Equity MFs’ Cash Component reaches 6.5% as the Shares Floats at Maximum Hike

Due to the high amount of inflows as shares in India are floating at maximum hike till now, the equity fund managers and investors are keeping a high amount of cash as a safeguard. According to the recent data, the cash component within Total Equity AUM (Assets under Management) has touched more than 6.5% which is a big hike throughout many past years. In the past year 2016, cash components have not exceeded even 4%.


High valuations in the mid-cap, as well as the small-cap, are making the fund managers be cautious and they have been trying to cash out from those positions. One of the main reasons for the increase in cash components is demonetization, since the month of November when the demonetization was announced, there has been a continuous problem in deploying the cash which results in the increase in cash component.

Market Cap to GDP Ratio Signals Upside for equity

Recently, one of the CIO (Chief Investment Officer) says that I can’t afford risk with the investors’ money at any point of time while making returns for the investors. I can’t be incautious towards the investors’ money at any time and especially when the expectations are too high to manage. Continuous efforts are being made to move maximum assets into a large group of the sectors, like Tata Motors, ICICI Bank, Infosys, L&T and Sun Pharma.  It may take some time to pull out the excess cash liquidity. My advice is to stay continue with the SIPs (Systematic Investment Plans) and the investors must not put more money via lump-sum amounts at such times.

For example, ICICI Prudential Mutual Funds’ total cash component has made a hike and reaches at 10.2% in the month of April while it was just 8.8% in March. HDFC Mutual Fund has made full investments in stock in the previous two months and had its cash level at 4.4% in April which was only 1.5% in March. Many other names like Reliance Nippon, Birla Sun Life Mutual Fund, and SBI Mutual Fund also increase their cash in the portfolios.

However, checking out the data of some past years, the percentage of cash component in Mutual Funds are very minimal in comparison to the time after the 2008 global financial crisis, when the percentage of cash components were 15 to 20% of the total Equity Assets under Management.

Success story from 1 Lakh to 1 Crore in 22 years

A breathtaking success of Reliance Growth Fund! It’s a time for celebration for the investors who put in Rs 1 lakh in Reliance Growth Fund in its NFO (New Fund Offers). There is a massive hike in its value which would more than Rs 1 crore. The fund was launched nearly 22 years ago in October 1995.

The net asset value or NAV (the value per share of a mutual fund on a specific date or time) of Reliance Growth Fund, hit the Rs 1,000 milestone and creates a history by becoming the first fund in the industry to cross or achieve Rs 1,000 NAV level.

As for example, if we consider an investor who puts Rs. 1 Lakh in the fund during its establishment, then it grows 100 times in just a time period of 22 years. And this makes us believe that Mutual fund is the best investment option for the long-term value creation.

SuccessReliance Growth Fund is a midcap-oriented fund that seeks to achieve long-term growth of capital by investment in equity and equity related securities. As of May 17th , Reliance Growth Fund had a NAV of 1,027.8567

The fund has a collection of over Rs 5,000 crores from more than 6 Lakh investors.


Success story from the 2000s

Reliance Growth Fund had been quite impressive since the past 2000s. It sought the confidence of many investors not only in the midcap space (which is thought to be very risky) but also for equity mutual funds in all over India.

When we talk about history, Reliance Growth Fund has been influenced by the two best fund managers in the industry of mutual fund. From the time of the early 2000s, Madhusudan Kela is known to be one of the best stock pickers in the market. He managed the Reliance Growth fund along with Sunil Singhania, who is the current CIO of Reliance Mutual Fund.

During the mid-2000s, Reliance Growth Fund was one of the fastest growing mutual fund schemes, in terms of Assets under Management (AUM).

Failure in the year 2008

There was a heartbreaking financial crisis in the year 2008, which blew out equity markets all over the world, also including India. Dow Jones, which is known to be the one of the largest business and financial news companies in the world, fell down by more than 50% and the BSE- Sensex fell by 60% (Approx.) from the year 2008 to early 2009.

The NAV of Reliance Growth Fund collapsed by more than 54%. But there was a comeback by the fund in the year 2009 by providing 100% returns to the investors.

In the year 2011, the bear market was the another fell down and the NAV fell by 27%. There was the great struggle in the market for the Reliance Growth Fund during that time.


The above graph shows that, with an investment of just Rs 10,000/-  on a monthly basis over the past 20 years, you could have accumulated a corpus of nearly Rs 6.3 Crores, another example of the fantastic wealth creation by this fund. The annualized SIP returns (XIRR) over the past 20 years is nearly 25%.

The annual return of Reliance Growth Fund from the past 5 years is considered to be more than 20%. The Fund has given the annual returns of 17% from last 3 years. And the same of last 1 year is 31%.

