1

DECIMAL WEALTH PARTNERS PVT LTD

Portfolio Manager SEBI Registration No.: INP000006013

Principal Office:

PLOT NO 34, SECTOR 32, FIRST FLOOR

GURUGRAM, HARYANA, INDIA 122001

Registered Office:

201, 2ND FLOOR, NAVNEELAM BLDG.,PLOT 108, DR. R. G. THADANI MARG,

WORLI, MUMBAI, MAHARASHTRA, INDIA 400018

E-mail: info@decimalfund.in

www.decimalfund.in

2

DISCLOSURE DOCUMENT

(As per the requirement of Fifth Schedule of Regulation14 of Securities and

Exchange Board of India (Portfolio Managers)

Regulation1993)

We confirm that:

I. The Disclosure Document (hereinafter referred to as “the Document”) hasbeen filed with

the Securities and Exchange Board of India (SEBI) along with the certificate in the

prescribed format in terms of Regulation 14 of the SEBI (Portfolio Managers)

Regulations,1993.

II. The purpose of the Document is to provide essential information about the portfolio

services in a manner to assist and enable the investors in making informed decision for

engaging Decimal Wealth Partners Private Limited as a Portfolio Manager.

III. The necessary information about the Portfolio Manager required by an investor before

investing, and the investor is advised to retain the document for future reference.

IV. The name, phone number, email address of the principal officer so designated by the

Portfolio Manager is:

Name of the Principal Officer Mr Abhishek Goyal Phone +91-99715-35999 Email abhishek@decimalfund.in

Address Plot No 34, Sector 32, 1st floor

Gurgaon, Haryana - 122001

Date:

3

Index

Item

No. Contents Page No.

1 Disclaimer 4

2 Definitions 4-5

3

Description

I. History, Present Business and Background of the Portfolio

Manager

II. Promoters of the Portfolio Manager, directors and their

background

III. Details of the services being offered

6-7

4

Penalties, pending litigation or proceedings, findings of inspection or

Investigations for which action may have been taken or initiated by any

regulatory authority

8

5 Services Offered 8-10

6 Risk Factors 10-12

7 Client Representation 12

8 Financial Performance of Portfolio Managers 13

9 Portfolio Management Performance of Portfolio Managers 13-14

10 Nature of Expenses 14-15

11 Taxation 16-19

12 Accounting Policies 19-20

13 Investor Services 20-21

14 General 21-23

4

1) Disclaimer:

The particulars given in this Document have been prepared in accordance with the SEBI

(Portfolio Managers) Regulations, 1993 as amended from time to time and filed with SEBI.

This Document has neither been approved nor disapproved by SEBI nor has SEBI certified the

accuracy or adequacy of the contents of the document.

2) Definitions:

Unless the context or meaning thereof otherwise requires, the following expressions shall

have the meaning assigned to them here under respectively:

(a) “Act” means the Securities and Exchange Board of India, Act 1992 (15 of1992)

(b) “Agreement” means agreement between the Portfolio Manager and its Client and shall

include all Schedules and Annexures attached thereto.

(c) “Application” means the application made by the Client to the Portfolio Manager with the

Portfolio Manager for Portfolio Management Services. Upon execution of the Agreement by

the Portfolio Manager, the Application shall be deemed to form an integral part of the

Agreement. Provided that in case of any conflict between the contents of the Application and

the provisions of the Agreement, the provisions of the Agreement shall prevail. (d) “Assets” means (i) the Portfolio and/or (ii) the Funds.

(e) “Body Corporate” shall have the meaning assigned to it in or under clause (11) of section 2

of the Companies Act, 2013.

(f) “Bank Account” means one or more accounts opened, maintained and operated by the

Portfolio Manager with any of the Scheduled Commercial Banks in accordance with the

agreement entered into with the Client.

(g) “Board” means the Securities and Exchange Board of India established under sub-section (1) of Section 3 of the Securities and Exchange Board of India Act.

(h) “Client” means the person who enters into an Agreement with the Portfolio Manager for

managing its portfolio and/or funds.

(i) “Customised” refers to concentration of risk, and therefore a Customised portfolio will have

lesser stocks.

(j) “Custodian” means any person who carries on or proposed to carry on the business of

providing custodial services in accordance with the regulations issued by SEBI from time to

time.

(k) “Depository Account” means one or more account or accounts opened, maintained and

operated by the Portfolio Manager with any depository participant registered under the SEBI

(Depositories and Participants) Regulations, 1996 in accordance with the agreement entered

with the Client.

(l) “Discretionary Portfolio Management Services” means the portfolio management services

rendered to the Client by the Portfolio Manager on the terms and conditions contained in

the agreement, where under the Portfolio Manager excuses any degree of discretion in the

investments or management of assets of the Client.

(m) “Discretionary Portfolio Manager” means a Portfolio Manager who exercises or may, under

a contract relating to portfolio management, exercise any degree of discretion as to the

investments or management of the portfolio of securities or the funds of the Client, as the

case maybe.

5

(n) “Diversified” refers to the spreading of risk, and therefore a diversified portfolio will have a

larger number of stocks.

(o) “Document” means this Disclosure Document.

(p) “Financial Year” means the year starting from April 1 and ending on March 31 of the following

year.

(q) “Funds” means the monies managed by the Portfolio Manager on behalf of the Client

pursuant to Portfolio Investment Management Agreement and includes the monies

mentioned in the Application, any further monies placed by the Client with the portfolio

Manager for being managed pursuant to Portfolio Investment Management Agreement, the

proceeds of the sale or other realization of the Portfolio and interest, dividend or other

monies arising from the Assets so long as the same is managed by the Portfolio Manager.

(r) “Funds Managed” refers to the Initial corpus plus or minus booked profits / losses,

income accrued and received, and any mark to market of profits or losses on outstanding

positions, less expenses incurred.

(s) Non-discretionary portfolio management services mean any services rendered to the client

by the portfolio manager in accordance with the direction of the client with respect to

investments or management of assets of the client.

(t) “Net returns” always refer to pretax returns and pertain to Profit computation for

realised profits or losses, marked to market profits or losses on outstanding investments

and realized or accrued incomes less Management fees collected on a monthly basis and

expenses such as brokerage, STT, Statutory stamp duties, turnover fees, government

taxes, DP charges etc. and any audit/other or SEBI filing expenses done on behalf of the

client.

