Invesco India Treasury Advantage Fund

Invesco India Treasury Advantage Fund

(An open ended low duration debt scheme investing in instruments such that the Macaulay

duration

^

_{of the portfolio is between 6 months to 12 months)}

Suitable for investors who are seeking*: • Income over short term

• Investment in debt and money market instruments

* Investors should consult their financial advisers if in doubt about whether the product is suitable for them

^Please refer to the heading ‘C. Asset Allocation Pattern’ under Section ‘II. Information

about the Scheme’ of Scheme Information Document where the concept of Macaulay duration

3.69%

3.76%

4.78%

4.77%

5.21%

5.77%

3.00%

3.50%

4.00%

4.50%

5.00%

5.50%

6.00%

6.50%

Sep-20 Oct-20 Nov-20 Dec-20 Jan-21 Feb-21 Mar-21 Apr-21

Y

ie

ld

s

1 Year G-Sec

3 Year G-Sec

5 Year G-Sec

Benign liquidity

Variable reverse

repo

Post Budget & MPC

Current scenario

Source: Bloomberg. BPS: Basis point

Disclaimer: The purpose of the above chart is to explain yield movement during the aforesaid period. The information alone is not sufficient and shouldn’t be used for the development or

implementation of an investment strategy. It should not be construed as investment advice to any party.

G-Sec yields movement

Interest rates movement over past few months

Source: Invesco Asset Management (India).. Data as at 30 April 2021

3

RBI has been market supportive with accommodative monetary policy stance

Inflation fears

RBI to overlook current high inflation as transitory. To

maintain accommodative stance as long as necessary

to sustain durable growth.

Huge Govt Borrowings

RBI has for the first time announced a calendar of

G-Sec buying program.

Increased the held to maturity limit for banks to

increase demand for G-Sec.

Systemic Liquidity surplus

RBI has maintained net surplus liquidity.

Very high term premium

RBI has been actively managing the yield curve to

ensure an orderly evolution of the yield curve.

RBI’s pivotal role

Source: RBI Monetary Policy/Governor Statement, IAMI views. MPC: Monetary Policy Committee. GSAP: Government Securities Acquisition Programme. MSME: Micro, Small and Medium Enterprises.

MPC Policy measures

Delivery status

Continuation of the policy stance

Dovish policy with status quo on rates and continuation of accommodative stance.

Policy stance changed from time-based approach to state-based approach.

Focus on supporting durable economic recovery given uncertainty created by sharp resurgence

in Covid-19 cases while ensuring that inflation remains within its stipulated target.

Reassurance of maintaining ample

liquidity

MPC remains committed to ensure ample system liquidity in consonance with its accommodative

Stance.

RBI’s G-SAP 1.0 of Rs 1 lakh crores and another Rs 50,000 crores of credit line to financial

institutions will add to the durable liquidity during the year.

Prompt action with new set of

measures amid the recent resurgence

of Covid-19 cases

Shows the readiness of RBI to act proactively to control the impact on nascent economic recovery.

Several liquidity and restructuring measures to provide emergency relief to small borrowers, MSMEs

and extend funding to healthcare sector under priority sector lending.

Focus on yield management

Focus of the policy on the yield management and to ensure the orderly evolution of the yield curve by

addressing the market concerns.

•

RBI will continue to play the pivotal role to support economic growth through various measures including its

accommodative policy stance & commitment to keep systemic liquidity in surplus

•

Ample systemic liquidity and favorable demand-supply dynamics remains supportive of the short-end of the yield curve.

•

We feel that 1-4 years segment of the yield curve continues to provide attractive opportunity from risk-reward perspective.

•

Long end of the yield curve gets supported by the active yield management by RBI through the G-SAP 1.0.

•

Credit dispersion will continue with very high-quality credits benefitting from RBI’s benign liquidity policy but the lower

quality credits continuing to be avoided for the time being.

