Sundaram Mutual Fund Trustee Company Sundaram ......Address Sundaram Towers, II Floor, 46, Whites...

Sundaram Mutual Fundwww.sundarammutual.com

Mutual Fund Sundaram Mutual Fund

Trustee Company Sundaram Trustee Company Limited

Asset Management Company Sundaram Asset Management Company Limited

Address Sundaram Towers, II Floor, 46, Whites Road, Chennai - 600 014. India

SCHEME INFORMATION DOCUMENT

Toll Free: 1800 103 7237 (India) E-mail: [email protected]+91 44 4083 1500 (NRI) SMS SFUND to 56767 (NRI): [email protected]

The particulars of the Scheme have been prepared in accordance with the Securities and Exchange Board of India(Mutual Funds) Regulations 1996 as amended till date and filed with Securities and Exchange Board of India alongwith a Due Diligence Certificate from Sundaram Asset Management Limited. The units being offered for publicsubscription have not been approved or recommended by SEBI; SEBI has also not certified the accuracy oradequacy of the Scheme Information Document.

The Scheme Information Document sets forth concisely the information about the Scheme that a prospective investor oughtto know before investing. Investors should also ascertain about any further changes to this document after the date of thisDocument from the Mutual Fund/Investor Service Centres/Distributors/Brokers or visit www.sundarammutual.com.

Investors are advised to refer to the Statement of Additional Information (SAI) for details of Sundaram Mutual Fund,tax and legal issues and general information. The Statement of Additional Information is available atwww.sundarammutual.com and www.amfiindia.com

Statement of Additional Information is incorporated by reference and is legally a part of the Scheme InformationDocument. For a free copy of the current Statement of Additional Information, please contact your nearest InvestorService Centre or visit www.sundarammutual.com.

This Scheme Information Document is dated 30/06/2016.

Sundaram Banking & PSU Debt FundAn open-end Income scheme.

This product is suitable for investors who are seeking*

• Income over a short to medium term investment horizon• Investment in money market and debt securities issued by banks andpublic sectorentities/undertakings

*Investors should consult their financial advisers if in doubt about whetherthe product is suitable for them.

Riskometer

Moderate

LOW HIGH

ModeratelyHighMo

dera

tely

Low

Low

Hig

h

Investors understand that their principal will be at

Moderate Risk

Terms of offer: NAVNew Fund Offer opened 25-03-2015New Fund Offer closed 27-03-2015Scheme Re-Opened for Ongoing Subscription/Redemption 30-03-2015

Sundaram Mutual Fundwww.sundarammutual.com 2

Sundaram Banking & PSU Debt FundPart I

Sponsor

Trustee

Sundaram Finance LimitedRegistered Office: 21, Patullos Road, Chennai 600 002Indiawww.sundaramfinance.in

Sundaram Trustee Company LimitedCorporate Office: Sundaram Towers, II Floor, 46 Whites Road, Chennai 600 014 IndiaPhone : 044 28583362 Fax : 044 28583156

Investment Manager

Sundaram Asset Management Company LimitedCorporate Office: Sundaram Towers, II Floor, 46 Whites Road, Chennai 600 014 IndiaPhone : 044 28583362 Fax : 044 28583156www.sundarammutual.com

If you wish to reach indicated telephone number from outside India, please use +91 or 0091 followed by 44 and the eight number.

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SponsorThe Sponsor of Sundaram Mutual Fund is SundaramFinance Limited. Sundaram Finance owns a 100% stake inSundaram Asset Management Company Limited andSundaram Trustee Company Limited. A detailedbackground of the sponsor-Sundaram Finance Limited-isavailable in the Statement of Additional Information, whichcan be accessed at www.sundarammutual.com.Name of the SchemeSundaram Banking & PSU Debt Fund.Scheme Type (Fundamental Attribute)An open-end Income scheme..Offer PriceNAV.Investment Objective (Fundamental Attribute)The investment objective of the Scheme is to seek to generateincome and capital appreciation by primarily investing in aportfolio of debt and money market securities that are issuedby banks, public sector undertakings and Public FinancialInstitutions. There is no assurance that the investmentobjective of the Scheme will be realized.No Guarantee: Investors are neither being offered anyguaranteed/indicated returns nor any guarantee onrepayment of capital by the Schemes. There is also noguarantee of capital or return either by the mutual fund orby the sponsor or by the Asset management Company.

Indicative Asset Allocation (Fundamental Attribute)Scheme/Instrument % of the investible Risk

funds (indicative) profileMoney market and debt* securities issued by banks, public sector undertakings (PSUs) and Public Financial Institutions PFIs) 80-100 Low to MediumOther debt* and money market securities upto 20% Low to Medium* Including securitised Debt (domestic) up to 50% of the net assetsInvestments in derivatives will be upto 10% of the netassets of the Scheme.Public sector undertakings include those entities,• in which the Government of India / a State Government

has at least 51% shareholding.• notified / qualifies as public sector entities, in

accordance with norms / notified by Government ofIndia / a State Government .

• the debt of which is guaranteed by Government of India/ a State Government. Banks will include all scheduledcommercial banks which are regulated by ReserveBank of India.

The Scheme may invest in fixed income derivatives fortrading, hedging and portfolio rebalancing or any otherpurposes as may be permitted under regulatory guidelines.The type and extent of derivative exposure of the Schemewill be subject to applicable regulatory guidelines specifiedby SEBI / RBI / such other Regulatory Authority from time totime.The scheme will not invest in foreign securities. Thescheme shall not engage in securities lending/Borrowing

and short selling. The scheme shall not invest inrepo/reverse repo in corporate bond or in Credit DefaultSwaps.The cumulative gross exposure to debt, money marketinstruments and derivatives shall not exceed 100% of thenet assets of the scheme, subject to SEBI circular No. Cir/IMD/ DF/ 11/ 2010 dated August 18, 2010. The same-security-wise hedge positions would be excluded fromcomputing the percentage.Pending deployment in terms of the investment objective,funds may be invested in short-term deposits withscheduled commercial banks in accordance withapplicable SEBI guidelines. The Scheme shall not invest inrepo in Corporate Bond.Exposure to derivatives will be limited to 50% of the netasset value of the Scheme at the time of transaction.In accordance with SEBI Circular No. Cir/ IMD/ DF/ 11/2010 dated August 18, 2010, the cumulative grossexposure in debt securities and fixed income derivativesshall not exceed 100% of the net assets. Same securitywise hedge position have not been considered incomputing gross exposure.Changes in Investment Pattern: Subject to SEBIRegulations, the asset allocation pattern indicated abovemay change from time to time, keeping in view the marketconditions, market opportunities, applicable Regulationsand political & economic factors.It must be clearly understood that the percentage statedabove are only indicative and not absolute. Theseproportions can vary substantially depending upon theperception of the Investment Manager; the intention beingat all times to seek to protect the interests of Unit Holders.Such changes in investment pattern will be for a short-termand for defensive consideration only.

Liquidity (Fundamental Attribute)Purchase / Switch In: On any business day, at NAV.Redemption / Switch Out: On any business day at NAV,

subject to exit load, if any. The redemption proceeds shall be dispatched to the unitholders within 10 business days from the date ofredemption.Transaction Facility through Stock ExchangeA Unitholder may subscribe (One–time & Systematicinvestments) and redeem units of the eligible Plan(s) andOption(s) under the Scheme through the StockExchange(s) infrastructure of NSE MFSS and BSE Starplatform. Please refer the segment on International SecurityIdentification Number (ISIN) for the eligible Plan(s) andOption(s) available for transactions.BenchmarkCRISIL Short Term Bond Fund IndexFor more details, please refer the segment on Benchmark. Fund ManagersSiddharth Chaudhary and Sandeep AgarwalThe Trustee reserves the right to change the fundmanagers of the scheme.

Investment StrategyThe investment objective of the Scheme is to seek to


Sundaram Banking & PSU Debt FundHighlights & Scheme Summary

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generate income and capital appreciation by primarilyinvesting in a portfolio of debt and money market securitiesthat are issued by banks, public sector undertakings andPublic Financial Institutions.Investments in securities issued by Scheduled CommercialBanks, PSUs and PFIs shall be primarily made with theintention of ensuring safety in terms of timely repayment ofinterest and maturity proceeds.Further, higher liquidity of securities issued by ScheduledCommercial Banks, PSUs and PFIs would help mitigateliquidity risk.Fixed Income research by the Investment Manager willemphasize credit analysis, in order to determine credit risk.Credit analysis will focus on the issuer's historical andcurrent financial condition, current and anticipated cashflow and borrowing requirements, value of assets in relationto historical cost, strength of management, responsivenessto business conditions, credit standing, future businessprospects as well as current and anticipated operatingresults, among other things. The Investment Manager willalso analyse various economic trends in seeking todetermine the likely future course of interest rates. The fund will follow an active investment strategy within theoverall mandate, depending on opportunities available atvarious points in time.The Investment Manager will invest in those debt securitiesthat are rated investment grade by a domestic credit ratingagency authorised to carry out such activity, such asCRISIL, ICRA, CARE, India Ratings, etc. Investment inunrated debt securities shall also be made in accordancewith the limits and guidelines prescribed under the SEBI(Mutual Funds) Regulations, 1996. The actual percentage of investment in various MoneyMarket Instruments and other fixed income Securities willbe decided after considering the economic environmentincluding interest rates and inflation, the performance ofthe corporate sector and general liquidity and otherconsiderations in the economy and markets.Risk FactorsPotential investors should rely solely on the informationcontained in this Scheme Information Document. Theyshould read the risk factors presented in this documentthough the list is no way exhaustive. The Trustee acceptsno responsibility for any unauthorised information.Summary of Indicative Scheme-Specific RisksChanges in the prevailing rates of interest are likely to affectthe value of the Scheme's holdings and consequently thevalue of the Scheme's Units. The Scheme may usederivative instruments such as Interest Rate Swaps,Forward Rate Agreements or other derivative instrumentsfor the purpose of hedging and portfolio balancing andtrading, as permitted under the Regulations and guidelines.Usage of derivatives will expose the Scheme to certainrisks inherent to such derivatives. There is risk of capitalloss.Dividend PolicyThe Trustee Company reserves the right to distributedividend subject to availability of distributable surplus. Anydividend distribution and frequency of dividend distributionwill be entirely at the discretion of the trustee.The AMC Shall issue notice to the public, communicating

