COMBINED KEY INFORMATION MEMORANDUM (KIM) FOR ALL OPEN-ENDED DEBT & EQUITY SCHEMES

Transcription

1 COMBINED KEY INFORMATION MEMORANDUM (KIM) FOR ALL OPEN-ENDED DEBT & EQUITY SCHEMES NAME OF SCHEME Indiabulls Liquid Fund (An Openended Liquid ) THIS PRODUCT IS SUITABLE FOR INVESTORS WHO ARE SEEKING* High level of liquidity with commensurate returns over short term. Through investment in money market & debt securities with maturity of upto 91days. Low Risk RISKOMETER Indiabulls Ultra Short Term Fund (An Openended Debt ) Liquidity with commensurate returns over short term. Through investment in money market and debt securities. Moderately Low Risk Indiabulls Gilt Fund (An Openended Gilt ) Indiabulls Income Fund (An Openended Debt ) Indiabulls Short Term Fund (An Openended Debt Income and capital appreciation over medium to long term. Through investment in sovereign securities issued by Central Government (including Treasury Bills) and/ or by State Government, without any restriction on the maturity of the portfolio. Moderate Risk Regular income and/ or capital appreciation over medium to long term. Through investment in fixed income securities. Moderate Risk Stable returns over short term while maintaining liquidity. Through investment in debt and money market instruments. Moderate Risk 1

2 ) Indiabulls Blue Chip Fund (An Openended Equity ) Capital appreciation over longterm A portfolio that is invested predominantly in equity and equity-related securities of bluechip large-cap companies. High Risk Indiabulls Arbitrage Fund To generate reasonable returns over short to medium term. (An Openended Equity ) Investment predominantly in arbitrage opportunities in the cash and derivative segments of the equity markets and the arbitrage opportunities available within the derivative segment and by investing the balance in debt and money market instruments. Moderately Low Risk *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. Name of Mutual Fund Name of Sponsor Name of Asset Management Company Name of Trustee Company Corporate Office Website Indiabulls Mutual Fund Indiabulls Housing Finance Limited CIN: L65922DL2005PLC Registered Office: M - 62 & 63, 1st Floor, Connaught Place, New Delhi Tel: (011) ; Fax: (011) Indiabulls Asset Management Company Limited CIN: U65991DL2008PLC Registered Office: M - 62 & 63, 1st Floor, Connaught Place, New Delhi Tel: (011) ; Fax: (011) Indiabulls Trustee Company Limited CIN: U65991DL2008PLC Registered Office: M - 62 & 63, 1st Floor, Connaught Place, New Delhi Tel: (011) ; Fax: (011) th Floor, Indiabulls Finance Centre Tower-1, Elphinston Mills Compound, Senapati Bapat Marg, Elphinston Road (West), Mumbai Tel: (022) ; Fax: (022)

3 This Key Information Memorandum (KIM) sets forth the information, which a prospective investor ought to know before investing. For further details of the scheme/ Mutual Fund, due diligence certificate by the AMC, Key Personnel, investors rights & services, risk factors, penalties & pending litigations etc. investors should, before investment, refer to the Information Document and Statement of Additional Information available free of cost at any of the Investor Service Centres or distributors or from the website The particulars have been prepared in accordance with Securities and Exchange Board of India (Mutual Funds) Regulations 1996, as amended till date, and filed with Securities and Exchange Board of India (SEBI). The units being offered for public subscription have not been approved or disapproved by SEBI, nor has SEBI certified the accuracy or adequacy of this KIM. This KIM is dated July 30,

4 I] KEY SCHEME FEATURES (FOR OPEN-ENDED DEBT SCHEMES) Name of the Investment Objective Asset Allocation Indiabulls Liquid Fund (An Open-ended Liquid ) To provide a high level of liquidity with returns commensurate with low risk through a portfolio of money market and debt securities with maturity of upto 91days. However, there can be no assurance that the investment objective of the will be achieved. Type of Instrument Normal Allocation (% of Net Assets) Minimum Maximum Risk Profile (Low/Medium/ Money market and debt instruments with maturity up to 91 days (including floating rate debt instruments, securitized debt*) High) Low to Medium *securitized debt cumulative allocation not to exceed 15% of the net assets of the (No investment in foreign securitized debt). The residual maturity of securitized debt shall not exceed 91 days. Investment in Derivatives upto 50% of the net assets of the. Investment in derivatives shall be strictly in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. Plans B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The various options available under the Direct Plan and Regular Plan and the salient features common to both plans are given below. The has the following Options across a common portfolio: Growth Option Dividend Option Options The Dividend Option has the following Facilities: Dividend Reinvestment Facility (available for daily, weekly, fortnightly and monthly frequency) Dividend Pay-out Facility (available for weekly, fortnightly and monthly frequency). Default Option - Growth. If the investor chooses Dividend Option and fails to mention facility/ frequency then the default facility will be Reinvestment and the default frequency will be monthly. 4

