Investment Analysis and Portfolio Management of Indian Breweries Market 2017

Investment Analysis and Portfolio Management
Name of The Fund: Stratton Oakmont Mutual Fund
Date of Submission: 25th September, 2017
TYBBA- E (Group 5):

Roll No. 21 Roll No. 22 Roll No. 23 Roll No. 24 Roll No. 25
Pragya Pranav Preksha Prithu Priyal
Goyal Agarwal Parmar Chawla Sangal
TABLE OF CONTENTS
1. Introduction 3
2. Fund Details 3
• Name
• Investment policy
• Objective
• Target Customer
• Type
• Investment Strategy
3. List of assets and its Justification 7
4. Portfolio 8
5. Asset Allocation Process 9
6. Portfolio Evaluation 12
7. Costs 16
8. Conclusion 18
9. References 19
Introduction
Stratton Group, is a global investment management enterprise that was incorporated
under the Companies Act, 1956, on 21st December, 1997.
We are headquartered at Mumbai, India with offices in all major financial cities in the
world.
Our major services are that of investment management, investment services and wealth
management that help our clients succeed in markets all over the world. We offer a
vast range of financial services to a client base of 78 million customers in more than 72
countries and it includes: corporations,
financial institutions, governments,
and
individuals: saving for a new home, their children's education, their retirement and/or a
higher standard of living.
We believe in investing rationally and contributing to the financial goals of our clients.
Here, we are offering a mutual fund product comprising of sector stocks. Our portfolio
offered consists of Breweries and Distilleries sector stocks.
2
Risk Factors
a) Standard Risk Factors

• Investment in mutual fund is subject to settlement risk, default risk, market risk,
and liquidity risk and there are chances of losing the principal.
• There can be fluctuations in the NAV of the scheme due to changes in market
forces and conditions.
• Past performance of any scheme does not give assurance of its future
performance.
• The sponsor is not responsible for any losses resulting from the scheme, beyond
its initial contribution of Rs 1 lakh.
• As the value of the underlying stocks changes, the investment value may go up
or down.
• Our scheme does not guarantee returns.
b) Scheme-specific Risk Factors

• When there is a huge request for redemption and restructuring of scheme, the
time taken for redemption can be significant.
• Performance of the Scheme may be affected by changes in government policies,
diplomatic conditions, and taxation policies.
• The trading volumes and settlement period restrict the liquidity of the
investment.
Fund Details
Name of Fund Stratton Oakmont Mutual Fund
Liquidity Open-ended.
The purchases and redemptions will be at price to applicable NAV on each
business day.
Benchmark Index Nifty 50
NAV Disclosure The Net Asset Value of the scheme will be updated on every business day
on the company’s website at 9:00 p.m.
The NAV shall also be published, on every business day, in two
newspapers having nationwide circulation.
The monthly portfolio of the scheme will be available on the website on
or before the tenth day of succeeding month.
Investment Policy
3
To achieve the investment objective, the scheme will invest in equity instruments. The
Fund Manager will invest in stocks of the Brewery and Distillery sector, which in
opinion of the manager have the potential to grow.
The selection of stocks will be driven by the growth prospects and valuations of the
business.
Objective of Fund
The investment objective of this scheme is to produce steady long-term capital

appreciation by selecting stocks, which have the potential to outpace the industry. This
fund aims to generate market returns with marginal risk.
Target Customer
Sector funds invest mostly in equity shares of companies in a particular business

sector or industry. These funds are considered extremely risky because the
investments are concentrated on a single sector, which may perform better at certain
times than others. While these funds giver higher returns, they are also more riskier as
compared to the diversified funds.
Therefore these funds are ideal investment vehicle for investors who have a well versed
knowledge about a particular sector and have a high risk appetite.
Type of Fund
An open ended equity scheme:

• The scheme continuously offers new units to the investors.
• An investor will generally purchase shares in the fund directly from the fund
itself rather than from the existing shareholders.
• Issue and redeem shares at any time at Net Asset Value (NAV) related prices
which are declared on a daily basis.
Investment Strategy
a) Short Term
In the short term (<5 years), usually it’s advisable to invest in cash or cash like vehicles,
as the risk is lower. The table shows risk return of the fund as compared to the market.
Nifty Portfolio
Average Annual Return 7.32% 67.00%
Annual SD 16.76% 53.87%
As seen in the table, the portfolio is providing a remarkable return of 67% along with a
risk of 54%.
So, Investors who are looking for high returns and have a high risk appetite can invest
in the fund as it provides returns way higher than the market.
b) Intermediate and Long term (more than 5 years)
4
In the long and intermediate term, the fund aims at
providing capital gains. The main goal is to stay
invested and enjoy compounding of returns.
c)Finance and audit committee

It is important to set up an independent finance and audit committee for better quality
of financial statement and to assist the Board in achieving its obligations and
responsibilities relating to its financial planning and reporting, the audit process, risk
management, the system of corporate controls and when required make
recommendation to the board.
The committee will:

• Review and make recommendations to the board in respect of operating and
capital financial plans and budgets
• Review the financial statements and reports, and give their recommendations
and approval or disapproval to the Board
• Make sure that the company is in accordance with SEBI’s rules and regulation.
• Examine the audited annual financial statements in conjunction with the report
of the External Auditor.
• Also recommend to the full board, the selection process of internal auditors for
the company
d) Investment responsibilities
The main responsibility of a fund manager is to implement a reliable investment strategy

that reflects the goals and objectives of the fund.
They also provide for cost-effective investments by monitoring market and economic trends
and analysing securities in order to make informed investment decisions.
The fund managers should keep in in mind a certain set of responsibilities that they are
required to adhere to in order to fulfill their client’s need, the responsibilities are as
follows:
• The fund managers should adhere to the rules and regulations laid down by the
Securities and Exchange Board of India (SEBI).
The Directors are responsible for the audited financial statements that they
declare. In case of any problems, the fund manager may have to answer the
queries to the directors, investors or even regulators and legislators of the
funds.
• To conduct an in-depth analysis of the market environment, macroeconomic
factors and sectoral outlooks to identify the best investment opportunities.
• They also make the asset allocation and the securities buy and sell decisions
based on the investment objective of the fund.
• The fund managers must guarantee their assets' reporting requirements are met.
• They have a responsibility to safeguard investors' money. The decisions related
to purchase or sell resources are preceded by an investigation and due ingenuity.
5
Fund Managers take additional risk by guaranteeing resource portfolios are
adequately diversified.
List of assets/asset class and justification for selection.