the decision about the dividend including the record datein one English daily newspaper having nation-widecirculation as well as in a newspaper published in thelanguage of the region where the Head Office of the MutualFund is situated. However, the requirement of giving notice shall not beapplicable for Dividend Options having frequency up toone month.Transparency: NAV & Portfolio DisclosureNAV will be determined and published on every businessday, except in special circumstances as mentioned underthe section titled as Net Asset Value, in Part III. TheInvestment Manager will send the NAV Information forpublication in two daily newspapers having circulation allover India and update on Investment Manager’s website(www.sundarammutual.com). The Investment Managershall also update the NAVs on the website of Association ofMutual Funds in India – AMFI www.amfiindia.com) before9.00 p.m. every business day. In case of any delay, thereasons for such delay would be explained to AMFI by thenext day. If the NAVs are not available beforecommencement of working hours on the following day dueto any reason, the Fund shall issue a press releaseproviding reasons and explaining when the Fund would beable to publish the NAVs.Further transparency will be maintained through fact sheetson a monthly basis.Applicable NAVPursuant to SEBI Circulars SEBI/IMD/CIR No. 11/142521/08dated October 24, 2008 and CIR/IMD/DF/19/2010 datedNovember 26, 2010 read along with the circularCIR/IMD/DF/21/2012 dated September 13, 2012, theapplicable NAV shall be as follows:• For subscription/redemption/switch request received

before 3.00 pm on any business day, the closing NAV ofthe day of receipt of application.

• For subscription/redemption/switch request receivedafter 3.00 pm on any business day, the closing NAV ofnext business day after the receipt of application.

For allotment of units in respect of purchase of units /switch from other schemes for an amount of Rs. 2 lakhsand above:In respect of applications for purchase of units / switch fromother schemes of an amount equal to or more than Rs. 2lakhs, the closing Net Asset Value (NAV) of the BusinessDay on which the funds are available for utilization shall beapplicable provided that:(i) Application for purchase / switch-in is received before

the applicable cut-off time.(ii) Funds for the entire amount of subscription / purchase

/ switch-in as per the application are credited to thebank account of the scheme before the cut-off time.

(iii) The funds are available for utilization before the cut-offtime without availing any credit facility, whether intra-day or otherwise.

Where application is received after the cut-off time on a dayand the funds are available for utilization without availingany credit facility, whether intra-day or otherwise, on thesame day, the closing NAV of the next Business Day shall



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be applicable.Multiple applications / transactions by an investor shall beaggregated as per conditions mentioned below andclosing NAV of the day on which funds for respectiveapplication / transaction are available for utilization will beapplied where the aggregated amount of investment is forRs.2.00 lakhs and above:1. All transactions received on the same business day (as

per Time stamp rule).2. Transactions shall include purchases, additional

purchases and excludes Switches.3. Aggregation shall be done on the basis of

Investor/s/Unit Holder/s PAN. In case of joint holding,transactions with similar holding structures shall beaggregated.

4 All transactions will be aggregated where investorholding pattern is same as stated in point no. (3) above,irrespective of whether the amount of the individualtransaction is above or below Rs. 2 lakhs.

5. Only transactions in the same scheme shall beaggregated. This will also include transactions at Plan /option level (Regular Plan, Direct Plan, Dividend option,Growth option, etc.).

6. Transactions in the name of minor received throughguardian will not be aggregated with the transaction inthe name of same guardian.

The Investment Manager reserves the right to change ormodify any of the conditions related to aggregation oftransactions in line with directives issued by Securities andExchange Board of India or AMFI from time to time.For subscription, the applicable NAV will be as indicatedonly for local cheque or demand draft payable at par in theplace of receipt. If the application for subscription isaccompanied by an outstation cheque or demand draft notpayable at par in the place of receipt, closing NAV of theday on which the cheque or DD is credited will be theapplicable NAV.Switch-in shall be treated as subscription request. Switch-out shall be treated as redemption request.While subscribing to an option under Direct Plan whichdoes not have a NAV, units shall be allotted based on theNAV of corresponding option/ sub-option under the RegularPlan. In case of non-availability of NAV in the correspondingoption / sub-option (due to NIL investors under theoption/sub-option) in the Regular plan, the applicable NAVshall be that of the corresponding Growth Option under theRegular Plan.

Plans/OptionsPlans: Regular Plan and Direct PlanOptions: Growth, Dividend Payout (Weekly, Monthly,Quarterly), Dividend Reinvestment (Daily, Weekly, Monthly,Quarterly), Bonus (Quaterly, Half yearly, Annual) If investment option is not indicated the default option willbe Growth. Unless otherwise specified, if an investor chooses theDividend Option but fails to indicate a sub-option, thedefault sub-option shall be Dividend Re-Investment.The initial entrants to the Bonus Option shall be allotted

units at the applicable Net Asset Value (NAV) of the GrowthOption of the scheme. Subsequent investors shallsubscribe and / or redeem at the applicable NAV of theBonus option under the scheme.

Pursuant to SEBI circular CIR/IMD/DF/21/2012 datedSeptember 13, 2012, subscription, including new SIP andSTP registrations, in the Retail and Institutional Plan(including options under the plan) has been discontinuedwith effect from October 01, 2012. Also, from November01, 2012, the dividends declared (irrespective of theamount) under Dividend Reinvestment Option of thesediscontinued Plan(s)/Option(s) shall be reinvested into thecorresponding Option under the Single Plan of theScheme, i.e. Super Institutional Plan which is referred to asRegular Plan from October 01, 2012.

All plans and options available for offer under the schemeshall have a common portfolio

Direct Plan was introduced in the scheme with effect fromJanuary 01, 2013. It is only for investors who purchase/subscribe Units into the Scheme directly with the Fund andis not available for investors who route their investmentsthrough a Distributor.

All categories of investors (whether existing or newUnitholders) as permitted to invest in this scheme areeligible to subscribe under Direct Plan. Investments underDirect Plan can be made through various modes offeredby the Fund for investing directly with the Fund {exceptStock Exchange Platform(s) and all other Platform(s) whereinvestors’ applications for subscription of units are routedthrough Distributors}.

The expense ratio of Direct Plan shall be lower than that ofthe Regular Plan. No commission for distribution of Unitswill be paid / charged under Direct Plan. The direct planwill also have a separate NAV.

Investors wishing to subscribe under Direct Plan of aScheme will have to indicate “Direct Plan” against theScheme name in the application form.

In the following cases, the applications shall be processedunder the Direct Plan:1. Distributor code is mentioned in the application form, but

“Direct Plan” is indicated against the Scheme name2. Where application is received for Regular Plan without

Distributor code or the word "Direct" is mentioned in theARN column.

3. Neither the plan nor the distributor code is mentioned inthe application form

In the following cases, the applications shall be processedunder the Regular Plan:1. The application form contains the distributor code but

does not indicate the plan.2. Where application is received for Regular Plan with

Distributor code.

International Security Identification Number (ISIN)The Investor has an option to hold the units either in thephysical or demat mode in accordance with his/her ownchoice. International Security Identification Numbers (ISIN)in respect of the plans/options of the schemes have beencreated in National Securities Depository Limited (NSDL)and Central Depository Services Limited (CDSL).The



