FROM THE CEO S DESK. Equity Market View. Think Investments. Think Kotak. (As on February 29, 2009) Dear Friends,

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2 FROM THE CEO S DESK (As on February 29, 2009) Dear Friends, The equity market performance continues to remain a function of FII led liquidity inflows. The key benchmark indices, Sensex & Nifty, witnessed intermittent volatile sessions in the February month, closing the period with the performance of 3.2% & 3.6% respectively. It is important to note here that this rally in the equities market since Jan-12 is predominantly led by a surge in FII inflows. FIIs have invested around US$ 7 bn in equities market since the year beginning. This FII tide may be attributable to the decline in the liquidity premium in EU (on account of LTRO facilitation), which has emboldened the institutional-money to seek out emerging market assets more assertively. At that, the benchmark-driven deployment by the country ETFs has ensured that high beta stocks rise faster. This, despite any significant change in the underlying fundamentals. While the growth in sales volumes in Q3-FY12 did surprise the market positively, the earnings were largely in line with earlier projections. Moreover, the overhang of slowing economy, volatile currency and expanding crude oil bill - limits the upside possibility of positive surprise from the economy in the next few months. In that context, the near-term performance prospects of equities market remain grounded primarily in the outcome of the election results; FY13 Union budget; and the subsequent monetary policy meeting. Given the event-driven nature of the possible performance in the next few weeks, high volatility in the market cannot be ruled out. More disconcerting has been the 6.1% yoy GDP growth in Q3 FY12, which is a major moderation from the Q3 FY11 growth rate of 8.3%. With the IIP numbers remaining lackluster at around 1.8%; and the growth in core infrastructure project calculated at 0.5% in Jan-12; the future gdp growth prospects seem to be paling further in the absence of the policy stimulus. Given this context, the market has increasingly begun to factor-in the likely CRR rate cut in March-12; followed by a repo rate cut in April-12. To add to that, the policy thrust emanating from the Union Budget also gains significance given the limited options that the government has as compared to those employed during the 2008 crisis. The budget may have to do a tight balancing act between reining in fiscal deficit (around 5.5-6% for FY2) and providing a consumption & investment boost to the economy. The government may go for reduced deficit since that may lead to relative freeing-up of the domestic savings. This would in turn reduce the long-term borrowing cost, and re-energizing the investment cycle. Moreover, the decline in fiscal deficit would be in tandem with RBI s stance, and would promote a more effective rate reversion trajectory in the year ahead. The forward motion on the impending GST and DTC, too, is anticipated in the forthcoming budget. In fact, this is an opportunity for the government to push for difficult policy reforms, since, the next budget may prove to be in the shadow of 2014 general elections. Thus, limiting government s options then. The liquidity paucity in the debt market continues to be in the Rs 180,000 cr region; with the hardened near term liquidity curve continuing to remain inverted. We believe that while the near term CRR cut and Repo rate cut may bring in structural liquidity into the system; the continued pressure on the Rupee due rising crude import bill may continue to suppress the liquidity condition for some more time. This, may even impede in RBI s likely rate reversion programme. While the cyclical downturn is an inevitable economic phenomenon; yet it also is an opportunity for the enterprising and the ingenious. Quite naturally, this apparent bottom is also an opportunity for an entrepreneurial investor to invest-in and benefit from the relatively low valuations available in the market now. Regards, Sandesh Kirkire Mutual Fund investments are subject to market risks. Please read the Information Document and Statement of Information carefully before investing. Equity Market View Indian equities market remained in the green during the February month despite the intermittent volatility from time to time. The key benchmark indices, Sensex and Nifty, posted a performance of 3.2% and 3.6% respectively during the period. The market trend and momentum continues to be driven by liquidity surge on account of the nearly US$ 5.1 bn FII inflow during the month. Country Index Nikkei RTS Index Taiwan Weighted HangSeng SSE Composite Index Nasdaq Kospi DAX Index S&P Nifty FTSE KLSE Strait Times Dow Jones CAC 40 Index Ibovespa Sao Paulo Index Jakarta Composite Index Swiss Market Index Merval Buenos Aires Index Source: ICRA The performance of sectoral indices reflected the interplay of the specific factors intrinsic and peculiar to each sector; and therefore varied accordingly. The top three sectoral gainers in Feb 2012 month were Realty (14.49%), Capital Goods (11.09%) and Goods (9.86%). On the other hand, FMCG (2.25%), Media (0.94%), and Pharma (-1.61%) remained on the lag end of the sectoral indices performance chart. (Source: NSE & ICRA online). Other Economic News: There has been a noticeable moderation in the Indian gdp growth, with the macro-economic growth rate standing at 6.1% in Q3 FY12 vis-à-vis 8.3% in Q3 FY11. The production of coarse cereals and pulses during the Kharif season of FY12 is estimated to have declined by 4.6 % and 10.3 % respectively, and rice has increased by 11.8 % over the corresponding season in the previous agriculture year. Among the commercial crops, the production of oilseeds is estimated to have declined by 5.1 % during the Kharif season of FY12, while the production of sugarcane and cotton is expected to grow by 1.6% and 3.3 %, respectively during the agriculture year FY12. This is expected to improve supply and alleviate any inflationary pressure on the agri-commodities. Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs. 13,56,576 crore in Q3 of FY12 as against Rs. 11,78,121 crore in Q3 of Items 1.agriculture, forestry & fishing 2.mining & quarrying 3.manufacturing 4.electricity, gas & water supply 5.construction 6.trade, hotels, transport & communication 7.financing, insurance,real estate and business services 8.community, social & personal services 9.GDP at factor cost Source: Central Statistical Office Q3 Fy Country Japan Russia Taiwan Hong Kong China USA S Korea Germany India UK Malaysia Singapore USA France Brazil Indonesia Switzerland Argentina GDP at Factor Cost (in Rs Bn) Q3 Fy Feb Month Performance 10.5% 10.0% 8.0% 6.3% 5.9% 5.4% 3.8% 3.6% 3.6% 3.3% 3.2% 3.0% 2.5% 2.5% 1.9% 1.1% 0.7% -6.7% % Growth in Q3 - Fy12 2.7% -3.1% 0.4% 9.0% 7.2% 9.2% 9.0% 7.9% 6.1% % Growth in Q3 - Fy11 1% 6.10% 7.80% 3.80% 8.70% 9.80% 11.20% -0.80% 8.30% 2 Think s. Think Kotak.

