Reliance Diversified Power Sector Fund An Open-ended Power Sector Scheme

Transcription

1 Reliance Capital Asset Limited A Reliance Capital Company 12th floor, One Indiabulls Centre, Tower 1, Jupiter Mills Compound, 841, Senapati Bapat Marg, Elphinstone Road, Mumbai Annual Report An Open-ended Power Sector Scheme Reliance Mutual Fund (A Trust under the Indian Trust Act, 1882) SPONSOR Reliance Capital Limited (Incorporated under the Companies Act, 1956) Regd. Office : H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Koparkhairane, Navi Mumbai Tel.: , Fax: TRUSTEE Reliance Capital Trustee Co. Limited [CIN - U65910MH1995PLC220528] (Incorporated under the Companies Act, 1956) Corporate Office : 12th floor, One Indiabulls Centre, Tower 1, Jupiter Mills Compound, 841, Senapati Bapat Marg, Elphinstone Road, Mumbai Tel.: Fax: Website : Regd. Office : H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Koparkhairane, Navi Mumbai DIRECTORS OF RELIANCE CAPITAL TRUSTEE CO. Mr. A. N. Shanbhag Mr. P. P. Vora Mr. S. Santhanakrishnan CA. Uttam Prakash Agarwal INVESTMENT MANAGER Reliance Capital Asset Limited [CIN - U65910MH1995PLC220793] (Incorporated under the Companies Act, 1956) Corporate Office : 12th floor, One Indiabulls Centre, Tower 1, Jupiter Mills Compound, 841, Senapati Bapat Marg, Elphinstone Road, Mumbai Tel.: Fax: Website : Regd. Office : H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Koparkhairane, Navi Mumbai DIRECTORS OF RELIANCE CAPITAL ASSET MANAGEMANT Mr. Soumen Ghosh Mr. Kanu Doshi Mr. S. C. Tripathi Mr. Shinichi Okamoto AUDITORS Haribhakti & Co. Chartered Accountants 42, Free Press House, Nariman Point, Mumbai CUSTODIAN Deutsche Bank A.G. Kodak House, Ground Floor, 222, D. N. Road, Mumbai REGISTRAR Karvy Computershare Private Limited 46, Avenue 4, Street No 1, Banjara Hills, Hyderabad Ph : Fax : INTERNAL AUDITORS Price Waterhouse 252, Veer Savarkar Marg, Shivaji Park, Dadar, Mumbai Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.

