UTI Market Outlook Report...Fiscal Deficit: India’s fiscal deficit for Apr-Jul 2018 came in at Rs. 5.40 lakh crore, or 86.5% of the budgeted target for FY19 against 92.4% a year

UTI Market Outlook Report

October 2018

Market Outlook Flow

Macro Economic View

Fixed Income Outlook

Equity Outlook

IMF projects 2018 global growth at 3.7% (20 bps lower than

Apr projection)

United States growth projection retained at 2.9% while 2019

growth reduced by 20bps

India’s GDP projection lowered by 10bps to 7.4% for 2019

IMF 2019 world GDP growth at 3.7% (20 bps lower)

− Among EMEs, growth prospects factor in trade wars, tighterfinancial conditions, geopolitical tensions, higher oil importbills

− Slower expansion in working-age populations andprojected lackluster productivity gains to imply lowermedium-term growth rates in advanced economies

Global Macros Growth: Cyclical upswing, structural change

Source: The International Monetary Fund, based on latest IMFdata available till September 30, 2018

IMF Growth Projections

3

3.7 3.7 3.7

2.4 2.42.1

6.5 6.5 6.3

0

1

2

3

4

5

6

7

2017 2018 2019

World output Advanced economies Emerging & developing Asia

Key Policy Rates:Rates inching up major economies

US FOMC hiked the funds target rate by 25 bps to 2.25% in Sep’18 policy. The FOMC pegs 1 more hike in 2018

Bank of Japan held its monetary policy steady as inflation is still far from targeted 2%. Deposit rate was retained at

-0.1%. BoJ announced more flexibility in its bond purchases, allowing a wider band for yield curve control policy

ECB’s monthly purchase under asset purchase program to continue at €30bn at least till Sep’18, lower to €15bn till

Dec’18 and stop thereafter

Bank of England held the policy rate at 0.75%. BoE held government bond purchases at £435bn and corporate

bond purchases at up to £10bn

Source: Bloomberg based on data available till Sep 30, 2018

4

Rat

es

(%)

-0.5

0

0.5

1

1.5

2

2.5

3

Jan

-09

May

-09

Sep

-09

Jan

-10

May

-10

Sep

-10

Jan

-11

May

-11

Sep

-11

Jan

-12

May

-12

Sep

-12

Jan

-13

May

-13

Sep

-13

Jan

-14

May

-14

Sep

-14

Jan

-15

May

-15

Sep

-15

Jan

-16

May

-16

Sep

-16

Jan

-17

May

-17

Sep

-17

Jan

-18

May

-18

Sep

-18

US UK ECB Canada Japan

-4

0

4

8

12

16J

un-1

2

Se

p-1

2

De

c-1

2

Ma

r-1

3

Ju

n-1

3

Se

p-1

3

De

c-1

3

Ma

r-1

4

Ju

n-1

4

Se

p-1

4

De

c-1

4

Ma

r-1

5

Ju

n-1

5

Se

p-1

5

De

c-1

5

Ma

r-1

6

Ju

n-1

6

Se

p-1

6

De

c-1

6

Ma

r-1

7

Ju

n-1

7

Se

p-1

7

De

c-1

7

Ma

r-1

8

Ju

n-1

8

GDP Agriculture Industry Services

Domestic Macro Growth:

Growth picks up, IIP steady

Growth: Demon & GST disruptions behind us

Q1FY19 growth reflects recuperation from the two economic shocks, viz. demonetization & GSTimplementation. Q1FY19 GVA at 8% and GDP at 8.2%

Nominal GDP (13.8%) indicated positive deflators, higher consumption and uptick in investments;however on the back of a wider net exports deficit

Government efforts towards capital spending, addressing supply side bottle necks, faster projectclearances, ease of doing business, various other institutional and operational reforms remainimperative

Jul IIP at 6.65% against 7% in Jun, owing to weak base

IIP growth (% yoy)

Source: CSO based on data available till Sep 30, 2018

Real GDP (activity wise)

Source: CSO based on data available till Sep 30, 2018

5

%%

Inflation:Lower due to base effect and moderation of food prices

Inflation: Headline to remain elevated

Aug CPI Inflation @ 3.7% came in lower than 4.2% in Jul; Core CPI came in lower at 5.9% v/s 6.3% in Jul

WPI for Aug at 4.5% vs 5.1% in Jul

CPI trajectory likely to trend higher in Q4FY19

Source: MOSPI, UTI MF, Office of Economic Advisor based on data available till Sep 30, 2018

6

CPI and Core CPI inflation (% YoY)

Source: MOSPI, UTI MF, Office of Economic Advisor based on data available till Sep 30, 2018

Inflation rates within RBI’s target trajectory

-2

0

2

4

6

8

10

Fe

b-1

6

Ma

r-1

6

Ap

r-16

Ma

y-1

6

Jun

-16

Jul-1

6

Au

g-1

6

Se

p-1

6

Oct-

16

Nov-1

6

Dec-1

6

Jan

-17

Fe

b-1

7

Ma

r-1

7

Ap

r-17

Ma

y-1

7

Jun

-17

Jul-1

7

Au

g-1

7

Se

p-1

7

Oct-

17

Nov-1

7

Dec-1

7

Jan

-18

Fe

b-1

8

Ma

r-1

8

Ap

r-18

Ma

y-1

8

Jun

-18

Jul-1

8

Au

g-1

8

(%)

YoY

Fuel Food

Fiscal Deficit:

India’s fiscal deficit for Apr-Jul 2018 came in at Rs. 5.40

lakh crore, or 86.5% of the budgeted target for FY19

against 92.4% a year earlier.

