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MUTUAL FUNDS 05 OCT 2016

RETAIL RESEARCH
Identifying Turnaround Equity Mutual Fund Schemes

From the following tables, we try to identify how the equity oriented schemes performed in the last 18 months in comparison to the previous periods. This will help
identify turnaround schemes at an early stage. For this we looked at the rolling returns based performance (1,3,6 months periods in the last 18 months and also 6
month rolling in past 36 months).

Rolling Returns give more realistic view of investment returns as it is the average of point to point returns that are calculated every day in the given periods. Rolling
Returns measures the performance of the scheme during all the various market cycles that the schemes passed through such as Bull phase, Bear phase and the period
wherein the market moved side-ways.

If we take rolling returns performance over 3, 5, 7 years, there may be the chance to miss out some of the turnaround schemes which have started performing well in
the recent periods. Considering this, we have conducted a study and calculated the returns for the two time frames viz, in the last 18 months and period prior to 18
months.

For the period in the 18 months, we calculated point to point return and rolling returns. For the period prior to 18 months, we considered data from April 2010 to Apr
2015 and calculated returns in ascending and descending ways. This enables us to get rid of the impact of the skewness due to impact of the recent midcap rally on the
schemes.

There are 252 schemes are selected for this study, ranked ranging from "Top Quartile" to "Bottom Quartile" and then highlighted with different colours. The Top
Quartile or First Quartile funds are highlighted with yellow while the Second Quartile are coloured with green. The Third Quartile funds are highlighted with light
Orange while the Fourth Quartile funds are highlighted with grey.

The table 1 lists out the schemes which have been showing consistent performance since April 2010. It is clearly seen that the schemes from mid and small cap
spectrum appeared prominently in the table.
Table 1:
Trailing Returns (%) Rolling Returns (%)
from (01-Apr-2015 To 28-Sep-2016)
Calculating from last 18
Latest Ascending Descending 18 Month last 3
Months
Performance Years
Scheme Name Corpus
(Rs Crs) Apr- Apr- (Apr-15
Apr-10 Apr-10 Apr-10 Apr-11 Apr-12 Apr-13 Apr-14
10 To 10 To To 1 3 6 6 Max
To To To To To To To Max Gain
Apr- Apr- Sep-16) Month Month Month Month Drawdown
Apr-13 Apr-14 Apr-15 Apr-15 Apr-15 Apr-15 Apr-15
11 12
DSPBR Micro-Cap Fund-Reg(G) 3650 11.38 10.78 11.66 47.58 199.42 168.83 170.28 168.15 102.89 29.13 1.47 5.17 8.41 23.69 18.46 -9.46
Franklin India Smaller Cos Fund(G) 3734 6.77 1.70 18.91 60.91 190.93 172.48 186.08 144.65 80.80 21.08 1.22 4.23 7.33 19.89 16.83 -8.37
Mirae Asset Emerging BlueChip-(G) 2405 174.71 157.38 132.66 73.66 26.51 1.45 4.67 6.57 19.23 21.54 -3.07
DSPBR Small & Mid Cap Fund-Reg(G) 2312 13.00 10.00 13.42 40.64 136.21 109.04 114.73 108.26 67.96 22.67 1.27 4.51 6.25 16.96 19.02 -9.10
Birla SL Pure Value Fund(G) 563 8.65 5.66 11.58 46.18 151.41 131.40 137.95 125.32 71.99 24.07 1.31 4.34 6.14 20.18 13.96 -12.37
SBI Magnum MidCap Fund-Reg(G) 2623 0.51 0.14 13.79 59.08 167.59 166.24 167.22 135.16 68.21 21.25 1.19 3.98 6.09 17.87 13.83 -5.68
Kotak Emerging Equity Scheme(G) 1092 0.07 2.41 8.45 25.68 135.60 135.43 130.06 117.24 87.47 20.28 1.14 4.02 6.06 19.66 16.25 -9.94
ICICI Pru Banking & Fin Serv Fund(G) 1124 22.71 10.58 33.61 53.03 139.42 95.11 116.51 79.19 56.45 23.69 1.43 4.81 6.00 15.38 18.5 -21.00

