Pathfinder June 2011

8/6/2019 Pathfinder June 2011

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June 2011 A Monthly Wealth Journal

The Path To WealthWEALTH MANAGEMENT

ASSOCIAFOR LI



Equities | Commodities | IPO | Mutual Fund | Insurance Distribution

Wealth Management | PMS | Investment Banking | Fixed Income | Property Broking

Watch how your w ealthhas the potent ial to make it big.

With right resources in hand, expanding your wealth seems asamusing as discovering a stone look like a gem, on magnifying.UNICON Wealth Management, likewise, strives to increase your wealth.We assign Relationship Manager to each active trader who evaluatesall financial opportunities for you and takes the best care ofyour investment portfolio. So that, big returns come your way.

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NCDEX Reg. No.00721 , FMC Code: NCDEX/TCM/CORP/070 6 Disclaimer: All investments in Securities & Commodities are subject to market risk.



Contents

Editor Vijay Agrawal

Assistant Editor Yatish Pandey

Wealth Management

Unicon Financial Intermediaries. Pvt. Ltd.

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DISCLAIMER :This documen t has been issued by Unicon Financial Intermediaries. Pvt. Ltd. (“UNICON ”) for the information of its customers only. UNICON is governed by the Securities and Exchan ge Board of India. This documen t for public distribution and has b een furnished to you solely for your information an d must not b e reproduced or redistributed t o any other person. Persons into whose possession this docu ment may come are required to observe these restrictionsinformation and opinions contained herein have been compiled or arrived at based upon information obtained in good faith from public sources believed to be reliable. Such information has not been independently verified and no guaranrepresentation or warranty, express or implied is made as to its accuracy, completeness or correctness. All such information an d opinions are sub ject to change without n otice. This docum ent has been produced ind ependent ly of any compacompanies ment ioned herein, and forward looking statements; opinions and expect ations contained h erein are subject to change without not ice. This documen t is for information purpo ses only and is provided on an “as is” basis. Descriptions ocompany or companies or their securities mentioned h erein are not intended to b e complete and th is document is not, and should not be con strued as an offer, or solicitation of an offer, to buy or sell or subscribe to any securities or other finainstrumen ts. We are not soliciting any action based on this documen t. UNICO N, its associate and grou p companies its directors or employees do not take any responsibility, financial or otherwise, of the losses or the damages sustained d ue tinvestments made or any action taken on basis of this document, including but not restricted to, fluctuation in the prices of the shares and bonds, reduction in the dividend or income, etc. This document is not directed to or intended for dispdownloading, printing , reproducing or for distribution to or use by any person or entity who is a citizen or resident or located in any locality, state, country or other jurisdiction where such d istribution, pub lication, reproduction, availability owould be contrary to law or regulation or would subject UNICON or its associates or group companies to any registration or licensing requirement within such jurisdiction. If th is document is inadvertently sent or has reached any individual incountry, the same may be ignored and brought to the atten tion of the sender. This docum ent may not be reproduced, distributed or pub lished for any purpose without prior written approval of UN ICON . This document is for the general informand does no t take into account t he particular investment objectives, financial situation or needs of any individual customer, and it do es not constitute a p ersonalized recommendation of any particu lar security or investment strategy. Before actinany advice or recommendation in this docu ment, a customer shou ld consider whether it is suitable given the customer’s particular circumstances an d, if necessary, seek professional advice. Certain transactions, includin g those involving futoptions, and high yield securities, give rise to substantial risk and are not suitable for all investors. UNICON, its associates or group companies do not represent or endorse the accuracy or reliability of any of the information or content odocument a nd reliance upon it is at your own risk.

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The results for the state elections in 4 states were declared last month and it tuout to be largely positive for the ruling UPA government. The third term winAssam for the Tarun Gogoi led Congress Legislative Party is remarkable awould lead to further engagement with the state. The removal of the left in WBengal after 34 years of rule by Mamta Banerjee led Trinamool Congress iwelcome change and would set the stage for greater economic developmentthe state. In Tamil Nadu, the Jayalalitha led AIADMK comfortably defeated DMK party, which had become unpopular due to its involvement in the 2scam. The congress could now form an alliance with AIADMK and strengthits position. In Kerala, the congress led UDF won by a narrow majority over LDF. These political changes are expected to be positive for the growth adevelopment of the country.

The electoral vote against DMK in TN was largely people's vote against corruptiThe Indian society, especially the middle class and the poor, which have losuffered due to corruption in government, bureaucracy and the industry hastarted speaking out against corruption and this has put the government on back foot. Among other officials, CBI has now charge sheeted Kanimozi, tDMK MP for allegedly conspiring with former telecom minister A Raja in the 2scam case. The industry has also been a part of the corruption and is now takinserious note of the developments taking place. These developments could hasome short term negative impact on the markets but should be good for the Indsociety and the markets in the long run.

The fight against inflation continued as RBI raised the repo rate and reverepo rate by 50 bps to 7.25 and 6.25 respectively. This is expected to shodown the growth as demand in interest rate sensitive sectors like auto a

housing slows down. The food inflation can come down in the commonths following a good monsoon, but the fuel inflation is likely to increasepetrol process has recently been hiked. The IIP growth continued to volatile as it grew by 7.3% in March following a 3.7% growth in Feb. Tnegative impact of monetary tightening is showing on the growth as the GDgrowth for the Q4 for FY11 slowed down to 7.8%, which is the slowest ratethe past 5 quarters. The annual growth rate for FY11 was 8.5% and is beprojected to be 8-8.5% for FY12.

A move towards a corruption free society and good governance together wstable government could have a favorable long term impact on the Indieconomy and would continue to make it a favorable investment destination.

Regards,Gajendra Nagpal

Founder & CEO

Unicon Financial Intermediaries Pvt. Ltd.

The Road Ahead

Alternative Investment Ideas 16

Commodity round up 15

Real Estate Opportunities 13-14

Currency Market Outlook 12

Bond Market Outlook 12

Insurance 11

Mutual Fund round up 10

Derivative Market Outlook 9

Technical Market Outlook 8

Stock pick of the month 7

Sector of the month 6

Model Portfolios 4

Market Round Up -Equity 3

Wealth Overview 2

The Road Ahead 1



Boond Boond se Ghada Bharta hai

The Financial markets have turned choppy again in the month of May & a lot of confusion is spreading around post the major events whtook place during the month. On the global markets front, the major concerns came related to sovereign debt risk within the Greece economcoupled with a visible slowdown in Japanese and Chinese growth led to a sell off towards the middle of the month. The commodities marktoo came off towards the middle of the month along with crude in particular, which fell from the highs of $125/ barrel to $114/ barrel. On tdomestic front, the major surprise came in the form of lower than expected GDP of 7.8% again an expectation of 8.1%. Apart from ththe major concern in the domestic market is of stubbornly high inflation coupled with still rising interest rates.

