COMMON KEY INFORMATION MEMORANDUM AND APPLICATION FORM Invement Manager: Motilal Oswal Asset Management Company Ltd. Motilal Oswal MOSt Focused Multicap 35 Fund (MOSt Focused Multicap 35 ) (An open ended diversified equity scheme) This product is suitable for inveors who are seeking*: 1. Long Term Capital Grow 2. Invement in a maximum of 35 equity and equity related inruments across sectors and market-capitalization levels 3. High Risk (BROWN) Motilal Oswal MOSt Focused Midcap 30 Fund (MOSt Focused Midcap 30 ) (An open ended equity scheme) This product is suitable for inveors who are seeking*: 1. Long Term Capital Grow 2. Invement in Equity and equity related inruments subject to overall limit of 30 companies 3. High Risk (BROWN) Motilal Oswal MOSt Focused 25 Fund (An open ended equity scheme) This product is suitable for inveors who are seeking*: 1. Return by inveing in upto 25 companies wi long term suainable competitive advantage and grow potential 2. Invement in Equity and equity related inruments subject to overall limit of 25 companies 3. High Risk (BROWN) Motilal Oswal MOSt Ultra Short Term Bond Fund (An open ended debt scheme) This product is suitable for inveors who are seeking*: 1. Optimal returns consient wi moderate levels of risk 2. Invement in debt securities and money market securities wi average maturity less an equal to 12 mons 3. Low Risk (BLUE) *Inveors should consult eir financial advisers if in doubt about wheer e product is suitable for em. Note: Risk is represented as: (BLUE) Please underand at e principal will be at low risk (YELLOW) Please underand at e principal will be at medium risk (BROWN) Please underand at e principal will be at high risk Continuous Offer of Units of e scheme at NAV based prices This Key Information Memorandum (KIM) sets for e information, which a prospective inveor ought to know before inveing. For furer details of e scheme/mutual Fund, due diligence certificate by e AMC, Key Personnel, inveors rights & services, risk factors, penalties & pending litigations etc. inveors should, before invement, refer to e Scheme Information Document and Statement of Additional Information available free of co at any of e Inveor Service Centres or diributors or from e website www.motilaloswal.com/assetmanagement and www.moshares.com. The Scheme particulars have been prepared in accordance wi Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, as amended till date, and filed wi 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 e accuracy or adequacy of is KIM. This KIM is dated July 30, 2014.
Invement Objective Motilal Oswal MOSt Focused Multicap 35 Fund: The invement objective of e Scheme is to achieve long term capital appreciation by primarily inveing in a maximum of 35 equity & equity related inruments across sectors and market-capitalization levels. However, ere can be no assurance or guarantee at e invement objective of e Scheme would be achieved. Motilal Oswal MOSt Focused Midcap 30 Fund: The invement objective of e Scheme is to achieve long term capital appreciation by inveing in a maximum of 30 quality mid-cap companies having long-term competitive advantages and potential for grow. However, ere can be no assurance or guarantee at e invement objective of e Scheme would be achieved. Motilal Oswal MOSt Focused 25 Fund: The invement objective of e Scheme is to achieve long term capital appreciation by inveing in upto 25 companies wi long term suainable competitive advantage and grow potential. However, ere can be no assurance or guarantee at e invement objective of e Scheme would be achieved. Motilal Oswal MOSt Ultra Short Term Bond Fund: The invement objective of e Scheme is to generate optimal returns consient wi moderate levels of risk and liquidity by inveing in debt securities and money market securities. However, ere can be no assurance or guarantee at e invement objective of e Scheme would be achieved. Asset Allocation Pattern of e Schemes Motilal Oswal MOSt Focused Multicap 35 Fund: Inruments Indicative Risk Profile allocations (% of total assets) Min. Max. High / Medium / Low Equity & Equity Related 65 100 High Inruments* Debt Inruments, Money Market 0 35 Low Inruments, G-Secs,Cash and Cash at call,etc. *subject to overall limit of 35 Securities Money Market Inruments include CMBs, T-Bills, and Government securities wi an unexpired maturity upto one year, CBLOs & Repo/ Reverse Repo. The Scheme may inve in derivative products from time to time as permitted by SEBI/RBI. The exposure to derivative inruments shall not exceed 50% of e total Net Assets of Scheme. The Scheme shall not write options or purchase inruments wi embedded written options. The Scheme will not participate in securities lending more an 20% of total Net Assets of e Scheme and would limit its exposure wi regard to securities lending for a single intermediary to e extent of 5% of e total net assets at e time of lending. The cumulative gross exposure rough equity, debt and derivative positions should not exceed 100% of e net assets of e scheme. The Scheme will not inve in Securitised debt, corporate debt repo and reverse repo. The Scheme shall not undertake short selling. The Scheme may inve in foreign securities including ADRs/GDRs/Foreign equity and equity related inruments upto 10% of e total net assets of e Scheme. Such invements will be subject to SEBI (Mutual Funds) Regulations, 1996 and in compliance wi SEBI Circular No. SEBI/IMD/ CIR No.7/104753/07 dated September 26, 2007 and such oer regulations from time to time. Motilal Oswal MOSt Focused Midcap 30 Fund: Inruments Indicative Risk Profile allocations (% of total assets) Min. Max. High / Medium / Low Equity and equity related 65 100 High inruments* selected between Top 101 and 200 lied companies by market capitalization Equity and equity related 0 25 High inruments* beyond e Top 200 lied company and wi market capitalization not lower an INR 600 crs. Debt, Money Market 0 10 Low Inruments, G-Sec, Bonds, Cash and cash equivalents, etc *subject to overall limit of 30 companies Money Market Inruments include CMBs, T-Bills, and Government securities wi an unexpired maturity upto one year, CBLOs & Repo/ Reverse Repo. Exposure by e Scheme in derivative inruments shall not exceed 50% of e total Net Assets of Scheme. The Scheme will not participate in securities lending more an 20% of total Net Assets of e Scheme and would limit its exposure wi regard to securities lending for a single intermediary to e extent of 5% of e total net assets at e time of lending. The cumulative gross exposure rough equity, debt and derivative positions should not exceed 100% of e net assets of e scheme. The scheme