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Kotak Midcap Scheme(G) 453 9.33 9.15 15.83 35.88 129.35 109.79 110.14 98.01 68.80 22.12 1.19 4.06 5.93 17.17 19.11 -6.46
SBI FMCG Fund-Reg(D) 276 29.78 64.45 120.88 152.87 220.10 146.64 94.65 44.92 26.59 16.99 0.94 3.67 5.89 8.54 3.79 -20.99
Franklin India Prima Fund(G) 4542 3.93 4.15 19.12 51.48 159.88 150.06 149.53 118.16 71.56 16.53 1.01 3.55 5.70 17.37 13.55 -8.11
SBI Small & Midcap Fund-Reg(G) 812 12.03 2.35 13.35 42.86 174.69 145.20 168.39 142.35 92.28 26.65 1.18 3.87 5.48 21.93 19.71 -1.13
Sundaram Select Midcap(G) 4164 8.52 7.67 15.17 42.47 148.54 129.02 130.83 115.80 74.44 22.27 1.25 4.10 5.14 18.09 15.9 -9.56
SBI Emerging Businesses Fund-Reg(G) 1838 13.65 27.73 54.66 69.78 164.75 132.95 107.27 71.18 55.93 14.50 0.81 2.96 5.12 13.46 12.50 -5.48
HDFC Mid-Cap Opportunities Fund(G) 12997 14.50 23.74 31.22 70.07 181.21 145.59 127.27 114.31 65.35 22.06 1.20 3.69 4.98 16.85 15.95 -10.10
Birla SL India GenNext Fund(G) 463 14.99 21.23 43.04 68.81 162.14 127.96 116.23 83.27 55.29 19.54 1.15 3.52 4.74 12.86 18.83 -5.13
Principal Emerging Bluechip Fund(G) 620 -1.72 -8.15 5.42 35.01 134.91 139.01 155.76 122.82 74.00 17.81 1.10 3.54 4.65 17.64 14.52 -11.57

The below table 2 lists out the schemes which had showed poor or below average performance in the past periods, but have turned around and started to perform
well in the last 18 months. Ideally, these schemes need to be watched out as they may start to perform well going forward.
Table 2:
Trailing Returns (%) Rolling Returns (%)
(01-Apr-2015 To 28-Sep-
Calculating from last 18 from last 2016)
Ascending Descending
Latest Months 3 Years
18 Month
Corpus Performance
Scheme Name
(Rs Apr- Apr- Apr- Apr- Apr- Apr- Apr- Apr- Apr- (Apr-15
Crs) 6 Month
10 To 10 To 10 To 10 To 10 To 11 To 12 To 13 To 14 To To 1 3 6 Month Max
(18 Max Gain
Apr- Apr- Apr- Apr- Apr- Apr- Apr- Apr- Apr- Sep-16) Month Month (3 Years) Drawdown
Months)
11 12 13 14 15 15 15 15 15

