April 2011 A Monthly Wealth Journal

ASSOCIATION
The Path To Wealth WEALTH MANAGEMENT
FOR LIFE
 Contents
The Road Ahead 1
Wealth Overview 2
Market Round Up -Equity 3
Model Portfolios 4
Sector of the month 6
Stock pick of the month 7
Technical Market Outlook 8
The Road Ahead
Derivative Market Outlook 9
The FY 2011 was a remarkable year for the Indian economy as it emerged out
Mutual Fund round up 10 rapidly from the slowdown caused by the financial crisis. The GDP growth for
Insurance 11 the year is expected to be 8.6% and is projected to be 9% for FY12. However,
Bond Market Outlook 12 various economic factors like inflation and global economic developments
Currency Market Outlook 12 have been presenting a challenging business environment to the Indian
companies.
Real Estate Opportunities 13-14
Commodity round up A strong consumption led growth has put an upward pressure in the
15
commodity prices. The RBI, in response, has been following a policy of
Alternative Investment Ideas 16 monetary tightening and has further hiked the repo and reverse repo by 25 bps
in March to keep inflation under control. The tight monetary situation is,
however, is expected to hurt the growth of the Indian companies. This is
Editor Vijay Agrawal evident in the low IIP numbers for the past few months. The IIP growth has
Assistant Editor Yatish Pandey been slowing down largely led by a weakness in capital goods sector. The
current account deficit situation on the other hand has been improving due to
Printed and Published on behalf of increase in exports led by a global economic recovery. For the period April to
Vijay Agrawal Feb in FY 11, exports went up by 31.4% while imports grew by 18%.
Unicon Wealth Management
285, Princess street, Jhawar House, Ground Floor, The capital markets have been pretty volatile throughout the year. Sustained
Marine lines, Mumbai- 400002 economic recovery boosted the investor sentiments in the first half of the year
vagrawal1@uniconindia.in and FIIs pumped in huge money in the Indian capital markets till Oct 2010.
However, the investor sentiments turned negative towards the second half of
Design & Print the year due to continuing inflation worries, high interest rate environment,
Kozmic Style Offset
corruption cases and protests in middle east and north Africa region. The
D 137, Okhla Industrial Area, Phase- 1,
New Delhi - 110020 tragic earthquake in Japan on 11th March further dampened the investor
Ph.: +91 11 46251190, Email: kozmic@consigliori.org sentiments due to its impact on the global supply chain and the expected
increase in global commodity prices.
Wealth Management While the demand is strong, the rising raw material costs are putting pressure
Unicon Financial Intermediaries. Pvt. Ltd. on the margin for the corporates. The rising interest rate environment is also
increasing the cost of debt which is having a negative impact on their capital
Head Office: investments and can impact growth going ahead.
P-45/90, Connaught Place
New Delhi- 110001, India. Despite the challenges, the FIIs put in nearly $1.3 billion I March in Indian
Tel: 011 -43529500 equities after selling a $2.2 billion in Jan and Feb due to attractive valuations
Fax: 011 -43581216 and increased confidence. We believe the confidence would continue to grow
and the capital markets would give attractive returns in the new financial year.
Corporate Office:
Block No. 2, Jhawar House, Best wishes for the new financial year 2012 to all.
285 Princess Street, Marine Lines (East),
Mumbai – 400 002, India.
Tel: 022 -43591200 Regards,
Fax: 022 -66181100
Gajendra Nagpal
SMS “UNICON” TO 54646 - TOLL FREE: 1800 10333 88 Founder & CEO
Unicon Financial Intermediaries Pvt. Ltd.
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 Wealth Overview

NOW is the time to plan for the year

It's been a truly roller coaster ride in the month of March for the Indian investors. On the one hand we passed through the biggest natural calamity in
Japan threatening to derail the growth of the all the Asian economies and on the other hand we have been facing the continuous disturbance from the
oil producing economies. Amid all this concerns, the SENSEX still managed to rise by almost 1600+ points backed by huge FII buying.
Going forward, equity markets in India are likely to stabilize and will remain range bound for next 1-2 months. The reason being the market would be
digesting Q-4 & full year results & making up its mind for the future course of action. Fortunately the FII have again turned positive on the Indian
markets & likely to remain so over a period of time. Markets are likely to reach new highs during the course of the year. BSE Index may reach around
24000 by the end of 2011-12. But we would have to ensure that we review & rebalance our portfolio at the end of each quarter.
One more fact I would like to share is that during the course of review meetings we have come to know that some of us are yet to submit our tax
returns till now. One of the key observations has been that at the end of the year, we just end up paying the tax & file the returns somehow before the
due date but we don't do tax planning at the beginning of the year itself. If we do that religiously, I am sure, we can save a lot of tax & save you from
running pillar to post at the end of the year.
Planning early at the beginning of the year has its own advantages. Not only it gives you enough time to evaluate the various alternatives available also
it allows us to execute our investment plan appropriately commensurate to your cash flows throughout the year.
So I would suggest you to initiate the preparation of your financial plan right at the beginning of the current month & complete the exercise by the
end of the month so as to reach your planned goals smoothly. You may follow the steps as suggested below
?Sit with your financial advisor with the requisite details
?Assess your Risk appetite
?Set realistic goals involving your family members.
?Include both short- and long-term requirements
?Prepare a proper financial plan & asset allocation plan
?Support the plan with a practical, working budget
?Execute the investment plan in consultation with your wealth advisor
Once your plan is ready, don't forget to review the plan on a periodic basis. Keep in mind that your asset allocation strategy should suitable to your
risk-return profile to get the most out of all asset classes. It has to be a balanced & optimum mix of Gold/Silver, equity, debt & real estates. In
fact those who are not comfortable having direct access to real estate properties either due to size or location, I would suggest to have a little bit of
exposure through “Real Estate PE/MF products. For example, one such product has been introduced recently by JM Financial group recently to
provide indirect exposure to the investors with an investment of `10 lacs only. In short a balanced asset allocation goes a long way in generating a
superior risk adjusted total returns.

Happy Investing
Rajev B Sharma
Country Head – Wealth Management & Investment Banking
Unicon Financial Intermediaries Pvt. Ltd

2
 Market Round Up -Equity
Domestic Markets Sectoral Indices Performance
?
Among the BSE sectoral indices, Realty (+17.93%), Auto
Index Feb-11 March-11 Change Change % High Low
(+12.58%), Bankex (+12.33%), CD (+10.80%), Oil&Gas
Sensex 17,823.40 19,445.22 1,621.82 9.10% 19,575.16 17,792.17
(+8.26%), Teck (+7.93%) ended positive.
Nifty 5,333.25 5833.75 500.50 9.38% 5,872.00 5,348.20
?
Among other indices, BSE MidCap (+7.85%), SmallCap
Global Markets (+4.59%), BSE100 (+9.03%) ended negative.

