Kotak Services Fund

SECTION I SCHEME INFORMATION DOCUMENT (SID) KOTAK SERVICES FUND < S.O 1> An open-ended equity scheme following services theme< S.O 1> This product is suitable for investors who are seeking*: < S.O 3> Scheme Risk-o-meter# Benchmark (Nifty Services Sector This product is suitable for TRI (Total Return Index)) Risk-o- investors who are seeking* meter • Long term capital growth • Investment in portfolio of predominantly Equity & Equity related instruments of companies engaged in Services theme * Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

#The above product labelling assigned during the New Fund Offer (NFO) is based on internal assessment of the scheme characteristics or model portfolio and the same may vary post NFO when the actual investments are made Offer for Units of Rs 10 each for cash during the New Fund Offer and Continuous offer for Units at NAV based prices

New Fund Offer Opens on: _____

New Fund Offer Closes on: ______ Scheme re-opens on or before: _______ Name of Mutual Fund Kotak Mahindra Mutual Fund Name of Asset Management Kotak Mahindra Asset Management Company Ltd

Company CIN: U65991MH1994PLC080009 Name of Trustee Company Kotak Mahindra Trustee Company Ltd

CIN: U65990MH1995PLC090279 1Address of the Companies 27 BKC, C-27, G Block, Bandra Kurla Complex, Bandra (E), Mumbai – 400051 Corporate Address of the Asset 2nd Floor, 12-BKC, Plot No. C-12, G-Block, Bandra Kurla Management Company Complex, Bandra East, Mumbai – 400 051 Website www.kotakmf.com The particulars of the Scheme have been prepared in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations 1996, (herein after referred to as SEBI (MF) Regulations) as amended till date and circulars issued thereunder filed with SEBI, along with a Due Diligence Certificate from the AMC. The units being offered for public subscription have not been approved or recommended by SEBI nor has SEBI certified the accuracy or adequacy of the Scheme Information Document.

The Scheme Information Document sets forth concisely the information about the scheme that a prospective investor ought to know before investing. Before investing, investors should also ascertain about any further changes to this Scheme Information Document after the date of this Document from the Mutual Fund / Investor Service Centres / Website / Distributors or Brokers.

The investors are advised to refer to the Statement of Additional Information (SAI) for details of Kotak Mahindra Mutual Fund, Standard Risk Factors, Special Considerations, Tax and Legal issues and general information on www.kotakmf.com.

SAI is incorporated by reference (is legally a part of the Scheme Information Document). For a free copy of the current SAI, please contact your nearest Investor Service Centre or log on to our website.

The Scheme Information Document (Section I and II) should be read in conjunction with the SAI and not in isolation.

This Scheme Information Document is dated, August 11, 2025 2TABLE OF CONTENTS

SECTION I ...................................................................................................................................................... 1 Part I. HIGHLIGHTS/SUMMARY OF THE SCHEME ................................................................................ 4 DUE DILIGENCE BY THE ASSET MANAGEMENT COMPANY ......................................................... 9 Part II. INFORMATION ABOUT THE SCHEME ..................................................................................... 10 A. How Will The Scheme Allocate Its Assets? ......................................................................................... 10 B. Where Will The Scheme Invest? ........................................................................................................... 14 C. What Are The Investment Strategies? ................................................................................................... 15 D. How Will The Scheme Benchmark Its Performance? ........................................................................... 17 E. Who Manages The Scheme? ................................................................................................................. 17 F. How Is The Scheme Different From Existing Schemes Of The Mutual Fund? .................................... 20 G. How Has The Scheme Performed.......................................................................................................... 20 H. Additional Scheme Related Disclosures ................................................................................................ 20 Part III- OTHER DETAILS .......................................................................................................................... 22 A. Computation Of Nav ............................................................................................................................. 22 B. New Fund Offer (Nfo) Expenses ........................................................................................................... 23 C. Annual Scheme Recurring Expenses ..................................................................................................... 23 D. Load Structure ....................................................................................................................................... 26

Section II ....................................................................................................................................................... 28 I. INTRODUCTION ...................................................................................................................................... 28 A. Definitions/Interpretation ...................................................................................................................... 28 B. Risk Factors ........................................................................................................................................... 28 C. Risk Mitigation Strategies ..................................................................................................................... 37 II. INFORMATION ABOUT THE SCHEME: ......................................................................................... 40 A. Where Will The Scheme Invest – .......................................................................................................... 40 B. What Are The Investment Restrictions? ................................................................................................ 43 C. Fundamental Attributes ......................................................................................................................... 54 D. Other Scheme Specific Disclosures: ...................................................................................................... 55 III. OTHER DETAILS ................................................................................................................................ 68 A. Periodic Disclosures .............................................................................................................................. 68 B. Transparency/NAV Disclosure (Details With Reference To Information Given In Section I) ............. 70 C. Transaction Charges And Stamp Duty .................................................................................................. 70 D. Associate Transactions- ......................................................................................................................... 70 E. Taxation ................................................................................................................................................. 70 F. Rights Of Unitholders- Please Refer To SAI For Details. ..................................................................... 74 G. List Of Official Points Of Acceptance ................................................................................................... 74 H. Penalties, Pending Litigation Or Proceedings, Findings Of Inspections Or Investigations .................. 74 3Part I. HIGHLIGHTS/SUMMARY OF THE SCHEME Sr. No. Title Description I. Name of the scheme Kotak Services Fund II. Category of the Scheme Equity Schemes –Thematic III. Scheme type An open-ended equity scheme following services theme IV. Scheme code < S.O 7> To be obtained at the time of launch V. Investment objective The investment objective of the scheme is to provide long term capital < S.O 5> appreciation from an actively managed portfolio of equity and equity related securities of companies belonging to the services industry.

However, there can be no assurance that the investment objective of the scheme would be achieved.

VI. Liquidity/listing details The Scheme offers Units for Subscription and Redemption at NAV based prices on each Business Days on an ongoing basis.

Since the Scheme is open-ended, it is not necessary to list the units of the Scheme on any exchange.

VII. Benchmark (Total The performance of the Scheme is measured against Nifty Services Return Index) < S.O 25> Sector TRI (Total Return Index)

Rationale for adoption of benchmark:

The Nifty Services Sector Index is designed to reflect the behaviour and performance of services sector companies which includes Computers Software, IT Education & Training, Banks, Telecommunication services, Financial Institutions, Power, Media, Courier, Shipping etc.

The Index comprises of 30 companies listed on National Stock Exchange of India. Nifty Services Sector Index is computed using free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to particular base market capitalization value. The composition of the aforesaid benchmark is such that, it is most suited for comparing the performance of the scheme The AMC/Trustees may change benchmark in future for measuring performance of the scheme and as per the guidelines and directives issued by SEBI from time to time.

VIII. NAV disclosure The NAVs of the Scheme will be calculated and disclosed on every Business Day on the website of the Kotak Mahindra Mutual Fund viz www.kotakmf.com and AMFI’s website www.amfiindia.com by

11.00 p.m.

For further details, refer Section II.

IX. Applicable timelines Dispatch of redemption proceeds The Mutual Fund shall initiate payment of redemption or repurchase proceeds to the unitholders within three working days from the date of redemption or repurchase.

In case of exceptional situations listed in AMFI Circular No.

AMFI/35P/MEM-COR/74/2022-23 dated January 16, 2023, the scheme shall allowed additional timelines for transfer of redemption or repurchase proceeds to the unitholders.

4Dispatch of IDCW The Income Distribution cum capital withdrawal (IDCW) payments shall be dispatched to the unitholders within seven working days from the record date.

X. Plans and Options Plan- Direct Plan/Regular Plan Plans/Options and sub

options under the Scheme Direct Plan: This Plan is only for investors who purchase /subscribe Units in a Scheme directly with the Fund and is not available for investors who route their investments through a Distributor.

Regular Plan: This Plan is for investors who wish to route their investment through any distributor.

Options under each Plan(s) • Growth • Income Distribution cum Capital Withdrawal (IDCW) i) Payout of Income Distribution cum Capital Withdrawal Option ii) Reinvestment of Income Distribution cum Capital Withdrawal Option The NAVs of the above Options will be different and separately declared; the portfolio of investments remaining the same.

Investors are requested to note that, where the actual amount of IDCW payout is less than Rs. 500/-, then such IDCW will be compulsorily reinvested The AMC/Trustee reserve the right to introduce Options(s) as may be deemed appropriate at a later date subject to SEBI (MF) Regulations and circulars issued thereunder from time to time.

Default Option /Sub-Options • If applicant does not indicate the choice of option between growth and Income Distribution cum capital withdrawal

(IDCW) option in the application form, then the fund will accept it as an application for growth option under respective plan. • If applicant does not indicate the choice of Income Distribution cum capital withdrawal (IDCW) sub-option between payout of Income Distribution cum capital withdrawal (IDCW) and reinvestment of Income Distribution cum capital withdrawal

(IDCW) then the fund will accept it as an application for reinvestment of Income Distribution cum capital withdrawal

(IDCW).

For detailed disclosure on default plans and options, kindly refer SAI.

XI. Load Structure Exit Load: • For redemption / switch out within 90 days from the date of

allotment: 0.5% 5If units are redeemed or switched out on or after 90 days from the date of allotment -Nil Any exit load charged (net off Goods and Services tax, if any) shall be credited back to the Scheme. Units issued on reinvestment of IDCWs shall not be subject to entry and exit load No exit load will be chargeable in case of switches made between different plans/options of the scheme The AMC reserves the right to change / modify the Load structure of the Scheme, subject to maximum limits as prescribed under the SEBI

(MF) Regulations and circulars issued thereunder from time to time.

XII. Minimum Application Initial Purchase/Switch in - Rs. 1000/- and any amount thereafter Amount/switch in SIP Purchase - Rs. 500/- and any amount thereafter XIII. Minimum Additional Additional Purchase (Non- SIP) - Rs. 100/- and any amount thereafter Purchase Amount XIV. Minimum Redemption/switch out The minimum redemption amount for all plans will be Rs500/- or amount account balance, whichever is lower.

XV. New Fund Offer Period NFO opens on:

This is the period during NFO closes on: which a new scheme sells its units to the investors. To effectively manage the fund flows in NFO, the fund manager may extend or shorten the NFO period, based on his view of the market dynamics, availability of assets and his ability to deploy funds collected in NFO. However, the same shall be subject to compliance with Clause 1.10.1 and 1.10.1A of the SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 The AMC/ Trustee reserves the right to change the New Fund Offer period, subject to the condition that the New Fund Offer period shall be kept open for a minimum period of 3 working days and not beyond 15 days or such other time period as permissible under SEBI (MF) Regulations. AMC/ Trustee also reserves the right to close the subscription list earlier by giving at least one day’s prior notice. Any such modification shall be announced by way of a notice/ addendum uploaded on website of Kotak Mahindra Mutual Fund i.e.

www.kotakmf.com < S.O 34> XVI. New Fund Offer Price: Rs. 10 per unit This is the price per unit that the investors have to pay to invest during the NFO.