Some comfort

― Constrained expenditure trend

― Prudent expenditure mix – higher capital spending

Some concerns

― Lower run rate of direct tax collections and non tax

revenue

― Dismal disinvestment

― Higher MSP to add to fiscal costs

Twin Deficits:Fiscal & Current Account

YTDFY19

(Rs Bn)

% of

FY19BE

YTDFY18

(Rs Bn)

% of

FY18

Revenue Receipt 3,357 19.5 2,910 19.3

Tax (net) 2,926 19.8 2,579 20.3

Non tax 431 17.6 331 14.0

Capital Receipt 137 14.9 125 10.6

Recovery of loans 45 37.0 42 23.9

Others 92 11.5 83 8.3

Total Receipt 3,495 19.2 3,035 18.7

Total Expenditure 8,897 36.4 8,084 36.5

T-Revenue 7,784 36.3 7,133 36.7

T-Capital 1,113 37.1 951 34.9

Fiscal Surplus/(Deficit) (5,403) 86.5 (5,049) 84.9

Source: CGA based on data available till September 30, 2018

7

(60)

(40)

(20)

-

20

40

Q1

FY

10

Q3

FY

10

Q1

FY

11

Q3

FY

11

Q1

FY

12

Q3

FY

12

Q1

FY

13

Q3

FY

13

Q1

FY

14

Q3

FY

14

Q1

FY

15

Q3

FY

15

Q1

FY

16

Q3

FY

16

Q1

FY

17

Q3

FY

17

Q1

FY

18

Q3

FY

18

Q1

FY

19

Invisibles Trade balance Current account

USD bn

Current Account Deficit: External balances to

deteriorate in FY19

Twin Deficits:Fiscal & Current Account

Current Account

Q1FY19 CAD at 2.4% of GDP vs 1.9% in Q4FY18.

FX reserves dip by USD 11.3 bn in Q1FY19

FY19 CAD to widen; overall external balances havemade INR weaker in FY19

India’s trade deficit narrowed in August to $17.39billion from $18.02 billion in July’18 on back of risingexports

USD

Bn

Trade Balance (USD Bn)

USD

Bn

Source: Bloomberg based on data available till Sep 30, 2018

Source: GoI based on data available till Sep 30, 2018

8

Domestic Macro Drivers:Favorable trajectory

Key Factors Where is it placed currently? Outlook

GVA Growth Cyclical growth recovery

Inflation Headed Northwards

Fiscal deficit Tight Walk

Rates/RBI Policy Stable & focused

Current Account to GDP

Nearing threshold levels

Indian Economy has achieved significant progress in its macro,which will support the growth for many years to come

GVA Growth (%)

6.6

3.9 10.3

Low High

Inflation (%)

5

1.9 11.4

Low High

Fiscal Deficit (%)

3.5

2.5 6.5

Low High

Current Account to GDP (%)

1.9

-4.8 2.4Low High

Repo Rate (%)

6.5

4.5 9.0

Low High

Macro-economic variables data from 2002-2017. Source: MOSPI, MOSL, Bloomberg Current data as of: GVA, CA to GDP, Fiscal deficit are for FY18, Inflation as on Jun’18 & Repo Rate – Aug’18

%

9

2018-19: Macro vulnerabilities amidst recovery

Growth recovery shaping up post demonetization and GST implementation

― FY19 growth numbers on an uptrend (GDP pegged at 7.3%)

Inflation: Rising price pressures ahead

― FY19 to mark average inflation of ~4.5%

Fiscal consolidation difficult ahead of an election year

― Center’s slippage evident: revised FD/GDP target of 3.5% for FY18 and 3.3% for FY19

― State finances comforted by share of GST from Centre

Current account deficit expected above 2.8% of GDP

― Higher import bill and capital flow vulnerability add headwinds to CAD comfort

Reforms implementation to augur well for medium term macro :

― Bankruptcy code, GST passed; supply-side reforms imperative

Long term drivers intact:

― Targeting lower inflation, increasing disposable incomes and rise of the middle class generate demandpotential

― India’s relative attractiveness in the EME basket

― Diversified trade destinations to Asia & the Middle East leading to less trade dependence on developedworld

11

Fixed Income Outlook

Indian 10 Year G-Sec:

Yields trending up again

Source: Bloomberg & RBI12

The 10 year benchmark G-Sec, the 7.17% 2028 GS yields closed at 8.03% on last day of Sep’18

Factors impacting yields:

Negative factors

― Rising US treasury yields

― Volatile crude oil prices

― Strengthening USD leading to depreciation in INR

― Default of an NBFC

6.0

6.5

7.0

7.5

8.0

8.5

5.8

6.3

6.8

7.3

7.8

8.3

Jan-15 Apr-15 Aug-15 Dec-15 Mar-16 Jul-16 Nov-16 Mar-17 Jun-17 Oct-17 Feb-18 May-18 Sep-18

10

Yr G

sec (%

)

Re

po

(%

)