details of ISIN are as followsRegular Annual Bonus INF903J016I7Regular Daily Dividend Reinvestment INF903J010I0Regular Growth INF903J016H9Regular Half Yearly Bonus INF903J015I9Regular Monthly Dividend Payout INF903J018H5Regular Monthly Dividend Reinvestment INF903J012I6Regular Quarterly Bonus INF903J014I2Regular Quarterly Dividend Payout INF903J019H3Regular Quarterly Dividend Reinvestment INF903J013I4Regular Weekly Dividend Payout INF903J017H7Regular Weekly Dividend Reinvestment INF903J011I8Direct Annual Bonus INF903J017J3Direct Daily Dividend Reinvestment INF903J010J8Direct Growth INF903J017I5Direct Half Yearly Bonus INF903J016J5Direct Monthly Dividend Payout INF903J012J4Direct Monthly Dividend Reinvestment INF903J013J2Direct Quarterly Bonus INF903J015J7Direct Quarterly Dividend Payout INF903J019I1Direct Quarterly Dividend Reinvestment INF903J014J0Direct Weekly Dividend Payout INF903J018I3Direct Weekly Dividend Reinvestment INF903J011J6With effect from October 01, 2012, subscription underInstitutional Plan in respect of all the schemes covered inthis document has been discontinued. The ISINs as mentioned in the table above are alsoavailable for subscription and redemption in NSE MFSSand BSE Star platform except all the plans/options underDirect Plan and Daily / Weekly / Fortnightly dividend optionunder the Regular plan.In case the unitholder desires to hold the units inDematerialized / Rematerialized form at a later date, therequest for conversion of units held in non-DEMAT form intoDEMAT (electronic form) or vice-versa should be submittedalong with a DEMAT/REMAT request form to theirDepository Participants.MF Utility PlatformAll financial and non-financial transactions pertaining toSchemes of Sundaram Mutual Fund can be done throughMFU either electronically on www.mfuonline.com as andwhen such a facility is made available by MFUI orphysically through the authorized Points of Service (“POS”)of MFUI with effect from the respective dates as publishedon MFUI website against the POS locations. The list of POSof MFUI is published on the website of MFUI atwww.mfuindia.com as may be updated from time to time.The Online Transaction Portal of MFU i.e.www.mfuonline.com and the POS locations of MFUI will bein addition to the existing Official Points of Acceptance(“OPA”) of the AMC. The uniform cut-off time as prescribedby SEBI and as mentioned in the SID / KIM of respectiveschemes shall be applicable for applications received onthe portal of MFUI i.e. www.mfuonline.com. However,investors should note that transactions on the MFUI portalshall be subject to the eligibility of the investors, any terms& conditions as stipulated by MFUI / Mutual Fund / the AMCfrom time to time and any law for the time being in force.Load StructureEntry Load: Nil. In accordance with SEBI Regulation, therewill be no entry load for investments in the Scheme. Thisshall apply to new investment in the Scheme, additional

purchase, switch-in, systematic investment plan,systematic transfer plan, dividend re-invested, dividendsweep-in, bonus units and any other form of investment thatmay be introduced as a facility. The upfront commission todistributor (ARN holder) will be paid by the investor directlyto the distributor, based on his assessment of variousfactors including the service rendered by the distributor.The distributor (ARN holder) will disclose all thecommissions (in the form of trail commission or any othermode) payable to them for the different competing Schemeof various mutual funds from amongst which the Scheme isbeing recommended to the investor.Exit Load: Nil.Load structure is indicated as a percentage of NAV.In accordance with SEBI Regulation, of the exit load /contingent deferred sales charge that is charged to theinvestor, a maximum of 1% of the redemption proceedsshall be maintained in a separate account to paycommissions to the distributor and for meeting othermarketing and selling expenses. Any amount in excess of1% of the redemption value charged to the unit holder asexit load / contingent deferred sales charge shall becredited to the respective Scheme immediately.Pursuant to SEBI Circular CIR/IMD/DF/21/2012 datedSeptember 13, 2012 read with notification No. LAD-NRO/GN/2012-13/17/21502 dated September 26, 2012service tax on exit load, if any, shall be paid out of the exitload proceeds and exit load net of service tax, if any, shallbe credited to the scheme with effect from October 01,2012. Investors are requested to note that exit load isinclusive of Service Tax at applicable rates as prescribedby Ministry of Finance from time to time.

Applicability(a) Bonus units and units issued on reinvestment of

dividend shall not be subject to exit load.(b) Prescribed exit load will be applicable for switch out

and every instalment under a Systematic Transfer Planand Systematic Withdrawal Plan. The period indicatedfor exit load shall be reckoned from the date ofallotment.

(c) Switch of existing investments from Regular Plan toDirect Plan where the transaction has been receivedwithout broker code in the Regular Plan shall not besubject to exit load.However, any subsequent switch / redemption of suchinvestment shall be subject to exit load based on theoriginal date of investment in the Regular Plan and notfrom the date of switch into Direct Plan. (effective fromApril 01, 2013)

(d) In case of switch of investments from Regular Plan toDirect Plan received with broker code in the RegularPlan, the exit load as applicable to redemption of unitsunder the respective scheme(s) shall apply.However, any subsequent switch-out or redemption ofsuch investment shall not be subject to exit load.(effective from April 01, 2013)

(e) In case of switch of investments from Direct Plan toRegular Plan, no exit load shall be levied. However,any subsequent switch-out or redemption of suchinvestment shall be subject to exit load based on theoriginal date of investment in the Direct Plan and not



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from the date of switch into Regular Plan. (effectivefrom April 01, 2013)

(f) Investors wishing to transfer their accumulated unitbalance held under discontinued plans and RegularPlan (through lumpsum / systematic investmentsmade with Distributor code) to Direct Plan can switchtheir investments (subject to applicable Exit Load, ifany) to Direct Plan. However, any subsequent switch-out or redemption of such investment shall not besubject to exit load. (effective from April 01, 2013)Investors wishing to transfer their accumulated unitbalance held under discontinued plans and RegularPlan (through lumpsum / systematic investmentsmade without Distributor code) to Direct Plan canswitch their investments, without Exit Load, to DirectPlan. However, any subsequent switch / redemptionof such investment shall be subject to exit load basedon the original date of investment in the Regular Plan/ Discontinued Plans and not from the date of switchinto Direct Plan. (effective from April 01, 2013)

Switches shall be subject to completion of lock-in period, ifany, under the respective scheme.The Board of Trustee reserves the right to prescribe ormodify the exit load structure with prospective effect,subject to SEBI Regulation.Details of the modifications will be communicated in thefollowing manner: • Addendum detailing the changes will be attached or

incorporated to the SID and Key InformationMemorandum. The addendum will become anintegral part of this Scheme information document.

• The change in exit load structure will be notified by asuitable display at the Corporate Office of theSundaram Asset Management and at the InvestorService Centres of the registrar.

• A public notice shall be given in one English dailynewspaper having nation-wide circulation as well asin a newspaper published in the language of regionwhere the Head Office of the Mutual Fund is situated.

The introduction/modification of exit load will be stampedon the acknowledgement slip issued to the investors onsubmission of an application form and will also bedisclosed in the account statement issued after theintroduction of such exit load.Investors are requested to ascertain the applicable exitload structure prior to investing.Transaction Charge to Distributors1 The Distributor would be allowed to charge the Mutual

Fund Investor a Transaction Charge where the amountof investment is Rs. 10,000/-and above on a persubscription basis

2 For an investor other than First Time Mutual FundInvestor, the Transaction Charge allowed will be Rs.100/- per subscription of Rs. 10,000/- and aboveFor a First Time Mutual Fund Investor, the TransactionCharge allowed will be Rs. 150/- per subscription of Rs.10,000/- and above

3 The Transaction Charge, where applicable based on theabove criteria, will be deducted by the InvestmentManager from the subscription amount remitted by theInvestor and paid to the distributor; and the balance(net) amount will be invested in the scheme. Thus units

will be allotted against the net investment.4 No Transaction charges shall be levied:

a) Where the distributor/agent of the investor has notopted to received any Transaction Charges;

b) Where the investor purchases the Units directly fromthe Mutual Fund;

c) Where total commitment in case of SIP / Purchases/ Subscriptions is for an amount less than Rs.10,000/-;

d) On transactions other than purchases / subscriptionsrelating to new inflows.Switches / Systematic Transfers / Allotment of BonusUnits / Dividend reinvestment Units / Transfer /Transmission of units, etc will not be considered assubscription for the purpose of levying thetransaction charge.

e) Purchases / subscriptions carried out through stockexchange(s).

The distributors can opt-in / opt-out of levying transactioncharges based on ‘type of the Product/Scheme’ instead of‘for all Schemes’. Accordingly, the transaction chargeswould be deducted from the subscription amounts, asapplicable.However, the distributor shall not be able to opt-in or opt-out at the investor-level i.e. a distributor shall not chargeone investor and choose not to charge another investor.The transaction charges are in addition to the existingsystem of commission permissible to the Distributors. Onsubscription through Distributors, the upfront commission ifany will be paid directly by the Investors to the Distributorby a separate cheque based on their assessment ofvarious factors including the service rendered by theDistributor.Any circular/clarification issued by SEBI/AMFI in this regardwill automatically become applicable and will beincorporated in the SID/SAI/KIM wherever applicable.Initial Issue ExpensesNot applicable as this document covers an existingScheme.Annual Fee & Recurring Expenses (FundamentalAttribute)The total annual recurring expenses of the Scheme,excluding deferred revenue expenditure written off, issue orredemption expenses, but including the investmentmanagement/advisory fee that can be charged to thescheme shall be within the limits specified in Regulation 52of SEBI (Mutual Funds) Regulations.Details are available in Part IV of the Scheme InformationDocument. The Investment Management Fees and otherrecurring expenses will be calculated on the basis of dailynet assets.Repatriation basisNRIs, registered FIIs and registered sub account of FIIsmay invest in the Scheme only on full repatriation basis,subject to necessary RBI approvals, if any.Minimum Investment Amount Applicable to both Regular & Direct Plan: For firstinvestment - Rs 5,000 and multiples of Rs. 1 thereafter andfor additional purchase - Rs. 500 & multiples of Rs 1thereafter.



