JUST THE RIGHT FUND

MUTUAL

FUND

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Presenting Mega Mutual Fund-1 One of a kind

fund which targets long term capital appreciation

investing predominantly in equity and equity

related instruments and partly in fixed income

securities. The fund’s philosophy is not to mirror

the NEPSE but to generate profit by diversifying

investment in just the right number of companies

to make sure that the fund’s return beats the

market returns - ALWAYS.

That is why, we call it Just the right fund not just

for new entrants but for share market veterans as

well!

To generate long term capital appreciation by

investing predominantly in equity and equity

related instruments and fixed income securities as

allowed by prevailing rules of SEBON.

FUNDSUPERVISORS

Worked in different capacities in auditing,

banking, consultancy for the past 30

years. He is currently involved as a

financial sector advisor for various

national and international projects.

Anal Raj BhattaraiCA

Worked as a Professor for Law and Legal

Practices from 2031 BS, appointed as

Attorney General in the year 2066-67 and

has more than 47 years of academic

appointed as a judge of supreme court

from 2067 - 2070.

Bharat Bahadur KarkiPhD. (Commercial Law)

Worked as Executive Director with 30

years of experience in Nepal Rastra Bank

in Regulation and supervision, foreign

exchange and financial management

department.

Sarita AdhikariMBA

Mr. Pandey has worked for the

Government of Nepal and has over 24

years of experience working in several

ministries including Local Development,

General Administration, Information and

Communication, Labour and Transport

Management and National Planning

Commission. He also served as the

chairman of NTC, Sajha Yatayat, Radio

Broadcasting and Development

Committee.

Yubraj PandeyMA (Economics)

Worked as a Professor of Economics

(Tribhuwan University) for more than four

decades. Dr. Pyakurel holds a PhD. and

has completed several post-doctoral

research in Economics from notable US

universities. He also served as an

Ambassador of Nepal for Sri lanka and

Maldives. He also served as member of

the board of Nepal Rastra Bank.

Bishwambhar PyakurelPhD. Economics

OBJECTIVE OF THE SCHEME

FUND SPONSOR

FUND MANAGER / DEPOSITORY

WHAT IS MEGA MUTUAL FUND-1 ?

Why MegaMutual Fund-1 ?

1. Right amount of diversification

Currently, majority of mutual funds have exposure of around 60 - 70 companies which is around 35% of the total

regularly traded companies. Such over diversification dilutes the benefit of the diversification, so we will be

focusing on not diluting the benefits of diversification with right number of companies in our portfolio. Generally

20 - 25 would be a suitable range of diversification so as to earn the benefit of diversification without diluting the

earnings. So our focus is not to replicate NEPSE index, but to precisely choose companies with high probability

capital appreciation in our portfolio.

At present, we see high correlation between NAV of mutual funds and NEPSE INDEX. With the right amount of

diversification and dynamic assets allocation shifts, we aim to reduce the correlation among INDEX and NAV

down in our Mutual Fund. A strategy that would not shy away from setting stop loss if in case required, so that

the risk of downfall would be minimized.

2. Investment decision making

Our investment decision making would not just be limited to Fundamental and Technical Analysis but also would

include the aspect of Behavioral Finance as well. Nepalese stock market is not efficient in the weak form so

behavioral biasness prevails and has seen to be impacting the market movement. So we would be identifying

and analyzing these trends and their impact on human decision-making which ultimately reflects on the stock

market.

3. New fund mixed with experienced team

Though it is our first Mutual Fund Scheme under Mega Mutual Fund, the team managing the fund (those mainly

involved in decision making) are experienced professionals with extensive expertise in mutual funds and

investments in Nepalese stock market. The learnings from the previous experience of leading large fund

management in merchant banks and investments in NEPSE will aid the team to streamline the fund

management process in a different, dynamic yet effective manner.

4. Capital appreciation focused fund

Our fund management strategy is one of the most aggressive of strategies as our asset allocation is maximum

10% in fixed income securities and 5% in call deposit with majority remaining invested in the market. Currently,

the existing mutual funds allocate as much as 20-30% of assets to the fixed income securities causing the

evident low return of their schemes. With Mega Mutual Fund-1, as majority of the fund will be invested in stock,

the risk might be perceived as high by the market. However, we would be diversifying our portfolio and would

not hesitate from setting various stop loss requirement, which is practiced internationally but uncommon in

Nepal so far. The market cycle is expected to be bullish for next few years and early entry at this bullish cycle

would pave a strong path for the entire 10 years of the mutual fund life for long term investors. Our investment

decision-making with various aspect in itself would aid to the investment allocation being made strategically and

dynamically.

Investment Decision MakingProcess

Macro-Economic Research PESTEL Analysis

Behavioural Study

Industry Analysis

Company Research / Valuation

Track changes, events and

announcements on a

regular basis

Understanding how investors

are perceiving the market as

well as their bias.

Porter’s 5 Forces, Industry Size,

Scope, Growth, Cycle, Distribution,

Penetration Level, Opportunities,

Threats and Regulatory issues etc.

Selection of Industry

with potential

Filter good companies

within the industry by

criteria like PE, PB,

Net Worth, Market

Share etc.

Data and performance of

company to be compared

with other company or

industry average.

Analyze financial performance and position

from at least past 5 years and quarterly

reports.