( Mutual Fund investments are subject to market risks, read all scheme related documents carefully. Past performance is not an indicator of future returns. )

Recasting in Plan of action

Before the financial crisis in the year 2008, both the fund manager and the CIO of Reliance Mutual Fund, Madhusudhan Kela and Sunil Singhania had started assigning a lump of their portfolio in large cap stocks.

And the similar strategy has come once again as on April 2017, large cap stocks consist of more than 55% of the portfolio value.

In 2011, MadhusudhanKela left Reliance Mutual fund to take up the role of Chief Investment Strategist of Reliance Capital, which is the parent company of Reliance Mutual Fund.

After MadhusudhanKela, Sunil Singhania took the leadership of Reliance Mutual Fund investments as CIO and is already the fund manager Of Reliance Growth Fund.

Reliance Growth Fund Vs other asset classes


The above-mentioned chart shows the growth of Rs 1 lakh invested in Reliance Growth Fund in 1996 versus various asset classes till 2017.

The graph shows that Sensex and BSE 100 outperformed Gold and Fixed Deposit over the past 20 years or so, showing the superiority of equity as an asset class; but the wealth appreciation with Reliance Growth Fund has been at a completely different level, showing the alpha created by the fund managers over the years.

Industry AllocationAsset allocation


There is a great success of Reliance Growth Fund from the past 20 years which you can see above. The precise decision making of Sunil Singhania gives investors a confidence with respect to future performance support.


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.

Risks in Different Sectors of Equity Market

What does equity market actually means?

The equity market, also known as the stock market in which shares are issued and traded, either through exchanges or over-the-counter markets. It is one of the most vital areas of a market economy because it gives company’s access to capital and investors a slice of ownership in a company with the potential to realize gains based on its future performance.

Equity markets are the meeting point for buyers and sellers of stocks. The securities traded in the equity market can be either public stocks, which are those listed on the stock exchange, or privately traded stocks. Often, private stocks are traded through dealers.

The equity market is the market for trading equity instruments. Stocks are securities that are a claim on the earnings and assets of a corporation.


Equity Risk

It is the financial risk involved in holding equity in a particular investment. It refers to the equity in companies through the purchase of stocks and does not commonly refer to the risk in paying into real estate or building equity in properties.

With indices trading way above historical average valuations, investors may have to tone down return expectations. Now, let’s move into the different sectors of the equity market.


The BSE Sensex is quite expensive, as it is indicating a 24% premium on historical average. Previous years return suggests that there is 50% chance of an investor to suffer loss after a year from current valuation.

Previous years return

1 year- 16.5%

3 year- 9.2%

5 year- 12.7%



It is the most expensive sector of the equity market with 38% premium to the historical average. Foregoing data indicates that the index has got a 1-year return of around 17% from these levels. And carries the one-fifth chances of loss.

Previous years return

1 year- 20.6 %

3 year- 19%

5 year- 19.7%Auto

Risk and Return


It has been trading at a minimal premium to historical valuations. The capital goods firm is struggling to give good returns from the past years. There is a high chance of loss in this sector.

Previous years return

1 year- 36.1%

3 year- 13.4%

5 year- 15.5%capital goods

Strategies that fit the Bull Markets


It trades only at a low premium to past valuations and has risen smartly in recent months. In the past years, the data shows that they have not fared well from similar levels and hence, the chance of loss high.

Previous years return

1 year- 50%

3 year- 12.9%

5 year- 13.6%

oil and gas


Valuations for consumer staples firms are at the higher end of historical average. The index shows 11% median return over 1 year from current levels in the past, the upside has been muted.

Previous years return

1 year- 19.6%

3 year- 16.6%

5 year- 15.2%FMCG


The IT index is currently trading at a considerable discount to historical valuations. You may consider it a good valuable bet and consider its very best historical returns from similar levels in the previous years. However, a repeat performance is somehow doubtful.

Previous years return

1 year- 10.5%

3 year- 4.9%

5 year- 12.2%


It’s trading is done at a slight premium to their historical average valuations in terms of price-to-book value (PBV). From the previous data, it has been concluded that there are healthy returns from these levels.

Previous years return

1 year- 36.4%

3 year- 18.5%

5 year- 18.9%


It is trading at a low discount as Pharma and Healthcare stocks have very poor progress. These have given good returns from such valuations in the previous years. This sector has usually made a profit from these levels; this may get change according to the situation.

Previous years return

1 year: -5.7%

3 year: 12.5%

5 year: 18.0%



No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.

How to Make an Efficient Investment Portfolio ?

When it comes to rebalancing your portfolio it is always a good time to review your investment portfolio. Rebalancing your portfolio and removing sluggish motion is as important as knowing the gains and losses from your investments. If you are an investor then, you must know how to settle your investments and assets allocation in the best way to achieve your personal goals through your strategies. That simply means your portfolio should be very well organized and keeps you out of stress making situations throughout the whole financial year.

