India equity

1 India equity strong catalysts in place2 Key themes driving the economy3 Source: Axis AMC Research. Data as on 30thSep, 2021 Government SupportUnorganized to Organized movementPost COVID RecoveryLow Interest RateBanking reformsStrong flowsUrban mobility indicators continue to improvePost COVID Tracking Normalcy4 Source: CEIC, Axis AMC is a lead indicator of economic activtyGoogle MobilityTraffic Congestion IndexDomestic Air Passenger TrafficThree Wheeler RegistrationsPetrol ConsumptionCOVID first waveCOVID second waveGlobal supply chain diversification trends supported by policyMake in India : Production Linked Incentives5 Source: Goldman Sachs, Axis AMC Research. Data as on 311st Dec, 2020. Past performance may or may not be sustained in future. Sector(s) / Stock(s) /Issuer(s) mentioned above are for the purpose of illustration and should not be construed as year fiscal support (INR bn)AutoMobileAdvance Chem BatteryPharmaNetworking & DrugsSpeciality SteelWhite GoodsElectronicSolarMedical DevicesSectors5 year fiscal support -INR BNNew added sectorsAdvance Chemistry & Cell (ACC) Battery181 Electronic/Technology Products50 Automobiles & Auto Components570 Pharmaceuticals drugs150 Telecom & Networking Products122 Textile Products.

2 MMF segment and technical textiles107 Food Products109 High Efficiency Solar PV Modules45 White Goods (ACs & LED)62 Speciality Steel63 Fiscal support1460 Existing sectorsMobile Manufacturing and Specified Electronic Components410 Critical Key Starting materials/Drug Intermediaries and Active Pharmaceutical Ingredients69 Manufacturing of Medical support513 Total fiscal support1973 Push on developing capabilities and - 2, 4, 6, 8, 10, 12, 14, 16, AFY18 AFY19 AFY20 AFY21 BEGovernment driving significant portion of capex increasinglyPvt sectorStatesCentral SchemesTotal CPSE CapexTotal Roads, Railways& Defence Capex% of GDP6000007000008000009000001000000110000 0120000013000001400000Q1Q2Q3Q4Q1Q2Q3Q4Q1 Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1 Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q12011-122012-1320 13-142014-152015-162016-172017-182018-19 2019-202020-212021-22 Gross fixed capital formationConstant Prices (Rs Crore)

3 Large Capex across industries by govt which eventually drives private capex Increase in Infra spend both in absolute and relative to GDP terms Investments into building capabilities, this can help drive the next decade of the Indian economySource: Phillip Capital, Axis AMC Research. Data as on 31st Sep, 20. Past performance may or may not be sustained in future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation.( )Banking reforms showing resultsFinancials positioned GNPA Declining0%10%20%30%40%50%60%70%80%90%10 0%FY10FY11FY12FY13FY14FY15FY16FY17FY18FY 19FY20FY21 Retail forming larger proportion of overall loans in BankingAGRICULTURECORPORATESERVICESRETAI L The last few years has seen significant corporate deleveraging as well as a move to higher quality assets Banks/NBFCs and regulators have helped to form better underwriting practices Granular & diversified Retail book driving growthSource: Credit Suisse, Morgan Stanley, Axis AMC Research.

4 Data as on 31st Sep, 20. Past performance may or may not be sustained in future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as inflows reflect confidence in the India StoryStrong capital flows805101520253035404550FY12FY13FY14FY 15FY16FY17FY18FY19FY20FY21FY22-TillJuly' 21 Net FDI (US$ Nn) equity DeaIs ($Bn)Source: Credit Suisse, Phillip Capital, Morgan Stanley, Axis AMC Research. Data as on 31st Sep, 20. Past performance may or may not be sustained in future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as ratesAsset qualityAsset qualityInterest ratesHousingCorporate profitabilityCorporate capexHousingCorporate leveragingCorporate profitabilityCorporate leveragingCorporate capex4Q211Q20 Inventory at 7 year lows Affordability at 2004 levelsHousing Gross NPL s at lows Net NPL is down 60% in 3 YearsAsset Quality Corporate Roe is at decade highsCorporate Profitability Leverage has significantly reduced in last 5 yearsCorporate Leveraging Interest Rates are low, to rise with growthInterest Rates Strong government capex should lead to more corporate capexCorporate CapexSource: Jefferies, Axis AMC Research.

