To,Date: Mar10th, 2016

The Trustee

Subject: Proposal for Investment in Mutual Funds

Sir,

We find privilege of being associated as one of the empanelled arranger for investments of the trust. With reference to the subject stated above, we would like to highlight the following mutual fund investment options opened up by the revised investment guidelines:-

Category No / Category/ Sub category / Amount to be Invested %
Category (i) (c) / Gilt Mutual Funds / Upto 5%
Category (ii) (e) / Debt Mutual Funds / Upto 5%
Category (iii) (b) / Liquid Mutual Funds / Upto 5%
Category (iv) / Equity Mutual Funds / Min 5% to 15%

Introduction

With the dynamic investment environment and falling interest rate scenario, it is becoming difficult for trustees to generate returns on retirement corpus in line with the administered rate. Accordingly, the revised guidelines for all retirement funds allow investment in actively managed Mutual Funds to an extent of 5% to 30% of portfolio.

The relatively stringent credit qualifying parameters, continuous surveillance mechanism and active management allows Mutual funds to deliver alpha in each asset class while maintaining adequate safety of portfolio. Furthermore, the open ended nature of these products offers an enhanced liquidity profile to retirement funds to mitigate any liquidity risk.

Accordingly, we have shortlistedbelow a list of schemes across all categories for your kind perusal:-