5 Absolute Return % Minimum Application Amount/ Number of Units Benchmark Index Name of the Fund Manager If Dividend payable under Dividend Payout option is equal to or less than Rs. 250/- then the Dividend would be compulsorily reinvested in the option of the Purchase (First purchase) Rs. 500 and in multiple of Re. 1 thereafter Rs. 500 and in multiples of Re. 1 thereafter [For Systematic Investment Plan (SIP)] CRISIL Liquid Fund Index Mr. Malay Shah Additional Purchase (Subsequent purchase) Rs. 500 and in multiple of Re. 1 thereafter Redemption 1 unit or Rs. 1,000 and in multiples of Re.1 thereafter. In case of investors/ unitholders having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, AMC reserves the right to redeem the full available balance. Compounded Annualized Returns (as on ) Indiabulls Liquid Fund Growth (Regular Plan)^ Indiabulls Liquid Fund Growth (Direct Plan)^ Crisil Liquid Fund Index (Benchmark) Returns for the last 1 year 8.88% 8.98% 8.77% Returns for the last 3 years 9.09% % Returns since Inception* 9.30% 9.17% 8.87% ^Past performance may or may not be sustained in the future. Above returns are compounded annualized (CAGR). * Inception Date: October 25, *Inception Date for Direct Plan: January 1, Since inception returns are calculated on allotment price. Performance of the Absolute Returns for the Financial Years Indiabulls Liquid Fund Existing Plan Direct Plan Crisil Liquid Fund Index 0.00 FY FY FY FY Financial Years 5

6 Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: Nil Name of the Investment Objective Indiabulls Ultra Short Term Fund (An Open-ended Debt ) To provide liquidity with returns commensurate with low risk through a portfolio of money market and debt securities. However, there can be no assurance that the investment objective of the will be achieved. Normal Allocation Type of Instrument (% of Net Assets) Minimum Maximum Risk Profile (Low/Medium/ Money market and debt instruments with maturity not greater than 1 year (including floating rate debt instruments, securitized debt*) High) Low to Medium Asset Allocation Debt instruments with maturity greater than 1 year (including floating rate debt instruments, securitized debt*) 0 35 Low to Medium *securitized debt cumulative allocation not to exceed 25% of the net assets of the (No investment in foreign securitized debt). Investment in Debt Derivatives up to 50% of the net assets of the. Investment in debt derivatives shall be strictly in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. Plans B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. Options The various options available under the Direct Plan and Regular Plan and the salient features common to both plans are given below. The has the following Options across a common portfolio: Growth Option Dividend Option The Dividend Option has the following Facilities: Dividend Reinvestment Facility (available for daily, weekly, fortnightly and monthly frequency) Dividend Pay-out Facility (available for weekly, fortnightly and monthly frequency). 6

7 Absolute Return % Default Option- Growth. If the investor chooses Dividend Option and fails to mention facility/ frequency then the default facility will be Reinvestment and the default frequency will be monthly. If Dividend payable under Dividend Payout option is equal to or less than Rs. 250/- then the Dividend would be compulsorily reinvested in the option of the. Purchase (First purchase) Additional Purchase (Subsequent purchase) Redemption Minimum Application Amount/ Number of Units Benchmark Index Name of the Fund Managers Rs. 500 and in multiple of Re. 1 thereafter. Rs. 500 and in multiples of Re. 1 thereafter [For Systematic Investment Plan (SIP)] CRISIL Liquid Fund Index Mr. Malay Shah Compounded Annualized Returns (as on ) Rs. 500 and in multiple of Re. 1 thereafter Indiabulls Ultra Short Term Fund Growth (Regular Plan)^ 1 unit or Rs. 1,000 and in multiples of Re.1 thereafter. In case of investors/ unitholders having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, AMC reserves the right to redeem the full available balance. Indiabulls Ultra Short Term Fund Growth (Direct Plan)^ Crisil Liquid Fund Index (Benchmark) Returns for the last 1 year 9.30% 9.77% 8.77% Returns for the last 3 years 9.23% % Returns since Inception* 9.42% 9.59% 8.88% ^Past performance may or may not be sustained in the future. Above returns are compounded annualized (CAGR). * Inception Date: January 6, *Inception Date for Direct Plan: January 1, Since inception returns are calculated on allotment price. Performance of the Absolute Returns for the Financial Years Indiabulls Ultra Short Term Fund Existing Plan 4.00 Direct Plan 2.00 Crisil Liquid Fund Index 0.00 FY FY FY FY Financial Years 7