XVII. Segregated portfolio/side Segregation of portfolio has been enabled in the scheme. pocketing disclosure For Details, kindly refer SAI < S.O 53> XVIII Swing pricing disclosure Not Applicable XIX. Stock lending/short Stock Lending selling Stock lending has been enabled in the scheme.

For Details, kindly refer SAI 6Short selling Short Selling has not been enabled in the scheme XX. How to Apply and other Investors should apply through a common application form/online. details < S.O 35> Investors, are requested to go through the Guidelines / instructions in Key Information Memorandum (KIM) cum application form for filling up the application form before investing. The investors signature on the main application form shall be the basis for all future transactions processing. Existing investors can use their Folio number at the time of investing in the same scheme or any scheme of Kotak Mahindra Mutual Fund.

All cheques should be crossed "Account Payee Only" and drawn in favour the scheme name in which investment is intended to be made.

The investors can submit the Application forms and Key Information Memorandum (along with transaction slip)/ forms for redemption/ switches at the branches of AMC or Investor Service Centres

(ISCs)/Official Points of Acceptance (OPAs) of the Registrar (CAMS) or distributors or on the website of Kotak Mahindra Mutual Fund (www.kotakmf.com).

Investors are also advised to refer to Statement of Additional Information before submitting the application form.

For Further details refer section II.

XXI. Investor services • Contact details for general service requests:

18003091490 / 044-40229101 (Monday to Friday between

9.30am to 6.00 pm & Saturday between 9.30am to 12.30pm)

https://www.kotakmf.com/feedback/customer • Contact details for complaint resolution:

Ms. Sushma Mata, Investor Relations Officer Kotak Mahindra Asset Management Company Limited, 6th Floor, Kotak Towers, Building No.21, Infinity Park, Off: Western Express Highway Goregaon - Mulund Link Road, Malad(East), Mumbai 400097

Phone Number: 18003091490 / 044-40229101

Fax: 6708 2213 e-mail: https://info.kotakmf.com/write-to-us or WhatsApp us by sending us “Hi” at 9321884488. For portfolio valuation, give a missed call to 7039055555 XXII Specific attribute of the Not Applicable scheme (such as lock in, duration in case of target maturity scheme/close ended schemes) (as applicable) XXIII Special product/facility During NFO - Switch-In and Systematic Investment Plan are available available during the NFO during the NFO.

and on ongoing basis

Note: Investors of Kotak Liquid Fund, Kotak Overnight Fund (Source Schemes), holding units under growth option of any of these specified 7schemes, have an option to switch-in their units in the Scheme during the NFO period, subject to the terms and conditions mentioned in the Scheme Information Document of the respective schemes. In the event of the withdrawal/cancellation/calling off of the NFO, the switch request submitted by the investor shall not be processed and the investment shall be retained in the source scheme

Ongoing Basis:

The Following facilities are available under the Scheme.

1. Systematic Investment Plan

2. SIP Top Up Facility

3. Flex - Systematic Investment Plan Facility (‘FSIP’) Facility.

4. Flex - Systematic Transfer Plan (‘FSTP’) Facility

5. Systematic Withdrawal Plan

6. Systematic Transfer Plan

7. Transfer of Income Distribution cum capital withdrawal plan

(IDCW)

8. Switching

9. Trigger Facility

10. Daily frequency under Systematic Transfer Plan Facility

11. Variable Transfer Plan (‘VTP’)

12. SIP Pause Facility

13. Smart Facility i.e. Smart Systematic Investment Plan (SSIP”)/Smart Systematic Withdrawal Plan(“SSWP”)/Smart Systematic Transfer Plan(“SSTP”)

14. Freedom SIP Facility

15. Long Term Income For further details of above special products / facilities, kindly refer SAI XXIV. Weblink Link for Total Expense Ratio (TER) last 6 months, Daily TER as well as - https://www.kotakmf.com/Information/TER Link for scheme factsheet -

https://www.kotakmf.com/Information/statutory- disclosure/information 8DUE DILIGENCE BY THE ASSET MANAGEMENT COMPANY

It is confirmed that:

(i) The Scheme Information Document submitted to SEBI is in accordance with the SEBI (Mutual Funds) Regulations, 1996 and the guidelines and directives issued by SEBI from time to time.

(ii) All legal requirements connected with the launching of the Scheme as also the guidelines, instructions, etc., issued by the Government and any other competent authority in this behalf, have been duly complied with.

(iii) The disclosures made in the Scheme Information Document are true, fair and adequate to enable the investors to make a well-informed decision regarding investment in the Scheme.

(iv) The intermediaries named in the Scheme Information Document and Statement of Additional Information are registered with SEBI and their registration is valid, as on date.

(v) The contents of the Scheme Information Document including figures, data, yields etc. have been checked and are factually correct

(vi) A confirmation that the AMC has complied with the compliance checklist applicable for Scheme Information Documents and other than cited deviations/ that there are no deviations from the regulations

(vii) Notwithstanding anything contained in this Scheme Information Document, the provisions of the SEBI (Mutual Funds) Regulations, 1996 and the guidelines there under shall be applicable.

(viii) The Trustees have ensured that the Kotak Services Fund approved by them is a new product offered by Kotak Mahindra Mutual Fund and is not a minor modification of any existing scheme/fund/product.

Date: August 11, 2025 Name: Jolly Bhatt

Place: Mumbai Designation: Compliance Office 9Part II. INFORMATION ABOUT THE SCHEME A. HOW WILL THE SCHEME ALLOCATE ITS ASSETS? Indicative allocations (% Instruments of total assets) Minimum Maximum Equity & Equity related instruments of companies engaged in Services theme 80 100 Equity and Equity Related Securities Other than Services theme$ 0 20 Debt and Money Market Securities#* 0 20 Units of REITs & InvITs 0 10 #Debt instruments shall be deemed to include securitised debts (excluding foreign securitised debt) and investment in securitised debts may be up to 20% of the debt assets of the scheme in accordance with clause 1 of Seventh Schedule of SEBI (Mutual Funds) Regulations, 1996.

#Money Market instruments include commercial papers, commercial bills, treasury bills, Government securities having an unexpired maturity up to one year, call or notice money, certificate of deposit, usance bills, tri-party repos, and any other like instruments as specified by the Reserve Bank of India from time to time;

$In accordance with clause 4 of Seventh Schedule of SEBI (Mutual Funds) Regulations 1996 and in addition to Equity and Equity Related Securities Other than Services theme, the scheme may invest in the units of equity schemes of Kotak Mahindra Mutual Fund or any other Mutual Fund.

*In accordance with clause 4 of Seventh Schedule of SEBI (Mutual Funds) Regulations 1996 scheme may invest in the units of debt schemes of Kotak Mahindra Mutual Fund or any other Mutual Fund.

Pursuant to para 7.5and12.25 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, as may be amended from time to time, the scheme may also use various derivative and hedging products from time to time in a manner permitted by SEBI to reduce the risk of the portfolio as and when the fund manager is of the view that it is in the best interest of the unit holders. The scheme may invest upto 50% of the equity and equity related instruments in equity derivatives out of which non-hedge portion will not exceed 50 % of equity and equity related instruments < S.O 20> As per para 12.24 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, the cumulative gross exposure through equity, debt, derivative ,overseas securities, repo/ reverse repo transactions in corporate debt securities, Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts (InvITs), other permitted securities/assets and such other securities/assets as may be permitted by the Board from time to time should not exceed 100% of the net assets of the scheme. < S.O 17> Pursuant to para 12.25.3 of SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, Cash or cash equivalents with residual maturity of less than 91 days may be treated as not creating any exposure. Cash Equivalent shall consist of the following securities having residual maturity of less than 91 days:

a) Government Securities; b) T-Bills; and c) Repo on Government securities. < S.O 14> Pursuant to para 12.18 of SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, the scheme may participate in the corporate bond repo transactions. The gross exposure of the scheme to repo/reverse repo 10transactions in corporate debt securities shall not be more than 10% of the net assets of the scheme.

Investment in debt instruments having structured obligations / credit enhancements as per para 12.3 of SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 The investment of the Scheme in the following instruments shall not exceed 10% of the debt portfolio of the Scheme and the group exposure in such instruments shall not exceed 5% of the debt portfolio of the Scheme:- • Unsupported rating of debt instruments (i.e. without factoring-in credit enhancements) is below investment grade; and – • Supported rating of debt instruments (i.e. after factoring-in credit enhancement) is above investment grade.

As per para 12.11 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, as amended from time to time, the Trustee may permit the Fund to engage in securities lending and borrowing.

At present, since only lending is permitted, the fund may temporarily lend securities held with the Custodian to reputed counter-parties or on the exchange, for a fee, subject to prudent limits and controls for enhancing returns. The Scheme will lend securities subject to a maximum of 20%, in aggregate, of the net assets of the Scheme and 5% of the net assets of the Scheme in the case of a single intermediary.

The Scheme may invest upto 20% of the net assets in overseas securities including units issued by overseas Mutual Funds/Overseas Securities as may be permissible and described in para 12.19 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, as may be amended from time to time, within the overall applicable limits. < S.O 15> The Scheme can make overseas investments subject to a maximum of US $ 1 billion per Mutual Fund, within the overall industry limit of US $ 7 billion or such limits as may be prescribed by SEBI from time to time. The Scheme therefore may or may not be able to utilise the limit of USD 1 billion due to the USD 7 billion limit being exhausted by other Mutual Funds. SEBI vide letter dated 19th March 2024 & AMFI vide circular dated 20th March 2024, advised AMCs to stop subscriptions intending to invest in overseas ETFs w.e.f April 01,

2024. Investment in Overseas ETF will be made in accordance with para 12.19 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, as may be amended from time to time, as and when restriction is removed. < S.O 16> In accordance with 12.19.1.3 b, the intended amount for investment in overseas securities is US $ 5 Million.

The Scheme shall not invest in: < S.O 18> • Credit Default Swaps; • Debt instruments with special features as referred in Para 9.4, 4.4.4, 12.2 of SEBI Master circular No.

SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024; and • Fixed Income Derivatives. • Short Selling of Securities Apart from the investment restrictions prescribed under SEBI (MF) Regulations, the fund follows certain internal norms vis-à-vis limiting exposure to a particular scrip, issuer or sector, etc. within the mentioned restrictions, and these are subject to review from time to time. < S.O 19> Indicative Table (Actual instrument/percentages may vary subject to applicable SEBI circulars) < S.O 18> Sr. Type of Instrument Percentage of exposure Circular references No. (Maximum)

1. Securities Lending Aggregate - 20% of net assets of Para 12.11.2.1 of Master Circular the Scheme No.

Single intermediary - 5% of the net SEBI/HO/IMD/IMD-PoD- assets of the Scheme 1/P/CIR/2024/90 dated June 27, 2024

112. Equity Derivatives for The scheme may invest upto 50% Para 7.5 and 12.25 of SEBI non - hedging of the equity and equity related Master Circular no. instruments in equity derivatives SEBI/HO/IMD/IMD-PoD- out of which non-hedge portion 1/P/CIR/2024/90 dated June 27, will not exceed 50% of equity and 2024 equity related instruments.

