriented sectors. On the flip side, the Budget may be viewed negatively by the
automobilesector. However, a revival in consumption augurswell from a long-termperspective. Though there's no major
surprise, the Budget should be taken positively by both equity and the bond markets. As the event is behind us, the market
shouldnowfocusoncues from globalmarkets andincremental economic data andcorporateearnings.
Rural Consumption Boost
` 35984 Cr. allot ted for agriculture sector
` 17000 Cr. for irrigation projects
` 9 Lakh Cr. Agriculture Credit Target
` 38500 Cr. for MANREGA, highest ever
` 2.87 Lakh corers to be spent on Villages in total
Meaningful Infrastructure
` 19000 Cr. for Gram Sadak Yojana
` 9000 crores for Swach Bharat Mission
` 97000 Crores for Roads
` Total Outlay on Roads
` 2.18 Lk Cr. on Railways
Fiscal Discipline
Fiscal deficit targets 2015-16 (RE)
at 3.9% and 2016-17 (Budget
Estimate) at 3.5%.
Revenue Deficit reduced to 2.5%
in 2015-16 (RE) from 2.8%
Plan expenditure of `5.50 lakh
Cr. / Non-Plan expenditur e of `14.28
lakh Cr.
-
8/19/2019 The Money Navigator March 2016
5/36
www.jhaveritrade.com
ANALYSISBudget
2
Post Budget Analysis: 2016-17
Post BudgetAnalysis : Major Trends
Fiscal Deficit TargetExpected tohave fiscaldeficit target range
FY17 fiscaldeficittarget at 3.5% of GDP
FY16 fiscaldeficitpegged at3.9% ofGDP
Prudence liesin adhering to fiscal targets
FY17Revenue and Expenditure Estimates in Fy17FY17 totalexpenditure19.78 trillion rupee / FY17 total spend at19.78 trillion rupees
FY17non-plan expenditure14.3 trillion rupees
FY17 plan expenditure5.5trillion rupee
Total resourcestostates in FY17 at 996billionrupees
To scrapplan,non-plan expendituredistinction
To doaway with plan, non-planclassificationof spending
Plan allocation tostresson rural, infra,socialsectors
The union Budget with an aim to boost investment in Agriculture, Social Sector, Infrastructure and employment generation
on the one hand and simultaneously sticking to the fiscal consolidation path. This is substantiated by a huge 15.3% jump in
plan outlay and 9% increase in non plan outlay in 2016-17. Besides additional allocation to meet the obligations of 7th pay
commission recommendationandimplementationof onerank onepension (OROP) inDefence have also been provided.
Summary of Accounts
FY13
879,232
582,152
1,243,514
166,858
1,410,372
1,410,372
365,896
490,597
177,428
` in Cr.
Revenue Receipts
Capital Receipts
Capital Expenditure
Total Receipts
Total Expenditure
Revenue Defici t
Fiscal Deficit
Primary Deficit
Revenue Expenditure
FY14
1,014,724
563,894
1,371,772
187,675
1,578,618
1,559,447
357,048
502,858
128,604
FY15
1,101,472
562,201
1,466,992
196,681
1,663,673
1,663,673
365,519
510,725
108,281
FY16 (RE)
1,206,084
579,307
1,547,673
237,718
1,785,391
1,785,391
341,589
535,090
92,469
FY17(BE)
1,377,022
601,038
1,731,037
247,023
1,978,060
1,978,060
354,015
533,904
41,234
-
8/19/2019 The Money Navigator March 2016
6/36
www.jhaveritrade.com
I s s u e T h e m e
ANALYSISBudget
Post Budget Analysis: 2016-17
Increasedallocation forroads, railwaysandurban development –24% increase in budgetaryallocation forroads,12%
increase formetroprojects,13%increase forrailways
Increasedallocation forportsandshipping - 24%increase inbudgetaryallocation forsugarmela project , 70%increase
inallocation forinlandwater transport
` 800crallocated towards theSagarmala& NationalWaterways Project
Stocks to watch : Sadbhav Engineering, PNC Infratech ,NCC,MBL infra
Service taxincreasedfrom 14.5%to15.0%owing to levy of 0.5% towards Krishi Kalyancess
Basic Customs Duty onwood chips andparticlesused in manufactureof paperandnews printsreduced from 5%tonil.
Stocks to watch : Dish TV, Den Networks
Highercapital outlay towards thedefense sector(up 6.9% yoyto` 69,705cr)
Higherallocation towards MinistryofUrbanDevelopment (focusonMetro,SmartCities,AMRUT;up 34%yoy to
`24,523cr)
Higherallocationof ` 8,500cr towards theRuralElectrificationprogram
12.5%CVD leviedonRoad ConstructionEquipments
Stocks to watch : BEL,L&T, Bharat forge,BEML
Increase in exciseduty on cigarettes by10%
Increase in exciseduty on mineral waterandaerated water containingaddedsugar
Cumulativeallocation of ` 87,765cr for ruraldevelopmentactivitiesandMGNREGA
Stocks to watch : ITC,VST Industries,and Godfrey Phillips.
Customduty onzinc alloys increasedfrom 5%to7.5%
Exportdutyon ironore lumps (below58% Fecontent)reduced tonil from30%
Basic customduty increasedonprimary aluminiumfrom 5%to7.5%
Stocks to watch : Hindalco, Nalco, Vedanta
Reductionin basiccustomduty forcoal, lignite, etc. increase inclean environment cess on inputssuch as coal, lignute on
thecement input costs
100% deductionof profits from development of housing projects& exemptionof service taxon development of
affordablehousing
Stocks to watch : UltraTech, Prism Cement
3
Infrastructure Outlook: Positive
Media Outlook: Positive
Capital Goods Outlook: Positive
FMCG Outlook: Neutral
Metals & Mining Outlook: Neutral
Cement Outlook: Positive
-
8/19/2019 The Money Navigator March 2016
7/36
www.jhaveritrade.com
ANALYSISBudget
Post Budget Analysis: 2016-17
4
Tax rebateof 10%on earnings from globalpatent filings.
Weighteddeductionsfor R&D proposed tobe revised to150% fromApril1, 2017 and100% fromApril1, 2020.
Tax rate of 10%(as against 35%) on incomefrom worldwideexploitation ofpatents developedandregistered in India.
3,000storesunderPrimeMinister’sJanAushadhiYojana will beopenedduring2016-17.
Stocks to watch : Sun Pharma,Dishman Pharma,Lupin, and Cadila Healthcare
100%deductionforprofits toanundertaking inhousing project for flats upto30 sq. metres in fourmetro citiesand 60sq.
metresin othercities, approvedduringJune 2016 toMarch2019 andcompletedin three years
Deduction foradditional interestof Rs.50,000perannumforloansup toRs.35 lakh sanctioned in 2016-17 for first timehome buyers, wherehousecost does notexceedRs.50 lakh
Stocks to watch : DLF, Prestige Estates
Capital infusionof Rs.25000Cr. inPSU banks in2016-17.
Allocation of Rs. 250 bn towards recapitalization of PSBs.
Debt recovery tribunalswill be strengthened.
Government owned general insurancecompanies tobe listed
Foreign investmentswill beallowed in theinsuranceandpension sectors in automaticrouteup to49%
Service taxonservicesprovided byassessingbodiesempanelled centrally reduced from 14.0%tonil
Toolsand tool kits formaintenance, repair, andoverhauling of aircrafthave been exempted from exciseduty
Stocks to watch : InterglobeAviation,Spice Jet and Jet Airways
Introduction of infrastructurecess:
1% forsmallPetrol/LPG/CNG cars;
2.5% forsmalldieselcars;
4%formid-size,largecars andSUVs
1%luxury tax oncarscostingRs.10 lakhormore
Central Government towork in coordinationwith Statestowards abolitionof permitregime thereby resultinginto
liberalization of passenger roadtransportsegment
Stocks to watch : Ashok Leyland, Eicher motors, Bajaj Auto and Tatamotors
Pharmaceuticals Outlook: Negative
Real Estate Outlook: Positive
Banking & Financial Services Outlook: Neutral
Aviation Outlook: Negative
Automobi le Outlook: Positive
-
8/19/2019 The Money Navigator March 2016
8/36
www.jhaveritrade.com
I s s u e T h e m e
ANALYSISBudget
Post Budget Analysis: 2016-17
5
Theexemptions from customs dutiesonspecifiedgoods imported forpetroleumexploration
Oil Industries Development cess reduced from Rs.4,500per tonne to20%advalorem
Withdrawal of deductionu/s80-IBof Income-taxActfor production of mineral oilandnatural gas
Stocks to watch : ONGC, Cairn India
Allocation of ` 1,804cr forskilldevelopment
Service taxonservicesprovidedbyassessingbodiesempanelledcentrally reduced from 14.0%tonil
Stocks to watch : MT Educare and NIIT
Basiccustomduty on refrigeratedcontainers reduced from 10%to 5%andexciseduty on thesame reduced from 12.5%
to6%.