8 Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: Nil Name of the Investment Objective Indiabulls Gilt Fund (An Open-ended Gilt ) The scheme seeks to generate income and capital appreciation by investing predominantly in sovereign securities issued by Central Government (including Treasury Bills) and/or by State Government, without any restriction on the maturity of the portfolio. However, there is no assurance that the investment objective of the scheme will be realized and the scheme does not assure or guarantee any returns. Type of Instrument Securities created and issued by Central Government and/ or State Governments including T Bills Minimum Normal Allocation (% of Net Assets) Maximum Risk Profile (Low/Medium/High) Moderate Asset Allocation Cash & Cash Equivalent Securities, CBLO, Repos & Reverse Repos in Govt. Securities Low Investment in Debt Derivatives like Interest Rate Swaps, Forward Rate Agreements, Interest Rate Futures up to 50% of the net assets of the. Investment in debt derivatives shall be strictly in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : Plans Options A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The has the following Options across a common portfolio: Growth Option Dividend Option (Dividend Reinvestment Facility available for weekly, fortnightly and monthly frequency; Dividend Pay-out Facility available for weekly, fortnightly and monthly frequency) Bonus Option (With Auto Investment Redemption Facility (AIRF) at 3/5 years; Auto Bonus Units Redemption Facility (ABRF) at 3/5 years; Further Pay-out & Re-investment facilities are available under both AIRF & ABRF) Default Option - Growth. If the investor chooses Dividend Option and fails to mention facility / frequency then the default facility will be Reinvestment and the default frequency will be monthly. If Dividend payable under Dividend Payout option is equal to or less than Rs. 250/- then the Dividend would be compulsorily reinvested in the option of the. If the investor chooses Bonus Option and within that opts for AIRF and/or ABRF facility but fails to 8

9 Absolute Return % mention the periodicity, then the default auto redemption period will be 5 years. Within AIRF & ABRF facilities, if the investor fails to opt between Pay-out and Re- investment Option, the Default Option will be Re-investment Option. Minimum Application Amount/ Number of Units Benchmark Index Name of the Fund Manager Purchase (First purchase during continuous offer) Rs. 500 and in multiple of Re. 1 thereafter Rs. 500 and in multiples of Re. 1 thereafter [For Systematic Investment Plan (SIP)] ISEC Composite Index Mr. Malay Shah Additional Purchase (Subsequent purchase) Rs. 500 and in multiple of Re. 1 thereafter Redemption 1 unit or Rs and in multiple of Re. 1 thereafter In case of investors/ unitholders having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, AMC reserves the right to redeem the full available balance. Compounded Annualized Returns (as on ) Indiabulls Gilt Fund Growth (Regular Plan)^ Indiabulls Gilt Fund Growth (Direct Plan)^ ISEC Composite Index (Benchmark) Returns for the last 1 year 11.03% 11.96% 11.70% Returns for the last 3 years Returns since Inception* 8.18% 9.43% 8.46% ^ Past performance may or may not be sustained in the future. Above returns are compounded annualized (CAGR). * Inception Date: January 10, Since inception returns are calculated on allotment price Performa nce of the Absolute Returns for the Financial Years Indiabulls Gilt Fund Existing Plan Direct Plan I-Sec Composite Gilt Index 0.00 FY FY FY Financial Years Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: 1%, if redeemed/ switched out within 1 year from the date of allotment. Nil, if redeemed/ switched out after 1 year from the date of allotment. 9

10 Name of the Investment Objective Indiabulls Income Fund (An Open-ended Debt ) The primary investment objective of the is to generate a steady stream of income and/or medium to long term capital appreciation/gain through investment in fixed income securities. However, there can be no assurance that the investment objective of the scheme will be achieved. Type of Instrument Normal Allocation (% of Net Assets) Minimum Maximum Risk Profile (Low/Medium/High) Debt instruments and securitized debt* including Repos in Corporate Debt Securities Low to Medium Asset Allocation Plans Options Money Market Instruments 0 35 Low to Medium *securitized debt cumulative allocation not to exceed 50% of the net assets of the (No investment in foreign securitized debt). Investment in Securitized Debt will be only in investment grade papers. Investment in Debt Derivatives up to 50% of the net assets of the. Investment in debt derivatives shall be strictly in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The has the following Options across a common portfolio: Growth Option Dividend Option The Dividend Option has the following Facilities: Dividend Reinvestment Facility (available for monthly, quarterly, half- yearly frequency) Dividend Pay-out Facility (available for monthly, quarterly, half -yearly frequency) Default Option - Growth If the investor chooses Dividend Option and fails to mention facility / frequency then the default facility will be Reinvestment and the default frequency will be monthly. If Dividend payable under Dividend Payout option is equal to or less than Rs. 250/- then the Dividend would be compulsorily reinvested in the option of the. Minimum Application Amount/ Number of Units Purchase (First purchase during continuous offer) Rs. 500 and in multiple of Re. 1 thereafter. Rs. 500 and in multiples of Re. 1 Additional Purchase (Subsequent purchase) Rs. 500 and in multiple of Re. 1 thereafter Redemption 100 units or Rs and in multiple of Re. 1 thereafter In case of investors/ unitholders having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, 10