Index Feb-11 March-11 Change Change% High Low Sectoral Indices

Dow Jones 12,226.34 12,319.73 93.39 0.76% 12,422.96 11,548.14
Nasdaq 2,782.27 2,781.07 -1.2 -0.04% 2,802.32 2,603.50
S&P 500 1,327.22 1,325.83 -1.39 -0.10% 1,332.28 1,249.05
Nikkei 10,624.09 9,755.10 -868.99 -8.18% 10,768.43 8,227.63
CAC 4,110.35 3,989.18 -121.17 -2.95% 4,145.73 3,693.94
FTSE 5,994.00 5,908.80 -85.2 -1.42% 6,052.10 5,591.60
Hangseng 23,338.02 23527.52 189.5 0.81% 23,934.07 22,123.26

Nifty Index PCR

1.4

1.2

0.8

Market News
PCR

0.6

0.4

0.2 FIIs were net buyers of `8395..9 cr (In Feb net sellers 7423
?
0
cr). DIIs were net buyers of `57.71 cr (In Feb net buyers of
1-Mar-11
3-Mar-11

4-Mar-11
7-Mar-11
8-Mar-11

9-Mar-11
10-Mar-11

11-Mar-11
14-Mar-11

15-Mar-11

16-Mar-11
17-Mar-11

18-Mar-11
21-Mar-11

22-Mar-11
23-Mar-11

24-Mar-11
25-Mar-11
28-Mar-11

29-Mar-11
30-Mar-11

31-Mar-11

`5781 cr) in cash market.

?
IPOs open in Mar 2011: Lovable Lingeries Ltd, PTC India
Turnover Feb-11 March-11 March-10 MoM
(` crs.) Change% Financial Services Ltd., Shilpi Cable Technologies Ltd.
Index Futures 402,759 399595 268266 -0.79% ?
IPOs listed in Mar 2011: Acropetal Technologies Ltd., Sudar
Stock Futures 401,306 363404 405316 -9.44% Garments Ltd., Fineotex Chemical Ltd., Lovable Lingeries
Index Options 2,044,353 2048597 843166 0.21%
Ltd., PTC India Financial Services Ltd.
?
India's exports continued to be on the uptrend and grew by
Stock Options 80,875 66302 51398 -18.02%
32.4 per cent to touch $ 20.605 billion in January 2011 from $
Total 2,929,294 2877900 1568147 -1.75% 15.557 billion in the same month of 2010. In rupee terms, the
exports in January 2011 were valued at `93,534 crore, which
Highlights was 30.8 per cent higher than the level of `71,500 crore
?
Major global indices traded rangebound with negative bias. achieved during January 2010.
?
In the US markets, Dow (+0.76%) ended positive, while
Nasdaq (-0.04%), S&P500 (-0.10%) ended marginal negative. ?
State-run Oil & Natural Gas Corporation (ONGC) plans to
?
In the Asian Markets, Nikkei (-8.18%) ended negative, while invest over 17,000 crore on onshore operations in Gujarat
Hangseng (+0.81%) ended marginal positive. over the next five years.
?
In the European markets CAC (-2.95%), FTSE (-1.42%) ?
GMR Infrastructure Ltd is likely to see three private equity
ended negative on weak global cues.
firms invest close to `1,500 crore in its unit GMR Airport
?
On the domestic front, Nifty gained 500.50 points (+9.38%)
and Sensex gained 1621.82 points (+9.10%) in the month. Holdings, which runs the Delhi and Hyderabad airports.
NSE Cash Turnover: `255,711 cr, down 4.05% as compared
? ?
Kotak Mahindra Group is seeking to raise private-equity
to previous month (`266,503 cr). funds of about $300 million from local and international
Total Derivative Turnover: `2,877,900 cr, down 1.75%, as
? investors to invest in infrastructure projects in the world's
compared to previous month (`2,929,294 cr). second-fastest growing major economy.
?
Turnover in index futures decreased 0.79% over the previous
?
Industrial output for January grew at a lower rate of 3.7%.
month.

3
 Model Portfolios
After a difficult February, the month of March has brought some Strategy
cheer to the markets. Post budget, especially with the escalating
situation in Libya and the Japanese Earthquake / Tsunami ?During the month, we have reduced our exposure to the high
threatening to slow-down its economy, the markets were trading in beta realty sector and increased it towards the Banking and
a narrow range. Post March 21, the markets have bounced back Agri Sector.
sharply and the Nifty has rallied to almost 5900 levels, a rally of ?Looking at the current market rally, we plan to further reduce
nearly 9%. Most of the growth has been led by short-covering in our exposure to the high beta sectors (infrastructure, metals)
beaten down sectors like Infrastructure and Realty, as well as this month and balance the portfolio with defensives.
expectations of positive earnings surprises by sectors like IT and
Capital Goods. The model portfolios however haven't caught up Stock movement
with this rally primarily due to a sharp decline in the initial part of
the month when markets were range-bound. However the ?
Stock Entered
portfolios are in good shape and can expect to outperform the Union Bank, Yes Bank, United Phosphorus, Jain Irrigation
benchmark indices in the coming month. ?
Stock Exited
Indiabull Realestate (Sold All)
Growth Portfolio Banswara Syntex (Sold All)
Objective
ICICI Bank (Sold All)
High Capital appreciation with moderate capital safety.
Sr. Stock Name % Wtg Rec.Price Price 31st % return %return
MSP Steel (Reduced)
No March-2011 (Since Inception) March-2011

1 Union Bank 3.9% 326.75 347.45 6.3% 6.3%

2 Yes Bank 5.9% 270.50 307.90 13.8% 13.8% Optimizer Portfolio
3 Crompton Greaves 5.3% 177.35 272.95 53.9% 11.4%
4 Shree Cement 7.1% 1725.59 2076.55 20.3% 20.1% Objective
5 IVRCL Infra 4.9% 171.55 81.60 -52.4% 17.7%
6 HCC 3.0% 61.50 36.35 -40.9% 7.2% Moderate Capital appreciation with substantial capital safety.
7 UTV software 5.3% 465.40 573.85 23.3% 14.5% Skewed towards Growth, value and large caps.
8 Aurobindo Pharma 5.0% 192.10 195.90 2.0% 15.2%
9 Apollo Tyre 4.0% 58.80 69.55 18.3% 33.2% Sr. Stock Name % Wtg Rec.Price Price 31st % return %return
No March-2011 (Since Inception) March-2011
10 Tata Motor 5.8% 1113.00 1247.50 12.1% 15.3%
11 MSP Steel 3.8% 72.00 64.70 -10.1% 6.3% 1 Hero Honda 3.8% 1544.30 1586.55 2.7% 8.3%
12 GAIL 5.6% 356.25 465.00 30.5% 8.6% 2 Bank of Baroda 15.5% 425.65 963.15 126.3% 10.6%
13 Reliance Ind 5.5% 973.00 1047.80 7.7% 8.6%
3 ICICI Bank 3.0% 1205.00 1112.75 -7.7% 14.6%
14 Navbharat Venture 6.5% 397.80 252.30 -36.6% 10.1%
15 BGR Energy 5.3% 612.00 477.15 -22.0% 17.1% 4 Syndicate Bank 0.7% 156.00 121.95 -21.8% 6.8%
16 Deepak Fertliser 6.7% 162.00 158.70 -2.0% 6.4% 5 Larsen & Toubro 3.8% 1516.00 1653.25 9.1% 8.2%
17 United Phosphorus 4.0% 135.80 150.40 10.8% 10.8% 6 Crompton Greaves 3.8% 261.10 272.95 4.5% 11.4%
18 Jain Irrigation 4.1% 188.40 178.55 -5.2% -5.2% 7 Castrol India 10.0% 240.93 441.75 83.4% 13.0%
Cash 8.3%
Total 100.0% 17.0% 11.3% 8 Oil India 7.9% 1140.55 1312.85 15.1% 6.4%
9 Dabur India 7.8% 70.65 96.05 36.0% -4.0%
% Returns Growth Nifty Top 5 Sectors Wtg 10 TCS 12.1% 532.95 1182.50 121.9% 6.2%
Since inception 17.0% 27.0% Fertiliser & Chem 14.8% 11 Infosys Tech 3.5% 2615.10 3236.75 23.8% 7.8%
Power 11.8% 12 HCL Tech 4.6% 358.85 476.50 32.8% 7.8%
Performance - 10.0%
Oil and Gas 11.1% 13 Glaxosmith Pharma 7.1% 1454.40 2094.45 44.0% -5.5%
For month of Mar. 11.3% 9.4% Auto & Auto Ancillary 9.8% 14 Aurobindo Pharma 6.2% 191.76 195.90 2.2% 15.2%
Performance +1.9% Banking & Finance 9.8% 15 Bharti Airtel 3.0% 405.35 357.50 -11.8% 8.0%
Cash 7.2%
Performance Highlights Total 100.0% 46.1% 6.5%