3 In terms of GDP at market prices, the rates of PFCE at current and constant ( ) prices during Q3 of FY12 are estimated at 58.9% and 60.4%, respectively, as against the corresponding rates of 58.4% and 60.4%, respectively in Q3 of Government Final Consumption Expenditure (GFCE) at current prices is estimated at Rs. 2,96,369 crore in Q3 of FY12 as against Rs. 2,61,431 crore in Q3 of In terms of GDP at market prices, the rates of GFCE at current and constant ( ) prices during Q3 of are estimated at 12.9% and 12.2%, respectively, as against the corresponding rates of 13.0% and 12.5%, respectively in Q3 of Gross Fixed Capital Formation (GFCF) at current prices is estimated at Rs. 6,37,212 crore in Q3 of FY12 as against Rs. 5,99,854 crore in Q3 of In terms of GDP at market prices, the rates of GFCF at current and constant ( ) prices during Q3 of FY12 are estimated at 27.6% and 30.0%, respectively, as against the corresponding rates of 29.8% and 32.3%, respectively in Q3 of Market Outlook: The long term outlook continues to remain positive for Indian equities as the economic growth momentum remains healthy with real GDP growth remaining at around 7%. We expect earnings and the earnings growth to support the positive outlook. However, the market may face near term challenges as it gets impacted by events / news-flows that may have a near term negative implications. It is expected that the Chinese GDP projections may outline the thinking of policy makers toward additional liquidity. Another important events from here may be the outcome of state elections (more important is UP) this week and the RBI's monetary policy and Union Budget the following week. The outcomes from these results may provide us some better clarity on political compulsions and policy making going forward. However post the sharp run up, valuations are no longer compelling. Markets may consequently take a breather before the next move. On the other hand, the prices of the select commodities in the energy and related segment continued to show buoyancy. The inflation in Fuel & power segment as of 14th Jan, 2012 stood at 14.45%. During the same period last year, the inflation in this segment was at 10.87%. The manufactured products segment displayed growth in the prices, registering a price growth of 6.49% yoy in January Outlook : The liquidity in the banking system continues to remain in the negative, with the system borrowing around Rs 180,000 cr daily. At that, the steep moderation in the Q3 FY12 gdp also provides a robust rationale for an early revision in the repo rates. A growth orientation is all the more needed, since for the first time the gross fixed capital investments have fallen for 2nd straight quarter in a row in the last 15 years. This provides for a likelihood that RBI may resort to CRR and/or Repo rate cut in its March and April policy meeting. In fact, the 10 year benchmark gilt has already begun to factor-in this possibility; and is expected to trade in the % range in the month ahead. Gold Corner For the February month, the spot gold closed at $ 1788 per ounce, up $ 50 or percent. During the period, the U.S. Trade-Weighted Dollar Index declined by 0.69 percent. During the start of the month, Gold slumped the most in five weeks as the U.S. economy added more jobs in January than forecast. This signaled that economic growth may reduce the need for the Federal Reserve to expand stimulus measures. (Source: usfunds.com, lbma.org.uk.) Later on, during the month, Gold edged further up. This was due to buoyancy in euro and the possibility that Greece may be moving closer to a bailout deal. The surprisingly strong inflation numbers from China also supported the sentiment (Source: Moreover, the Global gold demand too topped the $200-billion mark for the first time ever in 2011; with the demand increasing to 4067 tonnes. (Source: World Gold Council (WGC). Global Gold Demand (in tonnes) and Avg. Gold Price (USD) Source: RBI; Icraonline Inflation Snapshot of Latest Inflation in Percentage Groups WPI (January month) Debt Market View Items 2nd March th Jan 2012 Reverse Repo Repo CRR SLR Mibor Overnight Call(O/N) CBLO 1 yr T Bill 10 G Sec USD/INR 7.5% 8.5% 5.5% 24.0% 9.1% 9.0% 8.3% 8.5% 8.2% PRIMARY Articles (As on 14th Jan 12) Food Articles Non-Food Articles Minerals FY % 8.50% 5.50% 24% 9.15% 9.09% 8.69% 8.50% 8.35% YoY FY Change Nil Nil Nil Nil -06 bps -06 bps -42 bps -1 bps -12 bps Gold in tonnes Global Gold Demand (in tonnes) - LHS CY Average Gold Prices (USD) - RHS Source: lbma.org.uk & WGC Gold continues to attract attention as it closed above