11 Absolute Return % Benchmark Index Name of the Fund Manager thereafter (For Systematic Investment Plan (SIP)) CRISIL Composite Bond Fund Index Mr. Malay Shah AMC reserves the right to redeem the full available balance. Compounded Annualized Returns (as on ) Indiabulls Income Fund Growth (Regular Plan)^ Indiabulls Income Fund Growth (Direct Plan)^ CRISIL Composite Bond Fund Index (Benchmark) Returns for the last 1 year 10.65% 11.70% 11.10% Returns for the last 3 years Returns since Inception* 6.76% 7.98% 8.54% ^Past performance may or may not be sustained in the future. Above returns are compounded annualized (CAGR). * Inception Date: March 4, Since inception returns are calculated on allotment price. Absolute Returns for the Financial Years Performa nce of the Indiabulls Income Fund FY FY FY Financial Years Existing Plan Direct Plan Crisil Composite Bond Fund Index Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: 1%, if redeemed/ switched out within 1 year from the date of allotment; Nil, if redeemed/ switched out after 1 year from the date of allotment. 11

12 Name of the Investment Objective Asset Allocation Plans Options Minimum Application Amount/ Number of Indiabulls Short Term Fund (An Open-ended Debt ) The will endeavor to generate stable returns over short term with a low risk strategy while maintaining liquidity through a portfolio comprising debt and money market instruments. However, there can be no assurance that the investment objective of the scheme will be achieved. Normal Allocation(% of Net Assets) Type of Instrument Minimum Maximum Risk Profile (Low/Medium/ High) Money market instruments and debt Instruments including government securities, corporate debt, securitized debt*, repos in corporate debt securities Low to Medium and other debt instruments with maturity less than 3 years Debt instruments including government securities, corporate debt, securitized debt* and other debt 0 20 Low to Medium instruments with maturity of 3 years to 5 years The Average Maturity of the scheme would normally range from 1 to 3 years. *securitized debt cumulative allocation not to exceed 50% of the net assets of the (No investment in foreign securitized debt). Investment in debt derivatives shall be strictly in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, The Fund shall not take any leveraged position. The cumulative gross exposure of the scheme through debt instruments and debt derivatives, if any, shall not exceed 100% of the net assets under management in the scheme. The scheme shall not be investing in foreign securities and also the scheme shall not be engaging in any short-selling. Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The has the following Options across a common portfolio: Growth Option Dividend Option The Dividend Option has the following Facilities: Dividend Reinvestment Facility (available for Weekly, Fortnightly & Monthly frequency) Dividend Pay-out Facility (available for Weekly, Fortnightly & Monthly frequency) Default Option - Growth If the investor chooses Dividend Option and fails to mention facility / frequency then the default facility will be Reinvestment and the default frequency will be monthly. If Dividend payable under Dividend Payout option is equal to or less than Rs. 250/- then the Dividend would be compulsorily reinvested in the option of the. Additional Purchase Purchase (First purchase during Redemption (Subsequent continuous offer) purchase) 12

13 Absolute Return % Units Benchmark Index Name of the Fund Manager Rs. 500 and in multiple of Re. 1 thereafter. Rs. 500 and in multiples of Re. 1 thereafter [For Systematic Investment Plan (SIP)] Rs. 500 and in multiple of Re. 1 thereafter CRISIL Short Term Bond Fund Index Mr. Malay Shah 1 unit or Rs and in multiple of Re. 1 thereafter In case of investors/ unitholders having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, AMC reserves the right to redeem the full available balance. Compounded Annualized Returns (as on ) Indiabulls Short Term Fund Growth (Regular Plan)^ Indiabulls Short Term Fund Growth (Direct Plan)^ CRISIL Short Term Bond Fund Index (Benchmark) Returns for the last 1 year 8.88% 10.17% 9.56% Returns for the last 3 years Returns since Inception* 8.99% 10.23% 10.12% ^Past performance may or may not be sustained in the future. The above returns are compounded annualized (CAGR). * Inception Date: September 13, Since inception returns are calculated on allotment price Absolute Returns for the Financial Years Performa nce of the Indiabulls Short Term Fund Existing Plan Direct Plan Crisil Short Term Bond Fund Index 0.00 FY FY Financial Years Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: 1%, if redeemed/ switched out within 1 year from the date of allotment; Nil, if redeemed/ switched out after 1 year from the date of allotment. 13

14 II] KEY SCHEME FEATURES (FOR OPEN-ENDED EQUITY SCHEME) Name of the Investment Objective Asset Allocation Indiabulls Blue Chip Fund (An Open-ended Equity ) The primary investment objective of the is to seek to provide long-term capital appreciation from a portfolio that is invested predominantly in equity and equity-related securities of blue-chip large-cap companies. However, there can be no assurance that the investment objective of the scheme will be achieved. Normal Allocation (% of Net Assets) Type of Instrument Risk Profile (Low/ Medium/ Minimum Maximum High) Equity and equity related securities Blue Chip Large-Cap Companies* High Equity and equity related securities Other Companies 0 35 High Debt & Money market securities/ instruments 0 35 Low to Medium *For the purposes of this scheme Blue Chip Large Cap Company is a Company with a market capitalization higher than the market capitalization of 101 st company in BSE 500 index, arranged in descending order of market cap. Investment in Derivatives up to 100% of the net assets of the. Investment in derivatives shall be in compliance with SEBI Circular No. Cir/IMD/DF/11/2010 dated August 18, The scheme shall not be investing in foreign equity and equity related securities. The scheme shall not be investing in Securitized Debt Instruments. Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Combined Information Document (SID). The offers following two plans for investment into the : Plans Options A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The has the following Options across a common portfolio: Growth Option Dividend Option The Dividend option has the following facilities: i) Dividend Re-investment Facility ii) Dividend Pay-out Facility Default Option - Growth. If the investor chooses Dividend Option and fails to mention facility then the default facility will be Reinvestment. Minimum Application Amount/ Number of Units Purchase (First purchase during continuous offer) Rs. 500 and in multiple of Re. 1 thereafter Rs. 500 and in multiples of Re. Additional Purchase (Subsequent purchase) Rs. 500 and in multiple of Re. 1 thereafter Redemption 100 units or Rs and in multiple of Re. 1 thereafter. In case of investors / unitholders 14

