We believe that the divergence between Value and Growth stocks continues to prevail, & that volatility is a factor which is inherent in equity as an asset class.

1. March 2020
Global Markets Jan-20
(%)
Current
PE
10 Yr
Average
US (10.1) 18.0 15.7
UK (9.7) 19.0 17.5
Japan (8.9) 18.8 19.9
Hong Kong (0.7) 11.0 10.9
Singapore (4.5) 11.1 12.2
China 0.6 8.4 8.6
Domestic Markets Jan - 20
(%)
Current
PE
10 Yr
Average
S&P BSE Sensex (6.0) 23.8 20.1
NSE Nifty (6.4) 22.2 20.3
S&P BSE Auto (14.3) 24.5 18.6
S&P BSE Bankex (5.3) 28.7 17.3
S&P BSE Capital Goods (11.8) 22.8 28.6
S&P BSE Consumer
Durables 0.0 46.2 30.4
S&P BSE FMCG (5.8) 30.5 39.2
S&P BSE Healthcare (3.4) 29.5 28.4
S&P BSE IT (5.6) 19.1 19.7
S&P BSE Metals (13.2) 7.9 12.3
S&P BSE Mid Cap (5.6) 29.3 23.8
S&P BSE Oil & Gas (9.4) 9.5 12.1
S&P BSE PSU (10.5) 10.4 13.3
S&P BSE Realty (15.9) 27.8 24.1
US Economy: US economy grew by 2.1% in the fourth quarter of
2019. The economy grew 2.3% - slowest annual growth in three
years.
Eurozone: Eurozone’s gross domestic product (GDP) growth
slowed to 0.1% in the fourth quarter of 2019 compared with 0.3%
expansion in the July to September quarter.
UK: The UK economy expanded 1.1% annually in the fourth quarter
of 2019 compared with 1.2% in the third quarter amid political
uncertainty over Brexit and a snap general election.
Japan: Japan’s economic shrank at the fastest pace in almost six
years in the December 2019 quarter, as a sales tax hike and a soft
global demand affected consumption and capital expenditure. The
country’s GDP fell an annualised 6.3% in the October to December
period, compared with a revised 0.5% gain in July to September.
China: The People’s Bank of China injected 1.2 trillion yuan ($173.81
billion) into money markets through reverse bond repurchase
agreements to reduce the economic shock from a coronavirus
outbreak that has severely disrupted business activity. The central
bank also reduced the interest rate on 200 billion yuan ($28.65
billion)-worth of one-year medium-term lending facility loans to
financial institutions by 10 basis points to 3.15% from 3.25%. It
slashed the one-year loan prime rate to 4.05% from 4.15% as well,
and the five-year rate to 4.75% from 4.80%.
Index Performance: Indian equity indices continued the
downtrend for the second consecutive month in February 2020.
The S&P BSE Sensex and Nifty 50 plunged 6% each, tracking
global selloff amid rising concerns over spread of the
coronavirus epidemic outside China.
Inflation: Retail inflation, based on Consumer Price Index (CPI),
surged to a 68-month high of 7.59% in January 2020, up from
7.35% in December 2019. This was the second consecutive
month retail inflation breached the upper limit of the RBI’s 2-6%
inflation target band, and the sixth straight month it rose.
Domestic Developments:
Tailwinds: The government’s approval of Rs 44.60 billion for
dairy farming and changes to the crop insurance scheme too
augured well for the market. Strong inflows from domestic
institutional investors and foreign institutional investors also
boosted sentiments.
Headwinds:
 Market started the month on a disappointing note after the
Union Budget 2020-21 announcements failed to meet investor
expectations.
 More losses followed after the Supreme Court ordered
telecom players to clear dues by March 17, 2020.
EQUITY UPDATE
Data Source: Crisil Research; * Data till Feb 29, 2020;
Data Source: Crisil Research; * Data till Feb 29, 2020, PE- Price to
Earnings
Indian Market Update
Global Market Update

