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UTI MUTUAL FUND

• Largest MF in the Country with AUM of About Rs.
  25228 crores (as on Dec 31, 2005)
• Equity AUM of approx. Rs 12,100 crores
• 55 Domestic Funds, 5 Offshore Funds
• 29 Equity, 24 Debt and 2 Balanced Domestic Funds
• Dedicated Equity Research Cell to assist Fund
  Managers
• Comprehensive risk management practices
• Most extensive marketing network - 67 UFCs, 340
  District representatives

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INDIAN ECONOMY STOCK MARKET
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STRONG ECONOMIC GROWTH

• India among the fastest growth economies of the
  world
• Domestically driven economy
• India Getting Younger and Richer
• Economic growth led by Consumption
• Corporate India getting Healthier
• CAPEX in a competitive environment
• Infrastructure Spending on an anvil
• Reflation Theory may work in future

Be a Winner by investing in UTI Leadership Fund
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ECONOMIC GROWTH AND EQUITY MARKETS

• During Periods of Strong Economic Growth, Equity
  Markets Perform Strongly
• Two Prominent Cases
• Domestic Investment Led Growth in the US
  A(1948-1964)
• Export Led Growth in Japan (1970-1985)
• Several Countries Have Gone Through Similar
  Inflection Periods
• Chinese Growth Led By Manufacturing Outsourcing
• Indian Growth Led By Services Outsourcing and
  Domestic Demand Driven By Increased Consumption
  and Current Low Leverage

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INDIA VALUATION COMPARABLE TO EMERGING MARKET
Global Indices YTD trends
Valuations much lower than at historic
peaks Indian economy and companies have
higher sustainable growth rates Indian economy
is relatively more insulated from a global
slowdown Indian companies have better operating
and financial parameters India is quoting at
about 14 times FY07 earnings
Relative valuations
Source Bloomberg
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LEADERSHIP CONCEPT CHARACTERSTICS
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UTI LEADERSHIP EQUITY FUND - CONCEPT

• Investing in stocks that are Leaders in their
  respective industries/ sectors /sub-sectors
• Leaders are those companies having
• Higher market shares
• Strong brand equity
• Better operating efficiencies
• Better access to capital
• Significant / sustainable competitive advantages

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LEADERS HAVE A PROVEN TRACK RECORD

• Tend to have long history of operations
• Experience of going through economic cycles
• Achieving leadership position by building
  economies of scale and Sustainable competitive
  advantage

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HIGHER DEGREE OF TRANSPARENCY

• High degree of corporate governance
• Professionally driven companies
• Management actions directed to enhance
  shareholders value
• Corporate Governance and Equity Prices by
  Paul Gompers of Harvard and Andrew Metrick of the
  University of Pennsylvanias Wharton School found
  that firms with stronger shareholder rights had
  higher firm value, higher profits, higher sales
  growth.

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MODEL PORTFOLIO OF LEADERS - A BACK TESTING

• Portfolio of Leaders
• A portfolio of leaders was constructed by
  choosing 35 companies from 34 sectors/sub-sectors
  who are leaders in the respective
  sector/subsectors.
• CNX Mid Cap Indices
• It consist of companies which are not leaders in
  respective sectors
• Stock market performance and Financial
  performance of Portfolio of leaders are compared
  with indices containing non - leaders

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LEADERS DO WELL IN RISING MARKET
CNX Midcap index (200) is discontinued after July
2005
Leaders give higher return in the rising market
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LEADERS PROTECT THE GAINS IN FALLING MARKET
CNX Mcap Index (100) is available from Jan 2001
CNX Midcap index (100) is available from Jan 2001
Leaders decline less in the falling market
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LEADERS DO WELL OVER SHORT AND LONG PERIODS
Be a winner by staying invested with Leaders
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LEADERS DO WELL COMPARED TO BROADER MARKET
Be a winner by staying invested with Leaders
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LEADERS DO WELL DURING ECONOMIC UPSWING
Rs in crores
Period of 2000-05 was marked with economic
upswing with Indias GDP has grown in excess of
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Leaders are major beneficiaries during Economic
upswing
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LEADERS - ABILITY TO WITHSTAND DOWNTURNS
Rs in crores
Period of 1995-2000 was marked with economic
slowdown after liberalization of economy in 91-92
Leaders can withstand tremors of the economy
better
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LEADERS DO WELL EVEN DURING FULL ECONOMIC CYCLE

• 1995 - 2000 was a period of slowdown while
  2000 - 2005 was period of economic upswing

Growth in sales, Op. profit and PAT of companies
in Portfolio of Leaders have been higher
compared to that of non-leaders over last ten
year period
Leaders have sustainable earnings and hence give
sustainable returns
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EARNINGS OF LEADERS HAVE LOW VOLATILITY
Sales Growth
PAT Growth
PAT Growth
Leaders have sustainable earnings and hence give
sustainable returns
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LEADERS ARE GLOBALLY COMPETITIVE

• Liberalisation of economy in 1991
• Peak custom duty cut from over 100 in 93 to
  about 20 in 2005.
• Operational and financial restructuring leading
  to higher margins.
• OPM improved for companies in portfolio of
  leaders from 6.28 in 1993 to 13.82 in 2005
• NPM improved for portfolio of leaders from
  5.05 in 1993 to 11.32 in 2005