15 Absolute Return % Benchmark Index Name of the Fund Manager 1 thereafter [For Systematic Investment Plan (SIP)] S&P CNX Nifty Index Mr. Sumit Bhatnagar having available balance less than Rs. 5,000 in their respective folio on the day of submission of valid redemption request, the minimum redemption limit would be the available balance. Compounded Annualized Returns (as on ) Indiabulls Blue Chip Fund Growth (Regular Plan)^ Indiabulls Blue Chip Fund Growth (Direct Plan)^ S&P CNX Nifty Index (Benchmark) Returns for the last 1 year 10.91% 12.50% 9.95% Returns for the last 3 years 14.71% % Returns since Inception* 11.21% 13.73% 13.93% ^Past performance may or may not be sustained in the future. The above Returns are compounded annualized (CAGR) * Inception Date: February 10, *Inception Date for Direct Plan: January 1, Since inception returns are calculated on allotment price. Performance of the Absolute Returns for the Financial Years Indiabulls Blue Chip Fund FY FY FY FY Financial Years Existing Plan Direct Plan CNX Nifty Index Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: 1% if redeemed/switched out within first year, Nil - if redeemed/ switched out after one year. 15

16 Name of the Investment Objective Asset Allocation Indiabulls Arbitrage Fund (An Open-ended Equity ) To generate income by predominantly investing in arbitrage opportunities in the cash and derivative segments of the equity markets and the arbitrage opportunities available within the derivative segment and by investing the balance in debt and money market instruments. However, there can be no assurance that the investment objective of the scheme will be achieved. Normal Allocation (% of Net Assets) Type of Instrument Risk Profile (Low/ Medium/ Minimum Maximum High) Equity and equity related securities* Medium to High Equity Derivatives * Medium to High Debt & Money market securities/instruments 0 35 Low * The asset allocation to the extent of 65% to 100% in Equity and Equity Derivatives is on account of arbitrage strategy pursued by the fund from the hedging perspective and not the exposure. In the event of adequate arbitrage opportunities not being available in the equity and derivative markets, then 100% of the portfolio will be invested in short term debt and money market instruments. The rebalancing of the portfolio in accordance with the asset allocation pattern indicated above shall be done within a period of 30 days and will be ensured that the portfolio adheres to the investment objective of scheme. In cases where the rebalancing is not carried out within 30 days, the reasons for not carrying out the rebalancing within the aforesaid period will be placed before the Trustees and Investment Committee for its consideration. Defensive circumstances are when the arbitrage opportunities in the market place are negligible or returns are lower than alternative investment opportunities as per the allocation pattern. Details pertaining to the same are mentioned under the heading HOW WILL THE SCHEME ALLOCATE ITS ASSETS? in the Information Document (SID). The offers following two plans for investment into the : Plans Options Minimum Application A. Direct Plan: This Plan is suitable for investors who wish to invest directly in the scheme without routing their investment through any distributor. The Direct Plan shall have lower expense ratio compared to the Regular Plan and no commission shall be paid out of the Direct Plan. B. Regular Plan: This Plan is suitable for investors who wish to invest in the through any distributor. This Plan shall have higher expense ratio compared to the Direct Plan and distributor commission may be paid out of this Plan. The Direct Plan and Regular Plan shall have separate NAVs. However, there will be a common portfolio for both plans. The has the following Options across a common portfolio: Growth Option Dividend Option The Dividend option has the following facilities: i) Dividend Re-investment Facility ii) Dividend Pay-out Facility Default Option - Growth. If the investor chooses Dividend Option and fails to mention facility then the default facility will be Reinvestment. Purchase (First purchase during continuous offer) Additional Purchase (Subsequent purchase) Redemption 16