2 Trustee Report 1. Scheme Performance, Future Outlook and Operations of the Scheme Name of the Scheme / Benchmarks of Inception Compounded Annualised Returns (till ) (in %) 1 year 3 years 5 years Since Inception Reliance Diversified 10-May Power Sector Fund - Growth Option India Power Index Reliance Diversified 14-Feb-08 N.A N.A N.A N.A Power Sector Fund - Institutional - Growth Option India Power Index N.A N.A N.A N.A Reliance Diversified 1-Jan-13 N.A N.A N.A Power Sector Fund - Direct - Growth Option India Power Index N.A N.A N.A Name of the Scheme / Benchmarks of Inception Compounded Annualised Returns as on (in %) 1 year 3 years 5 years Since Inception Reliance Diversified 7-Sep-13 N.A N.A N.A Power Sector Fund - Growth Option S&P BSE Power Index N.A N.A N.A Reliance Diversified 7-Sep-13 N.A N.A N.A N.A Power Sector Fund - Institutional - Growth Option S&P BSE Power Index N.A N.A N.A N.A Reliance Diversified 7-Sep-13 N.A N.A N.A Power Sector Fund - Direct - Growth Option S&P BSE Power Index N.A N.A N.A Past performance may or may not be sustained in future. Returns are of Growth Option. Calculation assume that all payouts during the period have been re-invested in the units of the scheme at the then prevailing NAV. Returns less than 1 year are on absolute basis and more than or equal one year is on compounded annualised basis. Reliance Infrastructure Fund merged with Reliance Diversified Power Sector Fund (RDPSF), effective post the closure of business hours on 6th September pursuant to the same fundamental attributes along with Benchmark of RDPSF were changed w.e.f. 7th September focuses on companies engaged in the power sector. The fund maintains a diversified portfolio across the segment with investments in power generation co s, equipment manufacturers, utilities, power finance etc. The fund has outperformed the benchmark since inception. Future Outlook - The Indian Mutual Fund industry is one of the fastest growing industries in the financial services sector with 47 AMCs currently operating in the country. The industry AAUM has changed with an absolute growth rate of 36% over last 2 years with Rs. 9,05,120 crores of average assets as on March 31, Your Company intends to aggressively pursue growth opportunities in the mutual fund industry both domestic and international and therefore be the most preferred investment choice for investors. Your Company expects that an emerging market like India would experience a sustained higher growth rate. Given the country s high household savings rate along with the current low levels of investments by retail investors where only less than 3% of the household savings is channeled into capital markets, your Company believes that the Mutual Fund Industry is still in a nascent stage and has a huge opportunity for growth and expansion. Being one of the large players in the Industry, your Company will continue investing in growing the market size, achieving product innovation, educating the investors, increasing the distribution reach, enhancing customer service infrastructure with aggressive expansion strategies. 2. Brief background of Sponsors, Trust, Trustee Co. and AMC. a. Reliance Capital Limited [Sponsor] Reliance Mutual Fund has been sponsored by Reliance Capital Limited (RCL), which also happens to be the Settler of this Trust i.e. Reliance Mutual Fund. RCL is a RBI registered Non-Banking Finance Company (NBFC) and has its business interests in Asset, Life Insurance, General Insurance, Private Equity, Proprietary Investments, Stock Broking, & other activities in the Financial Services Sector. b. Reliance Mutual Fund [Trust] Reliance Mutual Fund (RMF) has been set up as a Trust in accordance with the provisions of the Indian Trust Act, 1882 by RCL acting as its Settlor / Sponsor. The Trust came into being vide Trust Deed dated April 25, 1995 (the Original Trust Deed ), which was duly registered under the Indian Registration Act, The Original Trust Deed has also been subsequently amended from time to time. In order to consolidate all amendments to the Original Trust Deed, an Amended and Restated Trust Deed was executed on March 15, 2011 (the Amended and Restated Trust Deed ), which was then duly registered under the Indian Registration Act, 1908 and also submitted with the Securities & Exchange Board of India (SEBI). c. Reliance Capital Trustee Co Limited [Trustee] Reliance Capital Trustee Co. Limited (RCTC) is an unlisted Public Limited Company incorporated under the Companies Act, 1956 on March 01, 1995, having its registered office at H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Koparkhairane, Navi Mumbai and its Corporate Office at One Indiabulls Centre Tower One, 12th floor, Jupiter Mills Compound, Elphinstone Road, Mumbai RCTC is a subsidiary of RCL. RCTC has been appointed as the Trustee of RMF vide Trust Deed dated April 25, 1995 and which Trust Deed has been amended from time to time. As Trustee to RMF, RCTC is discharging its duties and carrying out its responsibilities in terms of the applicable SEBI Regulations and as more particularly provided in the Trust Deed. d. Reliance Capital Asset Limited [Asset Manager] Reliance Capital Asset Limited (RCAM) is an unlisted Public Limited Company incorporated under the Companies Act, 1956 on February 24, 1995, having its registered office at H Block, 1st Floor, Dhirubhai Ambani Knowledge City, Koparkhairane, Navi Mumbai and its Corporate Office at One Indiabulls Centre Tower One, 12th floor, Jupiter Mills Compound, Elphinstone Road, Mumbai RCAM is a subsidiary of RCL. RCAM has been appointed as an Asset Manager of Reliance Mutual Fund by the Trustee i.e. RCTC, vide Investment Agreement (IMA) dated May 12, The IMA has been executed between RCTC and RCAM and has since been amended on August 12, 1997, on January 20, 2004 and then on February 17, Investment Objective of the Scheme The primary investment objective of the scheme is to generate long term capital appreciation by investing predominantly in equity and equity related securities of companies in the power sector. 4. Significant Accounting Policies: Accounting policies followed by Reliance Mutual Fund are in accordance with Securities Exchange Board of India (Mutual Funds) Regulations, Unclaimed Dividend & Redemptions: Unclaimed Dividend Unclaimed Redemptions No. of investors Amount (Rs) No. of investors Amount (Rs.) 5,545 12,556, ,214 18,197, Statutory Information: a. The Sponsors are not responsible or liable for any loss resulting from the operation of the Schemes of the Fund beyond their initial contribution (to the extent contributed) of Rs. 1 Lakh for setting up the Fund, and such other accretions / additions to the same. b. The price and redemption value of the units, and income from them, can go up as well as down with fluctuations in the market value of its underlying investments. c. Full Annual Report shall be disclosed on the website ( com) and shall be available for inspection at the Head Office of the mutual fund. Present and prospective unit holder can obtain copy of the trust deed, the full Annual Report of the Fund / AMC at a price. and on behalf of Reliance Capital Trustee Co. Limited Place: Mumbai A.N. Shanbhag P.P. Vora : June 24, 2014 Director Director Sd/- Sd/- Annual Report

3 Annexure to Trustee Report Redressal of Complaints received against Reliance Mutual Fund during F.Y Name of the Mutual Fund : Reliance Mutual Fund Total Number of Folios : (As on 31 st March, 2014) Complaint code Type of complaint# (a) No. of complaints pending at the beginning of the year (b) No of complaints received during the year Within 30 days days Resolved days Beyond 180 days Action on (a) and (b) Non Actionable* 0-3 months 3-6 months Pending 6-9 months I A Non receipt of Dividend on Units I B Interest on delayed payment of Dividend I C Non receipt of Redemption Proceeds I D Interest on delayed payment of Redemption II A Non receipt of Statement of Account/Unit Certificate II B Discrepancy in Statement of Account II C Data corrections in Investor details II D Non receipt of Annual Report/ Abridged Summary III A Wrong switch between Schemes III B Unauthorized switch between Schemes III C Deviation from Scheme attributes III D Wrong or excess charges/load III E Non updation of changes viz address, PAN, bank details, nomination, etc IV Others ** V SIP Related Total Particulars Count Total Complaints Received During Total Number of Folios Percentage Complaints Against Folios 0.06 ** If others include a type of complaint which is more than 10% of overall complaint, provide that reason separately # including against its authorized persons/ distributors/ employees. etc. *Non actionable means the complaint that are incomplete / outside the scope of the mutual fund 9-12 months Classification of complaints Type of Complaint TYPE I Delay/Non-receipt of money TYPE III Service related I A Dividend on Units III A Wrong switch between Schemes I B Interest on delayed payment of Dividend III B Unauthorized switch between Schemes I C Redemption Proceeds III C Deviation from Scheme attributes I D Interest on delayed payment of Redemption III D Wrong or excess charges/load TYPE II Statement of Account/Unit Certificate/Annual Report III E Non updation of changes viz. address, PAN, bank details, nomination, etc II A Non receipt of Statement of Account/Unit Certificate TYPE IV Others II B II C Discrepancy in Statement of Account Non receipt of Annual Report/Abridged Summary Annual Report