3. Securitized Debt 20% of the debt assets of the Clause 1 of Seventh Schedule of scheme subject to limits applicable SEBI (Mutual Funds) in Clause 1 of Seventh Schedule of Regulations, 1996 SEBI (Mutual Funds) Regulations, 1996

4. Overseas Investments 20% of the net assets of the scheme Para 12.19 of SEBI Master

circular No.

SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024

5. Units of ReITS and InVITS 10% of the net assets of the scheme Para 12.21 of SEBI Master

circular No.

SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024

6. Repo/ Reverse Repo 10% of the net assets of the scheme Para 12.18 of SEBI Master transactions in corporate debt Circular no. securities SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024

7. Investment in debt 10% of debt portfolio at scheme Para 12.3 of SEBI Master instruments having structured level Circular no. obligations / credit 5% of debt portfolio per group SEBI/HO/IMD/IMD-PoD- enhancements 1/P/CIR/2024/90 dated June 27, 2024

8. Credit Default Swaps The Scheme shall not invest in N.A.

Credit default swaps

9. Debt instruments with The Scheme shall not invest Debt N.A. special features as referred to instruments with special features. in Para 9.4, 4.4.4, 12.2 of SEBI Master circular No.

SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024

10. Fixed Income Derivatives The Scheme shall not invest in N.A.

Fixed Income Derivatives

11. Short Selling of Securities The Scheme shall not engage in N.A Short Selling of Securities 12Portfolio Rebalancing: < S.O 22, 24 > As per para 2.9 of SEBI Master circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, in the event of any deviation from mandated asset allocation mentioned above, due to passive breaches, rebalancing period will be Thirty (30) business days. In case the portfolio is not rebalanced within Thirty (30) business days, justification in writing, including details of efforts taken to rebalance the portfolio shall be placed before the Investment Committee. The Investment Committee, if so desired, can extend the timelines up to sixty

(60) business days from the date of completion of mandated rebalancing period. In case the portfolio of the scheme is not rebalanced within the aforementioned mandated plus extended timelines, the AMC shall not launch any new scheme till the time the portfolio is rebalanced and also not levy exit load, if any on the investors exiting the Scheme. However, at all times the portfolio will adhere to the overall investment objective of the Scheme.

As per SEBI Circular SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/23 dated February 27, 2025, the scheme shall deploy the funds garnered in an NFO within 30 business days from the date of allotment of units.

In an exceptional case, if the AMC is not able to deploy the funds in 30 business days, reasons in writing, including details of efforts taken to deploy the funds, shall be placed before the Investment Committee of the AMC. The Investment Committee, if so desired, can extend the timelines up to sixty (60) business days from the date of completion of mandated deployment period.

Short Term Defensive Consideration < S.O 23, 24> As per Para 1.14.1.2 of SEBI Master circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, the asset allocation pattern indicated above may change for a short term period on defensive considerations, keeping in view market conditions, market opportunities, applicable regulations and political and economic factors. These proportions may vary depending upon the perception of the Fund Manager, the intention being at all times to seek to protect the interests of the Unit holders. In case of any deviation, the portfolio shall be rebalanced within 30 calendar days.

13B. WHERE WILL THE SCHEME INVEST? < S.O 29> The Scheme shall invest in the following securities as per the limits specified in the asset allocation table of Scheme, subject to SEBI (MF) Regulations. a. Equity and equity related securities including convertible bonds and debentures and warrants carrying the right to obtain equity shares b. Securities created and issued by the Central and State Governments and/or repos/reverse repos in such Government Securities as may be permitted by RBI (including but not limited to coupon bearing bonds, zero coupon bonds and treasury bills).

c. Debt obligations of domestic Government agencies and statutory bodies, which may or may not carry a Central/State Government guarantee (including but not limited to Indian Government Bond, State Development Loans issued and serviced at the Public Debt Office, Bonds issued by Central & State Government PSU’s which are guaranteed by Central or State Governments) d. Corporate debt (of both public and private sector undertakings) including Nonconvertible debentures (including bonds) and non-convertible part of convertible securities.

e. Short Term Deposits of banks (both public and private sector) and development financial institutions to the extent permissible under SEBI Regulations; f. Money market instruments permitted by SEBI/RBI, having maturities of up to one year but not limited to:

• Certificate of Deposits (CDs). • Commercial Paper (CPs) • Tri-party Repo, Bills re-discounting, as may be permitted by SEBI from time to time. • Repo/ Reverse Repo of corporate debt securities g. Securitised Debt, not including foreign securitised debt.

h. Investment in debt instruments having structured obligations / credit enhancements. i. Units of Mutual Funds Schemes; j. Units of overseas Mutual Funds schemes / ETFs(subject to withdrawal of SEBI restriction) .

k. ADRs, GDRs or other foreign securities. l. Securities Lending & Borrowing as permitted by SEBI from time to time m. Investment in units of Real Estate Investment Trust (‘REIT’) & Infrastructure Investment Trust (‘InvIT’).

n. Any other domestic fixed income securities as permitted by SEBI / RBI from time to time. o. Derivative instruments like, index futures, stock futures, index options, stock option, warrants, convertible securities, or any other derivative instruments that are permissible or may be permissible in future under applicable regulations.

14The securities/debt instruments mentioned above could be listed or unlisted, secured or unsecured, rated and of varying maturities and other terms of issue. The securities may be acquired through Initial Public Offerings

(IPOs), secondary market operations, private placement, rights offer or negotiated deals as per SEBI (MF) regulation. The Schemes may also enter into repurchase and reverse repurchase obligations in all securities held by it as per guidelines/regulations applicable to such transactions.

Transfer of investments from one scheme to another scheme in the same Mutual Fund, shall be allowed, in lines with para 12.30 of SEBI Master circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024. < S.O 30> Investment in overseas securities shall be made in accordance with the requirements stipulated by SEBI and RBI from time to time.

C. WHAT ARE THE INVESTMENT STRATEGIES? < S.O 27> The Scheme aims to provide long-term capital growth from an actively managed diversified portfolio of equity & equity related securities of companies that generate or expected to generate revenue from services. The investment strategy will be active in nature.

The indicative list as per AMFI industry classification of basic industry that the scheme would invest in is as follows: • Airline • Airport & Airport services • Asset Management Company • Business Process Outsourcing (BPO)/ Knowledge Process Outsourcing (KPO) • Computers - Software & Consulting • Depositories, Clearing Houses and Other Intermediaries • Diversified Commercial Services • Diversified Retail • Education • E-Retail/ E-Commerce • Exchange and Data Platform • Film Production, Distribution & Exhibition • Financial Institution • Financial Products Distributor • Financial Technology (Fintech) • Gas Transmission/Marketing • General Insurance • Healthcare Service Provider • Holding Company • Hospital • Hotels & Resorts • Housing Finance Company • Insurance Distributors • Integrated Power Utilities • Internet & Catalogue Retail • Investment Company 15• IT Enabled Services • Life Insurance • Logistics Solution Provider • LPG/CNG/PNG/LNG Supplier • Media & Entertainment • Non Banking Financial Company (NBFC) • Other Bank • Other Capital Market related Services • Other Financial Services • Other Insurance Companies • Other Telecom Services • Port & Port services • Power – Transmission • Power Distribution • Power Generation • Private Sector Bank • Public Sector Bank • Ratings • Restaurants • Road Assets–Toll, Annuity, Hybrid-Annuity • Shipping • Software Products • Stockbroking & Allied • Telecom - Cellular & Fixed line services • Tour, Travel Related Services • Trading & Distributors • TV Broadcasting & Software Production • Transportation & Logistics • Legal • Wellness • Microfinance Institutions • Wealth Management • Staffing Services • Waste Management • Water Supply & Management • Healthcare Research, Analytics & Technology The Fund Manager may add other industries or stocks as may be present in Nifty Services Sector TRI (Total Return Index) and AMFI industry classification list issued from time to time.

Although the scheme will predominantly invest in stocks as per the services related theme, it retains the flexibility to take some exposure other than services related theme based on the asset allocation pattern of the scheme.

The scheme may use Derivatives traded on recognized stock exchanges for the purpose of hedging, portfolio rebalancing and other purposes as may be permitted by SEBI.

16The scheme may invest in Debt & Money Market Instruments primarily for Liquidity purposes as well as for the purpose of meeting redemptions.

The scheme may look to invest overseas for the purpose of diversification in terms of markets and currency.

This can help the scheme in achieving higher returns, especially in markets that are experiencing strong economic growth or have undervalued assets. However, such exposure will be limited to a maximum of 20% of Net assets.

The Scheme may use SLBM for earning additional income for the scheme with a lesser degree of risk.

Scheme may invest in the units of Mutual Fund schemes of Kotak Mahindra Mutual Fund or any other Mutual Funds in terms of the prevailing SEBI (MF) Regulations.

The scheme may take an exposure in units of REIT and InvITs at an opportune time to generate income from real estate or infrastructure assets. Investing in units of REITs and InvITs has the potential to generate capital appreciation and regular income streams.

“The risks associated with the use of derivatives are different from or possibly greater than, the risks associated with investing directly in securities and other traditional investments”.

Portfolio Turnover: Portfolio Turnover is a term used to measure the volume of trading that occurs in a Scheme's portfolio during a given time period. The scheme being an open-ended scheme, it is expected that there would be frequent subscriptions and redemptions. Hence, it is difficult to estimate with any reasonable measure of accuracy, the likely turnover in the portfolio. Trading opportunities may arise due to changes in system liquidity, interest rate policy announced by RBI, shifts in the yield curve, change or anticipation of change in the credit worthiness or credit rating of securities or any other factors, which may lead to increase in the turnover. If trading is done frequently there may be an increase in transaction cost such as brokerage paid etc. The fund manager will endeavour to optimize portfolio turnover to maximize gains and minimize risks keeping in mind the cost associated with it. The Scheme has no specific target relating to portfolio turnover.

D. HOW WILL THE SCHEME BENCHMARK ITS PERFORMANCE? < S.O 25> The performance of the Scheme is measured against Nifty Services Sector TRI (Total Return Index)

Rationale for adoption of benchmark:

Benchmark Rationale- The Nifty Services Sector Index is designed to reflect the behaviour and performance of services sector companies which includes Computers Software, IT Education & Training, Banks, Telecommunication services, Financial Institutions, Power, Media, Courier, Shipping etc. The Index comprises of 30 companies listed on National Stock Exchange of India. Nifty Services Sector Index is computed using free float market capitalization method, wherein the level of the index reflects the total free float market value of all the stocks in the index relative to particular base market capitalization value. The composition of the aforesaid benchmark is such that, it is most suited for comparing the performance of the scheme The AMC/Trustees may change benchmark in future for measuring performance of the scheme and as per the guidelines and directives issued by SEBI from time to time.

