The power of Aditya Birla Sun Life Multi-Cap Fund - NFO Opens: 19th April 2021 | NFO Closes: 3rd May 2021
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The power of
Aditya Birla Sun Life
Multi-Cap Fund
An open ended equity scheme investing
across large cap, mid cap & small cap stocks
NFO Opens: 19th April 2021 | NFO Closes: 3rd May 2021
Fund Positioning
Smallcap
Midcap
Return Potential
Multicap
Large &
Mid Cap
Flexicap
Largecap
Risk Probability
Multi Cap Fund is mandated to have at least 25% exposure each in Large,
Mid & Small Cap segments
Risk exposure is being measured by exposure to small and mid cap stocks
Aditya Birla Sun Life AMC Ltd.
Multi Cap Fund - A well spread platter
LARGE CAP (Top 100
Stocks) Opportunity & Mandate to
select from a broader range of
sectors and companies
MID CAP
(101st - 250th Stock)
SMALL CAP (251st to 500th Stock)
Aditya Birla Sun Life AMC Ltd.
Indian Economy is at the cusp of Growth
Recession to Recovery Govt. Reforms
Estimated GDP Growth in FY22 is ~12% Revive growth
Narrow Rally to
Broad-based
Benign Liquidity Fiscal Push
DM to EM, Largecap
Increase in FII & FDI flows to Mid & Smallcap, Multiplier effect on growth
Defensives to Cyclicals,
Growth to Value
Growth Momentum Low Real Interest Rate
Upgrades to economic growth estimates Favourable for capex spend
Source: ABSLAMC Research
4
Aditya Birla Sun Life AMC Ltd.
Mid & Small Cap segments Outperform during periods of Economic Growth!
Market Performance vis-à-vis Real GDP Growth
1400 GDP growth CAGR: 8.5% GDP growth CAGR: GDP growth CAGR: 7.2% 9.0%
9.4%
1200 8.0%
Absolute Returns
Absolute Returns Absolute Returns Mid Cap: 161% 7.0%
1000
Small Cap: 527% Small Cap: 145% Small Cap: 158% 6.0%
800 Mid Cap: 315% Mid Cap: 138% Large Cap: 86%
Large Cap: 243% Large Cap: 107% 5.0%
600
4.0%
400
3.0%
200 2.0%
0 1.0%
Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20 Jan-21
Nifty 50 TRI Nifty Midcap 100 TRI Nifty Smallcap 100 TRI Real GDP Growth (YoY %)
India’s real GDP growth for FY21/22 is estimated between 7.5-12.5%,
favourable for Mid & Small Cap Segment!
FY Real GDP growth number has been considered for calculation; Phase1: Jan-04 to Jan-08, Phase2: Jan-09 to Dec-10, Phase3: Jan-13 to Jan-18
Data as on 16th Feb 2021; Source: RBI, MFIE, Bloomberg, ABSLAMC Research, World Bank Projections
Aditya Birla Sun Life AMC Ltd.
Pockets of Opportunities in the Current Investment Cycle
Private Banks (Large Cap)
Structural story of increasing market share based on high
capitalization, better asset quality and healthy liability
franchise
Technology / Digital (Mid Cap) Shift from unorganized to organized
(Large & Mid Cap)
Factors driving higher tech spend:
a) Modernization of core infrastructure; Organized players continued to gain
b) Adoption of public and hybrid cloud market share amid COVID crisis and had
model; and c) increased adoption of AI earlier benefitted from reforms like
Demonetization, GST etc
Manufacturing in India (Mid & Small Cap)
Specialty Chemicals (Small Cap)
Many MNCs have been actively looking to diversify
supply chains and Govt. announced Production Linked Expected to benefit from govt’s push on
Incentives (PLI) favourable for domestic manufacturing import substitution, increasing domestic
demand and rising exports
Key investment opportunities are found in the mentioned Market cap
A case study for illustration purpose only. Not intended as advise. The sector(s)/stock(s)/issuer(s) mentioned in this presentation do not constitute any research report/recommendation
of the same and the Fund may or may not have any future position in these sector(s)/stock(s)/issuer(s).
Aditya Birla Sun Life AMC Ltd.
