Principal Balanced Advantage Fund is suitable for long term capital growth with lesser volatility in returns by diversifying investments in Equity & Debt markets. When the market are expensive, it reduces allocation to equities and move assets into cash future arbitrage / equity derivatives, debt / money market instruments and vice versa. It is suitable for an investment horizon of three years and above.

Top 5 Industry Allocation (as on October 31, 2019) Top 5 Stocks (as on October 31, 2019)

Market Valuation & Investors Response

How Principal Balanced Advantage model works?

Weighted Average PE (Standalone) of Nifty 50 Index

Valuations from Long Term Perspective

Typical Retail Investors Response

Fund’s Response

Less than or equal to 18

Above 18 – Less than or equal to 20

Above 20 – Less than or equal to 22

Above 22 – Less than or equal to 24

Above 24 – Less than or equal to 26

Above 26

Very Attractive

Very Attractive

Attractive

Reasonable

Not Attractive

Overpriced

Indifferent / Cautious

Indifferent / Cautious

Skeptic

Skeptic

Bullish

Bullish

Bullish

Bullish

Positive

Positive

Cautious

Cautious

Disclaimer: The investment strategy stated above may change from time to time without any notice and shall be in accordance with the strategy as mentioned in the Scheme Information Document of the scheme. The views contained herein are not to be taken as an advice or recommendation to buy or sell any investment or interest thereto. Reliance upon information in this material is at the sole discretion of the reader. This material should not be relied upon by you in evaluating the merits of investing in any securities or products. Diversification does not guarantee investment returns and does not eliminate the risk of loss. It should be noted that the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Past performance may or may not be sustained in future. The views and strategies described may not be suitable for all investors. Furthermore, whilst it is the intention to achieve the investment objective of the investment product(s), there can be no assurance that those objectives will be met. Investors are advised to consult their Investment advisors for determining their risk appetite and Tax Advisor before taking any investment decision.

What is PE and what does it imply?

Typically, the Price to Earnings or PE is a measure of how the earnings of a company are valued in the market.

Lower PE essentially indicates attractive valuations and vice-versa.

Source: www.nseindia.com, Internal Analysis.

£Formely known as Principal SMART Equity Fund (w.e.f. June 04, 2018)

Historical Net Equity Exposure & NIFTY PE (as on October 31, 2019)

PE Bands & Net Equity Allocation

Net Equity P/E Ratio

Weighted Average PE (Standalone) of Nifty 50 Index

Net Equity Component (%)

Less than or equal to 18

Above 18 – Less than or equal to 20

Above 20 – Less than or equal to 22

Above 22 – Less than or equal to 24

Above 24 – Less than or equal to 26

Above 26

80-100

60-80

40-60

30-50

20-40

15-25

We use the month-end Trailing PE Ratio of Nifty 50 Index to understand if the market is overvalued or undervalued or fairly valued.

Based on the current valuation, using a predefined table of PE levels we add or reduce net equity exposure in the portfolio.

Finance Banks

10.75% 10.70%

Pharmaceuticals

10.11% 8.85% 8.78%

Mutual Fund

October, 2019

An all-weather fund that auto-allocates investments between debt,equity & equity related securities smartly with an aim to help you make the most of any market.

Principal Balanced Advantage FundAn Open-ended Dynamic Asset Allocation Fund

£

`

Consumer Non Durables

9.63%

8.85%

5.78%

4.89%

4.61%

Dabur India Ltd.

ITC Ltd.

Reliance Industries Ltd.

Aurobindo Pharma Ltd.

HDFC Ltd.

Adani Power Ltd.Petroleum Products

(% of NAV) (% of NAV)

-

5.00

10.00

15.00

20.00

25.00

30.00

35.00

0%10%20%30%40%50%60%70%80%90%

100%

Jan-

11

Jun-

11

Nov

-11

Apr

-12

Sep-

12

Feb-

13

Jul-1

3

Dec

-13

May

-14

Oct

-14

Mar

-15

Aug

-15

Jan-

16

Jun-

16

Nov

-16

Apr

-17

Sep-

17

Feb-

18

Jul-1

8

Dec

-18

May

-19

Oct

-19

This communication is only for distributors, investors should refer to the one pager available on www.principalindia.com

Key Statistics (as on October 31, 2019) Dividend Update

Past performance may or may not be sustained in the future. * On face value of ̀ 10.Note: All Dividend (`/Unit) figures are Gross Dividend. Pursuant payment of dividend, the NAV of Dividend Option of schemes/plans would fall to the extent of payout and statutory levy, if applicable.

Note: ^ The above measures have been calculated by taking rolling returns for a 3 year period with 5.25% risk free rate of return (1 days - MIBOR Rate as on October 31, 2019).

AUM

`207.83 cr.