E. WHO MANAGES THE SCHEME? < S.O 33> Mr. Rohit Tandon will be manager for Equity and Overseas investment of the Scheme. Mr. Abhishek Bisen will be the Fund Manager for debt investment of the Scheme.

17Name Age Qualification Business Experience Schemes Managed Mr. Rohit 47 B.E.(Mechanical) Mr. Rohit has over 19 years of • Kotak Quant Fund Tandon years Punjab University experience in equity research and • Kotak Balanced Chandigarh & fund management. Prior to Advantage Fund PGDM (IIM joining KMAMC he was the • • Kotak Bluechip Fund Bangalore) Head (Equities) at Reliance Nippon Life Insurance. Before that he has worked with Max Life Insurance as Senior Fund Manager (Equities) for 14 years.

He has also worked as a sell-side analyst in Power, Infrastructure & Capital Goods sectors in JP Morgan India for 4 years Mr. 45 B A Management, Mr. Abhishek Bisen has been • Kotak Balanced Abhishek Years MBA Finance associated with the company Advantage Fund Bisen EPAF- IIM-C since October 2006 and his key • Kotak Banking and responsibilities include fund Financial Services Fund management of debt schemes. • Kotak Banking and PSU Prior to joining Kotak AMC, Debt Fund Abhishek was working with • Kotak Bond Fund Securities Trading Corporation • Kotak Bond Short Term of India Ltd where he was Fund looking at Sales & Trading of • Kotak BSE Housing Fixed Income Products apart Index Fund from doing Portfolio Advisory.

• Kotak BSE PSU Index His earlier assignments also Fund include 2 years of merchant • Kotak BSE Sensex Index banking experience with a Fund leading merchant banking firm. • Kotak Business Cycle Fund • Kotak Consumption Fund • Kotak CRISIL-IBX AAA Bond Financial Services Index – Dec 2026 Fund • Kotak CRISIL-IBX AAA Financial Services Index - Sep 2027 Fund.

• Kotak Debt Hybrid Fund • Kotak Dynamic Bond Fund • Kotak Energy Opportunities Fund • Kotak Equity Hybrid Fund • Kotak Equity Savings Fund • Kotak Gilt Fund • Kotak Gold ETF • Kotak Gold Fund • Kotak Healthcare Fund 18• Kotak Income plus Arbitrage FOF • Kotak Long Duration Fund • Kotak Manufacture in India Fund • Kotak MNC Fund • Kotak MSCI India ETF • Kotak Multi Asset Allocation Fund • Kotak Multi Asset Allocator Fund of Fund - Dynamic • Kotak Multicap Fund • Kotak NASDAQ 100 Fund of Fund • Kotak Nifty 100 Equal Weight ETF • Kotak Nifty 100 Equal Weight Index Fund • Kotak Nifty 100 Low Volatility 30 ETF • Kotak Nifty 100 Low Volatility 30 Index Fund • Kotak Nifty 1D Rate Liquid ETF • Kotak Nifty 200 Momentum 30 Index Fund • Kotak Nifty 50 Equal Weight Index Fund • Kotak Nifty 50 Index Fund • Kotak Nifty AAA Bond Jun 2025 HTM Index Fund • Kotak Nifty Alpha 50 ETF • Kotak Nifty Commodities Index Fund • Kotak Nifty Financial Services Ex-bank Index Fund • Kotak Nifty G-Sec July 2033 Index Fund • Kotak Nifty India Consumption ETF • Kotak Nifty India Tourism Index Fund 19• Kotak Nifty Midcap 150 ETF • Kotak Nifty Midcap 150 Index Fund • Kotak Nifty Midcap 150 Momentum 50 Index Fund • Kotak Nifty Midcap 50 ETF • Kotak Nifty Midcap 50 Index Fund • Kotak Nifty MNC ETF • Kotak Nifty SDL Apr 2027 Top 12 Equal Weight Index Fund • Kotak Nifty SDL Apr 2032 Top 12 Equal Weight Index Fund • Kotak Nifty SDL Jul 2026 Index Fund • Kotak Nifty SDL Jul 2033 Index Fund • Kotak Nifty SDL Plus AAA PSU Bond Jul 2028 60 - 40 Index Fund • Kotak Nifty Small Cap 250 Index Fund • Kotak Nifty Smallcap 50 Index Fund • Kotak Nifty Top 10 Equal Weight Index Fund • Kotak Quant Fund • Kotak Silver ETF • Kotak Silver ETF Fund of Fund • Kotak Special Opportunities Fund • Kotak Technology Fund • Kotak Transportation and Logistics Fund F. HOW IS THE SCHEME DIFFERENT FROM EXISTING SCHEMES OF THE MUTUAL FUND? Kotak Services Fund is the only scheme of Kotak Mahindra Mutual Fund, that will follow the services theme.

No other existing thematic or sectoral fund is predominantly following the services theme.

The list of existing schemes under Equity schemes are given below:

1.Kotak Bluechip Fund

2.Kotak India EQ Contra Fund

3. Kotak Equity Opportunities Fund

204.Kotak Small Cap Fund

5.Kotak Infrastructure & Economic Reform Fund

6.Kotak Emerging Equity Fund

7.Kotak Focused Equity Fund

8.Kotak Pioneer Fund

9.Kotak ESG Opportunities Fund

10.Kotak ELSS Tax Saver Fund

11.Kotak Multicap Fund

12.Kotak Manufacture in India Fund

13.Kotak Business Cycle Fund

14.Kotak Banking & Financial Services Fund

15.Kotak Flexicap Fund

16.Kotak Consumption Fund

17.Kotak Healthcare Fund

18. Kotak Technology Fund

19. Kotak Quant Fund

20. Kotak Special Opportunities Fund

21. Kotak MNC Fund

22. Kotak Transportation & Logistics Fund

23. Kotak Energy Opportunities Fund

The detailed comparative table will be available in the given link:

https://www.kotakmf.com/Information/statutory-disclosure/disclosuresrelatedtosidandkim G. HOW HAS THE SCHEME PERFORMED This is a new scheme and does not have any performance track record.

H. ADDITIONAL SCHEME RELATED DISCLOSURES Since the scheme is a new fund to be launched, the following disclosures are not applicable. i. Scheme’s portfolio holdings: Not Applicable ii. Portfolio Disclosure – Not Applicable iii. Portfolio Turnover Rate: Not Applicable iv. Aggregate investment in the Scheme by Concerned Scheme Fund Managers: Not Applicable For any other disclosure w.r.t investments by key personnel and AMC directors including regulatory provisions in this regard kindly refer SAI.

v. Investments of AMC in the Scheme: < S.O 58> Pursuant to Regulation 25(16A) of the SEBI (MF) Regulations, 1996, AMC shall invest in the scheme based on the risk associated with the scheme as specified in para 6.9 of SEBI Master circular No.

SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 read with AMFI Best Practice Guidelines Circular 135/BP/100/2022-23 dated 26th April 2022 and any other circulars issued there under, from time to time.

21In addition to investments as mandated above, the AMC may invest in the Scheme subject to the SEBI

(MF) Regulations. Under the Regulations, the AMC is not permitted to charge any investment management and advisory services fee on its own investment in the Scheme.

Details of Investments of AMC in the Scheme will be available in the given link. -

https://www.kotakmf.com/Information/statutory-disclosure/information Part III- OTHER DETAILS A. COMPUTATION OF NAV The AMC shall compute NAV of the Units of the Scheme will be computed by dividing the net assets of the Scheme by the number of Units outstanding on the valuation date.

The AMC shall value its investments according to the valuation norms (Valuation Policy includes computation of NAV in case of investment in foreign securities), as specified in the Eighth Schedule of the Regulations, or such guidelines / recommendations as may be specified by SEBI from time to time. The broad valuation norms are detailed in the Statement of Additional Information.

NAV of Units under the Scheme will be calculated as shown below:

Market or Fair Current assets Current Liabilities N Value of + including Accrued - and provisions A Scheme’s Income including accrued V investments expenses = No. of Units outstanding under the Scheme/Option.

NAV for the Schemes and the repurchase prices of the Units will be calculated and announced at the close of each Business Day. The NAV shall be computed upto three decimals. The NAV of Direct Plan will be different than the NAV of Regular Plan.

Computation of NAV will be done after taking into account IDCWs paid, if any, and the distribution tax thereon, if applicable. Therefore, once IDCWs are distributed under the IDCW Option, the NAV of the Units under the IDCW Option would always remain lower than the NAV of the Units issued under the Growth Option. The income earned and the profits realized in respect of the Units issued under the Growth Option remain invested and are reflected in the NAV of the Units.

22Illustration for Computation of NAV: < S.O 42> As required under the Regulations, the asset management company shall ensure that the repurchase price of an open ended scheme shall not be lower than 95% of the Net Asset Value.

For other details such as policies w.r.t computation of NAV, rounding off, investment in foreign securities, procedure in case of delay in disclosure of NAV etc. refer to SAI.

B. NEW FUND OFFER (NFO) EXPENSES These expenses are incurred for the purpose of various activities related to the NFO like sales and distribution fees paid marketing and advertising, registrar expenses, printing and stationary, bank charges etc.

The AMC shall ensure that no NFO expenses will be charged to the Scheme.

C. ANNUAL SCHEME RECURRING EXPENSES These are the fees and expenses for operating the scheme. These expenses include Investment Management and Advisory Fee charged by the AMC, Registrar and Transfer Agents’ fee, marketing and selling costs etc.

as given in the table below:

The AMC has estimated that the following percentage daily net assets of the scheme will be charged to the scheme as expenses. For the actual current expenses being charged, the investor should refer to the website of the mutual fund viz. www.kotakmf.com As per Regulation 52(6)(c) of SEBI (MF) Regulations, the total expense ratio of the scheme excluding issue or redemption expenses, whether initially borne by the mutual fund or by the asset management company, but

including the investment management and advisory fee shall be subject to the following limits:- Assets under management Slab (In Rs. crore) Total expense ratio limits on the first Rs.500 crores of the daily net assets 2.25% on the next Rs.250 crores of the daily net assets 2.00% on the next Rs.1,250 crores of the daily net assets 1.75% on the next Rs.3,000 crores of the daily net assets 1.60% on the next Rs.5,000 crores of the daily net assets 1.50% on the next Rs.40,000 crores of the daily net assets Total expense ratio reduction of 0.05% for every increase of Rs. 5,000 crores of daily net assets or part thereof.

on balance of the assets 1.05% 23 N 1 0 A .1 0 V 9 = = M a r k e t oV a lu e o fS c h e m e ’in v e s t m e N 1 0 ,0 1 ,0 0 , 0 r sn o 0 F a t s . o 0 . 0 ir f U 0 n it + + s o u t C u r r e n t a s s e t s in c lu d in g A c c r u e d I n c o m s t a n d in g u n d e r 1 0 ,0 0 ,0 0 0 .0 0 1 ,0 0 ,0 0 ,0 0 0 .0 0 e t h e S - c h - e m C u r r e n t L ia b ilit ie s p r o v is io n s in c lu d in g a c c r u e d e x p e n s e s e / O p t io n .