Stocks to watch : Snowman Logistics, Gati and Navkar Corp
Basiccustomduty onelectrolysers,membranesandtheir parts requiredbycaustic soda/potash units (usingmembrane
cell technology) reduced from 2.5% tonil.
Stocks to watch : TataChemicals
An additional tax at the rate of 10% of gross amount of dividend will be payable by the recipients receiving dividend in
excessof `10 lakh per annum
Most ITcompaniesarecash rich andarehenceprospectivecandidates forhigh dividend payouts. Investors in these
companiessubject to receiptof dividend in excessof thesaid amountwill be impacted.
Stocks to watch : Budget is Negativefor thesector
Thegovernment expects revenue receiptsof `98,995cr inFY2017from thetelecom sectorby wayof spectrumreceipts
Telecomcompaniescould becompelled tobidaggressivelywhichcould lead to further deterioration in their financial
positions
Stocks to watch : TheBudget is Negative for theTelecom sector.
‘CleanEnvironment Cess’ increased from`200/ton to` 400/ton
Stocks to watch : Negative for power producers such as NTPC, JSW Energy etc.
Note : Our“StocksTo Watch” section isnotour stocks recommendation.We have mention thosestocks whicharelikely togetbenefits/
disadvantagesfromGovt.’smoves in thebudget in broader sense. Kindly, contactResearchDept.for stock recommendations.
Oil & Gas Outlook: Negative
Education Outlook: Positive
Logistics Outlook: Positive
Chemicals Outlook: Positive
Information Technology Outlook: Negative
Telecom Outlook: Negative
Power Outlook: Negative
-
8/19/2019 The Money Navigator March 2016
9/36
www.jhaveritrade.com
Railway BUDGET
Passenger Centric and Optimistic but implementation is Key
OverviewIndian Railway has presented a Railway Budget 2016-17 maintaining status quo on passenger fare rates and freight rates.
The railways have continued to focus on capacity expansion and improving the services. The plan outlay has been hiked by
21% to `1.21 lakh Cr. for FY2017. The railways has focused on improving customer services, whilealso laid down the plan
for reorganizing, restructuringand rejuvenation of the Indian Railways.
Performance
Therailways have exhibited sharp slippages from FY2016 targets. The freight loading target is revised down to 1107 million
tonnes forFY2016 from budgeted level of 1186 million tonnes. Theestimate forgross traffic receipts is scaleddown sharply
to ` 1.68 lakh Cr. from 1.84 lakh Cr.
Meanwhile, the operating ratio is showing improvement from 91.3% in FY2015 to 90% in FY2016, but it has overshoot the
budgeted levelof 88.5%.
Budget Estimates 2016-17
1) Gross TrafficReceipts estimated to rise 10.1% to ` 1,84,820 Cr. 2) Passenger earnings growthhasbeen peggedat 12.4
% to ` 51,012 Cr. 3) The freight traffic is pegged at incremental traffic of 50 million tonnes. Goods earnings is accordingly
proposed at ` 1,17,933 Cr. 4) Railways are preparing a Plan size of `1,21,000 Cr. in 2016-17. 5) Targets Operating Ratio
(OR) - 92%, restrictgrowth of OrdinaryWorkingExpensesby11.6% afterbuilding in immediate impactof7thPC
Investments and Resources
As per investments proposed under 5-year plans (FY2015-19), Railways envisage capex of ` 8.5 lakh cr, translating to
yearly run-rate of `1.7 lakh Cr. Capital outlay budgeted for FY2017 stands at ` 1.17 lakh cr, much lower than the `1.7 lakhcr/year targetsetunder the5-yearplan.
However, if we compare FY2017 budgeted numbers, to that of revised FY2016 numbers, than capex outlay has increased
by42.3%(vs40%increase in FY2016revisedbudgeted numbers in comparison toFY2015actual).
Railway Budget Update
6
Some Stocks from Rail budget
Key Initiatives Company Name Key Initiatives Company Name
50% more electrification
No hike in freight charges
Locomoti ve Factories for` 40,000 Cr.
CCTV for Surveillance
Three new freight corridors
KEC International, Kalpataru Power Transmisson, Siemens
Coal India, Ultratech Cement
BHEL, BEML
ZICOM
COCOR and Gateway
Wifi Services
Elevated Rail Corridors
Cold Storages on rail land
Multi model logistic park
17000 bio to ilets in t rains
D-Link, Smart Link
L&T, HCC, NCC, GammonInfra, Simplex Infrastructure
Snowman Logistics
Gateway DistriparksNavkar Corp
Sahyadri Industries,Stone India
-
8/19/2019 The Money Navigator March 2016
10/36
www.jhaveritrade.com
S e c t o r U p d a t e
7
Ceramic Sector
Global Ceramic Tiles Industry
Global ceramic tiles market is expected to reach USD 125.32 billion by 2020, according to a new study by Grand ViewResearch Inc. Demand for ceramic tiles has been driven by thegrowing construction and infrastructure industry, mainly in
the Asian economies of china, India and Indonesia. However, volatility in raw material prices and tightening of regulatory
guidelines to address growing environmental concerns have increased the production costs for ceramic tiles
manufacturers.
With the introduction of modern technology in designing and manufacturing, the market new verticals have emerged such
as 3D tiles, Germ-free tiles and designer tiles. Floor tiles are expected tobe the fastest growingsegment of the ceramic tiles
market growing at an estimated CAGR of 9.4% over the next five years. The wall tiles segment is expected to lose its pole
position to floor tiles by 2018. Government of India and china have increased spending on infrastructure improvement,
which is expected to promote the demand for residential and commercial structures and boost ceramic tiles market in thecoming years.
Indian ceramic IndustryIndia remains oneof thefastest growing ceramic tiles market in theworld. India’s share in theglobalceramic tiles production
iscontinuously increasing andhasreached 6.3% in 2013 from 5.7% in 2009.
India has not grown much in terms of exports of ceramic tiles and currently consists of less than 0.5% of the global market.
As per ICCTAS, in the year 2014 India has exported ceramic tiles of around USD 441 million. India exports ceramics to
markets acrossEurope,Asia, USandAfricaandthekeyexportmarketsareUAE,SaudiArabia andMalaysia.
A significant portion of the tiles’ manufacturers’ sales is to the institutional segment comprising builders and dealers. while
therest isdirectsales to theend consumersalso called thereplacement market. Thereplacement marketconstitutes15%-
20%of thetotal tiles marketIn India comparedwith around75%inwestern countries.
Theorganizedsegment makes up approximately 50%of thesectorand thetopeight manufacturers constitute over 75%of
theorganizedmarket.
Top 10 Countries by product ion of Ceramic Tiles (Million Square Meters)
60007050
6050
5050
4050
3050
2050
1050 903 825
425 420 410 382 360 315 230
50
C h i n a
B r a z
i l
I n d i a
S p a i n
I n d o
n e s i a
I r a n
I t a l y
V i e t
n a m
T u r k
e y
M e x
i c o
Ceramic Tiles importing Nations ( Million Square Meters)160
170
150
121
96 84 83 8068 65
53
U S A
S a u d
i A r a b i a
I r a q
F r a n
c e
N i g e
r i a
G e r m
a n y
R u s s
i a
T h a i l
a n d
S o u t h
K o r e
a
U A E
150
130
110
90
70
50
30
10
-
8/19/2019 The Money Navigator March 2016
11/36
www.jhaveritrade.com
Morbi development….structural shif t towards organized players
Morbi (Gujarat) is a hubof ceramic tile manufacturers in India with 500manufacturing units.Theregionproduces 65-70%ofthe total ceramic products in the country. One of the key reasons behind Morbi being the ceramic city is easy availability of
key raw materials like various types of clay, red and black soil, minerals (including calcite and wollastonite) with frits and
glazes readily available either locally or from neighboring Rajasthan. It is also cost effective since Gujarat State Petroleum
Corporation (GSPC)has installed industrial gasoline in theregion.
Also, since beginning of FY14, Gujarat Pollution Control Board (GPCB) restricted cargo handling at the Navlakhi port
(whichhandles 60%of coal for theceramic industry), leading toa severeshortage of coal. Moreover, post theclosure, Morbi
players have to bring coal from Kandla and Mundra ports where transportation cost is higher by 50%. Consequently,
unorganized players had to shift back to gas fired furnaces and the cost parity enjoyed by unorganized players went away.
Hence, these developmentswere structurallypositive fororganizedplayersandprovideda level playing field to them.
Growth driversUrbanization rate
India’s urban population has grown 2.47% annually over the last decade, making it the most rapidly urbanizing country.
India’s urban population is expected to increase from 32% today to 40% by 2020, strengthening the prospect s for tile
manufacturers.
By 2030, India is likely to emerge as the world’s largest middle class consumer market with aggregate consumer spends of
nearly US$13 trillion. Nuclear families are the overwhelming norm in India with 70% of households comprising just one
married couple, drivingthe need forquality housing.
