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THE ECONOMIC TIMES Will this bear
market be
brutal or
benign?
P12
www.etwealth.co | Ahmedabad, Bengaluru, Chennai, Hyderabad, Kolkata, Mumbai, New Delhi, Pune | May 18-24, 2020 | 24 pages | `8
Arogya
Sanjeevani
Is it for you?
Know the pros and cons of the
standardised health insurance plan to
check if it suits your needs. P2
WORKS HY ffs
(MV 0
cover story
02 The Economic Times Wealth May 18-24, 2020
Arogya
Sanjeevani
Is it for you?
By Riju Mehta says Pushan Mahapatra, MD & CEO, SBI in terms of coverage, inclusions, exclu- while the rest of the cost is borne by the
General insurance (see ‘Arogya is a simple sions, as well as the terms and conditions, insurer. “Co-pay is introduced by the
A
mong the many learnings im- product..’). Besides the high premium and remain the same across insurers. The pre- insurer to cover the risk of uncertainty
parted by the coronavirus, per- obscure terms and conditions in the fine mium, however, varies. This is because it about the customer profile, and is, in fact,
haps the most relevant for India print, there were other problems. “The tra- is reflective of the costs associated with a low in case of AS,” says Prasun Sikdar, MD
is the need for health insurance ditional mindset was to procrastinate the plan: claims, management expenses and & CEO, ManipalCigna Health Insurance.
coverage. As the pandemic con- purchase since it was not considered es- distribution costs incurred by the com- There is a waiting period of 30 days, but
tinues to rage, the dire health scenario has sential, not to mention the lack of accessi- pany. “Since the claims ratio, staff and the coverage is wide, including treatment
come to the fore: in a country where the av- bility,” says Bhabatosh Mishra, Director, servicing, growth and expansion, distri- costs for coronavirus and other illnesses.
erage retail healthcare inflation has risen Claims, Underwriting & Product, Max bution across various demographies and It includes daycare treatments, Ayush and
sharply from 4.39% in 2017-18 to 7.14% in Bupa Health Insurance. regions is different for each company, the and modern treatments, besides dental
2018-19, as per the Economic Survey 2019, Many of these hurdles seem to premium is bound to vary,” says Mishra. and plastic surgery. There are, however,
only 4.2 crore people, out of a 130 crore pop- have been taken care of with Arogya There is, however, no zone pricing in the several restrictions and limitations in the
ulation, have retail health policies. This Sanjeevani, with clearance given to 29 plan, implying that the premium will coverage of some of these treatments.
means that the out-of-pocket spends are a general and health insurance companies remain the same across regions, whether
high 65% against a global average of 18%, to market the product. While 16 odd insur- the buyer is in a metro or a tier 3 city. Benefits & drawbacks
as per the insurance regulator, Irdai. ers have already brought out the product, It does have a co-pay inclusion of 5%, While the plan seems to offer a good deal at
This is the reason that, in recent mandated to be launched by 1 April 2020, which translates to the customer shelling a low cost, the market still has a lot of basic
years, the government and Irdai have others are set to follow suit soon. Does this out 5% of the sum insured from his pocket, health plans that offer wide coverage and
tried to step in and correct the skew. mean you can buy Arogya Sanjeevani
The Ayushman Bharat Pradhan Mantri without a second thought and it will take
Jan Arogya Yojana was introduced in care of all your health insurance needs?
2018, with the intention of providing free “As the features of Arogya
health coverage to the bottom 40% of the What does it offer? Sanjeevani are similar, the
population, or 50 crore people. Last year, AS is a basic health plan that offers a lim-
Irdai mandated the launch of Arogya ited cover of `1-5 lakh for one year, with serviceability of the company
Sanjeevani (AS), a low-cost product with a
nominal cover and attractive features.
the annual premium ranging from `4,000
to `7,500 (see Snapshot...). It can be bought
will be important when
“The need for health insurance has as an individual or a family floater plan, customers choose a plan.”
always been there, but people have not covering spouse, children, parents and
GURDEEP SINGH BATR A
GETTY IMAGES
bought it for various reasons, one being parents-in-law. HE AD, RE TAIL UNDERWRITING, BA JA J ALLIANZ
the complexity in the product itself,” The important thing is that the features, GENER AL INSUR ANCE
cover story
The Economic Times Wealth May 18-24, 2020 03
features. Should one discard those in fa- relatively low premium stands out as a
vour of Arogya Sanjeevani? It is essential distinct advantage. The premiums for
to consider the pros and cons before tak-
ing a final decision.
similar basic health plans in the market
are 20-50% more expensive, a huge differ- Snapshot of Arogya
No confusion: “One of the biggest
problems faced by buyers was that there
were multiple insurance products of-
ence for buyers.
Some of the latest treatments such as
stem cell therapy and oral chemotherapy
Sanjeevani
fered by companies, with different sets of are covered, while dental and plastic
pricing in metros and surgery, even cataract
non-metros, and with surgery is insured,
various add-ons. It led which are typically not
to a lot of confusion covered by basic plans.
as to which product
to buy,” says Gurdeep
Another attraction is
the inclusion of alter- Main features
Singh Batra, Head, native medicine treat-
Retail Underwriting, ments, such as homoe- Sum insured Policy term Renewability
Bajaj Allianz General opathy and ayurveda.
Insurance. While most of these
`1-5 lakh 1 year Lifelong
“Besides, the fine treatments are covered
print in the policy by other health plans, Eligibility Co-pay No-claim bonus
would typically surface they usually come for a 18-65 years 5% of sum 5-50% of
only at the time of claim higher premium.
settlement,” says S.
“Arogya is essentially Flexibility: The plan
(dependent kids: 3 insured sum insured
months to 25 years)
Brahmajosyula, Head, for the first-time buyers has other advantages
Underwriting, SBI like the option of paying
General Insurance.
with low income and premium in monthly,
With Arogya, there is low insurance visibility quarterly, semi-annual
a high degree of clarity
since the features, as
in tier 3/4 cities.” or annual instalments.
It also offers to cover
What does
well as terms, are stand-
ardised and remain the
PR ASUN SIKDAR
MD & CEO, MANIPALCIGNA
parents and parents-in-
law at a reasonable pre-
it cover?
same across insurers. HE ALTH INSUR ANCE mium, which is typical-
So one doesn’t need to ly offered by other plans
Hospitalisation
compare and research for the best plan. If for a much higher premium. Besides, it Includes hospital room rent,
it meets one’s requirements, one can pick offers lifelong renewability, portability boarding expenses, doctor fees, Daycare
nursing expenses, operation
it depending on the premium that suits and the delivery of soft document copies to
theatre and ICU charges,
treatments
one’s budget. customers.
surgeon, anaesthetist, medical All daycare
Wide cover at low premium: To be able “The plan is quite reasonably priced, treatments are
to get such a large set of treatments at a so one can easily buy a small individual
practitioner, consultants,
specialist fees, medicines used during hospital covered, but
stay, road ambulance charges, pre- and post- OPD is not.
hospitalisation expenses.
How much
premium
will you ANNUAL ANNUAL
Arogya Sanjeevani vs Basic health plans cover at a young age. Later, with growth in
family and income, one can port to a bigger,
more comprehensive cover,” says Anand
AROGYA SANJEEVANI BASIC HEALTH PLANS Roy, MD, Star Health and Allied Insurance.
FEATURES Capping & limitations: Remember, however,
that the low premium comes for a cost. The
room rent sub-limit, which is typically 1%
Sum insured `1-5 lakh Higher sums insured available of the sum insured or nil in basic health
plans is 2%of sum assured up to a maxi-
mum of `5,000, and for ICU, it is 5%up to a
Premium `4,000-7,500 20-50% higher than AS
maximum of `10,000.
Similarly, modern treatments are cov-
Individual, family floater, including Individual, family floater, parents
Cover type ered up to 50% of the sum insured, while
parents & parents-in-law optional at a higher premium
cataract surgery is covered up to 25% of
2% up to `5,000 & sum insured or `40,000 per eye. The dental
Room rent Either no room rent capping or 1-2%
5% up to `10,000 for ICU and plastic surgery are covered only in
case of an illness or accident. Many health
Co-pay 5% of sum insured Usually 10-30% plans that offer these facilities come with-
out such limitations.
Different premiums for metros and tier Another limitation is the size of the
Zone pricing No zone pricing
1, 2, 3, 4 cities
All insurers are mandated to cover by 1
Modern treatments Covered up to 50% of sum insured
Oct 2020
A
s part of the Covid relief meas-
ures, the government has
extended the deadline for fil-
ing income tax returns for the To ease the stress on employers,
financial year 2019-20 from 31 the government has reduced the
July to 30 November. Similarly, the dead- contribution to the EPF account
line for tax audit has been shifted from 30 from 12% to 10% of an employee’s
September to 31 October. salary for the next three months.
Earlier, the deadline for receiving Form- Employers will save money due to
16 had been extended from 15 June to 30 the 2% reduction in their contribu-
June in view of the disruption caused by tion to the EPF of their employees.
the nationwide lockdown. Tax experts While the move will also increase
were therefore anticipating an extension in the take-home salaries of employ-
the ITR filing deadline. ees, financial experts say it would
The government has also reduced the also curtail the growth in the indi-
TDS rates applicable for non-salaried vidual’s Provident Fund account.
payments. As per the announcement, to If the total contribution is reduced
provide more funds to taxpayers, TDS for from 24% to 20%, the employee
non-salaried payments and TCS for speci- will be contributing 16.6% less to
fied receipts shall be reduced by 25%. The his retirement savings for the next
reduced TDS and TCS rates will remain three months.
valid till 31 March 2021. The reduced rates higher than the TDS rate, the taxpayer and penalty under the Vivad se Vishwas Of course, this would also depend
will be applicable on payments such as TDS may have to pay a higher self assessment scheme has been extended to 31 December. on how salaries have been struc-
on rent exceeding Rs 50,000 per month, tax later. Therefore, a lower TDS may sim- This is the second extension of the scheme. tured by an organisation. If the
dividend payments from mutual funds and ply defer the liability. In case the TDS rate Earlier, it had been extended to 30 June. PF contribution is part of cost to
companies and TDS on fixed deposits. is higher than the tax payable, the move The Vivad se Vishwas Scheme was an- company (CTC) of an employee’s
However, the reduction in the TDS and will reduce the amount that gets stuck nounced in the Budget 2020 to allow one- salary, the employer may have to
TCS rates does not mean any reduction in with the government before it is claimed as time settlement of tax disputes between the pass on the benefit to the employee
the tax liability. An individual will still a refund. tax department and individuals. The settle- by way of increasing some other
have to pay tax on the entire payment as In a further relief to taxpayers, the last ment can be made without paying any pen- allowance.
per the applicable slab rate. If the tax is date for making payments without interest alty and interest on the disputed amount.
guest column
06 The Economic Times Wealth May 18-24, 2020
H
ow can you ensure that if you
have been saving and growing
your wealth over the years, then
an event like the Covid pan-
DHIRENDR A KUMAR
CEO, VALUE RESE ARCH demic does not slash and burn
through your portfolio within months?