Repo Rate (LHS) 10 year G-sec Yield (RHS)

Positive factors

― OMO announcement by government

― Reduction in government’s borrowing calendar

Yield Curve Yields have moved higher across shorter end of the curve over the last few months

13 Source: CCIL

• The above graph shows the movement of yields across different maturities

• Short term as well as long term yields have moved up in month of Sep’18 from Jul’18

5.80

6.10

6.40

6.70

7.00

7.30

7.60

7.90

8.20

8.50

8.80

0 1 2 3 4 5 6 7 8 9 10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

39

40

Ze

ro C

ou

po

n R

ate

(%

)

Tenor (In Yrs)

Movement of Zero Coupon Yields

31/Jul/18 28/Sep/18

14

Domestic Debt Market IndicatorsSoftening seen in the month gone by

Source: Bloomberg, Data as on last day of the above mentioned months

7.2

8.4

8.9

7.3

8.48.8

7.7

8.79.1

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

Tbill AAA AA

1 Year Rates (%)

Jul-18 Aug-18 Sep-18

7.9

8.7

9.1

8.0

8.7

9.2

8.1

8.9

9.4

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

10.00

G-sec AAA AA

5 Year Rates (%)


7.7

8.5

9.0

7.8

8.6

9.1

8.0

8.7

9.2

7.00

7.50

8.00

8.50

9.00

9.50

G-sec AAA AA

3 Year Rates (%)


7.8

8.7

9.2

8.0

8.8

9.3

8.0

8.9

9.4

6.00

6.50

7.00

7.50

8.00

8.50

9.00

9.50

10.00

G-sec AAA AA

10 Year Rates (%)


YTD Data till Sep 2018Data Source: ICRA MFI Explorer

BnUSD

Calendar Year

15

Fund Flows:FPI/ FII Inflow and Debt MF Inflow trend

2.4 1.4

10.4 7.9 6.4

-8.2

25.0

6.7

-6.2

23.3

-6.6

10.2

42.4 43.6

55.0

82.876.5

98.5

65.5

46.6

59.5

25.3

-20

0

20

40

60

80

100

120

FII/FPI flows Debt MF flows

RBI’s 4th Bi-monthly Monetary Policy 2018-19

Key Takeaways

To the surprise of market participants,

RBI holds repo rates at 6.50%

Kept the policy Repo Rate under the Liquidity Adjustment Facility (LAF) unchanged

at 6.5%

Consequently, the reverse repo rate under the LAF stands at 6.25%, and the

marginal standing facility(MSF) rate and the Bank Rate at 6.75%.

Key Rates (%) Oct 5, 2018 Oct 4, 2018

Repo No change 6.50

Reverse Repo No change 6.25

Cash Reserve Ratio (CRR) No change No change

Statutory Liquidity Ratio (SLR) No change No change

Marginal Standing Facility (MSF) No change 6.75

Bank Rate No change 6.75

10-Year G-Sec 8.02 8.16

Source: Bloomberg

CPI INFLATION

CPI projection to 3.9-4.5% in H2FY19 (from

4.8% in Aug policy) & 4.8% in Q1FY20 from

5% projected in Aug

Inflation projections factor in:• Recent softening in food prices• Excise duty cut• Volatile crude oil prices• MSP Implementation• INR Depreciation• Possibility of fiscal slippage• Global market uncertainties

GROWTH

FY19 GDP projection retained at 7.4% and reduced 10

bps to 7.4% for Q1FY20

Positives:

• Strong private consumption

• Improved capacity utilization

• Large FDI inflows

• Increased financing resources for the corporate sector

Downside risks:

• Tight global and domestic financial conditions

• Higher input costs implying lower margins and

discouraging investments

• Slowdown in global trade amidst escalating tariff wars

16

We continue to believe that the underlying theme will be to focus on capital preservation and

reasonable income accrual based on the evolving domestic & global macroeconomic environment

In such a scenario, funds having a combination of higher income accrual and short to medium term

duration would provide a good investment opportunity for the investors

Fixed Income:Current Market Outlook

17

Bond yields continued with their rising trend surging to its highest level in nearly four years following increase inglobal crude oil prices. Market sentiment was dampened after the rupee plunged to a record low against thegreenback

However, losses began to reversed due to certain factors viz. news that PM may review the nation’s economicsituation, RBI’s OMO announcement and reduction in government’s borrowing calendar

However, the INR bore the brunt of the policy by falling to below Rs. 74 to the USD for the first time on record brieflyafter the policy announcement. . By day end currency recovered from the record low and closed at Rs. 73.76 tothe dollar.