Ceramic Sector
8
Country
Per capita consumption(square meter)
Brazil China Europe India Indonesia Iran Russia Vietnam
4.0 3.1 5.5 0.5 1.0 4.8 1.1 3.7
Urbanisation Rate (%)
1961 1971 1981 1991 2001 2011 2011 2020E
18.0 19.9
23.325.7
27.8
31.2 32.0
40.045.0
40.0
35.0
30.0
25.0
20.0
15.0
10.0
5.0
-
8/19/2019 The Money Navigator March 2016
12/36
www.jhaveritrade.com
S e c t o r U p d a t e
Ceramic Sector
Low per capita consumption
India currently has one of the lowest per capita consumption of 0.5 sqm as against the world average of 1.4 sqm Hence,there isa great scope ofgrowth for the ceramic industry in India.
Government initiativesThe new government has initiated a number of ambitious projects such as 100 smart cities, housing for all by 2022 and
swachh Bharat Abhyaan. several policy initiatives taken by the government to help the real estate and housing sector
includes the amendment of the FDI policy , setting up of real estate investment trusts, increase in deduction limit on housing
loan, relaxed normsfor issuing term bonds bybanks for financingaffordable housing etc. would actasa bigpush in demand
forthe ceramics industry in India over thecomingyears.
Change in demographicsThe youth population in India is fast growing and it is estimated that by 2020 Indiawill be the world’s youngest country. This
would lead to a shift in preference from low cost products from unorganized players to high end branded ceramic products.
this would leadto bettergrowth prospectsforthe organizedceramic industry.
Rapid growthIndia is witnessinga growing middleclass population.Thisbudding middleclass population would actas a keygrowthdriver
for the ceramic industry in India. 89 millionconsumingclass households and 45 million first time aspirer households in India
will bea major thrust for the housing sector in the nextdecade.
Increase in disposable income
Rapid industrialization and associated growth in income will propel the income level of India to those currently enjoyed by
global middle income countries, will boost the industry growth. With rising disposable income in India the demand for
replacementmarket forceramic tiles isexpected to further increase.
The per capita disposable income has grown at 13% CAGR in the last decade to ` 74920 in 2013-14. India has a young
populationwithan average age of24years, leading tohigherdisposable incomes in the hands of those withaspirations for a
better lifestyleandstylish interiors.
Falling interest ratesWith the falling interest rates and falling inflation, RBI may further ease the repo rate. This would lead to higher demand for
thereal estatesector andforthe ceramic tiles industry.
Swachh Bharat mission likely to boost thedemand of ceramic industryThe swachh Bharat campaign launched by Prime Minister Narendra Modi will have a positive impact on the Indian
ceramic industry as the initiative is likely to generate demand for tiles and sanitary ware. The ceramic sector in India saw a
dip in growth last fiscal due to overall economic scenario and lesser than expected investment in construction sector. the
new government at the Centre is focusing on infrastructure sector, which will boost construction and eventually help
ceramic sector.
9
-
8/19/2019 The Money Navigator March 2016
13/36
www.jhaveritrade.com
Opportunities in the ceramic tiles market in India
Buyers are increasingly looking beyond the functionality of ease, hygiene and maintenance and competing foraesthetically appealing tiles in orderto reflect their individualistic lifestyles.
Use of nano technology helps in increasing the shelf lives and strength of tiles by making them resistant to dirt and
bacteria. These tiles are gaining popularity in areas where hygiene is important, such as hospitals, labs and food
processingunits,amongothers.
Usageof eco-friendly tiles is expected to increaseasconsumersbecomemoreenvironment-conscious. Recycled eco-
friendly tilesareusually made from natural andrenewablesubstances.
Constructionof newhousesdrivenby risingincomelevelshave increasedtile usage in theresidential constructionand
thecommercial real estateverticals. Largecompaniesareincreasingly focusing on theretail front,whichwill enablethem toearn highermargins.
Verified tiles,comprising nearly50%of theceramic tilesmarket, have witnesseda robustgrowth in thelast five yearsdue
to their high durability andeasy maintenance.
Preferred stocks Asian Granito India Ltd. (AGL)
AGLhas emerged as one of India’s largest groups, with a global footprint across 50 countries. Its capacity has grown 40 fold
ina spanof just14years,it is India’sfastest growing Ceramic Tile, Vitrified Tile , Marbleand QuartzCompany and among the
world’s 50most profitable Ceramic tile Companies.
AGLhas an extensive marketing and distribution networkwhich comprises of more than 4000 Dealers and Sub-Dealersand
more than 75 ExclusiveDealerShowroomscoveringeach andeverystateof thecountry, this helps thecompany to promote
itsrangeof products to theconsumers.
Kajaria ceramics Ltd.
Kajaria Ceramics is the largest manufacturer of ceramic/vitrified tiles in India. It has an annual aggregate capacity of 68.60
mn.sq.meters, distributed acrossnineplants - Sikandrabad in UttarPradesh, Gailpur & Malootana in Rajasthan, five plants
inGujarat andoneatVijayawada inAndhra Pradesh.
Kajaria's the manufacturing units are equipped with cutting edge modern technology. Intense automation, robotic car application and a zerochancefor human error are few reasons for Kajaria tobethe numberone in the industry.
Ceramic Sector
10
KajariaCeramics 2.00 898.20 33.23 9.63 0.38 33.91 29.11 14.73 180.27
CompanyName
FV (`) CMP* (`) P/E (x) P/BV (x) D/E Ratio
(x) ROCE (%) RONW (%) PBIDTM
(%) CFO (` in Cr.)
AsianGranito 10.00 112.55 17.13 0.88 0.71 8.45 4.71 6.52 104.21
CMP* as on 29/02/2016( Source: Capitaline )
-
8/19/2019 The Money Navigator March 2016
14/36
P
a
y
J
u
s
t
6
2
5
/
G
e
t
Relaxed for Lifetime
P a y J u s t ̀6 2 5/ -
G e t R e l a x e d f o r L i f e t i m e
GetUpto
iscount onDiscount
your Demat A/c
on90%
For More Details Give Missed Call: 08049336177
www.jhaveritrade.com www.jetrade
For Limited Period
-
8/19/2019 The Money Navigator March 2016
15/36
Jamna Auto Industries Ltd.
www.jhaveritrade.com12
“Buy” CMP : ` 133 TGT : ` 181Company Basics
BSE ID
NSE Symbol
Group
EQUITY (` in Cr.)
MKT.CAP(` in Cr.)
520051
JAMNAAUTO
B
39.74
1030.03
Financial Basics
FV ( )
EPS ( ) (TTM)
P/E (x) (TTM)
P/BV (x) (TTM)
BETA
RONW (%)
`
`
5.00
7.41
17.48
5.17
1.3666
11.63%
Investment Rationale
Share Holding Pattern
Holder's Name
Foreign
Institutions
Promoters
Govt. Holding
Public & Others
Non PromoterCorp. Hold.
% Holding
0.522.89
46.45
0.00
50.14
0.00
ROI : 36%
Valuations
JAMNAAUTO is trading at `133. Werecommend “Buy” with target priceof `181,valuing stocks 20xFY18EEPS of `9.07.The stock currentlytradesat 17.60xof FY16E,16.12xof FY17Eand14.66x ofFY18E.
Investment Horizon : 12 to 15 Months
Company OverviewJamna Auto Industries Limited is the largest manufacturer of Tapered Leaf and
Parabolic Springs for Commercial Vehicles (CVs) in India. It has been a trusted and
preferredsupplier ofLeaf andParabolicSpringsto allmajorCVmanufacturers.
JAI is the only Indian company to provide a complete range of automotive suspension
solution forcommercial vehicles. The company hasattained leadership in conventional
spring suspension products in home market and now the company is developing new
technology in suspension system and target new market segments (including the
aftermarket andexports).(Suspension : Suspension is the system that connects a vehicle to its wheels and
allowsrelativemotionbetween thetwo.)
Product PortfolioJAIhas tied up with Ridewell Corporation of USA to manufactureAir Suspension, Bogie
Suspension and Lift Axles in India. Ridewell has more than 42 patents for various
suspensionproductsandis considered a leader in this field.
Multi-Leaf Springs
JAI is the market leader in Multi-leaf Springs with a domestic OEM volume share of 64%. Company is manufacturing a comprehensive range of Multi-leaf Springs ranging
from3Kg to200 Kg.
Parabolic Sprigs
JAI was among the first to introduce Parabolic Springs in India and currently market
leader in themarket. Parabolic technology improves theride comfort, gives much better
vehicle life andcosts less.
Air Suspension
JAI launched its air suspension in FY13 and has begun supplying to leading players like
SMLIsuzu.
LiftAxle
JAIintroducedLiftAxles in FY13 andis already supplying this product toAshokLeyland.
-
8/19/2019 The Money Navigator March 2016
16/36
13
Jamna Auto Industries Ltd.
www.jhaveritrade.com
Investment rational
Commercial Vehicles move towards recovery in FY15Indian CV sales, including exports sales, reduced its decline to 1.3% in FY15, after a steep fall of -18.7% in FY14, with
signs of recovery in the domestic CV segment and strong growth in CV exports to reach 700,743 units as per SIAM.