?
The portfolio has underperformed the Nifty by 10% since % Returns Growth Nifty Top 5 Sectors Wtg
Since inception 46.1% 27.0% IT Software 20.2%
inception and outperformed by 1.9% in the month of March Performance + 19.1% Banking & Finance 19.2%
Pharmaceuticals 13.3%
2011. For month of Mar. 6.5% 9.4% Chemicals 10.0%
Performance -2.9% Oil and Gas 7.9%
?
Apollo Tyres, Shree Cement, IVRCL Infra, BGR Energy, Tata
Motors and Aurobindo Pharma were the top gaining stocks Performance Highlights
during the month all gaining more than 15%. ?
The Optimiser Portfolio has outperformed the Nifty index by
?
Jain Irrigation was the only stock on the losing side. nearly 19% since its inception.

4
 Model Portfolios
?
For the month of March, the portfolio marginally % Returns Growth Nifty Top 5 Sectors Wtg
Since inception 43.0% 27.0% FMCG 13.9%
underperformed the Nifty by 2.9%. Banking & Finance 11.3%
Performance + 16.0%
?
The market gained on the back of positive sentiments and FII Capital Goods 11.0%
For month of Jan 5.7% 9.4% Pharmaceuticals 10.2%
inflows. Performance -3.7% Chemicals 10.2%
?
ICICI Bank, Crompton Greaves, Castrol India and Aurobhindo
Pharma were the gainers, each gaining more than 10%.
Performance Highlights
Strategy ?
The portfolio has outperformed the Nifty Index by 16% since
?The stocks in our portfolio represent the best possible picks in inception but underperformed by 3.7% for the month.
their respective sectors and we continue to believe that there is
?
The under performance was due to higher cash component
further potential upside from its current levels.
?However, increasing global uncertainty regarding oil prices on one hand and under performance by Dabur India and
and Japan's possible economic slowdown are negative cues Glaxosmith Pharma.
that can create pressure on the markets in the near-term. We
will continue to monitor the crude oil situation and its Strategy
immediate impact on the portfolio and move to cash whenever ?
Post Japan crisis, not only US and European markets have
the need arises. We will also look at restructuring the portfolio
in according to market conditions. rallied but our market also out performed other markets,
?We will also continue to look out for value picks for the ahead of Q4FY11 result.
portfolio. ?
We expect, broad market rally which began from March 22,
2011 to correct in near term. This correction should be used
Stock movement as an investment opportunity. Q4FY11 results and
?
Stocks Entered management guidance for FY12 would provide the direction
No changes during the month to the market, going forward. Broader market indices are still
?
Stocks Exited
trading at attractive valuations. With beginning of twelfth five
No changes during the month
year plan, we expect Infrastructure stocks to perform well
followed by Banks and IT.

Defensive Portfolio Stock movement

Objective ?
Stocks Entered
Concentrating on stable large cap, blue-chip companies aimed at
clients with moderate to low risk appetite. BHEL (Increased 5%)
Sr. Stock Name % Wtg Rec.Price Price 31st % return %return ?
Stocks Exited
No March-2011 (Since Inception) March-2011
HDFC Ltd (Sold All)
1 Punjab National Bank 2.7% 678.45 1220.15 79.8% 15.7%
2 Bank of Baroda 7.7% 425.65 963.15 126.3% 10.6%
3 ICICI Bank 0.9% 950.00 1112.75 17.1% 14.6%
4 BHEL 8.8% 2082.96 2060.85 -1.1% 3.0%
5 Crompton Greaves 2.2% 261.10 272.95 4.5% 11.4%
6 Dabur India 2.1% 69.20 96.05 38.8% -4.0%
7 Godrej Cons. Product 7.6% 235.15 365.40 55.4% 1.5%
8 Gillette India 2.6% 1414.25 1767.35 25.0% 11.5%
9 Britannia Ind 1.6% 440.00 370.55 -15.8% 9.8%
10 Castrol India 10.2% 240.93 441.75 83.4% 13.0%
11 Larsen & Toubro 6.3% 1510.70 1653.25 9.4% 8.2%
12 Dr. Reddy's Lab 3.2% 765.45 1638.55 114.1% 5.9%
13 Glaxosmith Pharma 7.0% 1454.40 2094.45 44.0% -5.5%
14 NTPC 6.6% 205.55 193.00 -6.1% 13.5%
15 Oil India 8.1% 1140.55 1312.85 15.1% 6.4%
16 Petronet LNG 1.7% 114.70 121.35 5.8% 10.3%
Cash 20.7%
Total 100.0% 43.0% 5.7%