1 0 ,0 0 0 .0 0 a n d 11 0 ,1,0 0 0 ,9,0 0 0 ,,0 00 00 0 ..0 00 0Total Expense Ratio for the scheme Expenses Structure % of daily Net Assets for Regular Plan of Kotak Services Fund Investment Management and Advisory Fees Audit fees/fees and expenses of trustees Upto 2.25% Custodial Fees Registrar & Transfer Agent Fees including cost of providing account statements / IDCW / redemption cheques/ warrants Marketing & Selling Expenses including Agents Commission and statutory advertisement Costs related to investor communications Costs of fund transfer from location to location Cost towards investor education & awareness (at least 2 bps) < S.O 43> Brokerage & transaction cost pertaining to distribution of units Goods & Services Tax on expenses other than investment and advisory fees Goods & Services Tax on brokerage and transaction cost Other Expenses (to be specified as per Reg 52 of SEBI MF Regulations) Maximum Total expenses ratio (TER) permissible under Regulation 52 Upto 2.25%

(6) (c) Additional expenses under Regulations 52(6A)(c) Upto 0.05% Additional expenses for gross new inflows from specified cities Upto 0.30% # The AMC shall not charge additional expenses under Regulation 52(6A)(c) in case exit load is not levied/ not applicable With reference to SEBI’s letter no. SEBI/HO/ IMD/ IMD-SEC-3/ P/ OW/ 2023/ 5823/ 1 dated February 24, 2023, and AMFI Circular No. CIR/ ARN-23/ 2022-23 March 07, 2023, the B-30 incentive structure for new inflows has been kept in abeyance with effect from March 01, 2023 till the incentive structure is appropriately re-instated by SEBI with necessary safeguards.

Expense Structure for Direct Plan – The annual recurring expenses will be within the limits specified under the SEBI (Mutual Funds) Regulations, 1996.

Commission/ Distribution expenses will not be charged in case of Direct Plan. The TER of Direct Plan will be lower than Regular Plan.

In terms of the SEBI Circular no. SEBI/HO/IMD/DF2/CIR/P/2018/137 dated October 22, 2018, all fees and expenses charged in a direct plan (in percentage terms) under various heads including the investment and advisory fee shall not exceed the fees and expenses charged under such heads in a regular plan.

However, Direct Plan shall have a lower expense ratio than the Regular Plan. The expenses would exclude distribution expenses, commission, etc and no commission for distribution of Units will be paid / charged under Direct Plan.

24Additional expenses which may be charged to the Scheme< S.O 46> The following additional expenses may be charged to the Schemes under Regulation 52 (6A), namely- • Brokerage and transaction cost incurred for the purpose of execution shall be charged to the schemes (a) upto 12 bps and 5 bps for cash market transactions and derivatives transactions respectively. Any payment towards brokerage & transaction costs, over and above the said 12 bps and 5 bps for cash market transactions and derivatives transactions respectively may be charged to the Scheme within the maximum limit of Total Expense Ratio (TER) as prescribed under Regulation 52 of the SEBI (Mutual Finds) Regulations, 1996.

• Expenses not exceeding of 0.30 % of daily net assets, if the new inflows from beyond top 30 cities are at

least:

(i) 30 % of gross new inflows in the scheme; or

(ii) 15 % of the average assets under management (year to date) of the scheme; whichever is higher.

Provided that if inflows from such cities is less than the higher of sub-clause (i) or sub- clause (ii), such expenses on daily net assets of the scheme shall be charged on proportionate basis.

Provided further that expenses charged under this clause shall be utilized for distribution expenses incurred for bringing inflows from such cities.

Provided further that amount incurred as expense on account of inflows from such cities shall be credited back to the scheme in case the said inflows are redeemed within a period of one year from the date of investment.

Provided further that the additional TER can be charged based on inflows only from ‘retail investors’ (Para

10.1.3 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD1/P/CIR/2024/90 dated June 27, 2024, has defined that inflows of amount upto Rs 2,00,000/- per transaction, by individual investors shall be considered as inflows from “retail investor”) from beyond top 30 cities.

Provided that the additional commission for beyond top 30 cities shall be paid as trail only.

In case inflows from beyond top 30 cities is less than the higher of (i) or (ii) above, additional TER on daily

net assets of the scheme shall be charged as follows:

Daily net assets X 30 basis points X New inflows from individual investors from beyond top 30 cities ------------------------------------------------------------------------------------------- 365* X Higher of (i) or (ii) above * 366, wherever applicable.

Additional expenses upto 0.05% of daily net assets of the schemes, incurred towards different heads mentioned under Regulation 52 (2) and 52 (4).

Clause 4 of Seventh Schedule to SEBI (Mutual Funds) Regulations, 1996 which restricts investments in mutual fund units upto 5% of net assets and prohibits charging of fees, shall not be applicable to investments in mutual funds in foreign countries made in accordance with guidelines as para 12.19 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024. However, the management fees and other expenses charged by the mutual fund(s) in foreign countries along with the management fee and recurring expenses charged to the domestic mutual fund scheme shall not exceed the total limits on expenses as prescribed under Regulation 52(6). Where the scheme is investing only a part of the net assets in the overseas mutual fund(s), the same principle shall be applicable for that part of investment.

TER for the Segregated Portfolio

1. AMC shall not charge investment and advisory fees on the segregated portfolio. However, TER (excluding the investment and advisory fees) can be charged, on a pro-rata basis only upon recovery of the investments in segregated portfolio.

252. The TER so levied shall not exceed the simple average of such expenses (excluding the investment and advisory fees) charged on daily basis on the main portfolio (in % terms) during the period for which the segregated portfolio was in existence.

3. The legal charges related to recovery of the investments of the segregated portfolio may be charged to the segregated portfolio in proportion to the amount of recovery. However, the same shall be within the maximum TER limit as applicable to the main portfolio. The legal charges in excess of the TER limits, if any, shall be borne by the AMC.

4. The costs related to segregated portfolio shall in no case be charged to the main portfolio.

Goods and Services tax:

Goods and Services tax on investment and advisory fees may be charged to the scheme in addition to the maximum limit of TER as prescribed in Regulation 52(6)(c). Goods and Services tax on other than investment and advisory fees, if any, shall be borne by the scheme within the maximum limit of TER as per Regulation

52.

The aforesaid estimates are made in good faith by the Investment Manager and are subject to change inter se among the various heads of expenses and between the Plans. It may also be noted that the total expenses of the Plans will also be subject to change within the overall limits of expenses under Regulation 52. Actual expenses under any head and / or the total expenses may be more or less than the estimates. The Investment Manager retains the right to charge the actual expenses to the Scheme, however the expenses charged will not exceed the statutory limit prescribed by the Regulations. There will be no sub limit on management fee, and it shall be within the overall TER specified above.

Illustration of impact of expense ratio on scheme’s returns: < S.O 44> Particulars Regular Plan Direct Plan Amount Invested at the beginning of the year 10,000 10,000 Annual Returns before Expenses 800 800 Expenses other than Distribution Expenses 75 75 Distribution Expenses / Commission 25 - Returns after Expenses at the end of the Year 700 725 Illustration is given to understand the impact of expense ratio on a scheme return and this should not be construed as an indicative return of the scheme. The expenses of the Direct Plan under the Scheme will be lower to the extent of distribution expenses/ commission.

D. LOAD STRUCTURE Exit Load is an amount which is paid by the investor to redeem the units from the scheme. Load amounts are variable and are subject to change from time to time. For the current applicable structure, please refer to the website of www.kotakmf.com or may call at 18003091490 or your distributor.

Type of Load Load chargeable (as % age of NAV) < S.O 47> Entry * Nil 26Exit** • For redemption / switch out within 90 days from the date of allotment: 0.5% • If units are redeemed or switched out on or after 90 days from the date of allotment -Nil Units issued on reinvestment of IDCW shall not be subject to entry and exit load.

* In terms of Para 10.4 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, no entry load will be charged on purchase / additional purchase / switch-in. The commission as specified in aforesaid circular, if any, on investment made by the investor shall be paid by the investor directly to the Distributor, based on his assessment of various factors including the service rendered by the Distributor.

** Any exit load charged (net off Goods and Services tax, if any) shall be credited back to the Scheme.

Any imposition or enhancement of Load in future shall be applicable on prospective investments only. For any change in load structure AMC will issue an addendum and display it on the website/Investor Service Centres. In case of changes in load structure the addendum carrying the latest applicable load structure shall be attached to all KIM and SID already in stock till it is updated.

Investors may obtain information on loads on any Business Day by calling the office of the AMC or any of the Investor Service Centers. Information on applicability of loads will also be provided in the Account Statement.

As required under the Regulations, the asset management company shall ensure that the repurchase price of an open ended scheme is not lower than 95% of the Net Asset Value. < S.O 47> The investor is requested to check the prevailing load structure of the scheme before investing.

27Section II I. INTRODUCTION A. Definitions/interpretation The detailed definitions/ interpretations refer to the link on website of the mutual fund viz.

https://www.kotakmf.com/Information/statutory-disclosure/disclosuresrelatedtosidandkim B. Risk factors< S.O 8> Scheme Specific Risk Factors The scheme will be largely affected by the risks associated with Services and related stocks. The Scheme will mainly invest in Services and related companies thereby limiting its exposure to Services Theme. This will limit the capability of the Scheme to invest in other themes.

• The scheme will be subjected to concentration risk as the fund is mandated to invest in particular theme. This may result in the Portfolio NAV to be more volatile as compared to a diversified portfolio.

• Accordingly, the scheme may also face a relatively higher liquidity risk owing to larger concentrations in their exposures in the event of any significant redemptions occurring in the scheme. • Owing to high concentration risk for thematic scheme, risk of capital loss is relatively high.

• Also, as with all equity investing, there is the risk that companies in Services theme will not achieve its expected earnings results, or that an unexpected change in the market or within the company may occur, both of which may adversely affect investment results. Thus, investing in a theme specific fund could involve potentially greater volatility and risk.

1. Risks associated with Capital Markets or Equity Markets (i.e. Markets in which Equity Shares or Equity oriented instruments are issued and traded) • Price fluctuations and Volatility:

Mutual Funds, like securities investments, are subject to market and other risks and there can be neither a guarantee against loss resulting from an investment in the Scheme nor any assurance that the objective of the Scheme will be achieved. The NAV of the Units issued under the Scheme can go up or down because of various factors that affect the capital market in general, such as, but not limited to, changes in interest rates, government policy and volatility in the capital markets. Pressure on the exchange rate of the Rupee may also affect security prices.

• Concentration:

When a Mutual Fund Scheme, by mandate, restricts its investments only to a particular theme; there arises a risk called concentration risk. If the theme, for any reason, fails to perform, the portfolio value will plummet and the Investment Manager will not be able to diversify the investment in any other theme. Investments under this scheme will be in a portfolio of diversified equity or equity related stocks spanning across a few selected themes. Hence the concentration risks could be high.