4 Annexure to Trustee Report Redressal of Complaints received against Reliance Mutual Fund during F.Y Name of the Mutual Fund : Reliance Mutual Fund Total Number of Folios : (As on 31 st March, 2014) Complaint code Type of complaint# (a) No. of complaints pending at the beginning of the year (b) No of complaints received during the year Within 30 days days Resolved days Beyond 180 days Action on (a) and (b) Non Actionable* 0-3 months 3-6 months Pending 6-9 months I A Non receipt of Dividend on Units I B Interest on delayed payment of Dividend I C Non receipt of Redemption Proceeds I D Interest on delayed payment of Redemption II A Non receipt of Statement of Account/Unit Certificate II B Discrepancy in Statement of Account II C Data corrections in Investor details II D Non receipt of Annual Report/ Abridged Summary III A Wrong switch between Schemes III B Unauthorized switch between Schemes III C Deviation from Scheme attributes III D Wrong or excess charges/load III E Non updation of changes viz address, PAN, bank details, nomination, etc IV Others ** V SIP Related Total Particulars Count Total Complaints Received During Total Number of Folios Percentage Complaints Against Folios 0.06 ** If others include a type of complaint which is more than 10% of overall complaint, provide that reason separately # including against its authorized persons/ distributors/ employees. etc. *Non actionable means the complaint that are incomplete / outside the scope of the mutual fund 9-12 months Classification of complaints Type of Complaint TYPE I Delay/Non-receipt of money TYPE III Service related I A Dividend on Units III A Wrong switch between Schemes I B Interest on delayed payment of Dividend III B Unauthorized switch between Schemes I C Redemption Proceeds III C Deviation from Scheme attributes I D Interest on delayed payment of Redemption III D Wrong or excess charges/load TYPE II Statement of Account/Unit Certificate/Annual Report III E Non updation of changes viz. address, PAN, bank details, nomination, etc II A Non receipt of Statement of Account/Unit Certificate TYPE IV Others II B II C Discrepancy in Statement of Account Non receipt of Annual Report/Abridged Summary Annual Report

5 AUDITORS REPORT To The Board of Directors Reliance Capital Trustee Co. Limited Reliance Mutual Fund Report on the Financial Statements We have audited the accompanying financial statements of the Reliance Diversified Power Sector Fund ( the Scheme ), which comprise the Balance Sheet as at March 31, 2014, and the Revenue Account and Cash Flow Statement of the scheme for the year then ended and a summary of significant accounting policies and other explanatory information. s Responsibility for the Financial Statements Trustees of Reliance Mutual Fund and Reliance Capital Asset Limited are responsible for the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Scheme in accordance with the accounting policies and standards as specified in the Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and amendments thereto ( the Regulations ). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Scheme s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Scheme internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us, the financial statements give the information required by the Regulations as applicable and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) (b) (c) in the case of the Balance Sheet, of the state of affairs of the Scheme as at March 31, 2014; in the case of the Revenue Account, of the surplus for the year ended on that date; and in the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Report on Other Legal and Regulatory Requirements As required under the Regulations, we report that: 1. We have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit; 2. The Balance Sheet, Revenue Account, and Cash Flow Statement dealt with by this Report are in agreement with the books of account of the Scheme; 3. In our opinion, the Balance Sheet, Revenue Account, and Cash Flow Statement dealt with by this report have been prepared in accordance with the accounting policies and standards as specified in Ninth Schedule of the Regulations. 4. The methods used to value non traded securities, as determined by Reliance Capital Asset Limited under procedures approved by the trustees of Reliance Mutual Fund are in good faith and in accordance with the guidelines for valuation of securities for mutual funds as mentioned in the Eighth Schedule of the Regulations issued by the Securities and Exchange Board of India, are fair and reasonable. HARIBHAKTI & CO. Chartered Accountants Firm Membership No W Sd/- CHETAN DESAI (Partner) Membership No Place: Mumbai : 24 th June, 2014 Annual Report