2. Indian Market Update
Earnings Growth
(%)
FY19 FY20E FY21E
Sensex 20.9 23.8 18.8
Macro Indicators Latest
Update
Previous
Update
GDP (YoY%) 4.7%
(3QFY20)
4.5%
(2QFY20)
IIP (YoY%) -0.3% (Dec) 1.8% (Nov)
Crude ($ bbl) 50.52 (Feb 28) 58.16 (Jan 31)
Core Sector Growth
(YoY%)
2.2
(Jan 2020)
1.3
(Dec 2019)
Trade Deficit ($ mn) -15,170
(Jan 2020)
-11,250
(Dec 2019)
Current Account
Deficit ($ bn)
-6.3
(2QFY20)
-14.3
(1QFY20)
FII Holding in Indian
Equities (%)#
22.2
(3QFY20)
22.0
(2QFY20)
Flows Feb - 20 Jan - 20 Dec -19
FIIs (Net Purchases
/ Sales) (Rs cr)
1,820 12,123 7,338
MFs (Net Purchases
/ Sales) (Rs cr)
4,739 1,384 2,746
Note: # FII hldg includes ADR/GDR (BSE500 Index); Data Source: Crisil Research; * Data till Feb 29, 2020; CAD: Current Account Deficit; GDP: Gross
Domestic Product, IIP: India Industrial Production FII: Foreign Institutional Investors; MF-Mutual Fund; E- Estimate
Outlook & Triggers
Taking cues from Global Markets, the Indian Equity Markets (Nifty 50 Index) ended the month on a negative note (-6.4%). Increasing
concerns of COVID-19 and its impact on global growth led to the fall in equity markets globally. A sharp sell-off was witnessed in the last
few days of the month when The World Health Organization (WHO) acknowledged and assessed the risk from COVID-19 to very high
from high.(Source: WHO website) The coronavirus scare led to weaker exports and imports setting a negative tone for Indian Markets.
On the domestic front, there were a series of data releases. India’s Q3 FY20 GDP data came in at 4.7% YoY above consensus estimates
of 4.5%. GDP estimate for FY20E was maintained at 5% by the NSO. CPI inflation rose to 7.6% in January from 7.4% in December on the
back of high food inflation. IIP contracted to -0.3% in December from 1.8% in November. Composite PMI data increased to 56.3 from
53.7 in December led by improvement in both manufacturing and services PMI.
Sectors like telecom and consumer staples did well while auto and realty underperformed. (Source: NSE)
We believe that the divergence between Value and Growth stocks continues to prevail with select Megacaps in the bubble zone and
Value stocks trading at attractive valuations. Such diverging trends, historically too, have provided good investment opportunities for
long term wealth creation. Few examples of such diverging trends include IT sector in 2000, Infra/Realty sector in 2007 and
Small/Midcaps at the end of 2017. In current markets we believe Value theme provides one such opportunity where few fundamentally
sound value stocks are available at inexpensive valuations, provide good dividend yield and have better earnings visibility. Hence, we
recommend investors to take exposure in schemes with value bias.
Having said that, we believe, volatility is a factor which is inherent in equity as an asset class and the recent developments around
coronavirus highlights this point clearly. Factors such as volatility and the impact of global, domestic, sectoral or company specific
events on equities have to be kept in mind while investing in this asset class. Hence, a higher risk premium required for equity
investments. As an investor, one must embrace volatility and be cognizant of their own asset allocation while investing.
We continue to recommend Dynamic Asset Allocation schemes which aim to benefit from volatility by reducing the overall cyclicality of
the portfolio. For investors who aim to benefit from divergence between growth and value stocks, we recommend investing in Value and
Special Situation schemes. Small, midcaps and value oriented stocks over the next few years is recommended for lumpsum investment
for patient long term investors
*The sector(s)/stock(s) mentioned in this communication do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may not have any future position in these sector(s)
 Lacklustre corporate earnings, selling in some index
heavyweights and volatility amid the expiry of February
futures and options contract also weighed on the indices.
Global Developments:
Tailwinds: Gains were seen following a decline in global crude oil
prices and intermittent gains in global equities markets, amid
China's efforts to cushion the financial blow of the recent virus
outbreak and the Federal chief’s optimistic view on the United
States economy.
Headwinds: Sentiments were jittery, in line with global equities
on persistent worries over the impact of the coronavirus
outbreak on the global economic growth after a spike in the
number of new cases outside China.
Sectoral Impact:
S&P BSE sectoral indices fell sharply in February 2020. The S&P
BSE Realty index was the top sectoral laggard, plummeted
~16% after no measures were announced in the budget to
revive the real estate sector. Heavy sell-off was seen in auto
and capital goods stocks. The S&P BSE Auto index and S&P BSE
Capital Goods index declined around 14% and 12%,
respectively. The S&P BSE Metal index fell ~13% amid fears of
a large economic fallout of the coronavirus outbreak. The S&P
BSE Consumer Durables index was the only sectoral gainer – up
0.02% in the month.Data Source: CRISIL

3. Equity valuation index is calculated by assigning equal weights to Price to Earnings (PE), Price to book (PB), G-Sec*PE and
Market Cap to Gross Domestic Product (GDP)
Our Recommendation
Our Recommendations – Equity Schemes
Pure Equity
Schemes
ICICI Prudential Bluechip Fund
ICICI Prudential Multicap Fund
These Schemes aim to generate capital appreciation
through participation in equities.
Long-Term SIP
Schemes
ICICI Prudential Value Discovery Fund
ICICI Prudential Smallcap Fund
ICICI Prudential Midcap Fund
ICICI Prudential Large & Mid Cap Fund
ICICI Prudential India Opportunities Fund
These schemes aim to generate long term wealth
creation over a full market cycle.
Asset
Allocation
Schemes
ICICI Prudential Balanced Advantage Fund
ICICI Prudential Equity & Debt Fund
ICICI Prudential Multi-Asset Fund
ICICI Prudential Equity Savings Fund
ICICI Prudential Regular Savings Fund
ICICI Prudential Asset Allocator Fund (FOF)
These schemes aim to benefit from volatility and can be
suitable for investors aiming to participate in equities
with low volatility.
None of the aforesaid recommendations are based on any assumptions. These are purely for reference and the investors are requested to consult their
financial advisors.
50
70
90
110
130
150
170
Feb-06
Feb-07
Feb-08
Feb-09
Feb-10
Feb-11
Feb-12
Feb-13
Feb-14
Feb-15
Feb-16
Feb-17
Feb-18
Feb-19
Feb-20
Invest in Equities
Aggressively invest in Equities
Neutral
Incremental Money to Debt
Book Partial Profits
103.15
Equity Valuation Index

