NFO PERIOD DECEMBER 31, 2015 MARCH

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1 This product is suitable for investors who are seeking: Capital appreciation over a period of 10 years. Investment in equity and equity related instruments of companies along with income tax benefit under section 80C of the Income Tax Act NFO PERIOD DECEMBER 31, 2015 MARCH 30, 2016

2 PRESENTATION FLOW TAX PLANNING INVESTMENT IN EQUITIES SBI LONG TERM ADVANTAGE FUND SERIES III SYNOPSIS SBI FUNDS MANAGEMENT PVT. LTD. DISCLAIMER

3 TAX PLANNING

4 WHY DO I NEED TO PLAN? Its very important to have an active control of your finances: Don t let inflation & taxes eat into your wealth Idle money looses its value over time due to inflation, hence investing it in an appropriate instrument is important A well made tax plan can help you save a substantial part of your wealth An efficient tax-plan not only helps in saving wealth from eroding but may also generates optimal returns on the investments. Analyzing the available investment options is crucial to maximize the benefits Only you can make yourself rich: The sooner you start Planning the better it is.

5 TAX SAVING INVESTMENTS Market Linked ELSS Lock-in 3 years ULIP Lock-in 5 years Tax Planning PPF Lock-in 15 years Fixed Income NSC Lock-in 5/10 years Tax Saving Fixed Deposits Lock-in 5 year

6 TAX SAVING INSTRUMENTS: SNAPSHOT Particulars PPF NSC ELSS Bank Deposits ULIP Tenure (years) 15 5/ Min. investment (Rs) ,000 10,000 Max. investment under 80 C (Rs) 1,50,000 1,50, ,000 1,50,000 1,50,000 Risk Low Low High Low Medium to High Return % (CAGR) 8.70^ 8.50/8.80^ Market Linked 7.00* Market Linked Interest frequency Compounde d annually Compounded half yearly No assured dividends/ returns Compounded Quarterly NA Taxation of interest Tax free Taxable Dividend & capital gains tax free Taxable NA *Source : State Bank of India Date: Dec 08, 2014 ^ Source: RBI, Rates incorporates compounding wherever applicable Disclaimer: The comparison of ELSS Vs other tax savings instrument has been given for the purpose of the general information only. Any investment decision needs to be taken only after consulting the Tax Consultant or Financial Advisor. SBI MF will not accept any liability/ responsibility/loss incurred on any investment decision taken on the basis of this presentation.

7 BENEFIT OF INVESTMENT IN ELSS ELSS (Equity Linked Savings Scheme) are diversified equity funds with a lock-in period of 3 years. These funds offer tax benefits (Individual / HUF) under Section 80C of IT Act,1961 according to which, investment up to Rs lakh in ELSS is deductible from taxable income Illustration: Annual Taxable Income (Rs.) Tax before investment in ELSS (Rs.) Maximum investment eligible for deduction in ELSS (Rs.) Taxable income post ELSS Investment (Rs.) Tax after investment (Rs.) Savings (Rs.) 4,00,000 15,000 1,50,000 2,50, ,000 6,00,000 45,000 1,50,000 4,50,000 20,000 25,000 8,00,000 85,000 1,50,000 6,50,000 55,000 30,000 10,00,000 1,25,000 1,50,000 8,50,000 95,000 30,000 12,00,000 1,85,000 1,50,000 10,50,000 1,40,000 45,000 Helps in saving considerable amount of taxes if planned efficiently. The above table has been given for general information only. Investors are advised to consult their Tax/ Financial Advisor before taking decision of Investment. The tax calculations shown above are as per the IT slab applicable to Individual/ HUF assessee for FY exclusive of cess & surcharge.