Here are some tips to make a proper investment portfolio-

Decide the proper asset allocation for you

The first step towards constructing a portfolio is that you have to know your financial situation and work according to it to achieve your investment goals. One of the things to keep in your mind is to consider age while making portfolio because a college graduate whose career is about to start to need a different investment procedure and plans than a 50-year-old married person who is trying to help for his child’s college education. Another point that should be considered while making portfolio is to know your personality and risk appetite. Depending on your current situation, your needs in future and your risk appetite will decide how your investments should be assigned in different asset classes. The possibility of best returns may come with the biggest risk of loss. For example, a young person who is not depending on his investments for income can take the risk for better returns but person near to his retirement should not take such risks and should focus on making income in a proper manner.


There must be a proper reason for your investment

Most of the investors can’t even explain why they invest in this or that, only after watching an advertisement in your T.V. or after reading the top 10 list on some publication is not a good enough and satisfying answer. To know about investments you do you should know the reason of your investment before and it will help you in improving your portfolio.

Do not make investments if you don’t understand about

Many of the investors only know the key point like, ‘this ETF will give twice returns and that mutual fund will give a minimum of 7% interest per year guaranteed. But it is not sufficient; they don’t even know how to calculate the returns on the investments they made. If one has no knowledge about how investment works then, maybe he does not need that actually.

Three finance lessons for your child

Clear all your credit card debts

The next step towards completion of your portfolio is to make a proper plan for paying off all your credit card debts.

Make a balance sheet and write down all your debts by ranking the highest interest rates on top then try to pay according to it. The process may take a long period of time but to do it faster avoid making new charges and find another source of income to clear your debts.

Make an emergency

emergency fund

Building an emergency fund is very important because it will help you in utilizing your money when you actually need it. This will make you prepared for any difficult financial situations like home repairs, unemployment, medical issues etc. So, your emergency fund should be sufficient to take care of any financial situations like-

  • Mortgage payments
  • Insurance premiums
  • Medical bills
  • Payment of credit card debts

Invest in other investment options

While moving on step by step process to make a portfolio, the next step should be investing in other options like stocks, bonds, real estate property, mutual funds etc. because that will give extra returns on your investment. By investing in different alternatives you can generate an extra source of income for yourself through returns.

Only 24% Indians are financially literate : S & P

Know what not to do

Many investors make common mistakes while investing like

  • Following trend

Focusing and following the trend of the market can get you in big trouble because the probability is the investment fad has already made returns before you even know about.

  • Never lose money and don’t get satisfied

The habit of ‘set it and forget it’ can be costly sometimes. You must review your portfolio regularly (once in a year) so that you can remind yourself of your process.

Also, one must keep in mind that proper investments are not as easy as pie and also it’s not a game. There are ups and downs in the market but having a complete and an effective portfolio can help you to achieve your investment goals and can avoid the stress throughout the whole fiscal year.

PSP Projects Ltd IPO Review

PSP Projects Ltd is a multidisciplinary company which offers a diversified range of construction and allied services across industrial, institutional, government, government residential and residential projects throughout India and was incorporated in the year 2008.

It provides services across the construction value chain, ranging from planning and design to construction and post-construction activities to private and public sector enterprises.

Previously, it was focusing only in the Gujarat, but now it has geographically diversified its portfolio of services and is undertaking or have bid for projects pan India. One of the first major projects that they completed was the construction of the GCS Medical College, Hospital and Research Centre (managed by the Gujarat Cancer Society) in June 2012.

The company constructs industrial buildings for pharmaceutical plants, food processing units, engineering units and manufacturing and processing facilities; and buildings for hospitals and healthcare services, educational institutes, malls, hospitality services, and corporate offices.

They also undertake government projects and government residential projects; and constructs buildings for group housing and townships, as well as independent residences for select private customers, as well as manufactures ready mix concrete.


Issue Details

  • Issue Open: May 17, 2017

 Issue Close: May 19, 2017

 Issue Size:

 10,080,000 Equity shares of Rs 10 aggregating up to Rs 211.68 Crore

  • Fresh issue of 7,200,000 Equity shares of Rs 10 aggregating up to Rs [.] Crore
  • Offer for sale of 2,880,000 Equity shares of Rs aggregating up to Rs [.] Crore

 Face Value: Rs 10 Per Equity share

 Issue Price: Rs 205 – Rs 210 per Equity share

  • Market Lot: 70 shares

Listing At: BSE/NSE

Promoters of the Company

  • Prahaladbhai Shivrambhai Patel
  • Shilpaben Patel

Lead Managers

Karvy Investor Services Limited and Motilal Oswal Investment Advisors Limited are the leading managers of the ISP Projects Ltd IPO company.