India is the biggest manufacturer of Alcoholic Beverages in the world.
Factors influencing the growth of alcohol industry in India:
• Urbanization: An increasing number of individuals are moving to bigger cities,
where they are exposed to a larger variety of alcoholic products.
• Favorable demographics: India is a country of the youth, with more than 60%
of Indians falling in the 15-45 years’ age group. This is the targeted group of the
industry. The number of Indians who consume alcohol is increasing rapidly over
time.
• Changing social norms: Over time, there has been a change in attitudes of
Indians, making consumption of alcohol more socially acceptable. This
acceptability has extended to drinking in family environments, at social events,
and by females/ youngsters.
• Increase in disposable income: More number of Indians are now moving
towards the upper/middle-income group. This increase in the disposable income
is working favorably for the sector.
• Increased alcohol accessibility and availability: There has been an increase in
the variety of alcohol and it has become more accessible.
6
In past 3-4 years Breweries and Distilleries sector has recorded a CAGR of 7%.
Portfolio
The selection of the stocks is done on the basis of market capitalization of the
companies. The table below show the ranking of the companies based on their market
cap.
Rank Companies
1 United Breweries
2 United Spirits
3 Radico Khaitan
4 GM Breweries
5 Associated Alcohol
United Breweries Limited:

With their flagship brand ‘Kingfisher’, United Breweries Limited has maintained
growth at higher rates than the industry. In the previous financial year, the Company
gained close to 1% market share raising its market share to 51% and it outperformed
its competitors and industry. The industry grew at a rate of 7%, this company recorded
a general development of 7%, aggregating volumes of 147 million cases and finally
justifying its position as the market leader.
United Spirits Limited:
7
Established in 1826, USL caters a variety of drinks from scotch, whiskey, and schnapps to
rum, vodka, gin and wine. Their business in India is anticipated to develop at 8-10% CAGR
throughout in the following 5 years. As a responsible and ethical corporation, the highest
focus point on the list of their strategic goals is the sustainable growth. Consisting of 18
brands in its portfolio offering more than a million cases yearly, 4 of these brands offer more
than 10 million cases yearly. With its headquarters in Bengaluru, USL holds a solid
impression upheld by a 6000+ employees who are committed to satisfy the principal goals
of turning into the best performing and most trusted organization in the country, it trades its
products to over 37 nations worldwide. The net income from activities has seen a growth of
13% in the fiscal year ended 31 st March 2017.
GM Breweries Limited:
G.M. is the biggest producer of liquor in Maharashtra. GM pioneered in introducing pet
bottles and 180 ml bottles to the liquor industry. The revenues saw a rise from Rs.
125,803.83 lakhs in the last year to Rs. 1,35,665.07 lakhs. Since the market conditions have
been nothing but favorable, this has helped to boost the turnover of the company to a total
of 21% increase.
Associated Alcohols & Breweries Limited:

Associated Alcohols & Breweries Limited (AABL) is the under the Rs. 3000 million
liquor consortium, Associated Kedia Group. AABL is present in every point of the
liquor industry value chain. AABL bottles scotch whisky and vodka for major
international brands. The gross turnover for the company was Rs. 29646.53 lakhs for
the financial year 2017.
Radico Khaitan Limited:

Radico Khaitan is amongst the key players of the industry. Radico Khaitan was the first company
that offered scotch blended whisky. It was also a pioneer in positioning 8PM as India's exclusive
whisky. Radico Khaitan runs 3 distilleries, 33 bottling units and1 joint venture. It has a total
capacity of 150 million liters. The net sales for FY2017 were Rs. 1,789.17 crores.
The stock of Radico Khaitan Limited is providing negative annual returns of
-0.10% which in turn is reducing the average returns of the portfolio. So, to optimize
the portfolio and increase the returns, this stock has been excluded even though it has a
high market cap.
Returns with Radico Khaitan Returns without Radico Khaitan

Portfolio(equal weights) 34.15% 42.98%
8
Asset Allocation Process
Asset The asset allocation under the Mutual Fund is stated below:
Allocation
Investments Allocation Risk Profile
Equity Securities 100% Medium to High
Note: The asset allocation is fixed and will not vary under any
circumstances at the sole decision of the Fund Manager.
Asset The asset allocation process was carried out by undertaking a

Allocation simulation process for 3 different time periods. The most efficient
Process asset allocation was found out by the process of review and
rebalancing for the following periods:
A) April 2011- March 2016
B) October 2011- September 2016
C) April 2012-March 2017’
The mutual fund only consists of equity securities and hence, the
simulation only equity was used in the simulation process.
The steps carried out in the simulation process have been stated
below:
STEPS PARTICULARS
STEP 1 The Adjusted Closing Prices (Monthly) for the
respective time periods is collected.
STEP 2 The Holding Period Return (HPR) is calculated for
each month.
STEP 3 The Average Monthly HPR and Standard Deviation,

the Annualized HPR and Standard Deviation is
calculated for each equity stock for every time period.
STEP 4 Using Data Analysis, the VAR-COVAR Matrix is

calculated, using the HPRs of the stocks. This
matrix indicates the correlation of each stock with the
others in the respective time period.
9
STEP 5 The Bordered VAR-COVAR matrix is constructed.
The individual values of the matrix is calculated by
multiplying the correlation with the respective
weights of the 2 stocks. The initial weights assigned
are equal for each stock. ( Since the 1 st period
consists of 5 stocks, the weights assigned are 0.2 for
each stock)
STEP 6 The Total Variance is calculated by adding all the
individual variances of the stocks. The monthly and
annualized standard deviation is calculated using the
total variance of the portfolio.
The annualized portfolio return is calculated with the
help of the excel function =SUMPRODUCT, in
which the 1st Array consists of the weights assigned
to each stock and the 2 nd Array is the annualized
returns of each stock.
STEP 7 The Solver Function, available in the Data Analysis
of Excel Tab, is used to calculate the Efficient
Frontier of Risk V/S Risk. The set objective under
Solver is to minimize the Total Variance by changing
weights assigned to each stock. The
objective of the solver is calculate the minimum risk
for the given level of portfolio return. For 5 stocks the
solver will contain 12 constraints and for a
portfolio of 4 stocks there will be 10 constraints.
Since the weights that can be assigned to each stock
is between 0 and 1, each stock will have 2
constraints for this fact. One constraint will explain
that the sum of weights assigned is equal to one. The
last constraint contain the different yearly portfolio
returns. There are ten scenarios which contain ten
different Yearly Portfolio returns. The Ten different
yearly returns is calculated by differentiating the
Highest and Lowest returns form the stocks and
diving it by 10.
STEP 8 Each scenario is saved in the What-If Analysis under
the Data Tab of Excel. The Scenario Pivot-
Table Report is created with the help of summary tab
under What-If Analysis. The Pivot-Table shows the
yearly portfolio Risk and Returns under each
scenario.
STEP 9 The Efficient Frontier Graph is created selecting the
Risk and Return data available in the Pivot-Table and
inserting a Scatter Chart.
10
STEP 10 The Capital Market Line (CML) is generated on the
Efficient Frontier Graph with the help of the
annualized returns and risk of the Risk Free asset
(SBI 1 year Fixed Deposit Interest Rate) and the
annualized returns and risk of the Market (NIFTY
50)
STEP 11 With the help of the CML, the most optimal
Portfolios are found out and the Sharpe Ratio of
each of these portfolios is calculated. Using the
Sharpe Ratio, the portfolio with the highest average
return in excess of the risk free rate of return per unit
of the Total risk undertaken is found out. So, the
portfolio with the highest Sharpe Ratio is selected.
STEP 12 The portfolio is reviewed and rebalanced twice by
changing the time periods and repeating the whole
process to find the optimum efficient frontiers.
11
Portfolio Evaluation
Stocks Evaluation:
1. April 2011-March 2016
(United Breweries, United Distilleries, Assoc Alcohol, GM Breweries)
Weights Assigned
Assoc
United United Alcoho GM Sharpe
Risk Return Breweries Spirits l Breweries Ratio
Iteration 1 67.46% 69.72% 0.0000 0.0000 0.2108 0.7892 0.9090
Iteration 2 55.67% 63.94% 0.0000 0.0000 0.4217 0.5783 0.9977
Iteration 3 47.95% 58.16% 0.0000 0.1123 0.4487 0.4390 1.0377
Iteration 4 42.09% 52.38% 0.0219 0.2286 0.4231 0.3264 1.0448
Iteration 5 37.47% 46.60% 0.1640 0.2103 0.3644 0.2614 1.0195
Iteration 6 33.74% 40.82% 0.3055 0.1924 0.3062 0.1960 0.9609
Iteration 7 31.23% 35.04% 0.4473 0.1742 0.2477 0.1308 0.8531
Iteration 8 30.24% 29.26% 0.5891 0.1561 0.1892 0.0656 0.6898
Iteration 9 30.92% 23.48% 0.7311 0.1377 0.1307 0.0005 0.4877
Iteration 10 34.23% 17.70% 0.9997 0.0003 0.0000 0.0000 0.2717
NIFTY Risk Free