will not inve in Securitised debt, corporate debt repo and reverse repo and foreign securities. The scheme shall not undertake short selling. The scheme shall inve in equity and equity related inruments as per e invement objective of e scheme. While it is e intention of e Scheme to maintain e maximum exposure guidelines provided in e table above, ere may be inances when ese percentages may be exceeded. Typically, is may occur while e Scheme is new and e corpus is small ereby causing diversification issues. Motilal Oswal MOSt Focused 25 Fund: Inruments Indicative Risk Profile allocations (% of total assets) Min. Max. High / Medium / Low Equity and equity related 65 100 High inruments* selected from Top 100 lied companies by market capitalization Equity and equity related 0 25 High inruments* of e next 50 companies by market capitalization Money Market Inruments, 0 10 Low G-Secs, Bonds, Debentures and cash at call *subject to overall limit of 25 companies Money Market Inruments include CMBs, T-Bills, and Government securities wi an unexpired maturity upto one year, CBLOs & Repo/ Reverse Repo. The scheme shall inve in equity and equity related inruments as per e invement objective of e scheme. While it is e intention of e Scheme to maintain e maximum exposure guidelines provided in e table above, ere may be inances 2
when ese percentages may be exceeded. Typically, is may occur while e Scheme is new and e corpus is small ereby causing diversification issues. Exposure by e Scheme in derivative inruments shall not exceed 50% of e total Net Assets of Scheme. The Scheme will not participate in ock lending more an 20% of total Net Assets of e Scheme and would limit its exposure wi regard to ock lending for a single intermediary to e extent of 5% of e total net assets at e time of lending. The scheme will not inve in Securitised debt and foreign securities. The cumulative gross exposure rough equity, debt and derivative positions should not exceed 100% of e net assets of e scheme. Motilal Oswal MOSt Ultra Short Term Bond Fund: Inruments Indicative Risk Profile allocations (% of total assets) Min. Max. High / Medium / Low Debt Inruments including 0 100 Low Government Securities, Corporate Debt, Oer debt inruments, Term Deposits and Money Market Inruments wi average maturity less an equal to 12 mons *Money Market Inruments include CMBs, T-Bills, and Government securities wi an unexpired maturity upto one year, CBLOs & Repo/ Reverse Repo.While it is e intention of e Scheme to maintain e maximum exposure guidelines provided in e table above, ere may be inances when ese percentages may be exceeded. Typically, is may occur while e Scheme is new and e corpus is small ereby causing diversification issues. The scheme will not inve in Securitised debt, foreign securities and derivatives. Invement Strategy Motilal Oswal MOSt Focused Multicap 35 Fund: The Scheme will inve in attractive securities across asset classes (debt and equity) and across sectors and capitalization levels. Emphasis will be placed on identifying high quality/high & suainable grow companies for invement. The fund shall follow an active invement yle using bottom-up ock picking. The fund managers shall identify and inve in shares of high quality businesses having suainable and scalable business models us using QGL (Quality, Grow & Longevity) as e key evaluation parameters.. The businesses should have rong earnings grow prospects and be available at reasonable valuations. The fund shall be benchmark agnoic wi a portfolio of high conviction ock ideas from across market-capitalization levels/ sectors. The portfolio ocks could be potentially concentrated in a few market capitalization levels/ sectors which have very low downside risk. The fund can inve in compelling opportunities in foreign lied securities (including ETFs and oer overseas funds) The fund may also selectively inve in rong business franchises in e unlied space, wi a scalable business model and available at attractive valuations. While making invement decisions, besides oer factors, e impact of e prevailing economic environment over e medium to long term prospects of e companies will also be taken into consideration. The AMC will endeavour to meet e invement objective of e Scheme while maintaining a balance between safety, liquidity and return on invements. Motilal Oswal MOSt Focused Midcap 30 Fund: The primary invement objective of e Scheme is to generate returns by inveing in a portfolio of midcap equity and equity related inruments, money market inruments, cash and cash equivalents. The Fund may also enter into securities lending or such oer transactions, in accordance wi e Regulations, as may be allowed to Mutual Funds from time to time. The portfolio will essentially follow MOAMC s QGL philosophy i.e. inve in Quality businesses wi reasonable Grow potential and wi sufficient Longevity of at grow potential. The scheme shall follow an active invement yle and will seek to inve in midcap companies wi a rong competitive position or economic moat, good business prospects, run by a competent management at will help em achieve good grow over e medium to long term and available at reasonable valuations. The fund shall practice a focused, high-conviction portfolio rategy wi a low-churn, buy and hold approach to inveing. It will typically select companies from beyond e Top 100 lied entities on e Indian ock exchanges and companies wi market capitalizations not lower an INR 600crs. The long-term India grow ory provides an excellent platform for small and mid-size businesses to unleash eir grow potential and to emerge as large cap companies of e future. India has a pleora of mid-size lied companies and eir number has only risen in recent years. We believe e midcap universe in India even today presents similar such invement opportunities from a medium to long term perspective. Besides, midcaps are typically found to be under-owned and under-researched and hence provide a large universe of exciting invement prospects. While making invement decisions, besides oer factors, e impact of e prevailing economic environment over e medium to long term prospects of e companies will also be taken into consideration. The AMC will endeavour to meet e invement objective of e Scheme while maintaining a balance between safety, liquidity and return on invements. Motilal Oswal MOSt Focused 25 Fund: The primary invement objective of e Scheme is to generate returns by inveing in a portfolio of primarily in equity and equity related inruments, money market inruments, cash and cash equivalents. The Fund may also enter into Stock Lending or such oer transactions, in accordance wi