Even though Covid-19 is a new phenom-
money ena, there’s nothing new about the problem
T
hough residential real estate ies. While this will be the back up plan of
has very few takers right now, companies against disturbances like this,
the future looks promising. The it will also create more job opportunities
housing segment is expected in smaller towns,” says Thakkur. More
to propel the real estate sector job opportunities in smaller cities would
forward between 2022-25. mean increased housing demand in those
Among favourable factors, the emerging places and lower migration to metros. The
structural change involving work from working class profile may also support
home will play an important role. While housing demand in tier 2 cities. “Demand
most people are now working from home in smaller cities is driven by end users.
due to the current circumstances, several Since the percentage of government and
IT companies have already announced public sector employees are high, the ongo-
that this would be a permanent feature for ing employment slowdown will not affect
at least a part of their workforce. “Work this segment,” says Thakkur.
from home as a concept is going to remain
because some companies are realising The way forward
that productivity is not impacted by this. Though home buyers have to consider
This also allows companies to hire employ- factors like their job security, etc, experts
ees from smaller towns,” says Shveta Jain, feel that the coming quarters will be a
MD, Residential Services, Savills India. good time to start searching because of
In the first phase, this shift will be mod- the expected correction in price. Since
erate because companies will be grappling new transactions are not happening due
with issues like data confidentiality, etc. to the lockdown, the pricing pressure is
“Once things settle, majority of the work- not visible now. However, experts feel
GETTYIMAGES
ers will go back to offices and only the non that the end user activity will come back
client facing will continue to work from in the next 2-3 months and the downward
home,” says Prashant Thakkur, Director pressure in price will be visible after that.
& Head of Research, Anarock. What will “Though the extent of price correction
be the impact? “The impact will be more will vary from micro market to micro
in some sectors like IT and less in others. As most urban homes today do not come and spoke model—main office in the city market, housing prices are expected to
So, this could be around 10-15% of the ag- with space meant for a home office or centre and several smaller offices in the come down by 5-8% in the next 6-9 months
gregate work force, which will also be sub- study, a bigger home in the suburbs could suburbs. Since there is a shortage of qual- and this will open up opportunities for
stantial,” says Samantak Das, Executive be the answer. “Most people settled for ity office space in the suburbs now, this end users,” says Jain. Since prices have
Director and Head of Research - Real small houses close to office. If they work shift may happen only in the medium to remained flat for the past few years, time
Estate Intelligence Services, JLL India. from home, people will move away from long term,” says Das. correction has happened already. Das also
city centres to suburbs, which are more feels that this is a good time to search and
Emerging suburbs spaced out and also cheaper,” says Jain. Tier 2 cities will gain zero in on the dream house of your choice.
The work from home culture will change Companies have also started realising Though metro dwellers are unlikely to “Though prices of existing projects are not
the way we live. Moving to more spacious that lower travelling time means more shift to smaller towns, several positive de- being lowered, new projects are coming up
homes in the suburbs would make sense productivity. “To reduce travelling time of velopments are expected there also. “Due at competitive prices. Even corporate de-
because commuting will not be required. employees, companies may go for the hub to continued Covid-19 induced restric- velopers are giving good offers. Being in a
buyers’ market now, home buyers can also
drive a hard bargain,” he says.
In addition to the suburbs and smaller
cities, real estate investors can also look
at lower priced segments like affordable
and budget housing that are expected to
recover first.
“While high end projects will continue
Residential will lead next phase of recovery Estimated Within 6 months
6 to 12 months
to suffer due to lack of demand, affordable
and budget projects will recover first.
Average annual investment (in $ billion) is projected more in housing. time to More than Continued government support will be
12 months
5.10
Office Residential Others 5.50 recovery the main driver in keeping the affordable
segment resilient,” says Thakkur. Das
Total
Affordable concurs. “While affordable and budget
3.90 1.10 housing 21 segments are expected see green shoots
1.00 3.50 3.60
is more from the coming festive season (from
0.70 resilient and 62 October), high-end and luxury segments
1.00 1.10 2.90 is expected will remain stagnant in 2020-21,” he says.
2.80 to bounce 51 Properties costing up to `40 lakh are re-
2.40 1.20 1.20 back faster. ferred to as affordable housing and proper-
ties costing between `40 and `80 lakh are
1.30 1.30 1.30 1.50 Recovery will start 32 referred to as budget housing.
0.80 once the nationwide
28
restrictions are
Phase 1 Phase 2 Phase 3a Phase 3b Phase 4 significantly eased
2010-13 2014-17 2018-19 2020-21* 2022-25* Note: Based on a
6 Please send your feedback to
survey by Savills Affordable Other
etwealth@timesgroup.com
Figures for 2020-21 and 2022-25 are estimates by Savills India Source: Savills India India Housing Housing
guest column
08 The Economic Times Wealth May 18-24, 2020
NARENDR A NATHAN
IS CHIEF MANAGER,
INVES TMENTS, E T WE ALTH
Comparison
between March and
April reveals AMCs
and fund managers
have also learned
their lessons and
reduced their
exposure to lower
rated papers.
GETTYIMAGES
T
he recent closure of six schemes debt investments as debt should be for pro- ple, the AUM of ICICI Prudential Medium More importantly, most of these papers
by Franklin Templeton shocked viding stability to the portfolio and not to Term Bond Fund, a scheme with 53% were illiquid and therefore, AMCs could
debt fund investors. Though generate additional returns. Equity is the exposure to AA rated papers, fell by 19%. not sell them in the market to meet re-
there were a number of side right asset class for trying to generate addi- The AUM fall in IDFC Bond Fund, which demption requests. The fund industry sur-
pocketing incidents earlier, no tional return by taking higher risk. has 100% in AAA and sovereign papers, vived that crisis only with the help of Sebi
one expected a complete closure. Side pock- Investors are displaying maturity by fell only by 7% in April. Similar investor and RBI. However, once things settled,
eting entails segregating bad quality pa- distinguishing between categories based distinction is visible in the ultra short AMCs started taking higher risks again.
pers from the main portfolio and convert- on risk and have started shifting money to term category as well. While AUM of ICICI As blindly believing debt fund manag-
ing these into a separate scheme. While the safe categories. Net inflow into liquid and Prudential Ultra Short Term, a scheme ers is not a good strategy, investors have to
original scheme continues with reduced overnight funds were `68,848 crore and with 55% AA or lower rated papers, fell by check the scheme portfolios every month.
net asset value (NAV), no entry or exit is `2,603 crore respectively. However, inves- 12% in April, AUM of HDFC Ultra Short The credit profile of a portfolio can change
allowed in the segregated scheme. This tors were quick to reduce exposure to cate- Term Fund, a scheme with 100% in AAA either because the fund manager takes
scheme is wound up as and when money, gories taking unnecessary risks. Duration rated papers or equivalent remained flat. deliberate action in this regard or because
either in full or in part, is received from its funds are supposed to be normal debt funds Comparison between March and April of redemption pressures. Assume scheme
investments. Franklin Templeton’s action with papers restricted to that duration. reveals AMCs and fund managers have XYZ has an AUM of `100 crore and 50% of
was akin to segregating entire schemes. Dynamic bond category, on the other hand, also learned their lessons and reduced its investments is in high rated papers and
Investors will have to wait years to get is supposed to shift between different their exposure to lower rated papers. the remaining in low rated papers and it
their money back—in part or full— de- durations based on market situations and However, there is no guarantee that fund is facing a sudden redemption of `25 crore.
pending on the situation then. generate additional returns. Sebi’s classifi- houses will continue to be extra vigilant Since lower rated papers are usually illiq-
The event created panic among debt cation rules did not specifically ban these forever. If one goes by history, AMCs and uid, the fund manager will be forced to sell
fund investors and redemptions were not categories from investing in lower quality fund managers will forget about this inci- high rated papers. After this, the scheme
restricted to Templeton schemes alone. papers and some AMCs used that loop- dent in 1-2 years and will start taking risks will be left with `25 crore of high rated pa-
However, redemption data from April hole to generate higher returns by taking again. For instance,the extra vigilant pers (33% of portfolio) and `50 crore of low
shows investors taking a judicious ap- higher credit risk. The net outflows from stance generated by the fixed maturity rated papers (67% of portfolio). Any fall in
proach. For example, there has been a net all these categories in April show investors plan (FMP) crisis in October 2008 didn’t quality of portfolio and reduction in AUM
outflow of `19,239 crore from credit risk have figured out the game. last long. The crisis then was triggered due is a warning sign and investors should
funds in April. This indicates long -term Another point worth mentioning is to faulty design of the product. The FMP’s rush to the door before it shuts.
investors are realising the folly of taking that investors have started checking the entire portfolio was locked into the tenure
risks in the debt portion of their portfolio portfolio quality of each scheme within of the scheme, but investors were allowed
Please send your feedback to
just to earn 1-2% more. Safety, liquidity categories and have started distinguishing to redeem in the middle with an exit load.
etwealth@timesgroup.com
and return (SLR) principle should guide schemes based on credit profile. For exam- This created an asset liability mismatch.
mutual funds
The Economic Times Wealth May 18-24, 2020 09
by Sanket Dhanorkar Gilt and long duration funds have AMC, insists investors should not buy
gilt funds expecting a repeat of last
enjoyed a strong run for two years
I
nvestors have been piling on to year’s performance. “If you buy a gilt
gilt funds, attracted by the high fund make sure you have a very long
double-digit returns. It is not just 1-year Net assests horizon,” she says. Pathak argues it is
Fund
new investors flocking towards return (%) (` Cr) better to play duration through dynamic
this space. Data from AMFI IDFC Government Securities - Constant Maturity Plan 18.8 229 bond funds given their flexibility to cut
shows that while `2,846 crore flowed portfolio duration sharply in anticipa-
into gilt funds in April, the segment ICICI Prudential Constant Maturity Gilt 18.4 164 tion of rate hikes. “Existing investors in
saw only `330 crore worth of redemp- duration funds may cut back positions to
IDFC Government Securities - Investment Plan 18.1 858
tions. Existing investors seem to be some extent,” he adds. This will still al-
keen to hold on to their hefty gains. Axis Gilt 17.5 86 low you to gain from any further upside
Very few are actually booking profits if it plays out.