(u) “Parties” means the Portfolio Manager and the Client; and “Party” shall be construed

accordingly.

(v) “Person” includes any individual, partners in partnership, central or state government,

company, body corporate, cooperative society, corporation, trust, society, Hindu Undivided

Family or any other body of persons, whether incorporated or not.

(w) “Portfolio” means the Securities managed by the Portfolio Manager on behalf of the Client

pursuant to the Portfolio Investment Management Agreement and includes any Securities

mentioned in the Application, any further Securities placed by the Client with the Portfolio

Manager for being managed pursuant to the Portfolio Investment Management Agreement,

Securities acquired by the Portfolio Manager through investment of Funds and bonus and

rights shares or otherwise in respect of Securities forming part of the Portfolio, bank balance,

so long as the same is managed by the Portfolio Manager.

(x) “Portfolio Manager” shall have the same meaning as given in regulation 2 (cb) of the SEBI

(Portfolio Managers) Regulations, 1993 as amended from time to time.

(y) “Principal Officer” means an employee of the Portfolio Manager who has been designated as

such by the Portfolio Manager.

(z) “Regulations” means the Securities and Exchange Board of India (Portfolio Managers)

Regulations, 1993, as may be amended from time to time.

(w)“Scheduled Commercial Bank” means any bank included in the second Schedule to the

Reserve Bank of India Act, 1934 (2 of1934).

(x) “SEBI” means the Securities and Exchange Board of India established under sub-section (1)

of Section 3 of the SEBI Act.

(y) “Securities” includes: “Securities” as defined under the Securities Contracts

(Regulation) Act, 1956 as amended from time to time and includes:

I. Shares, scripts, stocks, bonds, debentures, debenture stock or other

marketable securities of a like nature in or of any incorporated company or

other body corporate; II. Derivatives;

III. Units or any other instrument issued by any collective investment strategy

to the investors in such strategies;

6

IV. Security receipt as defined in clause (zg) of section 2 of the Securitization

and Reconstruction of Financial Assets and Enforcement of Securities

Interest Act, 2002;

V. Units or any other such instrument issued to the investors under any mutual fund

strategy; VI. Government securities;

VII. Such other instruments as may be declared by the Central Government to be securities;

VIII. Rights, Warrants, or interest insecurities;

IX. Exchange Traded Funds; and

X. Liquid Fund.

Words and expression used in this disclosure document and not expressly defined shall be

interpreted according to their general meaning and usage. The definitions are not exhaustive.

They have been included only for the purpose of clarity and shall in addition be interpreted

according to their general meaning and usage and shall also carry meanings assigned to them

in regulations governing Portfolio Management Services.

3) Description:

i) History, Present Business and Background of the Portfolio Manager:

Decimal Wealth Partners Pvt Ltd is a company incorporated under the Companies Act, 2013

on December 8, 2017,having its Principal Office at Plot No 34, Sector 32, Gurugram, Haryana

– 12201 and Registered Office at 210, 2nd Floor, Navneelam Building, Plot 108, DR. R. G.

Thadani Marg, Worli, Mumbai City, Maharashtra, India, 400018

ii) Promoters of the Portfolio Manager:

Directors of the Company

a) Mr. Neeraj Batra

Neeraj Batra is an Alumnus of Shri Ram College of Commerce and IIM Ahmedabad. An

investment banker he has over thirty years varied experience as Head of Treasury &

Investment Banking at Bank of America and as Country Head and advisor of the Geneva and

London based Hinduja Group for their domestic and international entities. During this period

he has advised HNIs across the globe.

Neeraj is a serial entrepreneur and runs a boutique Private Equity consulting firm Start-Up

Equity Partners Ltd which provides consulting and early stage capital. He has teaching

experience of over fifteen years and has taught courses on Global Economics and Wealth

Management in leading Business Schools and forums. In 2017 he created the Wealth Guild

for Women.

b) Mr. Abhishek Goyal

Abhishek Goyal graduated from the University of Virginia with a degree in Finance and

Economics in 2002. Post that he joined Andor Capital Management (Hedge Fund with $11B

AUM) in Manhattan covering technology companies.

In 2008, Abhishek moved to Hong Kong to setup Andor’s office and invest in Asian companies.

In 2009, he joined White Elm Capital ($700M AUM) to manage their $80M India portfolio.

Abhishek is one of the co-founders of OnCourse Vantage. He is also an avid Angel investor

7

and has invested in a host of start-ups.

c) Mr. Akhil Daswani

Akhil Daswani is a graduate of Northwestern University with a BA in Economics and Business

Institutions. After spending time working at Goldman Sachs in Chicago, he moved back to

India to co-found Oncourse Vantage, an alternate education and consulting company.

Akhil has been active in the capital markets over the past 10 years. He is passionate about

Equity Research. As co-Founder at Decimal Wealth Management he is involved in managing

client relations and meeting potential Investee companies.

Key Persons of the Company (Portfolio Management Services):

Neeraj Batra: Co-Founder & Chairman

Samir Arora: Non-Executive Founder

AbhishekGoyal: Co-Founder &Principal Officer

Akhil Daswani: Co-Founder & COO

Sanjay Gopal: Compliance Officer

iii) Details of the services being offered

The Portfolio Manager offers service under the following category:

a) Discretionary Services:

Under these services, the discretion pertaining to investment/disinvestments decisions on an

on-going basis rest solely with the Portfolio Manager. The Portfolio Manager shall have the

sole and absolute discretion to invest in respect of the Client’s account in any type of security

as per the Client agreement and make such changes in the investments and invest some or

all of the Client’s account in such manner and in such markets as it deems fit. The securities

invested/disinvested by the Portfolio Manager for Clients in the same Offering/Option may

differ from one Client to another Client, based on corpus size, strategy chosen, and timing of

investment. The Portfolio Managers’ decision taken in good faith towards deployment of the

Clients’ account is absolute and final and can never be called in question or be open to review

at any time during the currency of the Client agreement or any time thereafter except on the

ground of malafide, intent, fraud, conflict of interest or gross negligence. This right of the

Portfolio Manager shall be exercised strictly in accordance with the Regulations. Periodical

statements in respect of Client’s Portfolio shall be made available to the respective Clients.

