India Avenue Equity Fund - L Class

The India Avenue Equity Fund provides a diversified exposure across high quality Indian corporate success stories as well as to companies which are less known, but with the potential to be tomorrow’s leading companies.

A long-term investment, in a well-diversified portfolio of companies, listed predominantly on India’s stock exchanges. The Fund provides exposure to large, already successful companies growing strongly given India’s fundamentals as well to companies which are under-researched and less known, but with the potential to be tomorrow’s leading companies given an ecosystem highly conducive to growth. The Fund is suitable for both for institutional and retail clients with an investment horizon of 5-7 years and looking to participate and benefit from India’s growth story.

India Avenue’s investment philosophy seeks to capture two primary sources of investment return over time:

1. India’s expected strong GDP growth over the next few decades is likely to lead to significant investment returns from investing in its capital markets; and
2. Active management, particularly where markets are less efficient, is likely to deliver superior returns over the long term in comparison to investing passively.

Additionally, India Avenue partners with selective local investment advisers to identify the best companies to invest in.

“Partnering” refers to outsourcing of stock selection to selective high calibre local investment advisors who have access to corporate management and strong network within local markets.

India Avenue’s investment process involves:

1. Strategic and thematic idea generation to formulate the strategy for the portfolio
2. Investment Advisor selection
3. Portfolio construction

In selecting the investment advisors, India Avenue follows the following process:

• Identifying an investment universe of suitable investment advisors through India Avenue’s investment experience, strong network, database and local market connectivity
• Quantitative analysis to screen for appropriate investment advisors
• Qualitative analysis and oversight to reduce investment advisors to a short list. Some of the factors examined include:
  i. A reputable asset manager, with an audited performance track record
  ii. Experience and stability of the investment team of the investment advisor
  iii. A consistent and rational investment philosophy and process
• Due-diligence on short listed advisors, including attribution analysis to determine core skill sets
• Structuring of investment advisory agreements
• Establishment of “back-up” investment advisors
• Portfolio construction incorporating blending of different investment styles
• Review and ongoing monitoring India Avenue may conduct due diligence on the stocks recommended by the investment advisors. If the recommendations given by the advisors aligns with the overall objective of the Fund, India Avenue proceeds to make the investment in the selected stock, if not, India Avenue may reject the recommendations of the investment advisors, at their own discretion.

All investment advisors are remunerated based on their provision of advice which includes proposed stock names, stock weighting allocation and cash levels. However, all execution and implementation of trades proposed occur through India Avenue’s staff.

The Fund will invest in a diversified portfolio of stocks of Indian companies either listed on stock exchanges in India or any other recognised global stock exchange. The Fund may also invest in cash and cash equivalent instruments like short term money market securities as well as both exchange traded and over the counter derivatives for hedging purposes.

Asset Limits:

• Indian Listed Equities 70-100%
• Cash and Cash Equivalents 0-30%
• Derivatives 0-20%

The asset allocation guidelines indicated above are not absolute and can be exceeded due to sudden market movements or transitory changes from large cash flows or portfolio construction decisions.

Lonsec Rating: Recommended*

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This presentation (‘Presentation’) has been produced by India Avenue Investment Management Limited (‘IAIM’) ABN 38 604 095 954, AFSL 478233 and has been prepared for informational and discussion purposes only.  This does not constitute an offer to sell or a solicitation of an offer to purchase any security or financial product or service.  Any such offer or solicitation shall be made only pursuant to a Product Disclosure Statement, Information Memorandum or other offer document (collectively ‘Offer Document’) relating to an IAIM financial product or service. A copy of the relevant Offer Document relating to an IAIM product or service may be obtained by writing to us on info@indiaavenueinvest.com or by visiting www.indiaavenueinvest.com. This Presentation does not constitute a part of any Offer Document issued by IAIM. The information contained in this Presentation may not be reproduced, used or disclosed, in whole or in part, without the prior written consent of IAIM.

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