The NFO of August and September 2021.

Baroda Asset Management India Limited has launched it NFO. Baroda Asset Management India Limited (“AMC”), investment manager to Baroda Mutual Fund (“Mutual Fund”), is a wholly owned subsidiary of Bank of Baroda and is positioned to serve the varied asset management needs of investors in India through a range of equity, debt and money market offerings.  With a focus on enhancing the overall customer experience, the AMC is working towards:  Enhancing the existing product range to include products that will provide investors with a much wider choice suited to their diverse needs and risk profiles Providing consistent investment performance through sound investment management  Creating an increasing number of access points for investors through the vast branch network of Bank of Baroda Objective of the NFO The fund’s primary objective is to generate long-term capital appreciation by predominantly investing in equities with a focus on riding business cycles. To achieve this, they aim at dynamic asset allocation between stocks and sectors at different stages of the business cycle in the economy. However, the scheme doesn’t assure that the primary objective will be realized. Details of NFO Baroda Business Cycle Fund Details NFO Opening Date 24th August 2021 NFO Closing Date 06th September 2021 Re-Open Date Five business days from the date of allotment Type of Fund Open-ended equity scheme, Sectoral/Thematic Minimum Investment Amount INR 5,000 Minimum Additional Purchase Amount INR 1,000 Exit Load 0 -1% Suitability Very High Benchmark BSE 500 TRI Plans and Options Regular Plan & Direct Plan Fund Manager Sanjay Chawla (Chief Investment Officer) Abul Fateh (Sr. Equity Analyst) Pratish Krishnan (Dedicated fund manager for overseas investments) Investment Strategy The investment strategy of the Scheme is as follows: The Scheme will be a diversified equity fund which will invest predominantly in equity and equity related securities of companies domiciled in India or overseas. It will invest predominantly in equity and equity related securities with focus on riding business cycles through dynamic allocation between various sectors and stocks at different stages of business cycles in the economy. Business cycles in an economy are typically characterized by the fluctuations in economic activity measured by various Macro economic factors including but not limited GDP growth, Fiscal deficit, IIP, interest rates, inflation and other macroeconomic variables. A business cycle is basically defined in terms of periods of expansion and contraction. During expansion, an economy experiences an increase in economic activity as evidenced by real GDP growth, industrial production, etc whereas during contraction, the pace of economic activity slows down. The business cycle can be effectively used to position one‘s investment portfolio. The business cycle can be a critical determinant of equity sector performance over the intermediate term and the relative performance of equity market sectors typically tends to rotate as the overall economy shifts from one stage of the business cycle to the next, with different sectors assuming performance leadership in different economic phases. The Scheme would aim to deploy the business cycle approach to investing by identifying such economic trends and investing in the sectors and stocks that are likely to outperform at any given stage of business cycle in the economy. At each stage of Economy/Business cycle, different sectors tend to outperform in terms of business performance leading to superior returns on the bourses. The Endeavour of the Investment managers is to identify the stage of the economy/business cycle and invest in sectors/stocks which are likely to benefit from the same. Thus, it would combine Top-down view with bottom-up stock selection. The core investment philosophy of GARP (Growth at Reasonable Price) would be followed for stock selection. Investment Strategy following Business cycle approach: The key investment thesis in Business cycle Investment strategy is that Broad Macro Economic Factors determine the business cycle and that can be a critical determinant of equity sector performance over the intermediate term. Macro-Economic conditions and the Fiscal/Monetary Policy response by the Government/Central Banks, during an on-going Business Cycle may impact Business Cycle on the basis of conditions prevailing at the time. Such distortions often provide appropriate opportunities. The business cycle has the following different phases: Expansion: Strong demand, Capacity utilization above normal, Output growth strong, corporate profitability very strong, Strong tax revenues, Risk aversion very low Recession: Demand growth starts to slow down, Capacity utilization starts to fall, Output growth starts trending lower, tax revenues moderating, and risk aversion starts to increase. Slump: Demand growth below normal, Capacity utilization much below normal, Risk aversion very high Recovery: Demand growth starts to pick up, credit growth starts to improve, Tax revenues start to pick up