• SIP (Weekly-every Wednesday) Rs 1000 • SIP (Monthly):Rs 250 • SIP (Quarterly): Rs 750. The thresholds shall alsoapply for SIP through a Systematic Transfer Plan. Theweekly SIP & STP requests shall be processed onWednesday of every week. If Wednesday is not a businessday, the SIP/STP installment will be processed on the nextbusiness day.Pursuant to SEBI circular CIR/IMD/DF/21/2012 datedSeptember 13, 2012, the instalments of SIPs registeredunder the discontinued Plan(s)/Option(s) shall beprocessed in the corresponding option under Single Plan ofthe Scheme, i.e. Regular Plan (erstwhile Retail Plan) witheffect from November 01, 2012. Instalments of SIPs registered with the broker code underRegular Plan and discontinued plan(s) on or beforeDecember 31, 2012 shall continue to be processed underRegular Plan.Instalments of SIPs registered without the broker codeunder Regular Plan and discontinued plan(s) on or beforeDecember 31, 2012 shall be processed in thecorresponding option under Direct Plan from January 01,2013.Investors who had registered for SIP facility with distributorcode on or before December 31, 2012 and wish to continueto the SIP instalments under the Direct Plan shall make awritten request to Sundaram Mutual Fund in this behalf. Thefund will take at least 21 working days to process suchrequests. Intervening instalments shall continue to beprocessed under the Regular Plan.

Minimum Redemption Limit The minimum amount for redemption/switch out will be: Regular Plan / Direct Plan: 50 units or Rs. 500 or accountbalance, whichever is lowerMinimum amount for STP • (Weekly-every Wednesday) Rs1000 • (Monthly): Rs 250 • (Quarterly): Rs 750 and anyamount thereafter. If Wednesday is not a business day, theSTP installment will be processed on the next business day.Pursuant to SEBI circular CIR/IMD/DF/21/2012 datedSeptember 13, 2012, the instalments of STPs registered forsystematic transfer from a scheme to any other scheme ofSundaram Mutual under Regular Plan and discontinuedPlan(s) (wherever available earlier for subscription under ascheme) shall be processed under the Single Plan in thecorresponding option of the respective target scheme witheffect from November 01, 2012Instalments of STPs registered with the broker code underRegular Plan on or before December 31, 2012 shall beprocessed under Single Plan in the corresponding option ofthe respective target scheme.Instalments of STPs registered without the broker codeunder Regular Plan on or before December 31, 2012 shallbe processed under Direct Plan in the correspondingoption of the respective target scheme from January 01,2013.Investors who had registered for STP facility with distributorcode on or before December 31, 2012 and wish to continueto the STP instalments under the Direct Plan shall make awritten request to Sundaram Mutual Fund in this behalf. Thefund will take at least 21 working days to process suchrequests. Intervening instalments shall continue to be

processed under the Single Plan of the respective targetscheme.Switch-out from a scheme to another scheme of SundaramMutual Fund & Redemption shall be allowed at NAV basedprices, subject to Exit Load if any. If the Specified Date is aNon Business Day the application will be processed on thenext Business Day.Where units under a Scheme are held under discontinuedplans as well as Direct Plan and the redemption / Switchrequest pertains to the Direct Plan, the same must clearlybe mentioned on the request (along with the folio number).However, where Units under the requested Option are heldonly under one Plan, the request would be processedunder such Plan.Switch / redemption may entail tax consequences.Investors should consult their professional tax advisorbefore initiating such requests.Valuation of AssetsThe assets of the Scheme will be valued in conformity withSEBI Regulations / Guidelines as applicable from time totime. For more details regarding valuation policy, pleaserefer the Statement of Additional Information or the websiteof the Investment Manager www.sundarammutual.comIllustrative List of Tax ImplicationsThis summary of tax implications is based on the currentprovisions of the applicable tax laws. This information isprovided for general purpose only. In view of the individualnature of tax implications, investors are advised to refer theprovisions of the Income-Tax Act and/or consult theirinvestment/tax advisor with respect to the specific taximplications arising out of an investment in the Scheme.Unit holders should be aware that the relevant fiscal rulesand their interpretation might change. As is the case withany investment, there can be no guarantee that the taxposition or the proposed tax position prevailing at the timeof investment in the Scheme will endure indefinitely.• Income of Sundaram Mutual Fund: Exempt from tax asper Section 10(23D) of the Income Tax Act.

• Securities Transaction Tax: Not Applicable.• Tax deduction at source: Not applicable for personsresident in India; TDS applies to redemption proceedspayable to NRIs/FIIs.No tax will be deducted at source from income paid toany investor as also from redemption amounts paid toresident investors.

• Dividend received from the Schemes is not taxable inthe hands of the investors.

• Units of the scheme are an eligible mode of investmentin terms of the pattern of investment prescribed underthe Income Tax Act for the following entities: † Charitable Trusts† Scientific Research Associations† Institutions/Associations/Boards for regulating games/ sports

† Employee Welfare Trusts• Dividend Distribution: The scheme will pay DividendDistribution Tax at the rate of 25.00% to the Individual &HUFs and 30% on distribution made to others (cess &Surcharge will also apply) The amount of distributedincome shall be increased to such an amount as would,after reduction of the additional income tax (DDT) onsuch increased amount at the rate specified shall be



equal to the amount of income distributed by the mutualfund / Company.

• No wealth tax is payable on the units of the scheme.• Units will be treated as a long-term capital asset if heldas a capital asset for more than 36 months. If the unitsare held for less than or equal to 36 months, they will betreated as short-term capital asset.

• Long-term capital gains are taxable at 10% (surchargeand cess will be payable) without indexation of the costof acquisition or at 20% (surcharge and cess will bepayable) with indexation of the cost of acquisition whichever is less.

• Short-term capital gains are taxable at normal ratesapplicable to the investor as per the provisions of theIncome Tax Act.

• Capital loss resulting from sale of units would beavailable for setting off against other capital gains made.Losses on transfer of long-term capital assets wouldhowever be allowed to be set-off only against gains fromtransfer of long-term capital assets. The balance long-term capital loss shall be carried forward separately fora period of eight assessment years to be set off onlyagainst long-term capital gains.

• In addition to Income tax, surcharge (on income tax) andcess (on total tax) will apply. The surcharge at the rate of15% is levied in case of individual/HUF unit holderswhere their income exceeds Rs. 1 crores. In case ofDomestic corporate unit holders, surcharge @ 7% islevied where income exceeds Rs. 1 crores but less thanRs. 10 crores and @ 12% where income exceeds Rs. 10crores. For the company other than domestic company,surcharge @ 2% is levied where income exceeds Rs. 1crores but less than Rs. 10 crores and @ 5% whereincome exceeds Rs. 10 crores. Cess will be payable at3% of total tax.

Investors should also refer to the Statement of AdditionalInformation available at www.sundarammutual.com formore but not exhaustive detail.Information AccessInvestors may access NAV, performance charts, portfoliodetails, Scheme features, fact sheet, product note/guide,offer document, FAQs and any relevant Scheme-specificmaterial on www.sundarammutual.com.Investor Relations ManagerRavi SHead- Customer Services Sundaram Asset Management Company LimitedSundaram Towers, No. 46, Whites Road, Royapettah, Chennai- 600 014. Fax: (044) 28569808 Toll Free 1800 103 7237 (India) +44 4083 1500 (NRI) Email us at : [email protected] (NRI): [email protected]

HDFC Bank, Mumbai registered with SEBI, videRegistration No IN/CUS/001, has been appointedcustodian for the securities in the Scheme. The responsibilities of the custodian include:• to keep in safe custody all the securities and instrumentsbelonging to the Scheme;

• to ensure smooth inflow/outflow of securities and

instruments as and when necessary in the best interestof the investors;

• to ensure that the benefits due on the holdings arereceived and

• to be responsible for the loss or damage to the securitiesdue to negligence on its part or on the part of itsapproved agents.

The Trustee reserves the right to appoint any othercustodian(s) approved by SEBI.Fund Accountant: Fund Accounting has been operationally outsourced to

Sundaram BNP Paribas Funds Services Limited Registrar and Transfer Agents SEBI Registration No. INR 000004066Unit: Sundaram Mutual Fund,Central Processing Center, 23, Cathedral Garden Road, Nungambakkam, Chennal-600034. Tel: 044 - 2830 9100

The activities inter-alia include:i. Record accounting entries to the fund.ii. Reconcile account balances for the fund.iii. Establish policies and procedures to assure proper

fund accounting.iv. Maintain proper documentation. v. Update computer system records. vi. Perform fund valuations of unit trusts and custodian

accounts. vii. Prepare schedules and tailor-made client reports. viii. Coordinate preparation of annual accounts and audit

unit trusts and custodian accounts. However, the Fund administration part would continue tobe handled by the Operations Department of theInvestment Manager.RegistrarSundaram BNP Paribas Fund Services Limited, Registrar and Transfer Agents, SEBI Registration No. INR 000004066Unit: Sundaram Mutual Fund,Central Processing Center, 23, Cathedral Garden Road, Nungambakkam, Chennal-600034. Tel: 044 - 2830 9100The Trustee reserves the right to appoint any other entityregistered with SEBI as the registrar.Information to Unit HoldersOn acceptance of a valid application for subscription, unitswill be allotted and a confirmation specifying the number ofunits allotted by way of email and/or SMS within 5 BusinessDays from the date of receipt of transaction request will besent to the Unit holder's registered e-mail address and/ormobile number. Subject to SEBI Regulations, Statement ofAccounts will be sent to those unitholders whose registeredemail address / mobile number is not available with theMutual Fund, unless otherwise required. Money would berefunded in respect of applications rejected, within fivebusiness days from the closure of the NFO period. TheScheme shall be available for trading within five businessdays of allotment.Consolidated Account Statement:



1) A consolidated account statement (CAS)^ for eachcalendar month to the Unit holder(s) in whose folio(s)transaction**(s) has/have taken place during themonth shall be sent on or before 10th of thesucceeding month by mail/e-mail. ^Consolidated Account Statement (CAS) shallcontain details relating to all the transactions** carriedout by the investor across all schemes of all mutualfunds during the month and holding at the end of themonth including transaction charges paid to thedistributor, if any. **The word ‘transaction’ shall include purchase,redemption, switch, dividend payout, dividendreinvestment, systematic investment plan, systematicwithdrawal plan, systematic transfer plan and bonustransactions.