The 4th bi-monthly policy by RBI came as a surprise for market participants when the repo rate was unchanged andthe stance was changed to calibrated tightening. Bond markets reacted positively with yields dropping by 14 bpsand closing at 8.02%

We expect the 10 year benchmark 7.17% GS 2028 yields to be in range of 7.80% to 8.15% levels over the near term.We continue to expect two more rate hikes by RBI though timing of them is uncertain. Going forward marketswould closely watch RBI’s intervention in the forex market, liquidity measures, tackling of the IL&FS situation and

global cues ranging from crude oil to movement in US treasuries for further direction

Equity Outlook

Data Source : Bloomberg

YoY

%gr

ow

th

Timeline

There is significant headroom for credit growth

Bank Credit Growth:Slight improving trend

19

13.5%

0

5

10

15

20

25

30

35

40

Commercial Credit Growth

Data Source : MOSL LPA: Long Period Average

S&

P B

SE S

en

sex E

BIT

DA

ma

rgin

s in

%

EBITDA Margin expansion driven by lower raw material costs has run

its course, still scope for operating leverage

Timeline

Corporate Profits:Margins are quite healthy

20

28.3

28.0

30.3

28.5

26.1

26.226.2

24.4

25.2

24.0

23.6

22.7

24.6

23.6

24.124.3

24.6

24.8 24.7

21.6

22.5

22.5

20.7

21.6

20.920.4

20.9

21.7

20.821.0

22.0

22.9

22.321.8

22.2

23.6

24.5

22.8

24.4

27.0

27.7

26.0

26.6

26.6

25.8

27.8

27.5

27.5

26.527.2

27.5

27.5

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19

Sensex Margin LPA: 24.5%

Data Source: MOSL; The vertical axis is on a logarithmic scale S&P BSE Sensex, EPS: Earnings per share. CAGR: Compound annual growth rate

S&

P B

SE S

en

sex E

PS

Timeline

Earnings Trend:Likely Acceleration

21

91

81

129 181 250

266

291

278

280

216

236

272 361

446

540 720

833

820

834

1024

1109

1179

1334

1347

1330

1347

1379

1674

2170

Ma

r-92

Ma

r-93

Ma

r-94

Ma

r-95

Ma

r-96

Ma

r-97

Ma

r-98

Ma

r-99

Ma

r-00

Ma

r-01

Ma

r-02

Ma

r-03

Ma

r-04

Ma

r-05

Ma

r-06

Ma

r-07

Ma

r-08

Ma

r-09

Ma

r-10

Ma

r-11

Ma

r-12

Ma

r-13

Ma

r-14

Ma

r-15

Ma

r-16

Ma

r-17

Ma

r-18

Ma

r-19

E

Ma

r-20

E

S&P BSE Sensex EPS Trend

21% 30%2%

-2% CAGR

Earnings growth recovery is essential for valuations to sustain

Data Source: Bloomberg P/E” Price to Earnings Ratio, Avg: Average, std dev: Standard Deviation, Data as of 22nd Oct, 2018

S&

P B

SE S

en

sex t

raili

ng

PE

Valuations:In the upper reaches

Timeline

P/E - FAIRLY VALUED

P/E - EXPENSIVE

P/E - CHEAP

8

10

12

14

16

18

20

22

24

26

28

P/E Average P/E +1 std dev -1 std dev

22.3

19.0

15.7

20.9

2222

Nifty 50 premium over Nifty Midcap Index (Forward P/E )

23

5%

3%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

60%

Nifty 50 premium over Nifty Midcap Index (Forward P/E )

23 Data Source: Bloomberg, Data as of 22nd Oct, 2018

Equity Mutual Fund Inflows include Arbitrage Funds, Equity Mutual Fund Inflows in CY 2018 till Sep 2018Data Source: AMFI. Mutual Funds (Equity & ELSS Schemes)FII (Foreign Institutional Investors)

Fund Flows:FPI/ FII Inflow and Equity MF Inflow trend

BnUSD

Calendar Year

24

18.5

-12.9

17.6

29.3

-0.5

24.5

19.8

16.2

3.3 2.9

8.0

-2.0

6.47.8

0.3

-3.1

1.6

-2.9-1.8

8.0

13.6

7.8

22.8

15.7

-15

-10

-5

0

5

10

15

20

25

30

FPI/ FII Inflow Equity MF Inflow

Performance is in local currency (Annualised)

Sorted on 1 Year Returns

2525Data Source : Bloomberg

CAGR: Compound annual growth rate

Performance (CARG %) as on 30/09/2018

Global Markets

25

Indices Country CY 18 - YTD 1 Year 3 Years 5 Years

NIKKEI 225 JAPAN 6% 18% 12% 11%

DOW JONES INDUS. AVG US 7% 18% 18% 12%

NIFTY 50 INDIA 4% 12% 11% 14%

S&P/ASX 200 INDEX AUSTRALIA 2% 9% 7% 4%

BRAZIL IBOVESPA INDEX BRAZIL 4% 7% 21% 9%

RUSSIAN RTS INDEX RUSSIA 3% 5% 15% -3%

CAC 40 INDEX FRANCE 3% 3% 7% 6%

FTSE 100 INDEX UK -2% 2% 7% 3%

JAKARTA COMPOSITE INDEX INDONESIA -6% 1% 12% 7%

HANG SENG INDEX HONGKONG -7% 1% 10% 4%

FTSE/JSE AFRICA ALL SHR SOUTHAFRICA -6% 0% 4% 5%

SWISS MARKET INDEX SWITZERLAND -3% -1% 2% 3%

DAX INDEX GERMANY -5% -5% 8% 7%

SHANGHAI SE COMPOSITE CHINA -15% -16% -3% 5%

Data Source : BloombergCAGR: Compound annual growth rate

Sorted on 1 Year ReturnsPerformance (CARG %) as on 30/09/2018

Top Sectors in last one year performance were IT, Energy and FMCG;