• Liquidity Risks:

Liquidity in Equity investments may be affected by trading volumes, settlement periods and transfer procedures. These factors may also affect the Scheme’s ability to make intended purchases/sales, cause potential losses to the Scheme and result in the Scheme missing certain investment opportunities. These factors can also affect the time taken by KMMF for redemption of Units, which could be significant in the event of receipt of a very large number of redemption requests or very 28large value redemption requests. In view of this, redemption may be limited or suspended after approval from the Boards of Directors of the AMC and the Trustee, under certain circumstances as described in the Statement of Additional Information.

• Potential Loss associated with Derivative Trading pertaining to Equity Markets a) In case of investments in index futures, the risk would be the same as in the case of investments in a portfolio of shares representing an index. The extent of loss is the same as in the underlying stocks. In case futures are used for hedging a portfolio of stocks, which is different from the index stocks, the extent of loss could be more or less depending on the coefficient of variation of such portfolio with respect to the index; such coefficient is known as Beta.

b) The risk (loss) for an options buyer is limited to the premium paid, while the risk (loss) of an options writer is unlimited, the latter's gains being limited to the premiums earned. The writer of a put option bears a risk of loss if the value of the underlying asset declines below the exercise price.

The writer of a call option bears a risk of loss if the value of the underlying asset increases above the exercise price

2. Risks associated with Debt / Money Markets (i.e. Markets in which Interest bearing Securities or Discounted Instruments are traded) i. Credit Risk:

Securities carry a Credit risk of repayment of principal or interest by the borrower. This risk depends on micro-economic factors such as financial soundness and ability of the borrower as also macro-economic factors such as Industry performance, Competition from Imports, Competitiveness of Exports, Input costs, Trade barriers, Favourability of Foreign Currency conversion rates, etc.

Credit risks of most issuers of Debt securities are rated by Independent and professionally run rating agencies. Ratings of Credit issued by these agencies typically range from "AAA" (read as "Triple A" denoting "Highest Safety") to "D" (denoting "Default"), with about 6 distinct ratings between the two extremes.

The highest credit rating (i.e. lowest credit risk) commands a low yield for the borrower.

Conversely, the lowest credit rated borrower can raise funds at a relatively higher cost. On account of a higher credit risk for lower rated borrowers lenders prefer higher rated instruments further justifying the lower yields.

ii. Price-Risk or Interest-Rate Risk:

From the perspective of coupon rates, Debt securities can be classified in two categories, i.e., Fixed Income bearing Securities and Floating Rate Securities. In Fixed Income Bearing Securities, the Coupon rate is determined at the time of investment and paid/received at the predetermined frequency. In the Floating Rate Securities, on the other hand, the coupon rate changes - 'floats' - with the underlying benchmark rate, e.g., MIBOR, 1 yr. Treasury Bill.

Fixed Income Securities (such as Government Securities, bonds, debentures and money market instruments) where a fixed return is offered, run price-risk. Generally, when interest rates rise, prices of fixed income securities fall and when interest rates drop, the prices increase. The extent of fall or rise in the prices is a function of the existing coupon, the payment-frequency of such coupon, days to maturity and the increase or decrease in the level of interest rates. The prices of 29Government Securities (existing and new) will be influenced only by movement in interest rates in the financial system. Whereas, in the case of corporate or institutional fixed income securities, such as bonds or debentures, prices are influenced not only by the change in interest rates but also by credit rating of the security and liquidity thereof.

Floating rate securities issued by a government (coupon linked to treasury bill benchmark or a real return inflation linked bond) have the least sensitivity to interest rate movements, as compared to other securities. The Government of India has already issued a few such securities and the Investment Manager believes that such securities may become available in future as well. These securities can play an important role in minimizing interest rate risk on a portfolio.

iii. Risk of Rating Migration:

The following table illustrates the impact of change of rating (credit worthiness) on the price of a hypothetical AA rated security with a maturity period of 3 years, a coupon of 10.00% p.a. and a market value of Rs. 100. If it is downgraded to A category, which commands a market yield of, say, 11.50% p.a., its market value would drop to Rs. 98.76 (i.e. 1.24%) If the security is up-graded to AAA category which commands a market yield of, say, 9.60% p.a. its market value would increase to Rs103.48 (i.e. by 3.48%). The figures shown in the table are only indicative and are intended to demonstrate how the price of a security can be affected by change in credit rating.

Rating Yield (% Market Value (Rs.) p.a.) AA 11.00 100.00 If upgraded to AAA 9.60 103.48 If downgraded to A 11.50 98.76 iv. Basis Risk:

During the life of floating rate security or a swap the underlying benchmark index may become less active and may not capture the actual movement in the interest rates or at times the benchmark may cease to exist. These types of events may result in loss of value in the portfolio. Where swaps are used to hedge an underlying fixed income security, basis risk could arise when the fixed income yield curve moves differently from that of the swap benchmark curve.

v. Spread Risk:

In a floating rate security the coupon is expressed in terms of a spread or mark up over the benchmark rate. However, depending upon the market conditions the spreads may move adversely or favourably leading to fluctuation in NAV.

vi. Reinvestment Risk:

Investments in fixed income securities may carry reinvestment risk as interest rates prevailing on the interest or maturity due dates may differ from the original coupon of the bond. Consequently, the proceeds may get invested at a lower rate.

vii. Liquidity Risk:

The corporate debt market is relatively illiquid vis-a- vis the government securities market. There could therefore be difficulties in exiting from corporate bonds in times of uncertainties. Liquidity in a scheme therefore may suffer. Even though the Government Securities market is more liquid 30compared to that of other debt instruments, on occasions, there could be difficulties in transacting in the market due to extreme volatility or unusual constriction in market volumes or on occasions when an unusually large transaction has to be put through. In view of this, redemption may be limited or suspended after approval from the Boards of Directors of the AMC and the Trustee, under certain circumstances as described elsewhere in the SAI.

3. Risk Associated with Investment in Derivatives Market Derivative products are leveraged instruments and can provide disproportionate gains as well as disproportionate losses to the investor. Execution of such strategies depends upon the ability of the fund manager to identify such opportunities. Identification and execution of the strategies to be pursued by the fund manager involve uncertainty and decision of fund manager may not always be profitable. No assurance can be given that the fund manager will be able to identify or execute such strategies.

< S.O 28> The risks associated with the use of derivatives are different from or possibly greater than, the risks associated with investing directly in securities and other traditional investment. < S.O 28> The Scheme may use derivative instruments such as index futures, stock futures, index options, stock options, warrants, convertible securities, swap agreements or any other derivative instruments that are permissible or may be permissible in future under applicable regulations, as would be commensurate with the investment objective of the Scheme The risks associated with the use of derivatives are different from or possibly greater than the risks associated with investing directly in securities and other traditional investments. There are certain risks inherent in aforesaid derivatives instruments. These are:

a) Basis Risk – This risk arises when the derivative instrument used to hedge the underlying asset does not match the movement of the underlying being hedged for e.g. mismatch between the maturity date of the futures and the actual selling date of the asset.

b) Limitations on upside: Derivatives when used as hedging tool can also limit the profits from a genuine investment transaction. c) Liquidity risk pertains to how saleable a security is in the market. All securities/instruments irrespective of whether they are equity, bonds or derivatives may be exposed to liquidity risk (when the sellers outnumber buyers) which may impact returns while exiting opportunities.

d) In case of investments in index futures, the risk would be the same as in the case of investments in a portfolio of shares representing an index. The extent of loss is the same as in the underlying stocks. In case futures are used for hedging a portfolio of stocks, which is different from the index stocks, the extent of loss could be more or less depending on the coefficient of variation of such portfolio with respect to the index; such coefficient is known as Beta.

e) The risk related to hedging for use of derivatives, (apart from the derivatives risk mentioned above) is that event of risk, which we were anticipating and hedged our position to mitigate it, does not happen. In such case, the cost incurred in hedging the position would be a avoidable charge to the scheme net assets.

f) Credit Risk – The credit risk in derivative transaction is the risk that the counter party will default on its obligations and is generally low, as there is no exchange of principal amounts in a IRS / IRF derivative transaction. With the phased implementation of physical settlement of stocks in equity 31derivative segment, though there is an element of risk of stock / funds not being received, the same is mitigated due to settlement guarantee similar to equity cash market segment.

g) Interest Rate Risk – interest rate is one of the variables while valuing derivatives such as futures & options. For example, with everything remaining constant, when interest rates increase, the price of Call option would increase. Thus, fluctuations in interest rates would result in volatility in the valuation of derivatives.

h) Model Risk - A variety of models can be used to value options. Hence, the risk to the scheme is that the fund manager buys a particular option using a particular valuation model (on the basis of which the option seems to be fairly priced or cheap) but the market is valuing it using another valuation model and according to which the option may be expensive.

i) The risk (loss) for an option buyer is limited to the premium paid, while the risk (loss) of an option writer is unlimited, the latter’s gain being limited to the premiums earned. However, in the case of the scheme, all option positions will have underlying assets and therefore all losses due to price- movement beyond the strike price will actually be an opportunity loss. The writer of a put option bears a risk of loss if the value of the underlying asset declines below the strike price. The writer of a call option bears a risk of loss if the value of the underlying asset increases above the strike price.

4. Risks associated with Covered Call Strategy: • The risk associated with a covered call is the loss of upside, i.e. If the underlying price rises above the strike, the short call loses its value as much as the underlying stock gains • The Scheme may write covered call option only in case it has adequate number of underlying equity shares as per regulatory requirement. This means to set aside a portion of investment in underlying equity shares. In case of change in view, the scheme may not be able to sell the underlying equity shares immediately, if covered call options are sold to the maximum extent allowed by regulatory authority.

• The covered call options need to be unwound before the stock positions can be liquidated. This may lead to a loss of opportunity, or can cause exit issues if the strike price at which the call option contracts have been written become illiquid. Hence, the scheme may not be able to sell the underlying equity shares, which can lead to temporary illiquidity of the underlying equity shares and result in loss of opportunity.

5. Risks associated with Securitised Debt:

The Scheme may from time to time invest in domestic securitised debt, for instance, in asset backed securities (ABS) or mortgage backed securities (MBS). Typically, investments in securitised debt carry credit risk (where credit losses in the underlying pool exceed credit enhancement provided, (if any) and the reinvestment risk (which is higher as compared to the normal corporate or sovereign debt). The underlying assets in securitised debt are receivables arising from automobile loans, personal loans, loans against consumer durables, loans backed by mortgage of residential / commercial properties, underlying single loans etc.