Asset
12
Average Annual 16.76% 0
SD
Average Annual
Return 7.32% 8.400%
The Capital Market Line indicated by the Orange Straight line on the Graph is created
with the help of Average Annual Standard Deviation and return of the NIFTY (Market)
and the Risk Free Asset (SBI 1-year Fixed Deposit Rate). It is the intersection of the
returns from the risk free asset and market returns. The CML is used to find the most
efficient and optimal portfolio. All the Portfolios above the CML are over-valued,
which means that they are a providing a higher return, than the market and the risk free
asset, for the risk undertaken.
Since, the entire curve of the Efficient Frontier lies above the Capital Market Line, and
thus, the Sharpe ratio of all the Portfolio Iterations is needed to be calculated. The
Iteration with the highest Sharpe Ratio will be chosen as the most optimal portfolio.
This is the criteria of selection for all the three periods.
The Iteration 4 has the highest Sharpe Ratio (1.0448) with Average Yearly Portfolio
Return of 52.38%, which is significantly higher than the Market Return (7.32%) and
the Average Annualized Standard Deviation of 42.09%. The Sharpe Ratio is positive
indicating that the portfolio gave higher returns than the risk free rate of return for the
subsequent risk taken.
2. October 2011-September 2016 (United Breweries, United Distilleries, Assoc Alcohol,

GM Breweries)
Weights
United
Brewerie United Assoc GM Sharpe
Risk Return s Spirits Alcohol Breweries Ratio
Iteration 1 63.95% 73.98% 0.0000 0.0000 0.2761 0.7239 1.0243
Iteration 2 51.82% 68.08% 0.0000 0.0150 0.5195 0.4655 1.1502
Iteration 3 45.02% 62.18% 0.0000 0.1601 0.4788 0.3611 1.1929
Iteration4 39.88% 56.28% 0.0636 0.2295 0.4280 0.2789 1.1987
Iteration 5 35.55% 50.38% 0.2004 0.2116 0.3656 0.2224 1.1786
Iteration 6 32.03% 44.48% 0.3373 0.1936 0.3032 0.1659 1.1240
Iteration 7 29.60% 38.58% 0.4742 0.1757 0.2408 0.1093 1.0170
Iteration 8 28.54% 32.68% 0.6110 0.1578 0.1783 0.0528 0.8480
Iteration 9 29.01% 26.78% 0.7522 0.1367 0.1112 0.0000 0.6310
Iteration 10 31.89% 20.92% 0.9998 0.0002 0.0000 0.0000 0.3902
13
NIFTY Risk Free Asset
Annual SD 15.75% 0
The entire efficient curve is above the Capital Market Line, so the Sharpe ratio of all
the {portfolio Iterations is needed to calculated, to find the most efficient portfolio.
Portfolio Iteration 4 has the highest Sharpe Ratio of 1.1987. It gave an average
annualized return of 56.28% with an average annualized standard deviation (risk) of
39.88%. This portfolio has a high Sharpe ratio, as it is giving a much higher return when
compared to the risk free return (8.475%) and at a risk (SD) which is much lower than
the annualized returns. The Sharpe Ratio is clear indication that the Portfolio was able
to perform well in the market for the respective period.
14
3. April 2012-March 2017
(United Breweries, United Distilleries, Assoc Alcohol, GM Breweries)
NIFTY Risk free Rate

Annual Return 12.21% 8.00%
Average Annual SD 14.26% 0
The Graph clearly portrays that The Capital Market Line is cutting the Efficient
Frontier just below the Portfolio Iteration 9 and just above the 10 th Iteration. Hence,
the 10th Iteration is not taken into consideration, as it is not an efficient portfolio and
hence, the Sharpe Ratio for all the other Portfolio Iterations is calculated. Iteration 1
has the highest Sharpe Ratio of 1.8087 and an average annualized return of 68.26%
15
and an average annualized standard deviation of 33.32%. The weights are assigned to
only two companies, which are United Breweries (7.86%) and Assoc Alcohol
(92.14%), as they are providing the highest risk-adjusted return.
Costs
Expense ratio: It means the cost an investment company has to incur to manage the
funds.
It is calculated through yearly calculations in which a funds operating expenditures are
divided by the average rupee rate of its asset. The following are the expenses that the
investment company incurs to operate this scheme:
(This include all the expenses that the company incurs including marketing and
advertising costs)
Investment & Advisory Fees

Trustee Fees
Cost Related to investor
Communication
Service tax on expenses other than
investment fees
Registrar & Transfer Agents Fees
Marketing & Selling Expense Up to 2.1%
Audit fees
Cost of Funds Transfer
Cost Towards investor education
Service tax on brokerage
Brokerage & transaction cost
Custodian Fees
Cost of Statutory Advertisements
Other Expenses
Additional Expenses under regulations
Additional Expenses for gross new
inflows from specified cities
Exit Loads are fees/penalty charged by the mutual fund when the investor leaves a
fund. It is deducted from the NAV (Net Asset Value). The money received from exit
loads do not go in the fund but rather to the asset management company. The main
objective of this fund is to discourage investors from withdrawing their money from the
fund.
Exit Load are charged:
If the funds are redeemed before 30 days Exit Load: 0.20%

from the date of allotment
If the funds are redeemed before 182 days Exit Load: 2.15%
16
If the funds are redeemed after 182 days Exit load: 1.05%
up to 365 days from the date of allotment
If the funds are redeemed after 365 days Exit Load: 0%