Investment objective may vary from Client to Client.

Depending on the individual client requirements, the portfolio can also be tailor made based

on the client specification.

4) Penalties, pending litigation or proceedings, findings of inspection or investigations for

which action may have been taken or initiated by any regulatory authority:

No penalties / directions have been issued by the SEBI under the SEBI Act or Regulations

made there under relating to Portfolio Management Services. There are no pending material

litigations or legal proceedings, findings of inspections or investigations for which action has

been taken or initiated by any regulatory authority against the Portfolio Manager or its

8

Directors, principal officers or employees or any person directly or indirectly connected with

the Portfolio Manager under the SEBI Act and Regulations made there under relating to

Portfolio Management Services.

1 All cases of penalties imposed by the Board or the directions issued by the

Board under the Act or Regulations made there under relating to Portfolio

Management Services.

N.A

2 The nature of the penalty/direction. N.A

3

Penalties imposed for any economic offence and/or for violation of any securities laws relating to Portfolio Management Services. N.A

4

Any pending material litigation/legal proceedings against the Portfolio

Manager/key personnel with separate disclosure regarding pending criminal

cases, if any.

N.A

5

Any deficiency in the systems and operations of the Portfolio Manager observed

by the Board or any regulatory agency in relation to Portfolio Management Services for which action may have been taken or initiated.

N.A

6

Any enquiry/adjudication proceedings initiated by the Board against the

Portfolio Manager or its directors, principal officer or employee or any person

directly or indirectly connected with the Portfolio Manager or its directors,

principal officer or employee, under the Act or Regulations made there under

relating to Portfolio Management services.

N.A

5) Services Offered:

The Portfolio Manager intends to manage the Assets of the Client using the following

strategy:

a) Diversified Strategy

Fund Manager: Investment Committee comprising Neeraj Batra and Abhishek Goyal

It is agreed that the final objective will be to try and maximize the value of the Client’s

investments. This may include frequent decisions to exit and investment given the state of

the markets and the economy in the judgment of the Portfolio Manager. The Portfolio

Manger will adopt a strategy of investing primarily in Equity or equity linked investments.

Whereas the client agrees and confirms that the investments will be for both Long & Short

term benefits. The Client agrees to leave it to the discretion and judgment of the

Portfolio manager to buy and sell shares, invest in liquid funds, short-term deposits and

invest in other equity linked products/instruments.

The Client understands and confirms that the Portfolio manager may make Investments with

a long term or short-term period based on their judgment and discretion. The Client also

understands that the Portfolio Manager may choose to sit on cash for periods as per their

discretion and judgment.

Features:

· Minimum Portfolio Size: Above Rs 25 Lakhs

· A minimum of 25 scrips and maximum of 35 scrips

· Maximum weightage per scrip will be 12%

9

· Weighted average cash of approximately 10%

· Turnover of 1x – 5x per year

b) Customised Strategy

Fund Manager: Investment Committee comprising Neeraj Batra and Abhishek Goyal

It is agreed that the final objective will be to try and maximize the value of the Client’s

investments. This may include frequent decisions to exit and investment given the state of

the markets and the economy in the judgment of the Portfolio Manager. The Portfolio

Manger will adopt a strategy of investing primarily in Equity or equity linked investments.

Whereas the client agrees and confirms that the investments will be for both Long & Short

term benefits. The Client agrees to leave it to the discretion and judgment of the

Portfolio manager to buy and sell shares, invest in liquid funds, short-term deposits and

invest in other equity linked products/instruments.

The Client understands and confirms that the Portfolio manager may make Investments with

a long term or short-term period based on their judgment and discretion. The Client also

understands that the Portfolio Manager may choose to sit on cash for periods as per their

discretion and judgment.

Features:

Customised Accounts will have to options (C+ and C) based on the following criteria

• Minimum Portfolio Size: Above Rs. 25 Lakhs

• A min of 10 scrips and maximum of 20 scrips

• Maximum weightage per scrip will be 30%

• Weighted average cash of approximately 15%

▪ The Investment Committee may decide to make use of options

▪ The two options are

▪ C+ (Larger number of shares, less Customised) or

▪ C (Lesser number of shares, more Customised)

NOTE:

· Investment under Portfolio Management Services will be only as per the SEBI Regulations on

PMS

· The un-invested amounts forming part of the Client's Assets may be at the discretion of the

Portfolio Manager be held in cash or deployed in Liquid funds, Exchange Traded Index Funds,

debt oriented options of Mutual funds, Gilt strategies, Bank deposits and other short term

avenues for Investment.

· The Portfolio Manager, with the consent of the Client, may lend the securities through an

Approved Intermediary, for interest.

· The Portfolio Manager will not invest any of the funds of the Client in the shares, mutual

funds, debt, deposits and other financial instruments of group companies of the Portfolio

Manager.

6) Risk Factors:

10

The investments made in securities are subject to market risk and there is no assurance or

guarantee that the objectives of investments will be achieved. Following are the risk factors

as perceived by management:

· The Client is not being offered any guaranteed/assured returns or any guarantee of capital

nor income or returns or capital appreciation.

· The Past Performance of the investments made/recommended by the Portfolio Manager

shall not be construed as an indication of future results, which may prove to be better or

worse than the past. The Investments made by the Portfolio Manager may go up or down in

value, depending on the market conditions.

· Investment in equities, derivatives and mutual funds and Exchange Traded Index Funds are

subject to market risks and there is no assurance or guarantee that the objective of

investments will be achieved.

· The Client confirms that the Portfolio Manager will not be responsible for any loss or

damage occasioned by, including not limited to market conditions, force majeure

circumstances, delays on part of companies or other authorities including government

authorities, errors of judgment on the part of Decimal, its Founders, employees and/or

acts of other intermediaries, custodians and other external agencies or other factors

beyond the knowledge or control of the Portfolio Manager.

· As with any investment in securities, the Net Asset Value of the portfolio can go up or down

depending upon the factors and forces affecting the capital markets.