5
 Sector of the month- Information Technology
Industry Background:
India has been the front-runner in the global IT outsourcing business for nearly a decade. The Information Technology (IT) sector accounts
for a significant section of India's services industry. More than 2.5 million people are employed in this sector either directly or indirectly,
making it one of the biggest job creators in India. Favourable demographics, in terms of population age and education, and cost efficiency are
the strong points that are supporting this leadership status. Also the industry is gradually transforming from a services based approach to a
solutions one thus carving a niche section for itself in the Global IT industry, which of late is seeing the emergence of low cost competitors
like China and the Philippines.
Strengths:
?Strong Brand Visibility of the Indian IT industry. The industry is renowned across North America and Europe and is expanding in the
Middle East.
?Cost Effectiveness and Demographic Advantages.
?Scalability amongst larger IT players to accommodate new business clients.
?Availability of talented and skilled workforce (entry-level) in the Indian market.
Weaknesses:
?Increased demand would lead to increasing competition (pricing pressure) and capital investments (fresh hiring, new facilities, etc.) which
would put pressure on net profit margins.
?Large exposure to the North American market. Small domestic exposure.
?Strong Rupee appreciation vulnerability. For every 1% appreciation in the Indian Rupee, operating profit margins of frontline IT firms
falls by 40 – 50 bps.
?End of tax sops (STPI 10A & 10B) and introduction of the Minimum Alternate Tax (MAT) in SEZs will increase the tax bill of IT firms.
Opportunities:
?IT Outsourcing trend to continue going forward. Business volumes are expected to grow nearly 16 – 18% YoY in FY12.
?Economic recovery in the Western (American & European) markets. The US GDP is expected to grow by 2 – 3% in CY11.
?Large untapped markets for IT industry. (Only 6% market share of Indian firms in the global IT industry. Source: Nomura)
?Expansion into new geographies like Eastern Europe and the Middle East.
?Increasing discretionary IT spending and improved IT budgets (2 – 3% of total budget) of large firms, especially Fortune 500
companies.
?Pricing upticks amongst IT services verticals (BFSI, Manufacturing, etc.). Going forward, pricing is expected to improve by 3 – 5%.
Threats:
?Increased wage inflation (especially for higher experienced professionals) could reduce the industry's cost effectiveness, allowing other
markets like China to capture market-share. Wage inflation is expected to be around 12 – 15% in FY12.
?Staff attrition could lead to manpower shortage, thus leading to inability of companies to increase business growth. This could also lead
to wage inflation.
?Protectionist reforms (increased visa costs in the US for example) could drive costs upwards.
?Multi-national IT firms like IBM and Accenture are setting up delivery centers in India. These companies may capture market share of
Indian IT firms due to their technological advantage and economies of scale.

Future Outlook:
As the developed economies emerge from recession and start growing again, demand for IT services is expected to grow at a stable rate. As
sectors like Banking, Financial Services & Insurance (BFSI), Healthcare, Manufacturing and Retail grow, their demand for IT services is also
expected to increase in proportion. Companies are showing signs of increasing their discretionary spending and billing rates are on the up-
move. According to NASSCOM, the Indian IT – BPO industry is expected to grow 16 – 18% for FY12. We believe these are reasonable
growth estimates for the sector. However, IT companies will have to develop capacities (hiring, facilities, etc.) to take advantage of this rise in
demand. Such issues could prevent net profit margins of these companies to improve going forward. Also the worry of protectionism,
especially in the US markets, could be a hurdle to the growth of the Indian IT industry in the near-term.
Our favourite stocks in the IT industry are Infosys Technologies Ltd. (Infosys), Tata Consultancy Services Ltd. (TCS), HCL Technologies
Ltd. (HCL Tech) and Rolta India Ltd (Rolta).

6
 Stock of the month
Rolta India Ltd:
CMP: `147* Target: `191

Rolta India Ltd. is a niche IT solutions firm based in Mumbai. The company caters to a whole host of sectors like Defense, Security, Oil & Gas,
Power, Business Intelligence, Enterprise Applications, etc. The company derives a major portion of its revenue from the Indian market, and
the rest from its operations across various countries around the globe.

Investment Rationale
?
Leadership position in the Geospatial Imaging and Engineering Design & Automation Segments:
With nearly 70% market share in the Geo-Imaging and Mapping Industry and 90% in the Engineering Design & Automation market in India,
Rolta India Ltd. is well poised to consolidate its leadership position in these segments on the back of key capital expenditures (amounting to
nearly INR 16 bn) and regular acquisitions that have helped to develop niche capabilities to service these sectors.

?
Evolution from a Services-centric Business Model to a Solutions Model:
Due to constant innovations and acquisitions of different companies, Rolta India Ltd. has developed a sizeable repository of intellectual
property (eg. Rolta iPerspective 2.0 for ERP solutions) that is aiding the company's transformation to break out from its Services centric
approach, a common theme of the Indian IT industry, to a high-margin 'Solutions' based business model. The management expects such high-
margin 'Solutions' sales to contribute nearly 20 - 25% to revenue by FY13, which is currently at 12%.

?
Diversified Geographical Presence and Impressive Client Base:
With nearly 55% of total revenue coming from the Indian market, while the rest spread out across various geographies like North America,
Europe and the Middle East, Rolta India Ltd., unlike its larger peers, is well insulated from foreign currency risks. Also as most of its clients are
government-based organizations, the company has strong assured revenue growth prospects going forward.

?
Strong Order-Book will lead to Revenue and Profit Visibility:
According to the management, the company's order book stood at INR 1.9 bn at the end of Q2FY11 with 90% executable in FY11 itself. This,
along with the company's ability to leverage its leadership status to find new business in the GIS and Engineering segments, should help it
improve its EBITDA margins by approximately 250 bps in the future. Reducing capital expenditure and repayment of high cost debt would
improve the company's bottom-line by 200 bps going forward.

Outlook & Valuation

Rolta India Ltd. has managed a compound annual growth rate of 29.2% and 13.8% in revenue and net profit respectively during the FY07 - 10
period. Going forward, we expect sales and profit to grow annually by 20.6% and 19.8% respectively. At the current market price of INR 147,
the company is trading at 6.5x its FY12 estimated EPS. Rolta India Ltd. has traded historically at a P/E of 9.28x on a TTM basis. We value the
company at 8.5x its FY12 estimated EPS and arrive at a 15-month target of INR 191, a potential upside of 30%.

* Price as on 5th April

7
 Technical Market Outlook
Economic Data
USA, April 2011 India, April 2011
?
Apr 05 - Minutes of FOMC Meeting ?
Apr 05 - India March Markit Services PMI
?
Apr 08 - Consumer Credit, Feb, Survey $4.800B, Prior $5.014B ?
Apr 07 - Food Articles WPI YoY, Mar 26, Prior 9.50%
?
Apr 12 - Import Price Index (MoM), Mar, Survey 1.90%, Prior 1.40% ?
Apr 07 - Fuel Power Light WPI YoY, Mar-26, Prior 13.13%
?
Apr 12 - Trade Balance, Feb, Survey -$43.0B, Prior -$46.3B ?
Apr 07 - Primary Articles WPI YoY, Mar-26, Prior 12.98%
?
Apr 12 - Monthly Budget Statement, Mar ?
Apr 08 - India Local Car Sales, Mar, Prior 189008
?
Apr 14 - Producer Price Index (MoM), Mar, Survey 1.10%, Prior 1.60% ?
Apr 11 - Industrial Production YoY, Feb, Prior 3.70%
?
Apr 15 - Consumer Price Index (MoM), Mar, Survey 0.40%, Prior 0.50% ?
Apr 14 - Monthly Wholesale Prices YoY% Mar, Prior 8.31%
?
Apr 15 - Industrial ProductionMar, Survey 0.60%, Prior -0.10%
?
Apr 14 - Food Articles WPI YoY, Apr 02
?
Apr 19 - Building Permits MOM%, Mar, Prior -8.20%, Revised -5.20%
?
Apr 14 - Fuel Power Light WPI YoY, Apr 02
?
Apr 19 - Housing Starts MOM%, Mar, Prior -22.50%
?
Apr 14 - Primary Articles WPI YoY, Apr 02
?
Apr 21 - House Price Index MoM, Feb, Prior -0.30%
?
Apr 21 - Food Articles WPI YoY, Apr 09
?
Apr 25 - New Home Sales MoM, Mar, Prior -16.90%
?
Apr 21 - Fuel Power Light WPI YoY, Apr 09
?
Apr 26 - Consumer Confidence, Apr, Prior 63.4
?
Apr 27 - Durable Goods Orders, Mar, Prior -0.90%, Revised -0.60% ?
Apr 21 - Primary Articles WPI YoY, Apr 09