Sharpe Ratio^(Annualised)

-0.15

StandardDeviation^

(Annualised)

4.15%Beta^

0.56

Regular Plan

Dividend ( `/Unit*)

Cum Dividend

NAV

Date

October 17, 2019 0.0949 13.4700

September 17, 2019 0.0952 13.3600

August 16, 2019 0.0959 13.4800

July 17, 2019 0.0972 13.7500

June 17, 2019 0.1093 13.7900

May 17, 2019 0.1112 14.0900

April 16, 2019 0.1130 14.3400

March 15, 2019 0.1123 14.3300

Investing Facts

Plans: Regular & Direct

Options: Growth & Monthly Dividend (Payout, Reinvestment & Sweep)

Minimum Investment Amount: New Investor: ̀ 5,000 | Existing Investor: ̀ 1,000

Exit Load: 0.25% for redemptions within 7 days from the date of allotment.

[Note: w.e.f. March 01, 2019]

SIP / STP / RWP - Available

Fund Manager

Total work experience of 25 years. Managing this scheme since July, 2019

Ravi Gopalakrishnan (For Equity Portion)

Total work experience of 19 years. Managing this scheme since January, 2018

Bekxy Kuriakose (For Debt Portion)

Investment Strategy

Equity Investments Fixed Income Investments

Why invest in Principal Balanced Advantage Fund

™ This fund is suitable for long term investors seeking equity market participation with lower risk.™ The Fund aims to eliminate the worry of timing entry and exit to and from equity markets for investors.™ It is an all-weather fund with allocations to large cap equities, short term debt and derivatives that aims to deliver superior risk

adjusted returns over market cycles.

™ A large cap oriented portfolio.

™ Equity stock selection with endeavor to potentially outperform benchmark in 2-3 years timeframe.

™ Active management of the portfolio in response to dynamic market conditions.

™ Flexible rebalancing strategy.

™ Average maturity of debt portion is managed similar to a mix of Low Duration to Short Term debt fund category.

™ Endeavors to invest in high quality short term Corporate Bonds and Money Market Instruments.

™ Tactical short term trading exposure to GILTS may be undertaken.

DISCLAIMER: The investment strategy stated above may change from time to time without any notice and shall be in accordance with the strategy as mentioned in the Scheme Information Document of the scheme.

Performance of Scheme (as on October 31, 2019)

Different plans shall have a different expense structure. The performance details provided herein are of Regular Plan - Growth option. Past performance may or may not be sustained $in future. Returns (in %) are calculated on Compounded Annualised Basis (CAGR). PTP (Point to Point) Returns are based on standard investment of 10,000/- made at the beginning

of relevant period. Performance of the dividend option for the investors would be net of dividend distribution tax, as applicable.

PeriodPrincipal Balanced Advantage Fund

Returns (%) $PTP Returns

1 Year (28-09-2018 to 31-10-2019)

3 Years (30-09-2016 to 31-10-2019)

5 Years (30-09-2014 to 31-10-2019)

Since Inception (16-12-2010 to 31-10-2019)

50% Nifty 100 TRI Index + 35% CRISIL Short Term Bond Index +

15% Nifty Arbitrage Index (Scheme’s Benchmark)

Returns (%) $PTP Returns

Nifty 50 TRI(Additional Benchmark)

Returns (%) $PTP Returns

2.13 10212.66 12.61 11260.68 15.93 11592.72

4.61 11453.13 9.71 13215.70 12.66 14312.96

5.21 12890.14 8.73 15199.95 8.76 15218.30

8.51 20650.00 9.29 22014.16 9.47 22338.26

Annexure of returns for all schemes managed by fund managers (as on October 31, 2019)

3PRINCIPAL Retirement Savings Funds - Progressive Plan Benchmark - Nifty 200 Full Marketcap Index - TRI (Managing since - July 2019)

4PRINCIPAL Retirement Savings Funds - Moderate Plan Benchmark - CRISIL Hybrid 35 + 65 - Aggressive Index** (Managing since - July 2019)

5 PRINCIPAL Retirement Savings Funds - Conservative PlanBenchmark - 30% Nifty 50 - TRI + 70% CRISIL Liquid FundIndex (Managing since - July 2019)