Domestic CV sales narrowed down it’s de-growth to 2.8% in the year after falling down 20.2% in FY14. Amongst CV sub-
segments Medium & Heavy Commercial Vehicle (M&HCV) showed robust growth while the Light Commercial Vehicle
(LCV) continued to experience slowdown.CV exports reboundedback to positive growth territory reporting 11.3% growth
in FY15. The CV exports have grown at 5-year CAGR of 13.8% generating a healthy 12.2% share of CV production in
FY15. Consistent growthin theauto componentexports is an indication of growing credibility of ‘Indiamade’components.
M&HCV-fastest growing amongst all automotive segmentsTheMedium& Heavy Commercial Vehicle (M&HCV)subsegment, includingexportsales,bounced back to robustgrowth
of 17.4% YoY in FY15 after two years of decline. This was presence of MNC players, the industry will place increased
importance on technologically advanced and value added products.Also, theaftermarket will be an important growth and
profitability driverfor the industry withcustomers’preference forquality branded products.
India is becoming global manufacturing hub continuesIndia is fast becoming a global manufacturing hub for leading OEMs across the world. Major global CV giants such as
Daimler, Man Trucks, Navistar, Volvo, and Hino have entered into Indian market attracted by the low CV penetration and
stronggrowthpotential. GlobalCV majors like Daimler MotorsandScania Motorshave already committed in India.TheseOEMs have a strongfocus towards localizationinitiatives that bodeswell forthe auto componentsector.
C o m p a n y A n a l y s i s
1,000,000
800,000
600,000
400,000
200,000
40.00%
30.00%
20.00%
10.00%
0.00%
-10.00%
-20.00%
-30.00%
FY10 FY11 FY12 FY13 FY14 FY15
582,721 684,905 809,499 793,211 632,851
45,00974,043
92,258 80,027
77,050 85,782
Export CV Sales Domestic CV Sales YoY Growth
614,961
Year FY11 FY12 FY13 FY14 FY15
CV Production 760,735.00 923,136.00 832,649.00 699,035.00 697,083.00
YoY Growth (%) 34% 22.10% -10.40% -16.00% -0.30%
( Source: Company )
( Source: Company )
-
8/19/2019 The Money Navigator March 2016
17/36
Jamna Auto Industries Ltd.
www.jhaveritrade.com14
JAL is a leader in spring manufacturer in India
JAI is one of the world's leading players in automobile suspension solutions and amongst the world's top threemanufacturers of Multileaf springs with a growing presence in Parabolic Springs, Lift Axles and Air Suspensions. The
company is Supplying to Global and Domestic Commercial Vehicle Original Equipment Manufacturers with a successful
track recordof consistentlydelivering best in classquality.
Strong distribution network and marquee clients portfolios
Jamna has built up a strong dealer network, through its subsidiary - Jai Suspension Systems LLP (JSS LLP), all over the
country to support growing domestic After Market demand. The company sells springs under the "JAI" brand in the After
Marketand itsproductscommand premium.
The company is consistently improving aftermarket network to penetrate new markets. JAI has a significant network with
tie-ups with more than 1,310 primary distributors to supply products to more than 5,500 dealers. During the year, revenue
from newmarketsalso increased.
Project Lakshya: Medium term strategy that focuses on valuecreation
The Company aims to achieve a de-risked business model, higher returns and consistent shareholder payouts as a part of
the ‘Lakshya’mission.
Duringtheyear, To achivethis goal, JAL’sexportsalesgrew to reach `10.80 Cr. Realizing thepotential in theexports market,
company is investing in the capacity at Hosur near Banglore, primarily to cater to demand for new generation products and
exports.Thefacility with a capacity of 30,000MTPAis expected tobeoperational byQ1FY17.
Highest market Share among Indian spring manufacturer
Company Jamna Auto Toyo Friends Auto Soni Agya Auto Vikrant Others
Market Share 66% 14% 7% 3% 3% 3% 4%
Domestic Customers International Customers
AMW
Ashok Leyland
Bharat Benz
Force
Kamat Benz
Renault Nissan
SML ISUZU
Tata Motors
VOLVO
VL Commercial Vehicles
GM
ISUZU
UD Trucks
-
-
Operational Goals
Financial Goals
Product De-risking
33% Revenue from New Products
33% ROCE
Diversifying Markets
33% Revenue from New Market
33% Divided Payout
Maximizing Efficiency
33% Break Even Point
Net Block to be funded by net worth
( Source: Company )
( Source: Company )
( Source: Company )
-
8/19/2019 The Money Navigator March 2016
18/36
15
Jamna Auto Industries Ltd.
www.jhaveritrade.com
C o m p a n y A n a l y s i s
Strategically located Plant Close to customer and exports hubs
JAI - Pantnagar
JAI - Yamuna Nagar
JAI - Gwalior
JAI - Jamshedpur
JAI - Pune
JAI - Hosur
JAI - Chennai
JAI - Bhuj
Pant Nagar
TATA Motors | Ashok Leyland
LucknowTATA Motors
Ropar
SML - ISUZU
Alwar
Ashok Leyland
IndoreVECV | Force Motors
MTI
Bhuj
AMW
Pune
TATA Motors
Bangalore
Volve
Ashok Leyland
Kamaz Vectra
Leyland Nissan
Scania
Chennai
Ashok Leyland
Bharat Benz ( Diamler )
Renault Nissan
Ford India
ISUZU
JamshedpurTATA Motors
OEM Plants
JAI Existing Plants
Al l major truck manufacturer uses JAI’s products
Domestic Customers
Exports Customers
( Source: Company & JSL Research )
-
8/19/2019 The Money Navigator March 2016
19/36
Jamna Auto Industries Ltd.
www.jhaveritrade.com16
FY 12
1.10
0.40
0.80
3.51
9.91
9.27
3.853.72
8.49
16.80
15.39
FY 13
1.06
0.27
0.73
2.55
7.88
8.96
3.082.20
8.32
13.66
10.90
FY 14
0.82
0.25
0.76
1.92
7.69
8.31
2.731.03
5.68
6.15
0.47
Debt-Equity Ratio (x)
Current Ratio (x)
Fixed Assets Ratio (x)
Inventory Ratio (x)
Debtors Ratio (x)
Total Asset Turnover Ratio (x)
Interest Cover Ratio (x)PBIDTM (%)
APATM (%)
ROCE (%)
RONW (%)
FY 15
0.50
0.24
0.81
2.51
11.30
14.39
4.113.63
8.14
18.54
11.60
Consolidated Key Financials
FY 12
39.4
152.6
341.23
182.74
363.96
19.27
316.32
297.05
638.28
1204.271119.65
1.97
1128.48
980.51
39.37
102.19
83.37
70.04
51.22
42.19
FY 13
39.5
171
344.1
166.19
463.25
16.25
277.81
261.55
605.66
1055.76980.15
2.34
991.18
858.19
36.39
87.85
61.11
58.9
32.16
27.73
FY 14
39.5
179.86
311.14
125.28
467.06
16.96
250.41
233.45
544.59
893.83833.3
22.27
817.19
775.35
31.27
66.69
42.62
40.78
16.71
13.84
Equity Paid Up
Networth
Capital Employed
Total Debt
Gross Block (Excl. Reval. Res.)
Net Working Capital ( Incl. Def. Tax)
Current Assets ( Incl. Def. Tax)
Current Liabilities and Provisions ( Incl. Def. Tax)
Total Assets/Liabilities (excl Reval & W.off)
Gross SalesNet Sales
Other Income
Value Of Output
Cost of Production
Selling Cost
PBIDT
PBDT
PBIT
PBT
PAT after Minority Interest & P/L Associate Company
FY 15
39.62
196.42
266.03
64.28
478.6
-23.61
208.28
231.9
497.93
1185.221095.01
2.01
1105
993.64
34.71
96.5
78.48
65.4
47.38
29.38
Consolidated Key Financials
Key Financials
Ratio Analysis
( ` in Cr )
-
8/19/2019 The Money Navigator March 2016
20/36
17
Fundamental Stocks
www.jhaveritrade.com
V A L U E B U Y
O
p e n F u n d a m e n t a l C a l l s
Auto Ancil lar ies
Suprajit Engg.
Automobi le
Banks
Capital Goods
Cement
Finance
Infrastructure
Ashok Leyland
M & M
Maruti Suzuki
ICICI Bank
Bank of Baroda
City Union Bank
DCB Bank
Havells India
TD Power Sys.
Inox Wind
Carborundum Uni.
Thermax
J K Cements
UltraTech Cem.
Dewan Hsg. Fin.