Portfolio managers’ background

Pragya Goyal is one of the key managing partners in Stratton Group.
She completed her MBA in wealth management from INSEAD. She has worked with
Barclays for a period of 26 months in wealth management and then worked as a fund
manager in “Morning star”, a multi-billion-asset management company for 3 years.
Pranav Agarwal has done his MBA in finance from Indian Institute of Management,
Ahmedabad. He is the fund manager of Stratton Group. He has worked in Goldman
Sachs as a fund manager for 5 years. He has a degree in CFA (chartered Financial
Analyst)
Preksha Parmar is the equity analyst in Stratton Group. She has done her MBA in
finance from Wharton Business School and was the faculty head on the board of
Stanford Graduate School of Business. She has a degree in CFA (chartered Financial
Analyst)
Prithu Chawla has been working in the portfolio management for the past 7 years. He
completed his MBA from Harvard School of business and did his Ph.D. in the field of
finance from M.I.T. (Massachusetts institute of technology). He worked for 3 years in
BlackRock, U.S. as an assistant fund manager and 2 years in Vanguard Group, U.S.
Priyal Sangal has done her MBA from Yale School of Management, New Haven. She
worked at ICICI bank in Wealth management for 2 years and in Reliance mutual funds
for 3 years.
17
Conclusion
From the analysis done, it can be seen that the returns the fund is providing in all the
three investment periods is high as compared to the market returns in spite of the
stringent government restrictions and local tax laws.
Sharpe ratio for the portfolio, which has three cycles April 2011- March 2016, October
2011-September 2016, April 2012-March 2017, are 1.0448, 1.1987, and 1.8087
respectively.
Investors with a high risk-return investment objective can opt for this sector specific
mutual fund. The Brewery & Distillery Industry in India has seen a steady growth in
the past few years due to the change in the lifestyle of the consumers in India.
The Indian Brewery & Distillery Industry is one of the fastest growing and
upcoming industries in the world with numerous unexplored segments. In the coming
years several international players will expand their operations into the Indian alcoholic
drinks market due to the economies of scale poised by the market and the compelling
business potential. Therefore, investing in this mutual fund would give high returns in
the coming years.
18
References
1.https://investment.prudential.com/util/common/get?file=CB502C80C4A99D6F852
57B7D00527563
2. http://www.investopedia.com/
3. http://www.ngeninvest.com/breweries--distilleries
4. https://www.sbimf.com/en-us/lists/sid_kim/sid%20-
%20sbi%20savings%20fund.pdf
5. https://in.investing.com/
6. https://in.finance.yahoo.com/
7. http://www.moneycontrol.com/
8. http://www.financialexpress.com/industry/indian-alcoholic-beverages-marketoutlook-to-
2020-inflating-demand-for-imfl-and-beer-from-youth-and-women-
segments/114327/
9.http://www.hdfcfund.com/CMT/UPLOAD/ARTICLEATTACHMENTS/HDFC_Ba
lanced_Fund_SID_Apr_17.pdf
10. http://www.sebi.gov.in/sebi_data/attachdocs/1315910593619.pdf
11. https://assetmanagement.kotak.com/documents/19/e4b772f8-ddad-4e09-
8d88ee213fd5a8f0
12. http://www.moneycontrol.com/annual-
report/unitedbreweries/directorsreport/UB02#UB02
19
SafeAssign Originality Report 25/09/17, 11*09 PM
INVESTMENT ANALYSIS AND PORTFOLIO MANAGEMENT

1
NAME OF THE FUND: Stratton Oakmont Mutual Fund
https://blackboard.svkm.ac.in/webapps/mdb-sa-BBLEARN/originalit…4597-8b78-c99ba3a4bbdf&includeDeleted=true&course_id=_29612_1# Page 1 of 14
2 DATE OF SUBMISSION: 25th September, 2017
SYBBA- E (Group 5):
Roll No. 21 Roll No. 22 Roll No. 23 Roll No. 24 Roll No. 25
Pragya Goyal Pranav Agarwal Preksha Parmar Prithu Chawla Priyal Sangal
3 TABLE OF CONTENTS
1. Introduction 3
2. Fund Details 3 · Name · Investment policy · Objective · Target Customer · Type · Investment Strategy
3. List of assets and its Justification 7
4. Portfolio 8
5. 4 ASSET ALLOCATION PROCESS 9
6. 5 PORTFOLIO EVALUATION 12
7. Costs 16
8. Conclusion 18 9. References 19
Introduction
Stratton Group, is a global investment management enterprise that was incorporated under the Companies Act, 1956
on 21st December, 1997.
We are headquartered at Mumbai, India with offices in all major financial cities in the world.
Our major services are that of investment management, investment services and wealth management that help our
clients succeed in markets all over the world.
We offer a vast range of financial services to a client base of 78 million customers in more than 72 countries and it
includes:
corporations, financial institutions, governments, and individuals: saving for a new home, their children's education
their retirement and/or a higher standard of living.
We believe in investing rationally and contributing to the financial goals of our clients.
Here, we are offering a mutual fund product comprising of sector stocks. Our portfolio offered consists of Breweries
https://blackboard.svkm.ac.in/webapps/mdb-sa-BBLEARN/originalit…4597-8b78-c99ba3a4bbdf&includeDeleted=true&course_id=_29612_1#
and Distilleries sector stocks.
Risk Factors
Page 2 of 14
6 A) STANDARD RISK FACTORS · INVESTMENT IN MUTUAL FUND IS SUBJECT TO SETTLEMEN