6 Abridged Balance Sheet as at March 31, 2014 Rupees in Lakhs RELIANCE DIVERSIFIED POWER SECTOR FUND As at As at LIABILITIES 1 Unit Capital 42, , Reserves & Surplus 130, , Unit Premium Reserves 32, , Unrealised Appreciation Reserve Other Reserves 97, , Loans & Borrowings - 4 Current Liabilities & Provisions 3, , Provision for doubtful Income/Deposits Other Current Liabilities & Provisions 3, , TOTAL 177, , ASSETS 1 Investments 1.1 Listed Securities: 171, , Equity Shares 171, , Preference Shares Equity Linked Debentures Other Debentures & Bonds Securitised Debt securities Derivatives Others Securities Awaited Listing: Equity Shares Preference Shares Equity Linked Debentures Other Debentures & Bonds Securitised Debt securities Unlisted Securities Equity Shares Preference Shares Equity Linked Debentures Other Debentures & Bonds Securitised Debt securities Government Securities Treasury Bills Commercial Paper Certificate of Deposits 1, Bill Rediscounting Units of Domestic Mutual Fund eign Securities - - Total Investments 173, , Deposits - 1, Other Current Assets 3, , Cash & Bank Balance CBLO/ Reverse Repo Lending , Others 3, , Deferred Revenue Expenditure - - (to the extent not written off) TOTAL 177, , Notes to Accounts - Annexure I Abridged Revenue Account The Year Ended March 31, 2014 Rupees in Lakhs RELIANCE DIVERSIFIED POWER SECTOR FUND Year Ended Year Ended INCOME 1.1 Dividend 2, , Interest Realised Gain / (Loss) on eign - - Exchange Transactions 1.4 Realised Gains / (Losses) on - - Interscheme sale of investments 1.5 Realised Gains / (Losses) on External (17,228.92) 1, sale / redemption of investments 1.6 Realised Gains / (Losses) on Derivative Transactions 1.7 Other Income ( A ) (13,735.69) 5, EXPENSES 2.1 fees 2, , Service tax on fees Transfer agents fees and expenses Custodian fees Trusteeship fees Commission to Agents , Marketing & Distribution expenses Audit fees Investor education expense Other operating expenses Deferred Revenue Expenses written off - - ( B ) 3, , NET REALISED GAINS / (LOSSES) THE (17,337.62) 1, YEAR / PERIOD (A - B = C) 4 Change in Unrealised Depreciation in value of 41, (28,538.32) investments ( D ) 5 NET GAINS / (LOSSES) THE YEAR / 23, (27,458.25) PERIOD (E=(C+D)) 6 Change in unrealised appreciation in the value - (0.40) of investments (F) 7 NET SURPLUS / (DEFICIT) THE YEAR / PERIOD ( E + F = G ) 23, (27,458.65) 7.1 Add: Balance transfer from Unrealised Appreciation Reserve 7.2 Less: Balance transfer to Unrealised - - Appreciation Reserve 7.3 Add / (Less): Equalisation (3,162.22) (30,625.56) 7.4 Net Gain/(Loss) Brought ward From Previous Year 81, , Total 101, , Dividend appropriation 3, , Income Distributed during the year / 3, , period 9.2 Tax on income distributed during the year / period Retained Surplus / (Deficit) carried forward 97, , to Balance sheet Notes to Accounts - Annexure I Annual Report

7 Notes to Accounts - Annexure I to the Abridged Balance Sheet and Revenue Account for the Year Ended March 31, Investments: All the investments are held in the name of the Scheme, (except for Government Securities and Treasury Bills which are held in the name of the fund) as per clause 7 of the Seventh Schedule under Regulation 44(1) of SEBI (Mutual Funds) Regulations, Open Position of derivatives (outstanding market value & % to Net Assets as of the Year end). NIL. details on derivative positions please refer to Annexure III 1.3. Investments in Associates and Group Companies. Scheme Name Issuer Instrument Reliance Diversified Power Sector Fund Amount (Rs. In lakhs) Aggregate Investments by all schemes (Rs. In lakhs) Amount (Rs. In lakhs) Aggregate Investments by all schemes (Rs. In lakhs) Reliance Infrastructure Ltd Equity 6, , , , Reliance Power Limited Equity 6, , , , There are NIL Open position of Securities Borrowed and / or Lent by the scheme There are no NPA s as on March 31, Aggregate Unrealised Gain / Loss as at the end of the Financial Year and percentage to net assets. Scheme Name Aggregate Unrealised Gain / (Loss) (Rs. In lakhs) % of Net Assets Aggregate Unrealised Gain / (Loss) (Rs. In lakhs) % of Net Assets (20,009.42) % (61,242.41) % 1.7. Aggregate Value of Purchase and Sale with Percentage to average assets. Scheme Name Purchases Sales Purchases Sales Amount (Rs. in lakhs) % to average Net Assets Amount (Rs. in lakhs) % to average Net Assets Amount (Rs. in lakhs) % to average Net Assets Amount (Rs. in lakhs) % to average Net Assets Reliance Diversified Power Sector Fund 39, % 68, % 23, % 81, % 1.8. Non-Traded securities in the portfolio. Scheme Name Amount (Rs. In lakhs) % to Net Assets Amount (Rs. In lakhs) % to Net Assets Equity % - - Debt Money Market 1, % Details of Transaction with Associates under regulation 25(8). Brokerage paid to associates/related parties/group companies of Sponsor/AMC Name of associate/related parties/group companies of Sponsor/AMC Nature of Association/ Nature of relation Period covered Value of transaction (in Rs. Cr. & % of total value of transaction of the fund ) Brokerage (Rs Cr & % of total brokerage paid by the fund) Quant Broking Pvt. Ltd. Associate % % % % Reliance Securities Ltd. Associate % % % % Commission Paid to associates/related parties/group companies of Sponsor/AMC Name of associate/related parties/group companies of sponsor/amc Nature of Association/ Nature of relation Period covered Business given (Rs. Cr. & % of total business received by the fund) Commission paid ( Rs Cr& % of total commission paid by the fund) Indusind Bank Ltd. Associate % % % % Reliance Securities Ltd. Associate % % % % 3 Large Holdings in the Scheme (i.e. in excess of 25% of the net assets) as on March 31, 2014 is NIL. 4 Unit Capital movement during the year ended :Refer ANNEXURE II. 5 Prior Year Comparatives: The figures of the previous Year have been regrouped / rearranged, wherever applicable, to conform to current year s presentation. 6 Contingent Liability - NIL. 7 Expenses other than management fee is inclusive of service tax where applicable. Annual Report