Realty, PSU Bank, Auto & Metals indices posted negative returns

Domestic Sector Performance

26

Indices CY 18 - YTD 1 Year 3 Years 5 Years

S&P BSE IT 39% 57% 11% 15%

S&P BSE Energy 11% 24% 26% 17%

S&P BSE FMCG 8% 18% 14% 12%

S&P BSE Healthcare 2% 11% -5% 10%

Nifty Bank -2% 4% 13% 21%

S&P BSE Oil & Gas -9% 0% 20% 13%

S&P BSE Cap Goods -11% 0% 4% 17%

S&P BSE Metal -11% -2% 25% 10%

S&P BSE Auto -20% -11% 7% 14%

Nifty PSU Bank -27% -11% -4% 5%

S&P BSE Realty -35% -18% 7% 8%

Equity Markets:Current Market Outlook

Global economic outlook is weaker due to rising trade tensions & weakness in emerging economies

High frequency indicators in India point to a growth acceleration being underway, but macro variablesturning adverse; except for inflation which remains in RBI target zone

Valuations (as of Oct 19) for the Sensex on a forward 12 month basis have dropped to the fair value zonefrom the expensive zone

Key benchmark indices like the Sensex have remained resilient, but this masks the broad & significantdamage to prices as you move down along the market cap curve

The consensus expectation for FY19 earnings growth is high and the earnings season would provide areality check

27

Only US equities, the US Dollar and Crude Oil have remained resilient

Product Positioning

Equity Category Schemes Benchmark (New)

Large Cap Fund UTI Mastershare Unit Scheme S&P BSE 100

Large & Mid Cap FundUTI Core Equity Fund

(Previously UTI Top 100 Fund)Nifty Large Midcap 250

Mid Cap Fund UTI Mid Cap Fund Nifty Midcap 150

Value Fund

UTI Value Opportunities Fund

(Previously UTI Opportunities Fund)

(Merging of UTI Multi Cap Fund)

S&P BSE 200

Multi Cap FundUTI Equity Fund

(Merging of UTI Bluechip Flexicap Fund)S&P BSE 200

Dividend Yield Fund UTI Dividend Yield Fund Nifty Dividend Opportunities 50

Thematic – Infrastructure UTI Infrastructure Fund Nifty Infrastructure

Thematic – MNC UTI MNC Fund Nifty MNC

Thematic – Lifestyle UTI India Lifestyle Fund Nifty India Consumption

Sectoral – Banking & FinancialUTI Banking & Financial Services Fund

(Previously UTI Banking Sector Fund)Nifty Financial Services

Sectoral – HealthcareUTI Healthcare Fund

(Previously UTI Pharma & Healthcare Fund)S&P BSE Healthcare

Sectoral – Auto UTI Transportation & Logistics Fund UTI Transportation & Logistics

ELSS UTI Long Term Equity Fund (Tax Saving) S&P BSE 200

Equity Funds Category

29

Debt Category Schemes Benchmark (New)

Overnight FundUTI Overnight Fund

(Previously UTI G Sec Fund STP)CRISIL CBLO

Liquid Fund UTI Liquid Cash Plan CRISIL Liquid Fund

Ultra Short Duration FundUTI Ultra Short Term Fund

(Previously UTI Floating Rate Fund)CRISIL Ultra Short Term Debt

Low Duration Fund UTI Treasury Advantage Fund CRISIL Low Duration Debt

Money Market Fund UTI Money Market Fund CRISIL Money Market

Short Duration Fund UTI Short Term Income Fund CRISIL Short Term Bond Fund

Corporate Bond Fund UTI Corporate Bond Fund CRISIL Corporate Bond Composite

Medium Duration Fund UTI Medium Term Fund CRISIL Medium Term Debt

Medium to Long Duration Fund UTI Bond Fund CRISIL Medium to Long Term Debt

Dynamic Bond UTI Dynamic Bond Fund CRISIL Dynamic Debt

Credit Risk FundUTI Credit Risk Fund

(Previously UTI Income Opp. Fund)CRISIL Short Term Bond Fund

Banking and PSU Fund UTI Banking and PSU Debt Fund CRISIL Banking and PSU Debt

Gilt FundUTI Gilt Fund

(Previously UTI Gilt Adv. Fund LTP)CRISIL Dynamic Gilt

Debt Funds Category

30

#Equity: S&P BSE 200; Debt & Money Market Instruments: CRISIL Bond Fund; Gold ETFs: Prices of Gold

Hybrid Category Schemes Benchmark (New)

Conservative Hybrid Fund

UTI Regular Savings Fund

(Previously UTI MIS Advantage Plan)

(Merging of UTI CRTS, UTI MIS & UTI SWSP)

CRISIL Hybrid 75 + 25

Conservative

Aggressive Hybrid FundUTI Hybrid Equity Fund

(Previously UTI Balanced Fund)

CRISIL Hybrid 25+75

Aggressive

Equity Savings Fund UTI Equity Savings Fund CRISIL Equity Savings Index

Multi Asset AllocationUTI Multi Asset Fund

(Previously UTI Wealth Builder Fund)Customised Index#

ArbitrageUTI Arbitrage Fund

(Previously UTI Spread Fund)Nifty 50 Arbitrage

Hybrid, Solution Oriented, Index & ETFs Category

Index / ETFs Schemes Benchmark (New)

