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Diversification + Appreciation + Tax Free Income

Amar Shah, Head - Retail Business, ICICI Prudential AMC

28th October 2017

In a nutshell

ICICI Prudential's Multi-Manager Classic Dividend Plan is tailored for investors who want it all: diversification + appreciation + tax free income. Diversification across equity categories and styles is achieved through 3 pre-selected plans of 4 funds each that investors can choose from. The funds pay out annual dividends, but in different quarters, thus enabling investors to receive quarterly dividends from their chosen basket of funds. And convenience of investing in SIPs through a single cheque across the basket makes the proposition operationally simple. Amar takes us through the construct of the 3 different plans under these "all-in-one" solutions from ICICI Prudential.

WF: What is the genesis of the idea of creating three bouquets of equity schemes under your Multi-Manager Classic Dividend Plan?

Amar: Investors in general have a requirement of diversification, capital appreciation andtax free income. And for the nuanced investor, he/she may even look at mechanisms which undertake profit booking at regular intervals such that one's recommended asset allocation stays intact. By its very construct, Multi-Manager Classic Dividend Plan (MMCDP) provides asset allocation, diversification across categories coupled thereby mitigating concentration, all leading to wealth creation. With this feature, the investor can also gain periodic income through dividends.

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Diversification of Portfolio

As can be seen form the presentation below, by investing in Multi-Manager Classic Dividend Plan one gets instant access to category and investment style diversification.

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There are three plans available under this feature, namely Plan A, Plan B and Plan C.

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Disclaimer: The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors. Dividend is subject to distributable surplus and approval of trustees; IPRU - ICICI Prudential

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Disclaimer: The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors. Dividend is subject to distributable surplus and approval of trustees; IPRU - ICICI Prudential

Benefits of investing via this feature:

  1. Diversified Across Scheme Category

  2. Diversified Across Investment Style

  3. Mitigation of Concentration Risk

  4. Dividend Income from Respective Schemes

  5. Dividend transfer plan to any open-ended scheme

WF: How did you arrive at the specific combinations of Schemes within Plans A, B and C?

Amar: The combination of Schemes for various Plans available has been made keeping in mind the diversification a portfolio requires and the risk profile of the investors. For example: Plan C is for an aggressive investor wherein there is diversity in the type of investment but is largely thematic in nature.

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WF: In what way is transacting facilitated under these bouquets of Schemes?

Amar: One can invest either by SIP or lumpsum.

Lump Sum

Application amount for Lump Sum investment - Rs.1,00,000/- and in multiples of Rs.4/-thereof.

SIP

Monthly Frequency: Rs. 10,000/- and in multiples of Rs.4/- thereof (Minimum number of instalments: 6)

Quarterly Frequency: Rs. 30,000/- and in multiples of Rs. 4/- thereof (Minimum number of instalments: 4)

WF: Can you take us through the Dividend Transfer Plan facility?

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Amar: Dividend Transfer Plan facility is such that the dividend obtained by investing in Multi-Manager Classic Dividend Plancan be transferred to any other open ended schemes.For example, dividend from IPRU Focused Bluechip Equity Fund under MMCDP - Plan A cannot be triggered to any of the scheme in Plan -A, but can be transferred to any other open ended schemes. So, one can choose to transfer the dividends into a debt or open ended equity scheme based on one's financial requirements.

On the functional aspect, one's investment is divided equally between four schemes and all four schemes offer dividend once a year, but in separate quarters. Hence, you may receive dividends four times a year.

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WF: In the SIP route, do investors have an option to change the allocations to specific Schemes - for example, increasing the SIP allocation to BAF when valuations turn very rich?

Amar: The allocation will remain fixed and cannot be changed. Given below are the Sip returns of each of the Plans for the past 1, 3, 5, and 10 years.

SIP Returns - Multi Manager Classic Dividend Plan - Plan A

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Source: ICRON Research. Returns in CAGR (%) terms. CAGR: Compounded Annual Growth Rate. Past performance may or may not be sustained in future. The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors, Data as on September 18, 2017, Inception date for ICICI Prudential Focused Bluechip Equity Fund and ICICI Prudential Dividend Yield Equity Fund is 23-May-2008 and 16-May-2014 respectively.

SIP Returns - Multi Manager Classic Dividend Plan - Plan B

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Source: ICRON Research. Returns in CAGR (%) terms. CAGR: Compounded Annual Growth Rate. Past performance may or may not be sustained in future. The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors., Data as on September 18, 2017, Inception date of ICICI Prudential Select Large Cap Fund is 28-May-2009

SIP Returns - Multi Manager Classic Dividend Plan - Plan C

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Source: ICRON Research. Returns in CAGR (%) terms. CAGR: Compounded Annual Growth Rate. Past performance may or may not be sustained in future. The information contained herein is solely for private circulation for reading/understanding of registered Advisors/ Distributors and should not be circulated to investors/prospective investors., Data as on September 18, 2017, Inception date of ICICI Prudential Banking & Financial Services Fund is 22-August-2008

WF: What will you suggest to distributors as the ideal target client base for this proposition and how should this be pitched?

Amar: This feature is ideal for investors who wish to take equity exposure and have dividends by way of regular cash flow.

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Please read the terms and conditions applicable to MMCDP

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

The information contained in this communication is only for the reading/understanding of the registered Advisors/Distributors. All data/information used in the preparation of this communication is specific to a time and may or may not be relevant in future post issuance of this communication. ICICI Prudential Asset Management Company Limited (the AMC) takes no responsibility of updating any data/information in this communication from time to time. The AMC (including its affiliates), ICICI Prudential Mutual Fund (the Fund), ICICI Prudential Trust Limited (the Trust) and any of its officers, directors, personnel and employees, shall not liable for any loss, damage of any nature, including but not limited to direct, indirect, punitive, special, exemplary, consequential, as also any loss of profit in any way arising from the use of this communication in any manner.

Nothing contained in this communication shall be construed to be an investment advice or an assurance of the benefits of investing in the any of the Schemes of the Fund. Recipient alone shall be fully responsible for any decision taken on the basis of this document.



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