8 8 Other Income : Other Income includes exit load income (net of Service Tax) and miscellaneous income (if any). 9 Details of Credit Default Swap as follows 1. No. of transactions during the year - NIL (Previous Year- NIL) 2. Amount of protection bought during the year - NIL (Previous Year- NIL) 3. No. of transactions where credit event payment was received during the year: a. Pertaining to current years transactions. - NIL (Previous Year- NIL) b. Pertaining to previous year (s) transactions- NIL (Previous Year- NIL) 4. Outstanding transactions as on year end: a. No. of transactions - NIL (Previous Year- NIL) b. Amount of protection - NIL (Previous Year- NIL) 5. Net income/ expense in respect of CDS transactions during year-to-date: a. Premium Paid - NIL (Previous Year- NIL) b. Credit event payments received (net of value of derivable obligations)- NIL (Previous Year- NIL) 10 SEBI vide its letter no. OW/17725/2013 dated 19th July 2013 has accorded its no objection for merger of schemes. Accordingly, Reliance Infrastructure Fund (Transferor scheme) merged with ( Transferee scheme), effective post the closure of business hours on 6th September 2013, by virtue of which net assets of Rs Crores was merged with the. Outstanding Units of Reliance Infrastructure fund were exchanged with units of at the Closing NAV of 06th September 2013 as follows. Transferor scheme Transferee scheme Plan NAV Per Unit ( Rs.) Plan NAV Per Unit ( Rs.) Direct Plan-Bonus Plan Direct Plan-Bonus Plan Direct Plan-Dividend Plan Direct Plan-Dividend Plan Direct Plan-Growth Plan Direct Plan-Growth Plan Institutional Growth Plan Growth Plan Bonus Plan Bonus Plan Dividend Plan Dividend Plan Growth Plan Growth Plan Annual Report

9 Key Statistics for the year ended March 31, 2014 RELIANCE DIVERSIFIED POWER SECTOR FUND Year Ended March 31, 2014 Year Ended March 31, NAV per unit (Rs.): Growth Plan Open High Low End Bonus Plan Open High Low End Dividend Plan Open High Low End Direct Plan-Growth Plan Open High Low End Direct Plan-Bonus Plan Open High Low End Direct Plan-Dividend Plan Open High Low End Closing Assets Under (Rs. in Lakhs) End 173, , Average (AAuM) 153, , Gross income as % of AAuM % 2.62% 4. Expense Ratio: a. Total Expense as % of AAuM (plan wise) Other than Direct Plan 2.35% 2.10% Direct Plan 1.72% 1.70% b. Fee as % of AAuM (plan wise) Other than Direct Plan 1.50% 1.28% Direct Plan 1.50% 1.43% RELIANCE DIVERSIFIED POWER SECTOR FUND Year Ended March 31, 2014 Year Ended March 31, Net Income as a percentage of AAuM % 0.52% 6. Portfolio turnover ratio Total Dividend per unit distributed during the year / period (plan wise) Dividend Plan Direct Dividend Plan Returns: a. Last One Year Growth Plan/Option Growth Plan NA % Direct Plan - Growth Plan NA NA Benchmark (India Power Index) NA % b. Since Inception Growth Plan/Option Growth Plan 29.86% 19.35% Direct Plan - Growth Plan 30.30% % Benchmark (India Power Index) Growth Plan 16.50% 6.50% Direct Plan - Growth Plan 16.50% % 1. Gross income = amount against (A) in the Revenue account i.e. Income. 2. Net income = amount against (C) in the Revenue account i.e. NET REALISED GAINS / (LOSSES) THE YEAR / PERIOD 3. Portfolio Turnover = Lower of sales or purchase divided by the Average AuM for the year/period. 4. AAuM=Average daily net assets and on behalf of Reliance Capital Asset Limited Sd/- Soumen Ghosh Director Sd/- Kanu Doshi Director Sd/- Sundeep Sikka CEO Sd/- Sunil Singhania Fund Manager/ Head - Equities Place : Mumbai : June 24, 2014 and on behalf of Reliance Capital Trustee Co. Limited Sd/- A.N. Shanbhag Director Sd/- P.P. Vora Director Annual Report