Private Banks - Stronger vaults to clock Faster Growth
Deposit market share trends –
Liquidity and capital* – Large Private banks are best placed
Pvt banks are gaining share consistently
100% 200% 189% 185% 20%
13% 17% 18% 21% 180% 161%
80% 29% 16%
160% 144%
0.9% 0.04 0.6% 1.8% 140% 135% 133% 125% 132% 12%
60% 122% 121%
120% 112% 111% 111%
101% 8%
40% 81% 78% 77% 75% 100%
66% 80% 4%
20%
FB
IDFC
ICICI
AUSFB
BOI
RBL
Kotak
Canara
BOB
Axis
IIB
PNB
SBI
HDFC
0%
F2000 F2005 F2010 F2015 F2020E PSU Banks Private Banks
Liquidity Coverage Ratio Common Equity Tier 1 Ratio (RHS)
PSU Banks Private Banks Annualized market share gain at Pvt banks (% points)
Loan book Market share of Pvt sector banks (incl SFB) • Private banks have grown at a faster pace, yet there’s
– expected to increase sharply
room for further growth
Sector Growth: 9%
- PSU 3% • Adequate capitalization and liquidity to provide support
- Pvt 16% for faster growth
Sector Growth: 16%
- PSU 14%
- Pvt 21% 52%
Private banks can witness last 15 years
38% of growth in next 5 years
19%
Mar-05 Mar-20 Mar-25
*Data as on FY20; Source: RBI, Companies, ABSLAMC Research
Aditya Birla Sun Life AMC Ltd.
Big getting Bigger - Organized sector placed to gain Market Share
Demonetization (2016) & GST (2017) had initiated the 1st wave of consolidation in favor of organized sector
AC Industry Retailing Home Care
COVID crisis has triggered 2nd wave of consolidation in favour of organized players!
Key drivers of growth: a) Ability to digitize distribution, b) Increasing direct reach, c) Better management of working capital, d) Access to institutional funding
98% 93% 92%
75% 75%
High share of unorganized 60% 60%
50% 50%
40% 40%
players across industries 25% 25%
indicates ample scope for 2% 7% 8%
continued consolidation
Grocery Retail Apparel Real Estate Jewellery Plywood FMCG Plastic Pipes Homeware
Unorganized Organized
*Data as on Aug-20, Source: BOFA, ABSLAMC Research
Aditya Birla Sun Life AMC Ltd.Make in India - Mid & Small cap companies to become more “Atmanirbhar”
Domestic Market Size
Sector Name Theme Growth Drivers
(approx.)
Large domestic consumer base, PLI scheme in multiple segments,
Electronics* Import substitution, PLI USD 120bn Export opportunities
Labour reforms, competitive cost environment, Chinese mfg.
Textiles and apparels** Exports, PLI USD 100bn slowing
Increased government spends in infrastructure, PLI scheme in
Engineering goods^ Exports, Import substitution, PLI USD 92bn multiple industries to drive investments
Increasing auto penetration (cars, 2Ws), increasing sale of
Automobiles & Exports, Import substitution, premium products (both 2W and Cars), local sourcing of
USD 80bn components (import substitution) and higher exports of
Ancillaries^^ premiumisation, PLI
components and vehicles from India
Complex generics, favourable regulatory landscape & govt.
Pharmaceuticals*^ Exports, Import substitution, PLI USD 20bn incentives, vertical integration & cost leadership
Manufacturing push could stimulate growth in many industries!
Data as on: *FY19, **Latest, ^CY19, ^^ Based on FY20 & FY21 estimates, *^FY20
Source: JM Financial Research, ABSLAMC Research
Aditya Birla Sun Life AMC Ltd.Specialty Chemicals - Catalyst for Higher Growth
Market share – India accounts for only 3%, room for growth Specialty chemicals is an integral part of value chain
40 36% of multiple sectors like pharma, textiles, paints, auto,
2008 2018
30 27% agriculture etc.