The above conditions are looming large on the mood of the financial markets & they are trying to find the clues to tackle the above difficenvironment. The net result is that the investors are getting confused regarding whether to put funds in the current market situation or wait the correction. The confusion is persisting not only in the equity markets but across the asset classes in general. The million dollar question

whether to invest now or should the investors wait for more correction across the asset classes.

We have been suggesting to our customers clearly two approaches:

Follow a well disciplined asset allocation strategy

Adopt SIP way for wealth creation

To build investment portfolios through SIP is always a better way be it a case of single asset or multi asset portfolio. Let's see what are tbenefits of investing via SIP mode of investment?

Inculcating Saving H abits: There is an age old saying“Boond Boond se Ghada Bharta hai” means a small sum of money saved over oregular basis gives you handsome returns over a long period of time. SIP works on the principle of regular investments. But one thing to kein mind is that you have to stay focused, invest regularly and maintain discipline in your investing pattern. It's easier to save few thousands evmonth rather taking out lacs in one shot.

Benefits of early stage investing: It's always beneficial to start investing early in life. It has got dual benefits: first, in the initial stages of lyou must be having low expenses to income ratio hence it becomes easy to save for the financial goals, second it provides the benefit ocompounding too & you end up really creating a bigger corpus for yourself.

Rupee cost averaging:When you invest a particular sum at regular intervals over a number of years, its' but natural, you end up buying at an average cost whichnormally less than the one time buying cost This is especially true for investments in equities/ mf investments where the units are lowernature. The rationale behind this is that with a sensible and long-term investment approach, rupee cost averaging can smoothen out tmarket's ups and downs and reduce the risks of investing in volatile markets. If you invest through SIP mode of investment you are ablecapture the lows as well as the highs of the market movements hence your average cost of investing comes down.

SIP makes achieve your Financial Goals easy:Imagine you want to buy a house 3 years from now but you have no funds for the same. You may decide to take a housing loan but you arunning short of down-payment component as well. By investing at a periodic interval targeting to create a corpus equivalent to the dopayment component, you may be able to buy the dream house. But if just try to take the funds out of your savings on ad-hoc basis; it m

happen that you are again running short of the funds at the time of executing the transaction. So to achieve your financial goals it's always eto build the corpus by way of SIP.

Before I conclude I would like to clarify one myth that SIP is only a preferred route for Mutual fund investments only. In fact these datechnology has enabled us to adopt SIP mode of investment for all class of assets viz. direct equity, mutual funds, commodities, gold, silver aPMS etc. So don't wait for a big lump sum to create corpus for the rainy days, start as early as possible by following SIP mode as you kno“Boond Boond se Ghada Bharta hai”.

Happy Investing !!!

Rajev B Sharma

Country Head – Wealth Management & Investment Banking

Unicon Financial Intermediaries Pvt. Ltd

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Wealth Overview



Market Round Up -Equity

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Sectoral Indices Performance?

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Among the BSE sectoral indices, FMCG (+2.74%), H

(+2.57%), CD (+2.44%), CG (+ 0.42%) ended positive.

Auto (-6.56%), PSU (-5.38%), Metal (-4.81%), Bank

(-4.08%), Oil&Gas (-4.14%) ended negative. Among oth

indices, BSE MidCap (-2.59%), SmallCap (-5.50%), BSE1(-2.71%) ended negative.

Market News

Highlights?

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Major global indices ended negative in May month.In the US markets, Dow (-1.88%), Nasdaq (-1.33%), S&P500(-1.35%) ended negative.

In the Asian Markets, Nikkei (-1.58%), Hangseng (-0.15%)ended negative.In the European markets CAC (-2.43%), FTSE (-1.32%)ended negative on weak global cues.On the domestic front, Nifty lost 189.35 points (-3.29%) andSensex lost 632.68 points (-3.31%) in the month of May.NSE Cash Turnover: 233,875 cr up 2.42% as compared toprevious month ( 228,348 cr)Total Derivative Turnover: 2,605,13 up 10.8% as comparedto previous month ( 2,351,300 cr).Turnover in index futures increased by 8.30% over theprevious month.Turnover in index options increased by 15.01% over theprevious month.

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Index May-11 Change Change % High Low

Sensex 19,135.96 18,503.28 -632.68 -3.31% 19,253.87 17,786.13

Nifty 5749.5 5560.15 -189.35 -3.29% 5,775.25 5,328.70

Apr-11

Domestic Markets

Sectoral Indices

Nifty Index PCR

Turnover

(` crs.)Index Futures 282302 305744 279572 8.30%

Stock Futures 353159 336688 409844 -4.66%

Index Options 1645880 1892896 905472 15.01%

Stock Options 69957 69808 76731 -0.21%

Total 2351300 2605137 1671620 10.80%

Apr-11 May-11 Apr-11 MoM

Change%

Global Markets

Index Apr-11 May-11 Change Change % High Low

Dow Jones 12,810.54 12,569.79 -240.75 -1.88% 12,928.45 12,271.90

Nasdaq 2,873.54 2,835.30 -38.24 -1.33% 2,887.75 2,739.85

S&P 500 1,363.61 1,345.20 -18.41 -1.35% 1,370.58 1,311.80

Nikkei 9,849.74 9,693.73 -156.01 -1.58% 10,017.47 9,406.04

CAC 4,106.92 4,006.94 -99.98 -2.43% 4,137.97 3,884.55

FTSE 6,069.90 5,990.00 -79.9 -1.32% 6,103.70 5,810.50

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FIIs were net sellers of ` 3705 cr (In Apr net buyers of 4.4 cDIIs were net buyers of ` 4093 cr (In Apr net sellers of ` 558 in cash market.IPOs open in May 2011: Sanghvi Forging & Engineering LtAanjaneya Lifecare Ltd., Power Finance Corporation Ltd (PFFPO, Galaxy Surfactants Ltd., Timbor Home Limited.

