What are Midcaps?

Why Midcaps are must in your portfolio?Data as on 31 Dec 2019. Source: AMFI; Bloomberg

Data as on 28th Feb 2020; Source: MFI Explorer. Past performance may or may not be sustained in future. Data for Nifty Midcap 100 TRI is available from Jan 2003; hence the above analysis isdone from the inception of index. For illustration purposes only. Expenses have not been considered. The market movement depends on various factors and hence it cannot be assumed that the correction is over. Investors are requested to note that Midcap performance is cyclical in nature. The above simulation is for illustration purpose only and should not be construed as a promise on returns and safeguard of capital. This should not be construed as a guarantee or forecasting of any returns.

Midcaps have potential to generate wealth in long-term

High growthpotential

HigherVolatility

Maturebusiness

Longevity

Market cap rangefrom `8,243 Crsto `26,288 Crs

LargelyEnterpreneur driven

Leader insmaller sectors

Niche players inestablished sector

SmallCaps

LargeCaps

The Midcaps‘Sweet Spot’

2.17Crs

Invest in tomorrow’s potential leaders, today.

LowerVolatility

`

1.29 Crs``Growth of `10 Lakh

Investment of `10 Lakh

0

500

1000

1500

2000

2500

3000

Nifty 50 TRI

Nifty Midcap 100 TRI

Why Midcaps now?

Investment Strategy

Historically, midcaps have bounced back after corrections

Data source: NSE; Data as on 28th Feb 2020. Past performance may or may not be sustained in future. The market movement depends on various factors and hence it cannot be assumed that the correction is over. Investors are requested to note that Midcap performance is cyclical in nature. The above simulation is for illustration purpose only and should not be construed as a promise on returns and safeguard of capital. This should not be construed as a guarantee or forecasting of any returns.

Midcap Outperformance as compared to Nifty 50

71%

15%

-1%-7% -6%-11% -12%

-19% -17%

12% 11%19%

6%

23% 25% 25%1%

4% ?2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

2021CYTD

2020CYTD

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. Sectors stated above should not be construed as recommendation from Principal Asset Management and/ or Principal Mutual Fund. The schemes of Principal Mutual Fund may or may not hold any position in these sectors. The views given above may change from time to time.

What next?

Introducing

Investmentopportunities

Addition to Product o�ering

Play on premiumization and changing consumption pattern

Technology and Innovation in products and process

Identify early stage of change in business/industry cycle

Improvements in business environment or Company fundamentals

Cost control measures and Operational e�ciencies

Product rationalization and innovation

Change in Management

Changing regulations

Balance sheet restructuring

Emerging Sectors

Currently India is poised for numerous such opportunities in spaces like:

Insurance Healthcare Renewable Energy Asset/Wealth Managers Migration to Electric Vehicles

Movie Exhibition Organized RetaileCommerceFin-Tech Logistics

Corporate action, Mergers and Acquisitions opportunities

Identifying intrinsic value opportunities

Value Migration

Value UnlockingTurnaround/Business Restructuring

New Age Economy

Why Invest in Principal Midcap Fund?

Top 10 Holding

Top 5 Industries

Marketcap Breakup

Midcap has potential to outperform Large cap in long-term

Aims to invest in emerging leaders with potential growth

Recent correction in Midcap sectors o�er opportunity for allocation % Favorable valuation as Midcaps are trading

below their long-term averages

Risk management embedded in portfolio to mitigate volatility

Experience & expertise of picking successful stocks

Top 3 Overweight Top 3 Underweight

Mid Cap

Small Cap

Cash & Other

Large Cap

67.7017.71

4.929.67

AUTO Chemicals PetroleumProducts Finance Healthcare

Services Software

Bayer Cropscience Ltd.2.22%

Voltas Ltd.2.37%

Whirlpool of India Ltd.2.37%

City Union Bank Ltd.2.38%

Tata Consumer Products Ltd.2.42%

AU Small Finance Bank Ltd.3.05%

Abbott India Ltd.3.05%

The Federal Bank Ltd.2.69%

Max Financial Services Ltd.2.48%

Kajaria Ceramics Ltd.2.44%

Fund Facts (As on 29th Feb, 2020)

Banks11.90

Finance8.92

Pharmaceuticals8.02

Consumer Durables7.25

Auto Ancillaries6.37

To generate long term capital appreciation by predominantly investing in equity and equity related instruments of Midcapcompanies. However, there is no assurance or guarantee that the investment objective of the Scheme will be achieved.

Investment Objective

Fund Details

Investment PlanDirect & Regular Growth & Dividend

Investment OptionsNifty Midcap 100 TRI

Benchmark

Associate Fund ManagerMr. Sudhir Kedia has over 13 years of experience in research and asset management business

Fund Manager Mr. Ravi Gopalakrishnan has over 25 years of experience in research and asset management business

Minimun Application AmountSystematic Transfer Plan: Minimum Six installmentsof ` 1,000/- eachRegular Withdrawal Plan: Minimum Six installmentsof ` 500/- each

New Investor – ` 5,000/- for both Dividend and Growth Optionand any amount thereafter under each Plan/OptionSystematic Investment Plan: Minimum twelveinstallments of ` 500/- each

If redeemed/ switched on or before 365 days from the date ofallotment: Nil for redemption/ switch out of units up to 20% ofthe units allotted (the limit)

1% on redemption in excess of 20% of the limit statedabove-Redemption of units would be done on First inFirst out Basis (FIFO)

Nil thereafter

Load Structure

Distributed by:

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 advisedto consult their Investment advisors for determining their risk appetite and Tax Advisor before taking any investment decision.

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

Principal Midcap Fund

This Product Is Suitable For Investors Who Are Seeking~-

• Long term Capital Growth

• Investment in equity and equity related instruments of midcap companies

(An open ended equity scheme predominantly investing in mid cap stocks)

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