?
Apr 27 - FOMC Rate Decision, Apr 27, Prior 0.25% ?
Apr 28 - Food Articles WPI YoY, Apr 16
?
Apr 28 - GDP QoQ (Annualized), 1Q A, Prior 3.10% ?
Apr 28 - Fuel Power Light WPI YoY, Apr 16
?
Apr 28 - GDP Price Index, 1Q A, 0.40% ?
Apr 28 - Primary Articles WPI YoY, Apr 16
?
Apr 28 - Personal Consumption, 1Q A, 4.00%
?
Apr 28 - Pending Home Sales MoM, Mar, 2.10%
?
Apr 29 - Personal Spending, Mar 0.70%
?
Apr 29 - Personal Income, Mar 0.30%

Technical Markets Outlook Nifty Monthly Technical Outlook

Nifty ended the month up 500 pts and closed positive (bullish
pattern) at 5833.75 levels, after making a low of 5348.20.
Technically Nifty on monthly chart has formed bullish candle stick
formation, which indicates buying pressure at 38.20% retracement
at 5690 levels. On monthly charts Nifty finds resistance around
previous top of 6100-6275 and supports are placed at 5675-5610
levels. Some leading indicators like MACD,RSI and Momentum
indicators are rising up and are in oversold condition, whereas
buying pressure at support levels and Nifty closed bullish candle
pattern with small lower shadow, so Nifty would continue till 6150-
6275 levels. If Nifty breaks above 6000, Nifty would take next area
of resistance 6150-6275 levels. Nifty is trading in a rising channel
and heading towards resistance at 6150-6275 levels. In wide range
Nifty has good supports at 5610 and resistance at 6600.
Stochastics and the RSI are oversold but remain sideways to
positive trading possible in short-term. For short term trading
long potions, stop loss of 5550 is advisable on closing basis. If
Nifty crosses higher levels above 6000, it can target 6150 and 6275
Source : Iris levels as well.

8
 Derivative Market Outlook
Sector Wise Roll Over And Volume Change Index Future Analysis
0.4 3 Change in OI Change in Volume
1100000
0.35
2.5 900000

Change in OI and Volume

0.3
700000
2
0.25 500000

0.2 1.5 300000

0.15 100000
1
-100000

MININIFTY

NIFTYMCAP50

NIFTY
CNXIT

BANKNIFTY
0.1
0.5 -300000
0.05
-500000
0 0
IT

Misc

Textiles
Logistics
Infra

Sugar
Media

Oil&Gas

Telecom
Bank

Hotel

Power

Realty
Cement

Pharma
CapitalGoods
Auto

Chem&Fert

Metal&Mining

Index

Change in OI
Roll Over Change in GDQ
13,000,000
CE PE
Index Option Analysis 8,000,000
CE PE
16000000
Open Interest
14000000 3,000,000
12000000
Open Interest

5000

5100

5200

5300

5400

5500

5600

5700

5800

5900

6000

6100

6200

6300
10000000 (2,000,000)

8000000

6000000 (7,000,000)

4000000

2000000 (12,000,000) Strike

0
5000

5100

5200

5300

5400

5500

5600

5700

5800

5900

6000

6100

6200

6300

Outlook
Strike Nifty recovered from its low in February and gained 600 points on
FII buying in the later stage of March month. The gain for the
March series was 10.85%. In the cash market, Nifty touched high
Top Five Gainers- Price of 5872 and low of 5232.75. Across all expiries, Put writing is seen
Change in at 5400-5500 strike prices and Call writing is seen at 5900-6000
Price - Future strike prices, suggesting 5400-6000 to be the broad zone in Nifty
RELCAPITAL 30.30% for short term. Global markets recovered after the Japan Tsunami.
APOLLOTYRE 29.97% Realty sector has seen contra-buying in the series. Infra stocks look
TVSMOTOR 27.51% good for short term. Midcap and Smallcap stocks are likely to see
DCHL 26.87% buying interest after the broad based rally in domestic markets.
IVRCLINFRA 26.32%
Rising crude price is still a concern though.
Highest Roll Over
Top Five Losers- Price
Roll Over Sector
Change in
Price - Future GTL 98.00% Telecom
MPHASIS -33.08% INDIACEM 95.50% Cement
PATELENG -14.32% RUCHISOYA 95.40% Misc
EDUCOMP -13.31% GODREJIND 95.10% Misc
JISLJALEQS -8.47% GTLINFRA 95.00% Telecom
KTKBANK -7.33%
Lowest Roll Over
Market Statistics Roll Over Sector
24-Feb 31-Mar Change PATNI 49.60% IT
Nifty 5262.7 5833.75 10.85% ADANIENT 53.20% Misc
SUNTV 53.90% Media
VIX 28.20% 22.18% -21.35% ONMOBILE 54.50% Telecom
PCR 1.01 1.04 2.97% BOSCH 56.70% Auto

9
 Mutual Fund round up

Top Performer across category

NAV Return
Scheme Name
31 March-2011 (%) Pick of the month
Sundaram-Select Thematic 21.21 8.30 IDFC Premier Equity Fund (A)
Funds-Fin Serv Oppor(G)
ICICI Pru Banking & Fin Serv-Ret(G) 19.31 7.70 IDFC Premier Equity Fund (A) is an open end equity diversified
UTI Transportation & Logistics(D) 14.92 7.51 scheme, it is to generate long-term capital growth from an actively
Bank BeES 1184.64 7.47 managed portfolio of predominantly equity and equity related
Reliance Banking ETF 1206.31 7.45 instruments. The last 1 year return stands at 13.80% (Absolute)
and 23.02% (CAGR).Since inception. Major investments of nearly
5.20% are in Banking/finance and 5% in Paints.
Top Movers : Equity Diversified Category
NAV Return
Scheme Name
31 March-2011 (%)
Reliance Banking Fund
UTI Transportation & Logistics(D) 14.60 7.51
Reliance Banking Fund is an open end equity banking scheme, it is
to generate continuous returns by actively investing in equity and
HDFC Long Term Equity(G) 16.72 7.41
equity-related or fixed-income securities of Banks. The last 1 year
ICICI Pru Target Returns-Reg(G) 14.45 6.64
return stands at 37.63% (Absolute) and 35.59% (CAGR).Since
DSPBR Small & Mid Cap-Reg(G) 17.25 6.56 inception. Major investments of nearly 44.40% are in PSU Bank
BNP Paribas Mid Cap Fund(G) 9.15 6.49 and 32% in Private Banks.