Category (i) (c) / Recommended Gilt Funds as of March 2016
Scheme / Corpus (INR Crs) / Exit Load / Mod Duration
(Years) / Avg Maturity (Years) / Returns
6 Mth / 1 Yr / 3 Yrs / 5 Yrs
Reliance G Sec Fund / 1537.7 / Nil / 6.54 / 11.82 / 4.13 / 3.76 / 8.20 / 8.90
Birla Sun Life G Sec Fund – LT / 917.6 / Nil / 9.82 / 22.43 / 2.42 / 2.65 / 7.29 / 8.53
Franklin India GSF – LTP / 396.9 / Nil / 9.07 / 20.45 / 2.78 / 2.84 / 7.44 / 7.66
ICICI Prudential Long Term Gilt Fund / 1511.6 / Nil / 9.68 / 22.94 / 2.56 / 2.88 / 6.82 / 7.79
HDFC Gilt Fund - L T P / 3027.4 / Nil / 9.24 / 20.74 / 3.54 / 3.27 / 7.63 / 8.16
SBI Magnum Gilt LTP / 2733.4 / Nil / 6.05 / 9.55 / 4.24 / 4.24 / 10.00 / 9.81
Recommendation: Invest in Lump sum mode with an investment horizon of over 1 year
Category (ii) (e) / Recommended Short Term Funds as of March 2016
Scheme / Corpus (INR Crs) / Exit Load / Mod Duration
(Years) / Returns
Avg Maturity (Years) / 6 Mth / 1
Year / 3
Years / 5
Years
SBI Corporate Bond Fund - Reg – Growth / 552.2 / <12 Month;3%,
24 Month;1.5%,
<36 Month;0.75% / 2.18 / 2.89 / 8.10 / 8.79 / 10.11 / 9.93
Kotak Medium Term Fund - Reg - Growth / 1146.5 / <18 Months;2% / 2.15 / 2.94 / 8.66 / 8.73 / -- / --
IDBI Debt Opportunities Fund - Growth / 176 / <18 Months2% / 0.88 / 1.05 / 7.25 / 8.21 / -- / --
HDFC Corporate Debt Opportunities Fund - Reg - Growth / 6029.1 / <12 Months;2%,
<24 Months;1% , <36 Months;0.5% / 2.31 / 3.17 / 8.53 / 8.16 / -- / --
Reliance RSF - Debt - Growth / 5202.5 / <1 Year1% / 1.66 / 2.26 / 8.00 / 8.28 / 9.15 / 9.22
Birla Sun Life Medium Term Plan - Reg - Growth / 5059.6 / <365 Days; 2%,
<730 Days; 1% / 4.02 / 5.95 / 8.04 / 8.64 / 10.45 / 10.40
Franklin India Corporate Bond Opportunities Fund - Growth / 7851.3 / <12 Months;3%,
<24 Months; 2% ,
<36 Months ;1% , / 1.88 / 2.39 / 5.51 / 7.01 / 9.28 / --
Recommendation: Regular investment in lumpsum mode with low duration with high coupon yields
Category (iii) (b) / Recommended Liquid Funds as ofMarch 2016
Scheme / Corpus
(INR Crs) / Exit Load / Mod Duration
(Years) / Avg Maturity (Days) / Returns
6 Mth / 1
Year / 3
Years / 5
Years
Reliance Liquid Fund - Cash Plan - Growth / 3246.3 / Nil / 0.11 / 0.12 / 6.92 / 7.42 / 8.13 / 8.50
HDFC Cash Mgmt Fund - Savings Plan - Growth / 8304.4 / Nil / 0.07 / 0.08 / 7.53 / 8.08 / 8.79 / 9.00
UTI Money Market - IP - Growth / 11615.1 / Nil / -- / 0.10 / 7.68 / 8.18 / 8.82 / 9.03
Birla Sun Life Cash Plus - Reg - Growth / 22475.9 / Nil / 0.08 / 0.08 / 7.65 / 8.21 / 8.90 / 9.09
SBI Premier Liquid Fund - Reg - Growth / 25686.9 / Nil / 0.09 / 0.10 / 7.61 / 8.11 / 8.79 / 9.00
DSP Blackrock Liquidity Fund - IP - Growth / 6639.7 / Nil / 0.08 / 0.09 / 7.60 / 8.11 / 8.79 / 9.00
Franklin India TMA - Super IP - Growth / 3053.6 / Nil / 0.09 / 0.09 / 7.92 / 8.35 / 8.99 / 9.16
Recommendation: Utilise Liquid funds to park monthly accruals and maintain liquidity in portfolio
Category (iv) (b) / Recommended Diversified Equity Funds as of March 2016
Schemes / Launch Date / Corpus* (in Crs) / Exit Load / Returns
1
Yr / 2
Yrs / 3
Yrs / 5
Yrs
Large Cap Funds
SBI Magnum BlueChip Fund-G / 14-Feb-06 / 3872.6 / <1 Year,1% / -5.98 / 20.47 / 17.10 / 14.28
Kotak 50 - G / 15-May-12 / 279.85 / <1 Year,1% / -10.19 / 15.44 / 12.56 / 10.04
Birla Sun Life Top 100 Fund - Growth / 24-Oct-05 / 1760 / <365;1% / -9.92 / 16.35 / 15.83 / 12.70
Reliance Focused Large Cap Fund - G / 28-Mar-06 / 984.1 / <1 Year,1% / -13.78 / 11.00 / 12.23 / 9.23
Reliance Top 200 Fund - G / 08-Aug-07 / 1939.5 / <1 Year,1% / -14.60 / 16.65 / 14.39 / 11.17
IDBI India Top 100 Equity Fund - G / 15-May-12 / 294.1 / <1 Year,1% / -12.47 / 15.68 / 14.49 / --
Birla Sun Life Frontline Equity Fund - Reg - Growth / 30-Aug-02 / 10154.4 / <365;1% / -9.78 / 16.22 / 15.04 / 12.11
ICICI Prudential Focused Bluechip Equity Fund - Retail - G / 23-May-08 / 9537.8 / <1 Year,1% / -11.87 / 12.65 / 12.83 / 10.69
Franklin India Bluechip-G / 01-Dec-93 / 6491 / <1 Year,1% / -7.37 / 14.44 / 11.77 / 9.61
Mid Cap Funds
SBI Magnum Mid Cap Fund - G / 29-Mar-05 / 1258.02 / <1 Year,1% / -2.63 / 29.45 / 29.50 / 21.59