Object of the Issue

  • Financing working capital requirement of the company.
  • Financing capital expenditure requirements of the company.
  • General corporate responses.

Financial Details of the Company


Within the last 5 years till FY16, the company’s standalone revenue grew 26.8% annually to 467 crores. Net profit grew 31.6% to 24.9 crores. In FY16, its debt-to-equity ratio was 0.7 and return on equity was 44%.

Anchor Investors

Company raises Rs 95 crores through 9 anchor investors

PSP Projects Ltd IPO raises Rs 95 crore ahead of its IPO on Tuesday by allotting 45.36 lakh equity shares at Rs 210 per share to nine anchor investors, including Reliance Mutual Fund, SBI Mutual Fund, Axis Mutual Fund, Sundaram Mutual Fund, Birla Sunlife Insurance and TATA AIA, among others.

BSE Limited IPO- Positive & Negative factors related to investment

Key strengths

  • The company is present across the construction value chain and provide the customer a one-stop solution for all of its constructional services.
  • The Track record in Gujarat contains victorious project executions.
  • The overall financial track record is good. Contract income recorded CAGR of 26.4% from FY 2012 to FY 2016.
  • It has a strong relationship with customers help in getting repeat orders despite competition.
  • It has a record of executing 14 projects of Cadila Healthcare since FY 2009.
  • It is earning consistent profits from the last 5 years which ranges between 4.5% to 5%.

Key Weaknesses

  • The business is exposed to implementation and other risks including litigation and retention money issues post execution of projects.
  • Most of the order book of the company comprises of fixed price contracts and any increase in raw material and other expenditure will have to be borne by the company.
  • Revenues are difficult to predict and are subject to seasonal variations.
  • Operations are concentrated in Gujarat, accounting for 100% of total contract income in FY 2016 and 96% of total contract income in the nine months ended FY 2017. If by any chance there is a change in the laws and regulations or political and economic environment in Gujarat will have a major effect on the financials.
  • There are legal proceedings currently outstanding the company. Any adverse decision may render to liabilities and may adversely affect its business, results of operations and profitability.
  • There was negative cash flow from operations in the nine months ended December 2016.
  • Its projects are exposed to various to implementation and other risk and uncertainties.
  • The business is subject to investments in the construction sector. These are dependent on government and private spending. Demand for services will get affected in the event of any economic downturn or unfavorable government policies.


It has been observed from the data before nine months to December 2016, the company seeks a price-to-book valuation of around seven. When we compare it with its peers such as Ahluwalia Contracts India and PNC Infratech, it is quite expensive.

Grey Market Premium

Since the IPO size is expected to be less than Rs. 250 crores, the scrip is expected to get listed in T – segment and hence at present, we cannot comment as to what will be the Grey Market fancy for this IPO.


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.


India Grid InvIT Fund IPO (IndiGrid InvIT Fund) Review

After the splendid success of IRB InvIT Fund IPO, now the India Grid InvIT IPO is all set to capture the segment. IndiGrid InvIT Fund IPO was incorporated in the year 2016. It is an infrastructure investment trust (InvIT), which was established to own inter-state power transmission assets in India. Their central point of attention is mainly on providing constant and reasonable distributions to their unitholders. IndiGrid Trust plans to raise Rs 2,250 crore through an initial public offer (IPO). The Trust not only allows infrastructure developers to deleverage their balance sheets but also refinance remaining debt at a low rate of interest.

It has been sponsored by Sterlite Power Grid Ventures Ltd, which is one of the topmost leading companies operating in the private sector, with great experience in bidding, designing, financing, constructing and maintaining power transmission projects across India.

The sponsored company owns 11 inter-state power transmission projects with a total network of 30 power transmission lines of approximately 7,733 circuit km and 9 substations having 13,890 MVA of transformation capacity.


Issue Details

Issue Open: May 17, 2017

Isuue Close: May 19, 2017

Issue Size: Rs 2,250 Crores

Face Value: Rs 10 per unit

Issue price band: Rs 98 to Rs 100 per unit

Market lot: Minimum lot of Rs 10,205 units @ Rs 98 to Rs 100 per unit.

Minimum Investment: Rs 10 Lakhs on lower price band

Listing: BSE/NSE

Leading Managers

Morgan Stanley, Citigroup Global Markets India, Edelweiss Financial Services.

Objects of the issue

It is to provide a loan to BDTL and JTCL for the repayment or prepayment of debt of banks, financial institutions, SGL1, SGL2.

The other object of the issue is the repayment of any other long term and short term liabilities and capital expenditure creditors.


IndiGrid InvIT Fund IPO is provided with the corporate credit rating of “AAA”/Stable by Crisil, “IrAAA”/Stable by ICRA and IND “AAA”/Stable by India Ratings.