Key Information – ROE, ROA, Net growth,

revenue growth, profit growth, profit

margins, source of revenue, existing and

new contracts won/lost, cash flows and

profit generation etc.

Management Capabilities, corporate

governance, company’s strategy and its

plan, SWOT .

Latest GDP growth rate, monetary policy,

fiscal policy, interest rates, liquidity,

published quarterly financials, other news.

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FundTechnicalities

Asset Allocationand Risks

L

ow

Low

Moderate

Moderate Moderate H

igh Hig

h

Riskometer

Equity

75%-85%

Cash / Call Money

5%-15%

Fixed IncomeSecurities

10%

Normal Asset Allocation

Nature of the Scheme

Fund Name

Scheme Name

Investment Objective

Corpus

NFO Price Per Unit

NFO Unit

Minimum Unit to Apply

Maximum Unit to Apply

Maturity

Allotment of Units

Dividend Payout Strategy

Fund Sponsor

Fund Sponsor Rating

Fund Manager and Depository

Fund Manager’s Rating

Close End Equity Fund

Mega Mutual Fund

Mega Mutual Fund - 1

To generate long term capital appreciation by investing predominantly in equity & equity

related instruments and partly in fixed income securities as allowed by prevailing rules on

mutual fund

NPR 1 Billion (Bio). Corpus amount may reach a maximum up to 1.25 Billion

(25% more) if oversubscribed as allowed by prevailing rules

NPR 10

100,000,000 Units

100 Units

10,000,000 Units

10 Years from the date of allotment of units (the assets under the scheme post 10 years

will be redeemed and the realized cash will be distributed in proportion to investments as

per prevailing rules

As per Securities Allotment Directive, 2068

Dividend will be paid out of net profits in proportion to investments made, retained earnings,

if any, will be re-invested

Mega Bank Nepal Limited, who will be investing 15% seed capital into the fund

“[ICRANP-IR] BBB+’’ (pronounced ICRA NP issue rating triple B plus) moderate degree

of safety regarding the timely servicing of financial obligations

Mega Capital Markets Limited

“[ICRANP] AMC Quality 3 (AMC3)” provide Adequate assurance on management quality

FundProjections

Dividend Payout

NAV per Unit

Return on Investment

21.00%

21.50%

22.50%

22.00%

21.53%

22.17%

22.41% 22.41%

22.56% 22.61%

22.46%

22.31% 22.30% 22.30%

Mega Capital

Mega Capital Markets Limited is a 100% Subsidiary of Mega Bank Nepal Limited, one of the leading

commercial banks of Nepal. Mega Capital Markets Limited is licensed by Securities Board of Nepal to

operate as a Merchant Banker. The range of service provided by Mega Capital includes Portfolio

Management, Corporate Advisory, Depository Participant, Underwriting, Issue Management, RTS / RTA and

Mutual Fund. Mega Capital has a team of highly experienced and dynamic professionals who have a proven

track record in the Investment Banking and Merchant Banking Industry.

Key Management Team

Board of Directors

Mr. Ishwar Bahadur Gurung is the Founder Promoter of Mega

Bank Nepal Limited and has been instrumental in the set up of

the Bank. He has decades of experience in Business

Management and Leadership. Currently he is engaged as the

Principal of Moonlight Higher Secondary School.

Mr. Ishwar Bahadur GurungChairman

16 years of national and international

experience in investment, finance,

auditing and management with more than

8 years’ experience in the Nepalese

Capital Market.

Mr. Sabir Bade Shrestha CEO, ACCA, EMBA

11 years experience in investment,

finance and auditing with 5 years plus

experience in Nepalese Capital Market.

Mr. Shulav ShresthaCIO, FCCA, EMBA

4 years’ experience in accounting,

auditing and advisory.

Mrs. Ibika AdhikariIncharge - Accounts / Advisory, CA (Inter)

Mr. Pokharel is serving at Mega Bank

Nepal Limited as Senior Deputy General

Manager and has been associated with

the Bank since its inception. He has

completed his MBA and has more than 24

years of experience at management level

in banking sector.

Mr. Tulsi Ram PokharelDirector

Mr. Shrestha is serving at Mega Bank

Nepal Limited as the Legal Head. He has

completed his L.L.M. and more than 12

years of experience in legal department of

various BFIs.

Mr. Dilli Ram ShresthaDirector

Mr. Paudel holds a doctoral degree in

Economics from the Australian National

University (ANU) and currently works as

an Associate Professor at the Central

Department of Economics of Tribhuvan

University. Dr. Paudel has extensive

teaching, research, and management

experience in Nepal and Australia.

Dr. Ramesh Chandra PaudelDirector

Mr. Bhattarai is an Advocate / ADR

practitioner in IB Law Associates and

completed L.L.M. Commercial Law &

Constitutional Law from TU. He is

currently Vice President of Nepal Bar

Association. He has been involved in legal

practice since 2050 B.S.

Mr. Ishwori Prasad BhattaraiDirector

MUTUAL

FUND

To apply login to your Meroshare account or contact your C-ASBA bank.

Saket Complex, Tripureshwor, Kathmandu

+977-1-5362790, 5362772

info@megacapitalmarkets.com | www.megacapitalmarkets.com

Licensed by SEBON to do issue management, underwriting, RTS/RTA,

porftolio management, corporate advisory & Mutual Fund.

*Mutual Funds are subject to market risks. Read all scheme related documents carefully.