SBI Magnum Gilt 17.5 2,433
in this segment. Given the recent de- Apart from the great returns, inves-
velopments, can this approach hurt DSP 10Y G-Sec 17.4 48 tors have also latched on to gilt funds for
investors? another reason. Concerned by recent
DSP Government Securities 17.3 1,036
Both gilt and long duration funds sharp NAV drops in debt funds owing to
have enjoyed a good run for over two Nippon India Nivesh Lakshya 16.8 1,135 defaults and credit rating downgrades,
years now. Ever since the central bank investors are finding safety in the
SBI Magnum Constant Maturity 16.6 609
embarked on a series of rate cuts from sovereign guarantee of government
mid-2018, returns from such funds have Nippon India Gilt Securities 16.4 1,250 securities. But experts warn investors
soared. Bond yields and interest rates are turning a blind eye to a different type
move in opposite direction to bond pric- Data as on 13 May 2020 Source: Value Research
of risk in gilt funds. While credit risk
es. When interest rates fall, bond prices in this basket can be safely ignored, gilt
go up. Longer duration bonds see steep- market on tenterhooks, analysts say. IDFC AMC. “We have seen the reveal of funds are highly susceptible to interest
er rise. The recent sharp 75 basis points “A lot of volatility can be expected in the expansion in deficit but market yields rate risk. There is the possibility of loss
cut by RBI further propelled the NAV of the long duration strategies in coming are reacting to the absence of any absorp- of capital owing to adverse movements in
these funds. Gilt funds and long dura- days,” warns Pankaj Pathak, Debt Fund tion plan so far from the central bank of interest rates—specifically, an uptick in
tion funds have clocked 15% and 16.6% Manager, Quantum AMC. “There is still this excess duration supply,” he adds. interest rates. A look at historical perfor-
respectively over the past year. During huge uncertainty about the financing of The RBI will have to step up open-market mance shows that this risk can deliver
this time, yield on the benchmark 10 the fiscal deficit and how much of incre- purchases or execute further “Operation blows far worse than credit defaults.
year sovereign bond has softened from mental government bond supply will be Twists”—where it buys longer maturity Pathak says, “Gilt funds may be safe
7.4% to below 6%. The question now is, absorbed by the RBI,” Pathak adds. The government bonds and sells short matu- from credit perspective, but are not from
how long will this party continue? dynamics between the known expan- rity notes. If the RBI does not absorb the the interest rate perspective.” Do not buy
Now even if the central bank cuts sion in fiscal deficit and the somewhat additional supply in some manner, there gilt funds as a substitute for a ultra short
interest rates further to prop up a stut- unknown quantum of financing of this could be a sell-off in gilts, analysts duration fund because you are chasing
tering economy, the bond markets may by the central bank is important, say. safety, Gupta asserts. “To try and solve
not share the joy. This is because the argues Suyash Choudhary, Radhika Gupta, one problem, you will create another
government is now resorting to higher Head – Fixed Income, CEO, Edelweiss one,” she cautions.
market borrowing to plug revenue
shortfall arising due to weak economic
Please send your feedback to
activity amid the Covid-induced lock-
etwealth@timesgroup.com
down. The government intends to bor-
row `12 lakh crore—50% more than
the earlier target—to finance its fiscal
deficit. Bond markets fret over excess
supply as it pushes bond prices down.
Experts indicate the bond market tra-
jectory going forward will be guided
more by the fiscal math and the addi-
tional borrowing it entails.
Early indications are that the gov-
ernment may not have to stretch the
fiscal math as much as feared. Despite
the `20 lakh crore stimulus package,
the actual direct hit borne by the treas-
ury is likely to be much lower. “From
a fiscal standpoint the immediate cost
to the exchequer will be in the
range of `1-2 lakh crore, which
is not too outlandish given the
current situation,” says a note
by Axis AMC. While this is a
relief, bond markets still have
GETTYIMAGES
T
he expected return of a stock is The company has significantly reduced
based on the risks it is exposed its net debt in the fourth quarter of 2019-
to. The difference between the 20 and the commentaries from its global
actual return and the expected peers indicate that the demand for agro-in-
return is termed as alpha. puts is intact despite Covid-19 challenges.
Stocks that generate positive alpha are According to a report by Emkay, there is
sought after. The market or systematic a likelihood of a rating upgrade in 2021-22
risks hold considerable importance in the based on its estimated adjusted net debt
risk and the expected return relationship. to EBITDA ratio. The brokerage house
This is because diversification strategy estimates EBITDA margins of 22.1% and
cannot eliminate the market risks and 22.5% for 2020-21 and 2021-22 respectively.
therefore, investors should be compensat-
ed for such risks. In finance theory, capital Navin Fluorine International
asset pricing model (CAPM) is widely used It is a specialty fluorochemicals company
to estimate such expected returns. that specialises in the manufacture of
CAPM is a one-factor model where the refrigerants, and various organic and in-
sensitivity (or beta) of a stock with respect organic fluorides. The company’s specialty
to the market index returns, acts as a cru- business & CRAMS (Contract research
GETTYIMAGES
cial variable in estimating the expected and manufacturing services) segments are
return. However, the stock markets are growing at a robust pace helped by strong
influenced by several macro variables domestic and export volumes. Analysts be-
like inflation, industrial production, GDP lieve that the proposed capex of `450 crore
growth, currency movements, govern-
ment finances, international oil prices,
etc. Each of these factors have a varying
APT positive alpha stocks with good potential
level of influence on different stocks. For The actual return is compared with the expected return to identify stocks with positive alpha.
example, the weakening of a nation’s cur-
rency has a positive effect on the export- Dividend Current Target Upside Experts’ views
Company PE
yield (%) price (`) price (`) potential(%) Buy Hold Sell
oriented companies, whereas companies
dependent on imported raw material get Finolex Industries 12.56 2.74 364 644 76.6 15 3 0
negatively affected.
To include the impact of different fac- UPL 57.11 2.14 376 564 50.3 30 2 2
tors on the expected return, a multi-factor
Navin Fluorine International 41.78 0.55 1,410 1,665 18.0 10 3 0
model known as arbitrage pricing theory
or APT model is used. It is an extension Essel Propack 61.53 0.74 170 199 17.3 9 1 1
of CAPM where the expected return of a
Current price, PE and Dividend yield as on 12 May 2020. Source: ACE Equity and Bloomberg.
stock is calculated as a linear function
of various macroeconomic factors. The
sensitivity of a stock with respect to each ing on the number of risk factors included. average positive alpha of 2%. To look at the will help the company explore new avenues
macro factor is represented by a factor For the computational aspects, APT future potential of such stocks only those and scale up its international position.
specific beta. In other words, there will be involves the application of multiple linear that are covered by at least five Bloomberg
different betas, each representing a stock’s regression and cross-sectional regression. analysts and with one-year forward price Essel Propack
sensitivity to the said factor. The model is However, this article does not focus on potential greater than 10% were included. This is a specialty packaging company
represented as: computation methodology. It aims to iden- Let us look at four such stocks: that manufactures laminated plastic tubes
E(r)=Rf+ (f1)+ (f2)+ (f3)+ … + (fn) tify stocks that have generated positive catering to the FMCG and pharma space.
1 2 3
A small drop does not mean a fast recovery Sharp initial recovery may not always sustain
2008-10 saw the steepest and fastest drop, yet witnessed the swiftest recovery.
PERIOD
Days taken to retrace market decline (post bottom)
market be brutal
Number of trading days
1994-1999 15 42 79 499
448
411
369 2000-2004 51 433 65 23
2008-2010 29 22 150 210
261
or benign?
2008-10 phase retraced initial 50% of the market fall very quickly but took much longer to recover final 50%.
In current slump, index has retraced 25% within 9 days and nearly 50% within another 24 days.
Even if market recovers quickly initially, it can take very long to fully recover lost gains. Be prepared for a lengthy fight.
74
35 24
-40.7 -56.2 -60.9
Recovery can be very slow initially,
Peak to 20% drop 20% drop to bottom Bottom to peak Peak-bottom drop (%) gaining speed much later
2020 has seen market transition from peak to bear market (20% drop from peak) in 41 trading days, but has not
reached the depths of previous bear markets. 2000-04 saw index remain weak for several months.
% of market decline recovered (post bottom)
As the ongoing bear market plays After 30 days After 100 days After 300 days
Markets can trade far below out, Sanket Dhanorkar looks back 1994-1999
peaks for a long time on three previous bear markets to 36.2
2000-04 saw index stay beyond 40% drop for the longest time.
offer you some perspective on the 54.3
Number of trading days below peak
severity of drawdowns and 54.5
14.1
1994-1999 391 494 270 2 31
2000-2004 120 154 194 508 21.2
22.4
Despite sharp sell-off, 2020 has not yet witnessed severity of previous bear markets.
57.8
66.2
Sharp upticks can be false signals Index recovered 35% of lost value within first 30 days in ongoing phase of market. Even if market takes time to
recover initial losses, the last leg of recovery may come through very rapidly.
Bear markets can often have steep relief rallies.
Return (%) Return (%)
Investors have to be ready for myriad scenarios Recovery
12 Sep 1994- 11 Feb 2000-
-38.9 25 Jan 1996 -33.9 22 May 2000 Vicious bear markets in the past have
from steep
evolved in different ways 40% DECLINE DAYS TO
PERIOD
110 DATE RECOVERY
65.7
70
Be ready Return (%)
55.1
25 Mar 1996-
24 Apr 1996 20
18 Oct 2000-
15 Feb 2001 23.5
60
for a topsy 28.6
turvy ride
2020-? -26.8 -29
50 Recovery phase can
24 Apr 1996- 15 Feb 2001-
75.4 be very turbulent. The
-29.1 4 Dec 1996 -41.4 21 Sept 2001 1994-99 recovery saw
40 steep fluctuations.
4 Dec 1996- 5 Aug 1997- 12 Dec 1997- 21 Apr 1998- 23 Jun 1998-
5 Aug 1997 12 Dec 1997 21 Apr 1998 23 June 1998 14 Jul 1999
Bear markets are sometimes interrupted by sharp upticks that turn out to be “sucker rallies” —drawing in
investors who mistake it for the start of a sustained recovery. 30 Sometimes, markets can give up chunk of gains on the way to full recovery. The 1994-99 bear market recovered
96% of its value by Aug 1997, only to sink again.