22%
17% 18%
20 16%
10%11%
Sector Growth Drivers
10 7% 5%
3% 4% 2% 3% • Increasing domestic demand
0 • Import Substitution and export opportunity
EU NAFTA Japan S.Korea India Rest of China
Asia
• Manufacturing shift from China - Opportunity for India to
create foothold in global supply chain
Region wise expected growth of
specialty chemicals sector over FY18-23 Factors in favour of India
15 13%
• Availability of skilled and low-cost manpower
10 • Availability of required infrastructure and raw materials
7%
5% • Relatively liberal regulations for high polluting companies
5 3% • Increasing capex and R&D spend
2% 1%
0
China North Western Japan India Global
America Europe
Indian Specialty Chemicals sector is expected to replicate
the decadal growth seen in IT in 90s & Pharma in 2000s
Source: AMBIT Capital
Aditya Birla Sun Life AMC Ltd.A Glimpse of Digital Disruption in India
Digital Disruptions
India in comparison to US and China
100.0% 90.1% 86.5%
84.1%
E-Commerce FinTech 80.0%
78.0%
72.0%
Amazon, Flipkart, Snapdeal, Myntra Paytm, Phonepe, PayU, Lending Kart 61.7% 65.1%
60.0%
42.7%
40.0% 26.7% 32.0%
22.3%
20.0%
3.2%
0.0%
FoodTech & Ride Hailing Digital Entertainment E-com Shopper Internet Smartphone
Swiggy, Zomato, Uber, OLA Netflix, Prime Video, Saavn, Gaana penetration penetration penetration penetration
India China USA
Traditional companies are transforming into
enablers for Digital India Inc.
Ed-Tech Med-Tech
Byju's, Unacademy, Vedantu, Toppr Medlife, Netmeds, PharmEasy, 1mg
Source: AMBIT Capital
Aditya Birla Sun Life AMC Ltd.Digital wave is Prominent & Fast growing
Disruptors
Enablers
Source: Company Websites
Disclaimer: All third party trademarks (including logos and icons) remain the property of their respective owners. Use of it does not imply any affiliation with or endorsement by them.
12
Aditya Birla Sun Life AMC Ltd.How can an
Investor seize
these investing
opportunities?
13
Aditya Birla Sun Life AMC Ltd. For Private Circulation OnlyPresenting A well curated portfolio for all your investment needs ! Aditya Birla Sun Life Multi-Cap Fund (An open ended equity scheme investing across large cap, mid cap & small cap stocks)
Positioning & Approach
Fund Positioning ➢ An open ended equity scheme investing across large cap, mid cap & small cap stocks in a disciplined manner
➢ Portfolio will be Sector and Benchmark Agnostic
Focused Strategy Bottom-Up Approach Growth Oriented Portfolio
Investment
Approach
A combination of Focused Large Cap, Bottom-up approach of stock Portfolio will be biased towards
Focused Mid Cap & Focused Small selection to build well curated secular growth opportunities from
Cap in one portfolio portfolio of high conviction ideas across the market spectrum
The fund is suitable for Long term Equity Investors with High risk appetite with an Investment horizon of 5 years
Suitability and above
The Scheme does not guarantee/indicate any returns. There can be no assurance that the schemes’ objectives will be achieved.
Aditya Birla Sun Life AMC Ltd.Investment Philosophy
The scheme will invest 25-45% in Large Cap and 25-35% each in Mid and Small Cap
segments
The scheme will follow a bottom-up approach of stock selection
Stock selection will be based on:
Management Quality & Size of the Competitive Sustainable Margin of
Corporate Governance Opportunity Advantage Growth Potential Safety
A portion of the scheme may opportunistically be invested in special opportunities, emerging
sectors and businesses
Aditya Birla Sun Life AMC Ltd.Portfolio Construction Process
ABSLMF Investment Universe
(400+ companies)
Large Cap Mid Cap Small Cap
(15-20 Companies) (15-20 Companies) (15-20 Companies)
Resultant Portfolio
(50-60 companies)
Resultant
Portfolio
Follows a diligent process to select 50-60 (50-60 from universe of ~400 companies
companies
companies)
Best of all the Market Cap
Aditya Birla Sun Life AMC Ltd.Tenets of Portfolio Construction Process
Invest in Avoid Resultant Portfolio
• Dominant business with wide • Weak corporate governance
moat practices
• Having strong management & • Fundamentally weak companies High quality companies with
corporate governance • Overleveraged businesses sustainable long term growth
• Sound balance sheet with low • Overvalued companies potential
leverage • Companies having higher
• Sustainable high growth pledge
potential
• Consistent cashflows and
improving return ratios
Bottom-up approach helps build credible portfolio
with enhanced return potential
Aditya Birla Sun Life AMC Ltd.Why invest in Aditya Birla Sun Life Multi-Cap Fund?