the 200 & 50 day moving average on month end. It had previously crossed below the 200-day moving average on December 14 of last year, and only crossed back above on January 10, giving confidence for higher gold prices to come for the year. Also in India current marriage season is being a strong driver for purchases of gold jewelry and almost 70 percent of gold jewelry is sold during the wedding and festival season, with the country being host to approximately 10 million marriages a year. Even with current high prices, people appear to spending as much, if not more, this year Gold USD FUEL & (As on 14th Jan 12) LPG Petrol High Speed Diesel MANUFACTURED PRODUCTS (January month) Source: Ministry of Commerce & Industry The WPI inflation continues to ease as the price growth in the politicallysensitive primary goods segment declines rapidly. The onset of supply from the kharif harvest has helped reduce the price pressure on the agri-commodities, thus alleviating price concerns. Moreover, the sowing in the Rabi season too largely is proceeding in pace with the normal trend. Consequently, it is expected that the present price trend in the agri-commodities segment may continue. Think s. Think Kotak. 3

4 Name KOTAK 50 An Open-Ended Equity EQUITY FUNDS To generate capital appreciation from a portfolio of predominantly equity and equity related securities. The portfolio will generally comprise of equity and equity related instruments of around 50 companies which may go up to 59 companies but will not exceed 59 at any point in time. KOTAK OPPORTUNITIES An Open - Ended Equity Growth To generate capital appreciation from a diversified portfolio of equity and equity related securities. Available Options Dividend Freq. Trustee s Discretion Trustee s Discretion Fund Managers Mr. Pradeep Kumar & Mr. Krishna Sanghvi Mr. Krishna Sanghvi & Mr. Pankaj Tibrewal Inception i) For redemptions / switch outs (including SIP/STP) within 1 year from the date of allotment of units, irrespective of the amount of investment: 1% ii) For redemptions / switch outs (including SIP/STP) after 1 year from the date of allotment of units, irrespective of the amount of investment: NIL Initial : Rs : Rs & in multiples of Re1 Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: 0.79 Sharpe*: 0.84 Alpha*: 1.61 Standard Deviation*: * Source: Value Research. Nifty 500 December 29,1998 September 9, 2004 Kotak 50 - dividend Nifty # (%) BSE Sensex # (Rs) of Rs in the # Kotak 50 NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Initial : Rs : Rs & in multiples of Re.1. Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: 0.95 Sharpe*: 0.86 Alpha*: 2.98 Standard Deviation*: * Source: Value Research. Kotak Opportunities - growth (%) ^ Nifty # of Rs in the #(Rs) # (Rs) Kotak Opportunities NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Issuer/ Instrument % to Net Equity & Equity related (Listed/ Awaiting listing on Stock Exchange) Infosys Ltd. HDFC Bank Ltd. ITC Ltd. Hindustan Unilever Ltd. Reliance Industries Ltd. Bharti Airtel Ltd. Grid Corporation Of India Ltd Mahindra & Mahindra Ltd. Tata Consultancy Services Ltd. Listed/Awaiting Listing on Stock Exchange - Total Telecom - Services Auto Telecom - Services Auto Other than Hedging Positions through Options as on 29th Feb, 2012 Underlying NIFTY Put Option - March 2012 Long/ Long Futures Price When purchased Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Current Price of the Contract Term Deposit as provided above is towards margin for derivatives transactions 8.60% 7.40% 6.19% 4.99% 4.97% 4.60% 4.33% 4.31% 3.81% 3.64% 39.25% 92.09% Margin Maintained in Lakhs 0 Total exposure due to options (Hedging/ Non-Hedging Positions) as a %age of net assets 0.60 /(Liabilities) 6.57% 0.74% For the period ended 29th Feb, 2012 other than hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 2435, Total number of contracts where futures were sold 4935, Gross Notional value of contracts where futures were bought Rs lacs, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs lacs For the period ended 29th Feb, 2012 non-hedging transactions through options which have already been exercised/expired are as follows; Total Number of contracts where options were bought 2000, Total number of contracts where futures were sold 2000, Gross Notional value of contracts where option were bought Rs lacs, Gross Notional value of contracts where options were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs lacs 16.12% 13.79% 12.51% 9% 8.02% 7.86% 6.57% 4.6% 3.81% 2.64% 15.08% Issuer/ Instrument % to Net Equity & Equity related (Listed/ Awaiting listing on Stock Exchange) HDFC Bank Ltd. Infosys Ltd. Reliance Industries Ltd. Tata Consultancy Services Ltd. Bharti Airtel Ltd. IndusInd Bank Ltd. Grasim Industries Ltd. Hindustan Unilever Ltd. Grid Corporation Of India Ltd Listed/Awaiting Listing on Stock Exchange - Total Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Term Deposit as provided above is towards margin for derivatives transactions For the period ended 29th Feb, 2012 hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 67, Gross Notional value of contracts where futures were bought Rs lacs and Net profit/(loss) value on all these contracts combined Rs.