•

Inflationary risks can emanate from supply side disruption and rise in international crude oil prices and poses risks to policy

stance. We believe, RBI is cognizant of the risk factors on inflation and will embark upon a gradual exit from loose

monetary policy depending upon the sustainability of the growth recovery.

5

LHS chart- Source: Worldometer. Middle and RHS chart - Source: Nomura research report as on 27 April 2021.

Daily new cases vs recoveries in India-worsening trend since April 2021

Oxford COVID-19 Government Response Tracker

Nomura India Business Resumption Index

4.46%

3.76%

3.50%

3.25%

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

F

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2 year G-sec

1 Year G-Sec

6 months T-Bill

Overnight Rate

Spreads:

2 year G-sec over overnight rates:121 bps

1 year G-sec over overnight rates: 51 bps

6 months T-Bill over overnight rates: 25 bps

Source: Bloomberg. Data as at 30 April 2021.

Disclaimer: The purpose of the above chart is to explain movement of g-sec yields vs overnight rates. The information alone is not sufficient and shouldn’t be used for the development or

implementation of an investment strategy. It should not be construed as investment advice to any party.

G-sec movement vs overnight rates

7

Source: Bloomberg. Data as at 30 April 2021.

Disclaimer: The purpose of the above chart is to explain spread of g-sec over overnight rates. The information alone is not sufficient and shouldn’t be used for the development or

implementation of an investment strategy. It should not be construed as investment advice to any party.

Current spread: 51 bps 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% F eb -19 Ap r-1 9 J u n-19 Au g -1 9 O c t-19 D ec -19 F eb -20 Ap r-2 0 J u n-20 Au g -2 0 O c t-20 D ec -20 F eb -21 Ap r-2 1 S pr ead ( %)

1 year Gsec over Overnight rate

Average spread

Average spread: 67 bps

Spread of 1 year G-Sec vs Overnight rate

Current spread: 121 bps

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

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1

2 year G-sec over overnight rates

Average spread

Average spread: 105 bps

Spread of 2 year G-sec vs Overnight rate

Spread of 1 / 2-year rates over overnight rates are at relatively higher level

(Contd..)

Portfolio data as on April 30, 2021. 1_{Yield to maturity should not be construed as minimum return offered by Scheme. Disclaimer- The above positioning is based on our current views &}

market conditions and are subject to change from time to time.

. ₉

Top 10 Holdings

Instrument Type

% of Net

Assets

Reliance Industries Limited Corporate Debt 6.74%

8.15% GOI (MD 11/06/2022) Sovereign 6.04%

LIC Housing Finance Limited Corporate Debt 5.23%

National Highways Auth Of Ind Corporate Debt 4.76%

REC Limited Corporate Debt 4.61%

Housing Development Finance

Corporation Limited Corporate Debt

4.38%

National Bank For Agriculture and

Rural Development Corporate Debt

4.33%

Power Finance Corporation Limited Corporate Debt 4.20%

5.09% GOI (MD 13/04/2022) Sovereign 3.80%

8.35% GOI (MD 14/05/2022) Sovereign 3.78%

Total 47.88%

Portfolio statistics

YTM1 4.02%

Average Maturity 333 days

Macaulay Duration 323 days

Modified Duration 311 days

Maturity Profile

Cash & Cash Equivalent 9.74%

Rating Profile

% Exposure

Sovereign 22.76%

AAA 53.56%

A1+ 13.94%

Cash & Cash Equivalent 9.74%

Source: Invesco Asset Management (India): Disclaimer - The above positioning is based on our current views & market conditions and are subject to change from time to time. Fund- Invesco India Treasury Advantage Fund

0%

20%

40%

60%

80%

100%

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Sovereign, A1+/AAA & Cash

100% 100% 100% 100% _100% 100% 100% 100% 100%

0%

20%

40%

60%

80%

100%

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Sovereign/AAA/Cash

Credit Profile based on equivalent Long term ratings

Covid -19 second wave can further deteriorate the credit environment

Fund has a long track record of maintaining highest credit quality

Credit Profile

The above positioning is based on our current views & market conditions and are subject to change from time to time. 1_{The roll-down happens when as the maturity comes down on the}

steep yield curve, benefit of lower yield/higher price accrues to the book.