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INDIAN LEADERS CAN BE TOMORROWS GLOBAL MNCS
Be a winner by staying invested with Leaders
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UTI LEADERSHIP EQUITY FUND
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A FUND TO CAPITALISE ON GROWING ECONOMY

• Secular underlying growth story of Indian Economy

Global Competitiveness
Leaders performing well in future
Quality Portfolio at reasonable valuations
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SCHEME FEATURES

• INVESTMENT OBJECTIVE
• Long-term capital appreciation and/or dividend
  distribution.
• Investing in stocks that are Leaders in their
  respective industries / sectors / sub-sectors.
• The investments restricted to the top five
  leading companies of an industry / sector /
  sub-sector in terms of sales turnover / market
  share.
• BENCHMARK INDEX S P CNX Nifty
• ASSET ALLOCATION

Invest in Leadership Fund from a Leader in Mutual
Fund Industry
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INVESTMENT STRATEGY

• Stock Selection
• An industry or sector that the Fund Manager
  feels will outperform others will be selected and
  then leading companies within that industry /
  sectors will be picked.
• Portfolio of the fund would be focussed
• Number of stocks around 25-30.
• To invest 75-80 in leaders and 20-25 in
  potential leaders.

Single stroke to success is being with Leaders
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FUND POSITIONING
Return
Risk
Leadership fund can give higher and sustainable
return
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SCHEME DETAILS

• Type of Scheme Open Ended Diversified Equity
  Fund
• Options Available
• Growth Option
• Dividend Option with Payout and Reinvestment
  facilities
• Sale and Repurchase Price
• During the NFO, the units of the fund will be
  sold at Rs. 10 subject to Load applicable.
• The Scheme will offer purchase and redemption of
  units at NAV based prices on every business day
  on an ongoing basis, commencing from 28th
  February 2006.
• Investment Amount
• Minimum initial investment is Rs.5,000/-.
  Subsequent minimum investment under a folio is
  Rs.1,000/- and in multiples of Re.1/- thereafter
• Facilities Available Systematic Investment Plan
  (SIP) and Automatic Trigger facilities

Be a Winner by investing in UTI Leadership Equity
Fund
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SCHEME DETAILS (Contd.)
Load Structure
NFO Opens On 9th January 2006 NFO Closes On
30th January 2006
Be a Winner by Investing in UTI Leadership
Equity Fund
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RISK FACTORS

• All investments in Mutual Funds and
  securities are subject to market risk and the NAV
  of the Funds may go up or down depending on the
  factors forces affecting the securities market.
  Past performance of the Sponsor/Mutual Fund/
  Scheme(s)/AMC is not necessarily indicative of
  the future results. UTI Leadership Equity Fund is
  just the name of the scheme and does not in any
  manner indicate the quality of the scheme, its
  future prospects or returns. The scheme is
  subjected to the risks relating to interest rate,
  liquidity, securities lending, investment in
  overseas market, trading in equity and debt
  derivatives. There may be instances where no
  income distribution could be made. Please read
  the Offer Document carefully and do consult your
  financial advisor before investing.

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INDIA AMONGST THE FASTEST GROWING ECONOMIES
Growth has been accelerating in each
decade Industry services (78 of GDP) growing _at_
8 Impact of agriculture on overall growth is
steadily reducing Per capita income has grown by
7 CAGR over the past decade and is projected to
cross 1,000 by the end of the decade
Source Var Brokerge housess
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INDIA GETTING YOUNGER AND RICHER

• Explosive effect of rising Per capita Income
  Currently at USD 750
• Historically, at 1 growth, PCI doubled in a life
  time
• At current 4 growth, PCI will reach USD 1000 in
  8 years
• PCI of top 20 of population (gt200mn people) is
  growing at 9 - doubling in 8 years

Increasing consuming group
Source planning commission of India
Young and richer India has huge implication in
terms of multiplier effect on consumption and
economic growth
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ECONOMIC GROWTH LED BY CONSUMPTION
Consumer loans/ GDP
Mortgages/ GDP
Credit cards/ GDP
Other retail loans/ GDP
Source RBI, Var brokerage house
Indian economy is domestically driven economy
(85 from dom. Mkt.) unlike emerging markets
which are linked to export growth
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CORPORATE INDIA GETTING HEALTHIER
Growing Profitability
Peak Rate of Custom Duty Operating in a
Competitive environment
Efficiently managed Working Capital/ Sales
Healthy balance sheets
Source CMIE
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CAPEX IN A COMPETITIVE ENVIRONMENT
Source CMIE
Duties (RHS)

• Key differences between the capex cycle of
  1995-97 and the current one
• Current capex in a competitive environment,
  duties down to WTO levels
• Interest rate differentials with regional
  economies have shrunk, making India more
  competitive
• Current capex also aimed at servicing export
  markets given Indias emerging competitiveness in
  manufacturing

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INFRASTRUCTURE SPENDING ON ANVIL
Infrastructure investments the key driver to
feed the imminent capex boom and drive industrial
growth to double digit
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REFLATION THEORY MAY WORK IN FUTURE
Ownership of equities
Low level of Local Investment
Ownership of equities
Source Var Brokerage Houses
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INDIA VALUATION - REASONABLE RELATIVE TO GROWTH
Sensex 9300
14.0x FY07E of Rs.668 16.6x FY06E of Rs.562
Source Bloomberg
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Dow Jones performance
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Nikkei performance