17 Amount/ Number of Units Benchmark Index Name of the Fund Manager Rs. 500 and in multiple of Re. 1 thereafter Rs and in multiples of Re. 1 thereafter [For Systematic Investment Plan (SIP)] CRISIL Liquid Fund Index Rs. 500 and in multiple of Re. 1 thereafter Mr. Sumit Bhatnagar (Equity segment) & Mr. Malay Shah (Debt segment) Rs or account balance, whichever is lower and in multiples of Re. 1 thereafter. Period Indiabulls Arbitrage Fund Growth Regular Plan Returns ^ Indiabulls Arbitrage Fund Growth Direct Plan Returns^ Crisil Liquid Fund Index - Benchmark Returns Since inception* 9.37% 9.98% 8.56% ^Past performance may or may not be sustained in the future. The above Returns are compounded annualized (CAGR) *Inception Date: December 1, Since inception returns are calculated on allotment price. Performance of the Absolute Returns for the Financial Year Existing Plan Direct Plan Crisil Liquid Fund Index FY Expenses of the i. Load Structure Entry Load: Not Applicable Exit Load: 0.5% if redeemed/ switched out within three months from the date of allotment, Nil - if redeemed/ switched out after three months from the date of allotment 17

18 RISK FACTORS FOR ALL SCHEMES i. Standard Risk Factors: 1) Investment in Mutual Fund Units involves investment risks such as trading volumes, settlement risk, liquidity risk, default risk including the possible loss of principal. 2) As the price/ value/ interest rate of the securities in which the invests fluctuates, the value of your investment in the may go up or down. 3) Past performance of the Sponsor/ AMC/ Mutual Fund does not guarantee future performance of the. 4) The name of the does not in any manner indicate either the quality of the or its future prospects and returns. 5) The Sponsor is not responsible or liable for any loss resulting from the operation of the beyond the initial contribution of Rs. 50,000 made by it towards setting up the Fund. 6) The present s are not guaranteed or assured return s. ii. Specific Risk Factors (Common for All s) The following are the risks associated with investment in Fixed Income securities: Interest-Rate Risk: Fixed income securities such as government bonds, corporate bonds, Money Market Instruments and Derivatives run price-risk or interest-rate risk. Generally, when interest rates rise, prices of existing fixed income securities fall and when interest rates drop, such prices increase. The extent of fall or rise in the prices depends upon the coupon and maturity of the security. It also depends upon the yield level at which the security is being traded. Re-investment Risk: Investments in fixed income securities carry re-investment risk as interest rates prevailing on the coupon payment or maturity dates may differ from the original coupon of the bond. Basis Risk: The underlying benchmark of a floating rate security or a swap might become less active or may cease to exist and thus may not be able to capture the exact interest rate movements, leading to loss of value of the portfolio. Spread Risk: In a floating rate security the coupon is expressed in terms of a spread or mark up over the benchmark rate. In the life of the security this spread may move adversely leading to loss in value of the portfolio. The yield of the underlying benchmark might not change, but the spread of the security over the underlying benchmark might increase leading to loss in value of the security. Liquidity Risk: The liquidity of a bond may change, depending on market conditions leading to changes in the liquidity premium attached to the price of the bond. At the time of selling the security, the security can become illiquid, leading to loss in value of the portfolio. Credit Risk: This is the risk associated with the issuer of a debenture/bond or a Money Market Instrument defaulting on coupon payments or in paying back the principal amount on maturity. Even when there is no default, the price of a security may change with expected changes in the credit rating of the issuer. It is to be noted here that a Government Security is a sovereign security and is the safest. Corporate bonds carry a higher amount of credit risk than Government Securities. Within corporate bonds also there are different levels of safety and a bond rated higher by a particular rating agency is safer than a bond rated lower by the same rating agency. Liquidity Risk on account of unlisted securities: The liquidity and valuation of the investments due to their holdings of unlisted securities may be affected if they have to be sold prior to their target date of divestment. The unlisted security can go down in value before the divestment date and selling of these securities before the divestment date can lead to losses in the portfolio. Settlement Risk: Fixed income securities run the risk of settlement which can adversely affect the ability of the fund house to swiftly execute trading strategies which can lead to adverse movements in NAV. Risk Associated with Securitized Debt The may invest in domestic securitized debt such as Asset Backed Securities ( ABS ) or Mortgage Backed Securities ( MBS ). ABS are securitized debts where the underlying assets are receivables arising from various loans including automobile loans, personal loans, loans against consumer durables, etc. MBS are securitized debts where the underlying assets are receivables arising from loans backed by mortgage of residential / commercial properties. 18