Sundaram Rural India Fund(G) 386 11.45 7.58 14.07 32.85 88.25 68.92 74.99 65.03 41.70 35.25 1.82 6.05 10.64 13.91 22.89 -7.36
DSPBR Natural Res & New Energy (G) 72 12.04 2.90 -11.23 5.14 42.02 26.76 38.02 59.98 35.08 31.63 1.60 5.05 10.41 13.37 17.69 -10.30
Quantum Tax Saving Fund(G) 49 17.19 14.91 25.83 54.04 99.30 70.07 73.44 58.39 29.38 17.84 1.07 3.47 6.66 10.19 16.34 -6.87
Quantum LT Equity Fund(G) 593 18.55 16.51 27.64 56.58 101.41 69.90 72.87 57.80 28.63 18.18 1.08 3.47 6.59 10.19 16.72 -6.53
JM Core 11 Fund(G) 31 -10.48 -22.89 -22.86 -6.87 33.73 49.39 73.43 73.36 43.59 18.55 1.26 4.01 5.83 12.46 18.35 -20.23
HDFC Small and Mid Cap Fund-Reg(G) 939 8.64 -1.41 7.10 31.05 86.70 71.85 89.38 74.32 42.47 19.58 1.00 3.52 5.23 11.81 16.76 -10.05
SBI Magnum Multicap Fund-Reg(G) 1096 -0.95 -7.85 -0.66 16.63 82.92 84.68 98.51 84.13 56.84 16.18 0.90 3.27 5.19 13.92 13.61 -7.38
Tata India Tax Savings Fund-Reg(DP) 393 9.20 6.03 14.54 37.48 110.02 92.32 98.07 83.36 52.77 15.26 0.98 3.43 5.16 12.72 16.36 -5.92
DSPBR Opportunities Fund-Reg(G) 1117 12.46 1.63 10.00 31.74 96.12 74.39 92.97 78.29 48.87 17.08 1.04 3.55 5.04 11.77 16.44 -9.96
DSPBR Tax Saver Fund-Reg(G) 1416 7.27 -0.16 11.17 35.37 105.39 91.46 105.72 84.75 51.72 17.42 1.04 3.54 5.01 12.84 17.08 -9.42
L&T Tax Saver Fund(G) 29 7.05 -6.85 -5.99 17.65 63.31 52.55 75.32 73.72 38.80 22.55 1.26 4.00 4.85 11.75 19.11 -7.70
ICICI Pru Child Care Plan-Gift Plan 363 1.88 3.45 10.17 35.33 91.66 88.12 85.27 73.98 41.63 14.36 0.83 3.02 4.78 12.19 13.15 -8.58
Birla SL Equity Fund(G) 2901 2.18 -7.28 -0.17 25.66 92.56 88.46 107.69 92.89 53.23 18.04 1.04 3.25 4.60 13.58 16.4 -11.66
JM Basic Fund(G) 166 -25.04 -33.30 -32.79 -22.18 18.44 58.01 77.57 76.23 52.19 17.21 1.12 3.56 4.37 13.54 13.99 -16.36
Kotak Select Focus Fund(G) 5876 8.86 3.74 13.19 39.19 113.44 96.06 105.74 88.56 53.35 15.71 0.94 3.12 3.85 12.87 11.98 -9.74
Sundaram Tax Saver(D) 1369 5.10 1.24 8.72 23.92 79.29 70.59 77.09 64.91 44.69 13.49 0.86 3.03 3.82 11.12 12.69 -12.75
Kotak Balance(D) 386 5.11 5.50 16.50 30.94 67.41 59.27 58.68 43.70 27.85 11.81 0.65 2.27 3.82 7.62 2.23 -13.48
Birla SL Special Situations Fund(G) 147 -0.09 -10.85 -6.46 9.93 82.48 82.63 104.69 95.07 65.99 15.53 0.98 3.41 3.78 14.50 12.72 -14.58
Principal Balanced Fund(G) 36 1.40 -1.73 8.19 28.79 68.77 66.45 71.75 56.00 31.04 15.72 0.85 2.64 3.76 8.86 10.57 -10.77
ICICI Pru Top 100 Fund(G) 1457 10.71 9.08 17.02 45.65 93.24 74.54 77.16 65.13 32.68 11.57 0.61 2.09 3.76 8.66 10.46 -12.15

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DSPBR Balanced Fund-Reg(G) 1510 10.19 8.45 11.40 24.00 79.70 63.08 65.70 61.31 44.92 16.66 0.92 2.90 3.76 11.08 13.55 -6.48

The schemes listed out in the table 3 is based on the summation value of the maximum gain and maximum drawdown. Maximum gain and maximum drawdown are
calculated by cumulating the daily returns of the schemes for a given period. This indicates the risk reward focus of the schemes.