2) In case of a specific request received from the Unitholders, the AMC/Mutual Fund will provide theaccount statement to the investors within 5 BusinessDays from the receipt of such request.

3) In case the mutual fund folio has more than oneregistered holder, the first named Unit holder shallreceive the CAS/account statement.

4) For the purpose of sending CAS, common investorsacross mutual funds shall be identified by theirPermanent Account Number (PAN).

5) The CAS shall not be received by the Unit holders forthe folio(s) not updated with PAN details. The Unitholders are therefore requested to ensure that thefolio(s) are updated with their PAN.

6) Further, the CAS detailing holding across all schemesof all mutual funds at the end of every six months (i.e.September/ March), shall be sent by mail/e-mail on orbefore 10th day of succeeding month, to all such Unitholders in whose folios no transaction has taken placeduring that period. The half yearly CAS will be sent bye-mail to the Unit holders whose e-mail address isavailable, unless a specific request is made to receivein physical. Such Consolidated Account Statementshall reflect the latest closing balance and value of theUnits prior to the date of generation of the accountstatement.

7) The statement of holding of the beneficiary accountholder for units held in DEMAT will be sent by therespective DPs periodically.

8) Pursuant to SEBI circular CIR/MRD/DP/31/2014 datedNovember 12, 2014, investors having Mutual Fundinvestments and holding securities in Demat accountshall receive a single Consolidated AccountStatement (CAS) from the Depository. Consolidationof account statement shall be done on the basis ofPermanent Account Number (PAN). In case ofmultiple holding, it shall be PAN of the first holder andpattern of holding. The CAS shall be generated on amonthly basis. If there is any transaction in any of theDemat accounts of the investor or in any of his mutual

fund folios, depositories shall send the CAS within tendays from the month end. In case, there is notransaction in any of the mutual fund folios and demataccounts then CAS with holding details shall be sentto the investor on half yearly basis.

Any circular/clarification issued by SEBI in this regard willautomatically become applicable and shall beincorporated in the SID/SAI/KIM wherever applicable. The Investment Manager shall publish the portfolio of thescheme as of March 31 and September 30 of every yearbefore the expiry of one month from the close of each halfyear. The portfolio shall be published in the SEBI-prescribed format in one national English daily newspaperand in a newspaper in the language of the region wherethe Head Office of the Mutual Fund is situated. TheInvestment Manager shall disclose the portfolio (along withISIN) as on the last day of the month for all the schemes inits website www.sundarammutual.com on or before thetenth day of the succeeding month in a user-friendly anddownloadable format, preferably a spreadsheet. Sundaram Mutual fund shall make half yearly disclosures ofunaudited financial results on its websitewww.sundarammutual.com in the prescribed format withinone month from the close of each half year, i.e. on 31stMarch and on 30th September. The half- yearly unauditedfinancial results shall contain details as specified in TwelfthSchedule and such other details as are necessary for thepurpose of providing a true and fair view of the operationsof the mutual fund. In addition, Sundaram Mutual Fund shallpublish an advertisement disclosing the hosting of suchfinancial results in its website, in atleast one English dailynewspaper having nationwide circulation and in anewspaper having wide circulation published in thelanguage of the region where the Head Office of Sundarammutual fund is situated.An abridged Scheme-wise annual report shall be only e-mailed to all unit holders, whose e-mail address is availablewith the Fund, within four months from the date of closureof the relevant accounting year; unit holders who have notprovided an email address/who have requested for aphysical copy shall receive a copy by post. The link ofScheme-wise annual reports or abridged summary thereofwill also be prominently displayed atwww.sundarammutual.com

Table of ContentsSummary of comparable schemes 11Part I Risk Factors 13Definitions 17Abbreviations & Interpretation / Due Diligence 18Part II Information about the Scheme 19Part III Units & Offer 34Part IV Fees, Expenses, Load Structure 52/53Part V Rights of Unit Holders 54Part VI Penalties & Pending Litigation 54Customer Care Centres 55



Differentiating aspect of Sundaram Banking & PSU Debt Fund: Sundaram Banking & PSU Debt Fund seeks togenerate income by primarily investing in a portfolio of debt and money market securities that are issued by banks,public sector undertakings and Public Financial Institutions. This is the only Scheme in Sundaram Mutual Fund, whichintends to invest predominantly in Debt and Money Market instruments issued by Banks, PSUs and PFIs.



Key Product Differentiation with existing comparable Schemes of Sundaram Mutual Fund

Scheme InvestmentObjective

Asset Allocation Risk Profile Investment StrategyProduct

Suitability forinvestors

BenchmarkTotal number offolios (as on Aug

31, 2014)

AUM Rs in Cr.(as on Aug 31,

2014)Differentiating aspects

SundaramBanking andPSU DebtFund

The investmentobjective of theScheme is to seekto generate incomeand capitalappreciation byprimarily investingin a portfolio of debtand money marketsecurities that areissued by banks,public sectorundertakings andPublic FinancialInstitutions

• Money market anddebt* securities issuedby banks, PublicSector Undertakings(PSUs) and PublicFinancial Institutions(PFIs)s: 80% 100%

• Other debt* and moneymarket securities: 0%20%*Including securitisedDebt up to 50% of thenet assets

Medium The scheme will invest predominantly insecurities issued by ScheduledCommercial Bank, Public SectorUndertakings and Public FinancialInstitutions.Investments in securities issued byScheduled Commercial Banks, PSUsand PFIs shall be primarily made withthe intention of ensuring safety in termsof timely repayment of interest andmaturity proceeds.Further, higher liquidity of securitiesissued by Scheduled CommercialBanks, PSUs and PFIs would helpmitigate liquidity risk.

This scheme issuitable forinvestors with ashort to mediumterm investmenthorizon

C R I S I LShort TermBond FundIndex.

NA NA Sundaram Banking & PSUDebt Fund seeks to generateincome by primarily investing ina portfolio of debt and moneymarket securities that areissued by banks, public sectorundertakings and PublicFinancial Institutions. This is the only Scheme inSundaram Mutual Fund havingthe mandate to investpredominantly in Debt andMoney Market instrumentsissued by Banks, PSUs andPFIs.

SundaramBond Saver

The investmentobjective of thisScheme would beto earn regularincome byinvesting primarilyin fixed incomesecurities, whichmay be paid asdividend orreinvested at theoption of theinvestor.

• Debt instruments: 65%-100%

Medium The Scheme being debt oriented, shallinvest a substantial portion rangingbetween 65%-100% of the investiblefunds in debt instruments, for whichthere is no regular and establishedmarket. While lack of liquidity in theIndian debt markets remains a matter ofconcern, the fund shall try to tackle thisby earmarking a certain portion of theinvestible funds for investment ingovernment securities and liquid, toprated corporate / PSU debt. Apart fromthis, a portion of the fund shall beinvested in extremely liquid moneymarket investments

The scheme issuitable forinvestors whohave ani n v e s t m e n thorizon ofmedium to longterm.

CRISILCompositeBond FundIndex

7240 202.61 Sundaram Bond Saver seeks toinvest in a portfolio, which hasa medium-to-long orientation interms of maturity and couldalso typically have higherduration to capitalise on theeffect of interest rate changeson bond prices.

SundaramIncome Plus

The primaryobjective of thescheme is to obtainhigh yields byinvesting in fixedincome securities.C a p i t a lappreciation is thes e c o n d a r yobjective

• High yield securitiesincluding securitizeddebt up to 100%

• C o n v e r t i b l eDebentures / Bondsand Preference sharesup to 15%

• High InvestmentGrade Fixed IncomeSecurities up to 100%

• Central GovernmentSecurities up to 50%

• Money MarketI n v e s t m e n t s(excluding call money)up to 50%

Medium The investments of the scheme will fall inthe rating categories such as AA (Highsafety), A (Adequate safety) and BBB(Moderate Safety) or equivalent short-term ratings.

The scheme issuitable forinvestors whoseeks higheryield than anormal bondfund return, whilewilling to takehigher risk.


274 1.47 Sundaram Income Plus seeksto invest in a portfolio thatwould have a judicious mix ofshort-maturity andmedium/long term maturity andbe managed in a dynamicmanner. The scheme will havesubstantially higher riskcompared to a schemeinvesting predominantly insovereign or AAA rated debtinstruments.

