Hdfc Asset Management Co. Ltd. · NSE:HDFCAMC
Hdfc Asset Management — Investor Presentation (March 2024)
28 slides from Hdfc Asset Management's investor presentation, Mar 21, 2024
Slide 1: Unlock the Realty Potential
rusted Unlock the Realty Potential NFO HDFC NIFTY Realty Index Fund Period: 7th-21st March, 2024 HDFC Asset Management Company Limited has been managing equity Index Solutions for over 20 years. For disclaimers, refer Slide 27
Slide 2: Why invest in the HDFC NIFTY Realty Index Fund?
Why invest in the HDFC NIFTY Realty Index Fund? The Realty sector is recovering after a decade-long period of consolidation Rising per capita incomes, improving affordability, increased urbanization, government initiatives and RERA^ can drive growth for years to come Listed Realty companies are pois
Slide 3: The Realty sector: Poised for long-term growth
The Realty sector: Poised for long-term growth Large growth runway ahead for Real Estate sector India's Real Estate Market (US$ billion) The Real Estate sector is expected to: 6000 Expand - To $5.8trillion by 2047, from $0.48trn in 2022 4000 Contribute - 15.5% of India’s GDP from existing share of 7
Slide 4: Multiple growth drivers for the real estate sector
Multiple growth drivers for the real estate sector Regulatory initiatives like RERA have helped boost transparency and Residential buyer confidence in the residential segment The commercial market has been driven mostly by growth in IT, BFSI, Commercial consulting and manufacturing industries Real Re
Slide 5: Rising incomes and growing share of high income earners to support demand for housing
Rising incomes and growing share of high income earners to support demand for housing Per Capita GDP is expected to rise… …With growing share of high income earners India - GDP Per Capita, current prices (USD) Estimate of share of households across income groups 4,500 100% 3% 8% 7% 9% 4,000 90% 21%
Slide 6: Home affordability has improved, thanks to lower home loan rates
Home affordability has improved, thanks to lower home loan rates Home loan rates are lower than 2012 levels… …leading to improved home affordability 12 Affordability ratio (Home loan payment / Income ratio) 65 11 60 58 56 Less affordable 55 53 10 50 50 More affordable 50 49 48 45 44 44 9 % % 40 38 3
Slide 7: The trend of increasing urbanization continues
The trend of increasing urbanization continues India - Urbanization ratio (%) Urban population in India (million) 40 700 35 35.9 650 30 600 550 (%) 25 500 20 450 15 400 350 10 300 1962 1967 1972 1977 1982 1987 1992 1997 2002 2007 2012 2017 2022 2015 2020 2025F 2030F 2035F Source: IMF Source: IBEF Th
Slide 8: Government support & improved transparency through regulatory initiatives
Government support & improved transparency through regulatory initiatives Key Government Initiatives: 01 Under its flagship scheme, Pradhan Mantri Awas Yojana (PMAY) – Housing for all, 2022 – the Finance Ministry announced a commitment of Rs. 79,000 crores in Union Budget 2023-24, a 66% increase comp
Slide 9: New launches and sales have recovered strongly after consolidation
New launches and sales have recovered strongly after consolidation 800 New launches (msf) Sales (msf) 700 Million square feet (msf) 600 500 400 300 200 100 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Source: Jefferies For disclaimers refer slide 27 09
Slide 10: Declining housing inventory has helped support house price growth
Declining housing inventory has helped support house price growth Inventory levels have been declining across cities House prices are recovering after low growth over 2013-21 60 14.0 Average price change across 12.0 50 Top 7 cities (% YoY) 10.0 Months to sell 40 8.0 % YoY 30 6.0 4.0 20 2.0 10 7-Citi
Slide 11: Demand for commercial and retail segments has remained strong
Demand for commercial and retail segments has remained strong Office space demand has recovered post-Covid Grade-A mall demand has been exceeding supply recently 60 12 51.6 50.2 10.0 50 Million square feet (msf) 47.8 10 44.9 Million square feet (msf) 41.1 40 39.1 38.4 8 36.6 7.1 34.2 32.3 32.9 29.0 3
Slide 12: Listed realty companies – Improving fundamentals (1)
Listed realty companies – Improving fundamentals (1) Beneficiaries of ongoing premiumization & formalization of the sector Increasing demand for luxury homes Listed developers have gained market share Share of Sales by Ticket Size 510 Tr-4Q sales, indexed to 100% Dec'17 quarter 460 90% 16% 18% 20% 2
Slide 13: Listed realty companies – Improving fundamentals (2)
Listed realty companies – Improving fundamentals (2) Balance sheets stronger thanks to falling leverage, profitability metrics in uptrend Net Profit Margin trending higher for NIFTY Realty Leverage reducing for NIFTY Realty constituents constituents Total Debt to Total Assets (%) Net Profit Margin (%)
Slide 14: Valuations of listed real estate companies