(3.90) lacs For the period ended 29th Feb, 2012 other than hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 540, Total number of contracts where futures were sold 1190, Gross Notional value of contracts where futures were bought Rs lacs, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs lacs Oil Auto Telecom - Services Cement Other than Hedging Positions through Futures as on 29th Feb, 2012 Underlying Long/ Futures Price When purchased Larsen And Toubro Ltd. Bharat Heavy Electricals Ltd. Long Total exposure due to futures (Hedging/ Non-Hedging Positions) as a %age of net assets Money Market Instruments Commercial Paper(CP)/Certificate of Deposits(CD) Andhra Bank - Total TERM DEPOSITS Kotak Mahindra Bank Ltd. Term Deposits - Total /(Liabilities) Current Price of the Contract % 5.42% 5.07% 3.68% 3.40% 2.80% 2.43% 2.40% 2.30% 2.19% 57.12% 92.57% Margin Maintained in Lakhs % 0.48% 0.55% 0.55% 5.58% 0.32% 18.38% 11.38% 8.95% 8.94% 6.13% 6.03% 4.11% 4.1% 3.39% 3.2% 25.39% 4 Think s. Think Kotak.

5 Name KOTAK TAX SAVER An Open-Ended Equity Linked Saving EQUITY FUNDS To generate long-term capital appreciation from a diversified portfolio of equity and equity related securities and enable investors to avail the income tax rebate, as permitted from time to time. KOTAK MID-CAP An Open - Ended Equity Growth To generate capital appreciation from a diversified portfolio of equity and equity related securities. Available Options Dividend Freq. Trustee s Discretion Trustee s Discretion Fund Managers Mr. Pankaj Tibrewal & Mr. Krishna Sanghvi Mr. Pankaj Tibrewal & Mr. Emmanuel Elango Inception is not applicable for Kotak Tax Saver. Initial : Rs. 500 : Rs. 500 & in multiples of Rs. 500 Ideal s Horizon - 3 years AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: Sharpe*: 0.80 Alpha*: 1.39 Standard Deviation*: * Source: Value Research. 500 i) For redemptions / switch outs (including SIP/STP) within 1 year from the date of allotment of units, irrespective of the amount of investment: 1% ii) For redemptions / switch outs (including SIP/STP) after 1 year from the date of allotment of units, irrespective of the amount of investment: NIL Initial : Rs : Rs & in multiples of Re.1. Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: 0.98 Sharpe*: 0.97 Alpha*: 7.44 Standard Deviation*: * Source: Value Research. CNX Midcap November 23, 2005 February 24, 2005 Kotak Tax Saver - Growth Nifty # 9.83 (Rs) of Rs in the # Kotak Tax Saver NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Kotak Midcap - Growth CNX Midcap Nifty # (Rs) of Rs in the # Kotak Midcap NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Issuer/ Instrument % to Net Equity & Equity related (Listed/ Awaiting listing on Stock Exchange) Infosys Ltd. Reliance Industries Ltd. ITC Ltd. HDFC Bank Ltd. Bharti Airtel Ltd. Telecom - Services Motherson Sumi Systems Ltd. Auto Ancillaries State Bank Of India Punjab National Bank Tata Consultancy Services Ltd. Listed/Awaiting Listing on Stock Exchange - Total Collateral Borrowing & Lending obligation /(Liabilities) 6.48% 5.85% 4.97% 4.78% 4.18% 3.07% 2.94% 2.72% 2.67% 2.47% 57.64% 97.77% 1.91% 0.32% Issuer/ Instrument % to Net Equity & Equity related (Listed/ Awaiting listing on Stock Exchange) Motherson Sumi Systems Ltd. Auto Ancillaries Solar Industries India Limited Chemicals GlaxoSmithkline Consumer Healthcare Ltd ING Vysya Bank Ltd. Raymond Limited Textile Products Supreme Industries Limited Industrial Products Torrent Ltd. Gillette India Ltd Hawkins Cooker Ltd Household Appliances Indian Bank Listed/Awaiting Listing on Stock Exchange - Total Collateral Borrowing & Lending obligation /(Liabilities) 3.82% 3.20% 2.74% 2.69% 2.67% 2.65% 2.56% 2.52% 2.52% 2.48% 69.93% 97.78% 2% 0.22% Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Media and Entertainment Industrial Capital Goods Telecom - Services 19.92% 11.67% 7.61% 7.29% 6.01% 5.4% 3.61% 3.56% 3.52% 3.07% 28.34% Media and Entertainment Chemicals Industrial Products Auto Ancillaries Industrial Capital Goods Textile Products 16.24% 10.77% 9.58% 8.78% 5.94% 5.52% 4.75% 3.8% 3.77% 3.49% 27.36% Midcap stocks as a % age of Net : % Think s. Think Kotak. 5