ABS/MBS instruments reflect the proportionate undivided beneficial interest in the pool of loans and do not represent the obligation of the issuer of ABS/MBS or the originator of the underlying receivables. Investments in securitised debt is largely guided by following factors:

32• Attractive yields i.e. where securitised papers offer better yields as compared to the other debt papers and also considering the risk profile of the securitised papers. • Diversification of the portfolio • Better performance

Broadly following types of loans are securitised: a) Auto Loans The underlying assets (cars etc.) are susceptible to depreciation in value whereas the loans are given at high loan to value ratios. Thus, after a few months, the value of asset becomes lower than the loan outstanding. The borrowers, therefore, may sometimes tend to default on loans and allow the vehicle to be repossessed.

These loans are also subject to model risk. i.e. if a particular automobile model does not become popular, loans given for financing that model have a much higher likelihood of turning bad. In such cases, loss on sale of repossession vehicles is higher than usual.

Commercial vehicle loans are susceptible to the cyclicality in the economy. In a downturn in economy, freight rates drop leading to higher defaults in commercial vehicle loans. Further, the second hand prices of these vehicles also decline in such economic environment.

b) Housing Loans Housing loans in India have shown very low default rates historically. However, in recent years, loans have been given at high loan to value ratios and to a much younger borrower classes. The loans have not yet gone through the full economic cycle and have not yet seen a period of declining property prices. Thus the performance of these housing loans is yet to be tested and it need not conform to the historical experience of low default rates.

c) Consumer Durable Loans • The underlying security for such loans is easily transferable without the bank's knowledge and hence repossession is difficult. • The underlying security for such loans is also susceptible to quick depreciation in value. This gives the borrowers a high incentive to default.

d) Personal Loans These are unsecured loans. In case of a default, the bank has no security to fall back on. The lender has no control over how the borrower has used the borrowed money.

Further, all the above categories of loans have the following common risks: • All the above loans are retail, relatively small value loans. There is a possibility that the borrower takes different loans using the same income proof and thus the income is not sufficient to meet the debt service obligations of all these loans.

• In India, there is no ready database available regarding past credit record of borrowers. Thus, loans may be given to borrowers with poor credit record. • In retail loans, the risks due to frauds are high.

e) Single Loan PTC A single loan PTC is a securitization transaction in which a loan given by an originator (Bank/ NBFC/ FI etc.) to a single entity (obligor) is converted into pass through certificates and sold to investors. The transaction involves the assignment of the loan and the underlying receivables by the originator to a trust, which funds the purchase by issuing PTCs to investors at the discounted value of the receivables.

33The PTCs are rated by a rating agency, which is based on the financial strength of the obligor alone, as the PTCs have no recourse to the originator.

The advantage of a single loan PTC is that the rating represents the credit risk of a single entity (the obligor) and is hence easy to understand and track over the tenure of the PTC. The primary risk is that of all securitized instruments, which are not traded as often in the secondary market and hence carry an illiquidity risk. The structure involves an assignment of the loan by the originator to the trustee who then has no interest in monitoring the credit quality of the originator. The originator that is most often a bank is in the best position to monitor the credit quality of the originator. The investor then has to rely on an external rating agency to monitor the PTC. Since the AMC relies on the documentation

provided by the originator, there is a risk to the extent of the underlying documentation between the seller and underlying borrower.

6. Risk associated with investment in Government securities and Tri-Party Repo on Government

securities or treasury bills:

The mutual fund is a member of securities segment and Triparty repo on Government securities or treasury bills trade settlement of the Clearing Corporation of India (CCIL). All transactions of the mutual fund in government securities and in Triparty repo on Government securities or treasury bills or trades are settled centrally through the infrastructure and settlement systems provided by CCIL; thus reducing the settlement and counter party risks considerably for transactions in the said segments.

The members are required to contribute towards margin obligation (Initial / Mark to Market etc.) as per bye-laws of CCIL as also an amount as communicated by CCIL from time to time to the default fund maintained by CCIL as a part of the default waterfall (a loss mitigating measure of CCIL in case of default by any member in discharging their obligation. As per the waterfall mechanism, after the defaulter’s margins and the defaulter’s contribution to the default fund have been appropriated, CCIL’s contribution is used to meet the losses. Post utilization of CCIL’s contribution if there is a residual loss, it is appropriated from the default fund contributions of the non-defaulting members as determined by CCIL.

Thus the scheme is subject to risk of the initial margin and default fund contribution being invoked in the event of failure of any settlement obligations. In addition, the mutual fund contribution is allowed to be used to meet the residual loss in case of default by the other clearing member (the defaulting member).

CCIL maintains two separate Default Funds in respect of its Securities Segment, one with a view to meet losses arising out of any default by its members from outright and repo trades and the other for meeting losses arising out of any default by its members from Triparty repo on Government securities or treasury bills trades. The mutual fund is exposed to the extent of its contribution to the default fund of CCIL, in the event that the contribution of the mutual fund is called upon to absorb settlement/ default losses of another member by CCIL, as a result the scheme may lose an amount equivalent to its contribution to the default fund.

7. Risk envisaged and mitigation measures for repo transactions:

Credit risks could arise if the counterparty does not return the security as contracted or interest received by the counter party on due date. This risk is largely mitigated, as the choice of counterparties is largely restricted and their credit rating is taken into account before entering into such transactions. Additionally, appropriate haircuts are applied on the market value of the underlying securities based on the tenor and illiquidity of the underlying security Also operational risks are lower as such trades are settled on a DVP basis.

In the event of the scheme being unable to pay back the money to the counterparty as contracted, the counter 34party may dispose of the assets (as they have sufficient margin) and the net proceeds may be refunded to us.

Thus the scheme may in remote cases suffer losses. This risk is normally mitigated by better cash flow planning to take care of such repayments.

The above risks will not arise for repo transactions where settlement is guaranteed by a Clearing Corporation.

8. Risks associated with Investing in Structured Obligation (SO) & Credit Enhancement (CE) rated

securities:

The risks factors stated below for the Structured Obligations & Credit Enhancement are in addition to the risk factors associated with debt instruments. • Credit rating agencies assign CE rating to an instrument based on any identifiable credit enhancement for the debt instrument issued by an issuer. The credit enhancement could be in various forms such as guarantee, shortfall undertaking, letter of comfort, pledge of shares listed on stock exchanges etc. from the issuers, promoters or another entity. This entity could be either related or non-related to the issuer like a bank, financial institution, etc. Hence, for CE rated instruments evaluation of the credit enhancement provider, as well as the issuer is undertaken to determine the issuer rating.

• SO transactions are asset backed/ mortgage backed securities, securitized paper backed by hypothecation of loan receivables, securities backed by trade receivables, credit card receivables etc. In case of SO rated issuer, the underlying loan pools or securitization, etc. is assessed to arrive at rating for the issuer.

• Liquidity Risk: SO rated securities are often complex structures, with a variety of credit enhancements. Debt securities lack a well-developed secondary market in India, and due to the credit enhanced nature of CE securities as well as structured nature of SO securities, the liquidity in the market for these instruments is low as compared to similar rated debt instruments. Hence, lower liquidity of such instruments, could lead to inability of the scheme to sell such debt instruments and generate liquidity for the scheme or higher impact cost when such instruments are sold. Where equity shares are provided as collateral there is the risk of sharp price volatility of underlying securities which may lead to erosion in value of collateral as also low liquidity of the underlying shares which may affect the ability of the scheme to enforce collateral and recover capital and interest obligations.

• Credit Risk: The credit risk of debt instruments which are CE rated derives rating based on the combined strength of the issuer as well as the structure. Hence, any weakness in either the issuer or the structure could have an adverse credit impact on the debt instrument. The weakness in structure could arise due to inability of the investors to enforce the structure due to issues such as legal risk, inability to sell the underlying collateral or enforce guarantee, etc. In case of SO transactions, comingling risk and risk of servicer increases the overall risk for the securitized debt or assets backed transactions. Therefore, apart from issuer level credit risk such debt instruments are also susceptible to structure related credit risk.

9. Risk factors associated with REITS/InvITs: • Market Risk – Units of REITS & InvITs are subject to market and other risks. The value of these units can go up or down because of various factors that affect the capital market in general, such as, but not limited to, changes in interest rates, government policy and volatility in the capital markets • Liquidity Risk - Liquidity in units of REITs & InvITs may be affected by trading volumes, settlement periods and transfer procedures. These factors may also affect the Scheme’s ability to make intended purchases/sales, cause potential losses to the Scheme and result in the Scheme missing certain investment opportunities. These factors can also affect the time taken by Kotak Mahindra Mutual Fund for redemption of Units, which could be significant in the event of receipt of a very large number of redemption requests 35or very large value redemption requests. In view of this, redemption may be limited or suspended after approval from the Boards of Directors of the AMC and the Trustee, under certain circumstances as described in the Statement of Additional Information. REITs and InvITs currently only have a nascent primary market. As such, in absence of the secondary market, the invested units cannot be redeemed except where the issuer is offering a buyback or delisting the units.

• Re-investment Risk – Investments in REITs & InvITs may carry reinvestment risk as there could be repatriation of funds by the Trusts in form of distribution of dividend, interest etc. Consequently, the proceeds may get invested at a lower rate • Performance Risk - InvITs and REITS carry a performance risk by way of repayment of principal or of interest by the borrower. REITs & InvITs are likely to have volatile cash flows as the repayment dates would not necessarily be pre scheduled.

The above are some of the common risks associated with investments in REITs & InvITs. There can be no assurance that a Scheme's investment objectives will be achieved, or that there will be no loss of capital.

10. Risk Factors Associated with investing in Foreign Securities: < S.O 11> Subject to necessary approvals and within the investment objectives of the Scheme, the Scheme may invest in overseas markets which carry risks related to fluctuations in the foreign exchange rates, the nature of the securities market of the country, repatriation of capital due to exchange controls and political circumstances.

However, in case the overall industry limit or such other limit as prescribed by SEBI has been breached, the Scheme may not in a position to invest in foreign securities temporarily.

To manage risks associated with foreign currency and interest rate exposure, the Scheme may use derivatives for efficient portfolio management including hedging and in accordance with conditions as may be stipulated under the Regulations or by the RBI from time to time.

Overseas investments will be made subject to any/all approvals, conditions thereof as may be stipulated under the Regulations or by RBI and provided such investments do not result in expenses to the Scheme in excess of the ceiling on expenses prescribed by and consistent with costs and expenses attendant to international investing.

The Mutual Fund may, where necessary, appoint other intermediaries of repute as advisors, custodian/sub- custodians etc. for managing and administering such investments. The appointment of such intermediaries shall be in accordance with the applicable requirements of SEBI and within the permissible ceilings of expenses. The fees and expenses would illustratively include, besides the investment management fees, custody fees and costs, fees of appointed advisors and sub-managers, transaction costs and overseas regulatory costs.

To the extent that the assets of the Scheme will be invested in securities denominated in foreign currencies, the Indian Rupee equivalent of the net assets, distributions and income may be adversely affected by changes in the value of certain foreign currencies relative to the Indian Rupee. The repatriation of capital to India may also be hampered by changes in regulations concerning exchange controls or political circumstances as well as the application to it of other restrictions on investment.