Top Laggards : Equity Diversified Category

NAV Return
Scheme Name
31 March-2011 (%)
HSBC Small Cap(G) 10.84 0.96
Escorts Growth(G) 70.42 1.46
Edelweiss Absolute Return(G) 11.20 1.91
JM Small & Mid-Cap-Reg(G) 4.84 2.08
Taurus Discovery(G) 14.0 2.11

FIIs in Cr NIFTY 50
MF Activity
Nifty Vs FII Equity inflows
2000 5900
40
5800
1500 30
5700
1000 20
5600
Billions

10
500 5500

0
5400
0
1-Mar
2-Mar
3-Mar
4-Mar
5-Mar
6-Mar
7-Mar
8-Mar
9-Mar
10-Mar
11-Mar
12-Mar
13-Mar
14-Mar
15-Mar
16-Mar
17-Mar
18-Mar
19-Mar
20-Mar
21-Mar
22-Mar
23-Mar
24-Mar
25-Mar
26-Mar
27-Mar
28-Mar
29-Mar
30-Mar

5300 -10
1-Mar

3-Mar

5-Mar

7-Mar

9-Mar

11-Mar

13-Mar

15-Mar

17-Mar

19-Mar

21-Mar

23-Mar

25-Mar

27-Mar

29-Mar

31-Mar

-500
5200 -20

-1000 5100 Equity Debt

-30

FII Nifty

Source: Accord Fintech for All MF Data

10
 Insurance
Birla Sun Life Platinum Advantage Plan
Key Features
?
A 10-year plan with a 5-year Pay Term Assured reduced for partial withdrawals as follows: Before the life
?
Option to enhance the financial security for your loved ones insured attains the age of 60, the Basic Sum Assured payable on
?
Complete control on your investments death is reduced by partial withdrawals made in the preceding two
years. Once the life insured attains the age of 60, the Basic Sum
Assured payable on death is reduced by all partial withdrawals
Objective made from age 58 onwards. Death benefit shall never be less than
This Plan gives you the advantage to choose from 2 Investment 105% of total premiums paid to date (excluding any applicable
Options – Guaranteed Option and Self-Managed Option. With the rider premium and/or underwriting extras) less any previous
Guaranteed Option your investments in the Platinum Advantage partial withdrawals.
Fund are safeguarded from any downsides in the capital markets.
And you also have options to enhance the financial security of your Maturity Benefit
loved ones, at a nominal additional cost.
You will receive the Fund Value at maturity. In addition, you will
receive an amount equal to the number of units in Platinum
Policy Terms Advantage Fund times the excess, if any, of Guaranteed Unit Price
?
Minimum: 10 years over the then prevailing unit price of this investment fund, if you
have opted for Guaranteed Option.
Entry Age
Surrender Benefit
Minimum Maximum
Entry Age 08 yrs 70 yrs In case of emergency fund requirements, you can surrender your
policy after the completion of five policy years, and receive the
Fund Value at that time.
Benefits
Tax Benefit Fund Access – Loan
As per extant tax laws, this plan offers tax benefits under Section In case of emergency fund requirements, you can surrender your
80C and Section10 (10D) of the Income Tax Act, 1961.Under policy after the completion of five policy years, and receive the
Section 80C, premiums up to `1,00,000 are allowed as a deduction Fund Value at that time.
from your taxable income each year. Under Section 10 (10D), the
benefits you receive from this plan are exempt from tax, subject to
Premium
mentioned exclusions.
Minimum: `25,000 p.a. if paid annually
Death Benefit Maximum: `30,000 p.a. if paid monthly, quarterly or semi-
annually
In the unfortunate event of the death of the life insured prior to
maturity, we will pay to the nominee the greater of (a) the Fund Premium Payment
Value as on date of intimation of death or (b) the Basic Sum Annual, Half-yearly, Quarterly or Monthly.

11
 Bond Market Outlook
During the month the money market continued to remain tight
particularly due to Advance Tax outflows as a result the yield on
GOI securities showed an upward trend. Market was not expecting
any relief in liquidity situation till the end of the financial year
In the Mid Quarter Monetary Policy Review held on 17th March
2011 RBI increased both the Repo & Reverse repo rate by 25 basis
points with immediate effect signaling thereby upward bias in
interest rates. Effectively the Repo rate now stands at 6.75% & the
Reverse Repo rate at 5.75%. The corridor although raised but
continues to remain at 1%. There was no change in other policy
rates as expected by the market. Central Statistical Organization
estimate of GDP growth at 8.6% for 2010-11 was in line with the
Reserve Bank’s projection made in the Third Quarter Review.
Wholesale Price Index (WPI) Inflation estimates on a year on year
basis was revised to around 8%, against 7% estimated in Third
Quarter Review.
RBI released the Issuance Calendar for Marketable Dated
Securities for the first half of 2011 – 2012 on 25th Mar'11. It plans
to raise `2, 50,000 crs in the first half of the ensuing year. This
works out to be around 60% of the total borrowings. The market
expected raising of around `2, 70,000 crs in the first half. And on
account of the lower figure announced by RBI, the market reacted
positively and the yields fell down after the announcement. During
the first half of the last financial year RBI had planned raising `2,
87,000 crs. And the first issue in the next financial year is expected
on 8th Apr'11. The borrowing was well spread throughout the half
year except that in the month of July the RBI plans to raise about
25% of the borrowing i.e. `63,000 crs. The trend of raising over
60% in the first half of the year is well pronounced mainly because
Tax revenue collection in the first half are lower and banks are
comfortable with the liquidity situation.
RBI on the same day released the calendar for auction of GOI
Treasury Bills for the first quarter of the Financial Year 2011 – 12.
The total auction planned for the ensuing quarter at `88,000 Crs is
much lower than `1,09,000 Crs. in the first quarter of 2010-11. The
Govt's Market borrowing programme comprises of only 364 Days
T-Bills which remains unchanged at `14,000 crs.
In our previous write up we had projected yields on actively traded
2022 bond to remain in the band of 7.95% to 8.15%. The said
security was trading at a YTM of 8.08% on 31st March. We expect
yields to go down in April 2011 by atleast 5 bps on a 10 year bond.
Currency Market Outlook
Rupee commenced stronger for the second day on Thursday,
March 31, 2011 tracking a steady to lower dollar in early Asian
trades. The US dollar index, which tracks the greenback against a
trade-weighted basket of six major currencies, is lower by around
0.06% at 76.07.
The domestic currency opened at `44.69 per dollar and edged up
to `44.68 in initial trades following a positive start to the local
shares and encouraging regional peers. Among Asian currencies,
the Taiwan dollar was higher by 0.05% at 29.48, the Indonesian
Rupiah 0.13% at 8708.75 while the South Korean won was up
0.25% at 1101.35 as against the US dollar.
Although foreign inflows witnessed in the last few days that normally
rise towards the financial year end as companies close their accounts
are expected to support the Indian currency, month end dollar
demand from importers is likely to cap some of the gains.
In the medium terms though, with oil prices remaining stubborn
and capital/portfolio flows not picking up as yet, we could
eventually see the rupee weakening to 46.00 by June 2011. Brent
crude rose over $1 on March 31st, 2011
to $116.78 a barrel, heading for its biggest quarterly gain in almost
two years, as Middle East supply worries led concerns.
In the domestic currency futures market on the NSE, the forward
month April USD/INR contract opened on 31 March, 2011 at
`44.84, higher than the spot market rupee. The NSE as well as
MCX April 2011 USD/INR contract was trading at around `
44.91 down 0.09% compared to previous close at ` 44.96.
We expect Currency to trade in between of 44.2 to 44.7.
Daily Movement
45.4
45.3
45.2
45.1
45
44.9
44.8
44.7
44.6
44.5
44.4
44.3
Source: rbi.org
12
 Real Estate Opportunities
LODHA CASA – RIO – Thane, Dombivali
We would like to introduce ourselves as The
Lodha Group, One of the India's Premier Real
Estate Developer.
The Group provides Stylish and Comfortable
living to over 19,000 families across Mumbai.
From Luxurious Garden Residences in South
Mumbai to Large Integrated Townships in the
Suburbs, Lodha caters to diverse consumers
needs across all segments. The Lodha Group is
developing Residences, Malls, IT Parks &
Weekend Retreats, across prime locations in
Mumbai. Lodha is now spreading its wings to
other rapidly developing Metros in Southern &
Western India. Headquartered in Mumbai, the
group is currently developing in excess of 32
million sq.ft. of prime real estate spread over
38 projects. A new sub-brand CASA by Lodha was created for the category to provide 'right sized' and 'right priced' products in Mumbai's
suburban locations. Also selected as one of India's top 10 builders by Construction World, the group has consistently delivered luxury lifestyles
through innovative solutions, not just by building structures but by building better lives.