Repco Home Fin
PTC India Fin
Larsen & Toubro
Adani Ports
Ashoka Bui ldcon
Company CurrentReco
CMP*( ` )52 Week
High (`) Low (`) 3M
Absolu te Return (%)
6M 12M
FaceValue
MarketCap
P/E Dividend Yield
%
P/BV
(`) (` in Cr) (x) (x)
Jamna Auto Inds Buy
Hold
Hold
Hold
Hold
Buy
Hold
Hold
Hold
Hold
Buy
Buy
Buy
Hold
Hold
Hold
Buy
Hold
Buy
Buy
Buy
Buy
134
137
92
1237
3521
198
139
84
74
281
229
237
165
758
455
2923
150
596
32
1150
206
184
156
152
100
1442
4790
362
216
106
151
322
414
494
200
1318
745
3398
285
785
67
1894
375
221
88
111
64
1091
3386
189
109
78
68
235
225
217
150
716
425
2531
140
555
30
1016
169
143
22%
-4%
-1%
-4%
-24%
-26%
-17%
-4%
-11%
2%
-19%
-36%
-5%
-14%
-30%
6%
-30%
-13%
-22%
-15%
-24%
7%
23%
-7%
-3%
-6%
-23%
-33%
-30%
-13%
-46%
6%
-18%
-39%
-3%
-26%
-31%
-2%
-38%
-21%
-29%
-34%
-44%
0%
22%
1%
35%
-1%
-1%
-40%
-24%
-15%
-34%
4%
-40%
NA!
-11%
-39%
-38%
-3%
-39%
-12%
-46%
-31%
-37%
23%
5
1
1
5
5
2
2
1
10
1
10
10
1
2
10
10
10
10
10
2
2
5
1016
1618
25385
75071
105347
111607
30634
4935
2051
17451
749
5090
3107
8999
3323
77288
4411
3629
1813
105271
42289
3378
5.17
6.72
7.28
2.90
4.33
1.32
0.70
1.83
1.33
9.60
1.52
3.66
2.86
4.19
2.06
4.06
0.95
4.47
1.26
2.57
3.93
1.82
17.25
21.17
28.59
26.21
33.06
9.50
8.13
11.65
10.91
50.07
38.98
14.11
23.44
45.52
26.95
34.80
6.28
25.44
5.06
23.80
16.18
32.64
0.86
0.70
0.50
0.99
0.72
2.60
2.32
1.33
0.00
1.07
1.17
0.00
0.76
0.93
0.84
0.32
1.83
0.26
3.10
1.43
0.54
0.72
-
8/19/2019 The Money Navigator March 2016
21/36
Fundamental Stocks
www.jhaveritrade.com18
V A L U E B U Y
Logistics
Pharmaceuticals
Textiles
Company CurrentReco
CMP*( ` )
52 Week
High (`) Low (`) 3M
Absolu te Return (%)
6M 12M
FaceValue
MarketCap
P/E Dividend Yield
%
P/BV
(`) (` in Cr) (x) (x)
CMP* as on 22/02/2016
Realty
Gateway Dis tr.
Al lcargo Logis tics
VRL Logistic s
Torrent Pharma.
Sun Pharma. Inds.
Granules India
Ahluwal ia Contr.
J Kumar Infra
Garware-Wall Rop
SRF
AYM Syntex
Ambika Cot ton
Nitin Spinners
CARE
Century Ply.
MT Educare
Interglobe Aviat
Radico Khaitan
Bharat Forge
Omkar Spl.Chem.
Sadbhav Engg.
Eveready Inds .
Inox Leisure
Prabhat Dairy
Infinite CompLiberty Shoes
T.V. Today Netw.
Hitech Plast
Torrent Power
H P C L
Miscellaneous
Hold
Hold
Buy
Buy
Hold
Buy
Buy
Hold
Buy
Buy
Buy
Buy
Buy
Hold
Buy
Buy
Buy
Hold
Buy
Hold
Buy
Hold
Buy
Buy
HoldBuy
Hold
Hold
Buy
Hold
209
153
315
1350
882
110
230
297
309
1092
97
778
57
912
148
148
820
102
787
151
230
222
206
94
201147
314
157
223
677
455
218
479
1718
1201
164
303
449
437
1499
163
1149
108
1806
262
200
1395
131
1363
250
385
375
276
169
323310
350
221
247
991
206
128
261
1030
704
75
188
253
166
875
87
518
26
900
136
96
698
79
720
129
206
192
145
90
122125
165
81
137
556
-38%
-22%
-24%
-12%
19%
-27%
-16%
-20%
-13%
-14%
-15%
-11%
-4%
-31%
-17%
12%
-28%
-16%
-9%
-22%
-27%
-21%
-8%
-32%
-7%-27%
17%
39%
19%
-15%
-38%
-2%
-15%
-18%
-6%
-15%
-10%
-23%
-5%
-14%
-29%
-8%
-25%
-26%
-16%
2%
NA
9%
-36%
-23%
-31%
-31%
-14%
NA
6%-36%
40%
48%
28%
-21%
-52%
-8%
NA
21%
-3%
38%
-1%
14%
53%
18%
NA
47%
88%
-44%
-30%
29%
NA
18%
-39%
-7%
-26%
10%
16%
NA
7%-51%
26%
31%
30%
12%
10
2
10
5
1
1
2
5
10
10
10
10
10
10
1
10
10
2
2
10
1
5
10
10
1010
5
10
10
10
2262
3712
2847
22143
209650
2258
1519
2136
660
6195
381
450
244
2673
3267
565
29191
1330
17858
306
3928
1585
1909
887
763239
1875
221
10754
21794
2.45
1.95
6.02
8.89
8.18
4.84
4.51
1.78
2.13
2.73
2.60
1.49
1.46
6.96
8.43
4.49
17.18
1.62
5.19
1.81
2.56
2.54
2.69
1.38
0.971.64
4.17
1.90
1.64
1.60
17.15
14.02
26.78
13.94
47.63
20.97
23.71
21.27
15.74
16.54
8.18
9.35
5.41
35.63
23.45
17.40
14.69
17.26
25.67
9.56
28.03
32.64
31.36
37.99
7.5514.09
23.65
20.76
11.01
16.68
3.36
0.68
1.20
0.86
0.34
0.45
0.00
0.60
0.99
0.93
0.10
1.83
1.88
8.57
1.36
1.87
0.00
0.80
0.98
1.01
0.31
0.00
0.00
0.05
0.001.07
0.48
0.62
0.66
3.81
-
8/19/2019 The Money Navigator March 2016
22/36
19
JSL Top Mutual Fund Picks
www.jhaveritrade.com
Scheme Name
NAV*
(Div)
NAV*
(growth)
1 Year
(%) Since Inc
Axis Focused 25 Fund
BSL MNC Fund
BSL Manufacturing Equity Fund
DSP BR Focus 25 Fund
Franklin India Prima Plus
Birla sun life 95 fund
DSP BR balanced fund
Franklin India balance fundICICI Prudential Balance Advantage fund
L&T India Prudence fund
DSP BR Micro Cap Fund
Franklin India Smaller Co Fund
ICICI Prudential Value Discovery Fund
Kotak Emerging Equity Fund
Mirae Asset Emerging Bluechip Fund
BSL Tax Relief'96 Fund
Religare Invesco Tax plan
Axis long term equ ity fund
IDFC tax advantage
Franklin Indi a Taxshield
Franklin India Dynamic PE Ratio Fund
ICICI Prudential Dynamic Plan
Principal Smart Equity Fund
Religare Invesco Dynamic Equi ty Fund
IDFC Dynamic Equity Fund
HDFC Monthly Income Plan LTP
FT India MIP
IDFC Monthly Income Plan
Reliance Monthl y Income Plan
ICICI Pru MIP-25
Top Equity Diversified Funds
Top Balanced Funds
Mid Cap Funds
Conservative Funds
MIP Funds
Launch
Date
3 Year
(%)
5 Year
(%)
29-Jun-12
27-Dec-99
3-Feb-15
10-Jun-10
29-Sep-94
10-Feb-95
27-May-99
10-Dec-9930-Dec-06
7-Feb-11
14-Jun-07
13-Jan-06
16-Aug-04
30-Mar-07
9-Jul-10
10-Mar-08
29-Dec-06
29-Dec-09
26-Dec-08
10-Apr-99
31-Oct-03
31-Oct-02
16-Dec-10
04-Oct-07
10-Oct-14
26-Dec-03
28-Sep-00
25-Feb-10
12-Jan-04
30-Mar-04
15.05
515.91
8.69
14.78
389.45
504.22
96.99
82.9523.57
17.81
36.10
34.56
97.50
22.57
27.04
19.00
30.17
27.01
32.59
372.06
58.70
158.83
15.48
18.93
10.16
33.33
42.92
16.45
32.81
29.88
-16.67
-8.20
-13.45
-15.86
-11.10
-10.82
-9.11
-7.61-7.09
-7.25
-4.32
-8.62
-15.01
-11.29
-7.21
-12.48
-16.01
-11.97
-16.63
-11.66
-4.35
-17.95
-7.25
-12.89
-6.09
-3.85
-0.57
-0.10
-1.81
-1.43
8.97
27.86
NA
12.08
16.63
13.80
11.98
15.1611.59
16.89
31.71
28.07
20.80
20.90
27.21
18.77
16.08
23.42
14.34
16.28
8.82
11.46
11.46
11.14
NA
8.14
9.68
8.21
9.00
9.58
NA
22.12
NA
8.64
13.79
11.37
9.34
12.3312.27
12.91
21.23
21.49
16.70
17.14
22.41
12.80
13.21
18.82
12.03
13.8
8.51
9.25
10.11
9.82
NA
8.28
9.52
9.48
9.23
9.49
11.82
17.87
-12.40
7.07
18.64
20.47
14.52
13.939.81
12.1
15.89
13.03
21.83
9.56
19.30
8.55
12.81
17.50
17.91
23.88
15.44
23.06
8.77
7.89
1.13
10.39
9.91
8.64
10.29
9.62
Top Saving Funds
NAV* as on 25/02/2016
M u t u a l F u n d P i c k s
13.58
127.79
8.69
11.09
32.41
121.62
20.84
19.7713.92
15.75
21.92
20.23
27.63
17.51
19.22
119.10
15.31
17.66
13.11
35.26
34.49
17.85
14.01
15.94
9.97
NA
NA
NA
NA
NA
-
8/19/2019 The Money Navigator March 2016
23/36
www.jhaveritrade.com20