10 ANNEXURE II Unit Capital movement during the year ended 31st March 2014 RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each GROWTH PLAN Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 219,866,813 2,198,668, ,168,393 2,791,683,932 Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 5,48,20,389 54,82,03, Add : Subscription during the year / period 1,65,04,952 16,50,49,516 2,57,90,017 25,79,00,175 Less : Redemption during the year / period 66,636, ,360,618 85,091, ,915,973 Unit Capital (Closing Balance) 224,556,093 2,245,560, ,866,813 2,198,668,133 RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each Direct Plan-Growth Plan Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 366,735 3,667, Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 10,82,081 1,08,20, Add : Subscription during the year / period 14,66,106 1,46,61,064 3,81,446 38,14,461 Less : Redemption during the year / period 1,242,946 12,429,459 14, ,114 Unit Capital (Closing Balance) 1,671,976 16,719, ,735 3,667,347 RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each DIVIDEND PLAN Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 199,988,888 1,999,888, ,600,131 2,536,001,313 Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 4,53,39,954 45,33,99, Add : Subscription during the year / period 1,19,31,470 11,93,14,696 1,84,15,816 18,41,58,162 Less : Redemption during the year / period 55,861, ,615,580 72,027, ,270,600 Unit Capital (Closing Balance) 201,398,753 2,013,987, ,988,888 1,999,888,875 RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each Direct Plan-Dividend Plan Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 156,425 1,564, Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 1,02,729 10,27, Add : Subscription during the year / period 5,47,355 54,73,547 1,62,431 16,24,312 Less : Redemption during the year / period 175,097 1,750,971 6,006 60,057 Unit Capital (Closing Balance) 631,412 6,314, ,425 1,564,254 RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each BONUS PLAN Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 1,635,045 16,350,451 1,970,214 19,702,143 Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 2,96,353 29,63, Add : Subscription during the year / period 23,030 2,30,298 59,740 5,97,405 Less : Redemption during the year / period 314,898 3,148, ,910 3,949,097 Unit Capital (Closing Balance) 1,639,530 16,395,302 1,635,045 16,350,451 Direct Plan-Bonus Plan RELIANCE DIVERSIFIED POWER SECTOR FUND Face Value of Rs. 10 Each Units Amount in Rs Units Amount in Rs Unit Capital (Opening Balance) 3,632 36, Add : Subscription during Initial Offer period Add: Allotted on Merger during the year 1,493 14,933 Add : Subscription during the year / period 14,599 1,45,992 3,669 36,693 Less : Redemption during the year / period 7,353 73, Unit Capital (Closing Balance) 12, ,720 3,632 36,322 Annual Report

11 Annexure III Derivatives Disclosure A. Hedging Positions through Futures as on March 31, 2014: NIL. Total %age of existing assets hedged through futures: NIL. the Year ended March 31, 2014 following details specified for hedging transactions through futures which have been squared off/expired: Scheme Name Reliance Diversified Power Sector Fund Total Number of contract where future were bought Total Number of contract where future were sold Gross Notional Value of contracts where futures were bought (In Rs.) Gross Notional Value of contracts where futures were sold (In Rs.) Net Profit/Loss value on all contracts combined (In Rs.) ,822,700 37,329,100 1,506,400 B. Other than Hedging Position through Futures as on March 31, 2014: NIL. Total exposure due to futures (non hedging positions) as a %age of net assets : NIL. the Year ended March 31, 2014 following details specified for non-hedging transactions through futures which have been squared off/expired. Scheme Name Total Number of contract where future were bought Total Number of contract where future were sold Gross Notional Value of contracts where futures were bought ( In Rs.) Gross Notional Value of contracts where futures were sold ( In Rs.) Net Profit/Loss value on all contracts combined (In Rs.) RELIANCE DIVERSIFIED POWER SECTOR FUND ,61,17,690 3,55,95,000 (5,22,690) C. Hedging Position through Put Options as on March 31, 2014 : NIL Total % age of existing assets hedged through Put Options : NIL the Year ended March 31, 2014 following details specified for hedging transactions through options which have already been exercised/expired : NIL. D. Other than Hedging Position through Options as on March 31, 2014; NIL. Total Exposure through options as a %age of net assets: NIL. the Year ended March 31, 2014 following details specified with regard to non-hedging transactions through options which have already been exercised/expired: NIL. E. Hedging Positions through swaps as on March 31, 2014 : NIL Note on Derivatives: The disclosure with respect to Investments in derivatives have been made on the basis of SEBI Circular on Abridged Scheme-wise Annual Report mat and periodic disclosures to the unitholders vide reference IMD/CIR No.8/132968/2008 dated July 24, 2008 and Review of norms for investment and disclosure by Mutual Funds in derivatives vide reference Cir/ IMD/ DF/ 11/ 2010 dated August 18, Annual Report