e Regulations, as may be allowed to Mutual Funds from time to time. The scheme shall follow an active invement yle and it will seek to inve in companies wi rong competitive position, good indury prospects, good business prospects along wi quality management at may help em to achieve good grow over medium to long term. While making invement decisions, besides oer factors, e impact of e prevailing economic environment over e medium to long term prospects of e companies will also be taken into consideration. The AMC will endeavour to meet e invement objective of e Scheme while maintaining a balance between safety, liquidity and return on invements. Motilal Oswal MOSt Ultra Short Term Bond Fund: The fund management team will endeavor to maintain a consient performance in e scheme by maintaining a balance between safety, liquidity and profitability aspects of various invements. The fund manager will try to achieve an optimal risk return balance for management of e fixed income portfolios. The invements in debt inruments carry various risks like intere rate risk, liquidity risk, default risk, purchasing power risk etc. While ey cannot be done away wi, ey can be minimized by diversification and effective use of hedging techniques. The fund management team will take an active view of e intere rate movement by keeping a close watch on various parameters of e Indian economy, as well as developments in global markets. Invement in debt inruments carry various risks like Intere Rate Risk, Liquidity Risk, Credit Risk, etc. While ey cannot be eliminated, ey can be reduced by diversification and effective use of hedging techniques. Invement views/decisions will be taken on e basis of following parameters: 1. Liquidity of e security. 2. Maturity profile of e inruments. 3. Quality of e Security/inrument (including e financial heal of e issuer). 4. Returns offered relative to alternative invement opportunities. 5. Prevailing intere rate scenario. 6. Any oer factors considered relevant in e opinion of e AMC. Risk Profile of e Schemes Mutual Fund units involve risks including e possible loss of principal. Please read 3
Scheme Information Document (SID) carefully for details on risk factors before invement. Scheme Specific Risk factors are summarized below: Risk factors for Motilal Oswal MOSt Focused Multicap 35 Fund, Motilal Oswal MOSt Focused Midcap 30 Fund and Motilal Oswal MOSt Focused 25 Fund : Risks associated wi inveing in Equities Equity and Equity related inruments on account of its volatile nature are subject to price fluctuations on daily basis. The volatility in e value of e equity and equity related inruments is due to various micro and macro economic factors affecting e securities markets. This may have adverse impact on individual securities/sector and consequently on e NAV of Scheme. The inability of e Scheme to make intended securities purchases due to settlement problems could cause e Scheme to miss certain invement opportunities as in certain cases, settlement periods may be extended significantly by unforeseen circumances. Similarly, e inability to sell securities held in e Scheme portfolio may result, at times, in potential losses to e Scheme, should ere be a subsequently decline in e value of e securities held in e Schemes portfolio. The Scheme may find itself inveed in unlied securities eier by choice or due to external events or corporate actions. This may increase e risk of e portfolio as ese unlied securities are inherently illiquid in nature and carry larger liquidity risk as compared to e lied securities or ose at offer oer exit options to e inveors. Market Risk The Scheme s NAV will react to ock market movements. The value of invements in e scheme may go down over a short or long period due to fluctuations in Scheme s NAV in response to factors such as performance of companies whose ock comprises e underlying portfolio, economic and political developments, changes in intere rates, inflation and oer monetary factors causing movement in prices of underlining invements. Asset Class Risk The returns from e types of securities in which e Scheme inves may under perform from e various general securities markets or different asset classes. Different types of securities tend to go rough cycles of out-performance and underperformance in comparison wi e general securities markets. Intere Rate Risk Changes in intere rates will affect e Scheme s Net Asset Value. The prices of securities usually increase as intere rates decline and usually decrease as intere rates rise. The extent of fall or rise in e prices is guided by duration, which is a function of e exiing coupon, days to maturity and increase or decrease in e level of intere rate. The new level of intere rate is determined by e rate at which e government raises new money and/or e price levels at which e market is already dealing in exiing securities. Prices of long-term securities generally fluctuate more in response to intere rate changes an short-term securities. The price risk is low in e case of e floating rate or inflation-linked bonds. The price risk does not exi if e invement is made under a repo agreement. Debt markets, especially in developing markets like India, can be volatile leading to e possibility of price movements up or down in fixed income securities and ereby to possible movements in e NAV. Credit Risk Credit Risk means at e issuer of a security may default on intere payments or even paying back e principal amount on maturity. (i.e. e issuer may be unable to make timely principal and intere payments on e security). Even where no default occurs, e prices of security may go down because e credit rating of an issuer goes down. It mu be, however, noted at where e Scheme has inveed in Government securities, ere is no risk to at extent. Liquidity or Marketability Risk This refers to e ease at which a security can be sold at or near its true value. The primary measure of liquidity risk is e spread between e bid price and e offer price quoted by a dealer. Liquidity risk is characteriic of e Indian fixed income market. Trading Volumes, settlement periods and transfer procedures may rerict e liquidity of e invements made by e Scheme. Different segments of e Indian financial markets have different settlement periods and such period may be extended significantly by unforeseen circumances leading to delays in receipt of proceeds from sale of securities. As liquidity of e invements made by e Scheme could, at times, be rericted by trading volumes and settlement periods, e time taken by e Fund for redemption of units may be significant in e event of an inordinately large number of redemption reques or