· Investments in securities involves certain risks and the value of investments may be affected

generally by factors affecting capital markets, such as price and volume, volatility in the stock

market, foreign investments, interest rates, changes in government policies, taxation,

political, economic or other developments and closure of the stock exchange.

· The past performance of the Portfolio Manager does not indicate its future performance.

Investors are not being offered any guaranteed returns.

· The performance of the Assets of the Client may be adversely affected by the performance

of individual securities, changes in the market place and industry specific and macroeconomic

factors. The investment strategies are given different names for convenience purpose and

the names of the Strategies do not in any manner indicate their prospects or returns.

· Investments in debt instruments and other fixed income securities are subject to default risk,

liquidity risk and interest rate risk. Interest rate risk results from changes in demand and

supply for money and other macroeconomic factors and creates price changes in the value

of the debt instruments. Consequently, the Net Asset Value of the portfolio may be subject

to fluctuation.

· Investments in debt instruments are subject to reinvestment risks as interest rates prevailing

on interest amount or maturity due dates may differ from the original coupon of the bond,

which might result in the proceeds being invested at a lower rate.

· The Portfolio Manager may invest in non-publicly offered debt securities, unlisted equities

and equity warrants. This may expose the Client's portfolio to liquidity risks.

· Engaging in securities lending is subject to risks related to fluctuations in collateral

11

value/settlement/liquidity/ counterparty.

· The Portfolio Manager may use derivatives instruments like index futures, stock futures and

options contracts, warrants, convertible securities, swap agreements or any other

derivative instruments for the purpose of hedging and portfolio balancing, as permitted

under the Regulations and guidelines. Usage of derivatives will expose the Portfolio to

certain risks inherent to such derivatives. As and when the Portfolio Manager deals in the

derivatives market on behalf of the Client, there are risk factors and issues concerning the

use of derivatives that investors should understand.

· Derivative products are specialized instruments that require investment techniques and risk

analyses different from those associated with stocks and bonds. The use of a derivative

requires an understanding not only of the underlying instrument but of the derivative itself.

Derivatives require the maintenance of adequate controls to monitor the transactions

entered into, the ability to assess the risk that a derivative adds to the portfolio and the

ability to forecast price or interest rate movements correctly. There is the possibility that a

loss may be sustained by the portfolio as a result of the failure of another party (usually

referred to as the “counter party”) to comply with the terms of the derivatives contract.

Other risks in using derivatives include the risk of mispricing or improper valuation of

derivatives and the inability of derivatives to correlate perfectly with underlying assets,

rates and indices. Thus, derivatives are highly leveraged instruments. Even a small price

movement in the underlying security could have a large impact on their value.

· There are inherent risks arising out of investment objectives, investment strategy, asset

allocation and non-diversification of portfolio.

· The Net Asset Value may be affected by changes in settlement periods and transfer

procedures.

· After accepting the corpus for management, the Portfolio Manager may not get an

opportunity to deploy the same time or there may be some delay in deployment. In such

situation the Clients may suffer an opportunity loss.

· The Client understand that the Portfolio Manager is in no way responsible for any delays

experienced in the purchase of shares due to illiquidity of the market, settlement and

realization of sale proceeds and the registration of any securities transfer and any delays in

receiving cash and scrip dividends and resulting delays in reinvesting them. The Client

understands and approves that Edelweiss Securities is the current broker and custodian of

the Portfolio manager

· The Client has been informed, understood and agreed that Decimal or its Fund Managers,

employees and stakeholders, and or their families, may invest its own funds in the capital

markets. The client further agrees that Decimal or its Fund Managers may hold and or

invest in the same securities / or additional securities and shares as those invested in the

Client’s portfolio by the Portfolio Manager.

7) Client Representation

a) Details of Client Accounts Activated

As on 30/09/19

12

Category of Clients No. of Clients Funds Managed (In Crs.)

Associate Companies/Related

Parties 13 46.8457

Others (Active) 14 19.6553

Total 27 66.5010

Details of Associate Companies/Related Parties as on 30/09/19

Sr No. Name AUM (In Crs.)

1 Alisha Mashruwala 0.7905

2 Infinity Trust Investments Pvt Ltd 8.8767

3

Harki Properties and Investments Pvt

Ltd 3.4056

4 Indo Nippon Foods Pvt Ltd 1.3270

5 Jayshree Goyal 3.0026

6 Mahesh Daswani 0.9719

7 Neha Daswani 0.7938

8 Oncourse Vantage Pvt Ltd 2.8059

9 Radhika Batra 1.1455

10 Reena Dewan 4.2945

11 Samir Arora 10.6268

12 Sanjana Batra 4.5131

13 Sonali Batra 4.2918

b) Appointment of Custodian and Fund Accountant:

Decimal Wealth Partners Pvt Ltd may appoint a custodian and/or fund accountant for its PMS

services. Currently, Edelweiss Custodial Services has been appointed as custodian.

8) The financial performance of Portfolio Manager. (Based on audited financial statements)

Financial highlights of Decimal Wealth Partners Private Limited for the last 2 Years are

given as under:

Particulars Year Ended

31st March 2019

(Rs. In Lakhs)

Period Ended from

08th December 2017

to

31st March 2018

13

(Rs. In Lakhs)

Total Income 4307.69 0

Total Expenditure 4398.03 14.43

Profit / (Loss) before

depreciation and tax

(90.34) (14.43)

Less: Depreciation (0.34) 0

Provision for Tax 0 0

Deferred Tax Assets 8.59 0

Profit / (Loss) for the

year after tax

(82.09) (14.43)

9) Portfolio Management Performance of Portfolio Managers:

Return on Investment from 01/04/19 - 30/09/19:

Strategy Customised

(Weighted Return)

Diversified (Weighted

Return)

Portfolio

Return

-16.22% -20.89%

CNX 500

Return

-3.34% -3.34%

Return on Investment from 01/10/18 - 31/03/19:

Strategy Customised

(Weighted Return)

Diversified (Weighted

Return)

Portfolio

Return

12.45% 12.84%

CNX 500

Return

6.01% 6.01%

Return on Investment from 21/06/18 - 30/09/18:

Strategy Customised

(Weighted Return)

Diversified (Weighted

Return)

Portfolio

Return

-13.89% -20.02%

CNX 500

Return

-1.73% -1.73%

14

10) Nature of Expenses:

I. Management Fees:

Management Fees will be debited at the end of each month, calculated on the basis of the daily

average NAV by the Portfolio Manager’s Custodian, Edelweiss Custodial Services. Such calculation is

done net of any expense including but not restricted to brokerage, STT, Statutory stamp duties,

turnover fees, government taxes, DP charges and any audit or SEBI filing done on behalf of the

client. Portfolio Value factored in calculation, will be gross of TDS.