Current bear market has already witnessed a sharp 30% uptick. It remains to be seen if it is a part of
rebound or another false signal.
DAYS 0 37 111 185 259 333 407 481 555 629 703 777 851 925 1,073 1,147 1,157 NOTE: The figures pertain to movement of BSE Sensex daily closing values. Intra-day highs and lows not
considered, including for peak & bottom days. Only trading days considered for calculating timelines.
financial planning
14 The Economic Times Wealth May 18-24, 2020
GETTY IMAGES
opportunities and for a second career. During
these times of retrenchment and pay cuts, if
you had plans for a second job, your search just
got tougher. Be on the lookout for something
that might come your way, but prepare for not
W
hat if you are retiring now, tificates. You may also have some wealth in having an income. This is only a phase and it
in the middle of this crisis? gold, jewels and silver. will pass. Don’t despair that all your plans have
It is tough. You worry about This diversity is your saviour. Not eve- failed. Take this crisis as a break from work,
the wrong timing. It may rything will be losing value and not every- rest and rejuvenate yourself. Do not sink into
not be so bad after all, if you thing is needed at the same time. If there is complacency. Be prepared to find something
exercise your options diligently. one portion of your wealth with a value that worthwhile to do when the opportunity arises.
The problem with retiring in the mid- can fund your expenses for the next year to Eighth, do not make too many drastic chang-
dle of an economic crisis is that the value a possible extended period of three years, es to your spending and living habits. It is
of your investments shrink. What looked you should be alright. A simple source of li- unlikely that your PF balances or your assets
like a comfortable corpus is now a fairly quidity and income until things settle down do not cover your normal lifestyle expenses for
UMA SHASHIK ANT
diminished bundle of wealth. Then the is all you need to be comfortable. a period of 12 months. Do not cut back severely
IS CHAIRPER SON, CENTRE
FOR INVES TMENT opportunities to invest remain low, if not Third, postpone the decision to rebalance and harshly and live in fear that retiring in the
EDUC ATION AND LE ARNING quite risky in terms of timing. Rebalancing and shuffle. This is not the right time. Do middle of the crisis has pushed you down the
the portfolio or making long term decisions not sell that second house in panic. Do not ladder of comfort. Be kind to yourself. You have
about money is tough. No one is able to say liquidate your funds and stocks and convert worked hard all your life, devoting the best
which are the assets worth investing in. them to deposits. Sit through that loss if you years of youth to earn an income. Don’t allow
What should you do? can. Ideally you will rebalance your assets the negativity around you to take away from
First, avoid making long-term strategic a few years before retirement for generating the fact that you can truly use what you have
decisions. Do not assume that retirement income. If you have not done that already, saved. Keep indulgence in check, but don’t cut
means you must make all the decisions don’t try to do it now. As long as one portion back on the basics.
The problem about your corpus and wealth at that turn- of your assets allows drawing an allowance Ninth, do not talk about your money, wealth
with retiring in ing point. Take it easy for the next few for your regular expenses, you are quite ok. or plans to everyone. During times when peo-
the middle of an months until the economic scenario looks Fourth, do not indulge or distribute. ple are losing their jobs, suffering pay cuts and
economic crisis is clearer. Treat your retirement like a career Many feel quite rich with the corpus that is facing losses in investments that they cannot
that the value of break mentally. Hold back the eagerness to accessible after retirement. My mother got redeem, a recently retired person who has a
your investments gather and tabulate all your assets and to herself a whole stash of new jewellery when neat bundle credited into the bank, is both en-
shrink. What make modifications. her PF got credited to the bank account on viable and a target. Do not lend. Do not let oth-
looked like a Second, measure your situation based on retirement. She knew that her corpus was ers know the details. Guard your wealth.
comfortable corpus the diversity of your assets. That holds the not her source of post retirement liveli- Tenth, this too shall pass. Don’t be forced to
is now a fairly key to how your retirement will pan out. hood, and rightly trusted her children. I make decisions in a hurry. Or opportunisti-
diminished bundle It is likely that you own a home in which know of elders who give away the new found cally. Wait for normalcy and treat this period
of wealth. you live. Maybe you own a second home or wealth to children. Hold that thought. Keep as a pause. Don’t forget that what you have on
land too. You might have investments in your money and postpone any distribution hand is precious.
mutual funds and in the stock market. You or indulgence at this time.
may have a PF and gratuity that you can Fifth, don’t begin an enterprise and make
draw or invest in an annuity. You may have large investments to set it up. My cousins Please send your feedback to
etwealth@timesgroup.com
bonds, deposits, PPF, post office saving cer- always wanted to run a travel agency, and
financial planning
The Economic Times Wealth May 18-24, 2020 15
Prerequisites
The member must have an
activated UAN (Universal Account
Number) and seeded his bank
account details and Aadhaar to the EPFO
account. Also, the employer should have
approved and verified the e-KYC.
Approval by employer
After logging in, the member
should click on ‘Manage’ and
then ‘KYC’ to enter Aadhaar
number and bank details (of the seeded
account). The online claim facility can
be used after at least two months of
GETTY IMAGES
leaving the job after it is approved by
the employer.
Claim process
The member can click on the
S
Sharad is a 28-year-old harad misses having an emer- satisfaction and motivation to keep going.
gency fund at his disposal in these The next step would be to find the savings ‘Online Services’ tab and then
pilot who understands the troubled times. The airline indus- that can be apportioned for this goal. A good choose ‘Claim’ form, which
importance of an emergency try has ground to a complete halt way of doing so would be to set aside money is a composite form No. 31, 19, 10C
fund to take care of unexpected and his income is under threat. for the fund first before considering other and 10D. Member’s information will
There is even a possibility of job loss as the expenses. An SIP into a short-term debt be updated on the page. One needs to
expenses. However, he has enter last four digits of the registered
airline industry is not expected to be back fund or an automatic transfer to a recur-
not been able to create such on its feet in the near future. A contingency ring deposit at the beginning of the month
bank account number. A pop-up with
a fund so far. He has tried to ‘Certificate of Undertaking’ needs
fund would have allowed him some cush- will allow Sharad to get used to managing
to be approved to proceed for bank
build a contingency corpus in ion to fall back on. his expenses on the reduced available in-
account verification. Once verified,
the past, only to give up due to However, it is never too late to start build- come. A standing instruction automates
the member can click on ‘Proceed for
ing an emergency fund. Sharad needs to lay the investment process while cancelling it
other demands on his income or claim’. The desired withdrawal option
down rules that will help him create and requires a little effort, which he might not must be chosen and the amount needs
because he did not have enough manage the fund appropriately. His first put in unless it is absolutely necessary. to be updated. Scanned copy of cheque
surplus. Mostly, he has ended step should be to calculate the amount he re- Sharad can reach this goal faster by cut- needs to be uploaded and address
up using whatever had been set quires. A fair estimate would be six months’ ting down on expenses and move any sav- of the member must be mentioned.
worth of living expenses. He should factor ings and excess income that comes his way, An authentication OTP will be sent
aside for emergencies on needs
in liablities like any loan that he may be ser- such as a bonus, towards this goal. He could to the registered mobile number. On
that were not really urgent. vicing. He should then divide this required take a conscious decision not to increase his verification, the claim will be submitted.
What steps should Sharad take amount into smaller targets that he can lifestyle expenses in line with an increase in
to get past this stage and move reach in stages. The smaller targets will salary for at least a year. This will help him
on to saving for other financial be easier to achieve and will give him the create the needed corpus quicker. Covid 19 EPF withdrawal
One can withdraw an amount
goals? Content on this page is courtesy Centre for Investment Education and Learning (CIEL). equal to three months’ of basic
Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta. and dearness allowance (DA) or
75% of the credit balance in the account,
whichever is lower, in case of financial
emergency due to Covid-19. One
smart things to know Super top-up health insurance plans needs to select ‘Outbreak of pandemic
(COVID-19)’ option against the ‘Purpose’
field and click on ‘PF Advance’ claim.
1 2
Super top-up It provides
health insur- cover over the :: Points to note
4
ance plans threshold limit Status of the claim can be checked
provide ad- of the health on the portal through ‘Check claim
3 5
ditional cover, The premium amount insurance It is a great status’ under ‘Online Services’ tab.
typically over is cost effective cover in product to It is important to weigh the pros and
and above due to threshold multiple claims Super top-up policy lapses enhance the cons of withdrawal from EPF as it
the basic limits of the cover or multiple when the entire cover is coverage of enjoys a tax-free investment status.
hospitalisa- provided by the basic hospitalisations exhausted and not when hospitalisation
tion policy. hospitalisation plan. in the year. you have used it once. expenses.
career strategy
16 The Economic Times Wealth May 18-24, 2020
GO FOR SIMPLE
2 Use one of your edits
GETTYIMAGES
to increase readability of your
work. Go for simplicity both in
choice of words and construction
of sentences. Writing does not
permit you the luxury of gauging
your audience’s reaction and
Using logic
D
id you know that you wrote a serve no purpose and create clutter for the
restating your point to improve
novel last year? If you use email Use the problem-solving technique to reader. Secondly, make it appealing to the
understanding.
at work, then you write be- choose your content. Firstly, establish the eye. If you are writing an email, break it up
tween 150 to 500 words or more context to get the reader on the same page into paragraphs no longer than three sen-
PUNCTURE THE
a day depending on your job.
That means about 40,000 to over 1,20,000
as you. What is the problem? How and who
does it affect? Why does it matter today?
tences each, use bullet points and sub-head-
ings, make important points bold and vary
3 BALLOON
words a year making a small or a large nov- Then what are the components of the issue, the length of your sentences. Additionally, Let out all the hot air from
el. Add to that various presentations, team what are the reasons for each, what are the use the active voice instead of the passive, your writing to increase impact.
notes, pitches and proposals that could boundary conditions and if this problem is thus reducing the number of words while Shorten your writing drastically
make or break your career and income. similar to another problem? Finally, how focusing on the subject instead of the object in the first edit itself. Delete the
With that volume of writing contributing to solve the causes, who will solve it, what of the sentence. first two paragraphs and check
to your professional success, you need to resources are required and by what time? if there was more than a ripple
constantly upgrade your skills to achieve Does this cover all the questions that will Get these right in impact. Use one word instead
greater success through effective writing. arise in the reader’s mind? This is also the You are concerned about professional of a phrase or sentence. Delete
Let us get started, now. critical thinking approach and you will not writing. Hold that thought when you are fillers and adverbs like very,
require all these questions all the time. sending a message, chat, or WhatsApp. greatly, quickly, little, rather etc.