Valuations of listed real estate companies 1-year forward Price to Book ratio 1-year forward Price to Book ratio for Real Estate companies 4.0 3.5 3.0 2.5 2.0 1.5 1.0 Feb-09 Aug-09 Feb-10 Aug-10 Feb-11 Aug-11 Feb-12 Aug-12 Feb-13 Aug-13 Feb-14 Aug-14 Feb-15 Aug-15 Feb-16 Aug-16 Feb-17 Aug-17 Feb-18
Slide 15: Snapshot of NIFTY Realty Index
Snapshot of NIFTY Realty Index Captures the performance of the real estate companies. Currently has 10 constituents Stocks capped at 33% each, top 3 stocks capped at 62% in aggregate Index is re-balanced on a semi-annual basis in March and September Constituent Weightages (%) Key Index Stats Weighta
Slide 16: Advantages of Index Funds to get sector exposure
Advantages of Index Funds to get sector exposure A single Index Fund gives the investor sector exposure to multiple Realty stocks – no need for individual stock selection Advantage of the Index Fund is: Less impact of company-specific risk Capture performance of the sector with lower volatility than
Slide 17: NIFTY Realty TRI, NIFTY 500 TRI and NIFTY 50 TRI – Performance since inception
NIFTY Realty TRI, NIFTY 500 TRI and NIFTY 50 TRI – Performance since inception CAGR* as on Feb 29, 2024 Standard Deviation as on Feb 29, 2024 Return Periods NIFTY Realty TRI NIFTY 500 TRI NIFTY 50 TRI NIFTY Realty TRI NIFTY 500 TRI NIFTY 50 TRI 1 year 132.5% 39.7% 28.5% 21.7% 10.0% 10.0% 3 year 37.9
Slide 18: NIFTY Realty TRI, NIFTY 500 TRI and NIFTY 50 TRI – FY Performance
NIFTY Realty TRI, NIFTY 500 TRI and NIFTY 50 TRI – FY Performance FY NIFTY Realty TRI NIFTY 500 TRI NIFTY 50 TRI FY07 -24.5% -4.2% -3.2% FY08 38.4% 22.9% 25.1% FY09 Heatmap Key Rank 1 Rank 2 Rank 3 -80.6% -39.1% -35.4% FY10 114.4% 90.0% 75.3% FY11 -26.5% 8.4% 12.4% FY12 -23.3% -7.7% -8.2% NIFTY Real
Slide 19: Presenting HDFC NIFTY Realty Index Fund
Presenting HDFC NIFTY Realty Index Fund An Open-ended scheme replicating/tracking the NIFTY Realty Index (TRI) For disclaimers refer slide 27 19
Slide 20: Why invest in the HDFC NIFTY Realty Index Fund?
Why invest in the HDFC NIFTY Realty Index Fund? Structural tailwinds for Listed companies’ Exposure to multiple stocks HDFC AMC - the real estate sector fundamentals improving through a single index fund Trusted for 20 Rising per capita incomes, Listed Realty companies have The HDFC NIFTY Realty Ind
Slide 21: Who should invest in HDFC NIFTY Realty Index Fund?
Who should invest in HDFC NIFTY Realty Index Fund?� The HDFC NIFTY Realty Index Fund could be suitable for investors who: Seek diversified exposure to the growth potential of the Real Estate sector Have a high volatility tolerance Prefer a low-cost investment option to earn index linked returns Inves
Slide 22: What are the key risks and mitigants?
What are the key risks and mitigants? Key Risks Mitigants The Real Estate sector is cyclical in nature. Cyclicality of the A longer holding period can potentially mitigate short-term underlying business can cause volatility in index performance. fluctuations. Any slowdown in GDP growth or adverse cha
Slide 23: HDFC AMC: Key strengths in passives
HDFC AMC: Key strengths in passives Trusted for 20 in index Wide Product Range One of the largest funds across solutions several categories: 19 ETFs, 18 Index Funds & 3 FoFs HDFC AMC has been a trusted including: Market-cap based index funds fund manager in index solutions Commodity ETFs with over M
Slide 24: Fund facts: HDFC NIFTY Realty Index Fund
Fund facts: HDFC NIFTY Realty Index Fund HDFC NIFTY Realty Index Fund Type of Scheme An open ended scheme replicating/tracking NIFTY Realty Index (TRI) To generate returns that are commensurate (before fees and expenses) with the performance of the NIFTY Realty Investment Index (TRI), subject to tra
Slide 25: Asset allocation table – HDFC NIFTY Realty Index Fund
Asset allocation table – HDFC NIFTY Realty Index Fund Under normal circumstances, the asset allocation (% of Net Assets) of the scheme’s portfolio will be as follows: Minimum Allocation Maximum Allocation Types of Instruments Risk Profile (% of Total Assets) (% of Total Assets) Securities covered by
Slide 26: Product labeling and benchmark riskometer
Product labeling and benchmark riskometer This product is suitable for investors who are seeking*: Riskometer# • Returns that are commensurate (before fees and expenses) with the performance of the NIFTY Realty Index (TRI), over long term, subject to ate Mo derately oder tracking error ot te M High
Slide 27: Disclaimer
Disclaimer The views expressed herein are as of March 1, 2024 and are based on internal data, publicly available information and other sources believed to be reliable. Any calculations made are approximations, meant as guidelines only, which you must confirm before relying on them. The information co
Slide 28: Thank You
THANK YOU
HDFC Asset Management Company — Investor Presentation (March 2024) on 6ix