II. Performance Fees:

Performance Fees will be charged annually and will be net of all expenses and will be charged

once the net return crosses the hurdle rate laid out in the fee structure table below

CAPITAL ALLOCATION AND FEE STRUCTURE

INVESTMENT STYLE SELECTED AMOUNT (in

Rs)

FEE STRUCTURE

Diversified (D)

· Management Fee of 2% p.a. charged at the

end of each month, on the basis of the

Average Weighted Funds managed

through the month.

· Hurdle Rate of 10% Net Pretax and High

Hurdle Rate of 25% Net Pretax

· The Hurdle rate is calculated after

factoring in management fees, brokerage

and all other out of pocket expense. This

will be charged on an annual basis or as

applicable.

· Performance Fee of 15% on return

between 10% and 25%

· Performance fee of 30% on return beyond

25%

· Pre-mature exit load of 3% of the

Portfolio Value before 12 months, 2%

before 24 months, but after 12 months

and 1% before 36 months, but after 24

months. No exit load post 36 months.

Customised (C or C+) · Management Fee of 2% p.a. charged at the

end of each month, on the basis of the

Average Weighted Funds managed

through the month.

· Hurdle Rate of 10% Net Pretax and High

Hurdle Rate of 25% Net Pretax

· The Hurdle rate is calculated after

factoring in management fees, brokerage

and all other out of pocket expense. This

will be charged on an annual basis if

applicable.

· Performance Fee of 15% on return

between 10% and 25%

· Performance fee of 30% on return beyond

25%

15

III. Custodian Fees:

As may be decided between the Client and the Portfolio Manager

IV. Registrar & Transfer Agent Fees:

A fee payable to the Registrar and Transfer Agents for effecting transfers of Securities and

includes stamp charges, notary charges, cost of affidavits, courier, post etc.

IV. Brokerage:

Brokerage charges for market operations would not exceed 0.125% exclusive of other

incidental charges like GST, STT, Turnover Fee, DP charges etc which will be charged to the

Client at actuals.

V. Goods & Services Tax:

As may applicable from time to time.

VI. Depository Charges:

As may be applicable from time to time.

VII. Entry and Exit Load

As laid out in the fee structure table, Pre-mature exit load of 3% of the Portfolio Value

before 12 months, 2% before 24 months, but after 12 months and 1% before 36 months,

but after 24 months. No exit load post 36 months.

VIII. Certification and Professional Charges:

Charges payable for out sourced professional services like accounting, auditing, taxation and

legal services etc. for documentation, notarizations, certifications, attestations required by

bankers or regulatory authorities including legal fees etc.

11) Taxation

The information given hereinafter is only for general information purpose and is based on

the law and practice currently in force in India and the Investors should be aware that the

relevant fiscal rules or their interpretation may change from time to time.

The portfolio gains in an account could be in the nature of capital gains (either short- term

or long-term depending upon the holding period) or business income depending on the

status and intent of the client.

· Pre-mature exit load of 3% of the

Portfolio Value before 12 months, 2%

before 24 months, but after 12 months

and 1% before 36 months, but after 24

months. No exit load post 36 months.

16

In view of the above, and since the Individual nature of tax consequences may differ in

each case on its merits and facts, each investor is advised to consult his/ her or its own

professional tax advisor with respect to the specific tax implication arising out of its

participation in the PMS as an investor. The portfolio manager shall not be responsible for

assisting in or completing the fulfillment of the Client’s tax obligations.

The following are the tax provisions applicable to Clients investing in the Portfolio

Management Services under the taxation laws as on the date herewith and are subject to

applicable Finance Act from time to time

(i) Advance Tax Installment Obligations:

It shall be the Client's responsibility to meet the obligation on account of advance tax

installments payable on the due dates under the Income tax Act, 1961. With effect from

June 1, 2016, the advance tax installments have been revised in the manner prescribed

in the below mentioned table and the same is applicable to all the clients except for the

eligible persons carrying out an eligible business as referred to in section 44AD of the

Income Tax Act, 1961.

Due Date of Installment Amount payable

On or before the 15th June At least 15% of the advance tax

payable

On or before the 15th September At least 45% of the advance tax

payable

On or before the 15th December At least 75% of the advance tax

payable

On or before the 15th March 100% of the advance tax payable

(ii) Short Term Capital Gains

Short-term capital gain means capital gain arising from the transfer of a short-term capital

asset. Short term capital asset being shares held in a company or any other security (

other than a unit ) listed on a recognized stock exchange in India or a unit of the Unit

Trust of India established under the Unit Trust of India Act, 1963 (52 of 1963) or a unit

of an equity oriented fund set up under a option of Mutual Fund specified under clause

(23D) of Section 10 or a zero coupon bond, means a capital asset held by an assesse for not

more than twelve months immediately preceding the date of its transfer. Any other

capital assets other than referred above, the same will be treated as short-term capital

assets if it is held for a period not more than thirty-six months immediately preceding the

date of its transfer.

With effect from April 1, 2017, unlisted shares held in a company will be treated asshort

term capital assets if it is held by an assesse for not more than twenty-four months

immediately preceding the date of its transfer.

As per Section 111A short term capital gain, arising on transfer of equity shares in a

company or a unit of an equity oriented fund will be charged to income tax @15% (plus

applicable surcharge & education cess, if any) provided such transaction has been

subjected to Securities Transaction Tax (STT). Other short term capital gains will be taxed

at the normal rates as given in the respective regulations.

(iii) Short Term Capital Losses:

17

Section 94(7) of the Income Tax Act, 1961 provides that losses arising from the sale or

transfer of units purchased within 3 months prior to the record date fixed for declaration of

dividendor income on units and sold within 9 months after such date, will be disallowed to

the extent of the dividend or the income distribution on such units claimed as tax exempt

by the unit holder.