What are InvITs?

An InvIT is a new capital market product promoted by the Government to enable Infrastructure Developers to free up tied-up capital. InvITs are designed to attract low-cost long term capital from FIIs, Insurance and Pension Funds and the DIIs (mutual funds, Banks) which will also benefit to  HNIs .

Anchor Investor

India Grid Trust, an infrastructure investment trust (InvIT), raised over Rs 1,012 crore from anchor investors ahead of its initial share- sale offer opening today.

Among the anchor investors are Deutsche Global Infrastructure Fund, Credit Suisse (Singapore), Reliance Nippon Life Insurance Company, Copthall Mauritius Investment and Edelweiss Tokio Life Insurance Company.

Comparison b/w IRB and IndiGrid InvITs

IRB vs Indigrid1

Dividend Policy where investors may get rewards

At least 90% of distributed cash flow of the SPV shall be distributed to the InvIT in proportion to its holding in the SPV.

At least 90% of distributable cash flow of the InvIT shall be distributed to the unit holders.

Dividends are announced to be paid within 15 days of the establishment.

Reasons to invest in IndiGrid InvIT Fund IPO (Positive points)

It has a strong financial position in the market.

It is considered as the second company to get approved from SEBI under InvIT after IRB Fund.

It is the first trust in the power sector to get formed in InvIT regulations.

It has a constant cash flow from assets with little counterparty risks.

It has a good credit rating. CARE has rated as CARE AAA (Stable) IND RA as IND AAA Outlook Stable and ICRA as IR AAA. These ratings indicate credit worthiness of trust.

Out of the available cash flows, 90% of it would be distributed to unit holders by way of dividend which is tax-free.

It has Strong corporate governance and skilled and experienced investment managers.

It has its own ownership for the allotment of assets.

How REITs and InvITs will be a game changer for Indian real estate and Infra sector.

Reasons not to invest in IndiGrid InvIT Fund IPO

It is a new organization which doesn’t have an established operating history. Thus, it will be difficult to assess the future performance of the organization.

They may lose tariff revenues and incur significant repair and replacement costs in its power transmission projects are rendered inoperable due to force majeure events.

IndiGrid may be unable to operate and maintain its power transmission projects to achieve the authorized

At its worst, when the government regulation will change, then it would deeply affect its probability and ability to make distributions.

If the sponsor will get issues with some new units, then it will reduce the holding of the other unit holders.

More than 4 lakh Pune flat buyers are victims of the builders

To a large extent, all its revenues are derived from tariff payments received from LTTCs. So, if there is any delay in payments of the point of connection, then the charges to the CTU by the users and customers may affect the resultant cash flows and operations.

The potential of the project managers is to ensure that its power transmission systems are fully operational at all the times may be subject to the limitations of the power grid, existing equipment or operational risks outside of their control.

The initial portfolio asset may not achieve the projected financial performance referred to in the financial projections, which could deeply affect its ability to meet its projected distributions to its Unitholders.

Grey market premium

Currently Grey market premium is Rs. 5 /-


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.

How to withdraw your PF for purchasing home

EPFO members can now access and use their retirement savings to buy a home for themselves. It seems like the government is very effectively trying to fulfill the words ‘housing for everyone in next 5 years’. This is one of the main reasons behind the action that EPFO has allowed its members or contributors employees of the PF (provident scheme) to use their accounts for payments and for EMIs of home loans. Employees can now use up to 90% of EPF accumulations to complete the payments on houses or to pay the EMIs of home loans.

Also, there are some new rules in withdrawing the money for purchasing a home or a real estate property that the PF member must also be a member of a housing society which includes a minimum number of 10 members. Any of the employees who has been allotted a number as a PF member is then considered as a PF member by the EPFO.


The new rules are made for fulfilling of the existing rules for withdrawal of money from the provident fund by the employees for purchasing their homes. Also, it is essential information about the withdrawal that since the existing rules are considered as the important ones, one can withdraw funds according to his individual capacity even if he does not want to be a member of housing society after providing all the necessary documents in place. So, the PF member can avail a loan and can still withdraw funds to buy a house from the conditions and rules which already exist.

If one is the member then he can use the provident funds for various causes like the construction of a house, buying new plots, payments for home loans, paying EMIs for home loans. Also, the transaction can be made through any one of them like central government, private builders, and state government but there is a condition under which the member will be eligible for the scheme only if he has completed 3 years as a PF member.

No resale transactions

Any of the rules do not invigorate any kind of secondary market as well as the resale transactions regarding real estate properties. EPFO make payments directly to the state government, any housing agency, any builder, the central government in one or more installments in any case maybe.