The only purpose Your messages should all be in prose with
The only purpose of writing is to be read. Telling the story no shortcuts in grammar, spelling or lan- TYPOS
By one person at a time. So, the first ques- How you tell the story or sequence your guage. Save the informality for friends and 4 Typos are the bane of
tion is, who are you writing for? Step into content changes the impact of your writing. family. Do a fact and figure check when- professional writing and hence
that person’s shoes. Understand that per- You can use the standard story-telling tech- ever you are referring to data, quoting a your second edit’s goal is to
son’s perspective, whether it is your boss, a nique—STAR or Situation, Task, Action report or person and pay special attention remove mistakes. Your word
client, or the customer service department. and Result. There is an extended version of to where you put the decimal point in num- processor like Microsoft Word
Unless you use the reader’s perspective, STAR that makes it easier to understand. bers. A factual error in one sentence and will not distinguish between
your writing will not be absorbed or even Pixar Animation studios from the Walt your writing is no longer trusted. Each lose (deprived of) and loose
read. If your manager is going to use your Disney stable uses it extensively in its mov- reader will need to expend extra effort (not tight) and you will ‘lose’
material to make a presentation to the ies - Once upon a time there was _______. thereafter to fact check and this will reduce respect on account of your
Board, then the directors are your final au- Every day, _______. One day _____. your credibility and readability. ‘loose’ writing. Use a grammar
dience. Do not write until you have taken a Because of that, ______. Until finally _____. checker tool like Grammarly or
few moments to specifically identify and be You can always improve study good emails to improve
one with your reader. This automatically Back to basics Writing is a skill. You are the craftsman grammar.
implies that there is no place for your own Get the appropriate format right. If you are continuously improving upon your current
emotions, especially anger, in professional writing an email, spend 20% of your time level of mastery and thus increasing your PARALLELISM AND
communication. in framing your subject line to make it rel- professional effectiveness and income. 5 REPETITION
evant and important for the reader. If you Your biggest resource is conscious read-
During your final edit,
Outline to begin are selling something, spend 80% of your ing. The more you read and notice how
implement for parallelism
The first hurdle you will face is your re- time in the subject. Know the salutation or other writers frame their emails, books,
and remove redundancy and
sistance to writing especially if you are how you are expected to refer to the reader. presentations and reports, the better you
repetition. Parallelism occurs
asking for something, writing to authority, Follow your firm’s standard format for the write and develop your individual style for
in—he came, he saw, and he
dealing with your own or the reader’s nega- beginning and closing of your emails, pres- different requirements. Additionally, your
conquered. But not in—he
tive biases. One simple trick will solve two entations and project reports. vocabulary improves and you exercise a
came, he saw, and he finished
problems. Make a brief outline on a page more effective choice of words in your sen-
conquering. Repetition is when
of what you wish to convey. This includes Make it interesting tences.
you have used the same word
the background, a few points, implications, Your goal is to be read. So, it is your re-
multiple times. Redundancy is
and actions. Making an outline bypasses sponsibility to make it interesting for the
when you have repeated a point
your resistance to writing and gets you reader. Darius Foroux, the productivity
THE WRITER IS FOUNDER elsewhere, maybe using the
moving. It also gives you clarity of thought blogger, has two tips. Firstly, remove all
AND CEO AT QUEZX.COM same words.
and builds a strong foundation for the ac- clichés from your writing like – in order to, AND HEADHONCHOS.COM.
tual output. to conclude, I am pleased to share etc. They
The Economic Times Wealth
SMART STATS
May 18-24, 2020
In This Section
MUTUAL FUNDS - P18
LOANS AND DEPOSITS - P20
ALTERNATE INVESTMENTS- P21
KEC International 1 1 194.60 23.23 31.92 10.27 2.05 3.07 0.33 2.19 1.15 34 4.74
1 Fast growing stocks
Power Grid Corp of India 2 2 160.80 13.31 21.93 6.71 1.43 5.08 0.31 1.43 0.59 27 4.70
Top 5 stocks with the highest
HG Infra Engineering 3 3 170.45 41.94 72.67 8.69 1.67 0.29 0.14 2.40 1.00 16 5.00 expected revenue % growth
JK Cement 4 4 1,091.35 15.46 70.89 29.40 3.10 1.54 0.47 1.65 0.71 28 4.79 over the previous year
JSW Energy 5 5 40.15 2.57 32.84 9.50 0.56 2.47 0.27 1.79 0.60 16 4.81 HG Infra
42
Engineering
Emami 6 6 183.35 9.51 78.88 27.19 3.97 4.37 0.32 1.81 0.67 33 4.03
Bayer 42
Birla Corp 7 7 399.25 9.35 54.11 11.91 0.68 1.89 0.29 2.14 0.98 11 5.00 CropScience
Alkem Laboratories 8 9 2,527.10 29.33 78.06 39.47 5.52 1.21 0.52 1.30 0.36 21 4.24 Ajanta Pharma 40
Engineers India 9 8 63.35 22.24 17.53 10.75 1.69 6.63 0.51 1.94 0.61 15 4.47 Ipca
39
Laboratories
Sun Pharmaceutical 10 10 455.95 24.00 48.60 41.23 2.65 1.27 0.88 1.61 0.62 40 3.92
Info Edge India 32
ITC 11 11 163.80 10.13 26.01 15.87 3.39 3.48 0.61 1.76 0.82 38 4.53
Manappuram Finance 12 13 123.05 2.23 73.82 11.31 2.31 1.81 0.16 2.84 1.57 14 4.64
Larsen & Toubro 13 12 871.65 15.61 13.42 13.35 1.91 3.24 0.91 1.83 1.08 43 4.77
2 Least expensive stocks
Sterlite Technologies 14 -- 100.10 17.50 19.70 9.10 2.09 3.47 0.36 2.86 0.84 11 4.64 Top 5 stocks with the lowest
NTPC 15 21 89.35 18.68 10.01 5.84 0.81 0.54 0.65 1.52 0.72 27 4.93
price-earnings ratio
Ipca Laboratories 16 15 1,594.35 39.01 84.33 45.35 6.46 0.33 0.55 1.50 0.16 24 4.13 NTPC
5.84
CCL Products India 17 18 187.10 21.16 24.06 16.15 2.98 3.54 0.67 1.75 0.83 10 4.80
Dilip Buildcon 6.24
Gujarat Gas 18 16 241.70 31.81 142.01 40.22 7.63 0.41 0.27 1.83 0.82 30 3.97
Redington
6.55
Mphasis 19 22 803.40 23.07 10.95 12.61 2.56 3.36 0.92 1.64 0.77 34 4.26 India
APL Apollo Tubes 20 -- 1,220.40 18.61 55.77 19.45 3.01 1.12 0.41 2.21 1.23 10 4.60 CESC 6.65
UltraTech Cement 21 14 3,609.50 18.09 65.50 40.42 3.47 0.32 0.82 1.71 0.91 43 4.47 Power Grid 6.71
Corp of India
Jubilant Life Sciences 22 20 449.95 10.18 27.61 12.21 1.49 2.22 0.46 2.36 1.02 13 4.54
Cipla 23 26 569.75 13.29 29.11 29.98 3.05 0.70 1.05 1.33 0.32 43 4.39
3 Best PEGs
Essel Propack 24 25 171.75 14.08 48.52 28.04 3.90 1.45 0.58 2.12 0.70 11 4.55
Top 5 stocks with the least
Crompton Greaves Cons. 25 23 208.15 14.59 41.50 32.50 11.88 0.93 0.79 1.51 0.64 37 4.59 price-earnings to growth ratio
Aurobindo Pharma 26 28 665.60 28.22 24.13 16.42 2.79 0.44 0.68 2.87 0.92 35 4.60 Manappuram
Finance Gujarat Gas
CESC 27 30 591.80 11.70 8.04 6.65 0.88 3.36 1.14 1.75 0.72 18 4.94
Mahanagar Gas 28 27 902.00 0.66 32.57 16.34 3.72 2.17 0.45 1.87 0.95 30 4.20
0.14 0.16 0.27 0.27 0.29
Ajanta Pharma 29 29 1,494.45 39.73 44.28 33.61 5.79 0.90 0.78 1.64 0.65 12 4.33
Pfizer 30 31 4,413.45 17.70 40.31 47.13 6.71 7.81 1.17 1.41 0.35 10 4.60
HG Infra JSW Energy Birla Corp
Transport Corp of India 31 33 155.75 11.81 19.72 8.31 1.35 1.26 0.53 1.97 0.96 10 4.90 Engineering
Century Plyboards India 32 19 119.45 5.62 40.35 17.60 2.68 0.89 0.59 1.91 0.76 20 4.45
Dilip Buildcon 33 32 255.35 21.51 20.02 6.24 1.21 0.39 0.31 2.73 1.28 15 4.53 4 Income generators
Dr Reddy's Laboratories 34 35 3,732.00 22.13 29.20 32.96 4.42 0.53 1.06 1.23 0.32 47 3.60 Top 5 stocks with the highest
Thermax 35 38 700.05 1.84 34.61 24.22 2.77 1.99 0.72 1.37 0.41 32 2.94
dividend yield (%)
Redington India 8.74
Heidelberg Cement India 36 34 154.10 8.21 27.05 15.74 2.97 0.95 0.53 2.03 1.03 15 4.60
Pfizer 7.81
VRL Logistics 37 41 153.75 7.80 17.90 15.25 2.17 4.50 0.93 1.81 0.71 15 4.33
Engineers India 6.63
Torrent Pharmaceuticals 38 45 2,408.50 15.08 71.53 93.06 8.59 1.50 1.30 1.48 0.43 34 3.38 Power Grid
Corp of India 5.08
Bayer CropScience 39 50 4,500.25 41.81 146.10 65.46 8.26 0.40 0.71 1.52 0.59 10 3.80
VRL Logistics 4.50
Info Edge India 40 44 2,695.80 32.43 50.74 53.74 12.77 0.31 0.40 2.11 0.74 27 3.30
Coromandel International 41 46 615.70 5.57 45.30 24.76 5.31 0.57 0.55 1.49 0.74 15 4.33
5 Least risky
SRF 42 -- 3,651.60 14.12 44.90 32.46 5.04 0.39 0.69 2.01 1.13 21 4.38
Top 5 stocks with the lowest
Apollo Hospitals 43 -- 1,294.40 24.61 44.59 76.31 5.40 0.51 1.40 1.93 0.99 23 4.87 downside risk
Blue Star 44 37 469.95 10.09 24.96 31.53 5.79 4.22 0.96 1.71 0.82 25 3.80 Alkem
Laboratories Thermax
Lupin 45 48 863.05 3.53 54.24 63.72 2.81 0.60 1.16 1.38 0.33 46 2.98
Tata Consumer Products 46 49 362.80 27.61 70.81 55.76 3.11 0.70 1.32 1.93 1.03 11 4.36
1.23 1.30 1.33 1.37 1.38
Carborundum Universal 47 -- 209.65 12.64 22.76 15.92 2.29 1.86 0.99 1.80 0.91 11 4.27
Redington India 48 -- 84.00 19.05 0.74 6.55 0.84 8.74 46.95 2.62 0.91 10 4.80
Dr Reddy's Cipla Lupin
Ramco Cements 49 -- 549.00 12.09 26.71 23.83 2.85 0.99 1.14 1.68 0.86 28 3.71 Laboratories
Prestige Estates Projects 50 -- 157.00 27.51 6.03 14.05 1.38 1.94 3.24 2.98 1.03 18 4.78 SEE DOWNSIDE RISK AND BEAR BETA COLUMNS
IN THE ADJACENT TABLE.