12 RELIANCE CAPITAL ASSET MANAGEMENT PROXY VOTING POLICY November 2013 Proxy Voting Policy and Procedures for Reliance Mutual Fund Background Securities & Exchange Board of India (SEBI), vide circular ref. SEBI/IMD/Cir No. 18/198647/2010 dated March 15, 2010 stipulated that mutual funds should play an active role in ensuring better corporate governance of listed Companies. In this regard, SEBI has mandated that, Asset Companies shall disclose their policy and procedure, for exercising the voting rights in respect of shares held on behalf of the mutual funds on their website as well as in the annual reports of the schemes. Pursuant to the aforesaid SEBI circular, Reliance Capital Asset Limited, (henceforth referred to as RCAM and/or AMC ), the Investment Manager of Reliance Mutual Fund, has formulated the Proxy Voting Policy and Procedure ( the Policy ) for Reliance Mutual Fund Voting Policy Guidelines Reliance Capital Asset Ltd (RCAM) is the Investment Manager to the Reliance Mutual Fund (RMF). Proxy voting is the paramount, fiduciary duty of the AMC on behalf of the unit holders. The AMC recognizes that this duty requires it, to vote on behalf of the unit-holders in a timely manner and make voting decisions in advancing the economic interests of the unit-holders and protecting their rights as beneficial owners of the companies in whose securities the AMC invests through the schemes that it manages. RCAM will generally vote with the issuer company s management on routine matters. With respect to non-routine matters such as proposed anti-takeover provisions or mergers, the financial impact will be analyzed and the proxy will be voted on a case-by-case basis, in the best interest of the unit-holders. While arriving at the decision to vote, views of the Fund Managers, Research Analysts and other executives and sources may be considered. The requirements from SEBI shall be complied with as may be applicable from time to time. A. Corporate Governance matters (including changes in the state of incorporation, merger and other corporate restructuring and anti takeover provisions): Mergers and acquisitions and corporate restructuring proposals will be subject to appropriate review on a case-by-case basis to determine whether they would be beneficial to shareholders interest. B. Changes to capital structure, (including increases or decreases of capital and preferred stock issuances): The proposals for approval to alter the capital structure of the company, such as an increase in authorized capital will generally be supported. However, each proposal shall be evaluated on a case-by-case basis, to determine whether the proposed changes are in the best interest of the shareholders. C. Stock option plans and other management compensation issues: In general, compensation matters are normally determined by the Company s Board of Directors, rather than the shareholders. The AMC would generally support proposals for Employee Stock option plans and other management compensation plans, but would oppose excessive compensation, if it feels that approval of the plan would be against shareholder interest. D. Corporate Social Responsibilities: The AMC would generally support proposals on social issues that have demonstrable economic benefit to the issuer and long term economic value of the securities held in the scheme on case-by-case basis. E. Appointment and Removal of Directors: The foundation of good corporate governance is in the selection of responsible and qualified, Independent Directors who are likely to diligently represent the interest of the shareholders and oversee management of the Company in the manner that will seek to maximize shareholder value over time. Hence, the AMC would generally support the Board s nominees in the election of Directors and generally support proposals that strengthen the independence of Board of Directors. However, each such proposal shall be evaluated on a case-by-case basis. There may be circumstances where the AMC believes it is in the best interests of a Fund to vote differently than the manner contemplated by the Guidelines. The ultimate decision as to the manner in which the AMC s representatives/proxies will vote rests with Proxy Voting Committee Voting Procedures All the decisions regarding Proxy voting as per the principles set out in this policy would be taken by the Proxy Voting Committee. The Proxy Voting committee shall consist of senior members of RCAM s as appointed by the Board. The Proxy Voting Committee would consist of the following members Chief Executive Officer Head Equity Investments Head Compliance, Legal and Secretarial Head- Service Delivery & Operations Excellence Head Risk Quorum Minimum 3 members, out of which one should be from the Risk Team and one should be either of Chief Executive Officer or Head Legal, Secretarial & Compliance and one should be from the Investments Team. the purposes of quorum, the presence may either be in person or via teleconference/ video conference. Members and personnel from various departments may be asked to participate when considered necessary. Chairman of the Annual Report

13 CEO or any other member present Frequency As and when required subject to at least one meeting per quarter. The above committee composition, quorum, and chairpersons would be subject to approval and revision by the board of directors from time to time. The following procedures would generally followed by the Proxy Voting Committee 1) All notices for which a decision needs to be made regarding voting would be sourced from the Custodian or other specialized agencies providing this service. 2) It would be determined whether the holdings are in the actively managed schemes of Reliance Mutual Fund. 3) The Committee would meet as envisaged in this policy and decide whether to vote for / against / abstain on each of the resolutions. 4) The committee may if it considers it necessary take note of the views of any third party or any member of the RMF s Research or Fund teams before taking any decision. 5) The committee will generally Abstain from voting for the following reasons i) The notices were received late from the investee Company or any service provider. ii) The information available in the notices is not sufficient to take any decision to vote for or against a resolution iii) The holding is in Schemes that are exchange traded funds (ETFs) or index funds which are based on various indices or the price of physical gold, and RMF investment in such schemes are based on the index which is being tracked by such schemes. RMF only invests in such securities which are part of the index and rebalances the holding only when there are any changes to the existing weightage in index due to corporate actions, inclusion or exclusion etc. or any other relevant details received from the index providers. As these schemes follow a passive philosophy towards the investments in these schemes and the investments are not made in the stocks based on active research, RMF would abstain from voting on any resolutions in which the holdings are only in such schemes as on the date of the meeting of the Proxy Voting Committee.. iv) The holding is in Group Companies v) Corporate Governance standards, disclosure requirements, and voting mechanisms vary greatly among the markets outside India in which the schemes may invest. RCAM will accordingly cast the vote in a manner believed to be consistent with the policy, while taking into account differing practices by market. In addition there may be instances in which RCAM may refrain from voting if, the cost of voting in foreign markets may be substantially higher. vi) The Schemes of Reliance Mutual Fund held the securities as on record date but these have been sold prior to the date of the meeting of the Proxy Voting committee. vii) It may also refrain from voting on the issues presented in the resolutions which the committee feels are unlikely to have a material impact on shareholder value and its unit-holders. There may be circumstances where the AMC believes it is in the best interests of a Fund to vote differently than the manner contemplated by the Guidelines. The ultimate decision as to the manner in which the AMC s representatives/proxies will vote rests with Proxy Voting Committee. All the decisions would be minuted in the Proxy Voting Committee Minutes. The finalized Minutes of the Committee shall be signed by the chairperson of the relevant committee meeting. The Proxy Committee minutes would be placed at the meetings of the Boards of Reliance Capital Trustee Company and Reliance Capital Asset Company Limited held immediately after the Proxy Committee s. Conflict of Interest RCAM recognizes that there may be a potential conflict of interest when it votes on an entity with which RCAM may have some relationship. However, RCAM will ensure to vote in the interest of the unit holders. Disclosure of Proxy Voting The Proxy Committee minutes would be placed at the meetings of the Boards of Reliance Capital Trustee Company and Reliance Capital Asset Company Limited. In terms of SEBI Circular No. SEBI/IMD/Cir No. 18/198647/2010 dated March 15, 2010 RCAM shall annually disclose in such format as may be prescribed by SEBI from time to time the actual exercise of the votes in the general meetings of the investee company in the following manner a) Consolidated file across all the schemes shall be disclosed annually on the RMF website. b) Record of Voting shall be disclosed in the annual reports of the specific scheme/s also. Annual Report