8 INVESTMENT IN EQUITIES

9 WHY INVEST IN EQUITIES? Equities as an Asset class are considered to be high risk but at the same time also have the potential to deliver relatively higher returns Equity investments are always best suited for long term investors Equity as an asset class can provide inflation adjusted real returns Equity asset class comes with high volatility but can build wealth for investors over a long term

10 ALSO GAINS ARE TAX FREE It is important to take into consideration the taxes applicable for your investment The long term capital appreciation in equity mutual funds are tax free for the investors (as per current tax laws) Dividends (if any) declared in equity mutual funds are tax-free. (as per current tax laws) Post tax returns is an important aspect of an investment analysis

11 IS THIS THE RIGHT TIME TO INVEST? Investors are often confused about the right time to invest, but investment timing is almost irrelevant for a long term investor. Market volatility is a part of equity investing. A long term investor should not fear about the short term market movements. Global uncertainty High Fiscal Defiict Volatile Markets Valuations?? Which way is the market going?? REMEMBER TIME, NOT TIMING IS THE KEY TO SUCCESSFUL INVESTING.

12 EARNINGS GROWTH SET TO REVIVE Sensex earnings have grown at CAGR of 14% over the last 22 years In the recent past, earnings growth have been muted and concentrated in few sectors. A new cycle of corporate earnings growth has begun. Also, growth is likely to be far more broad-based. Data source: Motilal Oswal Past performance may or may not be sustained in future.

13 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Domestic Institutions holding in equity market on the rise FII inflow has been muted YTD- particularly in equities Domestic MFs, on other hand, were buyers for sixth consecutive quarter India: Net FII Debt Investment (USD bn) India: Net FII Equity Investment (USD bn) (as of Nov) DIIs (ex MFs) have also been net buyers for most part of the year USD bn Muted FII inflows have been duly compensated by domestic investors who have increased their appetite for equity. This increase in equity investments is driven by concurrent sluggishness in physical assets like gold and real estate It is also driven by the need for financialization of assets among the domestic investors. As a result we are witnessing a surge in IPO activity which we believe will continue to be the flavour Source: NSDL, MOSL, SBIMF Research

14 AND IMPORTANTLY TIME NOT TIMING IS IMPORTANT Daily Rolling Returns of S & P Sensex Index for Various Periods During Jan 01, 1990 to Dec 31, * As the investment time horizon increases chances of losing money decreases In case investor would had invested in S & P Sensex for 3 years, ~83% times he would had got positive returns and ~51% times he would had got more than 10% CAGR returns. In case investor would had invested in S & P Sensex for 10 years, ~99% times he would had got positive returns and ~82% times he would had got more than 10% CAGR returns. *Past performance may or may not be sustained in future.

15 PRESENTING This product is suitable for investors who are seeking: Capital appreciation over a period of 10 years. Investment in equity and equity related instruments of companies along with income tax benefit under section 80C of the Income Tax Act 1961.

16 SCHEME FEATURES Scheme Objective: The investment objective of the scheme is to generate capital appreciation over a period of ten years by investing predominantly in equity and equity-related instruments of companies along with income tax benefit. However, there can be no assurance that the investment objective of the Scheme will be realized. Asset Allocation Instruments Equities, cumulative convertible preference shares and fully convertible debentures and bonds of companies Indicative allocations (% of total assets) New Fund Offer (NFO)Period* 31 st December, th March, 2015 Risk Profile Min Max High/ Medium/ Low High Money Market instruments 0 20 Low to Medium The scheme shall not invest in Derivatives. The Scheme shall not invest in Securitized Debt. The Scheme shall not invest in repo in corporate debt. The Scheme shall not invest in ADR/GDR/Foreign securities. The Scheme shall not engage in stock lending. The Scheme shall not engage in short selling. Fund Type Minimum Investment Options Liquidity 10 Years Close Ended Equity Linked Savings Scheme Rs. 500 and in multiples of Rs. 500/- thereafter The scheme would have two plans viz Direct Plan & Regular Plan. Both plans will have two options Growth and Dividend options. Dividend option will have the facility of Payout & Transfer. After 3 Year of Lock-in period Benchmark S & P BSE 500 *As per SEBI regulations, investment out of the NFO proceeds shall be made only on or after the closure of the NFO period. The mutual fund shall allot units/refund of money and dispatch statements of accounts within five business days from the closure of the NFO.