IPOs listed in May 2011: Muthoot Finance Ltd., ParamouPrintpackaging Ltd., Future Ventures India Ltd., ServalakshPaper Ltd., Innoventive Industries Ltd., Sanghvi Forging Engineering Ltd., Power Finance Corporation Ltd., AanjaneLifecare Ltd.,India's economy grew 7.8% in the fourth quarter of 2010-the slowest in a year, as rising interest rates and input costs pulldown manufacturing growth to a 21-month low. While induschambers attributed this to a tight monetary policy, economisaid the Reserve Bank of India (RBI) might continue to mamoney dearer, unless inflation fell sharply.India's largest lender State Bank of India's fourth quarter nprofit disappointed the street. Net profit tumbled nearly 99year-on-year to ` 21 crore on higher provisioning against no

performing assets and gratuity. The bank's January-Marquarter net interest income was up 20% year-on-year to ` 80crore. Net interest margin sequentially fell 31 bps to 3.3% in QFY11.Tata Motors Results: Consolidated net profit tripled to `9,2crore in 2010-11 (April-March) due to a strong performance froits luxury Jaguar Land Rover unit. Consolidated revenues for tfull year were up 33% from a year ago to `1,23,133 crore aEBITDA margin was at 14.4%, up from 9.3% a year ago. Tcompany's standalone net profit declined 19% year-on-year ` 1,812 crore in 2010-11 due to exceptional gains in 2009-1Rising commodity costs and competition pressures also ppressure on its standalone earnings, leading to a lower EBITDmargin of 9.9%.

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P C R

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TECk

REALTY

PSU

POWER

OIL&GAS

METAL

IT

HC

FMCG

CG

CD

BANKEX

AUTO

Change (%)



Model PortfoliosThe markets corrected sharply in the first half of May with the

Nifty falling from ~5700 levels to 5300 levels. It however recovered

in the second half of the month and closed with a loss of 3.3% at

5560. The macro headwinds have turned slightly negative with the

global scenario looking a little weak. The US is struggling with

dropping consumer confidence, sluggish job market and a

depressed real estate market. On the domestic front, concerns of

rising crude prices, below expectations IIP numbers and high

inflation continue to put pressure on the markets. However the

structural growth story remains intact and we believe that the

market is fairly valued at this juncture, with the Nifty index trading

at 14.7x one year forward consensus earnings. We expect the

markets to remain range bound and consolidate within a wide band.

Performance Highlights?

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The portfolio has underperformed the Nifty by 8.7% since

inception and 0.5% in the month of May 2011.

United Phosphorus, Crompton Greaves and Deepak Fertilisers

were the only stocks with positive gains in the month.

Tata Motors, BGR Energy, Aurobindo Pharma and Shree

Cement were the laggards during the month all losing more

than 9%.

Performance Highlights

?Bank of Baroda, ICICI Bank, Infosys and Aurobindo Phar

were laggards during the month, all losing more than 2%.

Strategy

Stock movement

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The portfolio suffered this month on account of the au

energy and infrastr ucture sectors, all of whi

underperformed during the month.

Despite the underperformance we remain positive on the au

space. In line with our strategy we would look to increase oexposure to the banking, IT and agri related stocks during t

month and reduce our exposure towards the infrastructu

and construction sector where execution remains an issue.

Stock Entered

No Changes during the month

Stock E xited

No Changes during the month

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% Returns Growth Nifty

Since inception 49.3% 21.1%

Performance + 28.2%

For month of May 0.9% -3.3%

Performance + 4.2%

Top 5 Sectors Wtg

IT Software 19.5Pharmaceuticals 13.2Chemicals 11.1Banking & Finance 10.3FMCG 9.2

Moderate Capital appreciation with substantial capital safeSkewed towards Growth, value and large caps

Optimizer Portfolio

Objective

1 Hero Honda 4.3% 1544.30 1853.15 20.0% 8.4%

2 Bank of Baroda 6.7% 425.65 863.40 102.8% -5.3%

3 ICICI Bank 2.9% 1205.00 1086.00 -9.9% -2.5%

4 Syndicate Bank 0.6% 156.00 116.95 -25.0% 0.0%5 Larsen & Toubro 3.7% 1516.00 1644.00 8.4% 2.9%

6 Crompton Greaves 3.6% 261.10 263.90 1.1% 4.6%

7 Castrol India 11.1% 240.93 497.15 106.4% 6.2%

8 Oil India 7.5% 1140.55 1286.35 12.8% -7.2%

9 Dabur India 9.2% 70.65 116.85 65.4% 15.5%

10 TCS 11.6% 532.95 1158.80 117.4% -0.4%

11 Infosys Tech 3.0% 2615.10 2791.85 6.8% -3.9%

12 HCL Tech 4.8% 358.85 514.80 43.5% -1.1%

13 Glaxosmith Pharma 7.7% 1454.40 2322.50 59.7% 2.9%

14 Aurobindo Pharma 5.4% 191.76 176.65 -7.9% -9.2%

15 Bharti Airtel 3.1% 405.35 374.15 -7.7% -1.2%

Cash 14.5%

Total 100.0% 49.3% 0.9%

Sr. Stock Nam e % Wtg Rec.P riceNo May-2011 (Since Inception) May-20

Price 31st % re turn %retur

Growth Portfolio

Objective

High Capital appreciation with moderate capital safety.

Fertiliser & Chem 16.3%Power 11.8%Oil and Gas 10.8%Banking & Finance 9.7%Auto & Auto Ancillary 9.5%


Performance -8.7%

For month of May -3.8% -3.3%

Performance -0.5%

1 Union Bank 3.7% 326.75 317.95 -2.7% -0.5%2 Yes Bank 6.0% 270.50 300.35 11.0% -1.6%3 Crompton Greaves 5.3% 177.35 263.90 48.8% 4.6%4 Shree Cement 6.5% 1725.59 1822.50 5.6% -9.2%5 IVRCL Infra 4.5% 171.55 73.00 -57.4% -7.8%6 HCC 2.8% 61.50 32.30 -47.5% -8.6%7 UTV software 6.2% 465.40 647.55 39.1% 0.0%8 Aurobindo Pharma 4.7% 192.10 176.65 -8.0% -9.2%9 Apollo Tyre 4.2% 58.80 68.85 17.1% -0.7%10 Tata Motor 5.3% 1113.00 1092.50 -1.8% -11.1%11 MSP Steel 3.2% 72.00 52.15 -27.6% -7.8%12 GAIL 5.6% 356.25 445.45 25.0% -6.4%13 Reliance Ind 5.2% 973.00 951.75 -2.2% -3.1%14 Navbharat Venture 6.2% 397.80 231.65 -41.8% -5.6%15 BGR Energy 5.7% 612.00 489.25 -20.1% -11.0%

16 Deepak Fertliser 7.8% 162.00 177.30 9.4% 4.5%17 United Phosphorus 4.5% 135.80 162.10 19.4% 6.7%18 Jain Irrigation 4.0% 188.40 167.40 -11.1% -8.4%

Cash 8.7%Total 100.0% 12.4% -3.8%

Sr. Stock Name % Wtg Rec.Price Price 31st % return

N o May-2011 (Since Inception)

May-2011

%return

Top 5 Sectors Wtg% Returns Growth Nifty



Model Portfolios

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Consumption demand is holding up well, especially auto

demand. Exports have improved due to stable global economy.