6 Name Available Options Dividend Freq. Fund Managers Inception EQUITY FUNDS To achieve growth by investing in equity & equity related instruments, balanced with income generation by investing in debt & money market instruments. Dividend Payout & Dividend Reinvestment Half Yearly (25th of Mar/Sep) KOTAK BALANCE An Open-Ended Balanced Mr. Emmanuel Elango & Mr. Krishna Sanghvi & Mr. Abhishek Bisen i) For redemptions / switch outs (including SIP/STP) within 1 year from the date of allotment of units, irrespective of the amount of investment: 1% ii) For redemptions / switch outs (including SIP/STP) after 1 year from the date of allotment of units, irrespective of the amount of investment: NIL Initial : Rs : Rs & in multiples of Re1 Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: 0.90 Sharpe*: 0.89 Alpha*: 3.33 Standard Deviation*: *Source: Value Research Balanced Fund Index November 25, 1999 Kotak Balance Balanced Fund Index Nifty # (Rs) of Rs in the Kotak Balance NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). # KOTAK CONTRA An Open - Ended Equity Growth To generate capital appreciation from a diversified portfolio of equity and equity related securities. Trustee s Discretion Mr. Emmanuel Elango & Mr. Krishna Sanghvi Initial : Rs : Rs & in multiples of Re1 Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Turnover: %. Beta*: 0.86 Sharpe*: 0.86 Alpha*: 2.65 Standard Deviation*: *Source: Value Research. S & P CNX 500 July 27, 2005 Kotak Contra Fund - Growth Nifty # (Rs) of Rs in the # Kotak Contra NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Issuer/ Instrument % to Net Equity & Equity related (Listed/Awaiting listing on Stock Exchange) Infosys Ltd. ITC Ltd. HDFC Ltd. Tata Consultancy Services Ltd. HDFC Bank Ltd. Hindustan Petroleum Corporation Ltd Reliance Industries Ltd. Amara Raja Batteries Ltd. Jindal Steel & Ltd. Listed/Awaiting Listing on Stock Exchange - Total Options NIFTY Put Option - March 2012 NIFTY Put Option - March 2012 NIFTY Put Option - March 2012 Options - Total Debt Instruments Shriram Transport Co Ltd. TERM DEPOSITS Kotak Mahindra Bank Ltd. Term Deposits - Total /(Liabilities) Derivatives Auto Ancillaries Ferrous Metals Other than Hedging Positions through Futures as on 29th Feb, 2012 Underlying Tata Steel Limited. Hindalco Industries Ltd National Thermal Corporation Limited Sun Industries Ltd. HDFC Bank Ltd. Grid Corporation Of India Ltd Long/ Long Long Long Long Futures Price When purchased FITCH AA(ind) Current Price of the Contract % 3.81% 3.80% 3.36% 3.23% 3.19% 3.11% 3.03% 2.22% 2.16% 27.02% 59.75% Margin Maintained in Lakhs Total exposure due to futures (Hedging/ Non-Hedging Positions) as a %age of net assets % 0.10% 0.03% 0.29% 6.55% 6.55% 13.73% 13.73% 18.09% -1.95% Total NPA s provided for and percentage to NAV: Total value and percentage to Net Asset of Illiquid Equity Shares: Term Deposit as provided above is towards margin for derivatives transactions. For the period ended 29th Feb, 2012 hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 131, Total number of contracts where futures were sold 54, Gross Notional value of contracts where futures were bought Rs lacs, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs.(24.36) lacs. For the period ended 29th Feb, 2012 other than hedging transactions through futures which have been squared off/expired are as follows; Total number of contracts where futures were sold 100, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs lacs. For the period ended 29th Feb, 2012 non-hedging transactions through options which have already been exercised/expired are as follows; Total Number of contracts where options were bought 394, Total number of contracts where futures were sold 314, Gross Notional value of contracts where option were bought Rs lacs, Gross Notional value of contracts where options were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs. (11.84) lacs 31.82% 9.81% 9.31% 6.55% 6.49% 6.14% 3.94% 3.83% 3.83% 3.8% 14.48% Issuer/ Instrument % to Net Equity & Equity related (Listed/ Awaiting listing on Stock Exchange) HDFC Bank Ltd. Infosys Ltd. ITC Ltd. HDFC Ltd. Grid Corporation Of India Ltd Hindustan Petroleum Corporation Ltd Tata Consultancy Services Ltd. National Thermal Corporation Limited Madras Cements Ltd. Cement Listed/Awaiting Listing on Stock Exchange - Total Other