Section 94(7) of the Income Tax Act, 1961 also provides that losses arising from the sale or

transfer of securities purchased within 3 months prior to the record date fixed for

declaration of dividend or income on such securities and sold within 3 months after such

date, will be disallowed to the extent of the dividend or the income distribution on such

securities is claimed as tax exempt by the holder of the securities. As per this Section,

securities include stocks and shares.

In addition to above, Section 94(8) of the Income Tax Act, 1961 provides that in case of

units purchased within a period of 3 months prior to the record date fixed for entitlement

of additional units and additional units are allotted without payment and if the original

units are sold or transferred within 9 months after such date, the loss arising on such

transfer of original units shall be ignored for the purpose of computing the income

chargeable to tax and will be treated as cost of acquisition of such additional units.

As per section 70 read with section 71 and section 74 of the Income Tax Act, 1961, short-

term capital loss arising during a year is allowed to be set-off against short-term as well as

long-term capital gains of the said year. Balance loss, if any, should be carried forward and

set-off against short-term as well as long-term capital gains for subsequent 8 years

(iv) Long Term Capital Gain:

As per the earlier provisions under Section 10 (38), Long Term Capital Gains on sale of

Equity Shares in a company or units of Equity Oriented Funds are exempt from income tax

provided such transactions are entered on a recognized stock exchange or such units are

sold to the Mutual Fund and such transactions are chargeable to STT. However, the Finance

Bill 2018 amended the said provision by proposing tax on the Long Term Capital Gains

exceeding Rs.1 lakh at the rate of 10 percent, without allowing any indexation benefit.

However, all gains up to 31stJanuary, 2018 will be exempt from such tax. Further, a tax on

distributed income by equity-oriented mutual funds is introduced at the rate of 10 percent.

Exemption does not Apply

In respect to capital gains not exempted under section 10(38), the provisions for taxation of

long-term capital gains for different categories of assessees are explained hereunder:

For Individuals & HUF’s

Long Term Capital Gains in respect of capital asset held for a period longer than 12 months

will be chargeable under section 112 of the Income Tax Act, 1961 at the rate of 20% plus

education cess, as applicable. Capital gains would be computed after taking into account

cost of acquisition as adjusted by Cost Inflation Index notified by the Central Government

and expenditure incurred wholly & exclusively in connection with such transfer.

In Case where taxable income as reduced by long term capital gains is below the exemption

limit, the long-term capital gains will be reduced to the extent of the shortfall and only the

balance long term capital gains will be charged at the flat rate of 20% plus education cess,

as may be applicable.

18

Long Term Capital Gains in respect of shares of an unlisted company held for a period of

more than 24 months will be chargeable under section 112 of the Income Tax Act, 1961 at

the rate of 20% plus education cess, as applicable.

As per Finance Act, 2017, the base year for indexation purpose has been shifted from 1981

to 2001 to calculate the cost of acquisition or to take fair market value of the asset as on

that date. Further, it provides the cost of acquisition of an asset acquired before 1st April,

2001 shall be allowed to be taken as fair market vale as on 1st April, 2001.

For Indian Companies

Long Term Capital Gains in respect of capital asset held for a period longer than 12 months

will be chargeable under section 112 of the Income Tax Act, 1961 at the rate of 20% plus

education cess, as applicable. Capital gains would be computed after taking into account

cost of acquisition as adjusted by Cost Inflation Index notified by the Central Government

and expenditure incurred wholly & exclusively in connection with such transfer.

Long Term Capital Gains in respect of shares of an unlisted company held for a period of

more than 24 months will be chargeable under section 112 of the Income Tax Act, 1961 at

the rate of 20% plus education cess, as applicable.

For Non-resident Indians

Under section 115E of the Income Tax Act, 1961, income of Non-Resident Indians by way of

long-term capital gains in respect of the specified assets purchased in foreign currency as

defined under section 115C (which includes shares, debentures, deposits, in an Indian

company and securities issued by Central Government) is chargeable at the rate of 20%

plus applicable surcharge and cess. Such long-term capital gains would be calculated

without indexation of the cost of acquisition. Income by way of long-term gain in respect of

unlisted securities is chargeable at the rate of 10% and cess.

Long term capital gains arising to a non-resident from transfer if unlisted securities or

shares of a company, not being a company in which public are substantially interested,

subject to 10% tax (without benefit of indexation and foreign currency fluctuation). As per

Finance Act, 2017 this concessional rate shall be applicable w.e.f 1stApril, 2012.

(v) Securities Transaction Tax (STT):

a) STT is the tax leviable on the taxable securities transactions i.e. transaction of:

b) Purchase or sale of equity share of listed companies, entered into in recognized stock

exchange and settled by the actual delivery. The STT on such transaction is payable

by the purchaser/seller, as the case may be, @0.1%.(w.e.f 1-07-2012)

c) Sale of a unit of equity oriented fund, entered into in recognized stock exchange and

settled by the actual delivery. The STT on such transaction is payable by the seller,

as the case may be,@ 0.001%.(w.e.f 1-06-2013)

d) Sale of an equity share of listed companies or a unit of an equity oriented fund,

entered into in a recognized stock exchange and settled otherwise than by actual

delivery. The STT on such transaction is payable by the seller @ 0.025%.

e) STT on a sale of an options in securities is payable by the seller@ 0.05%. STT on sale

of an option in securities, where option is exercised, is payable by the purchaser@

0.125% of the settlement price of the option.

19

f) STT on a sale of a futures in securities is payable by the seller@ 0.01%

g) In case of unlisted equity shares under an offer for sale referred to in sub clause

(aa) of clause (13) of section 97, the seller will pay STT @ 0.2% (from 01-07-2012)

h) If the total income of an assessee in a previous year includes any income,

chargeable under the

i) head "Profits and gains of business or profession", and if it is arising from taxable

securities transactions, the Securities Transaction Tax paid would be allowed as a

deduction under Section 36(1)(xv).

(vi) Tax Treatment if STT is Not Paid:

The income arising from the securities transactions shall be taxed at applicable rates in

force under the Income Tax Act, 1961, if, transaction is not through recognized Stock

Exchange and STT is not paid in respect of such transactions.