T
RISK, DEFAULT RISK, MARKET RISK, AND LIQUIDITY RISK AND THERE ARE CHANCES OF
LOSING THE PRINCIPAL.
· There can be fluctuations in the NAV of the scheme due to changes in market forces and conditions.
6 · PAST PERFORMANCE OF ANY SCHEME DOES NOT GIVE ASSURANCE OF ITS FUTURE
PERFORMANCE.
· THE SPONSOR IS NOT RESPONSIBLE FOR ANY LOSSES RESULTING FROM THE SCHEME,
BEYOND ITS INITIAL CONTRIBUTION OF RS 1 LAKH.
· As the value of the underlying stocks changes, the investment value may go up or down.
· Our scheme does not guarantee returns.
b) Scheme-specific Risk Factors · When there is a huge request for redemption and restructuring of scheme, the time
taken for redemption can be significant.
7 · PERFORMANCE OF THE SCHEME MAY BE AFFECTED BY CHANGES IN GOVERNMENT
POLICIES, DIPLOMATIC CONDITIONS, AND TAXATION POLICIES.
8 · THE TRADING VOLUMES AND SETTLEMENT PERIOD RESTRICT THE LIQUIDITY OF THE
INVESTMENT.
Fund Details
Name of Fund Stratton Oakmont Mutual Fund
Liquidity Open-ended.
The purchases and redemptions will be at price to applicable NAV on each business day.
9 BENCHMARK INDEX NIFTY 50
NAV Disclosure The Net Asset Value of the scheme will be updated on every business day on the company’s website
9:00 p.m.
The NAV shall also be published, on every business day, in two newspapers having nationwide circulation.
The monthly portfolio of the scheme will be available on the website on or before the tenth day of succeeding month.
Investment Policy To achieve the investment objective, the scheme will invest in equity instruments. The Fund
Manager will invest in stocks of the Brewery and Distillery sector, which in opinion of the manager have the potentia
to grow.
6 THE SELECTION OF STOCKS WILL BE DRIVEN BY THE GROWTH PROSPECTS AND
VALUATIONS OF THE BUSINESS.
1 OBJECTIVE OF FUND
The investment objective of this scheme is to produce steady long-term capital appreciation by selecting stocks, whic
have the potential to outpace the industry. This fund aims to generate market returns with marginal risk.
Target Customer
Sector funds invest mostly in equity shares of companies in a particular business sector or industry. These funds are
considered extremely risky because the investments are concentrated on a single sector, which may perform better a
certain times than others. While these funds giver higher returns, they are also more riskier as compared to the
diversified funds.
6 THEREFORE THESE FUNDS ARE IDEAL INVESTMENT VEHICLE FOR INVESTORS WHO HAVE
A WELL VERSED KNOWLEDGE ABOUT A PARTICULAR SECTOR AND HAVE A HIGH RISK
APPETITE.
1 TYPE OF
FUND
10 AN OPEN
ENDED EQUITY
SCHEME:
· The scheme continuously offers new units to the investors.
· An investor will generally purchase shares in the fund directly from the fund itself rather than from the existing
shareholders.
· Issue and redeem shares at any time at Net Asset Value (NAV) related prices which are declared on a daily basis.
Investment Strategy
a) Short Term In the short term (<5 years), usually it’s advisable to invest in cash or cash like vehicles, as the risk
is lower. The table shows risk return of the fund as compared to the market.
Nifty Portfolio
Annual SD 16.76% 53.87%
As seen in the table, the portfolio is providing a remarkable return of 67% along with a risk of 54%.
So, Investors who are looking for high returns and have a high risk appetite can invest in the fund as it provides
returns way higher than the market.
b) Intermediate and Long term (more than 5 years) In the long and intermediate term, the fund aims at
providingcapital gains. The main goal is to stay invested and enjoy compounding of returns.
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c)Finance and audit committee It is important to set up an independent finance and audit committee for better quality
of financial statement and to assist the Board in achieving its obligations and responsibilities relating to its financial
planning and reporting, the audit process, risk management, the system of corporate controls and when required
make recommendation to the board.
The committee will:
· Review and make recommendations to the board in respect of operating and capital financial plans and budgets ·
Review the financial statements and reports, and give their recommendations and approval or disapproval to the
Board · Make sure that the company is in accordance with SEBI’s rules and regulation.
· Examine the audited annual financial statements in conjunction with the report of the External Auditor.
· Also recommend to the full board, the selection process of internal auditors for the company
D) INVESTMENT RESPONSIBILITIES
11
The main responsibility of a fund manager is to implement a reliable investment strategy that reflects the goals and
objectives of the fund.
They also provide for cost-effective investments by monitoring market and economic trends and analysing securities
in order to make informed investment decisions.
1 THE FUND MANAGERS SHOULD KEEP IN IN MIND A CERTAIN SET OF RESPONSIBILITIES
THAT THEY ARE REQUIRED TO ADHERE TO IN ORDER TO FULFILL THEIR CLIENT’S NEED, THE
RESPONSIBILITIES ARE AS FOLLOWS:
7 · THE FUND MANAGERS SHOULD ADHERE TO THE RULES AND REGULATIONS LAID DOWN
BY THE SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI).
1 THE DIRECTORS ARE RESPONSIBLE FOR THE AUDITED FINANCIAL STATEMENTS THAT
THEY DECLARE. 7 IN CASE OF ANY PROBLEMS, THE FUND MANAGER MAY HAVE TO ANSWER
THE QUERIES TO THE DIRECTORS, INVESTORS OR EVEN REGULATORS AND LEGISLATORS OF
THE FUNDS.
· To conduct an in-depth analysis of the market environment, macroeconomic factors and sectoral outlooks to identify
the best investment opportunities.
· They also make the asset allocation and the securities buy and sell decisions based on the investment objective of th
fund.
1 · THE FUND MANAGERS MUST GUARANTEE THEIR ASSETS' 7 REPORTING REQUIREMENTS