*REVENUE AND NET PROFIT GROWTH IS BASED ON CONSENSUS ANALYSTS' EXPECTATIONS. NR: NOT IN THE RANKING. DATA AS ON 14 MAY 2020. SOURCE: BLOOMBERG
smart stats
18 The Economic Times Wealth May 18-24, 2020
LAGGARDS LEADERS
ET Wealth collaborates with Value Research to identify the top-performing Equity: Large-cap 5-year returns
funds across categories. Equity funds and equity-oriented hybrid funds are
-0.11 7.41
ranked on 3-year returns while debt-oriented hybrid and income funds are Taurus Largecap Equity Axis Bluechip
ranked on 1-year returns. 0.07 6.37
Principal Nifty 100 Equal Weight Canara Robeco Bluechip Equity
1.42 6.05
Franklin India Bluechip Mirae Asset Large Cap
Value Research Net Assets
RETURNS (%)
Expense 1.6 5.06
Fund Rating (` Cr) 3-Month 6-Month 1-Year 3-Year 5-Year Ratio (%) Baroda Large Cap SBI ETF Nifty Next 50
1.87 4.96
EQUITY: LARGE CAP
Axis Bluechip Fund 12,716.81 -19.99 -14.63 -2.99 7.17 7.41 1.98
7.17% Nippon India Large Cap Nippon India ETF Shariah BeES
Canara Robeco Bluechip Equity Fund* 418.00 -17.94 -11.96 -1.69 4.01 6.37 2.42 THE 3-YEAR
HDFC Index Fund 1,177.38 -22.86 -20.42 -13.30 2.64 4.18 0.30
RETURN
Tata Index Sensex Fund* 23.61 -22.52 -20.11 -13.00 2.63 3.82 0.46
OF AXIS
BLUECHIP IS
Equity: Multi-cap 5-year returns
Sundaram Select Focus Fund* 932.85 -20.73 -16.75 -9.04 2.47 4.92 2.33 THE HIGHEST
UTI Nifty Index Fund* 2,097.08 -22.96 -20.81 -15.14 0.92 3.58 0.17 IN ITS -1.72 7.79
Edelweiss Large Cap Fund 165.33 -22.78 -19.09 -12.05 0.72 3.32 2.44 CATEGORY. Nippon India Multi Cap Axis Focused 25
Motilal Oswal Focused 25 Fund * 1,153.47 -18.92 -14.63 -2.62 0.71 4.83 2.27
-1.09 7.68
Mirae Asset Large Cap Fund * 15,347.16 -22.67 -20.21 -13.84 0.47 6.05 1.65
Nippon India Retirement Parag Parikh Long Term Equity
ICICI Prudential Bluechip Fund* 21,820.93 -21.60 -19.19 -13.92 -0.29 4.00 2.05
Indiabulls Bluechip Fund* 127.95 -23.80 -21.59 -14.87 -1.73 4.06 2.43 -0.8 7.54
Taurus Starshare SBI Focused Equity
EQUITY: LARGE & MIDCAP 0.07 7.13
Invesco India Growth Opportunities Fund* 2,282.43 -22.63 -18.84 -10.12 1.62 5.05 1.93 1.62% HDFC Focused 30 Tata Retirement Savings
Mirae Asset Emerging Bluechip Fund* 8,838.98 -20.91 -16.15 -6.92 1.03 10.28 1.73 THE 3-YEAR
Kotak Equity Opportunities Fund 2,980.18 -22.33 -16.27 -8.85 -0.95 5.41 2.10 RETURN OF 0.52 6.52
INVESCO IN- LIC MF Multicap IIFL Focused Equity
Canara Robeco Emerging Equities Fund 4,845.74 -21.98 -13.32 -9.57 -1.36 7.70 1.90
DIA GROWTH
LIC MF Large & Mid Cap Fund* 594.43 -24.81 -19.12 -9.25 -1.56 5.59 2.45 OPPORTUNI-
Sundaram Large and Mid Cap Fund* 1,012.99 -27.67 -24.66 -16.03 -1.61 4.53 2.09 TIES FUND IS
DSP Equity Opportunities Fund 4,439.07 -23.54 -19.22 -11.23 -2.23 5.24 1.96 THE HIGHEST
IN ITS
Equity: Mid-cap 3-year returns
Principal Emerging Bluechip Fund 1,822.03 -22.19 -15.06 -9.54 -2.25 5.85 2.18
CATEGORY.
-11 6.78
EQUITY: MULTI CAP
Aditya Birla Sun Life Mid Cap Axis Midcap Fund
Parag Parikh Long Term Equity Fund 2,925.43 -14.51 -8.20 -1.64 6.37 7.68 2.09
SBI Focused Equity Fund* 7,967.80 -21.93 -14.61 -8.14 4.59 7.54 1.80 -10.06 0.13
Canara Robeco Equity Diversified Fund 1,896.90 -19.04 -12.03 -5.16 3.24 5.61 2.25 Motilal Oswal Midcap 100 Exchange Quant Mid Cap Fund
Axis Focused 25 Fund 9,493.38 -23.99 -18.54 -6.10 2.84 7.79 1.73 -9.61 -2.11
IIFL Focused Equity Fund 785.87 -23.31 -15.58 -3.88 2.69 6.52 2.30
Sundaram Mid Cap DSP Midcap
Tata Retirement Savings Fund 689.21 -19.00 -15.56 -6.12 0.88 7.13 3.77
Kotak Standard Multicap Fund 26,049.43 -23.28 -19.88 -13.40 -0.97 5.79 1.70
-9 -2.75
Edelweiss Multi Cap Fund 488.67 -23.94 -19.47 -14.60 -1.43 4.45 2.46 SBI Magnum Midcap Tata Midcap Growth
JM Multicap Fund 118.78 -24.64 -21.90 -11.72 -1.48 4.72 — -8.36 -3.3
SBI Magnum Multicap Fund* 7,912.14 -24.36 -21.53 -15.33 -1.96 4.75 1.86 IDBI Midcap Edelweiss Mid Cap
Motilal Oswal Multicap 35 Fund* 10,236.93 -25.46 -22.66 -16.74 -4.42 4.66 1.18
Methodology
The Top 100 includes only those funds that have a 5- or
4-star rating from Value Research. The rating is determined
EQUITIES (figures over the past one year)
Large-cap: Mostly invested in large-cap companies.
4 Debt: Low duration
by subtracting a fund’s risk score from its return score.
The result is assigned stars according to the following
Multi-cap: Mostly invested in large- and mid-cap
companies. FUND 0.55 0.55
distribution:
0.38
Next 22.5% Tax planning: Offer tax rebate under Section 80C.
(Not covered
4.5%
Middle 35% in ETW Funds International: More than 65% of assets invested abroad.
Next 22.5% 100 listing) Income: Average maturity varies according to objective.
Bottom 10% Gilt: Medium- and long-term; invest in gilt securities.
Fixed-income funds less than 18 months old and equity funds Equity-oriented: Average equity exposure more of the total AUM of
less than three years old have been excluded. This ensures than 60%.
equity funds was UTI Treas- IDFC Low ICICI Canara DSP Low
that all the funds have existed long enough to be tracked for Debt-oriented aggressive: Average equity exposure Pru-
in cash and cash ury Ad- Duration Robeco Duration
consistency of performance. Given the focus on long-term between 25-60%. dential Savings
vantage
investing, liquid funds, short-term funds and FMPs are not equivalents in April Savings
part of the list. For the same reason, we have considered only Debt-oriented conservative: Average equity exposure
less than 25%. 2020 as compared to
the growth option of funds that reinvest returns instead of
offering dividends that increase the NAV of funds. Arbitrage: Seek arbitrage opportunities between equity 3.4% in April 2019.
and derivatives. % AS ON 31 MAR 2020
Despite these rigorous filters, the list includes 2/3 funds of % EXPENSE RATIO IS CHARGED ANNUALLY.