reructuring of e Scheme. Right to Limit Redemptions The Truee, in e general intere of e unit holders of e Scheme offered under is SID and keeping in view of unforeseen circumances/unusual market conditions, may limit e total number of Units which can be redeemed on any Business Day. This could also happen in e event of receipt of inordinately large number of redemption reques or a reructuring of a Scheme portfolio Risks associated wi Inveing in Derivatives Derivative products are leveraged inruments and can provide disproportionate gains as well as disproportionate losses to e inveor. Execution of such rategies depends upon e ability of e fund manager to identify such opportunities. Identification and execution of e rategies to be pursued by e fund manager involve uncertainty and decision of e fund manager may not always be profitable. No assurance can be given at e fund manager will be able to identify or execute such rategies. Derivative products are specialized inruments at require invement techniques and risk analysis different from ose associated wi ocks. The use of a derivative requires an underanding not only of e underlying inrument but of e derivative itself. Derivatives require e maintenance of adequate controls to monitor e transactions entered into, e ability to assess e risk at a derivative adds to e portfolio and e ability to foreca price or intere rate movements correctly. There is a possibility at a loss may be suained by e portfolio as a result of e failure of anoer party (usually referred to as e counterparty ) to comply wi e terms of e derivatives contract. Oer risks in using derivatives include e risk of mis-pricing or improper valuation of derivatives and e inability of derivatives to correlate perfectly wi underlying assets, rates and indices, illiquidity risk whereby e Scheme may not be able to sell or purchase derivative quickly enough at a fair price. The risks associated wi e use of derivatives are different from or possibly greater an, e risks associated wi inveing directly in securities and oer traditional invements. Risk associated wi securities lending Securities Lending is a lending of securities rough an approved intermediary to a borrower under an agreement for a specified period wi e condition at e borrower will return equivalent securities of e same type or class at e end of e specified period along wi e corporate benefits accruing on e securities borrowed. In case e Scheme undertakes securities lending as prescribed in e Regulations, it may, at times be exposed to counter party risk and oer risks associated wi e securities lending. Uniolders of e Scheme should note at ere are risks inherent to securities lending, including e risk of failure of e oer party, in is case e approved intermediary, to comply wi e terms of e agreement entered into between e lender of securities i.e. e Scheme and e approved intermediary. Such failure can result in e possible loss of rights to e collateral put up by e borrower of e securities, e inability of e approved intermediary to return e securities deposited by e lender and e possible loss of any corporate benefits accruing to e lender from e securities deposited wi e approved intermediary. The Fund may not be able to sell such lent securities and is can lead to temporary illiquidity. Risk associated wi Invement in foreign securities/overseas invements (Applicable to e Scheme, Motilal Oswal MOSt Focused Multicap 35 Fund) The Scheme may inve in foreign securities. Such overseas invements will be made subject to necessary approvals, conditions ereof as may be ipulated from time to time. The invement in foreign securities carries an exchange rate risks related to depreciation of foreign currency and country risks. The country risks would include events such as change in regulations or political circumances like introduction of extraordinary exchange rate controls, rerictions on repatriation of capital due to exchange rate controls, bilateral political tensions leading to immobilisation of overseas financial assets and e prevalent tax laws of e respective jurisdiction for e execution of trades or oerwise. As e Scheme shall inve in securities lied on e overseas ock exchange, all e risk factors pertaining to overseas ock exchange like market trading risk, liquidity risk and volatility risk, as mentioned earlier, are also applicable to e Scheme. The Scheme will also be exposed to settlement risk, as different countries have different settlement periods. 4
Risk Control: Invement by e Scheme would be made as per e invement objective of e Scheme and in accordance wi SEBI Regulations. AMC has adequate safeguards to manage risk in e portfolio conruction process. Risk control would involve managing risk in order to keep in line wi e invement objective of e Scheme. The risk control process would include identifying e risk and taking proper measures for e same. The syem has incorporated all e invement rerictions as per e SEBI guidelines and enables identifying and measuring e risk rough various risk management tools like various portfolio analytics, risk ratios, average duration and analyses e same and acts in a preventive manner. Risk factors for Motilal Oswal MOSt Ultra Short Term Bond Fund Market Risk The Scheme s NAV will react to e intere rate movements. The Inveor may lose money over short or long period due to fluctuation in Scheme s NAV in response to factors such as economic and political developments, changes in intere rates, inflation and oer monetary factors and also movement in prices of underlining invements. Regulatory Risk Any changes in trading regulations by NSE or SEBI may affect e ability of market maker to arbitrage resulting into wider premium/discount to NAV. Right to Limit Redemptions The Truee, in e general intere of e unit holders of e Scheme offered under is SID and keeping in view of e unforeseen circumances/unusual market conditions, may limit e total number of Units which can be redeemed on any Business Day. Asset Class Risk The returns from e types of securities in which e Scheme inves may under perform from e various general securities markets or different asset classes. Different types of securities tend to go rough cycles of out-performance and underperformance in comparison wi e general securities markets. Intere Rate Risk Changes in intere rates will affect e Scheme s Net Asset Value. The prices of securities usually increase as intere rates decline and usually decrease as intere rates rise. The extent of fall or rise in e prices is guided by modified duration, which is a function of e exiing coupon, days to maturity and increase or decrease in e level of intere rate. The