(vii) Tax Treatment on Interest Income:

Pursuant to Section 56 (2) (id) of Income Tax Act, 1961, income by way of Interest, if not

chargeable to income tax under the head "Profit and Gains of Business or Profession", shall

be chargeable to Income Tax under the head 'Income from other sources'. The same shall

be taxed

12) Accounting Policies:

The following Accounting policy will be applied for the investments of Clients:

a) Investments in Equities, Mutual funds, Exchange Traded Funds and Debt instruments will

be valued at closing market prices of the exchanges (BSE or NSE as the case may be) or

the Repurchase Net Asset Value declared for the relevant strategy on the date of the

report or any cut off date or the market value of the debt instrument at the cut off date.

Alternatively, the last available prices on the exchange or the most recent NAV will be

reckoned. In case of structured products, the portfolio will be valued at the face value of

the product until the expiry of the tenure.

b) The Books of Account of the Client is maintained on an historical cost basis.

c) Realized gains / losses will be calculated by applying the first in / first out method.

d) For derivatives and futures and options, unrealized gains and losses will be calculated by

marking to market the open positions.

e) Unrealized gains / losses are the differences between the current market values / NAV

and the historical cost of the securities/price at which securities are valued on the date

of admitting as a Corpus.

f) Dividend on equity shares and interest on debt instruments shall be accounted on accrual

basis. Other income like bank interest, interest on FD etc shall also be accounted on

receipt basis.

g) Bonus shares are recorded on the ex-benefit date (ex-date).

h) Right entitlement shall be recognized only when the original shares on which the right

20

entitlement accrues are traded on the stock exchange on an ex-rights basis.

i) The cost of investment acquired or purchased shall include brokerage, stamp duty and

any charge customarily included in the brokers cost note/bought note.

The Accounting Policies and Standards as outlined above are subject to changes made from

time to time by Portfolio Manager. However, such changes would be in conformity with the

Regulations.

13) Investor Services:

I. Details of investor relation officer who shall attend to the investor queries

and complaints is mentioned herein below:

Name of the person Mr Abhishek Goyal

Designation Principal Officer

Address 1st Floor, Plot No 34, Sector 32, Gurugram, Haryana - 122001

Email abhishek@decimalfund.in Telephone 99715-35999

II. Grievance redressal and dispute settlement mechanism:

Grievances, if any, that may arise pursuant to the Portfolio Investment Management

Agreement entered into shall as far as possible be redressed through the administrative

mechanism by the Portfolio Manager and are subject to SEBI (Portfolio Managers)

Regulations 1993 and any amendments made thereto from time to time. However, all the

legal actions and proceedings are subject to the jurisdiction of court in Mumbai only and are

governed by Indian laws.

For grievances point of contact will be Mr. Sanjay Gopal

The Portfolio Manager will endeavor to address all complaints regarding service deficiencies

or causes for grievance, for whatever reason, in a reasonable manner and time (i.e within 30

days of receipt of complaint). If the Investor remains dissatisfied with the remedies offered

or the stand taken by the Portfolio Manager, the investor and the Portfolio Manager shall

abide by the following mechanisms: -

All disputes, differences, claim and questions whatsoever arising between the Client and the

Portfolio Manager and/or their respective representatives shall be settled in accordance with

the provision of the Arbitration and Conciliation Act, 1996 or any statutory requirement

modification or re-enactment thereof for the time being in force. Such arbitration

proceedings shall be held in Mumbai or such other place as the Portfolio Manger thinks fit.

Without prejudice to anything stated above, the Client can also register its grievance /

complaint through SCORES (SEBI Complaints Redress System) Link-

http://scores.gov.in/Admin/, post which SEBI may forward the complaint to the Portfolio

Manager and the Portfolio Manager will suitably address the same.

21

14) General:

Foreign Account Tax Compliance Act (FATCA):

The Hiring Incentives to Restore Employment Act (the “Hire Act”) was signed into US law in

March 2010. It includes provisions generally known as FATCA. The intention of these is that

details of U.S. investors holding assets outside the US will be reported by financial institutions

to the IRS, as a safeguard against U.S. tax evasion. As a result of the Hire Act, and to

discourage non-U.S. financial institutions from staying outside this regime, financial

institutions that do not enter and comply with the regime will be subject to a 30% penalty

withholding tax with respect to certain U.S. source income (including dividends) and gross

proceeds from the sale or other disposal of property that can produce U.S. source income.

Sections 1471 through 1474 of the U.S. Internal Revenue Code impose a 30% withholding tax

on certain payments to a foreign financial institution (“FFI”) if that FFI is not compliant with

FATCA. The Company is a FFI and thus, subject to FATCA. Beginning 1 July 2014*, this

withholding tax applies to payments to the Company that constitute interest, dividends and

other types of income from U.S. sources (such as dividends paid by a U.S. corporation) and

beginning on 1 January 2017, this withholding tax is extended to the proceeds received from

the sale or disposition of assets that give rise to U.S. source dividend or interest payments.

These FATCA withholding taxes may be imposed on payments to the Company unless (i) the

Company becomes FATCA compliant pursuant to the provisions of FATCA and the relevant

regulations, notices and announcements issued there under, or (ii) the Company is subject to

an appropriate Intergovernmental Agreement to improve international tax compliance and

to implement FATCA. The Company intends to comply with FATCA in good time to ensure

that none of its income is subject to FATCA withholding or such date as may be applicable

India has entered into Inter Governmental Agreement (“IGA”) with USA on 9th July 2015 and

has notified Income Tax rules for compliance with FATCA regulations. Further, India has also

signed a multilateral agreement on June 3, 2015, to automatically exchange information

based on Article 6 of the Convention on Mutual Administrative Assistance in Tax Matters

under the Common Reporting Standard (CRS). The Portfolio Manager intends to take any

measures that may be required to ensure compliance under the terms of the IGA and local

implementing regulations. In order to comply with its FATCA/CRS obligations, the Company

will be required to obtain certain information from its investors so as to ascertain their tax

status. If the investor is a specified person, or does not provide the requisite documentation,

the Company may need to report information on these investors to the appropriate tax

authority, as far as legally permitted. If an investor or an intermediary through which it holds

its interest in the Company either fails to provide the Company, its agents or authorised

representatives with any correct, complete and accurate information that may be required

for the Company to comply with FATCA/CRS, the investor may be subject to withholding on

amounts otherwise distributable to the investor, may be compelled to sell its interest in the