Selected Macro Economic Indicators
45000
40000
35000
30000
25000
20000
15000
10000
Jan-15 Feb-14 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15
32152
28220
3570435704 32690 33068
3579435794
3220930937
Import & Export (in US $ Million)
2 3 7 7 6
2 1 8 2 6
2 3 8 8 4
2 1 9 9 8
2 1 2 7 4
2 1 2 7 2
2 3 1 4 3
2 1 4 0 8
Oct-15
2 2 2 6 3
2 1 7 2 0
Index of Industrial Production (%)12
10
8
6
4
2
0
-2
-4
3.57
Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15
2.83
4.81
2.483.01
2.51
4.24 4.34
6.26
3.84
-3.2 -1.34
9.81
Total Foreign Exchange Reserves (US $ Billion)
4-Dec-15342.00
344.00
346.00
348.00
350.00
352.00
354.00352.09 352.50
351.1352.04
350.36
348.93
347.20 347.56
349.15
351.48 351.83
350.36
346.78
11-Dec-15 18-Dec-15 25-Dec-15 1-Jan-16 8-Jan-16 15-Jan-16 22-Jan-16 29-Jan-16 5-Feb-16 12-Feb-16 19-Feb-16 26-Feb-16
29796
2 0 0 1 4
Nov-15
33961
2 2 2 9 7
Dec-15
28714
2 1 0 7 5
Jan-16
-
8/19/2019 The Money Navigator March 2016
24/36
21
Selected Macro Economic Indicators
www.jhaveritrade.com
M a c
r o E c o n o m i c I n d i c a t o r s
8
7
6
5
4
3
2
1
6.3
S e p - 1 4
O c t - 1 4
N o v - 1 4
D e c - 1 4
J a n - 1 5
F e b - 1 5
M a r - 1 5
A p r - 1 5
M a y - 1 5
J u n - 1 5
J u l - 1 5
A u g - 1 5
S e p - 1 5
O c t - 1 5
N o v - 1 5
D e c - 1 5
J a n - 1
6
4.98
4.12
5.865.11
5.375.17
5.79 5.74
4.37
6.10
4.35
5.14
6.72
6.326.32
Consumer Price Index (%)
Wholesale Price Index (%)-0.28
-1.28
-1.17 -2.33 -2.43 -2.2 -2.13
-3.79
-4.85-4.54
-3.81
-0.73
-1.99
-0.9
0
-1
-2
-3
-4
-5
-6
Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15
FII (in Billion) DII (in Billion)
200
150
100
500
-50
-100
-150
-200
129 115 121 117 115
-79
17 2
86
-58 -33
120
53
7
-169
-65
10367
-14
-71
85
-28
63
123
-122
Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16
5.9
Jan-
-
8/19/2019 The Money Navigator March 2016
25/36
www.jhaveritrade.com22
JSL Classroom - Gross Domestic Product
What is GDP?
Gross domestic product is the broadest quantitative measure of the nation’s total activity. GDP measures the monetaryvalue of final goods and services—that is, those that are bought by the final user-produced in a country in a given period of
time. GDP is composed of goods and services produced for sale in the market and also includes some non market
production. CalculatingGDPby addingup expenditure iscalledasexpenditureapproach.
GDP=C+I+G+(X-M)
Where,C = personal consumption expenditure
I = gross privateinvestment
G = Government spending
(X—M) = Net exports
Nominal GDPand Real GDP
Real GDP is a measure of the value of economic output adjusted for the price changes (i.e. inflation or deflation). It isAlsoknown as constant dollar GDP. Nominal GDP measures market value of final goods produced in a geographical region,
usually a country.
Why GDP is important ?
GDP enables policymakers and central banks to judge whether the economy is contracting or expanding. GDP helps the
investorstomanagetheir portfoliosby providing them guidance about thestateof theeconomy.
Calculation of GDP provides with the general health of the economy. A negative GDP growth represent bad signals for the
economy. Economists analyze GDPto find outwhether theeconomy is in recession, depression orboom.
What are theimplications of theGDPgrowth rate ?
The GDP growth rate reflects the change in the inflation adjusted GDP from one period to the next and therefore GDP
indicates how fast or slow the economy is growing. If the country is producing more, then additional workers are employed,
more services and manufacturing products are consumed, and potentially more profits are generated for shareholders.
Hence, stock prices have reason to increase.A negative GDP growth rate for two consecutive quarters is one of the factors
used todeterminethat theeconomy is ina recession.
Releasing Time
Government releases theGDP data quarterlywith the
time lagof three months.
(Note : base year changed to2011-12, changefrom GDP
at factorcostto GDP atmarketprice)
(Source : CentralStatisticsOffice)
GDP at Constant Prices (%)
-
8/19/2019 The Money Navigator March 2016
26/36
23
JSL Ideal Portfolio ( Diversified Equity )
www.jhaveritrade.com
Objective of Ideal Portfolio :
Theobjectiveof this portfolio is to generate long term capital appreciationby investing in concentratedportfolioof large capandgrowthoriented midcapcompanies. This will help togeneratemeaningfulwealthforInvestors from EquityMarket.
Stock Selection Methodology : Based on various fundamental parameters andvaluationcheck along with certain themes
likeCyclical,BottomUp,Sector specific,PolicyInitiative/ push , Evergreen.
Key Risks : Macroeconomic / political conditionandsystematic risk,corporateperformance risk
Comparative Portfolio Returns
Particulars Return Since Inception Particulars Return Since Inception
Notes : *CMP as on 22/02/2016., Price ** on recommendation , Return since inception indicates from 1st Jan
Investment Horizon : 9-12 Months
Stock Weights Price** CMP* Target Potential UpsideSuggestions
I d e a l P o r t f o l i o
Maruti Suzuki
KEC International
Bharat Forge
Ultratech Cement
Diwan Housing Finance
Sun Pharma
Inox Wind
Torrent Power
State Bank of India
Axis Bank
VRL Logistics
Torrent Pharma
Ashoka Buidcon
Ahluwal i Contracts
Everday Industries
Automobi le
Capital Goods
Casting and Forgins
Cement
Housing Finance
Pharma
Power
Power
PSU Banks
Public Bank
Logistics
Pharma
Infrastructure
Infrastructure
Consumer Non-Durable
7%
5%
8%
7%
8%
7%
8%
8%
7%
7%
5%
8%
5%
5%
5%
Accumulate
Accumulate
Accumulate
Buy
Buy
Accumulate
Buy
Buy
Accumulate
Accumulate
Buy
Buy
Buy
Buy
Accumulate
4550
136
868
2835
252
831
388
185
228
454
381
1555
161
235
209
3520
102
786
2923
150
882
236
223
164
397
314
223
183
229
214
5200
180
1200
3400
368
1041
488
234
325
620
457
1840
205
368
287
48%
76%
53%
16%
145%
18%
107%
5%
98%
56%
46%
725%
12%
61%
34%
Ideal Portfolio Return
Value Buy (100%)
CNX Small Cap
-14.70%
-22%
-20.98%
Nifty
Sensex
CNX Mid Cap
-9%
-9.07%
-12.15%
WeightsSector
-
8/19/2019 The Money Navigator March 2016
27/36
JSL Ideal Portfolio ( Small Cap )
www.jhaveritrade.com24
Objective of Ideal Portfolio :
The aim is to generate long term capital appreciation from a portfolio that is not part of the leading stocks by marketcapitalization. Theaimis to include and invests in companies that have immense growthpotentialas they areoperatingon
a smallerbase.