new level of intere rate is determined by e rate at which e government raises new money and/or e price levels at which e market is already dealing in exiing securities. Prices of long-term securities generally fluctuate more in response to intere rate changes an short-term securities. The price risk is low in e case of e floating rate or inflation-linked bonds. The price risk does not exi if e invement is made under a repo agreement. Debt markets, especially in developing markets like India, can be volatile leading to e possibility of price movements up or down in fixed income securities and ereby to possible movements in e NAV. Modified Duration is a measure of price sensitivity, e change in e value of invement to a 1% change in e yield of e invement. Credit Risk Credit Risk means at e issuer of a security may default on intere payments or even paying back e principal amount on maturity. (i.e. e issuer may be unable to make timely principal and intere payments on e security). Even where no default occurs, e prices of security may go down because e credit rating of an issuer goes down. It mu be, however, noted at where e Scheme has inveed in Government securities, ere is no risk to at extent. Liquidity or Marketability Risk This refers to e ease at which a security can be sold at or near its true value. The primary measure of liquidity risk is e spread between e bid price and e offer price quoted by a dealer. Liquidity risk is characteriic of e Indian fixed income market. Trading Volumes, settlement periods and transfer procedures may rerict e liquidity of e invements made by e Scheme. Different segments of e Indian financial markets have different settlement periods and such period may be extended significantly by unforeseen circumances leading to delays in receipt of proceeds from sale of securities. As liquidity of e invements made by e Scheme could, at times, be rericted by trading volumes and settlement periods, e time taken by e Fund for redemption of units may be significant in e event of an inordinately large number of redemption reques or reructuring of e Scheme. Risks associated wi short selling Scheme may enter into short selling transactions, subject to SEBI and RBI regulations in e matter. This will be done if e fund management team is of e view at ere exis an opportunity to make trading gains. Calls for short selling will be taken after considering e liquidity, price movement & volatility of e security by e fund management team. There can be a loss in such a transaction if e price of e security goes up inead of falling down. Each Scheme has two Plans: (i) Regular Plan and (ii) Direct Plan Plans and Options Regular Plan is for Inveors who purchase/subscribe units in a Scheme rough any Diributor (AMFI Regiered Diributor/ARN Holder). Direct Plan is for inveors who purchase /subscribe units in a Scheme directly wi e Fund and is not routed rough a Diributor (AMFI Regiered Diributor/ARN Holder). Each Plan offers e following Options: (a) Grow Option (b) Dividend Option (wi Payout and Re-invement facility) Under Dividend Option, e Fund will endeavor to declare dividends from time to time depending on e availability of diributable surplus. Note: If dividend payable under e dividend payout option is equal to or less an Rs. 500/-, en it would be compulsorily re-inveed in e option of e Scheme. The AMC reserves e right to introduce furer Plans / Options as and when deemed fit. Default Plan/Option Inveors subscribing Units under Direct Plan of a Scheme should indicate Direct Plan again e Scheme name in e application form. Inveors should also mention Direct in e ARN column of e application form. However, in case Diributor code is mentioned in e application form but Direct Plan is mentioned again e Scheme name, en e Diributor code will be ignored and e application will be processed under Direct Plan. Furer, where application is received wiout mentioning Diributor code nor Direct is mentioned in e ARN Column, en e application will be processed under Direct Plan. If e inveor does not clearly specify e choice of option at e time of inveing, it will be deemed at e inveor has opted for Grow option and in case he does not specify payout/re-invement under Dividend option, it will be deemed to be dividend re-invement. Motilal Oswal MOSt Ultra Short Term Bond Fund: Sub-Options (Under each Dividend Plan) Plan Options Facility Frequency Record date Sub- Options/ Regular Dividend Dividend Re- Daily Every business and invement day Direct Dividend Dividend Re- Weekly Every Friday* invement Dividend Dividend Re- Fortnightly Every 2nd & 4 invement Friday* of e Mon Dividend Dividend Re- Monly Every la Friday* of invement / e mon Payout Dividend Dividend Re- Quarterly Every la Friday* of invement / e quarter Payout 5
* If Friday is a holiday, en e record date shall be e previous Business day. Applicable NAV Cut off timing for subscriptions / purchases / switch- ins for an amount less an Rs. 2,00,000 (Rs. Two lakh only) For Purchases including switch-ins: i. In respect of valid applications received by 3.00 p.m. by e Fund along wi a local cheque or a demand draft payable at par at e Official Point(s) of Acceptance where e application is received, e closing NAV of e day on which application is received shall be applicable. ii. In respect of valid applications received after 3.00 p.m. by e Fund along wi a local cheque or a demand draft payable at par at e Official Point(s) of Acceptance where e application is received, e closing NAV of e following Business Day shall be applicable. iii. In respect of valid applications wi an outation cheques or demand drafts not payable at par at e Official Points of Acceptance where e application is received, e closing NAV of day on which e cheque or demand draft is credited shall be applicable. Cut off timing for subscriptions / purchases / switch- ins amount equal to or greater an Rs. 2,00,000 (Rs. Two lakh only) i. In respect of valid applications received for an amount equal to or more an Rs. 2 lakh upto 3.00 p.m. at e Official Point(s) of Acceptance and where e funds for e entire amount of subscription / purchase/switch-ins as per e application are credited to e bank account of e Scheme before e cut-off time i.e. available for utilization before e cut-off time- e closing NAV of e day shall be applicable. ii. In respect of valid applications received for an amount equal to or more an Rs. 2 lakh after 3.00 p.m. at e Official Point(s) of Acceptance and where e funds for e entire amount of subscription / purchase as per e application are credited to e bank account of e Scheme before e cut-off time of e next Business Day i.e. available for utilization