However, infrastructure and corporate capacity expansion

projects are observing implementation delays.

We believe high inflation, interest rate hikes and volatile industrial

growth can hamper domestic growth in near term. However,

Indian consumption story is still intact and lower valuations

would be seen as a buying opportunity in the market.

We've have not made any changes in the portfolio in this month.The stocks in our portfolio represent best picks in the theirrespective sectors and some hold further potential for upsidefrom the current levels.Consumption demand is holding up well, especially autodemand, whereas there is a clear slowdown in theimplementation of projects, especially infrastructure andcorporate capacity expansion. On the other hand, exports are

surprising on the upside because of stabilization of globalrecovery.We believe high inflation can make central bank be moreaggressive in terms of interest rate with can hamper the growthin the coming quarters. However the long term story is still intact.

Stocks Entered

No changes during the month

Stocks E xited

No changes during the month

Strategy

Stock movement

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Sr. Stock N am e % Wtg Rec.P riceNo May-2011 (Since Inception) May-2011

Price 31s t % return %return

Concentrating on stable large cap, blue-chip companies aimed atclients with moderate to low risk appetite.

Defensive Portfolio

Objective

1 Punjab National Bank 2.4% 678.45 1099.70 62.1% -7.3%

2 Bank of Baroda 2.1% 425.65 863.40 102.8% -5.3%

3 ICICI Bank 0.9% 950.00 1086.00 14.3% -2.5%

4 BHEL 8.2% 2082.96 1944.10 -6.7% -2.8%

5 Crompton Greaves 2.1% 261.10 263.90 1.1% 4.6%

6 Dabur India 2.5% 69.20 116.85 68.9% 15.5%

7 Godrej Cons. Product 8.5% 235.15 417.50 77.5% 10.9%

8 Gillette India 2.7% 1414.25 1865.70 31.9% 1.7%

9 Britannia Ind 1.7% 440.00 417.30 -5.2% 12.9%10 Castrol India 11.3% 240.93 497.15 106.4% 6.2%

11 Larsen & Toubro 6.2% 1510.70 1644.00 8.8% 2.9%

12 Dr. Reddy's Lab 3.1% 765.45 1616.25 111.2% -2.8%

13 Glaxosmith Pharma 7.7% 1454.40 2322.50 59.7% 2.9%

14 NTPC 5.7% 205.55 168.95 -17.8% -7.1%

15 Oil India 7.8% 1140.55 1286.35 12.8% -7.2%

16 Reliance Industries 2.6% 955.00 951.75 -0.3% -0.3%

Cash 24.6%

Total 100.0% 45.3% 0.8%

% Returns Growth Nifty


Performance + 24.2%

For month of May 0.8% -3.3%

Performance + 4.1%

Top 5 Sectors Wtg

FMCG 15.5%Chemicals 11.3%Pharmaceuticals 10.8%Oil and Gas 10.4%Capital Goods 10.3%

Performance Highlights

Strategy

Stock movement

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The portfolio has outperformed the Nifty Index by 24.2

since inception, 4% for the month.

The outperformance was mainly led by stocks in FMC

sector. However the gain from stocks in FMCG sector w

partly negated by few stocks in O&G and Banking sector.

We expect market to consolidate over next one quarter on t

back of mixed flow of data from overseas market and high

inflation and interest rate regime in domestic market.Given the current market scenario, we are of the view th

Pharma and FMCG sector should continue to outperform

broader market indices whereas other sectors (other th

Banking) would have to undergo period of some more pain

consolidation.

Given the current market conditions and objective of t

fund, we feel that current composition is ideal for t

portfolio.

Given the high cash balance and volatility in the market,

would keep looking for short term investment opportunitin select few stocks.

Stocks Entered

Reliance Industries (New Added)

ONGC

Stocks E xited

Bank of Baroda (Reduced)

ONGC

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Overview

Herbicides

21%

Fungicides

19%Insecticides

58%

Others2%

Product category-wise b reakup of Indian agrochemic

industry

Sector of the month- Agrochemical Sector

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Background

India with a population of 1.17bn, growing at 10 yr CAGR of 1.5% per annum, is a large and growing market for agri food products. Per capincome in India has increased at an average of 5.4% per annum (at constant prices) during the same period. However, the production of fograins has remained stagnant with a nominal 1% growth, creating a massive gap between production and consumption of food grains. On p

capita basis, food production has dropped from 207gms to 185gms, creating trade deficit in cereals, pulses & oilseeds.Post green-revolution India has faced multiple food deficits due to uncertain monsoons and low crop yields. The country which produces 16of the global food grains production has one of the lowest crop yields in the world. India's crop yield of sugarcane, rice, wheat, pulses aoilseeds is less than half of the best of the world (as shown in the chart below). Lack of adequate knowledge and sufficient funds has hinderthe farm yield in the country. However, consistent efforts by the government and private sector have helped in reviving the growth agrochemical industry. Improvement in irrigation infrastructure has made it possible to sow multiple crops in a year in certain areas of tcountry (there by improving the agrochemical consumption). Strong initiatives in agri-education are also taken by the private sector to punew products and better farm practices in the farmer community.

Source: Indian Council for Research on International Economic Relation using FAO statistics

Agrochemical segment includes products like insecticides, fungicides, herbicides, etc. India's agrochemical usage stood at 0.6 kg/ ha, mubelow international standard. (India produces 16% of the food grains in the world but consumes only 2% of the total agrochemi

production.) Hence, considering the importance of food security we expect major investments in the buzzing space.

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Indian agrochemical industry is the fourth largest market in the world with a total estimated market size of USD 1.4bn, after the Unit

States, Japan, and China. Of this, ~50% market share is held by MNCs and the rest by Indian companies who are largely into off-pate

generic formulations.

Indian agrochem industry (USD 1.4bn in size) is expected to grow at 8-10% compared to 3.6% expected from global market (USD 43b

till 2014 (Domestic industry grew by 11% in 2009).

40 ingredients are going off-patent by 2013, which will throw up opportunities for existing established players.

Indian agrochemical market is dominated by Insecticides with 58% market share, followed by herbicides and fungicides with 21% a19% share respectively.

Nearly 50% of the total pesticide produced is consumed by only two crops i.e. paddy and cotton.

Government support for agri infrastructure, marketing alliances with global leaders and biotechnological developments would bo

sector growth going forward.