EMI VS SIP ( Be controlled or take control )

Lump sum amount limit

The maximum limit of withdrawing the money is 90% of the PF account balance or the cost of acquisition of the property considering whichever is less. The balance of account includes the shares of contribution of the member plus the interest in addition and share of contribution of employee plus the interest. If the case is about constructing a house and the construction is done in the lower cost than prescribed and if the member does not get any allotment then the amount has to be refunded back to the EPFO within the time period of 30 days.

Paying EMIs through PF

According to new rules, a PF member who is also a member of a housing society can use the provident fund to pay the full payment or the EMIs for a loan in the name of the member after fulfilling the details in a given format. Also, there is now an easy option to repay the installments to society from the future contribution of the member in PF which was not at all available in the past. The installment or the EMI will be paid by EPFO to the bank or the government, as per the case.

Format of applying

If a member has already become a member of a housing society, then he can apply through housing society in a prescribed format for the completion of getting a certificate from EPFO.

Annexure I form

In the beginning, a form is issued in which the employees come to know about the deposits and balance made in the last 3 months, with the help of which EPFO determine about the EMI. Also, the employee has to mention the name and other details about the bank or any housing society to whom the certificate is being issued.

Download (PDF, 273KB)


Annexure II form

After the first form, EPFO issue another form showing the balance and the amount deposited in the account in last 3 months.


Annexure III form

If any of the members is willing to use the PF account to pay the EMIs, then along with annexure I form, an authorization by the member is to be filled.

Download (PDF, 300KB)


In the case of leaving a job

The clear sign has been made by the EPFO that if the employee leaves the service, the member is then completely responsible for repaying the loan. EPFO will not act as a third party in any case between the society and the member. EPFO will not be liable for any kind of payments then. Also, in the case of provident funds, the employee must arrange the funds on his own to complete the EMIs.

Already existed rules

According to the existing rules for purchasing of a house from any builder, the minimum time period of membership required is 5 years. Also, the limit of withdrawal from the PF account is wages of 36 months or the share of employee and employer plus interest or total cost, whichever is less.

RERA Takes Real Estate Sector to the Another Level

The real estate sector enters into the next level and became more effectual in all over the country. It got its own regulator from May 1, 2017. All the states and Union Territories in India will have its own Regulatory Authority (RA) which will make rules and regulations as per the amendments to the Act. But, unfortunately, till few of the states haven’t notified the rules in their state and many have not yet established a Regulatory Authority too. Few of the states have even reduced some of the provisions of the Act.

Till May 1, 2017, only 13 states and Union territories had notified their final rules. And it has been said that if the states will not establish the regulatory authority, the government will designate any officer or most probably the secretary of housing department.

Real Estate Regulatory Agencies (RERA) came to help the buyers to get their own property at the right place and at a right time.


About Advertisements made by the builders

When the projects get over then the builders were supposed to get the completion certificate and occupancy certificate and the selling of the property would take over the next step through advertisements. It has been declared that suppose if completion certificate is to be given in 3 months from the starting date, then the builder should have to register if they want to sell the property post-May 1, 2017

In the projects which are going on or are in the process, the builder can advertise but with the permission of state government. As in Maharashtra RERA, the section 3 of the Act suggests that registration is must until and unless they are not allowed to advertise the projects or sell, market, offer it one or the other way. And they have got only 90 days to book without obtaining a registration number.

Projects which are being worked on

The promoter of the project is required to apply for registering the incomplete projects within a period of 3 months from the date of commencement of the Act which is applicable to all the projects which are going on or being worked on or for which the completion certificate has not been issued as on the date of commencement of this Act.

Also, even if the properties are booked earlier but not got the possession yet, then it should be first registered by the RERA.  And in this case, the promoter or the builder or the seller is required to give a revised date of completion which should be equivalent to the amount of development completed.

How REITs and InvITs will be a game changer for Indian real estate and Infra sector.

How in some states the ongoing project is not considering RERA?

The ongoing project simply means the project which is in the process of their completion or the project whose certificated are not yet issued. These exclude the projects which attain the following point of reference:

  • It may be the state where common areas and facilities have been handed over to the association of allottees or the competent authority, suppose for maintenance of the areas.
  • Where sale or possession letter of minimum 60 of the apartments in the project have been carried out.

More than 4 lakh Pune flat buyers are victims of the builders

How to register for ongoing projects?

The builder or the promoter of an ongoing project has to requisitely register it within 90 days from the date of commencement of the Act in the state and must give the following details:

  • The promoter is required to give every detail to the Regulatory Authority about the total amount collected from the allottees and the total amount spent till now and the total balance left to him.
  • The running status of the project that is development till date and the pending information should be provided by the promoter.
  • The promoter must open up about the exact size of the apartment based on carpet area even if sold on any other basis such as super area, super built up area, built up area etc.
  • The promoter has to deposit 70% of the amounts already collected from the allottees but not been utilized for construction of the project or the land cost for the project in the different bank account.