CASA RIO by LODHA :

Over the years, Dombivali has swiftly blossomed into one of India's
most progressive cities. With a steady corporate influx, a
burgeoning economy, comprehensive infrastructure, not to
mention its proximity to Mumbai, Dombivali is fast emerging as the
perfect address for IT majors, BPOs as well as banking and financial
sectors.
In the midst of this bustling city, comfortably nestled near the
limpid waters of the Ulhas River, lies Palava's city most coveted
residential address:
Conveniently located on Kalyan-Shil Road, Palava, this prestigious
address is just 20 minutes from Thane and 10 minutes from
corporate hubs in Navi Mumbai.
Away from Mumbai's maddening traffic and swarming crowds, on
Kalyan-Shil Road, discover a tranquil retreat, the Universe of
unmatched luxury and serenity. One of Mumbai's finest integrated
planned township.
Resplendent on a vast 134-acres, CASA RIO presents 151 spectacular residential towers featuring 1/ 2 / 3 bhk premium Luxury Homes.
Surrounded by the river beyond the Landscaped. The township is arranged around Numerous Water Fountains, Reflecting Pools, Streams
and a Lily Pond speckle the vast Central Green rich in lush plantations and exotic flora. Every abode at CASA RIO faces a beautiful theme
feature and partakes of the tranquil essence of the sublime landscape.

13
 Real Estate Opportunities
Project Highlights:
?
Spread over a sprawling 134 acres of land with an Island Concept
?
Nilje railway station and a transport hub is at your doorstep
?
World-class Landscape Architect Design by PBB Group
?
International Infrastructure Design by WSP Group, U.K.
?
Master Planning & Architectural Design by RSP (India)
?
75% of total open space dedicated to natural preservation
?
151 Towers of 8 & 18 Storey each
?
24x7 power supply and Abundant water supply
?
World-class ICSE School
?
State-of-the-art Medical facility with polyclinic, diagnostic centre & pharmacy, managed by Hinduja Hospital
?
Post Office, Fire station, Police Station
?
Mall, Retails & Multiplex
?
Impressive central square with One of Mumbai's largest clubhouse with Gymnasium & Swimming pool, spread over 1,00,000 sq.ft.
?
Riverside promenade with walkways/ plaza's & ground
?
All the Apartments in the township are with balcony
?
Transport hub- Efficient bus service to and from Dombivali & Ghansoli railway station

Wave City – Greater Noida, Yamuna Expressway

Wave City Yamuna Expressway comprises of 3000 plots in 1st phase and is designed to rejuvenate your lifestyle.
Project Snapshot:
Wave Infratech presents Wave City on Yamuna Expressway, Greater Noida. It will be a a new age city, which appeals to every aspect of urban design
principles. This ultra modern city has been meticulously planned with emphasis on open areas and ambience that would pamper your senses and bring
you all the leisure's of the urban life.
With acres of greens, wide congestion free roads, Wave City is a city full of vigor and vitality, designed to take care and bring smiles to all its citizens. The
landscaping for this extravagant city has been done by world class landscape planners, as they gave shapes to your dreams.

Wave Infratech About Developer:

For over three decades, Wave Infratech (formerly known as The Chadha Group) has been at the forefront of evolution of the Indian industry.
Leading its journey from strength to strength, the Chadha Group has grown from a small jaggery mill, to a business conglomerate, with
interests in multiple industrial sectors. In the year 1968, Kulwant Singh Chadha started the journey of this pioneering group, along the road of
success. Today, the group is actively involved in Food Processing, Paper Manufacturing, Sugar, Distilleries & Power Manufacturing, operation
of Bottling Plants, Retailing of Liquor, Real Estate Development as well as Film Distribution. In keeping with the times, the group's recent
focus has been on its Real Estate and Film Distribution divisions.