Stocks in the sector

Large Cap Tata Chemicals, Rallis India, United Phosphorus, Coromandel International

Midcap Bayer Crop Science, PI Industries, Nagarjuna Agrichem, Excel cropcare, Meghmani Organics, Insecticides India



Stock of the month

Investment Rationale

Expansion plan to drive growth & improve margins

Robust demand from the user segments

Strong network for sourcing of raw materials

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GPL has chalked out a strong expansion plan to increase its capacities and improve its integration & product mix over the next few years. Tcompany's ambitious growth targets include enhancing the recycling capacity to over 100,000 MTPA in stages over the next 3-4 years, buildup of yarn spinning capacity to integrate its operations forward, foraying into manufacturing of downstream products and horizonintegration by producing more value added products from pet bottle waste. These growth plans would help the topline and bottomline to gr

at a healthy CAGR of 35-40% over the next few years.

There is huge market for technical/ non-woven textiles in India, expected to grow at 11% p.a. from INR 371 billion currently to INR 664 bn2012. Demand for fiberfill (lightweight synthetic fiber), used as stuffing in home furnishings such as pillows, mattresses, etc and soft toremains strong; estimated market size for which is over INR 150 billion. With strong and sustainable growth of these PSF consuming aredemand for Regenerated PSF consumption is set to register double digit growth, backed by lower prices and introduction of versatile produfor increasing number of applications

The raw material sourcing network acts as a major entry barrier in the recycling industry and GPL is focused on strengthening the samCollection of post consumer pet waste is a critical factor to remain competitive and to ensure the quality of finished goods. GPL has developa unique network of more than 25 waste collection centers that run on a franchisee model and is planning to add another 20 centers over

next two years.

Ganesh Polytex Ltd

7

Annual H ighlights

?GNPL was awarded "Silver Shield" for Excellence in Financial Reporting by the Institute of Chartered Accountants of India in Janua2011. The Annual Report and Accounts for FY10 were adjudged as the second best amongst the entries received under the Catego"Manufacturing Sector -Turnover less than INR 5 billion". The award provides confidence that the accounting policies and practicadopted by the Company are among the best.

IFCI Venture Capital Funds, under its Green India Venture Fund, has provided subscribed 1.5 million Optionally ConvertibDebentures (OCDs) of INR 90 each of the company on preferential basis. These OCDs can be converted into equal number of equshares of INR 10 each of the company at a premium of INR 80 per share.

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*Prices As On 8th June.2011

Ganesh Polytex Ltd (GPL) is India's largest waste management company, engaged in recycling of pet waste. Incorporated in 1988, G

started off producing synthetic yarn at Kanpur in Uttar Pradesh. It entered the business of manufacturing Recycled Polyester Staple Fib(RPSF) from pet bottles (Poly Ethylene Terephthalate) and plastic waste in the mid nineties with a capacity of 6,000 MTPA. This was the fi

venture of its type in India and GPL today with capacity of 57,600 MTPA is the largest player in the RPSF industry across the country. T

company recycles more than 1.5 billion bottles annually to manufacture RPSF and is set to become a leading environment friendly company.

CMP: ` 64* Target: ` 1

Valuation

GPL is currently trading at FY12E P/ E multiple of 8x and EV/ Sales multiple of 0.7x, which appears attractive considering the strong growand improving margins. We have used the discounted cash flow (DCF) method to value GPL due to the strong expansion plan, the benefitswhich would accrue over a longer period. Our valuation suggests Mar'12 target price of INR 102 based on a discount rate of 17.2% anterminal growth of 2%. The target price implies a potential upside of 64% from current levels. We initiate coverage with a BUrecommendation.



Technical Markets Outlook

Economic Data

Nifty Monthly Technical Outlook

Nifty ended the month down 190 pts and closed negative at 55levels, after making a high of 5775. Technically Nifty on monthchart has formed bearish candle stick formation with long lowshadow, which indicates sideways trading range between 5355750 at 23.60% retracement at 5375 levels. On monthly cha

Nifty finds resistance around previous top of 5650-5800 asupports are placed at 5460-5350 levels. Some leading indicatlike MACD, RSI and Momentum indicators are neutral zowhereas buying pressure at support zone when it occurs, so Niwould continue till 5450-5650 levels. If Nifty breaks above 56Nifty can would take next area of resistance 5750-5800 levNifty is trading in a rising channel and heading towards support5450-5375 levels. In wide range Nifty has good supports at 54and resistance at 5750. Stochastic and the RSI are overbought bremain sideways trading possible in short-term. For short tetrading long potions, stop loss of 5350 is advisable on closbasis. If Nifty crosses 5370 levels then it can target 5075 and 48lower levels as well.Source : Iris

Technical Market Outlook

8

USA, June 2011

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June 08 - Consumer Credit, Apr, Survey $ 6 bn, Prior $ 6.01 bn

June 09 - Trade Balance, Apr, Survey -$48.5bn, Prior -$ 48.2 bn

June 09 - Wholesale Inventories, Apr, Survey 1.00%, Prior 1.10%

June 10 - Import Price Index (MoM), May, Survey -0.70%, Prior 2.20%

June 14 - Producer Price Index (MoM), May, Prior 0.80%

June 15 - Consumer Price Index (MoM) , May, Prior 0.40%

June 15 - Capacity Utilization, May, Prior 76.90%

June 15 - Industrial Production, May.

June 16 - Housing Starts MOM%, May, Prior -10.6%

June 16 - Building Permits, May, Prior 551K.

June 16 - Current Account Balance, 1Q, Prior -$113.3 bn

June 17 - Leading Indicators, May, Prior -0.30%

June 21 - Existing Home Sales MoM, May, Prior -0.80%

June 22 - House Price Index MoM, Apr, Prior -0.30%

June 22 - FOMC Rate Decision, June 22, Survey 0.25%, Prior 0.25%

June 24 - Durable Goods Orders, May, Prior -3.60%

June 24 - GDP QoQ (Annualized), 1Q T, Prior 1.80%

June 24 - GDP Price Index, 1Q T, Prior 1.90%

June 24 - Core PCE QoQ, 1Q T, Prior 1.40%

June 24 - Personal Consumption, 1Q T, Prior 2.20%

June 27 - PCE Core (MoM), May, Prior 0.20%

June 27 - Personal Spending, May, Prior 0.40%

June 27 - PCE Core (YoY), May, Prior 1.00%

June 27 - Personal Income, May, Prior 0.40%

June 28 - Consumer Confidence, Jun

June 29 - Pending Home Sales MoM, May, Prior 11.60%

India, June 2011

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June 09 - Food Articles WPI YoY, May 28,

June 09 - Fuel Power Light WPI YoY, May 28,

June 09 - Primary Articles WPI YoY, May 28,

June 10 - Industrial Production YoY, Apr, Prior 7.30%

June 14 - India Manpower Survey, 3Q, Prior 49%

June 14 - Monthly Wholesale Prices YoY%, May, 8.66%

June 16 - Food Articles WPI YoY, June 04

June 16 - Fuel Power Light WPI YoY, June 04

June 16 - Primary Articles WPI YoY, June 04









Outlook Nifty remained under pressure in the May series due to FII selling a

weak global cues with disappointing economic data coming in month. Nifty lost 6.45% from April to May series. The cash markseries opened at 5782.5, made a high at 5804.30, low at 5328.70, aclosed at 5412.35. Across all expiries, Put writing is seen at 5300-52strike prices and Call writing is seen at 5500-5600 strike pricsuggesting 5300-5600 to be the broad zone in Nifty for short terGlobal markets are also in short term bearish zone. Domestic markare likely to trade range bound based on economic and politievents. After the May correction, buying interest in Midcap and Smcap sectors is possible. Sugar, Pharma, Fertilizer, Agri-commodsector stocks can be accumulated in the June series.