A maximum drawdown is the maximum loss from a peak to a trough of a portfolio, before a new peak is attained. Maximum Drawdown is an indicator of downside risk
over a specified time period. Maximum Gain indicates possibility of generating higher returns over a specified time period. Higher the sum value shows the better risk
adjusted performance of the schemes.
Table 3:
Trailing Returns (%) Rolling Returns (%)

(01-Apr-2015 To 28-Sep-2016)
from
Latest Calculating from last 18
Ascending Descending 18 Month last 3
Scheme Name Corpus Months
Performance Years
(Rs Crs)
(Apr-15
Apr- Apr- Apr- Apr-
Apr-10 Apr-11 Apr-12 Apr-13 Apr-14 To
10 To 10 To 10 To 10 To 1 3 6 6 Max Max
To To To To To Sep-16) Sum
Apr- Apr- Apr- Apr- Month Month Month Month Gain Drowdown
Apr-15 Apr-15 Apr-15 Apr-15 Apr-15
11 12 13 14
SBI Small & Midcap Fund-Reg(G) 812 12.03 2.35 13.35 42.86 174.69 145.20 168.39 142.35 92.28 26.65 1.18 3.87 5.48 21.93 19.71 -1.13 18.58
Mirae Asset Emerging BlueChip-Reg(G) 2405 174.71 157.38 132.66 73.66 26.51 1.45 4.67 6.57 19.23 21.54 -3.07 18.47
Sundaram Rural India Fund(G) 386 11.45 7.58 14.07 32.85 88.25 68.92 74.99 65.03 41.70 35.25 1.82 6.05 10.64 13.91 22.89 -7.36 15.53
Birla SL India GenNext Fund(G) 463 14.99 21.23 43.04 68.81 162.14 127.96 116.23 83.27 55.29 19.54 1.15 3.52 4.74 12.86 18.83 -5.13 13.70
Kotak Midcap Scheme(G) 453 9.33 9.15 15.83 35.88 129.35 109.79 110.14 98.01 68.80 22.12 1.19 4.06 5.93 17.17 19.11 -6.46 12.65
Escorts Leading Sectors Fund(G) 3 2.11 -3.73 7.70 27.80 110.54 106.19 118.70 95.48 64.75 21.05 0.88 3.05 5.13 16.08 15.7 -3.30 12.40
L&T Tax Saver Fund(G) 29 7.05 -6.85 -5.99 17.65 63.31 52.55 75.32 73.72 38.80 22.55 1.26 4.00 4.85 11.75 19.11 -7.70 11.41
BNP Paribas Mid Cap Fund(G) 700 7.72 16.43 30.99 65.52 182.52 162.26 142.66 115.68 70.68 16.97 1.03 3.45 3.55 16.22 17.03 -5.70 11.33
Birla SL Small & Midcap Fund(G) 304 0.44 -0.24 1.66 27.11 108.11 107.21 108.61 104.71 63.72 28.99 1.52 5.15 8.25 17.03 20.26 -9.19 11.07
Templeton India Equity Income Fund(G) 951 12.90 4.55 17.70 33.34 79.50 59.00 71.69 52.51 34.62 13.22 0.55 1.56 2.22 8.76 16.48 -5.97 10.51
Tata India Tax Savings Fund-Reg(DP) 393 9.20 6.03 14.54 37.48 110.02 92.32 98.07 83.36 52.77 15.26 0.98 3.43 5.16 12.72 16.36 -5.92 10.44
Birla SL India Opportunities Fund(G) 138 1.68 -6.72 -2.92 34.90 107.04 103.63 121.97 113.27 53.48 8.62 0.52 1.95 2.33 13.32 13.75 -3.49 10.26
Quantum LT Equity Fund(G) 593 18.55 16.51 27.64 56.58 101.41 69.90 72.87 57.80 28.63 18.18 1.08 3.47 6.59 10.19 16.72 -6.53 10.19
ICICI Pru Balanced Fund(G) 3477 11.61 17.14 31.32 58.77 121.90 98.82 89.43 68.97 39.76 15.38 0.81 2.61 3.73 10.44 15.77 -5.63 10.14
DSPBR Small & Mid Cap Fund-Reg(G) 2312 13.00 10.00 13.42 40.64 136.21 109.04 114.73 108.26 67.96 22.67 1.27 4.51 6.25 16.96 19.02 -9.10 9.92
Escorts Tax(G) 4 0.18 -17.0 -28.7 -17.9 26.84 26.62 52.92 77.97 54.59 28.66 1.42 4.98 10.36 15.72 17.81 -7.89 9.92
Templeton India Growth Fund(D) 529 5.20 -3.79 2.24 16.14 62.24 54.23 68.63 58.68 39.69 14.33 0.85 2.48 2.19 10.55 16.6 -6.96 9.64
Quantum Tax Saving Fund(G) 49 17.19 14.91 25.83 54.04 99.30 70.07 73.44 58.39 29.38 17.84 1.07 3.47 6.66 10.19 16.34 -6.87 9.47
DSPBR Micro-Cap Fund-Reg(G) 3650 11.38 10.78 11.66 47.58 199.42 168.83 170.28 168.15 102.89 29.13 1.47 5.17 8.41 23.69 18.46 -9.46 9.00
Franklin India Smaller Cos Fund(G) 3734 6.77 1.70 18.91 60.91 190.93 172.48 186.08 144.65 80.80 21.08 1.22 4.23 7.33 19.89 16.83 -8.37 8.46
Reliance RSF-Balanced 3294 6.22 5.62 15.52 36.43 91.35 80.15 81.17 65.64 40.26 13.08 0.71 2.46 3.47 11.00 13.01 -4.85 8.16
SBI Magnum MidCap Fund-Reg(G) 2623 0.51 0.14 13.79 59.08 167.59 166.24 167.22 135.16 68.21 21.25 1.19 3.98 6.09 17.87 13.83 -5.68 8.15
Birla SL Dynamic Asset Allocation 7 8.18 5.39 12.64 26.97 56.93 45.07 48.90 39.32 23.60 18.82 1.04 3.43 5.62 7.92 14.35 -6.44 7.91