ARE MET.
· THEY HAVE A RESPONSIBILITY TO SAFEGUARD INVESTORS' 7 THE DECISIONS

money.
RELATED TO PURCHASE OR SELL RESOURCES ARE PRECEDED BY AN INVESTIGATION AND
DUE INGENUITY. 1 FUND MANAGERS TAKE ADDITIONAL RISK BY GUARANTEEING RESOURCE
PORTFOLIOS ARE ADEQUATELY DIVERSIFIED.
12 LIST OF ASSETS/ASSET CLASS AND JUSTIFICATION FOR SELECTION.
India is the biggest manufacturer of Alcoholic Beverages in the world.
Factors influencing the growth of alcohol industry in India:
· Urbanization: An increasing number of individuals are moving to bigger cities, where they are exposed to a larger
variety of alcoholic products.
· Favorable demographics: India is a country of the youth, with more than 60% of Indians falling in the 15-45 years’
age group. This is the targeted group of the industry. The number of Indians who consume alcohol is increasing
rapidly over time.
· Changing social norms: Over time, there has been a change in attitudes of Indians, making consumption of alcohol
more socially acceptable. This acceptability has extended to drinking in family environments, at social events, and by
females/ youngsters.
· Increase in disposable income: More number of Indians are now moving towards the upper/middle-income group.
This increase in the disposable income is working favorably for the sector.
· Increased alcohol accessibility and availability: There has been an increase in the variety of alcohol and it has become
more accessible.
In past 3-4 years Breweries and Distilleries sector has recorded a CAGR of 7%.
Portfolio The selection of the stocks is done on the basis of market capitalization of the companies. The table below
show the ranking of the companies based on their market cap.
Rank Companies
1 United Breweries
2 United Spirits
3 Radico Khaitan
4 GM Breweries
5 Associated Alcohol
United Breweries Limited:
With their flagship brand ‘Kingfisher’, United Breweries Limited has maintained growth at higher rates than the
industry. In the previous financial year, the Company gained close to 1% market share raising its market share to 51%
and it outperformed its competitors and industry. The industry grew at a rate of 7%, this company recorded a genera
development of 7%, aggregating volumes of 147 million cases and finally justifying its position as the market leader.
United Spirits Limited:
Established in 1826, USL caters a variety of drinks from scotch, whiskey, and schnapps to rum, vodka, gin and wine.
Their business in India is anticipated to develop at 8-10% CAGR throughout in the following 5 years. As a responsibl
and ethical corporation, the highest focus point on the list of their strategic goals is the sustainable growth. Consistin
of 18 brands in its portfolio offering more than a million cases yearly, 4 of these brands offer more than 10 million
cases yearly. With its headquarters in Bengaluru, USL holds a solid impression upheld by a 6000+ employees who are
committed to satisfy the principal goals of turning into the best performing and most trusted organization in the
country, it trades its products to over 37 nations worldwide. The net income from activities has seen a growth of 13%
in the fiscal year ended 31st March 2017.
GM Breweries Limited:
G.M. is the biggest producer of liquor in Maharashtra. GM pioneered in introducing pet bottles and 180 ml bottles to
the liquor industry. The revenues saw a rise from Rs. 125,803.83 lakhs in the last year to Rs. 1,35,665.07 lakhs. Since
the market conditions have been nothing but favorable, this has helped to boost the turnover of the company to a total
of 21% increase.
Associated Alcohols & Breweries Limited:
Associated Alcohols & Breweries Limited (AABL) is the under the Rs. 3000 million liquor consortium, Associated
Kedia Group. AABL is present in every point of the liquor industry value chain. AABL bottles scotch whisky and vodka
for major international brands. The gross turnover for the company was Rs. 29646.53 lakhs for the financial year
2017.
Radico Khaitan Limited:
Radico Khaitan is amongst the key players of the industry. Radico Khaitan was the first company that offered scotch
blended whisky. It was also a pioneer in positioning 8PM as India's exclusive whisky. Radico Khaitan runs 3
distilleries, 33 bottling units and1 joint venture. It has a total capacity of 150 million liters. The net sales for FY2017
were Rs. 1,789.17 crores.
The stock of Radico Khaitan Limited is providing negative annual returns of -0.10% which in turn is reducing the
average returns of the portfolio. So, to optimize the portfolio and increase the returns, this stock has been excluded
even though it has a high market cap.
Returns with Radico Khaitan Returns without Radico Khaitan
Portfolio(equal weights) 34.15% 42.98%
Asset Allocation Process Asset Allocation The asset allocation under the Mutual Fund is stated below:
Investments Allocation Risk Profile