1 Year return (%) 3 Years returns (%) 5 Years returns (%)

Scheme Benchmark Scheme SchemeBenchmark Benchmark

Funds Managed by Mr. Ravi Gopalakrishnan

1 PRINCIPAL Multicap Growth FundBenchmark - Nifty 500 Index - TRIManaging since - July 2019

Past performance may or may not be sustained in future. Different plans shall have a different expense structure. The performance details provided herein are of Regular Plan - Growth option. Returns (in %) are calculated on Compounded Annualised Basis (CAGR).Mr. Ravi Gopalakrishnan also manages Principal Balanced Advantage Fund (Equity Portion), Principal Hybrid Equity Fund (Equity Portion)and Principal Multicap Growth Fund, Principal Retirement Savings Fund (Conservative Plan-Progressive Plan-Moderate Plan) and Principal Small Cap Fund (w.e.f. July, 2019).Mr. Ravi Gopalakrishnan also manages Principal Focused Multicap Fund, Principal Dividend Yield Fund, Principal Emerging Bluechip Fund (w.e.f. October 2019).Ms. Bekxy Kuriakose manages Principal Hybrid Equity Fund - Debt Portion (w.e.f. March 2016).Mr. Ravi Gopalakrishnan manage Principal Hybrid Equity Fund - Equity Portion, Mr. Bekxy Kuriakose - Debt Portion and Mr. Ashish Aggrawal - Associate Fund Manager (w.e.f. October 2019).„Ms. Bekxy Kuriakose manages Principal Hybrid Equity Fund - Debt Portion (w.e.f. March 2016).Ms. Bekxy Kuriakose manages Principal Cash Management Fund (w.e.f. May 2019), Principal Low Duration Fund (w.e.f. May 2019), and Principal Ultra Short Term Fund (w.e.f. May 2019).1 2 3 Formely known as Principal Growth Fund (w.e.f. April 23, 2018) & Formely known as Principal Large Cap Fund (w.e.f. May 10, 2018) , Formely known as Principal Asset Allocation Fund of Funds: Aggressive Plan (w.e.f. June 11,

4 5 62018), Principal Asset Allocation Fund of Funds: Moderate Plan (w.e.f. June 11, 2018) & Principal Asset Allocation Fund of Funds: Conservative Plan (w.e.f. June 11, 2018), Formely known as Principal Money Manager Fund (w.e.f. 7May 16, 2018) Formely known as Principal Balanced Fund (w.e.f. June 11, 2018). The scheme features of Principal Balanced Fund has changed (w.e.f June 11, 2018)

** The equity component of CRISIL Hybrid 35+65 - Aggressive Index is represented by total returns variant of S&P BSE 200. ¢ Mr. Siddarth Mohta has been appointed as a Associate Fund Manager of Principal Multi Cap Growth Fund (w.e.f. August 2018) and Principal Small Cap Fund (w.e.f. May, 2019).5 years performance of Principal Retirement Savings Fund - Progressive, Moderate & Conservative Plan is not given as the scheme have not been in existence for 5 years.Note: Performance of Principal Small Cap Fund is not given as the scheme has not completed 1 year.

2PRINCIPAL Focused Multicap FundBenchmark - S&P BSE 250 Large Midcap Index - TRIManaging since - October 2019

PRINCIPAL Dividend Yield Fund Benchmark - Nifty Dividend Opportunities 50 - TRIManaging since - October 2019

PRINCIPAL Emerging Bluechip FundBenchmark - Nifty Large Midcap 250 Index - TRIManaging since - October 2019

Funds Managed by Ms. Bekxy Kuriakose

7.18 7.24 4.75 7.09 6.27 7.46

6.47 7.24 3.72 7.09 5.50 7.46

3.62 13.80 8.62 10.10 9.34 9.47

0.07 13.55 2.68 7.38 5.81 8.94

-10.16 9.44 0.71 7.83 3.77 8.32

PRINCIPAL Dynamic Bond FundBenchmark - CRISIL Composite Bond Fund IndexManaging since - January 2013

7PRINCIPAL Hybrid Equity FundBenchmark - CRISIL Hybrid 35+65 - Aggressive Index**Managing since - March 2016 (Debt Portion)

PRINCIPAL Cash Management FundBenchmark - CRISIL Liquid Fund IndexManaging since - May 2019

PRINCIPAL Low Duration FundBenchmark - CRISIL Composite Bond Fund IndexManaging since - May 2019

6PRINCIPAL Ultra Short Term FundBenchmark - CRISIL Liquid Fund IndexManaging since - May 2019

7PRINCIPAL Hybrid Equity Fund„

Benchmark - CRISIL Hybrid 35+65 Aggressive Index**Managing since - July 2019 (Equity Portion)

14.75 13.41 9.15 11.22 8.39 9.53

8.40 9.00 8.13 9.29 12.10 10.21

7.48 6.54 10.19 10.00 8.87 7.00

4.37 12.10 7.82 10.29 8.83 8.98

4.77 13.11 5.91 11.09 NA NA

4.05 13.80 5.09 10.10 NA NA

3.55 10.01 4.42 8.91 NA NA

3.62 13.80 8.62 10.10 9.34 9.47

Distributed by:

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

Principal Balanced Advantage Fund: (An Open-ended dynamic asset allocation fund)

~This product is suitable for investors who are seeking -

Ÿ Long term Capital Growth.

Ÿ Investment in equity & equity related securities including equity derivatives as well as Debt/Money Market securities through a systematic allocation of Funds between Equity & Debt on the basis of the Price Earnings Ratio of Nifty 50.

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