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DSPBR Tax Saver Fund-Reg(G) 1416 7.27 -0.16 11.17 35.37 105.39 91.46 105.72 84.75 51.72 17.42 1.04 3.54 5.01 12.84 17.08 -9.42 7.66

Ideally, Tables 2 & 3 are to be watched out going forward as these schemes may be able to generate relatively higher returns in the future.

However betting on schemes that are showing turnaround in 18 months period carries risk as 18 month period may not be large enough and before showing consistent
performance going forward, there may be reversal in fortunes of some of these schemes based on composition of portfolio and macro developments impacting it, skills
of fund manager, dynamism in the macro economy / sector and the managers ability to respond to them.

Source: NAVIndia.com & ACEMF

RETAIL RESEARCH Tel: (022) 3075 3400 Fax: (022) 2496 5066 Corporate Office

HDFC securities Limited, I Think Techno Campus, Building - B, "Alpha", Office Floor 8, Near Kanjurmarg Station, Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042 Phone: (022) 3075 3400 Fax: (022) 2496 5066 Website: www.hdfcsec.com Email:
hdfcsecretailresearch@hdfcsec.com.

Disclaimer: Mutual Funds investments are subject to risk. Past performance is no guarantee for future performance.This document has been prepared by HDFC Securities Limited and is meant for sole use by the recipient and not for circulation. This document is not to be reported or
copied or made available to others. It should not be considered to be taken as an offer to sell or a solicitation to buy any security. The information contained herein is from sources believed reliable. We do not represent that it is accurate or complete and it should not be relied upon as
such. We may have from time to time positions or options on, and buy and sell securities referred to herein. We may from time to time solicit from, or perform investment banking, or other services for, any company mentioned in this document. This report is intended for non-Institutional
Clients.

This report has been prepared by the Retail Research team of HDFC Securities Ltd. The views, opinions, estimates, ratings, target price, entry prices and/or other parameters mentioned in this document may or may not match or may be contrary with those of the other Research teams
(Institutional, PCG) of HDFC Securities Ltd. HDFC Securities Ltd. is a SEBI Registered Research Analyst having registration no. INH000002475.

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