Company or, in certain situations, the investor’s interest in the Company may be sold

involuntarily. The Company may at its discretion enter into any supplemental agreement

without the consent of investors to provide for any measures that the Company deems

appropriate or necessary to comply with FATCA/CRS, subject to this being legally permitted

under the IGA or the Indian laws and regulations. Other countries are in the process of

adopting tax legislation concerning the reporting of information. The Company also intends

to comply with such other similar tax legislation that may apply to the Company although the

exact parameters of such requirements are not yet fully known. As a result, the Company

may need to seek information about the tax status of investors under such other country’s

laws and each investor for disclosure to the relevant governmental authority. Investors

should consult their own tax advisors regarding the FATCA/CRS requirements with respect to

22

their own situation. In particular, investors who hold their Units through intermediaries

should confirm the FATCA/CRS compliance status of those intermediaries to ensure that they

do not suffer FATCA/CRS withholding tax on their investment returns.

Prevention of Money Laundering

Prevention of Money Laundering Act, 2002 (‘PML Act’) came into effect from July 1, 2005

vide Notification No. GSR 436(E) dated July 1, 2005 issued by Department of Revenue,

Ministry of Finance, Government of India. Further, SEBI vide its circular No.

ISD/CIR/RR/AML/1/06 dated January 18, 2006 and Master Circular dated December 31, 2010

has mandated that all intermediaries including Portfolio Managers should formulate and

implement a proper policy framework as per the guidelines on anti money laundering

measures and also to adopt a “Know Your Customer” (KYC) policy. The intermediaries may,

according to their requirements specify additional disclosures to be made by Clients for the

purpose of identifying, monitoring and reporting incidents of money laundering and

suspicious transactions undertaken by Clients. SEBI has further issued circular no.

ISD/CIR/RR/AML/2/06 dated March 20, 2006 advised all intermediaries to take necessary

steps to ensure compliance with the requirement of section 12 of the PML Act requiring inter

alia maintenance and preservation of records and reporting of information relating to cash

and suspicious transactions to Financial Intelligence Unit- India (FIU-IND). SEBI has further

strengthened the KYC and client risk assessment requirements under its circular no.

CIR/MIRSD/1/2014 dated March 12, 2014. The PMLA, Prevention of Money-laundering

(Maintenance of Records of the Nature and Value of Transactions, the Procedure and

Manner of Maintaining and Time for Furnishing Information and Verification and

Maintenance of Records of the Identity of the Clients of the Banking Companies, Financial

Institutions and Intermediaries) Rules, 2005 as amended and modified from time to time, the

guidelines/circulars issued by SEBI thereto, as amended from time to time, are hereinafter

collectively referred to as ‘PML Laws’.

The Client(s) should ensure that the amount invested through the services offered by the

Portfolio Manager is through legitimate sources only and does not involve and is not

designated for the purpose of any contravention or evasion of the provisions of the Income

Tax Act, 1961, PML Laws, Prevention of Corruption Act, 1988 and/or any other applicable law

in force and also any laws enacted by the Government of India from time to time or any rules,

regulations, notifications or directions issued there under.

To ensure appropriate identification of the Client(s) under its KYC policy and with a view to

monitor transactions in order to prevent money laundering, the Portfolio Manager (itself or

through its nominated agency as permissible under applicable laws) reserves the right to

seek information, record investor’s telephonic calls and/or obtain and retain documentation

for establishing the identity of the investor, proof of residence, source of funds, etc. It may

re-verify identity and obtain any incomplete or additional information for this purpose,

including through the use of third party databases, personal visits, or any other means as

may be required for the Portfolio Manager to satisfy themselves of the investor(s) identity,

address and other personal information.

The Client(s) and their attorney(ies), if any, shall produce reliable, independent source

documents such as photographs, certified copies of ration card/passport/driving license/PAN

card, etc. and/or such other documents or produce such information as may be required

from time to time for verification of the personal details of the Client(s) including inter alia

identity, residential address(es), occupation and financial information by the Portfolio

Manager. The Portfolio Manager shall also, after application of appropriate due diligence

measures, have absolute discretion to report any transactions to FIU-IND (and any other

23

competent authorities and self-regulating bodies), that it believes are suspicious in nature

within the purview of the PML Laws and/or on account of deficiencies in the documentation

provided by the Client(s) and the Portfolio Manager shall have no obligation to advise

investors or distributors of such reporting. The KYC documentation requirements shall also

be complied with by the persons becoming the Client by virtue of operation of law e.g.

transmission, etc.

The Portfolio Manager may not seek fresh KYC from the Clients who are already KRA

compliant and the ones who are not KRA compliant, the information will be procured by the

Portfolio Manager and uploaded.

The Portfolio Manager, and its promoters, directors, employees, agents and service providers

shall not be liable in any manner for any claims arising whatsoever on account of freezing the

client account/rejection of any application or mandatory repayment/returning of funds due

to non-compliance with the provisions of the PML Laws and KYC policy and/or where the

Portfolio Manager believes that transaction is suspicious in nature within the purview of the

PML Laws and/or for reporting the same to FIU-IND.

Client Information

The Portfolio Manager shall presume that the identity of the Client and the information

disclosed by the Client is true and correct. It will also be presumed that the funds invested

by the Client through the services of the Portfolio Manager come from legitimate sources /

manner and the investor is duly entitled to invest the said Funds. The Portfolio Manager may

stop all the trading activities for such Client/s and take such actions as may be required under

the Regulations and the Agreement, including closure of account.

Notwithstanding anything contained in this Disclosure Document, the provisions of the

Regulations, PML Laws and the guidelines there under shall be applicable. Clients are advised

to read the Disclosure Document carefully before entering into an agreement with the

Portfolio Manager.

Date:

Signature of Client:

For Decimal Wealth Partners Pvt Ltd

Names of Directors Signature

PLACE