Derivative Market Outlook

9

0

0.5

1

1.5

2

2.5

3

3.5

4

0

0.05

0.1

0.15

0.2

0.25

0.3

0.35

0.4

0.45

A u t o

B a n k

C a p i t a l G o o d s

C e m e n t

C h e m & F e r t

H o t e l

I n f r a I T

L o g i s t i c s

M e d i a

M e t a l & M i n i n g

M i s c

O i l & G a s

P h a r m a

P o w e r

R e a l t y

S u g a r

T e l e c o m

T e x t i l e s

0

2000000

4000000

6000000

8000000

10000000

12000000

14000000

16000000

18000000

20000000

5 0 0 0

5 1 0 0

5 2 0 0

5 3 0 0

5 4 0 0

5 5 0 0

5 6 0 0

5 7 0 0

5 8 0 0

5 9 0 0

6 0 0 0

6 1 0 0

6 2 0 0

6 3 0 0

Index Future Analysis

Change in OI

Index Option Analysis

Sector Wise Roll Over And Volume Change

Change inPrice - Future

Top Five Gainers- Price

Nifty 5785.45 5412.35 -6.45%

VIX 20.92% 19.18% -8.32%

PCR 0.79 0.97 22.78%

26th-May Chan ge28th-Apr

Market Statistics

-600000

-200000

200000

600000

1000000

1400000

1800000

2200000

2600000

C N X I T

B A N K N I F T Y

M I N I N I F T Y

N I F T Y M C A P 5 0

N I F T Y

C h a n g e i n O I a n d

V o l u m e

Change in OI Change in Volume

Roll Over Change in GDQ

Lowest Roll Over

PFC 41.69% Banking

CROMPGREAV 42.76% CG

MAX 44.89% Misc

GLAXO 51.85% Pharma

COREPROTEC 54.77% IT

Roll Over Sector

H ighest Roll Over

VIDEOIND 96.91% Misc

GTLINFRA 96.90% TelecomMCLEODRUSS 96.53% FMCG

GTL 96.42% Telecom

RUCHISOYA 95.32% FMCG

Roll Over SectorTop Five Losers- Price

Change inPrice - Future

ONMOBILE -63.33%SREINFRA -30.83%

PATNI -25.79%

JINDALSAW -25.77%

BALRAMCHIN -24.73%

ASIANPAINT 11.34%

DABUR 11.12%

RANBAXY 10.99%

HINDUNILVR 9.96%

HEROHONDA 9.95%

Index

O p e n I n t e r e s t

Strike

CE PE

(10,000,000)

(8,000,000)

(6,000,000)

(4,000,000)

(2,000,000)

-

2,000,000

4,000,000

6,000,000

8,000,000

10,000,00012,000,000

14,000,000

16,000,000

5 0 0 0

5 1 0

0

5 2 0 0

5 3 0 0

5 4 0

0

5 5 0 0

5 6 0 0

5 7 0

0

5 8 0 0

5 9 0 0

6 0 0

0

6 1 0 0

6 2 0 0

6 3 0

0

Strike

O p e n I n t e r e s t

CE PE



Source: Accord Fin tech for All MF Data

Pick of the month

H DFC Mid - Cap Opportunities Fund

H DFC Top 200 Fund

HDFC Mid - Cap Opportunities Fund is an open end equityMid Cap scheme, the aim of the fund is to generate long-term

capital appreciation from a portfolio that is substantially

constituted of equity and equity related securities of small and

mid-cap companies. The last 1 year return stands at 17.95%

(Absolute) and 12.42% (CAGR).Since inception. Major

investments of nearly 15.53% are in Pharmaceuticals & Drug

and 10.46% in Auto Ancillary.

HDFC Top 200 Fund is open end equity Large cap Scheme,

generate long term capital appreciation from a portfolio of equ

and equity linked instruments. The investment portfolio for equ

and equity linked instruments will be primarily drawn from t

companies in the BSE 200 Index. The last 1 year return stands

14.07% (Absolute) and 22.90% (CAGR).Since inception. Ma

investments of nearly 12.97% are in Bank - Public and 10.24%

IT – Software.

Mutual Fund round up

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NAV01-June-2011

Return(%)

Scheme Nam e

HSBC Small Cap(G) 10.56 -7.34

HSBC Midcap Equity(G) 19.43 -6.07

India Advantage Fund 214.20 -5.06

Baroda Pioneer PSU Equity(G) 8.53 -4.28

HSBC Progressive Themes(G) 11.4 -3.90

Top Laggards : Equity Diversified Category

NAV01-June-2011

Return(%)

Scheme Nam e

Mirae Asset Emerging BlueChip-Reg(G) 11.33 3.09

Mirae Asset India-China Consumption(G) 10.46 2.26

HDFC Mid-Cap Oppor(G) 15.87 1.79Edelweiss Absolute Return(G) 11.39 1.69

Franklin India Prima(G) 273.69 1.60

Top Movers : E quity Diversified Category

Top Performer across category

NAV01-June-2011

Return(%)