than Hedging Positions through Options as on 29th Feb, 2012 Underlying Long/ Futures Price When purchased NIFTY Put Option - March 2012 NIFTY Put Option - March 2012 NIFTY Put Option - March 2012 TERM DEPOSITS Kotak Mahindra Bank Ltd. Term Deposits - Total /(Liabilities) Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Term Deposit as provided above is towards margin for derivatives transactions For the period ended 29th Feb, 2012 hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where options were bought 244, Total number of contracts where futures were sold 32, Gross Notional value of contracts where option were bought Rs lacs, Gross Notional value of contracts where options were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs.(83.79) lacs For the period ended 29th Feb, 2012 other than hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where options were bought 73, Total number of contracts where futures were sold 295, Gross Notional value of contracts where option were bought Rs lacs, Gross Notional value of contracts where options were sold Rs. 85lacs and Net profit/(loss) value on all these contracts combined Rs lacs For the period ended 29th Feb, 2012 non-hedging transactions through options which have already been exercised/expired are as follows; Total Number of contracts where options were bought 640, Total number of contracts where futures were sold 640, Gross Notional value of contracts where option were bought Rs lacs, Gross Notional value of contracts where options were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs.(24.32) lacs Cement Oil Long Long Current Price of the Contract % 6.03% 5.76% 4.38% 4.31% 4.21% 4.19% 3.94% 3.79% 3.18% 37.62% 83.65% Margin Maintained in Lakhs Long Total exposure due to options (Hedging/ Non-Hedging Positions) as a %age of net assets % 3.78% 11.10% 1.03% 15.73% 14.88% 11.75% 10.2% 7.4% 7.12% 6.59% 6.49% 4.38% 3.15% 12.31% 6 Think s. Think Kotak.

7 Name KOTAK SELECT FOCUS FUND An Open - Ended Equity EQUITY FUNDS The investment objective of the scheme is to generate long-term capital appreciation from a portfolio of equity and equity related securities, generally focused on a few selected sectors. KOTAK EQUITY FOF An Open - Ended Equity Fund of Funds The of the is to generate long term capital appreciation from a portfolio created by investing predominantly in open-ended diversified equity schemes of Mutual Funds registered with SEBI. Available Options Dividend Freq. Trustee s Discretion Trustee s Discretion Fund Managers Mr. Krishna Sanghvi, Mr. Pradeep Kumar & Mr. Abhishek Bisen Mr. Deepak Gupta Inception i) For redemptions / switch outs (including SIP/STP) within 1 year from the date of allotment of units, irrespective of the amount of investment: 1% ii) For redemptions / switch outs (including SIP/STP) after 1 year from the date of allotment of units, irrespective of the amount of investment: NIL Initial : Rs and in multiple of Re. 1 for purchase and for Re 0.01 for switches : Rs and in multiple of Re. 1 Ideal s Horizon years AAUM as on December 31, 2011: Crores Turnover: % S & P CNX Nifty Initial : Rs : Rs & in multiples of Re.1. Ideal s Horizon years AAUM as on December 31, 2011: Crores Ratios: Beta*: 0.90 Sharpe*: 0.83 Alpha*: 1.92 Standard Deviation*: *Source: Value Research S & P CNX Nifty September 11, 2009 August 9, 2004 kotak Select Focus Fund Nifty BSE Sensex # (Rs) Kotak Select Focus NAV (as on December 30, 2011, 31st December 2011 being a non working day) : Rs. Kotak Equity FOF NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer 9925 of Rs in the 9575 # 9503 # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Kotak Equity FOF Nifty BSE Sensex # (Rs) of Rs in the # stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Issuer/ Instrument % to Net Equity & Equity related (Listed/Awaiting listing on Stock Exchange) Infosys Ltd. HDFC Bank Ltd. Reliance Industries Ltd. Tata Consultancy Services Ltd. Bharti Airtel Ltd. Telecom - Services Grid Corporation Of India Ltd State Bank Of India ITC Ltd. IndusInd Bank Ltd. Listed/Awaiting Listing on Stock Exchange - Total Other than Hedging Positions through Futures as on 29th Feb, 2012 Underlying Punjab National Bank TERM DEPOSITS Kotak Mahindra Bank Ltd. Term Deposits - Total Collateral Borrowing & Lending obligation /(Liabilities) Long/ Long Futures Price When purchased Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Current Price of the Contract % 6.53% 5.72% 5.60% 3.77% 2.83% 2.62% 2.60% 2.54% 2.25% 50.43% 93.05% Margin Maintained in Lakhs Total exposure due to futures (Hedging/ Non-Hedging Positions) as a %age of net assets 0.46% 0.46% 2.91% 2.58% Issuer/ Instrument % to Net Equity & Equity related (Listed/Awaiting listing on Stock Exchange) Mutual Fund Units Kotak Opportunities Equity s Prudential ICICI Dynamic Plan Equity s IDFC Imperial Equity Fund Equity s HDFC Top 200 Fund Equity s HDFC Core & Satellite Fund Equity s Mutual Fund Units - Total /(Liabilities) 22.25% 19.59% 18.64% 18.57% 18.29% 97.34% 2.66% Term Deposit as provided above is towards margin for derivatives transactions For the period ended 29th Feb, 2012 other than hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 250, Total number of contracts where futures were sold 250, Gross Notional value of contracts where futures were bought Rs lacs, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs.(22.85) lacs Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Auto Non - Ferrous Metals 21.27% 16.34% 10.8% 8.96% 7.95% 5.15% 4.96% 3.62% 3.37% 3.11% 14.47% Equity s 97.34% 2.66% Risk Factor: Investors shall bear the recurring expenses of the scheme, in addition to the expenses of other schemes in which the Fund of Funds makes investments. Think s. Think Kotak. 7

8 Name I) For exit within 1 year from the date of allotment of units: 1%. ii) For exit after 1 year from the date of allotment of units: Nil EQUITY FUNDS KOTAK EMERGING EQUITY An Open-Ended Equity Growth The investment objective of the scheme is to generate long-term capital appreciation by investing The investment objective of the scheme is to generate long-term capital appreciation from a in an overseas mutual fund scheme that invest in a diversified portfolio of securities as prescribed portfolio of equity and equity related securities, by investing predominantly in mid and small cap by SEBI from time to time in global emerging markets. companies. Available Options Dividend Freq. Trustee s Discretion Trustee s Discretion Fund Managers Mr. Deepak Gupta (Dedicated fund manager for overseas investment) & Mr. Abhishek Bisen Mr. Emmanuel Elango & Mr. Pankaj Tibrewal Inception KOTAK GLOBAL EMERGING MARKET FUND An Open-Ended Equity Initial : Rs : Rs. 1000/- & in multiples of Re. 1. Ideal s Horizon: 1-3 years AAUM as on December 31, 2011: Crores Ratios: Beta*: 0.56 Sharpe*: 1.16 Alpha*: Standard Deviation*: *Source: Value Research MSCI Emerging Market Index September 26, 2007 Kotak Global Emerging Equity Market Fund MSCI Emerging Market Index Nifty # (Rs) 9725 of Rs in the 7725 # 9350 Kotak Global Emerging Market Fund NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). i) For exit within 1 year from the date of allotment of units: 1%. ii) For exit after 1 year from the date of allotment of units: Nil Initial : Rs : Rs. 1000/- & in multiples of Re. 1. Ideal s Horizon: 1-3 years AAUM as on December 31, 2011: Crores Ratios: Turnover: %. Beta*: 0.82 Sharpe*: 0.96 Alpha*: 6.43 Standard Deviation*: *Source: Value Research BSE MID CAP March 30, 2007 Kotak Emerging Equity Fund BSE Midcap Nifty # 4.09 (Rs) 9350 of Rs in the 9538 # Kotak Emerging Equity NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Issuer/ Instrument % to Net Equity & Equity related (Listed/Awaiting listing on Stock Exchange) Overseas Mutual Fund Units Listed/Awaiting Listing on Stock Exchange ishares MSCI Emerging Markets ETF Listed/Awaiting Listing on Stock Exchange - Total T Rowe Global Emerging Markets Equity Class A USD Overseas Mutual Fund Units - Total /(Liabilities) Overseas Mutual Fund Overseas Mutual Fund 25.30% 74.38% 99.68% 0.32% Issuer/ Instrument Equity & Equity related (Listed/Awaiting listing on Stock Exchange) Solar Industries India Limited Torrent Ltd. Gillette India Ltd Motherson Sumi Systems Ltd. Hawkins Cooker Ltd Graphite India Ltd. Supreme Industries Limited Clariant Chemicals (India) Limited Federal Bank Ltd. Goodyear India Ltd Listed/Awaiting Listing on Stock Exchange - Total Money Market Instruments Commercial Paper(CP)/Certificate of Deposits(CD) Andhra Bank - Total /(Liabilities) Chemicals Auto Ancillaries Household Appliances Industrial Products Industrial Products Chemicals Auto Ancillaries % to Net 4.38% 4.21% 3.66% 3.36% 2.97% 2.91% 2.90% 2.87% 2.85% 2.71% 59.55% 92.37% 5.24% 5.24% 2.46% -0.07% Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Overseas Mutual Fund 99.68% 0.32% Chemicals Auto Ancillaries Industrial Products Media and Entertainment Commercial Paper (CP)/Certificate of Deposits (CD) Cement Transportation Midcap and Small cap stocks as a % age of Net : 88.99% 14.42% 12.34% 11.39% 8.1% 7.47% 7.07% 6.71% 5.24% 4.84% 3.68% 18.74% 8 Think s. Think Kotak.