7 EQUITY SECURITIES 100% MEDIUM TO HIGH
Note: The asset allocation is fixed and will not vary under any circumstances at the sole decision of the Fund Manager.
Asset Allocation Process The asset allocation process was carried out by undertaking a simulation process for 3
different time periods. The most efficient asset allocation was found out by the process of review and rebalancing for
the following periods:
A) April 2011- March 2016 B) October 2011- September 2016 C) April 2012-March 2017’
The mutual fund only consists of equity securities and hence, the simulation only equity was used in the simulation
process.
The steps carried out in the simulation process have been stated below:
STEPS PARTICULARS
11 STEP 1 THE ADJUSTED CLOSING PRICES (MONTHLY) FOR THE RESPECTIVE TIME PERIODS
I
COLLECTED.
STEP 2 THE HOLDING PERIOD RETURN (HPR) IS CALCULATED FOR EACH MONTH.
STEP 3 THE AVERAGE MONTHLY HPR AND STANDARD DEVIATION, THE ANNUALIZED HPR
AND STANDARD DEVIATION IS CALCULATED FOR EACH EQUITY STOCK FOR EVERY TIME
PERIOD.
STEP 4 Using Data Analysis, the VAR-COVAR Matrix is calculated, using the HPRs of the stocks. This matrix
indicates the correlation of each stock with the others in the respective time period.
STEP 5 The Bordered VAR-COVAR matrix is constructed. 11 THE INDIVIDUAL VALUES OF THE MATRIX I
CALCULATED BY MULTIPLYING THE CORRELATION WITH THE RESPECTIVE WEIGHTS OF THE
2 STOCKS. The initial weights assigned are equal for each stock. ( Since the 1st period consists of 5 stocks, the
weights assigned are 0.2 for each stock)
STEP 6 The Total Variance is calculated by adding all the individual variances of the stocks. The monthly and
annualized standard deviation is calculated using the total variance of the portfolio.
The annualized portfolio return is calculated with the help of the excel function =SUMPRODUCT, in which the 1st
Array consists of the weights assigned to each stock and the 2nd Array is the annualized returns of each stock.
13 STEP 7 THE SOLVER FUNCTION, AVAILABLE IN THE DATA ANALYSIS OF EXCEL TAB, IS USE
D
TO CALCULATE THE EFFICIENT FRONTIER OF RISK V/S RISK. The set objective under Solver is
to
minimize the Total Variance by changing weights assigned to each stock. 14 THE OBJECTIVE OF THE SOLVE
R
IS CALCULATE THE MINIMUM RISK FOR THE GIVEN LEVEL OF PORTFOLIO RETURN. For 5
stocks the solver will contain 12 constraints and for a portfolio of 4 stocks there will be 10 constraints.
Since the weights that can be assigned to each stock is between 0 and 1, each stock will have 2 constraints for this fac
One constraint will explain that the sum of weights assigned is equal to one. The last constraint contain the different
yearly portfolio returns. There are ten scenarios which contain ten different Yearly Portfolio returns. The Ten
different yearly returns is calculated by differentiating the Highest and Lowest returns form the stocks and diving it
by 10.
STEP 8 Each scenario is saved in the What-If Analysis under the Data Tab of Excel. The Scenario Pivot-Table Report
is created with the help of summary tab under What-If Analysis. The Pivot-Table shows the yearly portfolio Risk and
Returns under each scenario.
STEP 9 The Efficient Frontier Graph is created selecting the Risk and Return data available in the Pivot-Table and
inserting a Scatter Chart.
STEP 10 The Capital Market Line (CML) is generated on the Efficient Frontier Graph with the help of the annualized
returns and risk of the Risk Free asset (SBI 1 year Fixed Deposit Interest Rate) and the annualized returns and risk o
the Market (NIFTY 50)
STEP 11 With the help of the CML, the most optimal Portfolios are found out and the Sharpe Ratio of each of these
portfolios is calculated. 15 USING THE SHARPE RATIO, THE PORTFOLIO WITH THE HIGHEST
AVERAGE RETURN IN EXCESS OF THE RISK FREE RATE OF RETURN PER UNIT OF THE TOTAL
RISK UNDERTAKEN IS FOUND OUT. 16 SO, THE PORTFOLIO WITH THE HIGHEST SHARPE
RATIO IS SELECTED.
11 STEP 12 THE PORTFOLIO IS REVIEWED AND REBALANCED TWICE BY CHANGING THE TIME
PERIODS AND REPEATING THE WHOLE PROCESS TO FIND THE OPTIMUM EFFICIENT
FRONTIERS.
PORTFOLIO EVALUATION STOCKS EVALUATION:
1. April 2011-March 2016 (United Breweries, United Distilleries, Assoc Alcohol, GM Breweries) Weights
Assigned
Risk Return United Breweries United Spirits Assoc Alcohol GM Breweries Sharpe Ratio
Iteration 1 67.46% 69.72% 0.0000 0.0000 0.2108 0.7892 0.9090
Iteration 2 55.67% 63.94% 0.0000 0.0000 0.4217 0.5783 0.9977
Iteration 3 47.95% 58.16% 0.0000 0.1123 0.4487 0.4390 1.0377
Iteration 4 42.09% 52.38% 0.0219 0.2286 0.4231 0.3264 1.0448
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Iteration 5 37.47% 46.60% 0.1640 0.2103 0.3644 0.2614 1.0195
Iteration 6 33.74% 40.82% 0.3055 0.1924 0.3062 0.1960 0.9609
Iteration 7 31.23% 35.04% 0.4473 0.1742 0.2477 0.1308 0.8531
Iteration 8 30.24% 29.26% 0.5891 0.1561 0.1892 0.0656 0.6898
Iteration 9 30.92% 23.48% 0.7311 0.1377 0.1307 0.0005 0.4877
Iteration 10 34.23% 17.70% 0.9997 0.0003 0.0000 0.0000 0.2717
The Capital Market Line indicated by the Orange Straight line on the Graph is created with the help of Average
Annual Standard Deviation and return of the NIFTY (Market) and the Risk Free Asset (SBI 1-year Fixed Deposit
Rate). It is the intersection of the returns from the risk free asset and market returns. The CML is used to find the
most efficient and optimal portfolio. All the Portfolios above the CML are over-valued, which means that they are a
providing a higher return, than the market and the risk free asset, for the risk undertaken.
Since, the entire curve of the Efficient Frontier lies above the Capital Market Line, and thus, the Sharpe ratio of all th
Portfolio Iterations is needed to be calculated. 16 THE ITERATION WITH THE HIGHEST SHARPE RATIO
WILL BE CHOSEN AS THE MOST OPTIMAL PORTFOLIO.
This is the criteria of selection for all the three
periods.
The Iteration 4 has the highest Sharpe Ratio (1.0448) with Average Yearly Portfolio Return of 52.38%, which is
significantly higher than the Market Return (7.32%) and the Average Annualized Standard Deviation of 42.09%. 11
THE SHARPE RATIO IS POSITIVE INDICATING THAT THE PORTFOLIO GAVE HIGHER RETURNS
THAN THE RISK FREE RATE OF RETURN FOR THE SUBSEQUENT RISK TAKEN.
2. October 2011-September 2016 (United Breweries, United Distilleries, Assoc Alcohol, GM Breweries) Weights
Iteration 1 63.95% 73.98% 0.0000 0.0000 0.2761 0.7239 1.0243
Iteration 2 51.82% 68.08% 0.0000 0.0150 0.5195 0.4655 1.1502 Iteration
3 45.02% 62.18% 0.0000 0.1601 0.4788 0.3611 1.1929
Iteration4 39.88% 56.28% 0.0636 0.2295 0.4280 0.2789 1.1987
Iteration 5 35.55% 50.38% 0.2004 0.2116 0.3656 0.2224 1.1786
Iteration 6 32.03% 44.48% 0.3373 0.1936 0.3032 0.1659 1.1240
Iteration 7 29.60% 38.58% 0.4742 0.1757 0.2408 0.1093 1.0170
Iteration 8 28.54% 32.68% 0.6110 0.1578 0.1783 0.0528 0.8480
Iteration 9 29.01% 26.78% 0.7522 0.1367 0.1112 0.0000 0.6310
Iteration 10 31.89% 20.92% 0.9998 0.0002 0.0000 0.0000 0.3902
Annual SD 15.75% 0
The entire efficient curve is above the Capital Market Line, so the Sharpe ratio of all the {portfolio Iterations is needed
to calculated, to find the most efficient portfolio. Portfolio Iteration 4 has the highest Sharpe Ratio of 1.1987. It gave
an average annualized return of 56.28% with an average annualized standard deviation (risk) of 39.88%. This
portfolio has a high Sharpe ratio, as it is giving a much higher return when compared to the risk free return (8.475%)
and at a risk (SD) which is much lower than the annualized returns. The Sharpe Ratio is clear indication that the
Portfolio was able to perform well in the market for the respective period.
3. April 2012-March 2017 (United Breweries, United Distilleries, Assoc Alcohol, GM Breweries) Weights
Iteration 1 33.32% 68.26% 0.0786 0.0000 0.9214 0.0000 1.8087
3 31.55% 55.84% 0.2832 0.0000 0.7168 0.0000 1.5163
5 29.68% 43.42% 0.4878 0.0000 0.5122 0.0000 1.1933
Iteration 6 28.70% 37.21% 0.5901 0.0000 0.4099 0.0000 1.0177
Iteration 7 27.69% 31.00% 0.6924 0.0000 0.3076 0.0000 0.8308
Iteration 8 26.63% 24.79% 0.7947 0.0000 0.2053 0.0000 0.6305
Iteration 9 25.53% 18.58% 0.8970 0.0000 0.1030 0.0000 0.4143
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Iteration 10 24.39% 12.37% 0.9993 0.0000 0.0007 0.0000
NIFTY Risk free Rate

Page 11 of 14
Annual Return 12.21% 8.00%
The Graph clearly portrays that The Capital Market Line is cutting the Efficient Frontier just below the Portfolio
Iteration 9 and just above the 10th Iteration. Hence, the 10th Iteration is not taken into consideration, as it is not an
efficient portfolio and hence, the Sharpe Ratio for all the other Portfolio Iterations is calculated. Iteration 1 has the
highest Sharpe Ratio of 1.8087 and an average annualized return of 68.26% and an average annualized standard
deviation of 33.32%. The weights are assigned to only two companies, which are United Breweries (7.86%) and Asso
Alcohol (92.14%), as they are providing the highest risk-adjusted return.
4 COSTS EXPENSE RATIO: It means the cost an investment company has to incur to manage the funds.
EXPENDITURES ARE DIVIDED BY THE AVERAGE RUPEE RATE OF ITS ASSET.