Scheme N ame

Tata FIPF C3-Reg(G) 13.05 5.35

Franklin FMCG(G) 71.21 4.28

Mirae Asset Emerging BlueChip-Reg(G) 11.33 3.09

Reliance Pharma(G) 57.11 2.87

JPMorgan JF Gr China Eq Off-Shore(G) 12.65 2.51

-30

-20

-10

0

10

20

30

2 - M a y

3 - M a y

4 - M a y

5 - M a y

6 - M a y

7 - M a y

8 - M a y

9 - M a y

1 0 - M a y

1 1 - M a y

1 2 - M a y

1 3 - M a y

1 4 - M a y

1 5 - M a y

1 6 - M a y

1 7 - M a y

1 8 - M a y

1 9 - M a y

2 0 - M a y

2 1 - M a y

2 2 - M a y

2 3 - M a y

2 4 - M a y

2 5 - M a y

2 6 - M a y

2 7 - M a y

2 8 - M a y

2 9 - M a y

3 0 M a y B

i l l i o n s

MF Activity

Equity Debt

5100

5200

5300

5400

5500

5600

5700

5800

-4000.0000

-3000.0000

-2000.0000

-1000.0000

0.0000

1000.0000

2000.0000

2 - M a y

3 - M a y

4 - M a y

5 - M a y

6 - M a y

7 - M a y

8 - M a y

9 - M a y

1 0 - M a y

1 1 - M a y

1 2 - M a y

1 3 - M a y

1 4 - M a y

1 5 - M a y

1 6 - M a y

1 7 - M a y

1 8 - M a y

1 9 - M a y

2 0 - M a y

2 1 - M a y

2 2 - M a y

2 3 - M a y

2 4 - M a y

2 5 - M a y

2 6 - M a y

2 7 - M a y

2 8 - M a y

2 9 - M a y

3 0 - M a y

3 1 - M a y

NIFTYFIIs in Cr

Nifty Vs FII Equity inflows



Insurance

1

Kotak Assured Income Plan

Policy Terms?Upto Age - 30 yrs

Entry Age

Minimum Maximum

Entry Age 0 yrs 60 yrsMaturity Age 30 yrs 90 yrs

ObjectiveKotak Assured Income Plan guarantees you an additional incomeevery year, for 20 years and you also enjoy life cover for entire policyterm there by protecting your family should something happen toyou.

Benefits

Tax BenefitYou can avail of tax benefits under Section 80C and Section 10(10D) of Income Tax Act, 1961. Tax benefits are subject to changein the tax laws.

Death BenefitOn death of the Life Insured, the nominee receives Basic SumAssured ensuring adequate protection for the family. The AssuredAnnual Income will cease on death.

Maturity Benefit

Surrender Benefit

Fund Access – Loan

Sum Assured

Premium

Minimum Premium

Premium Payment

Premium Modal Factor

In addition to guaranteeing you regular income for 20 years, thplan provides you with a lump sum of 110% to 104% of the Ba

Sum Assured, depending on age. Maturity Benefit is a percentaof the Basic Sum Assured and is calculated as {110% - 0.1 % x Aat Entry}, i.e. 107% at Age at Entry of 30.

On completion of three policy years, the policy acquiresGuaranteed Surrender Value provided all due premiums have bepaid on time.

On completion of three policy years, the policy acquiresGuaranteed Surrender Value provided all due premiums have bepaid on time.

` 10, 000 p.a

Annual, Half-yearly, Quarterly or Monthly.

Yearly – 100%, Half yearly - 51%, Quarterly – 26%, Monthly – 8.8

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Enjoy Assured Annual Income for 20 years

Receive lump sum on maturity

Provide protection to your family for 30 years

Avail of policy loan to meet sudden expenses

Boost your protective cover through optional rider benefits

Key Features

Age of Customer (yrs) Basic Sum Assured ( )

25 ` 2,00,000

35 ` 5,00,000

45 ` 7,50,000

`



Domestic fixed income markets continued to remain under

pressure on the back of rate increase prescribing RBI monetary

policy and macro economic numbers, which continue to remain

detrimental for bonds.

Constant supply and higher than expected issuance of short term

instruments by the Reserve Bank of India (RBI) in order to meet

the government cash balances has fuelled further bearishness in themarkets. The Wholesale Price Index (WPI) for the month of April

2011 stood at 8.66%, marginally higher than market expectations

of 8.50%.

Most economists expect the central bank to raise its main policy

interest rate by 25 basis points at its review on June 16, after it raised

its key rates by a bigger-than-expected 50 basis points early this

month. India's 10-year benchmark bond yield fell 2 basis points to

8.37pc immediately after the data, which was seen to ease pressure

on the central bank to tighten rates aggressively.

Liquidity in the system is likely to tighten further in mid-June when

advance tax of Rs 45000 cr is expected to go out of the system. Gilt

prices ended higher on Wednesday due to short-covering and on

view that the government may trim its fiscal year market borrowing

program.

We expect the domestic bond market yields to remain high and

continue to remain under upward pressure (negative for bond

prices) as macro economic numbers and expected continuity of

supply of gilts across the tenor would quell appetite for duration

assets.

Bond Market Outlook

12

Currency Market OutlookThe Indian rupee erased its April gains and ended weaker in previous month against the dollar. The partially convertible ruplost 1.83 % against the dollar weighed by weaker Euro and dollar demand from importers. The euro eased in the month May pulling away from a key chart resistance as uncertainty ovhow Greece's debt crisis will be tackled kept investors on edgwhile the dollar strengthened .The ICE dollar Index gained mo

than 2.30% whereas the euro fell more than 2.70% against tdollar on monthly basis. There is a bit of tug-of-war going between the euro and the dollar as the worries about the risk odebt restructuring by Greece cast a cloud over the euro, a recerun of weak U.S. economic data and a drop in U.S. Treasury yiewere weighing on the dollar. Data in the U.S. is showing growthlosing momentum and that has supported speculation of anothround of quantitative easing. For the dollar to turn around thehas to be a change in interest rate expectations in the U.S. Thaunlikely in the near term. A report that China is interested buying EU bailout bonds for Portugal also supported the euro.

Oil prices are likely to stay firm and monsoon will be crucial for t

rupee since it will have a bearing on inflation. Growth trajectocould be questioned as inflation remains high. This in turn will pthe outlook on capital flows under a cloud. Crude oil is Indibiggest import item and a sharp price swing impacts inflation anin turn, the country's growth. India's economy grew at its slowannual pace in five quarters in January to March, as rising interrates crimped consumption and investment, which could tempthe pace of central bank tightening to tackle inflation. Indicentral bank has stepped up its fight against stubbornly hiinflation by raising interest rates by a bigger-than-expected basis points on May 3rd and vowed to battle price pressures eventhe cost of some economic growth.

Despite the slowing economy, the Reserve Bank of India is widexpected to raise key rates by 25 basis points on June 16. AlthougIndia's annual monsoon rains arrived few days before schedulesome parts the picture for the rupee will be clear only by the end July. Normal monsoon rains will lead to a good harvest that shouease high food prices and boost the purchasing power of the 6million Indians dependent on agriculture. Going forward, trupee trajectory would also take cues emerging from the polstance of the ECB (European Central Bank) and the Fed (UFederal Reserve) amid developments in the euro sovereign spaTechnically we expect rupee to test 44 levels against the dollar un45.20 holds on monthly basis.