Index Fund UTI Nifty Index Fund Nifty 50

Index Fund UTI Nifty Next 50 Index Fund Nifty Next 50

ETF – S&P BSE Sensex UTI Sensex Exchange Traded Fund S&P BSE Sensex

ETF – Nifty 50 UTI Nifty Exchange Traded Fund Nifty 50

ETF – Nifty Next 50 UTI Nifty Next 50 Exchange Traded Fund Nifty Next 50

ETF – Gold UTI Gold Exchange Traded Fund Prices of Gold

Solution Oriented Schemes Benchmark (New)

Children's Fund

UTI Children’s Career Fund – Savings Plan

(Previously UTI Children’s Career Balanced Fund)

CRISIL Short Term Debt

Hybrid 60+40 Fund

UTI Children’s Career Fund – Investment Plan

(Previously UTI CCP Advantage Fund)S&P BSE 200

Retirement Fund UTI Retirement Benefit Pension FundCRISIL Short Term Debt

Hybrid 60+40 Fund

31

Equity – Products

UTI MastershareUnit Scheme

UTI Core Equity Fund

UTI Equity Fund


UTI Mid Cap Fund

Market Capitalisation

Large Cap Mid Cap Small Cap Scheme Characteristics

Min. 80% in Large Cap Stocks

Min. 35% in Large & Mid Cap each

Investing across the Market Caps

Following Value investment Strategy

Min. 65% in Mid Cap Stocks

32

Fixed Income – Product Positioning : Duration vis-a-vis Credit Quality

1 day 3 to 4 yrs0 to 3 mths

3 to 6

mths6 to 12 mths

1 to 3 years

4 to 7 yrs 7+ yrs

CREDIT ORIENTEDAAA/AA+: <=35%

AA/AA-/A : 65% >=

MODERATE QUALITYAAA/AA+: 50% to 70%

AA/ AA-/ A : 30% to 50%

HIGH QUALITYAAA/ AA+ : 80% >= AA/ AA-/ A: <= 20%

HIGHEST QUALITYAAA/AA+ : 95% >=,

AA/ AA-/ A : <= 5%

DURATION BUCKET

CREDITQUALITY

UTI

OVERNIGHT

FUND

UTI LIQUID

CASH PLAN

UTI ULTRA

SHORT

TERM FUND

UTI TREASURY

ADVTG FUND

UTI MONEY

MKT FUND

UTI B&PSUD

FUND

UTI SHORT TERM

INCOME FUNDUTI BOND

FUND

UTI CREDIT

RISK FUND

UTI GILT FUND

UTI DYNAMIC

BOND FUND

UTI MEDIUM

TERM FUND

33

UTI CORPORATE

BOND FUND

Hybrid - bucketing by Scheme Characteristics

UTI CCF – Savings Plan

UTI RBPF


Debt :60% to 100%

Equity : 0% to 40%

Debt :75% to 90%

Equity :10% to 25%

Debt :60% to 100%

Equity : 0% to 40%

UTI Hybrid Equity Fund Equity :65% to 80%

Debt: 20% to 35%

UTI Arbitrage Fund Equity : 65% to 100%

Derivatives :65% to 100%

UTI Multi-Asset Fund*Equity :65% to 100%

Debt:10%to 25

Gold:10% to 25%

UTI CCF – Investment PlanEquity : 70% to 100%

Debt : 0% to 30%

Arbitrage

Multi Asset

Hybrid Aggressive

Solution Children

Solution Retirement

Conservat

Hybrid Conservative

Solution Children

UTI ULIP@ Dynamic Allocation Debt :60% to 100%

Equity : 0% to 40%

9

3

2

1

5

6

7

8

*of which Cash future arbitrage opportunities 20% to 75%, Net long equity position 20% to 50%@ subject to SEBI approval

34

UTI Equity Savings Fund Equity: 65% to 90%*

Debt: 10% to 35% Equity Savings4

Name of the Scheme This product is suitable for investors who are seeking* Riskometer

UTI Mastershare Unit Scheme

(Large Cap Fund- An open ended equity scheme

predominantly investing in large cap stocks)

• Long term capital appreciation

• Investment predominantly in equity instruments of large cap

companies

UTI Core Equity Fund

(Large & Mid Cap Fund- An open ended equity scheme

investing in both large cap and mid cap stocks)


• Investment predominantly in equity instruments of both large cap

and mid cap companies

UTI Mid Cap Fund

(Mid Cap Fund- An open ended equity scheme

predominantly investing in mid cap stocks)


• Investment predominantly in mid cap companies


(An open ended equity scheme following a value

investment strategy)


• Investment in equity instruments following a value investment

strategy across the market capitalization spectrum

UTI Equity Fund

(Multi Cap Fund- An open ended equity scheme investing

across large cap, mid cap, small cap stocks)


• Investment in equity instruments of companies with good growth

prospects across the market capitalization spectrum

UTI Dividend Yield Fund

(An open ended equity scheme predominantly investing in

dividend yielding stocks)


• Investment predominantly in dividend yielding equity and equity

related securities

UTI Infrastructure Fund

(An open ended equity scheme following the

Infrastructure theme)


• Investment predominantly in equity and equity related securities of

companies forming part of the infrastructure sector

UTI MNC Fund

(An open ended equity following the theme of investing

predominantly in equity and equity related securities of

Multi-National Companies)



Multi-National companies

UTI India Lifestyle Fund

(An open ended equity scheme following the theme of

changing consumer aspirations, changing lifestyle and

growth of consumption)

• Long term capital growth

• Investment in equity instruments of companies that are expected to

benefit from of the changing consumer aspirations, changing

lifestyle and growth of consumption

Product Label

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

35


UTI Banking and Financial Services Fund

(An open ended equity scheme investing in Banking and

Financial Services Sector)



companies engaged in banking and financial services activities.