1 IT IS CALCULATED THROUGH YEARLY CALCULATIONS IN WHICH A FUNDS OPERATING
The following are the expenses that the investment company incurs to operate this scheme:
(This include all the expenses that the company incurs including marketing and advertising costs)
1 INVESTMENT & ADVISORY FEES
2 UP TO 2.1%
Trustee Fees
1 COST RELATED TO INVESTOR COMMUNICATION
SERVICE TAX ON EXPENSES OTHER THAN INVESTMENT FEES
REGISTRAR & TRANSFER AGENTS FEES
MARKETING & SELLING EXPENSE
Audit fees
COST OF FUNDS TRANSFER
1
COST TOWARDS INVESTOR EDUCATION
SERVICE TAX ON BROKERAGE
BROKERAGE & TRANSACTION COST
Custodian Fees
1 COST OF STATUTORY ADVERTISEMENTS

Other Expenses
1 ADDITIONAL EXPENSES UNDER REGULATIONS
ADDITIONAL EXPENSES FOR GROSS NEW INFLOWS FROM SPECIFIED CITIES
Exit Loads are fees/penalty charged by the mutual fund when the investor leaves a fund. 1 IT IS DEDUCTED
FROM THE NAV (NET ASSET VALUE). 17 THE MONEY RECEIVED FROM EXIT LOADS DO NOT GO
IN THE FUND BUT RATHER TO THE ASSET MANAGEMENT COMPANY. 1 THE MAIN OBJECTIVE
OF THIS FUND IS TO DISCOURAGE INVESTORS FROM WITHDRAWING THEIR MONEY FROM
THE FUND.
Exit Load are charged:
LOAD:
1 IF THE FUNDS ARE REDEEMED BEFORE 30 DAYS FROM THE DATE OF ALLOTMENT EXIT
0.20%
LOAD:
1 IF THE FUNDS ARE REDEEMED BEFORE 182 DAYS FROM THE DATE OF ALLOTMENT EXIT
2.15%
ALLOTMENT EXIT LOAD:

15 IF THE FUNDS ARE REDEEMED AFTER 182 DAYS UP TO 365 DAYS FROM THE DATE OF
1.05%
LOAD:
1 IF THE FUNDS ARE REDEEMED AFTER 365 DAYS FROM THE DATE OF ALLOTMENT EXIT
0%
Portfolio managers’ background Pragya Goyal is one of the key managing partners in Stratton Group.
4 SHE COMPLETED HER MBA IN WEALTH MANAGEMENT FROM INSEAD. She has
worked with Barclays
for a period of 26 months in wealth management and then worked as a fund manager in “Morning star”, a multi-
billion-asset management company for 3 years.
MANAGEMENT, AHMEDABAD.
17 HE HAS WORKED IN
13 PRANAV AGARWAL HAS DONE HIS MBA IN FINANCE FROM INDIAN INSTITUTE OF
He is the fund manager of Stratton Group.
GOLDMAN SACHS AS A FUND MANAGER FOR 5 YEARS. 13 HE HAS A DEGREE IN CFA
(CHARTERED FINANCIAL ANALYST)
Preksha Parmar is the equity analyst in Stratton Group. She has done her MBA in finance from Wharton Business
School and was the faculty head on the board of Stanford Graduate School of Business. 13 SHE HAS A DEGREE
IN CFA (CHARTERED FINANCIAL ANALYST)
YEARS.
1 PRITHU CHAWLA HAS BEEN WORKING IN THE PORTFOLIO MANAGEMENT FOR THE PAST 7
He completed his MBA from Harvard School of business and did his Ph.D. in the field of finance from
M.I.T. (Massachusetts institute of technology). He worked for 3 years in BlackRock, U.S. as an assistant fund manager
and 2 years in Vanguard Group, U.S.
Priyal Sangal has done her MBA from Yale School of Management, New Haven. She worked at ICICI bank in Wealth
management for 2 years and in Reliance mutual funds for 3 years.
Conclusion From the analysis done, it can be seen that the returns the fund is providing in all the three investment
periods is high as compared to the market returns in spite of the stringent government restrictions and local tax laws
Sharpe ratio for the portfolio, which has three cycles April 2011- March 2016, October 2011-September 2016, April
2012-March 2017, are 1.0448, 1.1987, and 1.8087 respectively.
Investors with a high risk-return investment objective can opt for this sector specific mutual fund. The Brewery &
Distillery Industry in India has seen a steady growth in the past few years due to the change in the lifestyle of the
consumers in India.
The Indian Brewery & Distillery Industry is one of the fastest growing and upcoming industries in the world with
numerous unexplored segments. In the coming years several international players will expand their operations into
the Indian alcoholic drinks market due to the economies of scale poised by the market and the compelling business
potential. Therefore, investing in this mutual fund would give high returns in the coming years.
References 1.https://investment.prudential.com/util/common/get?file=CB502C80C4A99D6F85257B7D00527563
15 HTTP://WWW.INVESTOPEDIA.COM/ 3. http://www.ngeninvest.com/breweries--distilleries 4.
https://www.sbimf.com/en-us/lists/sid_kim/sid%20-%20sbi%20savings%20fund.pdf 5. 18
HTTPS://IN.INVESTING.COM/ 6. 19 HTTPS://IN.FINANCE.YAHOO.COM/ 7. 16
HTTP://WWW.MONEYCONTROL.COM/ 8. http://www.financialexpress.com/industry/indian-
alcoholic-
beverages-market-outlook-to-2020-inflating-demand-for-imfl-and-beer-from-youth-and-women-segments/114327/
9.http://www.hdfcfund.com/CMT/UPLOAD/ARTICLEATTACHMENTS/HDFC_Balanced_Fund_SID_Apr_17.pdf
10. http://www.sebi.gov.in/sebi_data/attachdocs/1315910593619.pdf 11.
https://assetmanagement.kotak.com/documents/19/e4b772f8-ddad-4e09-8d88-ee213fd5a8f0 12.
http://www.moneycontrol.com/annual-report/unitedbreweries/directors-report/UB02#UB02 19

Investment Analysis and Portfolio Management of Indian Breweries Market 2017

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Investment Analysis and Portfolio Management of Indian Breweries Market 2017

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Investment Analysis and Portfolio Management

Name of The Fund: Stratton Oakmont Mutual Fund

Date of Submission: 25th September, 2017

TYBBA- E (Group 5):

3. List of assets and its Justification 7

5. Asset Allocation Process 9

a) Standard Risk Factors

b) Scheme-specific Risk Factors

Name of Fund Stratton Oakmont Mutual Fund

Benchmark Index Nifty 50

The investment objective of this scheme is to produce steady long-term capital

Sector funds invest mostly in equity shares of companies in a particular business

An open ended equity scheme:

b) Intermediate and Long term (more than 5 years)

c)Finance and audit committee

The committee will:

The main responsibility of a fund manager is to implement a reliable investment strategy

List of assets/asset class and justification for selection.

United Breweries Limited:

United Spirits Limited:

Associated Alcohols & Breweries Limited:

Radico Khaitan Limited:

Returns with Radico Khaitan Returns without Radico Khaitan

Asset The asset allocation process was carried out by undertaking a

STEP 3 The Average Monthly HPR and Standard Deviation,

calculated for each equity stock for every time period.

STEP 4 Using Data Analysis, the VAR-COVAR Matrix is

NIFTY Risk Free

2. October 2011-September 2016 (United Breweries, United Distilleries, Assoc Alcohol,

NIFTY Risk free Rate

Investment & Advisory Fees

If the funds are redeemed before 30 days Exit Load: 0.20%

If the funds are redeemed after 365 days Exit Load: 0%

Portfolio managers’ background