19 At present in Indian market, following types of loans are securitized: 1. Auto Loans (cars / commercial vehicles /two wheelers) 2. Residential Mortgages or Housing Loans 3. Consumer Durable Loans 4. Personal Loans 5. Corporate Loans In terms of specific risks attached to securitization, each asset class would have different underlying risks. Residential Mortgages generally have lower default rates than other asset classes, but repossession becomes difficult. On the other hand, repossession and subsequent recovery of commercial vehicles and other auto assets is fairly easier and better compared to mortgages. Asset classes like personal loans, credit card receivables are unsecured and in an economic downturn may witness higher default. The rating agency defines margins, over collateralization and guarantees to bring risk in line with similar AAA rated securities. The factors typically analyzed for any pool are as follows: a. Assets securitized and Size of the loan: This indicates the kind of assets financed with the loan and the average ticket size of the loan. A very low ticket size might mean more costs in originating and servicing of the assets. b. Diversification: Diversification across geographical boundaries and ticket sizes might result in lower delinquency. c. Loan to Value Ratio: Indicates how much % value of the asset is financed by borrowers own equity. The lower this value the better it is. This suggests that where the borrowers own contribution of the asset cost is high; the chances of default are lower. d. Average seasoning of the pool: This indicates whether borrowers have already displayed repayment discipline. The higher the number, the more superior it is. The other main risks pertaining to Securitized debt are as follows: Prepayment Risk: This arises when the borrower pays off the loan sooner than expected. When interest rates decline, borrowers tend to pay off high interest loans with money borrowed at a lower interest rate, which shortens the average maturity of ABS. However, there is some prepayment risk even if interest rates rise, such as when an owner pays off a mortgage when the house is sold or an auto loan is paid off when the car is sold. Reinvestment Risk: Since prepayment risk increases when interest rates decline, this also introduces reinvestment risk, which is the risk that the principal can only be reinvested at a lower rate. Risks associated with Derivatives Transactions Credit Risk: The credit risk is the risk that the counter party will default in its obligations and is generally small as in a Derivative transaction there is generally no exchange of the principal amount. Interest rate Risk: Derivatives carry the risk of adverse changes in the price due to change in interest rates. Basis Risk: When a bond is hedged using a Derivative, the change in price of the bond and the change in price of the Derivative may not be fully correlated leading to basis risk in the portfolio. Liquidity Risk: During the life of the Derivative, the benchmark might become illiquid and might not be fully capturing the interest rate changes in the market, or the selling, unwinding prices might not reflect the underlying assets, rates and indices, leading to loss of value of the portfolio. Model Risk: The risk of mis pricing or improper valuation of Derivatives. Trade Execution: Risk where the final execution price is different from the screen price leading to dilution in the spreads and hence impacting the profitability of the reverse arbitrage strategy. Systemic Risk: For Derivatives, especially OTC ones, the failure of one Counter Party can put the whole system at risk and the whole system can come to a halt. Derivative products are leveraged instruments and can provide disproportionate gains as well as disproportionate losses to the investor. Execution of strategies depends upon the ability of the fund manager to identify such opportunities. Identification and execution of the strategies to be pursued by the fund manager involve uncertainty and decision of fund manager may not always be profitable. No assurance can be given that the fund manager will be able to identify or execute such strategies. The risks associated with the use of Derivatives are different from or possibly greater than, the risks associated with investing directly in securities and other traditional investments. 19

20 Risk associated with Securities Lending (Applicable for all s except Indiabulls Gilt Fund) Securities Lending is a lending of securities through an approved intermediary to a borrower under an agreement for a specified period with the condition that the borrower will return equivalent securities of the same type or class at the end of the specified period along with the corporate benefits accruing on the securities borrowed. There are risks inherent in securities lending, including the risk of failure of the other party, in this case the approved intermediary to comply with the terms of the agreement. Such failure can result in a possible loss of rights to the collateral, the inability of the approved intermediary to return the securities deposited by the lender and the possible loss of corporate benefits accruing thereon. Risk associated with repo/ reverse repo in corporate bonds (Applicable only for Indiabulls Income Fund) Settlement Risk: Corporate Bond Repo will be settled between two counterparties in the OTC segment unlike in the case of CBLO transactions where CCIL stands as central counterparty on all transactions (no settlement risk). Settlement risk in reverse repo will be mitigated by requiring the counterparty (entity borrowing funds from the Mutual Fund) to deliver the defined collateral in the account of the MF before the cash is lent to the counterparty. Further, the Mutual Fund will also have a limited universe of counterparties comprising of Scheduled Commercial Banks, Primary Dealers, Mutual Funds and National Financial Institutions. Quality of collateral: The Mutual Fund will be exposed to credit risk on the underlying collateral downward migration of rating. The Mutual Fund will mitigate this risk by a thorough in-house credit research on the quality of collateral with the objective to minimize instance of rating downgrades on collateral. The Mutual Fund will also impose adequate haircut on the collateral to cushion against any diminution in the value of the collateral. Collateral will require to be rated AAA or equivalent. The Mutual Fund will also not accept as collateral, securities issued by the counterparties themselves. Liquidity of collateral: In the event of default by the counterparty, the Mutual Fund would have recourse to recover its investments by selling the collateral in the market. If the underlying collateral is illiquid, then the Mutual Fund may incur an impact cost at the time of sale (lower price realization). The Mutual Fund seeks to mitigate this risk by imposing specific constraints on the collateral issuer (PSUs/ Financial Institutions etc.), tenor of the collateral (shorter maturity papers are more liquid than longer dated papers) on a case to case basis. Specific Risk Factors & Special Considerations (Applicable only for Indiabulls Blue Chip Fund) 1. Indiabulls Blue Chip Fund is an open ended equity fund investing in Blue Chip Large Cap companies by market capitalization and thus will carry less risk as compared to a mid cap / thematic equity fund. The underlying companies will be more liquid and also the access to information for these companies is very high as the Institutional ownership in these companies is generally large. 2. The value of the s investments may be affected generally by factors affecting securities markets, such as price and volume volatility in the capital markets, interest rates, currency exchange rates, changes in policies of the Government, taxation laws or any other appropriate authority policies and other political and economic developments. Consequently, the NAV of the Units of the may fluctuate and can go up or down. 3. Trading volumes, settlement periods and transfer procedures may restrict the liquidity of the investments made by the. Different segments of the Indian financial markets have different settlement periods and such periods may be extended significantly by unforeseen circumstances leading to delays in receipt of proceeds from sale of securities. 4. As the liquidity of the investments made by the could, at times, be restricted by trading volumes and settlement periods, the time taken by the Mutual Fund for the redemption of units may be significant in the event of a high number of redemption requests or a restructuring of the. In view of the above, the Trustees have a right in its sole discretion, to limit redemptions under certain circumstances as described under the section titled Right to Limit Redemptions. 5. Investment decisions made by the AMC may not always be profitable. 6. The tax benefits available under the scheme are as available under the present taxation laws and subject to relevant conditions. The information given is included for general purposes only and is based on advice that the AMC has received regarding the law and the practice that is currently in force in India and the investors and the Unitholders should be aware that the relevant fiscal rules and their interpretation may change. As is the case with any investment, there can be no guarantee that the tax position or the proposed tax position prevailing at the time of investment in the will endure indefinitely. In view of the individual nature of tax consequences, each Investor / Unitholder is advised to consult his/her own professional tax advisor. 20