4. ICICI Prudential Bluechip Fund is suitable for investors who are seeking*(An open ended equity
scheme predominantly investing in large cap stocks):
 Long term wealth creation
 An open ended equity scheme predominantly investing in large cap stocks.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Large & Mid Cap Fund is suitable for investors who are seeking**(An open ended
equity scheme investing in both large cap and mid cap stocks):
 Long term wealth creation
 An open ended equity scheme investing in both large cap and mid cap stocks
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Value Discovery Fund is suitable for investors who are seeking*( An open ended
equity scheme following a value investment strategy):
 Long term wealth creation
 An open ended equity scheme following a value investment strategy.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Equity & Debt Fund is suitable for investors who are seeking*(An open ended hybrid
scheme investing predominantly in equity and equity related instruments):
 Long term wealth creation solution
 A balanced fund aiming for long term capital appreciation and current income by investing in
equity as well as fixed income securities.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Balanced Advantage Fund is suitable for investors who are seeking*(An open ended
dynamic asset allocation fund):
 Long term wealth creation solution
 An equity fund that aims for growth by investing in equity and derivatives.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Multicap Fund is suitable for investors who are seeking*(An open ended equity
scheme investing across large cap, mid cap, small cap stocks):
 Long term wealth creation
 An open ended equity scheme investing across largecap, mid cap and small cap stocks.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Equity Savings Fund is suitable for investors who are seeking*(An open ended
scheme investing in equity, arbitrage and debt):
 Long term wealth creation
 An Open ended scheme that seeks to generate regular income through investments in fixed
income securities, arbitrage and other derivative strategies and aim for long term capital
appreciation by investing in equity and equity related instruments.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Multi-Asset Fund is suitable for investors who are seeking*(An open ended scheme
investing in Equity, Debt, Gold/Gold ETF/units of REITs & InvITs and other asset classes as may be
permitted from time to time):
• Long term wealth creation
• An open ended scheme investing across asset classes.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
Riskometers

5. ICICI Prudential Regular Savings Fund is suitable for investors who are seeking*(An open ended
hybrid scheme investing predominantly in debt instruments):
 Medium to Long term regular income solution
 A hybrid fund that aims to generate regular income through investments primarily in debt
and money market instruments and long term capital appreciation by investing a portion in
equity.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Midcap Fund is suitable for investors who are seeking*(An open ended equity
scheme predominantly investing in mid cap stocks):
 Long term wealth creation
 An open-ended equity scheme that aims for capital appreciation by investing in diversified
mid cap companies.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Smallcap Fund is suitable for investors who are seeking*(An open ended equity
scheme predominantly investing in small cap stocks):
 Long term wealth creation
 An open ended equity scheme that seeks to generate capital appreciation by predominantly
investing in equity and equity related securities of small cap companies.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential Asset Allocator Fund (FOF) is suitable for investors who are seeking*(An open ended
fund of funds scheme investing in equity oriented schemes, debt oriented schemes and gold
ETFs/schemes) *Investors may please note that they will be bearing the recurring expenses of this Scheme in addition to the
expenses of the underlying Schemes in which this Scheme makes investment.:
 Long Term Wealth Creation
 An open ended fund of funds scheme investing in equity oriented schemes, debt oriented
schemes and gold ETFs/ schemes.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
ICICI Prudential India Opportunities Fund is suitable for investors who are seeking*(An open ended
equity scheme following special situation theme):
 Long Term Wealth Creation
 An equity scheme that invests in stocks based on special situations theme.
*Investors should consult their financial advisers if in doubt about whether the product is suitable for
them.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
In preparation of the material contained in this document, ICICI Prudential Asset Management Company Limited (the AMC) has used
information that is publicly available, including information developed in-house. Some of the material used in the document may
have been obtained from members/persons other than the AMC and/or its affiliates and which may have been made available to the
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AMC, however, does not warrant the accuracy, reasonableness and / or completeness of any information. We have included
statements / opinions / recommendations in this document, which contain words, or phrases such as “will”, “expect”, “should”,
“believe” and similar expressions or variations of such expressions that are “forward looking statements”. Actual results may differ
materially from those suggested by the forward looking statements due to risk or uncertainties associated with our expectations
with respect to, but not limited to, exposure to market risks, general economic and political conditions in India and other countries
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unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices etc. The AMC (including its
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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 material in any manner. The recipient alone shall be fully responsible/are liable for any
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and other financial implication or consequence of subscribing to the units of ICICI Prudential Mutual Fund. The sector(s)/stock(s)
mentioned in this communication do not constitute any recommendation of the same and ICICI Prudential Mutual Fund may or may
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