Always ensure it as a builder

 Firstly the thing which any builder must ensure that the ongoing projects in the state are been registered by RERA or not. If not, it shouts immediately get registered.

Then the builder should check the required completion date and the date of commencement of the project so that proper certificates would be provided.

HUDCO IPO Review and Market premium

Housing and Urban Development Corporation Ltd (HUDCO) is a company which is owned by the Government and has more than 46 years of experience in providing loans for housing and urban infrastructure projects in India and was established in 1970.

HUDCO IPO presents long-term finance for construction of houses and to take on housing and urban infrastructure development programs. Also, HUDCO propose consultancy services, encourages research and studies and help spread use of innovative technologies, local building materials which are cost-effective.

HUDCO also offers loans for housing projects like urban and rural housing, co-operative housing, community toilets, slum up gradation, staff housing, repairs and renewals, private sector projects, land acquisition, and housing programs. They also offer take out finance for housing and infrastructure projects to state government, public agencies, and private corporate sector agencies.

As on 31st of December 2016 it had an outstanding loan portfolio of around Rs. 36386 crores out of which around 30.86% was for housing sector and the rest of infrastructure. 89.93% of the total loan was to state governments and their agencies.


HUDCO is all ready to play a very important role in Pradhan Mantri Awas Yojna (PMAY) under Housing for All (HFA) by the year 2022 and thus has bright prospects going forward. It will have synergy with National Housing Bank for doing the needful in this segment. With Pan India presence, company is set to explore growth potentials.

Issue Details

  • Issue Open: May 8, 2017
  • Issue Closes: May 11, 2017
  • Issue Type: Book Built Issue IPO
  • Issue Size: 204,058,747 Equity Shares of Rs 10 aggregating up to Rs 1,224.35 Cr
  • Face Value: Rs 10 per Equity Share
  • Issue Price: Rs 56 – Rs 60 per Equity Share
  • Market Lot: 200 Shares
  • Minimum Order Quantity: 200 Shares
  • Minimum Investment: Rs 14,400 on lower price band
  • Leading Managers: IDBI Capital, ICICI Securities, Nomura Financial
  • Listing At: BSE, NSE

HUDCO IPO – Schedule

05th May : Anchor Investors subscription
08th May – Offer Opens
10th May – Bank Holiday for Buddha Pournima
11th May – Offer Closes
17th May – Finalisation of Basis of Allotment
18th May – Unblocking of ASBA
19th May – Credit to Demat Accounts
19th May – Listing on NSE & BSE

Company Promoters

The President of India promotes the company and is acting through the Ministries.


Object of the issue

The objects of the issue are mentioned below:

  • To bring off the disinvestment of 200,190,000 Equity Shares by the Selling Shareholder including 10% of the Company’s pre-Offer paid up Equity Share capital Company.
  • To achieve the benefits of listing the Equity Shares on the Stock Exchanges.

DMart IPO ( Avenue Supermarts ) Review and current market premium

Financial Details

  • The total revenue generated by the company for the year end March 2012 was Rs 2,778 Crores and that of year end March 2016 is Rs 3,302 Crores.
  • The company gained a huge profit of Rs 621 Crores and Rs 775 Crores on the year end of March 2012 and March 2016 respectively.
  • The recapitulated basic EPS for the ending of financial year March 2016 is Rs 3.87 and those from the last 3 years was Rs 3.83

Reasons to invest in HUDCO IPO

  • It consists of good margins of more than 22% in the last 5 years.
  • It has a high credit rating, access to diversified and lower cost funding.
  • It has a Pan-India presence in state government projects and has a strong bond with State government and their agencies.
  • It sets up the track record, profitable since the establishment and has strong financial status.
  • It has an experience of senior management team and has a long list of skilled and professional employees.

Reasons not to invest in HUDCO IPO

  • In the last 5 years the growth rate in revenue is just 4.4% which is very low. So, you may not expect the high growth rate in the future days.
  • HUDCO IPO would not be able to foreclose on their loans on timely basis if their borrowers default on their obligations.
  • They must not be able to secure funding on commercially acceptable terms and at competitive rates which could have a bad affect on its business and results of operation
  • If the interest rates are volatile then it affects the business, net interest income and interest margin.
  • If there is an advancement in the level of its non-performing assets in the company outstanding loans then it results in the bad affect on the operations and financial conditions.

Current Grey market premium

GMP Rs. 28.00 to 28.50 and  Kostak Rs.1150 to Rs.1250/-


Investors may consider investment for medium to long term.


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.


IRB InvIT Fund is commonly a registered Infrastructure Investment Trust which comes under the InvIT Regulations. At first they aim to own, operate and maintain a portfolio of six tolls – road assets in the Indian states of Maharashtra, Gujarat, Rajasthan, Karnataka and Tamil Nadu. These toll roads are operated and maintained further by NHAI.