SundaramFlexible Fund– FlexibleIncome Plan

To generatereasonable returnsby creating ap o r t f o l i oc o m p r i s i n gsubstantially offixed incomeinstruments andmoney marketinstruments bykeeping the interestrate risk of the fundlow

• Fixed IncomeI n s t r u m e n t sGovernment of Indiaand Corporate debtsecurities (IncludingSecuritized Debt) 65-100%

• Money MarketInstruments (CDs,CPs, CBLO, REPO,MIBOR Instruments,debt Securities withinitial maturity of lessthan one year / GOISecs. / Treasury Bills):0%-35%

Medium Based on the interest rate view, theoptimum duration of the portfolio is firstdetermined. Then depending on thisdecision, the mix of G-Secs, corporatedebt, money market instruments, andcash is arrived at. This mix seeks toprovide maximum returns while stillprotecting the liquidity of the portfolio

Flexible Planwould generallybe invested ininstruments withLonger residualmaturities and issuitable forinvestors withLong - termi n v e s t m e n thorizon


451 310.44 Sundaram Flexible Fund –Flexible Income Plan seeks toinvest at the long end of thefixed-income market. Theaverage residual maturity of thesecurities in the portfolio isexpected to be more than oneyear and generally less thanten years with relatively higherexposure to credit, interest rateand liquidity risks, in view ofconcentration on Long terminstruments.



Key Product Differentiation with existing comparable Schemes of Sundaram Mutual Fund

Scheme InvestmentObjective

Asset Allocation Risk Profile Investment StrategyProduct

Suitability forinvestors

BenchmarkTotal number offolios (as on Aug

31, 2014)

AUM Rs in Cr.(as on Aug 31,

2014)Differentiating aspects

SundaramSelect DebtShort TermAsset Plan

The Fund seeks toearn regularincome byinvesting primarilyin fixed incomesecurities, whichmay be paid asdividend or re-invested at theoption of theinvestor.

• investment in debtinstruments(including securitizeddebt) 65-100%

• Money marketInstruments 0-35%

Medium The fund seeks to invest in fixedincome securities with a higher degreeof mark-to-market component andlengthier maturity profile as comparesto Sundaram Flexible Fund - Short TermPlan.

Investors whohave a horizon ofminimum 6months andappetite forintermittentvolatility can lookat this fund.

CRISILLiquidFundIndex

3687 718.74 Sundaram Select Debt ShortTerm Asset Plan seeks toinvest in fixed-incomesecurities with a higherdegree of mark-to-markedcomponent and lengthiermaturity profile as comparedto Sundaram Flexible Fund -Short Term Plan. The schemeshall be low on accrualstrategy and high on durationstrategy with the targetduration limited to 2.5 years.

SundaramFlexible FundShort-TermPlan

To generatereasonable returnsby creating aportfoliocomprisingsubstantially offixed incomeinstruments andmoney marketinstruments bykeeping theinterest rate risk ofthe fund low

• Money MarketInstruments (CDs,CPs, CBLO, REPO,MIBOR Instruments,Debt Securities withinitial maturity of lessthan one year/GOISecs. / TreasuryBills): 65%-100%

• Fixed IncomeI n s t r u m e n t s ,Government of Indiaand Corporate debtsecurities (IncludingSecuritized Debt): 0-35%

Low The Scheme's portfolio may cover awider spectrum of issuers as straddlesa wider range on the credit ratingspectrum to generate a pickup in yieldand seek returns that are higher thanwhat a normal Liquid fund offers. Thesecurities will be carefully chosen toadhere to the objective.

Short Term Planwould generallybe invested ininstruments withshorter residualmaturities and issuitable forinvestors withshort-terminvestmenthorizon

CRISILShortTerm BondFundIndex

2164 1973.96 Sundaram Flexible FundShort-Term Plan seeks toinvest at the short end of thefixed-income market. Theaverage maturity of theportfolio shall range from oneto two years with relativelyminimal exposure to credit,interest rate and liquidity risksin view of concentration onshort term instruments.

SundaramMoney Fund

The main objectiveis to provide a levelof incomeconsistent with thepreservation ofcapital, liquidityand lower level ofrisk, throughinvestments madeprimarily in moneymarket and debtsecurities. The aimis to optimizereturns whileproviding liquidity.

Money MarketInstruments and debtsecurities: 0-100%

Low The scheme will invest in debt andmoney market instruments in short termmaturities.

The scheme issuitable forInstitutional andHigh Net worthIndividuals and itserves a proxyfor savings andcurrent Accountinvestments.


4212 4724.93 Sundaram Money Fund is aliquid scheme investingpredominantly in MoneyMarket Instruments withminimal exposure to credit,interest rate and liquidity risks

SundaramUltra ShortTerm Fund

To provide a levelof incomeconsistent withliquidity throughinvestments madeprimarily in moneymarket and debtsecurities.

• Money marketsecurities and/ ordebt securities withresidual or averagematurity of less thanor equal to 370 daysor put options within aperiod not exceeding370 days 70% - 100%

• Debt securities whichhave residual oraverage maturity ofmore than 370 days0% - 30% (IncludingSecuritized Debt upto 30%)

Low The scheme will primarily invest in shortterm fixed income securities.

The scheme ismainly suitablefor Institutionaland High NetworthIndividuals, whowant to haveliquidity andbetter yield whencompared to themoney fund.


1959 1419.32 Sundaram Ultra Short TermFund seeks to invest mostly atthe short end of the fixed-income market. The fund mayhave a modest marked-to-market component in line withwhat is permitted by the AssetAllocation Pattern.

SundaramGilt Fund

The Fund seeks togenerate regularincome throughdedicatedinvestments in giltsconsistent withpreservation ofcapital.

• Government of IndiaDated Securities 0%-100%

• State GovernmentsDated Securities 0%-100%

• Government of IndiaTreasury Bills 0%-100%

Low The fund being a 100% gilt fund, wouldinvest exclusively in Governmentsecurities. Government securities aresafe investments any investor couldbuy in this country. Hence the fundshall invest in Central Govt. securities,State Govt. securities and the bondsunconditionally guaranteed by CentralGovt. Gilts are the most liquid fixedincome securities.

The scheme issuitable for retailinvestors who isrisk averse andwants to haveregular incomeand seekscapitalprotection.

I-SecMBEX

1195 31.77 Sundaram Gilt Fund invests ingovernment securities acrossmaturities. The degree ofmarket risk is higher as G-Secs are impacted in a morepronounced manner bychanges in interest rates

SOBNo.2

SOBNo.2 Standard Risk Factors:

• Investment in Mutual Fund Units involves investmentrisks such as trading volumes, settlement risk, liquidityrisk, default risk including the possible loss ofprincipal.

• As the price / value / interest rates of the securities inwhich the Scheme invests fluctuates, the value of yourinvestment in the Scheme may go up or down.

• Past performance of the Sponsor/InvestmentManager/Mutual Fund does not guarantee futureperformance of the Scheme.

• The names of each Scheme does not in any mannerindicate either the quality of the Scheme or its futureprospects and returns.

• The sponsor is not responsible or liable for any lossresulting from the operation of the Scheme beyond theinitial contribution of Rs 1 lakh made towards settingup the Fund.

• The Scheme is not a guaranteed or assured returnScheme.

Scheme-Specific Risks

Changes in the prevailing rates of interest are likely to affectthe value of the Scheme's holdings and consequently thevalue of the Scheme's Units. The Scheme may usederivative instruments such as Interest Rate Swaps,Forward Rate Agreements or other derivative instrumentsfor the purpose of hedging and portfolio balancing andtrading, as permitted under the Regulations and guidelines.Usage of derivatives will expose the Scheme to certainrisks inherent to such derivatives. There is risk of capitalloss.

General Risk Factors

• Mutual Funds and securities investments are subjectto market risks and there is no assurance or guaranteethat the objectives of the Scheme will be achieved.

• The main types of risks to which the Scheme isexposed are risk of capital loss, market risk, currencyrisk, liquidity risk, credit risk, counter party default risk,to name a few.

• As with any investment in securities, the NAV of theUnits issued under the Scheme can go up or downdepending on the factors and forces affecting thecapital markets.

• The NAV may be affected by factors such as marketconditions, level of interest rates, market-relatedfactors, trading volumes, settlement periods, transferprocedures, price/interest rate risk, credit risk,government policy, volatility and liquidity in markets,exchange rate, geo-political development, to name afew.

• Trading volumes in the securities in which the Schemeinvest may inherently restricts the liquidity of theScheme’s investments.

• Change in Government policy in general and changesin tax benefits applicable to mutual funds may impactthe returns to Investors in the Scheme.

• The tax benefits available under the Scheme is asavailable under the present taxation laws and subjectto relevant conditions. The information given isincluded for general purposes only and is based onadvice that the Investment Manager has receivedregarding the law and the practice that is now in forcein India.

• Unit holders should be aware that the relevant fiscalrules and their interpretation might change. As is thecase with any investment, there can be no guaranteethat the tax position or the proposed tax positionprevailing at the time of investment in the Scheme willendure indefinitely. In view of the individual nature oftax consequences, each Investor/Unit holder isadvised to consult his/her own professional taxadvisor.

• Investors/unit holders are also urged to read thedetailed clause(s) titled ‘Special considerations’.

• FATCA imposes tax withholding upto 30% on anypayments (including redemption and dividendproceeds) made by the Fund/AMC to a US Personclassified as recalcitrant account holder in respect ofwhom the applicable documentation and reportingrequirements are not met.

This is only an illustrative list and not an exhaustive listfactors that could affect the NAV of the Scheme. Theyshould read the risk factors presented in this documentthough the list is no way exhaustive. Potential investorsshould rely solely on the information contained in thisScheme Information Document and are advised to consulttheir investment advisors before taking investmentdecisions.

Risk of Capital Loss

The Net Asset Value (NAV) of the Scheme is exposed tomarket fluctuations, and its value can go up as well asdown. Investors may lose their entire principal.