•

Presently, the fund invests in certificates of deposits (CDs), commercial papers (CPs), corporate bonds,

T-bills and government securities

•

Allocates majority of the portfolio in 6 months- 2 years space with negligible exposure to bonds beyond

2-years’ maturity.

•

Invests only in highest credit quality (AAA) rated papers; all short-term investments are in A1+

rated papers which also has AAA as their long-term rating

•

Actively manages the interest rate risk with an aim to achieve optimal returns without compromising on

credit rating and liquidity

•

Investors may benefit from the accrual and possible capital gains by roll-down

1

_{effect strategy}

11

Note: # Macaulay Duration ;

Macaulay duration of a bond is the number of years taken to recover the initial investment of a bond. It is calculated as the weighted average number of years to receive the cash flow wherein the present value of respective cash flows is multiplied with the time to that respective cash flows. The total of such values is divided by the price of the security to arrive at the duration.

Invesco India Treasury Advantage Fund- Positioning and Suitability

Low High Invesco India Liquid Fund Liquid Fund ( up to 91 days) Invesco India Ultra Short Term

Fund Ultra Short Duration Fund (3 – 6 months#₎

Invesco India

Treasury

Advantage

Fund

Short Duration (1–3 years#₎ Invesco India Overnight Fund Overnight Fund ( up to 1 business day)

Invesco India Credit Risk Fund

Credit Risk Fund

Invesco India Banking & PSU Debt Fund

Banking and PSU Fund

Invesco India Gilt Fund

Gilt Fund

Invesco India Corporate Bond Fund

Corporate Bond Fund

Duration

_{/ Maturity based}

Other Fixed Income funds

Category An open ended low duration debt scheme investing in instruments such that the Macaulay duration1_{of the portfolio is between 6 months to 12 months}

Investment Objective To generate income by investing in debt and Money Market Instruments.

Asset Allocation Under normal circumstances the asset allocation pattern will be:

2_{Debt includes government securities.}

3_{The portfolio shall have Macaulay duration between 6 months to 12 months}

Minimum Application Amount

Rs. 1,000/- per application and in multiples of Re. 1 thereafter. For Systematic Investment Plan (SIP):

Plans4_{/ Options} (Applicable to Direct Plan also)

• Growth Option

• IDCW Payout option- Weekly, Monthly, Discretionary

• IDCW Reinvestment option- Daily, Weekly, Monthly, Discretionary

(If IDCW under payout of IDCW is equal to or less than Rs.100/- then the IDCW would be compulsorily reinvested in the respective plan/option of the scheme)

Load Entry Load: Nil5

Exit Load:6_Nil

Fund Managers Krishna Cheemalapati and Vikas Garg

Benchmark CRISIL Low Duration Debt Index

Key facts

13

Instruments

Indicative Allocation

(% of net assets) Risk Profile Minimum Maximum High/Medium/Low

Debt2_{and Money Market Instruments}3 _{0% 100% Low}

Options Minimum Amount Minimum Installments

Monthly Rs. 100/- and in multiples of Rs. 1 thereafter 12 Quarterly Rs. 300/- and in multiples of Rs. 1 thereafter 4

1_{Please refer to the heading ‘C. Asset Allocation Pattern’ under Section ‘II. Information about the Scheme’ of Scheme Information Document where the concept of Macaulay duration has been explained.} 4_Direct

Plan will have a lower expense ratio excluding distribution expenses, commission for distribution of Units etc. 5_{The upfront commission, if any, on investment made by the investor shall be paid by the investor}

directly to the Distributor, based on his assessment of various factors including the service rendered by the Distributor. Benchmark based on Total Return variant of respective benchmark index. 6_{Exit Load}

* Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

^Please refer to the heading ‘C. Asset Allocation Pattern’ under Section ‘II. Information about the Scheme’ of Scheme Information Document where the concept of Macaulay duration has been explained. Note - Macaulay duration of a bond is the number of years taken to recover the initial investment of a bond. It is calculated as the weighted average number of years to receive the cash flow wherein the present value of respective cash flows is multiplied with the time to that respective cash flows. The total of such values is divided by the price of the security to arrive at the duration.