UTI Healthcare Fund

(An open ended equity scheme investing in the Healthcare

Services Sector)


• Investment predominantly in equity and equity related securities in the

Healthcare Services sector.

UTI Transportation and Logistics Fund

(An open ended equity scheme investing in transportation

and logistics sector)


• Investment predominantly in equity and equity related securities of the

companies engaged in the transportation and logistics sector

UTI Long Term Equity Fund (Tax Saving)

(An open ended equity linked saving scheme with a

statutory lock in of 3 years and tax benefit)

• Long term capital growth

• Investment in equity instruments of companies that are believed to

have growth potential

UTI Arbitrage Fund

(An open ended scheme investing in arbitrage

opportunities)

• Capital appreciation over medium to long term

• Takes advantage of arbitrage opportunities in cash and derivative

market without taking any directional/ unhedged position in either

equity or derivative instruments

UTI Nifty Index Fund

(An open ended scheme replicating/ tracking Nifty 50

index)

• Capital growth in tune with the index returns

• Passive investment in equity instruments comprised in Nifty 50 Index

UTI Nifty Next 50 Index Fund


index)

• Capital growth in tune with the index returns

• Passive investment in equity instruments comprised in Nifty Next 50

Index

UTI Sensex Exchange Traded Fund

(An open ended scheme replicating/ tracking S&P BSE

Sensex index)

• Long term investment

• Investment in securities covered by S&P BSE Sensex

UTI Nifty Exchange Traded Fund


index)


• Investment in securities covered by Nifty 50 Index

UTI Nifty Next 50 Exchange Traded Fund

(An open ended scheme replicating/ tracking Nifty Next 50

index)


• Investment in securities covered by Nifty Next 50

UTI Gold Exchange Traded Fund

(An open ended scheme replicating/ tracking Gold)

• Returns that, before expenses of the Scheme, closely track the

performance and yield of Gold

• Investment predominantly in gold and gold related instruments

Product Label

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.36


UTI Overnight Fund

(An open ended debt scheme investing in overnight securities)

• Reasonable income over one day with capital preservation

• Investment in overnight securities

UTI Liquid Cash Plan

(An open ended liquid scheme)• Steady and reasonable income over short-term with capital

preservation.

• Investment in money market securities & high quality debt

UTI Ultra Short Term Fund

(An open ended ultra-short term debt scheme investing in instruments such

that the Macaulay duration of the portfolio is between 3 months and 6

months)

• Reasonable income with low volatility over short term

• Investment in debt & money market instruments

UTI Treasury Advantage Fund

(An open ended low duration debt scheme investing in instruments such that

the Macaulay duration of the portfolios is between 6 months and 12 months)

• Reasonable income consistent with high liquidity over short term

• Investment in Debt & Money Market instruments

UTI Money Market Fund

(An open ended debt scheme investing in money market

instruments)

• Reasonable income with high level of liquidity over short-term

• Investment in money market securities

UTI Corporate Bond Fund

(An open ended debt scheme predominantly investing in AA+ and

above rated corporate bonds)

• Optimal returns over the medium to long term

• To invest predominantly in AA+ and above rated corporate debt

UTI Short Term Income Fund

(An Open ended Short Term Debt Scheme investing in instruments such that

the Macaulay duration of portfolio is between 1 year and 3 years)

• Reasonable income with low risk and high level of liquidity over

short-term

• Investment in Debt & Money Market instrument

UTI Medium Term Fund

(An open ended medium term debt scheme investing in instruments such

that the Macaulay duration of the portfolio is between 3 years and 4 years)

• Reasonable income over the medium to long term

• Investment in Debt & Money Market Instruments

UTI Bond Fund

(An open ended medium term debt scheme investing in instruments such

that the Macaulay duration of the portfolio is between 4 years and 7 years)

• Optimal returns with adequate liquidity over medium to long term

• Investment in Debt & money market instruments

UTI Dynamic Bond Fund

(An open ended dynamic debt scheme investing across duration)

• Optimal returns with adequate liquidity over medium to long term

• Investment in Debt & Money Market Instruments

UTI Credit Risk Fund

(An open ended debt scheme predominantly investing in AA and below

rated corporate bonds (excluding AA+ rated corporate bonds))

• Reasonable income and capital appreciation over medium to

long term

• Investment in debt and money market instruments

Product Label

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.37


UTI Banking and PSU Debt Fund

(An open ended debt scheme predominantly investing in

debt instruments of Banks, Public Sector Undertakings,

Public Financial Institutions and Municipal Bonds)

• Reasonable income, with low risk and high level of liquidity over short to

medium term

• Investment predominantly in Debt & Money Market Securities issued by

Bank, Public Sector Undertaking (PSUs), Public Financial Institutions (PFIs)

and Municipal Bonds

UTI Gilt Fund

(An open ended debt scheme investing in government

securities across maturities)

• Credit risk free return over the medium to long term

• Investment in sovereign securities issued by the Central Government

and/or a State Government and/or any security unconditionally

guaranteed by the Central Government and/or a State Govt.