14 Disclosure of Actual Exercise of Proxy Voting in AGM/EGMs etc of Investee companies by during Financial Year s Name of Company Type of 24-May-13 NTPC LTD CCM To approve the Scheme of Amalgamation of NTPC Hydro Limited (Transferor Company) and NTPC Limited (Transferee Company). 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To consider and adopt the audited Balance Sheet as at March 31st 2013, the Statement of Profit and Loss for the year ended on that date, and the reports of the Board of Directors & Auditors' thereon 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To declare a dividend on equity shares. 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To appoint Shri Mahesh P Modi, Director, retire by rotation & being eligible for Reappointment 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To appoint Dr. Dharam Vir Kapur, Director, retire by rotation & being eligible for Reappointment 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To appoint Dr. Raghunath A Mashelkar, Director, retire by rotation & being eligible for Reappointment 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To appoint Shri Pawan Kumar Kapil, Director, retire by rotation & being eligible for Reappointment 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To Appoint auditors M/s Chaturvedi & Shah, M/s Deloitte Haskins & Sells & M/s Rajendra & Co. & to fix their remuneration 6-Jun-13 RELIANCE INDUSTRIES LTD AGM To approve the payment of Comission to Non Executive Directors of the Company 7-Jun-13 CAIRN INDIA LTD PBL To consider and approve amendments to Cairn India Performance Option Plan 2006 (CIPOP) 17-Jun-13 JINDAL STEEL POWER LTD PBL To create, offer and allot from time to time up to 5,00,000 Equity Shares of face for value of Re. 1/- each fully paid-up to the permanent employees, existing and future, including any Managing Director or Whole-time Director of the Company under EMPLOYEE STOCK PURCHASE SCHEME. 17-Jun-13 JINDAL STEEL POWER LTD PBL To create, offer and allot from time to time up to 5,00,000 Equity Shares of face value of Re. 1/- each fully paid-up to the permanent employees, existing and future, including any Managing Director or Whole-time Director of the existing and future Subsidiary Companies of the Company under the Employee Stock Purchase Scheme 2013 ( JSPL ESPS 2013 / Scheme ). 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun-13 HINDUSTAN CONSTRUCTION CO LTD 21-Jun Jun Jun-13 HINDUSTAN CONSTRUCTION CO LTD HINDUSTAN CONSTRUCTION CO LTD HINDUSTAN CONSTRUCTION CO LTD AGM To receive, consider, approve and adopt the audited Balance Sheet as at 31st March, 2013 and the Profit & Loss Account for the financial year ended on that date and the reports of the Directors and Auditors. AGM To appoint a Director in place of Mr. K.G. Tendulkar, who retires by rotation and AGM To appoint a Director in place of Mr. Anil C. Singhvi, who retires by rotation and AGM The vacancy caused by the retirement by rotation of Mr. Y. H. Malegam, who has not sought re-appointment, be not filled in at this or any adjournment thereof. AGM To reappoint M/s. K. S. Aiyar & Co., Chartered Accountant, as the Auditors of the Company and to fix their remuneration. AGM To re-appoint Mr. Ajit Gulabchand, as the Managing Director designated as Chairman & Managing Director of the Company for a period of 5yrs w.e.f. April 1, AGM To appoint Mr. Rajgopal Nogja as the Whole-time Director of the Company designated as Group Chief Operating Officer (COO) and Whole-time Director of the Company for a period of 5yrs w.e.f. May 3, AGM To create, offer, issue and allot on a preferential basis upto 4,50,00,000 Warrants to the Promoter Company(ies), for a value not exceeding 64,00,00,000, the Warrant, at their sole option, any time after the Entitlement but before the expiry of 18 (eighteen) months from the date of allotment of such Warrants, to apply for the Equity Shares of the Company in the ratio of 1 fully paid up Equity Share of the Company of face value 1/- each against each Warrant, at an issue price as on the Relevant which shall not be less than the higher of the following in accordance with Regulation 76 (1) of Chapter VII of SEBI (ICDR) Regulations AGM To create, issue, offer and allot, Equity Shares and /or other securities convertible into Equity Shares issued /allotted through Qualified Institutions Placement in accordance with the Regulations for Qualified Institutions Placement (QIP) prescribed under Chapter VIII of the SEBI to any eligible Qualified Institutional Buyers (QIB) for an aggregate amount not exceeding ` 1000 crore. 24-Jun-13 ICICI BANK LTD AGM To receive, consider and adopt the financial statements. 24-Jun-13 ICICI BANK LTD AGM To declare a dividend on Preference shares. 24-Jun-13 ICICI BANK LTD AGM To declare a dividend on Equity shares. 24-Jun-13 ICICI BANK LTD AGM To appoint a Director in place of Mr. K. V. Kamath, who retire by rotation and being eligible, offer himself for reappointment. Vote (/ for Against Against Annual Report