21 7. In case of investments in derivative instruments like index futures, the risk/ reward would be the same as investments in portfolio of shares representing an index. However, there may be a cost attached to buying an index future. Further, there could be an element of settlement risk, which could be different from the risk in settling physical shares and there is a risk attached to the liquidity and the depth of the index futures market as it is relatively a new market. 8. Indiabulls Blue Chip Fund may generate returns which are not in line with the performance of the S&P CNX Nifty Index and may arise from a variety of factors including but not limited to: The fund will deploy 0-35% of the net assets by investing in securities other than Large Cap companies in percentages as decided by the investment team from time to time. This will result in the performance of the fund being at variance with the S&P CNX Nifty Index. Also these scrips will normally carry higher risk then Large cap companies Transaction and other expenses, such as but not limited to brokerage, custody, trustee and asset management fees. Being an open-ended scheme, the scheme may hold appropriate levels of cash or cash equivalents to meet ongoing redemptions Specific Risk Factors & Special Considerations (Applicable only for Indiabulls Arbitrage Fund) Risk factors associated with scheme s strategy Lack of opportunity to invest in arbitrage portions in the equity market. The risk of mispricing or improper valuation and the inability of derivatives to correlate perfectly with underlying assets, rates and indices. While future market are typically more liquid than underlying cash market, there can be no assurance that ready liquidity would exists at all point in time for scheme to purchase and close out specific future contract. In case of arbitrage, if futures are allowed to expire with corresponding buy/sell in cash market, there is a risk that price at which futures expires, may/may not match with the actual cost at which it is bought/sold in the cash market in last half an hour of the expiry day (Weighted average price for buy or sell). The is also expected to have a high portfolio churn, especially in a volatile market. There is an execution risk while implementing arbitrage strategies across various segments of the market, which may result in missed investment opportunities, or may also result in losses. In case of a large outflow from the, the may need to reverse the spot-futures transaction before the settlement of the futures trade. While reversing the spot-futures transaction on the Futures & Options settlement day on the exchange, there could be a risk of volume-weighted-average-price of the market being different from the price at which the actual reversal is processed resulting in basis risk. Risk factors associated with investment in equity The proposes to invest in equity and equity related securities. Trading volumes, settlement periods and transfer procedures may restrict the liquidity of these investments. Different segments of Indian financial markets have different settlement periods and such periods may be extended significantly by unforeseen circumstances. The inability of the to make intended securities' purchases due to settlement problems could cause the to miss certain investment opportunities. Delays or other problems in settlement of transactions could result in temporary periods when the assets of the are not invested and no return is earned thereon. The inability to sell securities held in the 's portfolio, due to the absence of a liquid secondary market, would result at times, in potential losses to the, should there be a subsequent decline in the value of securities held in the 's portfolio. Risks associated with investments in derivatives The may invest in derivative products in accordance with and to the extent permitted under the Regulations and by RBI. Derivative products are specialized instruments that require investment techniques and risk analysis different from those associated with stocks and bonds. The use of a derivative requires an understanding not only of the underlying instrument but of the derivative itself. Trading in derivatives carries a high degree of risk although they are traded at a relatively small amount of margin which provides the possibility of great profit or loss in comparison with the principal investment amount. Thus, derivatives are highly leveraged instruments. Even a small price movement in the underlying security could have an impact on their value and consequently, on the NAV of the Units of the. 21