.

Product labelling

Suitable for investors who are seeking*

Invesco India Liquid Fund (an open ended liquid scheme)  Income over short term

 Investments predominantly in money market and debt instruments commensurate with low risk and high liquidity

Invesco India Money Market Fund

(an open ended debt scheme investing in money market instruments)

 Income over short term

 Investment in money market instruments

Invesco India Short Term Fund

(an open ended short term debt scheme investing in instruments such that the Macaulay duration^ of the portfolio is between 1 year to 3 years)

 Income over short to medium term

 Investments in short term debt and money market instruments

Invesco India Banking & PSU Debt Fund

(an open ended debt scheme predominantly investing in Debt instruments of banks, Public Sector Undertakings, Public Financial Institutions and Municipal Bonds)  Returns over short to medium term

 Investments primarily in debt & money market instruments issued by Banks, PFIs, PSUs and Municipal Bonds

Invesco India Overnight Fund (an open ended debt scheme investing in overnight securities)

 Income over short term with low risk and high liquidity

 Investments in overnight securities having residual maturity of 1 business day

Invesco India Credit Risk Fund

(an open ended debt scheme predominantly investing in AA and below rated corporate bonds (excluding AA+ rated corporate bonds))

 Income and Capital appreciation over medium to long term

 Investments primarily in corporate debt securities of varying maturities across the credit spectrum Invesco India Corporate Bond Fund

(an open ended debt scheme predominantly investing in AA+ and above rated corporate bonds)

 Income over medium to long term

 Investments in AA+ and above rated corporate bonds market and debt instruments

Invesco India Ultra Short Term Fund

(an open ended ultra-short term debt scheme investing in instruments such that the Macaulay duration^ of the portfolio is between 3 months to 6 months)

 Income over short term

 Investments in a portfolio of short term money market and debt instruments

Invesco India Treasury Advantage Fund (an open ended low duration debt scheme investing in instruments such that the Macaulay duration^ of the portfolio is between 6 months to 12 months)  Income over short term

 Investment in debt and money market instruments

Invesco India Gilt Fund

(an open ended debt scheme investing in government securities across maturity)  Credit risk free returns over medium to

long-term

Disclaimer: The information alone is not sufficient and shouldn’t be used for the development or implementation of an investment strategy. It should not be construed as investment advice

to any party. All figures, charts/graphs and data included in this presentation are as on date and are subject to change without notice. The statements contained herein are based on our current views and involve known/unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. The data used in this presentation is obtained by Invesco Asset Management (India) Private Limited from the sources which it considers reliable. The stocks/sectors referred in the presentation should not be construed as recommendations from Invesco Asset Management (India) Private Limited and/or Invesco Mutual Fund and the Scheme may or may not have any present or future positions in these stocks/sectors. While utmost care has been exercised while preparing this presentation, Invesco Asset Management (India) Private Limited does not warrant the completeness or accuracy of the information and disclaims all liabilities, losses and damages arising out of the use of this information. The content of this presentation is intended solely for the use of the addressee. If you are not the addressee or the person responsible for delivering it to the addressee, any disclosure, copying, distribution or any action taken or omitted to be taken in reliance on it is prohibited and may be unlawful. The recipient(s) before acting on any information herein should make his/their own investigation and seek appropriate professional advice.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

15

Get in touch

Corporate Office:

Invesco Asset Management (India) Private Limited

2101 A, 21st Floor, A- Wing,

Marathon Futurex, N.M. Joshi Marg, Lower Parel, Mumbai – 400 013 +91 22 67310000 F +91 22 23019422

To invest:

Call 1800-209-0007 ∆ sms ‘Invest’ to 56677 Invest Online www.invescomutualfund.com