It is one of the largest infrastructure development and construction companies in India in terms of net worth in the roads and highways sector according to the NHAI’s annual prequalification for public-private partnerships in national highway projects report for 2015.

Issue Details

  • Issue Opens: May 3, 2017
  • Issue Closes: May 5, 2017
  • Issue Type: Book Built Issue IPO
  • Issue Size:
    • Fresh Issue of [.] Equity Shares of Rs 10 aggregating up to Rs 4,300.00 Cr
    • Offer for Sale of 34,761,770 Equity Shares of Rs 10 aggregating up to Rs [.] Cr
  • Face Value: Rs 10 Per Equity Share
  • Issue Price: Rs 100 – Rs 102 Per Equity Share
  • Market Lot: 10000 Shares
  • Minimum Order Quantity: 10000 Shares
  • Listing At: BSE, NSE

Lead Managers

IIFL Holdings Ltd., IDFC Bank Ltd., Credit Suisse Securities (India) Pvt. and ICICI Securities Ltd. are the lead managers.


IRB InvIT Fund had already raised Rs 2,094 Crore from Anchor investors.

Object of the Issue

 The following are the objects of the issue:

  • Investment in the Project SPVs by way of an issue of debt
  • General purposes
  • Issue related expenses

Financial details

  • The finances cannot be compared as it can be contemplated the same as the New Fund Offer (NFO).
  • The total revenue generated by the company at the year end March 2014 was Rs 762 Crores and at the year end, March 2016 was Rs 1,003 Crore.
  • The loss of Rs 47.5 Crores was suffered by the company in the year end March 2014 and loss of Rs 76.3 Crores in March 2016.


It has been allotted a rating of CARE AAA (Is) stable by CARE ratings indicating an opinion on the general creditworthiness of the trust and has not rated the Units of the Trust.

India Ratings has assigned IND AAA Outlook Stable to Trust’s external senior debt reflecting combined credit quality of the underlying assets and has not rated the Units.

How REITs and InvITs will be a game changer for Indian real estate and Infra sector.


  • IRB Infrastructure to raise Rs 4,930-5,035 crore via InvIT fund.
  • The units will be offered in the range of Rs 100-102 apiece.
  • The offer will also consist of a fresh issue worth Rs 4,300 crore and an offer for sale of 34.6 crore units at the upper end of the price band, with a greenshoe option that allows the InvIT to retain over-subscription of 25% of the issue size.
  • Three-fourths units out of the total are reserved for institutional investors and the remaining units for non-institutional investors.
  • Bids can be made for a minimum of 10,000 units and in multiples of 5,000 thereafter.


In the case of a decrease in tax these factors like a hike in fuel prices, a hike in toll fees and a decrease in frequency of travelers would be affected more and due to this, there would be a bad impact on the business prospects, financials and results of operations.

Another risk changes in tax benefits for InvITs.

And the other risk would be inflation, which increases the operational and maintenance costs and will have a bad effect on the financials.

Dividend policy where investors may get rewards

  • Minimum of 90% of the cash flow which can be distributed of the SPV shall be distributed to the InvIT in proportion to its holding in the SPV.
  • Minimum 90% of the cash flow must be distributed to the unit holders.
  • Within 15 days of the declaration of dividend, is should be paid. And the distributions to the unit holders are made after every 6 months.

Reasons to invest in an IRB InvIT Fund IPO (Positive Points)

  • It has diversified road project portfolio and revenue base.
  • It has experienced management team with industry experience.
  • It has higher growth opportunities and access to Sponsor’s portfolio.
  • It is the first company to get approval from SEBI under InvIT.
  • The trust has good credit rating.

Reasons not to invest in an IRB InvIT Fund IPO (Negative Points)

  • It is not clear that how one would get the invested amount back after a particular time period suppose 15-20 years.
  • They do not have carried out conclusive documents regarding the formation of transactions, the debt financing agreements, the ROFO/ROFR Deeds, and the Future Asset Agreement.


IRB Infrastructure attempt to find an enterprise valuation of Rs 7,900 crore in its prospectus, but lowered it to Rs 5,924 crore for listing, a 16% discount to the independent valuation.

But according to the report, InvIT listing will get the company Rs 1,700 crore in advance and will allow it to repay Rs 3,300 crore of debt. It will slow down its net debt by Rs 5,000 crore and bring down its debt to equity ratio to 1.8 times from 3 times. The secured debt of the company will also go down to approximately 16% to Rs 12,600 crore from its March 2016 level.


In spite of the fact that InvIT is the trust where the minimum amount to be invested is Rs. 10 lakhs, the investors may get ready to invest in this for their long term investment depending on their asset allocation and risk.


No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here.