Real Estate Opportunities

Nirmal Lifestyle (Mumbai)

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About Lifestyle

Lifestyle is going to latest venture into

townships .It is inspired out of relentless

search and discovery of excellence in regional

development. It is the expertise that they wish

to replicate across 20 destinations in the

country, after small contribution in uplift and

development of Mulund into a preferred

suburb in Mumbai today. Each lifestyle city

would bring world-class infrastructure and

facilities within reach. Lifestyle city will vary

from 100 to 1000 acres that would house most

prudent facilities with superior infrastructure

in the country. The city would createconsortium of conveniences that aspire to

harness multi-specialty talent for every

individual living in it. These initiatives aim at

breeding adequate and superior sports

infrastructure and facilities which would be

adopted as part of living and lifestyle. Lifestyle

City will inspire & expose universal living &

global lifestyles through its assortment of

innovative initiatives to redefine living.

The first Lifestyle city is exposed to Kalyan to contribute its developmental excellence to the region and create a pull for people from with

Mumbai and allied region to shift and start living in globally benchmarked planned city. The city is enveloped with river on the two sides thadd to its naturally eloquent landscape. Along-with other facilities the city will house and present country's first US Open club-house an

academies, which will contribute to the company's vision of creating superior and branded sports infrastructure across the country.

Nirmal Lifestyle, a leading property developer is identified as the front ranking property development companies in Mumbai. Having bu

more than 50 lac sq. ft. residential and commercial complexes, the group is a name to reckon with the real estate markets in Mumbai. Whi

building and construction has been the core activity for the company, quality and innovation has by far been the soul for all its projects.

Today, Nirmal Lifestyle has become synonyms to Mulund with its vision and unprecedented approach towards the city.

The company is headed byMr. Dharmesh S. Jain, he was appointed as Managing Committee of Maharastra Chamber of Housing Indust

Considering his expertise and passion for the industry the Govt. of Maharastra appointed him as a Director on the Maharastra Police Housi

& Welfare Corp.

He was also presented with the “Jain Ratna award” for his social accomplishments. He is also committed to social work and patrons of tw

charitable hospitals under the flagship of care Foundation. He is also the Managing Trustee of Care Foundation and Rotarat Charitable tru

Social contribution of the organization continues to tell many more committed stories.



Real Estate Opportunities

N im bus T he Golden Palm located (N oida Sector 168)

14

Overview

About Nimbus Group

IITL Nimbus Group new residential project Golden Palm coming

up in Sec-168, This is starting from 1 BHK-Studio apartments to 4

BHK Apartments Sizes ranging from 525 Sq.ft to 2423 Sq.ft with

best amenities and facilities.

Nimbus The Golden Palm located in the heart of Noida in Sector

168, bang on the main Noida Expressway. IITL Nimbus The

Golden Palm Noida Expressway is just 10 minutes drive from DND

flyover and Secto-18 Atta Market. It is 5 min. drive from Amity

University and Botanical Garden. It faces proposed metro station.

Nimbus The Golden Palm would provide uninterrupted drinking

water supply treated with RO system. Storm water drainage system

by designing and executing efficient S.W. drains and culvertsincluding rain water harvesting for ecological balance.

Nimbus India Limited was originally incorporated as Nimbus Securities Limited vide Certificate of Incorporation dated December 14, 19

with the Registrar of Companies, NCT of Delhi and Haryana at New Delhi the name was changed to Nimbus (India) Limited vide fre

Certificate of Incorporation dated March 1st,1999. The Company is registered with RBI as a NBFC Company. Presently, the Company h

mainly engaged in investment activity. The company under the able guidance and leadership of its Managing Director, Mr. Bipin Agarwal, h

handled all the advisory, consulting and syndication services for corporate. As a corporate financial advisor it has advised his clients on capi

/ financial restructuring, valuations, business models and project financing.

Type Size (sq. ft.) Booking Amount (` ) Floor PlansStudio Apartments 506 sq.ft. N.A. View Plans2BR-2T-Study Room 1085 sq.ft. N.A. View Plans3BR-3T 1554 sq.ft. N.A. View Plans3BR-4T-Study Room 1914 sq.ft. N.A. View Plans4BR-5T-1Servant Room 2473 sq.ft. N.A. View Plans

Available Plans





Alternate Investment Idea

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Omnivore Capital, an Rs 250 Cr dedicated investment fund launched in October 2010, focuses on early stage agribusiness and ru

enterprises in India. From its offices in Mumbai, Omnivore acts as the lead investor in private Indian companies operating in agriculture. T

Fund will only make non-controlling, minority investments in venture and early stage private enterprises. The investment team looks

businesses that have innovative technologies or business models, and where the Fund's investment capital, network and expertise can

applied to scale a business.

Godrej, one of India's oldest and most trusted business conglomerates, is the Strategic Advisor to Om nivore Capital. The Fun

have strategic relationship with Godrej Agrovet can also be leveraged to support portfolio companies. Godrej Agrovet has a wide network

rural dealers and distributors across India which portfolio companies can be connected with to accelerate market access and chan

development. Likewise, Godrej Agrovet's knowledge of government relations can be utilized by portfolio companies to help secu

grants/ subsidies for relevant products and manage the regulatory environment. Finally, on an as needed basis, portfolio companies can rece

ongoing technical and strategic guidance, benefiting from Godrej Agrovet's Four decades of experience in Indian agribusiness.

Omnivore Capital believes growing global demand for agricultural commodities and food products with constrained supplies, process

capacities, and distribution channels provide an attractive investment opportunity.

The demand for agricultural products is growing as a result of two prominent phenomena: a global population increase, and ris

incomes which result in changing diets

In recent years, growing world demand for agricultural crops has outpaced production, resulting in a tightening of stocks a

upward pressure on prices.

Agricultural prices are at all-time highs, and we expect even higher real prices and above-average investment returns.

During times of economic contraction, the demand for food historically has not declined as significantly as other products and service

We believe the circumstances of the current global recession - including tight credit and reduced asset values - have created a particula

attractive entry point for investors in the agriculture industry.

In particular, the prospects for fertilizer, seed, machinery/ equipment, and irrigation companies appear especially compelling.

Fund size:` 250 crore

10 deals, ` 25 crore average investment per companyReserve 60% of fund for follow-on investments

No focus sector greater than 20% of portfolio

Will not take controlling stake in startups

Target equity ownership at investment: +26%

Target equity ownership at exit: +15%

Syndicate deals with like-minded investors

Board seat in every investment

Active involvement with company management

WHY AGRITECH?

INVESTMENT STRATEGY: DEAL STRUCTURE

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Fund: Omnivore Capital I

Target Fund Raise: ` 250 crore

Minimum Investment 25 Lacs

Investment Period: 4 Years

Fund Life: 8 Years

Management Fee: 2.0% per annum

Performance Fee: 20% carry

Preferred Return: 8.0% IRR

Legal Counsel: Nishith Desai Associates

Auditor: KPMG

FUND TERMS





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Pathfinder June 2011

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