14
 Commodity round up
Geopolitical tensions in the Middle East continue to dominate commodities….
Geopolitical tensions in the Middle East and North Africa continued
to dominate the headlines and directed financial market movements.
Later on in the month the focus shifted from the turmoil in the Middle
East and North Africa to the impacts of Japan's massive earthquake
on global economic growth. While Bank of Japan has set up an
emergency task force and pledged to provide liquidity, the disaster will
inevitably delay the recovery of the world's third largest economy.
Financial markets slumped with equities fell across the board and
commodities slipped. While fighting in Libya continued, the market
has already priced in a prolonged period of political and economic
disruption in the area with significant amount of oil and energy
capacity suspended for years. Macroeconomic indicators showed that
global economic recovery has gathered momentum. While the
surprising drop in US initial jobless claims spurred optimism that the
country's job market has been improving gradually, disappointing
durable goods orders and falls in both existing home sales and new
home sales data indicated consumer spending remained constrained.
Both ISM manufacturing and non-manufacturing indices rose to 7-
year highs in February. US' employment data have improved further.
Non –farm payrolls unexpectedly added 192K in February while
January's reading was revised up to +63K. Unemployment rate
surprisingly slipped to 8.9% in February from 9% in the prior month.
Among the 3 central banks meeting, the ECB meeting caught most
attention as Trichet's comments on an interest rate hike triggered
speculations that the low-rate climate is going to change.
Gold prices hit a new all time high $1448.6 an ounce on COMEX as
Japan's earthquake, sovereign concerns in the Euro zone and
geopolitical tensions in the MENA region spurred safe-haven
demand. Although geopolitical tensions, sovereign crisis and
uncertainties in Japan will continue to cause volatility in gold, the
metal will be very much influenced by change in monetary policy.
Going ahead the major focus will be ECB's rate hike. President
Trichet's comments at the press conference after the
announcement will surely move prices. While the next FOMC
meeting will not be held until April 24, speeches from Fed members
will be closely watched.
Gold once again, underperformed silver with the benchmark
contract, jumping to a new 31-year high of 38.18. Going ahead
price outlook for the white metal remain volatile as fundamentals
are relatively weak. After ending 2010 with a strong tone, gold price
has underperformed at the beginning of this year as improvement
in risk appetite drove investors to stock markets. The yellow metal,
however, gathered momentum again in later-January and has
remained strong since then. While geopolitical tensions in the
MENA region have bolstered gold recently, expectations that US
inflation is bottoming have been supporting the metal. The Fed,
while pledging to pay 'close attention to the evolution of inflation
and inflation expectations', has no intention to alter it
accommodate monetary stance as recent upward pressures from
commodities are 'transitory'. Negative real interest rates encourage
gold purchases as investors see to diversify their cash holdings.
Negative real rates are not only seen in the US dollar but also the
pound and the euro. With the ECB beginning to increase interest
rates, gold may be weighed down.
Crude oil future prices continued its northward journey since the
start of year 2011. The WTI crude oil future prices were up by
more than 10 percent in the month of March on monthly basis.
Although the rise was lesser as compared to February month when
the counter rose by 15 percent. The rally in counter was mainly
driven by ongoing concerns in the MENA region which raised
worries of supply disruption. Further the rise in crude oil imports
in US, which is the major consumer of crude oil, was another
boosting factor for oil prices. According to the government, it was
reported that U.S. crude oil imports rose for a third month running
in January as the stronger economy boosted fuel consumption and
as shipments recovered from a two-month dip. Crude imports
averaged 9.069 million bpd in January, a rise of 438,000 bpd from
December, as per the Energy Information Administration in a
monthly report. The EIA raised its 2011 world oil demand growth
forecast by 70,000 barrels per day from its previous estimate. The
agency now expects global oil demand to climb 1.51 million bpd in
2011 from 2010. It is expected that crude oil prices can remain
firm in the coming weeks as the geo-political tensions and
concerns of supply disruption will give some support to the
counter. But sustained higher oil prices can damage the world
economy. If oil prices continue to be above $100 a barrel
throughout the year, then it will certainly be unfavorable for the
economic recovery all over the world.
Base metals traded with negative bias in the month of March as the
geo-political tensions hit the risk appetite of market traders and
shifted the focus towards safe heaven investments like precious
metals and government bonds. Of the base metals complex lead
was the only counter which held to its strength. Lead future price
on MCX in the month of March was up by around 6%.The red
metal “Copper” which is known as the king of base metals was
down by around 5% in March. The fall in copper prices was mainly
due to concerns of monetary tightening in China, which is the
major consumer of copper. Import of refined copper in China in
the month of February tumbled 35.6 percent from the previous
month to a 27-month low because of holidays in the shortest
month of the year and high stocks. Imports fell to 158,185 tons in
February, the lowest since November 2008 and down from
245,617 tons in January 2011, according to data from the General
Administration of Customs. The global zinc market was in surplus
by 35,300 tons in January, according to the latest monthly bulletin
from Lisbon-based International Lead and Zinc Study Group.
Global refined zinc use amounted to 1.087 million tons in January
compared with 921,000 tons in January 2010. World refined zinc
output rose to 1.123 million tons from 1.012 million a year earlier.
The other metal lead was in surplus by 1,300 tons in January.
Global refined lead use was 812,700 tons in January, up from
718,000 tons in January 2010. World refined lead output was
814,000 tons, also up from 718,000 tons a year earlier. The
concerns of monetary tightening in the world's major consumer
of base metals and global surplus stocks in zinc and lead will
pressurize base metal prices in the coming weeks. But, looking at
the longer term perspective, we may see some demand coming
from Japan for re-construction after a major hit by the massive
earth quake.
15
 Alternate Investment Idea
JM Financial Real Estate Income Fund
Why Real Estate? Why JM Financial Real Estate Income Fund?
Lower volatility than equity markets
? ?Track record of investment in Real Estate, Private Equity, PIPE
?
Annual rental income and secondary markets
?
Stable and growing value potential ?
International Real Estate Investment Banking and Capital
?
Good hedge against inflation Markets expertise
?
Diversity in portfolio is important ?
Executed and structured debt packages
?
Exposure to large Class A assets ?
Architectural engineering & design, project and construction
management in place.
?
HNWI's allocate 14-24% in real estate
?
Extensive relationship network throughout the country
?
Robust deal sourcing capabilities
Why Now?
?
High quality execution capabilities across diverse products and
?
Share market recovery, GDP growth, increased business
sectors; strong structuring and regulatory expertise
confidence and conditions are leading to business expansion,
?
Extremely familiar with Indian real estate markets and well
hiring, and as a result, demand for office space is growing.
networked in India
?
Office and retail supply/demand dynamics are improving.
Rents are stabilizing and/or growing
?
Property valuations are beginning to increase

JM Financial Real Estate Income Fund Strategy

Assets Tier 1 Commercial, Retail, and Industrial/Warehousing assets.
Strategic Locations Selectively identify locations with limited supply and growing demand, coupled with favourable local
market dynamics.
Quality Properties Investments in high quality buildings with a plan for continuous improvements and upgrades to grow
value over time.
Unique Leverage management's well-entrenched real estate networks to access propriety deal flow and
Characteristics identify premium properties.
Stable Tenants Properties that attract: Solid blue chip companies, established operators with pan-India presence and
governmental tenants.
Solid Leases Long term leases with renewal option and lock-ins, NNN basis when applicable, large deposit, and
high rental escalations.
Optimal Most efficient use of various equity & debt instruments to maximize investors return. Debt at
Capitalization lower rates increases equity returns.

Fund Terms
Size of the Fund `250 crore (with a Greenshoe Option of `250 crore)
Term of the Fund 5 Years, with 2 potential extensions of 1 year each
Reinvestment Option Option to reinvest capital (during the first 3 years)
Stucture SEBI Registered Venture Capital Fund
Minimum Investment `20 lakhs (for individuals, trusts, partnership firms..)
`10 lakhs if 100% given upfront
`1 crore (for corporates/banks/institutions)
Commitment Period 24 months
Drawdowns 3 draw downs (40%, 30%, 30%)
Reinvestment Option Option to reinvest capital (during the first 3 years)
Management Fees 2.0% p.a. of the Capital Commitment over the commitment period and thereafter 2.0% p.a. of the
Capital Contributions as reduced by returns of capital 2% set up Fee
Carried Interest 15% with catch up on a 10% Hurdle Rate
Sponsors Contribution 10% (ex. greenshoe)
Annual yield Estimated 7% pre tax per annum
Target Return 18% IRR gross including yield and capital appreciation
Legal Counsel AZB & Partners
Tax Counsel KPMG
Trustee IL&FS Trust Company Ltd

16
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