Risk Factors - Debt Markets

• Interest Rate Risk: Changes in the prevailing rates ofinterest may affect the value of the Scheme’s holdingsand consequently the value of the Scheme’s Units.Increased rates of interest, which frequently accompanyinflation and /or a growing economy, may have anegative effect on the value of the Units. The value ofdebt securities held by the Scheme generally will varyinversely with the changes in prevailing interest rates. While it is the intent of the fund manager to investprimarily in high rated debt securities, the Scheme mayfrom time to time invest in higher yielding, low ratedsecurities. As a result, an investment in the Scheme maybe accompanied by a higher degree of risk relative toan investment consisting exclusively of high rated, lower


Sundaram Banking & PSU Debt FundPart I Risk Factors

yielding securities.• Credit Risk: Credit Risk refers to the risk of failure ofinterest (coupon) payment and /or principal repayment.All debt instruments carry this risk. Governmentsecurities carry sovereign credit risk. The assets of theScheme may be partly invested in fixed incomesecurities issued by a corporate entity, bank, financialinstitution and/or a public sector undertaking owned bythe Government of India or by a government in any state.The credit risk associated with the aforementionedissuers of debt is higher than that of governmentsecurities.

• Price Risk: As long as the Scheme remains invested, itsNet Asset Value (NAV) would be exposed to marketfluctuations, and its value can go up as well as down.The portfolio of fixed-income securities that the Schemeinvests in would be exposed to price changes on a day-to-day basis.

• These price changes may occur due to instrument-specific factors as well as general macroeconomicconditions. In general, price of fixed-income securitiesgo up when interest rates fall, and vice versa.

• Market Risk: The Scheme may also be subject to pricevolatility due to such factors as interest sensitivity, marketperception or the creditworthiness of the issuer andgeneral market liquidity.

• Liquidity Risk: A lower level of liquidity affecting anindividual security (ies) or an entire market may have anadverse bearing on the value of the Scheme’s assets.This may more importantly affect its ability to sellparticular securities with minimal impact cost as andwhen necessary to meet requirement of liquidity or to sellstocks in response to triggers such as a specificeconomic/corporate event. Trading volumes, settlementperiods and transfer procedures may restrict the liquidityof a few of the investments.

• Risk relating to investment pattern: Different types ofsecurities in which the Scheme would invest as given inthe Scheme Information Document carry different levelsand types of risk. Accordingly the Scheme's risk mayincrease or decrease depending upon its investmentpattern. e.g. corporate debt carry credit risk unlikeGovernment securities. Further even among corporatedebt, AAA rated debt is comparatively less risky (incredit risk terms) than those rated lower (say AA or A).

• Risks relating to duration: Fixed Income securities of anyissuer that has higher duration could be more risky interms of price movements relative to those with lowerduration. Thus any impact of interest rate changes wouldbe higher on securities with higher duration irrespectiveof the status of the issuer of the security.

• Limited Liquidity & Price Risk: Presently, secondarymarket for securitised papers is not very liquid. There isno assurance that a deep secondary market will developfor such securities. This could limit the ability of the

investor to resell them. Even if a secondary marketdevelops and sales were to take place, these secondarytransactions may be at a discount to the initial issueprice due to changes in the interest rate structure.

• Limited Recourse, Delinquency and Credit Risk:Securitised transactions are normally backed by a poolof receivables and credit enhancement as stipulated bythe rating agency, which differ from issue to issue. TheCredit Enhancement stipulated represents a limited losscover to the Investors. These Certificates represent anundivided beneficial interest in the underlyingreceivables and there is no obligation of either the Issueror the Seller or the originator, or the parent or any affiliateof the Seller, Issuer and Originator. No financial recourseis available to the Certificate Holders against theInvestors’ Representative. Delinquencies and creditlosses may cause depletion of the amount availableunder the Credit Enhancement and thereby the InvestorPayouts may get affected if the amount available in theCredit Enhancement facility is not enough to cover theshortfall. On persistent default of an Obligor to repay hisobligation, the servicer may repossess and sell theunderlying Asset. However many factors may affect,delay or prevent the repossession of such Asset or thelength of time required to realize the sale proceeds onsuch sales. In addition, the price at which such Assetmay be sold may be lower than the amount due from thatObligor.

• Risks due to possible prepayments: Weighted Tenor /Yield: Asset securitisation is a process wherebycommercial or consumer credits are packaged and soldin the form of financial instruments Full prepayment ofunderlying loan contract may arise under any of thefollowing circumstances;• Obligor pays the Receivable due from him at any timeprior to the scheduled maturity date of thatReceivable; or

• Receivable is required to be repurchased by theSeller consequent to its inability to rectify a materialmisrepresentation with respect to that Receivable; or

• The servicer recognizing a contract as a defaultedcontract and hence repossessing the underlyingAsset and selling the same.In the event of prepayments, investors may beexposed to changes in tenor and yield.

• Bankruptcy of the Originator or Seller: If originatorbecomes subject to bankruptcy proceedings and thecourt in the bankruptcy proceedings concludes that thesale from originator to Trust was not a sale then anInvestor could experience losses or delays in thepayments due. All possible care is generally taken instructuring the transaction so as to minimize the risk ofthe sale to Trust not being construed as a “True Sale”.Legal opinion is normally obtained to the effect that theassignment of Receivables to Trust in trust for and for the



benefit of the Investors, as envisaged herein, wouldconstitute a true sale.

• Bankruptcy of the Investor’s Agent: If the Investor’sagent, becomes subject to bankruptcy proceedings andthe court in the bankruptcy proceedings concludes thatthe recourse of Investor’s Agent to the assets /receivables is not in its capacity as agent / Trustee but inits personal capacity, then an Investor could experiencelosses or delays in the payments due under the swapagreement. All possible care is normally taken instructuring the transaction and drafting the underlyingdocuments so as to provide that the assets/receivablesif and when held by Investor’s Agent is held as agentand in Trust for the Investors and shall not form part ofthe personal assets of Investor’s Agent. Legal opinion isnormally obtained to the effect that the Investors Agent’srecourse to assets/ receivables is restricted in itscapacity as agent and trustee and not in its personalcapacity.

• Credit Rating of the Transaction / Certificate: The creditrating is not a recommendation to purchase, hold or sellthe Certificate in as much as the ratings do not commenton the market price of the Certificate or its suitability to aparticular investor. There is no assurance by the ratingagency either that the rating will remain at the same levelfor any given period of time or that the rating will not belowered or withdrawn entirely by the rating agency.

• Risk of Co-mingling: The servicer normally deposit allpayments received from the Obligors into the CollectionAccount. However, there could be a time gap betweencollection by a servicer and depositing the same into theCollection account especially considering that some ofthe collections may be in the form of cash. In this interimperiod, collections from the Loan Agreements may notbe segregated from other funds of the servicer. If theservicer fails to remit such funds due to Investors, theInvestors may be exposed to a potential loss. Due careis normally taken to ensure that the servicer enjoyshighest credit rating on stand alone basis to minimizeCo-mingling risk.

Risk Factors - Derivatives

• Counter Party Risk: This is the risk of default ofobligations by the counter party.

• Market risk: Derivatives carry the risk of adversechanges in the market price.

• Illiquidity risk: The risk that a derivative cannot be sold orpurchased quickly enough at a fair price, due to lack ofliquidity in the market.

• Basis Risk: the risk that the movements in swap ratesdoes not actually reflect the expected movement inbenchmark rates, thus, creating a mismatch with whatwas intended.

The guidelines issued by Reserve Bank of India from timeto time for forward rate agreements, interest rate swaps,

futures and other derivative products would be adhered to.The Scheme may also use various derivative and hedgingproducts from time to time, as would be available andpermitted by SEBI/RBI, in an attempt to protect the value ofthe portfolio. As and when the Scheme trades in the derivatives marketthere are risk factors and issues concerning the use ofderivatives that investors should understand. Derivative products are specialised instruments that requireinvestment techniques and risk analysis. The use of aderivative requires an understanding not only of theunderlying instrument but also of the derivative itself.Derivatives require the maintenance of adequate controlsto monitor the transactions entered into, the ability toassess the risk that a derivative adds to the portfolio andthe ability to forecast price or interest rate movementscorrectly. There is the possibility that a loss may besustained by the portfolio as a result of the failure of anotherparty (usually referred to as the "counter party") to complywith the terms of the derivatives contract. Other risks inusing derivatives include the risk of mispricing or impropervaluation of derivatives and the inability of derivatives tocorrelate perfectly with underlying assets, rates andindices. Thus, derivatives are highly leveraged instruments.Even a small price movement in the underlying instrumentcould have a large impact on their value. Also, the marketfor derivative instruments is nascent in India.The Scheme may use techniques such as interest rateswaps, options on interest rates, futures, warrants, forwardrate agreement and other derivative instruments that are /may be permitted under SEBI/RBI Regulation. Thesetechniques and instruments, if imperfectly used, have therisk of the Scheme incurring losses due to mismatches,particularly in a volatile market. The Scheme ability to usethese techniques may be limited by market conditions,regulatory limits and tax considerations (if any).Derivative products are leveraged instruments and canprovide disproportionate gains as well as disproportionatelosses to the investor. Execution of such strategiesdepends upon the ability of the fund manager to identifysuch opportunities. Identification and execution of thestrategies to be pursued by the fund manager involveuncertainty and decision of the fund manager may notalways be profitable. No assurance can be given that thefund manager will be able to identify or execute suchstrategies.The risks associated with the use of derivatives are differentfrom or possibly greater than, the risks associated withinvesting directly in securities and other traditionalinvestments.