9 Name Available Plans/ Options Dividend Freq. Fund Managers Inception An Open - Ended Equity Growth The investment objective of the scheme is to generate capital appreciation and income by predominantly investing in arbitrage opportunities in the cash and derivatives segment of the equity market, and by investing the balance in debt and money market instruments. Monthly (Monday preceding the last Thursday of the month) Mr. Deepak Gupta & Mr. Abhishek Bisen i) For redemptions/switch outs (including SIP/STP) within 90 days from the date of allotment of units, irrespective of the amount of investment: 0.50%; ii) For redemptions/ switch outs (including SIP/STP) after 90days from the date of allotment of units, irrespective of the amount of investment: Nil Liquid Fund Index September 29, 2005 EQUITY FUNDS KOTAK EQUITY ARBITRAGE Initial : Rs : Rs & in multiples of Re1 Ideal s Horizon - Above 3 Months AAUM as on December 31, 2011: Crores Ratios: Turnover: % Beta*: Sharpe*: 1.75 Alpha*: 1.36 Standard Deviation*: 0.75 *Source: Value Research. Kotak Equity Arbitrage Liquid Fund Index Nifty # 9.57 (Rs) of Rs in the Other than Hedging Positions through Futures as on 29th Feb, 2012 Underlying Long/ CORE Education & Technologies Ltd. Reliance Industries Ltd. Welspun Corp Limited Jindal Steel & Ltd. GVK & Infrastructure Ltd. Pantaloon Retail (india) Ltd. IFCI Ltd. Dena Bank JSW ISPAT Steel Ltd Tata Global Beverages Limited Sintex Industries Ltd. Century Textiles & Industries Ltd. NHPC Limited Raymond Limited Apollo Tyres Ltd. UCO Bank Tata Teleservices Ltd ITC Ltd. Development Credit Bank Ltd. Max India Ltd. Cipla Ltd. Tata Motors Ltd - DVR CESC Ltd. Tata Communications Ltd Essar Oil Ltd. Mcleod Russel India Ltd Grasim Industries Ltd. Hindustan Petroleum Corporation Ltd Dhanlaxmi Bank Ltd. Coal India Ltd. Sterlite Technologies Ltd BGR Energy Systems Ltd Hindustan Construction Co.Ltd National Thermal Corporation Limited Futures Price When purchased # Issuer/ Instrument % to Net Equity & Equity related (Listed/Awaiting listing on Stock Exchange) CORE Education & Technologies Ltd. Reliance Industries Ltd. Welspun Corp Limited Jindal Steel & Ltd. Pantaloon Retail (india) Ltd. GVK & Infrastructure Ltd. IFCI Ltd. Dena Bank JSW ISPAT Steel Ltd Tata Global Beverages Limited Listed/Awaiting Listing on Stock Exchange - Total Ferrous Metals Ferrous Metals Retailing Ferrous Metals Current Price of the Contract % 6.80% 5.50% 4.06% 3.59% 3.58% 2.77% 2.67% 2.26% 2.07% 27.94% 68.54% Margin Maint ained in Lakhs Kotak Equity Arbitrage NAV (as on December 30, 2011, 31st December 2011 being a non working day): Rs (Dividend Option), Rs (Growth Option) stands for data not available. Past Performance may or may not be sustained in future. Note: Point to Point (PTP) in INR show the value of Rs. 10,000/- invested at the beginning of a 12 month period as at the end of that period. Source: ICRA MFI Explorer # Name of. ## Name of. ^ Past performance may or may not be sustained in the future. All payouts during the period have been reinvested in the units of the scheme at the then prevailing NAV. <= 1 year: Absolute; > 1 year: CAGR (Compounded Annualised Growth Rate). Underlying Bank Of Baroda Balrampur Chini Mills Ltd Escorts Ltd. Hexaware Technologies Ltd. Bharti Airtel Ltd. PTC India Ltd. Arvind Mills Ltd. NMDC Ltd. Chambal Fertilisers & Chemicals Ltd Patel Engineering Ltd. Gujarat State Petronet Ltd. Alok Industries Ltd. Sterlite Industries (India) Ltd Shriram Transport Co Ltd. Reliance Infrastructure Ltd Long/ Futures Price When purchased Total NPA s provided for and percentage to NAV: Nil Total value and percentage to Net Asset of Illiquid Equity Shares: Nil Term Deposit as provided above is towards margin for derivatives transactions. Current Price of the Contract Margin Maint ained in Lakhs Total exposure due to futures (Hedging/ Non-Hedging Positions) as a %age of net assets (69.39) TERM DEPOSITS Kotak Mahindra Bank Ltd. Term Deposits - Total Collateral Borrowing & Lending obligation /(Liabilities) 26.93% 26.93% 3.05% 1.48% For the period ended 29th Feb, 2012 hedging transactions through futures which have been squared off/expired are as follows; Total Number of contracts where futures were bought 3226, Total number of contracts where futures were sold 92, Gross Notional value of contracts where futures were bought Rs lacs, Gross Notional value of contracts where futures were sold Rs lacs and Net profit/(loss) value on all these contracts combined Rs.( ) lacs. Ferrous Metals Retailing Industrial Products 29.98% 11.82% 8.32% 7.74% 7.5% 6.39% 4.54% 3.59% 2.82% 2.57% 14.73% Think s. Think Kotak. 9