Sundaram Select Midcap - G / 30-Mar-07 / 3291.91 / <12 Months;1% / -7.13 / 31.61 / 25.07 / 17.44
UTI Mid Cap Fund - G / 03-Oct-02 / 3424.64 / <1 Year,1% / -7.78 / 31.95 / 30.15 / 20.08
DSP Blackrock Small and Mid Cap - G / 30-Jul-02 / 1905.41 / <12 Months;1% / -9.58 / 26.87 / 22.36 / 15.40
Reliance Mid & Small Cap fund -G / 09-Apr-04 / 1926.88 / <1 Year,1% / -4.57 / 38.25 / 33.88 / 20.62
HDFC Mid-Cap Opportunities Fund - G / 16-Sep-10 / 10762.5 / <1 Year,1% / -8.06 / 26.33 / 24.51 / 19.33
Franklin India Prima-G / 28-Oct-04 / 3907.09 / <1 Year,1% / -8.00 / 29.80 / 25.24 / 19.56
Canara Robeco Emerging Equities - G / 14-Nov-06 / 911.174 / <18 Months;1% / -8.24 / 36.17 / 28.56 / 20.79
Multi Cap Funds
SBI Magnum Global Fund 94 - Growth / 30-Sep-94 / 2473.9 / <12 Months;1% / -9.57 / 26.47 / 22.60 / 19.12
ICICI Prudential Value Discovery Fund - G / 16-Aug-04 / 11064.7 / <12 Months;1% / -10.76 / 26.90 / 22.97 / 17.68
Franklin India Prima Plus - Growth / 29-Sep-94 / 6337.11 / <1 Year;1% / -6.38 / 22.59 / 18.79 / 14.36
Reliance Equity Opportunities Fund - G / 31-Mar-05 / 11651.1 / <1 Year;1% / -16.81 / 16.20 / 14.44 / 13.84
Reliance RSF - Equity - Growth / 08-Jun-05 / 2822.93 / <1 Year;1% / -12.71 / 18.65 / 14.16 / 10.15
UTI Equity Fund - Growth / 20-Apr-92 / 4721.56 / <1 Year;1% / -10.45 / 16.02 / 14.91 / 12.18
Axis Equity Fund - Growth / 05-Jan-10 / 1971.28 / <12 Months;1% / -10.82 / 12.75 / 12.74 / 10.93
HDFC Capital Builder Fund - Growth / 01-Feb-94 / 1034.64 / <1 Year;1% / -9.73 / 16.63 / 16.34 / 11.84
ICICI Prudential Dynamic Plan - G / 31-Oct-02 / 5546.54 / <1 Year;1% / -11.77 / 10.65 / 13.33 / 10.17
Reliance Growth - Growth / 08-Oct-95 / 5473.6 / <1 Year;1% / -12.86 / 20.35 / 15.30 / 10.22
Birla Sun Life Equity Fund - Growth / 27-Aug-98 / 2480.62 / <365 Days;1% / -9.64 / 20.63 / 18.60 / 12.51
Tata Equity Opportunities Fund - Reg - G / 25-Feb-93 / 1129.91 / <365 Days;1% / -10.34 / 18.32 / 16.55 / 12.91
Recommendation: Invest in SIP mode with an investment horizon of over 3 years. SIP limits the impact of market volatility by investing at every level in a systematic manner.
Category (iv) (c) / Recommended ETF & Index Funds as of March 2016
Index Fund / Launch Date / Exit Load / Corpus* (in Crs) / Returns
1 Yr / 2 Yrs / 3 Yrs / 5 Yrs
IDBI Nifty Index Fund - Growth / 25-Jun-10 / Nil / 121.6 / -14.32 / 6.88 / 7.91 / 6.19
Franklin India Index Fund Nifty - G / 28-Sep-10 / <30 Days;1% / 67.71 / -13.53 / 7.58 / 8.4 / 6.52
ICICI Prudential Nifty Index Fund - Reg - G / 26-Mar-04 / Nil / 164.1 / -13.53 / 8.05 / 9.04 / 6.96
SBI Nifty Index Fund - Regular Plan - G / 17-Jan-02 / <7 Days;1% / 204.5 / -13.9 / 6.97 / 7.75 / 6.2
Birla Sun Life Index Fund - Growth / 18-Sep-02 / Nil / 427.6 / -13.96 / 7.37 / 8.4 / 6.15
HDFC Index Nifty Fund -G / 17-Jul-02 / <3 Months;1% / 147.631 / -13.14 / 8.24 / 9.04 / 6.79
Exchange Traded Funds
CPSE ETF / 28-Mar-14 / Nil / 1956 / -21.12 / -- / -- / --
GS Nifty BeES / 28-Dec-01 / Nil / 807.8 / -13.23 / 8.34 / 9.26 / 7.48
Recommendation: Invest in SIP mode with an investment horizon of over 3 years. SIP limits the impact of market volatility by investing at every level in a systematic manner.

Hope you will find our advice in order and help you in optimizing returns with Mutual funds. For any further information we request you to call upon the undersigned:

Sincerely,

For SPA Capital Advisors Ltd.

Sd-

Mr. Rahul Chandalia

Senior Manager (Research)

EUIN – E146916

099104 93859; 011-4567 5536

Disclaimer: - The information contained in this report is obtained from reliable sources. In no circumstances should it be considered as an offer to sell/buy or, a solicitation of any offer to, buy or sell the securities or commodities mentioned in this report. No representation is made that the transactions undertaken based on the information contained in the report will be profitable, or that they will not result in losses. SPA and/or its representatives will not be liable for the recipients’ investment decision based on this report.