Stock Selection Methodology : Based on various valuation parameters and finding out early stage companies based on
sound business model andavailableat cheap valuation
Key Risks : Small-cap stocks are not tracked closely by market/ equity analysts and that is why the real value of good
small-cap stocks can remain undiscovered for long. This makes investing in them risky. The risk associated with large cap
funds also associated with small cap( see last page).Small companiesarerelatively weak in termsof governance, dividend
policies andprofessionalismof theboard.Thismakes them risky.
Stock Sector Weights CMP* Target Potential Upside
Diversified Equity Portfolio Allocation
Power
Pharmaceuticals
Banks
Infrastructure
Casting and Forgings
Housing Finance
Automobi leCement
Capital Goods
Consumer Non-Durable
Logistics
16%
15%
14%
10%
8%
8%
7%7%
5%
5%
5%
Small Cap Portfolio Allocation
Textile
Computer - Hardware
Education
Food Processing
Pharmaceuticals
Printing and Stationery
Retail
Tyre
30%
10%
10%
10%
10%
10%
10%
10%
Notes : *CMP as on 22/02/2016.
Investment Horizon : 18 - 24 Months
Suggestions
AYM Syntex
Good Year
KPR Mills
KRBL
Garwale Wall Ropes
Smartlink Network
MPS
MT Educare
Shaily Engineering Plastics
Amb ika Cotton Mil ls Ltd.
Textile
Tyre
Textile
Food Processing
Textile
IT- Hardware
Printing
Education
Capital Goods
Textile
10%
10%
10%
10%
10%
10%
10%
10%
10%
10%
97
477
653
188
308
87
630
148
513
778
223
868
1120
360
550
156
1150
220
890
1149
129%
82%
72%
91%
79%
79%
83%
49%
73%
48%
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
Accumulate
-
8/19/2019 The Money Navigator March 2016
28/36
25
Monthly Technical Picks - Equity
www.jhaveritrade.com
M
o n t h l y T e c h n i c a l P i c k s SBI APOLLOHOSP
We have detected positional buying in Supertrend on SBI in dailycharts. The stock has been beaten down badly and now after twoweeks of consolidation it has risen with volumes. The past 2 weeksvolume is higher than average weekly volume of stock. All other momentum indicators like directional moving index are suggestingpossible up move in stock. Any decline should be used to buy thestock.
IBULHSGFIN
We have detected that stock is in lower top & lower bottom formationfrom previous few weeks. HDFC has made a low of 1011 and hastechnically bounced back and came back to touch its 200 EMAaround1180 levelsin Daily charts. This rise in stock shouldbe used tosell.
We have detected a "Top Triangle" chart pattern formed on IndiabullsHousing Finance. The price seems to have reached a top, showingsigns of reversal as it have broken downward after a period of consolidation. A Top Triangle shows two converging trend lines asprices reach lower highs and higher lows. Volume diminishes as theprice swings back and forth between an increasingly narrow rangesreflecting uncertainty in the market direction. Then well before thetriangle reaches its apex, thepricebreaksdown below the lower trendline with a noticeable increase in volume, confirming this bearishpattern asa reversalof theprioruptrend.
We have detected an ascending continuation triangle chart patternformedonApollohospitalcharts. It’s a bullish signalwithgood volume.The increasingly higher highs within this pattern tells us that buyersare more aggressive than sellers, confirmed by a breakout through aresistancelevel withpositivedirectionalmoving indexcrossover.
BUY BTWN 175-180 TGT 215 SL 158
SELL BTWN 650-670 TGT 570-550 SL 710
BUY BTWN 1480-1500 TGT 1640 SL 1400
HDFC
SELL BTWN 1160-1180 TGT 1100 SL 1200
-
8/19/2019 The Money Navigator March 2016
29/36
Monthly Technical Picks - Currency
www.jhaveritrade.com26
GBP INR USD INR
The IMF has predicted strong growth from India over the next twofiscal years, boosting INR and weakening GBP in long term. After aconfident Indian 2016 Budget, with the Rupee (INR) strengtheningagainst the British Pound (GBP). Although the initial flurry of ‘Brexit’debate has subsided the pound to rupee (GBP/INR) exchange ratehas remained on a softer footing so far this week, in spite of somestronger UK data. The GBP INR pair will be range bound with strongsupport at91.50and strongresistanceat 105levels.
EUR INR
JapaneseYenis expected to tradesideways in short term as optimismseen in the Asian markets will further act as a negative factor for theJapanese Yen as investorspreferto place risky bets. For a medium tolong term horizon, we suggest buy on declines in pair as it has hugesupport at 56.90 levels which is 100 EMA.The upside target remainsat 62-64levels.
The pair is in monthly consolidation as Average directional movingindex (ADX) is below 20 on monthly charts. Long term trend linesupport is at 73.10 levels for month of March. We expect pair to movein range and have support at 73.10 on downside and resistance at 78on upside.
Improved oil and commodity prices and pick-up in US economic datahas changed the sentiment to risk-on. Dollar has weakened againstcommodity currencies and the Rupee has gained against Dollar onbuoyant equity markets following the Union Budget. OMO buybackandexpectationsof mid-term policyratecutby RBIhas changed bondmarket sentiment to positive. Weexpect the USD-INR to in a range of Rs 64.20-69.20
JPY INR
-
8/19/2019 The Money Navigator March 2016
30/36
27
Monthly Technical Outlook - Index
www.jhaveritrade.com
M o n
t h l y T e c h n i c a l O u t l o o k
Nifty
The index opened at 7589, made a high of 7600, made a low of 6825 and closed the month at 6987. Last month we hadclearly mentioned that Nifty is in medium downtrend and is taking supports at long term trend line at 7550. We had also
clearly mentioned that once thetrend line is broken, Nifty will find monthly cluster support at 6700-7200. Nifty touched lowof
6825 in January. Directional moving index has already given negative crossover which confirms the downtrend. Nifty will
give some technical bounce back as it’s oversold and retracement can be seen up to 7200-7350-7420-7480 levels.
Downside support is at 6850-6700 levels. Positive trend will only began if nifty manages to close above 7550 on weekly
basis.
Bank Nifty
The index opened at 15547, made a high of 15565, made a low of 13407 and closed the month at 13946.Last month wehadclearly mentioned that Banknifty is in medium term downtrend. Earlier monthly support was 16100 levels where Banknifty
was continuously taking support from past 4 months. It had broken that support and we had mentioned last month
momentum of sell will rise on break of 15760 levels. Banknifty made lowof 13760 in February. Next Monthly cluster support
comes at 13200-12000 levels. We advise to buy on declines with huge support at 13200 levels for targets of 14500-15100-
15500levels.
-
8/19/2019 The Money Navigator March 2016
31/36
Monthly Technical Outlook - Commodity
www.jhaveritrade.com28
Bullion
Energy
Last week bullion prices ended with losses where gold prices dropped by over half percent losses and silver prices droppedby more than 3% slipped as the dollar and global shares rose, but fund buying persisted as investors expected a G20summit would produce little in the way of a coordinated stimulus program. Prices have largely remained in consolidationafter stretching into a high at 1263 earlier in the month. U.S. Commerce Department report showed that the economyexpanded at a 1% rate in the fourth quarter, up from an estimate of 0.7% growth last month. Concerns that a slowing globaleconomy could eventually push the United States into recessioneased as data showed U.S. economic growth slowed lessthan expected in the fourth quarter. Financial leaders from G20 nations gathered in Shanghai against a backdrop of worseningeconomic conditions and a lack of wider consensus on how to fix the problems. Worries about the strength of theU.S. economy, andthepace of further rate increasesby theU.S. Federal Reserve, continue toprovide support forthe metal.Since the start of the year, tumbling Chinesestock markets havealso stoked demand for gold, as fears about the strengthoftheworld’s second-largest economy fueledhaven buying. But those fears have cooledas economic data andmarkets therehave stabilized in recent weeks. Gold demand in Asia remained subdued this week as buyers were sceptical about thesustainability of therecentprice rally, with theIndianmarket fallingto recorddiscounts as consumerspostponedpurchasesin ex pectation of a cut in the import tax. Asian buyers have curbed purchases since mid-January as spot gold prices have
spiked to a one-year high amid a tumble in global stocks that stoked demand for the safe-haven metal. A stronger-than-expected revision toU.S. 4QGDP anda pickupin thePersonal Consumption Expenditure (PCE), theFed’spreferredgaugeof inflation, fueled strength in the greenback as market participants repriced expectations for higher rates from the centralbank. Fed fund futures inched up on the back of the release, pricing a 30% chance of a 25basis pointhike at the June policymeeting. Looking ahead to next week, traders will be closely eyeing U.S. pending home sales, ISM data and the all-important February Non-Farm Payrolls report. With this week’s uptick in PCE, a stronger print on the employment reportcould further bring-in interest rate expectations as thecentral bank looks to achieve its dual mandate of fostering maximumemployment & pricestability (i.e. 2% inflation).