each category to maximise choice from the best funds. Asset allocation: Invest fully in equity or debt as per METHODOLOGY OF TOP 100 FUNDS ON
The fund categories are: market conditions. WWW.WEALTH.ECONOMICTIMES.COM
loans and deposits
20 The Economic Times Wealth May 18-24, 2020
TENURE: 3 YEARS UCO Bank 7.30 7.30 7.40 7.30 7.40 28 Mar 2020
AU Small Finance Bank 7.53 12,508 Punjab & Sind Bank 7.30 7.30 7.65 7.30 7.65 16 April 2020
RBL Bank 7.50 12,497 Canara Bank 7.30 7.35 9.30 7.35 9.30 7 April 2020
DCB Bank 7.35 12,442
IDFC First Bank 7.40 7.40 11.40 7.40 11.40
IDFC First Bank 7.25 12,406
SBI Max Gain 7.05 7.45 7.80 7.60 7.95 1 April 2020
Ujjivan Small Finance Bank 7.25 12,406
Indian Overseas Bank 7.25 7.45 7.70 7.45 7.70 14 April 2020
TENURE: 5 YEARS
DCB Bank 7.35 14,393 Indian Bank 7.20 7.55 7.85 7.60 7.90 1 April 2020
IDFC First Bank 7.25 14,323 J & K Bank 7.60 7.70 8.00 7.70 8.00 28 Mar 2020
AU Small Finance Bank 7.25 14,323 Union Bank of India 7.20 8.05 8.35 8.05 8.35 1 April 2020
RBL Bank 7.15 14,252
ICICI Bank 8.10 8.10 9.10 8.35 9.20 1 April 2020
Ujjivan Small Finance Bank 6.75 13,975
Karur Vysya Bank 7.60 8.20 10.05 8.20 10.05 1 April 2020
Bank of Maharashtra 7.45 8.20 9.00 8.45 9.35 7 April 2020
Kotak Mahindra Bank 8.20 8.20 9.15 8.30 9.25 16 April 2020
Top five senior citizen bank FDs
Interest rate (%) What `10,000
Bank of Baroda 7.25 8.25 8.50 8.25 8.50 28 Mar 2020
TENURE: 1 YEAR compounded qtrly will grow to
IDBI Bank 7.80 8.25 8.60 8.45 9.00 12 April 2020
Ujjivan Small Finance Bank 8.00 10,824
Dhanlaxmi Bank 7.93 8.25 8.90 8.75 9.40 5 May 2020
IDFC First Bank 7.75 10,798
RBL Bank 7.70 10,793 Federal Bank 8.35 8.35 8.45 8.40 8.50 16 April 2020
Indusind Bank 7.50 10,771
AU Small Finance Bank 7.25 10,745
TENURE: 5 YEARS
Post office deposits Interest (%)
Minimum
investment (`)
Maximum
investment (`)
Features
Tax
benefits
Kisan Vikas Patra 6.90 1,000 No limit Can be encashed after 2.5 years Nil
Top five tax-saving bank FDs 5-year NSC VIII Issue 6.80 100 No limit No TDS 80C
Interest What `10,000
TENURE: 5 YEARS AND ABOVE rate (%) will grow to Time deposit 5.50-6.70 200 No limit Available in 1, 2, 3, 5 year tenures 80C#
DCB Bank 7.35 14,393
Single 4.5 lakh 5-year tenure, monthly returns Nil
IDFC First Bank 7.25 14,323 Post Office Monthly Income
6.60 1,500
Scheme
AU Small Finance Bank 7.25 14,323 Joint 9 lakh 5-year tenure, monthly returns Nil
RBL Bank 7.15 14,252
Recurring deposits 5.80 10 No limit 5-year tenure Nil
Ujjivan Small Finance Bank 6.75 13,975
Savings account 4.00 20 No limit `10,000 interest tax-free Nil
ALL DATA SOURCED FROM ECONOMIC TIMES INTELLIGENCE GROUP
(ETIGDB@TIMESGROUP.COM) Data as on 14 May 2020 # Benefit available only for 5-year deposit
market watch
The Economic Times Wealth May 18-24, 2020 21
Aug '19
Mar '20
37,319 31,123 7.38 6.06 70.42 75.56
Sep '19
Oct '19
3.2
14 MAY 2019 14 MAY 2019 14 MAY 2019 2.1 2.0
14 MAY 2020 14 MAY 2020 14 MAY 2020 1.3
0.1
` PER DOLL AR
Apr '19
May '19
Jun '19
Jul '19
Nov '19
Jan '20
Feb '20
Dec '19
-1.4
-4.6
-6.6
-16.7
CHANGE
X 1 WEEK -1.02% 1 WEEK 2.90 (bps) 1 WEEK -0.37% LATEST -16.70%
X 1 YEAR -16.60% 1 YEAR -131.90 (bps) 1 YEAR 7.30% 1-YEAR AVG -0.60%
Markets continued to remain under pressure Bond yields increased marginally Rupee gained due to the increased IIP contracted by -16.7% in March 2020
due to heavy selling in IT stocks, Fed's on the expectations that the stimulus volatility in the dollar index and due to the weak performance by the
expectation of grim US economic outlook, and package could lead to an increase in positive expectations from the mining, manufacturing and electricity
investors weak response to the first tranche of government borrowings. government's rescue package. sectors amid nationwide lockdown.
government's 'Atma Nirbhar Bharat' package.
Siti Networks 1.81 25.69 158.57 1.84 -64.88 157.85 Prismx Global Ventures 8.46 -9.32 -47.29 0.01 16,558.25 24.02
Opto Circuits (India) 5.90 27.16 152.14 3.83 226.72 177.37 DB Int. Stock Brokers 8.05 -9.65 -14.36 - 12,050.00 28.18
Sanwaria Consumer 3.55 26.79 151.77 8.87 225.84 261.32 Uttam Value Steels 0.23 9.52 21.05 30.93 4,761.22 151.99
Educomp Solutions 2.95 26.61 145.83 0.37 208.06 36.12 KSS 0.19 -5.00 - 12.41 3,784.23 39.51
Arcotech 2.20 21.55 115.69 0.09 -17.68 23.10 Yamini Investment 0.20 5.26 5.26 0.75 3,757.87 10.51
Vikas Ecotech 2.65 9.50 115.45 3.20 45.82 80.98 Beardsell 9.00 -0.44 33.33 0.03 3,022.04 25.29
SE Power 3.66 -5.91 114.04 0.44 1,126.92 14.86 Vikas Proppant 2.74 -8.36 -47.81 23.61 2,541.01 138.70
Vikas Multicorp 2.09 5.56 106.93 1.89 32.23 138.67 ISMT 3.45 -12.66 16.95 1.62 1,866.42 50.54
Hindustan Fluorocarbons 6.40 13.27 100.00 0.03 58.26 12.54 Maximaa Systems 3.00 -1.64 33.33 0.03 1,432.45 17.40
Atlanta 6.46 -5.00 86.71 0.03 -13.06 52.65 Transcorp International 6.88 -2.55 -31.20 0.09 1,362.73 21.88
THE STOCKS HAVE BEEN SELECTED USING THE FOLLOWING FILTERS: PRICE LESS THAN `10, ONE-MONTH AVERAGE VOLUME GREATER THAN OR EQUAL TO 1 LAKH AND MARKET
CAPITALISATION GREATER THAN OR EQUAL TO `10 CRORE. DATA AS ON 14 MAY 2020. SOURCE: ETIG DATABASE AND BLOOMBERG.
pick of the week
22 The Economic Times Wealth May 18-24, 2020
G
ujarat State Petronet Limited (GSPL), the second international LNG prices and increased demand. However,
largest gas transmission company in India, has more terminals, like Swan Energy’s LNG terminal that is
Fundamentals
reacted negatively to Covid-19 fears. Though the expected to start in April 2021, are coming up and this should CONSENSUS
ACTUAL
ESTIMATE
gas transmission industry won’t be affected by help GSPL in increasing its transmission volumes.
2017-18 2018-19 2019-20 2020-21
the pandemic disruptions, its transmission vol- City gas distribution is going to be another driver for GSPL’s
Revenue (` cr) 7,213.26 9,307.67 11,439.75 12,370.90
ume may come down due to disturbances in user industries. volume growth in the coming years. In the last round, sev-
However, analysts believe that this negative impact will be eral new geographical areas have been allocated in Gujarat. Ebitda (` cr) 2,063.45 2,541.73 3,111.60 3,243.23
limited for GSPL. Companies in these new areas have to do groundwork before Net profit (` cr) 754.98 999.65 1,482.93 1,486.30
Resumption of operations by starting the distribution of CNG EPS (`) 13.38 17.72 26.78 27.05
user industries, like ceramic, and piped natural gas (PNG) to DIVIDEND
fertiliser, chemical, etc. after Analysts’ views the consumers. In addition to in- Valuations PBV PE YIELD (%)
partial lifting of lockdown re- creasing its volumes, increased Gujarat State Petronet 3.13 6.62 1.09
strictions, is a positive factor for 27 gas consumption by its city gas
GSPL. Besides, negative impact 3 Buy distribution subsidiary, Gujarat
GAIL (India) 0.84 6.20 4.17
Blue Star managed to retain its 12.5% market-share in room ACs. It has now upgraded to buy since it
Blue Star Anand Rathi Buy 470 626 33 is expected to improve further due to its business model and balance sheet-focused approach.
Though non-gold portfolio remains worrisome, Manappuram should be better off because around
Manappuram Finance IDBI Capital Buy 123 160 30 67% of its AUM is from gold loan, a segment that will do well during troubled times.
Adani Gas added 33 CNG stations in 2019-20 taking its total count to 115. Its future volume growth
Adani Gas ICICI Direct Buy 106 130 22 should also be stable because of continued strong capex along with favourable regulatory scenario.
Though Maruti will be negatively impacted in short term, it should hold the pole position in the
Maruti Suzuki Emkay Buy 5,110 6,173 21 market, owing to increasing share of petrol vehicles, focus on new products and network expansion.
Despite Covid-19 induced disturbances, Coromandel is expected to benefit from 22% higher pre-
Coromandel International Motilal Oswal Buy 616 738 20 season rainfall across India, good water storage and favorable shift in crop pattern in its market.
ABB business model is highly sensitive to operating leverage and `320 crore revenue shortfall for 10
ABB India HDFC Sec Sell 836 755 -10 days of disruption in Mar-2020 led to sharp erosion in profitability (`110 crore contribution shortfall).