Minimum Number of Investors & Single-Investor Limit

As per SEBI Regulations, the Scheme shall have aminimum of 20 investors and no single investor shallaccount for more than 25% of the corpus of the Scheme in



SOBNo.5

each calender quarter on an average basis. In case theScheme does not have a minimum of 20 investors in thestipulated period, the provisions of Regulation 39(2)(c) ofthe SEBI (MF) Regulation would become applicableautomatically without any reference from SEBI andaccordingly the Scheme shall be wound up and the unitswould be redeemed at applicable NAV. The two conditionsmentioned above shall also be complied within eachsubsequent calendar quarter thereafter, on an averagebasis, as specified by SEBI. If there is a breach of the 25%limit by any investor over the quarter, a rebalancing periodof one month would be allowed and thereafter the investorwho is in breach of the rule shall be given 15 days noticeto redeem his exposure over the 25% limit. Failure on thepart of the said investor to redeem his exposure over the25% limit within the aforesaid 15 days would lead toautomatic redemption by the Mutual Fund on theapplicable Net Asset Value on the 15th day of the noticeperiod. The Fund shall adhere to the requirementsprescribed by SEBI from time to time in this regard.

Special Considerations

Prospective investors should review / study this SchemeInformation Document carefully and in its entirety and shallnot construe the contents hereof or regard the summariescontained herein as advice relating to legal, taxation, orfinancial/ investment matters and are advised to consulttheir own professional advisor(s) as to the legal or any otherrequirements or restrictions relating to the subscription,gifting, acquisition, holding, disposal (sale, transfer, switchor redemption or conversion into money) of units and to thetreatment of income (if any), capitalisation, capital gains,any distribution, and other tax consequences relevant totheir subscription, acquisition, holding, capitalisation,disposal (sale, transfer, switch or redemption or conversioninto money) of units within their jurisdiction / of nationality,residence, domicile etc. or under the laws of anyjurisdiction to which they or any managed Scheme to beused to purchase/gift units are subject, and (also) todetermine possible legal, tax, financial or otherconsequences of subscribing / gifting to, purchasing orholding units before making an application for units.Neither this Scheme Information Document nor the unitshave been registered in any jurisdiction. The distribution ofthis Scheme Information Document in certain jurisdictionsmay be restricted or subject to registration requirementsand, accordingly, persons who come into possession ofthis Scheme Information Document in certain jurisdictionsare required to inform themselves about, and to observe,any such restrictions. No person receiving a copy of thisScheme Information Document or any accompanyingapplication form in such jurisdiction may treat this SchemeInformation Document or such application form asconstituting an invitation to them to subscribe for units, nor

should they in any event use any such application form,unless in the relevant jurisdiction such an invitation couldlawfully be made to them and such application form couldlawfully be used without compliance with any registration orother legal requirements. Neither the delivery of thisScheme Information Document nor any sale madehereunder shall, under any circumstances, create anyimplication that the information contained herein is correct.

Details under FATCA/Foreign Tax Laws:

The Foreign Account Tax Compliance Act (FATCA) is aUnited States law aimed at prevention of tax evasion byU.S. citizens and residents through use of offshoreaccounts. The FATCA provisions were included in theHiring Incentives to Restore Employment (HIRE) Act,enacted by the US legislature to create employmentopportunities in the US. FATCA is designed to increasecompliance by U.S. taxpayers and is intended to bolsterefforts to prevent tax evasion by the US tax payers withoffshore investments. The Government of India and theUnited States of America (US) have reached an agreementin substance on the terms of an Inter-GovernmentalAgreement (IGA) to implement FATCA. Sundaram Mutual Fund / the AMC is classified as a ‘ForeignFinancial Institution’ under the FATCA provisions.Accordingly, the AMC / Mutual Fund will be required toundertake due diligence process and identify USreportable accounts and collect such information /documentary evidences of the US and / or non-US statusof its investors / Unit holders and disclose such information(directly or through its agents or service providers) as far asmay be legally permitted about the holdings / investmentreturns to US Internal Revenue Service (IRS) and / or theIndian Tax Authorities.The AMC has registered with USInternal Revenue Service (IRS) and has obtained a GlobalIntermediary Identification Number (GIIN):EY9227.99999.SL.356 for the said reporting purposes.FATCA due diligence will be directed at each investor / Unitholder (including joint investor) and on being identified asa reportable person / specified US person, all the folios willbe reported. In case of folios with joint holders, the entireaccount value of the investment portfolio will be attributableunder each such reportable person. An investor / Unitholder will therefore be required to furnish such informationas and when sought by the AMC in order to comply withthe information reporting requirements stated in IGA andcirculars issued by SEBI in this regard from time to time.The information disclosed may include (but is not limitedto) the identity of the investors and their direct or indirectbeneficiaries, beneficial owners and controlling persons.Investors / Unitholders should consult their tax advisorsregarding FATCA requirements with respect to theirsituation.



In this document, the following words and expressions shall have the meaning specified herein, unless the context otherwise

requires:

Applicable NAV:

Please refer to the “Highlights & Scheme Summary” section forming part of this document

Benchmark: The index for evaluating the performance of the Scheme.

Business Day

A day other than

• A Saturday;

• A Sunday;

• A day on which there is no RBI clearing/settlement of securities;

• A day on which the Reserve Bank of India and/or banks in Mumbai are closed for business/clearing;

• A day on which the Stock Exchange, Bombay or National Stock Exchange of India or RBI and/or banks are closed;

• A day which is a public and/or bank holiday at an investor centre where the application is received;

• A day on which sale/redemption/switch of units is suspended by the Investment Manager / Trustee;

• A day which falls within a book closure period announced by the Trustee / Investment Manager and

• A day on which normal business cannot be transacted due to storms, floods, bandh, strikes or such other events as the

Investment Manager may specify from time to time.

The Investment Manager reserves the right to declare any day as a business day or otherwise at any or all branches /

Investor Service Centres.

Custodian: A person who has been granted a certificate of registration to carry on the business of custodian of securities

under the Securities and Exchange Board of India (Custodian of Securities) Regulation, 1996 and includes any entity

appointed to act as custodian in respect of foreign securities (including approved banks).

First Time Mutual Fund Investor: An investor who invests for the first time ever in any mutual fund either by way of

purchase/subscription or Systematic Investment Plan.

Investment Management Agreement: Investment Management Agreement dated August 24, 1996, executed between

the Trustee and the Investment Manager as amended from time to time.

Investment Manager: Sundaram Asset Management Company Limited incorporated under the provisions of the

Companies Act, 1956 and approved by the Securities and Exchange Board of India to act as the Investment Manager for

the Schemes of Sundaram Mutual Fund. AMC is also called as Investment Manager alternatively.

Investor Service Centres or Official Points of acceptance of transactions: Designated branches of Sundaram Asset

Management Limited or such other centres/offices as may be designated by the Investment Manager or its registrars from

time to time.

Mutual Fund or the Fund: Sundaram Mutual Fund, a trust set up under the provisions of the Indian Trust Act, and registered

with SEBI vide Registration No.MF/034/97/2.

NAV: The Net Asset Value per unit of the Scheme, calculated in the manner provided in the Scheme Information Document,

as may be prescribed by SEBI Regulation from time to time.

Regulations: Securities and Exchange Board of India (Mutual Funds) Regulation 1996 as amended from time to time.

Trustee: Sundaram Trustee Company Limited, as incorporated under the Provisions of the Companies Act, 1996, and

approved by SEBI to act as Trustee to the Scheme of Sundaram Mutual Fund.

Trust Deed: The Trust Deed dated March 31st 2006 (as amended from time to time) establishing the Mutual Fund.

Unit Holder: The term unit holder and investor has been used interchangeably in this document.


Sundaram Banking & PSU Debt FundDefinition

Definition

AbbreviationIn this document, an investor may find the following abbreviations.

AMC Asset Management CompanyAMFI Association of Mutual Funds in IndiaAML Anti-Money LaunderingAUM Assets Under ManagementBSE Bombay Stock Exchange LimitedSBNPPFS Sundaram BNP Paribas Fund Services LimitedCBLO Collateralised Borrowing and Lending ObligationCCC Cuntomer Care CentreCDSC Contingent Deferred Sales ChargeECS Electronic Clearing SystemEFT Electronic Funds TransferFATCA Foregin Account Tax Compliance ActFPI Foreign Portfolio InvestorFRA Forward Rate AgreementHUF Hindu Undivided FamilyIMA Investment Management AgreementIRS Interest Rate SwapKIM Key Information MemorandumKYC Know Your CustomerMFU Mutual Fund UtilityNAV Net Asset ValueNRI Non-Resident IndianNSE National Stock Exchange of India LimitedPAN Permanent Account NumberPIO Person of Indian OriginPMLA Prevention of Money Laundering Act, 2002POS Points of ServiceRBI Reserve Bank of IndiaRTGS Real Time Gross SettlementSAI Statement of Additional InformationSEBI Securities and Exchange Board of IndiaSEBI Act Securities and Exchange Board of India Act, 1992SEFT Special Electronic Funds TransferSI Standing InstructionsSID Scheme Information DocumentSIP Systematic Investment PlanSTP Systematic Transfer PlanSWP Systematic Withdrawal Plan


Sundaram Banking & PSU Debt FundAbbreviation & Interpretation

Due Diligence by Sundaram Asset Management Company LimitedIt is confirmed that: • The Scheme

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