Combines stability of large caps and the high growth potential of mid & Best of all
small caps in one portfolio Disciplined the
Rebalancing Market
Cap
Disciplined market cap allocation and active rebalancing provides opportunity to
invest in fast growing sectors / companies from across the spectrum Well
Curated
Portfolio
Bottom – up approach helps build portfolio of high conviction ideas to enhance
return potential
Potential for Higher Returns
Ideal portfolio to play high growth cycle
Aditya Birla Sun Life AMC Ltd.Case Studies: Exclusivity & Growth Potential of Quality Compounders
10Y
Company Name Rationale
CAGR
• One of the largest players in consumer finance and a pioneer in introducing interest free EMI finance options in more than 50
categories ranging from consumer durables, lifestyle products to groceries in India
Bajaj Finance 58%
• Over the years, Bajaj has built a well diversified lending portfolio across retails, SME and commercial customers segments with
robust balance sheet and lowest NPA with strong presence across the country
• Deepak Nitrite is one of fastest growing chemical intermediates companies growing on the back of import substitution and would
be a one of the key beneficiary of the prevailing “China+1” sourcing requirements
Deepak Nitrite 51%
• Key strengths: high degree of backward integration and diversified product portfolio
• Witnessing margin improvement with cost control, debottlenecking of existing capacity and improving product mix
• Atul Ltd. with a rich history of over 7 decades has best-in-class growth and return ratios and high cash generation among
comparable Indian chemical companies
Atul Ltd. 45% • Atul has expanded its addressable market by entering downstream products and acquiring capabilities through MNC partnerships
and improved internal efficiencies over the past decade
• Atul is well-positioned to benefit from sector tailwinds of import substitution and exports opportunities
• Honeywell Automation has a wide product portfolio in environmental and combustion controls and provides engineering services in
Honeywell the field of automation and control to global clients.
35%
Automation • Honeywell would continue to benefit from increasing adoption of automation technologies such as AI, IOT, Cloud and Industrial
Software across India and would be a key beneficiary of improving manufacturing outlook for the country.
Data as on 16th Feb 2021; Source: Bloomberg
Case studies for illustration purpose only. Not intended as advise. The sector(s)/stock(s)/issuer(s) mentioned in this presentation do not constitute any research report/recommendation
of the same and the Fund may or may not have any future position in these sector(s)/stock(s)/issuer(s). All third party trademarks (including logos and icons) remain the property of their
respective owners. Use of it does not imply any affiliation with or endorsement by them.
Aditya Birla Sun Life AMC Ltd.Case Studies: Exclusivity & Growth Potential of Quality Compounders
10Y Rationale
Company Name
CAGR
• Major player in white cement industry with a strong brand recall
J.K Cement • Strategically used cashflows of white cement business to grow grey cement capacity while minimizing the debt
34%
• Increased capacity by 3x in last 10 years from 5 mnt to 15 mnt. Capacity addition in most attractive regions has resulted in higher than
industry volume and earnings growth
• The most trusted food brand with household names like Good Day, Tiger, NutriChoice, Milk Bikis and Marie Gold
Britannia • With change in management in 2013, company witnessed sharp growth in revenue and significant improvement in profitability which has
Industries 34% led to significant rerating of the company
• Britannia is transforming itself from biscuits company to total foods company with sharp focus on premiumization and improving reach
across India
Cholamandalam • It has grown to become 10th largest NBFC in India offering vehicle finance, home loans, home equity loans and SME loans with deep
Investment & Finance expertise in underwriting for less-banked segments
33%
• Chola has more than 80% of its branches in tier 2 and beyond and Chola derives its strength from its long history of financing First Time
Borrowers and New to Credit customers in these markets.
• It has deep domain experience in Insurance, Travel and Hospitality sectors. Client relationships in these sectors are over 10 years and
company is one of the top integration and digital partner of choice for its customers.
Coforge Ltd. 30% • Over the last few years, post change in top management, it has been able to improve on growth and margins materially.