(An open ended hybrid scheme investing predominantly in

debt instruments)

• Long-term capital appreciation and regular income over medium-term

• Investment in equity instruments (maximum 25%) and fixed income

securities (debt and money market securities)

UTI Hybrid Equity Fund

(An open ended hybrid scheme investing predominantly in

equity & equity related instruments)


• Investment in equity instruments (maximum-80%) and fixed income

securities (debt and money market securities)

UTI Equity Savings Fund

(An open ended scheme investing in equity, arbitrage and

debt)

• Long term capital appreciation and income

• Investment in equity & equity related instruments, arbitrage opportunities,

and investments in debt and money market opportunities

UTI Multi Asset Fund

(An open ended scheme investing in equity, debt & Gold

ETFs)


• Investment in equity, debt and Gold ETFs with a minimum allocation of

10% in each asset class.

UTI Children’s Career Fund – Savings Plan

(An open ended fund for investment for children having a

lock-in for at least 5 years or till the child attains age of

majority (whichever is earlier))


• Investment in equity instruments (maximum-40%) and debt instruments

UTI Children’s Career Fund – Investment Plan

(An open ended fund for investment for children having a

lock-in for at least 5 years or till the child attains age of

majority (whichever is earlier))


• Investment in equity instruments (above 70%) and debt instruments

UTI Retirement Benefit Pension Fund

(An open ended retirement solution oriented scheme

having a lock-in of 5 years or till retirement age (whichever

is earlier)


• Investment in equity instruments (maximum - 40%) and debt/money

market instruments

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Product Label

38

AMFI: Association of Mutual Funds of India

Avg. Average

Bn: Billion

BoJ: Bank of Japan

BoP: Balance of Payments

CAD: Current Account Deficit

CAGR: Compounded Annualized Growth Rate

CP: Commercial Papers

CPI(IW): CPI Industrial Workers

CPI: Consumer Price Index

CPOS: Capital Protection Oriented Scheme

CSO: Central Statistical Office

Dual Adv. FTF: Dual Advantage Fixed Term Fund

EBITDA: Earning Before Interest, Tax, Depreciation, Amortization

ECB: External Commercial Borrowing

ELSS: Equity Linked Savings Scheme

EPS: Earnings Per Share

FD: Fiscal Deficit

FMPs: Fixed Maturity Plans

Forex: Foreign exchange

FTIF: Fixed Term Income Fund

FY: Financial Year

GDP: Gross Domestic Product

GVA: Gross Value Added

39

Glossary

GST: Goods & Services Tax

IIP: Index of Industrial Production

INR: Indian Rupee

MF: Mutual Fund

MOSPI: Ministry of Statistics and Programme Implementation

P/E: Price to Earning Multiple

RBI: Reserve Bank of India

SEBI: Securities & Exchange Board of India

US Fed/Fed: US Federal Reserve

USD: US Dollar

vs: Versus

WPI: Wholesale Price Index

YoY: Year on Year

Thank You

REGISTERED OFFICE: UTI Tower, ‘Gn’ Block, Bandra Kurla Complex, Bandra (E), Mumbai - 400051. Phone: 022 – 66786666. UTI Asset Management

Company Ltd (Investment Manager for UTI Mutual Fund) Email: [email protected] . (CIN-U65991MH2002GOI137867). For more information, please

contact the nearest UTI Financial Centre or your AMFI/NISM certified UTI Mutual Fund Independent Financial Advisor (IFA) for a copy of the

Statement of Additional Information, Scheme Information Document and Key Information Memorandum cum Application Form.

Disclaimers: The information on this document is provided for information purposes only. It does not constitute any offer, recommendation or

solicitation to any person to enter into any transaction or adopt any hedging, trading or investment strategy, nor does it constitute any

prediction of likely future movements in rates or prices or any representation that any such future movements will not exceed those shown in

any illustration. Users of this document should seek advice regarding the appropriateness of investing in any securities, financial instruments or

investment strategies referred to on this document and should understand that statements regarding future prospects may not be realized.

The recipient of this material is solely responsible for any action taken based on this material. Opinions, projections and estimates are subject

to change without notice.

UTI AMC Ltd is not an investment adviser, and is not purporting to provide you with investment, legal or tax advice. UTI AMC Ltd or UTI Mutual

Fund (acting through UTI Trustee Company Pvt. Ltd) accepts no liability and will not be liable for any loss or damage arising directly or

indirectly (including special, incidental or consequential loss or damage) from your use of this document, howsoever arising, and including

any loss, damage or expense arising from, but not limited to, any defect, error, imperfection, fault, mistake or inaccuracy with this document,

its contents or associated services, or due to any unavailability of the document or any part thereof or any contents or associated services.

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.

UTI Market Outlook Report...Fiscal Deficit: India’s fiscal deficit for Apr-Jul 2018 came in at Rs. 5.40 lakh crore, or 86.5% of the budgeted target for FY19 against 92.4% a year

Documents