While demand for Havells' consumer portfolio is expected to bounce back faster, B2B segments will
Havells India Prabhudas Lilladher Reduce 501 485 -3 remain a near term drag due to longer recovery cycle in industrial products.
mutual funds
The Economic Times Wealth May 18-24, 2020 23
ARINDAM
investors
know
Vijaya and Deepak Tyagi are saving for their kids’ goals and retirement. Here’s the doctor’s advice: whether
they have
1 2 3 4
FIRST CHILD’S FIRST CHILD’S HIGHER FIRST CHILD’S SECOND CHILD’S
invested in
GOALS
EDUCATION: 6 yrs EDUCATION: 10 yrs MARRIAGE: 14 yrs EDUCATION: 17 yrs the right
PRESENT COST: `12 lakh PRESENT COST: `50 lakh PRESENT COST: `28 lakh PRESENT COST: `12 lakh funds and if their
FUTURE COST: `21.25 lakh TOTAL COST: `1.3 crore FUTURE COST: `72.2 lakh FUTURE COST: `60.1 lakh fund portfolio is on
track. The Portfolio
5 6 7 Doctor assesses the
SECOND CHILD’S HIGHER EDUCATION: 21 yrs SECOND CHILD’S MARRIAGE: 25 yrs RETIREMENT INCOME: 21 yrs
health of the fund
CURRENT NEED: `50 lakh CURRENT NEED: `28 lakh CURRENT NEED: `1.41 crore (`70,000 per month)
CORPUS REQUIRED: `3.7 crore CORPUS REQUIRED: `1.5 crore CORPUS REQUIRED: `5.8 crore
portfolio, examines the
schemes and their
suitability with regard to
PORTFOLIO FUND NAME AMOUNT
INVESTED (`)
EXISTING
SIP (`) RECOMMENDED ACTION NEW SIP
(`)
the goals and, if
CHECK-UP required, recommends
Investing in IDBI Nifty Index 18,587 0 Shift corpus to multi-cap fund SBI Focused Equity. 0 corrective measures. The
mutual funds for advice given is based on
Switch to multi-cap SBI Focused Equity. Hike SIP
the past 7-8 years. 1 SBI Bluechip 81,406 5,000 amount by 10% every year. 5,000
Hold too many
the performance of the
funds. Need to HDFC Hybrid Equity 2,24,350
Fund is down but holds promise. Increase SIPs to
2,000 `6,000 and hike by 10% every year. 6,000
funds, the risk profile of
streamline the investor as well as
portfolio.
ICICI Pru Bluechip 2,61,282
Switch to multi-cap ICICI Pru Focused Equity.
4,000 Increase SIP to `12,000 and hike 10% every year. 12,000 his financial goals.
Goals are
ambitious. Must
increase monthly Shift corpus to multi-cap ICICI Pru Focused Equity to
Franklin India Bluechip 1,05,737 0 consolidate portfolio. 0 Assumptions used
investment by
`24,000. in the calculations
2 ICICI Pru US Bluechip Equity 25,967
Fund offers global diversification. Increase SIPs to
1,500 `5,000 and hike by 10% every year. 5,000
All SIPs will also INFLATION
have to be hiked Education For all
by 10% every year Sukanya Samridhhi Account 2,22,000 7,000 Keep contributing to this small savings scheme and 7,000 expenses other goals
to reach goals. to the life insurance policy. Use the maturity
LIC policy NA 2,200 proceeds for education expenses. 2,200
Some goals can be
downsized if not
10% 7%
Fund has slipped. Shift corpus systematically to
possible to IDFC Multicap 2,17,659 0 0
increase SIPs.
Mirae Asset Hybrid Equity. RETURNS
Equity funds Debt options
Increase SIPs to `3,000 in this outperforming large
Note from 3 Mirae Asset Emerging Bluechip 15,578 2,500 and midcap fund. Hike by 10% every year. 3,000
the doctor
Continue SIPs in this hybrid fund and hike by 10%
12% 8%
Take loan for Mirae Asset Hybrid Equity 10,999 5,000 every year. 5,000
children’s
education but
Switch to Axis Bluechip and start SIPs of `4,000. Hike
keep retirement 4 Nippon India Equity Hybrid 1,38,793 0 by 10% every year. 4,000 PORTFOLIOS
savings intact. ANALYSED BY
Switch to multicap scheme Aditya Birla SL Equity. RAJ KHOSLA,
Avoid using Aditya Birla SL Frontline Equity 90,454 8,000 Hike SIPs by 10% every year. 8,000
Managing Director
insurance as an
and Founder,
investment. Fund has underperformed. Switch to Axis Focused 25 MyMoneyMantra
Returns from 5 Nippon India Large Cap 1,43,217 3,500 and hike SIP by 10% every year. 3,500
plans are too low.
Both husband HDFC Children's Gift 34,595
Continue SIPs in this stable hybrid fund and hike by
3,000 10% every year. 3,000 WRITE
and wife should TO US
buy term covers Canara Robeco Emerging
of at least `1
6
Equities
0
Start SIPs of `4000 in Canara Robeco Emerging
0 Equities. Hike amount by 10% every year. 4,000 FOR HELP
crore each. If you want your portfolio examined,
write to etwealth@timesgroup.com
Review Mirae Asset Large Cap 15,520 7,000 7,000 with “Portfolio Doctor” as the subject.
Continue SIPs in this outperforming large-cap and
investments and ELSS fund. Hike by 10% every year. Mention the following information:
rebalance at least Axis Long Term Equity 1,71,950 4,000 4,000 Names of the funds you hold.
once in a year. 7 Current value of the investment.
If you have SIPs running in any
NPS 76,903 5,576 5,576
Reduce risk when Keep contributing; hike by 5% every year. Don't of them.
goal is near so The financial goals for which you
withdraw before retirement.
Provident Fund and PPF 19,10,500 16,052 16,052 invested.
that you don’t How much you need for each
miss the target. financial goal.
The goals can be reached using the mutual
TOTAL `37,65,497 `76,328 funds marked in the same colour. `1,00,328 How far away is each goal.
your feedback & more...
24 The Economic Times Wealth May 18-24, 2020
Readers’ response, online and in print, to ET Wealth stories has been enlightening.
We pick some that add information and perspective to our articles from previous issues.
This refers to the cover story, ‘How requirement. Our exports are not
Covid is forcing Indians to rejig their picking up, even though the rupee has
goals’. There will be many stories of
misery and despair. Cash is going to
Start making do depreciated against the US dollar. Our
current account deficit is increasing. We
be king despite lower returns in bank
interest. Prudence will be supreme.
with less cannot afford to consume so much of
fuel in our country. There is no question
Discretionary spends, luxury of passing any benefits in crude oil
In reference to the cover story, ‘How Covid
holidays and renovations will be put price reductions to consumers as it
is forcing Indians too rejig their goals’,
on the back-burner. Buying a home would only make them consume more.
I think thrift will be the key word in the
will be a good idea for only a few and S. Kalyanaraman
post-Corona era. We will face huge budget
job security would be threatened.
deficits and hyper inflation. Spending a lot
There will be no improvement till the The survey, ‘How Covid has hit
on education will not help as it would not
government reduces GST to stimulate homebuyers’, was informative. Large
guarantee high paying jobs. The solution
consumption. and reputed builders who have unsold
will lie in adopting a simple lifestyle and
Hemant Pisat inventory must offer a discount of at
toning down expectations.
least 30% to induce buyers.
Vilas Save
For us retired people who have no N.H. Rao
pension, our only prayer is that our
money in the banks remain intact. In The column, ‘A higher order of
these uncertain times, one can’t help not last. Many pharma companies have the country also reveals the weakness in coexistence’, was wonderful. I am a
but be worried about one’s money. not fixed the underlying quality and pharma supply chains. There is much work regular reader of ET Wealth. I find Uma
Subbu, India compliance issues that have periodically to be done for pharma stocks to deserve out- Shashikant’s columns enlightening. Her
caught USFDA’s attention. Further, they performance. way of assessing points related to
The article, ‘Can pharma stocks have failed to substantially invest in R&D Nandkumar Venkatachary earning, saving and investing are
continue to outperform?’ provided and sooner or later, the pharma sector educative. The language is clear and
interesting insights. While pharma will revert to its usual role of imitating This refers to the column, ‘Once again, govt simple. She is a worthy teacher of
seems to have fared better than MNC products. The scarcity of medicines goes back on oil price reforms’. India has to economics. Wishing her every success.
other sectors, the good times may during the lockdown in different parts of import more than 80% of its crude oil D. Yadaiah
SUPPLY BY BHK
LOCALITY SNAPSHOT
4%
LAXMI NAGAR-PATPARGANJ, DELHI 1 BHK
Established area in East Delhi having ample residential options along with good social & retail infra 2 BHK 35%
Proximity to key job hub of Noida and sound overall connectivity makes it a preferred residential area
A popular commercial centre with many electronic showrooms, coaching centres, malls and offices 3 BHK 52%
Key infra - Mayo International School, Max Super Speciality Hospital, V3S Mall, Cinepolis Cinemas, etc.
Well-connected through Vikas Marg, Delhi-Meerut Expy, Noida Link Rd and Blue & Pink Metro Lines 4 BHK 9%
Preet Vihar Consumer preference by
Laxmi Nagar PRICE RANGE VALUES budget segment (`)
Patparganj `4,700-16,800 per sq ft
6%
LOCALITY Price Rent 9% Below 50 lakh
IP Extension
Shakarpur (`/sqft) (`/month) 50 lakh-1 crore
28% 1-1.5 crore
Indraprastha 8,200-12,000 20,000-29,000 11% 1.5-2 crore
Extension 2-2.5 crore
24% 22%
Airport: 26 km Above 2.5 crore
Railway station: Laxmi Nagar 4,900-7,500 12,000-20,000
4 km Consumer preference by
Expressway: covered area (sq ft)
3 km Patparganj 8,200-12,300 18,000-26,000 11% Below 750
1 BHK 2 BHK 3 BHK 4 BHK
480 sq ft 870 sq ft 1,400 sq ft 2,350 sq ft 12% 16% 750-1,000
Shakarpur 4,700-7,100 10,000-17,000 1,000-1,250
`30
lakh (avg)
`80
lakh (avg)
1.70
`crore (avg)
3.40
`crore (avg)
20%
17% 1,250-1,500
1,500-1,750
Preet Vihar 12,300-16,800 19,000-30,000 24%
Above 1,750
Schools 16+ Hospitals 14+ Restaurants 20+ Banks 18+ Grocery Stores 17+ Petrol Pumps 10+ In dia’s No. 1 P ropert y Sit e
The Economic Times Wealth is available at an invitation price of `8/issue. To book your copy, contact your newspaper vendor or call 022-39898090; Email: crm.mumbai@timesgroup.com; SMS ETWS to 58888
The Economic Times Wealth, published by Bennett, Coleman & Co. Ltd. exercises due care and caution in collecting the data PUBLISHED FOR THE PROPRIETORS, Bennett, Coleman & Co Ltd by R.Krishnamurthy at The Times of India Building, Dr. D.N. Road, Mumbai 400001. Tel. No.: (022) 6635 3535,
before publication. In spite of this, if any omission, inaccuracy or printing errors occur with regard to the data contained in this 2273 3535. Fax: (022) 2273 2544 and printed by him at (1) The Times of India Suburban Press, Akurli Road, Western Express Highway, Kandivli (E), Mumbai-400101 . Tel. No.:
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recommended to make appropriate enquiries and seek appropriate advice before making any specific or other decisions. reserved. RNI No.: MAHENG/2014/57046. VOLUME 07 NO. 20