Aditya Birla Select Sector Portfolio

The investment objective of the portfolio is to generate long-term capital appreciation and reasonable income in the form of dividends by investing in equity and equity related securities. Invest in High Quality businesses in Sectors with consistent Growth and ROE by identifying and participating in growth of these businesses over medium to long term as also practice Value Investing while making investment decisions.

• Focus on sectors with strong operating dynamics and growth visibility – target 80% of the portfolio to be invested in 4-6 sectors.

• Seek to co-own High quality businesses with consistent Growth and ROE profile across the identified sectors

• Stock selection and industry allocation independent of benchmark weights

• Use a value investing approach to focus on higher longer term returns

• Build a focused portfolio of ~15-25 high quality companies

• A cap of 10% on individual stock at cost

• Derivatives exposures in the portfolio will be in line with SEBI guidelines and will be taken only for hedging purposes.

We firmly believe that bottom-up, fundamental research offers the best way to identify high-quality companies with above-average, sustainable earnings growth.

• Fundamental Research:

The portfolio construction process begins with fundamental analysis performed by equity analyst(s), which provides the portfolio management team with company and industry research. Investment ideas are also developed by analysing company and industry information from meetings with the company managements, suppliers, users, competitors, industry consultants and broker research community.

• Research Process:

The equity research process typically begins with an industry/sector overview to identify industry trends and provide a framework for individual security selection. Fundamental analysis at this level usually involves analysis of unit growth prospects, pricing power, international growth opportunities, the regulatory environment, and economic sensitivity. Analyst(s) develop a robust knowledge of the economic, political and international situations that affect the industries under study.