17 ADVANTAGE OF SBI LONG TERM ADVANTAGE FUND SERIES III SBI Long Term Advantage Fund - Series III offer tax benefits (Individual / HUF) under Section 80C of IT Act,1961 according to which, investment up to Rs 1.50 lakh in ELSS is deductible from taxable income SBI Long Term Advantage Fund - Series III has a lock-in of 3 years which ensures a compulsory discipline for the investors to invest for long term Although lock-in period is of three years, investors can stay invested upto ten years. This gives them flexibility to redeem their investments at any time after three year but before ten year This also allows the fund manager to manage the fund more efficiently, as it gives the fund managers the flexibility to make investment decisions with a long term view SBI Long Term Advantage Fund - Series III will be an actively managed fund providing the advantage of managing the portfolio dynamically to adapt with the changing market scenarios The scheme will also invest across sectors & market caps offering the much needed diversification benefit to the investors

18 INVESTMENT PHILOSOPHY Three parts of investment strategy Asset allocation, Top down & Bottom-up approach Fundamental proprietary research underpinning portfolio construction Portfolio bias towards companies with strong business fundamentals Detecting unique businesses Sound management quality, Business fundamental, geared into key factors driving business expansion Companies set to develop sector leadership by leveraging upon existing franchises Relative valuation; visibility and sustainability in earnings growth Disciplined investment process Rigorous and systematic analysis of targeted companies Strategy taking a long term, three-year view on stocks value creation potential

19 PORTFOLIO CONSTRUCTION PROCESS STEP 1: Qualitative Factors 1. Analysis of business 2. Analysis of business model 3. Impact of Macro-economic variables on the business model 4. External variables and its impact on the company 5. Sell-side research interaction STEP 2: External Analysis 1. Geo-Politics and its impact on business 2.Competition analysis 3. Channel checks 4.Management Meetings 5. Corporate Governance 6.Plant visits STEP 3: Quantitative Factors 1. Historical Financial analysis 2.Earnings projection 3. Capital Efficiency projections 4. Application of risk metrics and discount STEP 4: Investment Thesis 1. Building investment thesis 2. Valuation model 3.Target price 4. Attractiveness vis-a-vis other stocks in the investment universe STEP 5: Investment Decision 1 Portfolio Composition 2. Continuous Monitoring

20 SYNOPSIS A ten year close ended ELSS with 3 year lock in. Triple Benefits of Investing in SBI Long Term Advantage Fund - Series III Tax Savings Potential Capital Appreciation Tax Free Returns To identify stocks across market cap utilizing both Top Down and Bottom Up approach No Investment Bias: The scheme may invest in Large, Mid & Small Capitalization stocks in any proportion Targeted towards investors wishing to save tax and having a long term investment horizon

21 SBI FUNDS MANAGEMENT PVT. LTD. India s premier and largest bank with over 200 years experience (Estd: 1806) Asset base of USD 399 bn* Pan-India network of ~22,635 branches and ~ 50,000 ATM s as at end of June 2014 Servicing over 256 million customers Only Indian bank in Fortune 500 list; ranked among the top 100 banks in the world Global leader in asset management Backed by Credit Agricole and Société Générale More than 2,000 institutional clients and distributors in 30 countries Over 100 million retail clients via its partner networks bn AuM as at end of June 2014 Ranking N 1 in Europe, Top 10 worldwide # 63% 37% *Source: SBI Analyst Presentation as on end June 2014 # Source : Amundi website as on end June 2014

22 DISCLAIMER This presentation is for information purposes only and is not an offer to sell or a solicitation to buy any mutual fund units/securities. These views alone are not sufficient and should not be used for the development or implementation of an investment strategy. It should not be construed as investment advice to any party. All opinions and estimates included here constitute our view as of this date and are subject to change without notice. Neither SBI Funds Management Private Limited, nor any person connected with it, accepts any liability arising from the use of this information. The recipient of this material should rely on their investigations and take their own professional advice. Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

23 THANK YOU