• Growth drivers: a) healthy order book backed by consistent large deal wins; b) Partnerships with large players in cloud like Microsoft Azure,
Google cloud, AWS and partnering with product start-ups to drive new age technology growth
Data as on 16th Feb 2021; Source: Bloomberg
Case studies for illustration purpose only. Not intended as advise. The sector(s)/stock(s)/issuer(s) mentioned in this presentation do not constitute any research report/recommendation of
the same and the Fund may or may not have any future position in these sector(s)/stock(s)/issuer(s). All third party trademarks (including logos and icons) remain the property of their
respective owners. Use of it does not imply any affiliation with or endorsement by them.
Aditya Birla Sun Life AMC Ltd.Who should invest?
Investors looking for one stop Risk aware equity investors with Apt investment vehicle for SIP
solution of aggressive equity fund an investment horizon of 5 years investments to achieve market
for long term and above cap based diversified allocation
Aditya Birla Sun Life AMC Ltd.Fund Features & Asset Allocation
Scheme Name Aditya Birla Sun Life Multi-Cap Fund
Fund Manager Mahesh Patil and Dhaval Shah for Equity securities, Harshil Suvarnkar for Debt securities, Vinod Bhat for Overseas Investments
Scheme Type An open ended equity scheme investing across large cap, mid cap & small cap stocks
The objective of the scheme is to achieve long term growth of capital, at commensurate levels of risk through a diversified research based
investment in Large, Mid & Small cap companies.
Investment Objective
The Scheme does not guarantee/indicate any returns. There can be no assurance that the schemes’ objectives will be achieved.
Scheme Benchmark Nifty 500 Multicap 50:25:25 TRI
Equity & Equity related instruments across large, mid and small cap companies*: 80% - 100%.
Debt and Money Market Instruments: 0-20%.
Asset Allocation
*The Scheme will invest a minimum of 25% of total assets each in Large, Mid and Small Cap stocks
Regular Plan and Direct Plan; Each of the above (Regular and Direct) Plans under the scheme will have the following Options: Payout of Income
Plans & Options
Distribution cum Capital Withdrawal Option, Growth Option
Entry Load : NIL; | Exit Load : For redemption / switch-out of units within 365 days from the date of allotment: 1.00% of applicable NAV.
Entry & Exit Load
For redemption / switch-out of units after 365 days from the date of allotment: Nil
NFO Open Date 19th April 2021
NFO Close Date 3rd May 2021
Note: For details, refer SID/KIM of the scheme.
Aditya Birla Sun Life AMC Ltd.Risk Factors & Suitability
This product is suitable for investors who are seeking*:
• Long term capital growth and income
• Investment predominantly in equity and equity related instruments as
well as debt and money market instruments
*Investors should consult their financial advisors if in doubt about whether the product is suitable for them
Aditya Birla Sun Life AMC Ltd.Thanks Aditya Birla Sun Life AMC Ltd.
Disclaimer
This document is solely for the information and understanding of intended recipients only. If you are not the intended recipient, you are
hereby notified that any use, distribution, reproduction or any action taken or omitted to be taken in reliance upon the same is prohibited and
may be unlawful. Wherever possible, all the figures and data given are dated, and the same may or may not be relevant at a future date. In the
preparation of the material contained, Aditya Birla Sun Life AMC Limited (“ABSLAMC”) has used information that is publicly available including
information developed in-house. Information gathered and material used in this document is believed to be from reliable sources. ABSLAMC
however does not warrant the accuracy, reasonableness and / or completeness of any information. Further the opinions expressed and facts
referred to in this document are subject to change without notice and ABSLAMC is under no obligation to update the same. While utmost care
has been exercised, ABSLAMC or any of its officers, employees, personnel, directors make no representation or warranty, express or implied, as
to the accuracy, completeness or reliability of the content and hereby disclaim any liability with regard to the same. Recipients of this material
should exercise due care and read the scheme information document (including if necessary, obtaining the advice of
tax/legal/accounting/financial/other professional(s) prior to taking of any decision, acting or omitting to act. Further, the recipient shall not
copy/circulate/reproduce/quote contents of this document, in part or in whole, or in any other manner whatsoever without prior and explicit
approval of ABSLAMC. The sector(s)/stock(s)/issuer(s) mentioned in this presentation do not constitute any research report/recommendation
of the same and the Fund may or may not have any future position in these sector(s)/stock(s)/issuer(s).
For internal & private circulation only
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.
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