5 Data as on 31st Sep, 20. Past performance may or may not be sustained in future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as tomulti cap10 Understanding market capitalizationWhat are the different market segments?11 Defined as Top 100 companies by market capitalization in India (~>30000 Cr)Defined as the 101 to 250th companies by market capitalization in India (~>10000 Cr)Defined as the 251st and lower companies by market capitalization in IndiaLarge CapMid CapSmall CapCurrent Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. Market caps are defined as per SEBI regulations as below: a. Large Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization.

6 C. Small Cap: 251st company onwards in terms of full market market capitalizationWhat are the different market segments?12 Generally large, established businesses These companies dominate the industry and are stable Often less volatile and highly liquid Midsized companies which are still getting established Generally, have higher growth prospects Slightly volatile and quite liquid Most high-risk segment with emerging companies Opportunity for huge growth but drawdowns also Highly volatile and not very liquidLarge CapMid CapSmall CapCurrent Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. Market caps are defined as per SEBI regulations as below: a. Large Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization.

7 C. Small Cap: 251st company onwards in terms of full market CharacteristicsWhat are the different market segments?13 Large Cap (1-100)Mid Cap (101-250)Small Cap (251-500)Avg. daily traded value 6M40,34315,0669,152 Total free float (Lakh Cr)91189 Total market cap (Lakh Cr)1774121 Average FII holding22%13%12%Sector focusBanks, Insurance, IT, Auto, ConglomeratesIndustrials,MFI, NBFCs, Auto Ancillaries, PharmaAPI, Real EstateChemicals, ConsumerDurables, TextilesSource: Bloomberg, BSE, Axis AMC Research. Data as on 30th June 2021, Values in INR. Current Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets. Market caps are defined as per SEBI regulations as Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization.

8 C. Small Cap: 251st company onwards in terms of full market capitalization. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of illustration and should not be construed as recommendation. The fundmanager(s) may or may not choose to hold the stock mentioned, from time to time. Investors are requested to consult their financial, tax and other advisors before taking anyinvestment decision(s).Wealth is being created across the segments148,704 11,332 8,400 11,958 11,197 17,471 18,644 20,474 29,729 28,341 30,524 28,298 36,985 2,381 2,779 2,085 2,935 2,586 4,326 4,358 5,619 8,998 7,899 9,031 11,595 11,952 - 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 Large & Mid Cap definition cut off has almost doubled in the last 5 years100th Stock - Large Caps250th Stock - Mid CapsSource: Bloomberg. Current Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s viewof the equity markets.

9 Market caps are defined as per SEBI regulations as below: a. Large Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization. c. Small Cap: 251st company onwards in terms of full market capitalization.(Cr.)Traditional Life Cycle of a companyA company can be in different segments over their lifecycle15 Start-up PhaseGrowth PhaseMature PhaseSmall CapsMid CapsLarge Caps Newly established businesses Limited track record Prone to significantly higher risks Superior growth profile Established track record Maintains flexibility Lower risk compared to smaller companies emerging companies High growth phase But prone to higher risks Business not yet well established Stable growth Established business models Reduced flexibility Lower risk compared to mid cap companiesCurrent Portfolio Allocation is based on the prevailing market conditions and is subject to changes depending on the fund manager s view of the equity markets.

10 Market caps are defined as per SEBI regulations as below: a. Large Cap: 1st -100th company in terms of full market capitalization. b. Mid Cap: 101st -250th company in terms of full market capitalization. c. Small Cap: 251st company onwards in terms of full market the right companies essentialOnly good companies are able to make the transition16 Source: Bloomberg, NSE, Axis MF Internal Analysis. Past performance may or may not be sustained in the future. Above illustration includes data for all listed companies only in Nifty 500 Index. For the above analysis, Top 100 companies by market cap are considered as large cap companies, 101stto250th companies as midcap companies and the rest as small cap companies. Data period:31st Dec 2010 31st Dec 2020 Market cap buckets (Dec 2020)Large capMidcapSmall capMerged/Acquired/DelistedGrand TotalNo of companies that were large cap 10 years back are now6121126100No of companies that were mid cap 10 years back are now21457311150No of companies that were small cap 10 years back are now32219333251 Large caps provide cushion during tough market conditions while Mid and Small help drive alphaDifferent segments work in different phases17 Source: Bloomberg, Axis MF ResearchPast performance may or may not be sustained in future.