Recommendation
BUYGOLD@ 29200 SL 28980 TGT 29800-30200.BUYSILVER ONDROP@35500 SL 34700 TGT 36500-37800
Last week, crude oil prices ended with over 5% gains driven by disruptions to crude supplies and Wall Street's gains from
U.S. economic data. In international market prices turned negative soon after the release of weekly U.S. oil rig data byindustry firm Baker Hughes that showed a 10th weekly drop in the rig count. The data was positive to oil, but traders andinvestors chose to lock in profits. Oil was up from the start of the week after data showing a slide in shale crude output andstrong gasoline demand in the United States. Also bolstering prices was a meeting scheduled for mid-March by at least fourmajor oil producers, including SaudiArabia, to discuss a production freezeat January'shighs.On Friday, themarket initiallysurgedonnewsthat pipeline outages in Iraqand Nigeria will removemore than800,000 barrels of crude per day fromglobalsupply for at least two weeks. The disruptions should offset recent increases to supply from Iran. Investors on Fridaycontinued to react to comments from EulogioDelPino, a dayafter theVenezuelanoilminister reiterated that OPEC will hosta meeting nextmonth todiscuss a potential production freezeamong a group of major exporters.The summit, Del Pino, toldbroadcast network Telesur, will include 10 nations, including Saudi Arabia, Russia and Qatar. The aforementioned trio, aswell as Venezuela, agreed in principle to an agreement last week, in which the four nations have pledged to limit their production this year to levels reached in January. While natural gaspricesended with over 6%lossesas concerns about theheavily oversupplied market continued to keep pressure on prices. Warmer-than-average temperatures have cut demand
for natural gas as an indoor-heating fuel, forcing producers to keep more gas in storage. Natural-gas inventories fell by 117billion cubic feet of natural gas in the week ended Feb. 19, the Energy InformationAdministration said Thursday, less thanthe 138-bcf decline expected. Stockpiles as of Feb. 19 stood 29% above the five-year average for this timeof year. Weatherforecasts for the next two weeks continue to call for moderate heatingdemand. Market participants have long expected thestartof U.S. natural-gas exports toboost themarket, as thedomesticglutcouldbeabsorbedbyoverseas demand. Buta glutof natural gasaround theworld haspusheddown international pricesand made U.S. liquefied natural gas less competitive.Meanwhile,updatedweather forecastscalledformild weather in theU.S. northeast through thefirst week of March.
Recommendation
BUYCRUDEOIL @2150SL 2000TGT 2280-2400.SELL NAT.GAS @125 SL 132 TGT 116-108
-
8/19/2019 The Money Navigator March 2016
32/36
www.jhaveritrade.com
F i n a n c i a l P l a n n i n g
Plan your Investments
Welove knowing what is cookingat our neighbour’splace. Some might even point out and say we are more interested what
is happening next door than in our lives. Some of us are also forced to become engineers because Sharma Ji ka beta is anengineer. Nobody asked if Sharma Ji ka beta if he wanted to be an engineer and nobody asked you either. Hate it or love it,
you dealt with four years of it. You lived someone else’s plans and with every passing year you realized maybe you could
have some thingsdifferently.A plan tailormade foryou, tosuit your needsandpassions.
That is the drawback of going along with someone else’s plans. It simply is not designed to cater you our needs. Nobody
understands your needs better than you! Your investment plans are connected to your current income, your financial or life
goals and your personal circumstances. Your age and the conditions around you determine how you will go forward with
your investments.How doyoucreateyour ownfinancialplan?
Assessing Your Current Situation
Current Age & Your Investment Options
Age is one of the determinants of your investments.Young investors invest differently from middle aged or old investors. The
former goes for high risk instruments because of the long investment period ahead of them. Aged or middle aged investors
have to keep incline towards moderate to less risky investment products due to the gradual shortening of their investment
horizon.
Current Financial Situation
Another factor that determines your investments are your current income. Your current income and expenses determine
how much you will be able to save and invest. It is imperative that the transition from savings to investments has to happen
otherwise the money remains stagnant and deprived of its potential. Young investors who have just started earning may
investsmall amounts compared toexperienced investorswhohas been working and investing fora longerperiodof time.
Risk profile
This determines the amount of risk you wish to take on your investments. A young investor could be wary of risk while an
experienced investormaytake high calculated risk. Calculated risk inequities often lead tohigherreturns. However, it poses
the threat of loss as well. This may push some investors to take risk and some prefer not to. Risk profiling allows you to
understand the kind of investor you are and the extent to which you allow your exposure to equity investments to generate
desired andsuperior returns.
Inclining Investments to Your Goals
Start Investments for Goals
Blindly investing will not reap you any benefits because there is no motivation or intrinsic factor to keep investing. If your
goals are aligned to the ongoing investments, it provides a sense of direction. For example, you have been investing in an
Equity Linked Savings Scheme or ELSS fund and suddenly because of a salary hike your taxes have also increased. The
goalofan ELSSfundis tosaveon taxes and an increased investment in the ongoing fundfulfilsthegoalof tax saving.
29
-
8/19/2019 The Money Navigator March 2016
33/36
www.jhaveritrade.com
Hence,you alignedyour investmentswith your personal goal.
Timeline for Goals
The “why” of an investment determines the reason for your investment. Most of the reasons orgoalsare timebound and the
valueof investment is only to the extent it enables you to fulfill your goals. Intermediate goals are ten to twelve years usually
for child education where once the feeshavebeenpaidyou neednot keep investing for the same
goal. Some goals are long term andlifelong, likeretirement goals.You have to keep investing foryour retirement to maintain
the same standard of living and cover medical expenses. Hence, the time of investment determines the amount you will
needtoput inevery month orall atonce.
Emergency & Liquid Funds
Time and emergency waits for none. It is only wise to be prepared for any kind of emergency that may befall you or your
family members, if youare theonly bread earner. Investorsoften make short term investments in MutualFund Liquid Funds
foremergency fundsandstay invested rather than letting thesum stagnant in a bank account.
Apart f rom emergency requi rements, you may also decide on the ratio of liquid assets to investments. For example - If
you wanta partof yourinvestments tobe liquidthenyoucannotinvestin ELSSFunds as ithas a lock inperiodof three years.
Creating & Monitoring Your PlansDeciding upon Diversification
Allocating your assets further within an asset class is called diversification. Diversification is done to regulate risk in a
portfolio.Yourinvestmentswill be in moderaterisk equityoptions likeBalancedFunds,Diversified Fundsand if youarea low
risk takeryouwill invest inLargeCapMutualFunds.
Consulting a FinancialAdvisor
You may not understand the process of investment as well as you would like to. It does require a certain amount of time and
effort which you may not have or do not want to give. This may result in lack of information or misinformation both of which
could be fatal to your investments. A financial advisor is supposed to give you neutral investment advice based on your
investment needs and income. Having a financial advisor makes the task of investing much easier and hassle free. Some
advisors may chargefor services thatheorshe isofferingbut it isa smallprice topay for the convenience you are availing.
TimeFramefor Reviewing
Kick starting theprocess of investing is an immenselysatisfying one. However, youhave to take some personal interest in to
this process. However, a quickglance once in six months or annually will assure you that your investments are still in track.
Youalso have tomake some more investmentsorwatch theaverage performers.Thus, seta time periodwithinwhichyou
will monitor your portfolioandkeep boostingyour investments.
Deciding upon Your AssetAllocation
There arevarious classes of assetsanddeciding upon theratio of investments in thoseasset classes your futurereturns are
determined in thelong run. Investingin a mixedsetof asset classes isa risk regulating factorfor your investments.Yourage
Plan your Investments
30
-
8/19/2019 The Money Navigator March 2016
34/36
www.jhaveritrade.com
F i n a n c i a l P l a n n i n g
Plan your Investments
andthedegreeof risk youwish to take determineyour asset allocation.
The table above shows the various asset allocation possibilities depending on the age and risk profile. One can also see
how different the asset allocation for a 20yearoldis comparedto the asset allocation ofa 45yearold investor.
ConclusionInvestment is an individualistic activity that needs tobe carried out in a manner that isbest suitable for you.You cannot allow
the noise of other investors to determine your investments. A financial plan needs to be made depending on who you are
professionally, how much you earn and what are your future goals and if all your investments have been done with that
objective. If you wish to get some guidance getting professional advice is the wise way to go. Your plans determine your
investments.
31
Life Stage Investment Mantra InvestmentHorizon
Asset Al locat ions
Equity Funds Debt Funds Cash
Risk
21-30 years
Young
Investor
Aggressive Investment
Low Surplus > 15 Years
85%
75%
65%
75%
65%
55%
65%
55%
45%
55%
45%
35%
40%
30%
20%
10
20%
30%
20%
30%
40%
30%
40%
50%
35%
45%
55%
45%
50%
55%
% 5
5%
5%
5%
5%
5%
5%
5%
5%
10%
10%
10%
15%
20%
25%
% H
M
C
H
M
C
H
M
C
H
M
C
H
M
C
31- 40 years
ModeratelyYoung
Investor
41- 50 years
Matured
Investors
51- 60 years
Seasoned
Investors
60 onwards
Retired
In