before e cut-off time of e next Business Day - e closing NAV of e next Business Day shall be applicable. iii. Irrespective of e time of receipt of applications for an amount equal to or more an Rs. 2 lakh at e Official Point(s) of Acceptance, where e funds for e entire amount of subscription/purchase/ switch-ins as per e application are credited to e bank account of e Scheme before e cut-off time on any subsequent Business Day i.e. available for utilization before e cut-off time on any subsequent Business Day - e closing NAV of such subsequent Business Day shall be applicable. It is clarified at all multiple applications for invement at e Unit holders PAN and holding pattern level in a Scheme (irrespective of amount or e plan/option/suboption) received on e same Business Day, will be aggregated to ascertain wheer e total amount equals to Rs. 2 lakh or more and to determine e applicable Net Asset Value. Transactions in e name of minor received rough guardian will not be aggregated wi e transaction in e name of same guardian. The criteria for aggregation of multiple transactions shall be as decided by e AMC at its sole discretion from time to time. For invements of an amount equal to or more an Rs. 2 lakh rough syematic invement routes such as Syematic Invement Plan (SIP), Syematic Transfer Plan (STP) e units will be allotted as per e closing NAVof e day on which e funds are available for utilization by e target scheme. For Redemption/ Repurchases/Switch out I. In respect of valid application accepted at an Official Points of Acceptance as lied in e SAI up to 3 p.m. on a Business Day by e Fund, e closing NAV of at day will be applicable. ii. In respect of valid application accepted at an Official Point of Acceptance after 3 p.m. on a Business Day by e Fund, e closing NAV of e next Business Day will be applicable. Minimum Application and Redemption Amount Minimum Application Amount: Rs. 5,000/- and in multiples of re. 1/- ereafter. Minimum Additional Amount: Rs. 1,000/- and in multiples of re. 1/- ereafter. Minimum Redemption Amount: Minimum of Rs. 1,000/- and in multiples of Re. 1/- ereafter or total invement amount whichever is lower. Despatch of Repurchase (Redemption) Reque Wiing 10 working days of e receipt of e redemption reque at e auorised centre of e Motilal Oswal Mutual Fund. Benchmark Index Motilal Oswal MOSt Focused Multicap 35 Fund: CNX 500 Index Motilal Oswal MOSt Focused Midcap 30 Fund: CNX Midcap Index Motilal Oswal MOSt Focused 25 Fund: CNX Nifty Index Motilal Oswal MOSt Ultra Short Term Bond Fund: CRISIL Short Term Bond Fund Index Dividend Policy The Truees may declare dividend subject to e availability of diributable surplus calculated in accordance wi SEBI (Mutual Funds) Regulations, 1996. The actual declaration of dividend and e frequency of diribution will be entirely at e discretion of e Truees. There is no assurance or guarantee to Unit holders as to e rate of dividend diribution nor at e dividends will be declared regularly, ough it is e intention of e Mutual Fund to make regular dividend diribution under e Dividend Plan. The dividend would be paid to e Uniolders whose names appear in e Regier of Uniolders as on e record date. Name of e Fund Manager Motilal Oswal MOSt Focused Multicap 35 Fund: For Equity Component: Mr. Gautam Sinha Roy For Debt Component: Mr. Abhiroop Mukherjee For Foreign Securities: Mr. Anubhav Srivaava Motilal Oswal MOSt Focused Midcap 30 Fund: For Equity Component: Mr. Taher Badshsah For Debt Component: Mr. Abhiroop Mukherjee Motilal Oswal MOSt Focused 25 Fund: For Equity Component: Mr. Taher Badshah For Debt Component: Mr. Abhiroop Mukherjee Motilal Oswal MOSt Ultra Short Term Bond Fund: Mr. Abhiroop Mukherjee Motilal Oswal Truee Company Ltd. Name of Truee Company Performance of e Scheme Motilal Oswal MOSt Focused Multicap 35 Fund: The Scheme is a new Scheme and has not completed 1 year. Motilal Oswal MOSt Focused Midcap 30 Fund (As on March 31, 2014): Particulars Scheme Returns % Benchmark Returns % MOSt Focused Midcap 30 CNX Midcap Index Returns since inception* 7.33% 11.98% 6
Absolute Returns for e la Financial Year 14.00% 12.00% 10.00% 8.00% 6.00% 4.00% 2.00% 0.00% Note: Pa Performance may or may not be suained in future. *Returns are absolute and inception date is deemed to be Date of Allotment Date of Allotment: February 24, 2014 Motilal Oswal MOSt Focused 25 Fund (As on March 31, 2014): Particulars Scheme Returns % Benchmark Returns % 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% Motilal Oswal MOSt Focused 25 Fund FY 2013-2014 (Sep 6,2013 to Mar 31, 2014) CNX Nifty Index Returns since inception* 10.58% 12.10% Absolute Returns for e la Financial Year 12.50% 12.00% 11.50% 11.00% 10.50% 10.00% 9.50% FY 2013-2014 (Feb 24, 2014 - Mar 31, 2014) MOSt Focused Midcap 30 FY2013-2014 (May 13,2013 - Mar 31, 2014) MOSt Focused 25 Note: Pa Performance may or may not be suained in future. *Returns are absolute and inception date is deemed to be Date of Allotment Date of Allotment: May 13, 2013 Motilal Oswal MOSt Ultra Short Term Bond Fund (As on March 31, 2014): Particulars Scheme Returns % Benchmark Returns % MOSt Ultra Short Term Bold Fund CRISIL Short Term Bond Fund Index Returns since inception* 4.63% 6.17% Absolute Returns for e la Financial Year CNX Midcap Index CNX Nifty Index Expenses of e Scheme Motilal Oswal MOSt Focused Multicap 35 Fund: I) Load Structure Type of Load Entry Exit ii) Recurring expenses Load chargeable (as %age of NAV) NIL NIL These are e fees and expenses for operating e Scheme. These expenses include but are not limited to Invement Management and Advisory Fee charged by e AMC, Regirar and Transfer agents fees & expenses, marketing and selling cos etc. The AMC has eimated at e following expenses will be charged to e Scheme, as permitted under Regulation 52 of SEBI (MF) Regulations. For e actual current expenses being charged, e inveor should refer to e website of e Fund. Particulars Invement Management and Advisory Fees Truee fee Audit fees % p.a. of daily Net Assets Cuodian fees Upto 2.50% Regirar & Transfer Agent Fees Marketing & Selling expense including agents' commission Co related to inveor communications Co of fund transfer from location to location Co of providing account atements and dividend/ redemption cheques and warrants Cos of atutory Advertisements Co towards inveor education & awareness (at lea 2 bps) Brokerage & transaction co over and above 12 bps and 5 bps for cash and derivative market trades respectively Service tax on expenses oer an invement management and advisory fees Service tax on brokerage and transaction co Oer Expenses Maximum total expense ratio (TER) permissible Upto 2.50% under Regulation 52 (6) Additional expenses under regulation 52 (6A) (C) Upto 0.20% Additional expenses for gross new inflows from Upto 0.30% specified cities under Regulation 52 (6A)(b) The purpose of e above table is to assi e inveor in underanding e various cos & expenses at e inveor in e Scheme will bear directly or indirectly. These eimates have been made in good fai as per e information available to e AMC and e above expenses (including invement management and advisory fees) are subject to inter-se change and may increase/decrease as per actual and/or any change in e Regulations, as amended from time to time. The TER of e Direct Plan will be lower to e extent of e diribution expenses/commission which is charged in e Regular Plan. The recurring expenses of e Scheme (excluding additional expenses under MOSt Ultra Short Term Bond Fund CRISIL Short Term Bond Fund Index Note: Pa Performance may or may not be suained in future. *Returns are absolute and inception date is deemed to be Date of Allotment Date of Allotment : September 6, 2013 7
regulation 52(6A) (C) and additional diribution expenses for gross inflows from specified cities), as per SEBI Regulations are as follows: (I) On e fir Rs. 100 crores of e daily net assets - 2.50% (ii) On e next Rs. 300 crores of e daily net assets - 2.25% (iii) On e next Rs. 300 crores of e daily net assets - 2.00% (iv) On e balance of e assets - 1.75% In accordance wi Regulation 52(6A), e following expenses can be charged in addition to e exiing total recurring expenses charged under Regulation 52(6): a. brokerage and transaction cos which are incurred for e purpose of execution of trade and is included in e co of invement, not exceeding 0.12 % in case of cash market transactions and 0.05 % in case of derivatives transactions; Any payment towards brokerage and transaction cos, over and above e said 12 bps and 5 bps for cash market and derivatives transactions respectively, shall be charged to e Scheme wiin e total recurring expenses limit specified under Regulation 52 of SEBI Regulations. Any expenditure in excess of e said limit will be borne by e AMC/Truees/Sponsors. b. additional expenses upto 30 basis points on daily net assets of e scheme, if e new inflows from such cities as specified by SEBI from time to time are at lea: (a) 30% of gross new inflows in e scheme or (b) 15% of e average assets under management (year to date) of e scheme, whichever is higher. In case, e inflows from such cities is less an e higher of (a) or (b) above, such additional expenses on daily net assets of e scheme will be charged on a proportionate basis. The expenses charged under is clause shall be utilised for diribution expenses incurred for bringing inflows from such cities The amount incurred as expenses on account of inflows from such cities so charged shall be credited back to e Scheme in case, e said inflows are redeemed wiin a period of 1 year from e date of invement. Currently, SEBI has specified at e above additional expenses may be charged for inflows from beyond 'Top 15 cities.' The top 15 cities shall mean top 15 cities based on Association of Mutual Funds in India (AMFI) data on 'AUM by Geography Consolidated Data for Mutual Fund Indury' as at e end of e previous financial year. c. additional expenses not exceeding 0.20% of daily net assets of e scheme, towards invement & advisory fees and/or towards recurring expenses as specified under 52(2) and 52(4) of e Regulations. In addition to expenses under Regulation 52(6) and (6A), AMC may charge service tax on invement and advisory fees, expenses oer an invement and advisory fees and brokerage and transaction co as below: 1. Service tax on invement and advisory fees charged to e scheme will be in addition to e maximum limit of TER as prescribed in regulation 52 (6) of e SEBI Regulations. 2. Service tax on oer an invement and advisory fees, if any, shall be borne by e scheme wiin e maximum limit of TER as per regulation 52 of e SEBI Regulations. 3. Service tax on exit load, if any, will be paid out of e exit load proceeds and exit load net of service tax, if any, shall be credited to e scheme. 4. Service tax on brokerage and transaction co paid for execution of trade, if any, shall be wiin e limit prescribed under regulation 52 of e SEBI Regulations. The Direct Plan shall have a lower expense ratio to e extent of diribution expenses, commission, etc and no commission for diribution of Units will be paid / charged under e Direct Plan. The AMC shall charge e invement management and advisory fees and e total recurring expenses of e Scheme in accordance wi e limits prescribed from time to time under e SEBI Regulations. Expenses over and above e prescribed ceiling will be borne by e AMC / Truee / Sponsor. The current expense ratios will be updated on e Fund's website, www.motilaloswal.com/asset-management wiin two working days mentioning e effective date of e change. Actual expenses for e previous financial year 2013-14 (Unaudited): Regular Plan 2.5% Direct Plan 1.50% Motilal Oswal MOSt Focused Midcap 30 Fund I) Load Structure Type of Load Entry Exit Load chargeable (as %age of NAV) NIL NIL The entire exit load (Net of service tax) charged, is any, shall be credited to e scheme II) Recurring Expenses: These are e fees and expenses for operating e Scheme. These expenses include but are not limited to Invement Management and Advisory Fee charged by e AMC, Regirar and Transfer agents fees & expenses, marketing and selling cos etc. The AMC has eimated at e following expenses will be charged to e Scheme, as permitted under Regulation 52 of SEBI (MF) Regulations. For e actual current expenses being charged, e inveor should refer to e website of e Fund. Expense Head Invement Management and Advisory Fees Truee fee Audit fees Cuodian fees Regirar & Transfer Agent Fees %of daily Net Asses Marketing & Selling expense including agents commission Upto 2.50% Co related to inveor communications Co of fund transfer from location to location Co of providing account atements and dividend/ redemption cheques and warrants Cos of atutory Advertisements Co towards inveor education & awareness (at lea 2 bps) and 5 bps for cash and derivative market trades respectively Service tax on expenses oer an invement management and advisory fees Service tax on brokerage and transaction co Oer Expenses Maximum total expense ratio (TER) permissible under Upto 2.50% Regulation 52 (6) Additional expenses under regulation 52 (6A) (C) Upto 0.20% Additional expenses for gross new inflows from specified Upto 0.30% cities under Regulation 52 (6A)(b) The purpose of e above table is to assi e inveor in underanding e various cos & expenses at e inveor in e Scheme will bear directly or indirectly. These eimates have been made in good fai as per e information available to e AMC and e above expenses (including invement management and advisory fees) are subject to inter-se change and may increase/decrease as per actual and/or any change in e Regulations, as amended from time to time. At lea 40% of e TER is charged towards diribution expenses/ commission in e Regular Plan. The TER of e Direct Plan will be lower to e extent of e abovementioned diribution expenses/ commission (at lea 40%) which is charged in e Regular Plan. The total expenses of e Scheme (excluding additional expenses under regulation 52(6A) (C) and additional diribution expenses for gross inflows from specified cities), as per SEBI Regulations are as follows: Fir ` 100 crores of e daily net assets - 2.50% 8
Next ` 300 crores - 2.25% Next ` 300 crores - 2.00% Over ` 700 crore - 1.75% In accordance wi Regulation 52(6A), e following expenses can be charged in addition to e exiing total recurring expenses charged under Regulation 52(6): a. Brokerage and transaction cos which are incurred for e purpose of execution of trade and is included in e co of invement, not exceeding 0.12 % in case of cash market transactions and 0.05 % in case of derivatives transactions; Any payment towards brokerage and transaction cos, over and above e said 12 bps and 5 bps for cash market and derivatives transactions respectively, shall be charged to e Scheme wiin e total recurring expenses limit specified under Regulation 52 of SEBI Regulations. Any expenditure in excess of e said limit will be borne by e AMC/Truees/Sponsors. b. additional expenses upto 30 basis points on daily net assets of e scheme, if e new inflows from such cities as specified by SEBI from time to time are at lea: (a) 30% of gross new inflows in e scheme or (b) 15% of e average assets under management (year to date) of e scheme, whichever is higher. In case, e inflows from such cities is less an e higher of (a) or (b) above, such additional expenses on daily net assets of e scheme will be charged on a proportionate basis. The expenses charged under is clause shall be utilised for diribution expenses incurred for bringing inflows from such cities The amount incurred as expenses on account of inflows from such cities so charged shall be credited back to e Scheme in case, e said inflows are redeemed wiin a period of 1 year from e date of invement. Currently, SEBI has specified at e above additional expenses may be charged for inflows from beyond 'Top 15 cities.' The top 15 cities shall mean top 15 cities based on Association of Mutual Funds in India (AMFI) data on 'AUM by Geography Consolidated Data for Mutual Fund Indury' as at e end of e previous financial year. c. additional expenses not exceeding 0.20% of daily net assets of e scheme, towards invement & advisory fees and/or towards recurring expenses as specified under 52(2) and 52(4) of e Regulations. In addition to expenses under Regulation 52(6) and (6A), AMC may charge service tax on invement and advisory fees, expenses oer an invement and advisory fees and brokerage and transaction co as below: 1. Service tax on invement and advisory fees charged to e scheme will be in addition to e maximum limit of TER as prescribed in regulation 52 (6) of e SEBI Regulations. 2. Service tax on oer an invement and advisory fees, if any, shall be borne by e scheme wiin e maximum limit of TER as per regulation 52 of e SEBI Regulations. 3. Service tax on exit load, if any, will be paid out of e exit load proceeds and exit load net of service tax, if any, shall be credited to e scheme. 4. Service tax on brokerage and transaction co paid for execution of trade, if any, shall be wiin e limit prescribed under regulation 52 of e SEBI Regulations. The Direct Plan shall have a lower expense ratio to e extent of diribution expenses, commission, etc and no commission for diribution of Units will be paid / charged under e Direct Plan. The AMC shall charge e invement management and advisory fees and e total recurring expenses of e Scheme in accordance wi e limits prescribed from time to time under e SEBI Regulations. Expenses over and above e prescribed ceiling will be borne by e AMC / Truee / Sponsor. The current expense ratios will be updated on e Fund's website, www.motilaloswal.com/asset-management wiin two working days mentioning e effective date of e change. Actual expenses for e previous financial year 2013-14 (Unaudited): Regular Plan 2.85% Direct Plan 1.85% Motilal Oswal MOSt Focused 25 Fund I) Load Structure Type of Load Entry Exit (ii) Recurring expenses Load chargeable (as %age of NAV) NIL NIL SEBI has prescribed e maximum annual recurring expenses at can be charged to e Scheme. Annual Scheme Recurring Expenses shall be wiin e limits ated in Regulations 52(6) and subject to a percentage limit of Daily Net Assets as ated below: Fir Rs.100 crore 2.50% Next 300 crores- 2.25% Next 300 crores- 2.00% Over 700 crores 1.75% Note: Atlea 0.70% of TER is charged towards diribution/commission under Regular Plan. The TER of Direct plan will be lowered to e extent of above mentioned diribution/commission which is charged in Regular plan. In addition to e recurring expenses specified for e Scheme, e following expenses/ Service Tax may also be charged under e Scheme: a) Expenses in respect of inflows from beyond top 15 cities - a maximum charge of 0.30% on e daily net assets computed as per e guidelines issued by SEBI for meeting diribution expenses incurred for bringing inflows from such cities. b) Expenses not exceeding 0.20% p.a. of daily net assets towards Invement Management and Advisory Fees and e various sub-heads of recurring expenses mentioned under Regulation 52 (2) & (4) of SEBI (MF) Regulations respectively; c) Brokerage and transaction cos not exceeding 0.12% of e value of trades in case of cash market transactions; and d) Service Tax on Invement Management and Advisory Fees. Actual expenses for e previous financial year 2013-14 (Unaudited): Regular Plan 1.74% Direct Plan 1.65% For furer details, please refer to e SID. Motilal Oswal MOSt Ultra Short Term Bond Fund (I) Load Structure: Type of Load Entry Exit (ii) Recurring Expenses: Load chargeable (as %age of NAV) NIL NIL SEBI has prescribed e maximum annual recurring expenses at can be charged to e Scheme. Annual Scheme Recurring Expenses shall be wiin e limits ated in Regulations 52(6) and subject to a percentage limit of Daily Average Net Assets as in e table below: Fir `100 crore - 2.25% Next `300 crores- 2.00% Next `300 crores- 1.75% Over Rs.700 crore 1.50% 9