Currency Risk:

Investments in overseas securities/mutual fund units are subject to currency risk. Returns to investors are the result of a combination of returns from investments and from movements in exchange rates. For example, if the Rupee appreciates vis-à-vis the US $, the extent of appreciation will lead to reduction in the yield to the investor. However, if the Rupee appreciates against the US $ by an amount in excess of the interest earned on the investment, the returns can even be negative. Again, in case the Rupee depreciates vis-à-vis the US $, 36the extent of depreciation will lead to a corresponding increase in the yield to the investor. Going forward, the Rupee may depreciate (lose value) or appreciate (increase value) against the currencies of the countries where the Scheme will invest.

Exhaustion of overseas limit Risk The Scheme can make overseas investments subject to a maximum of US $ 1 billion per Mutual Fund, within the overall industry limit of US $ 7 billion or such limits as may be prescribed by SEBI/RBI from time to time. The Scheme therefore may or may not be able to utilise the limit of USD 1 billion due to the USD 7 billion limit being exhausted by other Mutual Funds. Further, the scheme can make investments in overseas Exchange Traded Fund (ETF(s) subject to a maximum of US $ 300 million per Mutual Fund, within the overall industry limit of US $ 1 billion.

As and when the investment limits at Mutual Fund level/Industry level are exhausted or nearing exhaustion, the scheme may temporarily suspend deployment of funds in overseas funds/securities.

11. Risk associated with Securities Lending:

In the case of securities lending, there is a possibility of recall of securities lent at a higher premium than at which the security is lent or unable to recall due to low volume. Additional risk on securities lending is that there can be temporary illiquidity of the securities that are lent out and the Fund may not be able to sell such lent-out securities, resulting in an opportunity loss. In case of a default by counterparty, the loss to the Fund can be equivalent to the securities lent.

12. Risks associated with segregated portfolio • Investor holding units of segregated portfolio may not able to liquidate their holding till the time realisable value is recovered. • Security comprising of segregated portfolio may realise lower value or may realise zero value.

• Listing of units of segregated portfolio in recognised stock exchange does not necessarily guarantee their liquidity. There may not be active trading of units in the stock market. Further trading price of units on the stock market may be significantly lower than the prevailing NAV.

13. Risk associated with investing in Units of Mutual Fund Schemes Investment in units of Mutual Fund scheme involves investment risks such as trading volumes, settlement risk, liquidity risk, default risk including the possible loss of principal. As the price / value / interest rates of the underlying securities in which the mutual fund scheme invests fluctuates, the value of units of mutual fund scheme may go up or down. The value of underlying securities may be affected, inter-alia, by changes in the market, interest rates, changes in credit rating, trading volumes, settlement periods and transfer procedures; the NAV is also exposed to Price/Interest-Rate Risk and Credit Risk and may be affected inter- alia, by government policy, volatility and liquidity in the money markets and pressure on the exchange rate of the rupee. Investment in units of mutual fund scheme is also exposed to risk of suspension of subscriptions / redemptions of the units, change in fundamental attributes application of swing pricing, Segregation of portfolios etc. Swing pricing / segregation of portfolios risks may amongst things realise lower and/or nil value on redemption of underlying units. Since the Scheme may invest in schemes of Mutual Funds, scheme specific risk factors of each such mutual fund schemes will be applicable to the Scheme portfolio.

C. Risk mitigation strategies < S.O 9> Type of Risks Measures/ Strategies to control risks Equity Investment strategy Markets/ The scheme will comply with the prescribed SEBI limits on exposure. Risk is Equity monitored and necessary action would be taken on the portfolio, if required.

37Oriented Attribution analysis is done to monitor the under or over performance vis-a-vis the Instruments benchmark and the reasons for the same.

Portfolio volatility & concentration The overall volatility of the portfolio would be maintained in line with the objective of the scheme Volatility would be monitored with respect to the benchmark and peer set.

Liquidity The scheme predominantly invests across market capitalisation which are actively traded and thereby liquid. The fund manager may also keep some portion of the portfolio in debt and money market instruments and/or cash within the specified asset allocation framework for the purpose of meeting redemptions. The liquidity would be monitored and necessary action would be taken on the portfolio if required. Stock turnover is monitored at regular intervals. Also the fund manager may deploy the assets in debt/money market instruments with a short-term duration, which can provide liquidity to the portfolio.

Debt and • Credit Risk: Management analysis will be used for identifying company specific Money Market risks. Management’s past track record will also be studied. In order to assess instruments financial risk a detailed assessment of the issuer’s financial statements will be undertaken.

• Price-Risk or Interest-Rate Risk: The Scheme may primarily invest the debt portion of the portfolio in short term debt & money market instruments, units of Liquid and Overnight schemes thereby mitigating the price volatility due to interest rate changes generally associated with long-term securities.

• Risk of Rating Migration: The Scheme may primarily invest the debt portion of the portfolio in short-term debt & money market instruments, units of Liquid and Overnight schemes thereby mitigating the risk of rating migration generally associated with long-term securities • Basis Risk: The debt allocation of scheme is primarily as a cash management strategy and such strategy returns are expected to reflect the very short term interest rate hence investment is done in short term debt and money market instruments.

• Spread Risk: The Scheme may primarily invest the debt portion of the portfolio in short-term debt & money market instruments, units of Liquid and Overnight schemes thereby mitigating the risk of spread expansion which is generally associated with long-term securities • Reinvestment Risk: The debt allocation of scheme is primarily as a cash management strategy and such strategy returns are expected to reflect the very short term interest rate hence investment is done in short term debt and money market instruments. Reinvestment risks will be limited to the extent of debt instruments, which will be a very small portion of the overall portfolio value.

• Liquidity Risk: The Scheme may, however, endeavor to minimize liquidity risk by primarily investing the debt portion of the portfolio in relatively liquid short- term debt & money market instruments, units of Liquid and Overnight schemes.

38Derivatives The Scheme may invest in derivative for the purpose of hedging, portfolio balancing and other purposes as may be permitted under the Regulations. Equity Derivatives will be used in the form of Index Options, Index Futures, Stock Options and Stock Futures and other instruments as may be permitted by SEBI.

Derivatives can be either exchange traded or can be over the counter (OTC).

Exchange traded derivatives are listed and traded on stock exchanges whereas OTC derivative transactions are generally structured between two counterparties.

Exposure with respect to derivatives shall be in line with regulatory limits and the limits specified in the SID.

Currency The scheme subject to applicable regulations shall have the option to enter into forward contracts for the purposes of hedging against the foreign exchange fluctuations. The Schemes may employ various measures (as permitted by SEBI/RBI) including but not restricted to currency hedging (such as currency options and forward currency exchange contracts, currency futures, written call options and purchased put options on currencies and currency swaps), to manage foreign exchange movements arising out of investment in foreign securities.

All currency derivatives trade, if any will be done only through the stock exchange platform.

Repo This risk is largely mitigated, as the choice of counterparties is largely restricted Transactions and their credit rating is taken into account before entering into such transactions.

Also operational risks are lower as such trades are settled on a DVP basis. In the event the counterparty is unable to pay back the money to the scheme as contracted on maturity, the scheme may dispose of the assets (as they have sufficient margin) and the net proceeds may be refunded to the counterparty Securitized In addition to careful scrutiny of credit profile of borrower/pool additional security Debt in the form of adequate cash collaterals and other securities may be obtained Segregated In such an eventuality it will be AMC’s endeavor to realise the segregated holding Portfolio in the best interest of the investor at the earliest.

Units of REITs The Scheme will comply with the prescribed SEBI limits on exposure. The and InvITS scheme will endeavour to invest in liquid REITs & InvITs.

Structured Scheme wise investments as prescribed by the regulations limits the exposure to Obligation (SO) such securities. Additionally, covenants of such structured papers are reviewed & Credit periodically for adequate maintenance of covers as prescribed in the Information Enhancement Memorandum of such papers.

(CE) rated securities Government As a member of securities segment and Triparty repo segment, maintenance of securities and sufficient margin is a mandatory requirement. CCIL monitors these on a real time Triparty repo basis and requests the participants to provide sufficient margin to enable the trades on etc. Also there are stringent conditions / requirements before registering any Government participants by CCIL in these segments. Since settlement is guaranteed the loss on securities or this account could be minimal though there could be an opportunity loss.

treasury bills:

Units of Mutual Fund portfolios are generally well diversified and typically endeavor to mutual fund provide liquidly on a T+1/T+2 basis. schemes While these measures are expected to mitigate the above risks to a large extent, there can be no assurance that these risks would be completely eliminated.

39The measures mention above is based on current market conditions and may change from time to time based on changes in such conditions, regulatory changes and other relevant factors. Accordingly, our investment strategy, risk mitigation measures and other information contained herein may change.in response to the same.

II. INFORMATION ABOUT THE SCHEME:

A. Where will the scheme invest Securities/ Instruments Definitions Equity and equity related securities Equity shares is a security that represents ownership interest in a including convertible bonds and company.

debentures and warrants carrying the Equity related instruments include convertible debentures, right to obtain equity shares; convertible preference shares, warrants carrying the right to obtain equity shares, equity derivatives and such other instrument as may be specified by the Board from time to time.

Derivative is a financial instrument whose value is based upon the value of an underlying equity shares or indices. The equity

derivatives may be in the following form:

Futures - Futures Contract means a legally binding agreement to buy or sell the underlying security / indices on a future date at an agreed price.

Options - Options Contract is a type of Derivatives Contract which gives the buyer/holder of the contract the right (but not the obligation) to buy/sell the underlying asset at a predetermined price within or at end of a specified period. The buyer / holder of the option purchases the right from the seller/writer for a consideration which is called the premium. The seller/writer of an option is obligated to settle the option as per the terms of the contract when the buyer/holder exercises his right. The underlying asset could include securities, an index of prices of securities etc.

Securities created and issued by the Government Security (G-Sec) is a tradeable instrument issued by Central and State Governments and/or the Central Government or the State Governments. It repos/reverse repos in such Government acknowledges the Government’s debt obligation. They are Securities as may be permitted by RBI generally long term with maturity of one year or more. In India, (including but not limited to coupon the Central Government issues both, treasury bills and bonds or bearing bonds, zero coupon bonds and dated securities while the State Governments issue only bonds or treasury bills) dated securities, which are called the State Development Loans

(SDLs). G-Secs carry practically no risk of default and, hence, are called risk-free gilt-edged instruments.

Repos / Reverse Repos enables collateralized short term borrowing and lending through sale/purchase operations in the such government securities.

Debt obligations of domestic These are instruments issued by various government agencies and Government agencies and statutory bodies (including but not limited to Indian Government Bond, bodies, which may or may not carry a State Development Loans issued and serviced at the Public Debt Central/State Government guarantee Office, Bonds issued by Central & State Government PSU’s (including but not limited to Indian which are guaranteed by Central or State Governments. They can Government Bond, State Development be issued at discount, par or premium.

40Loans issued and serviced at the Public Debt Office, Bonds issued by Central & State Government PSU’s which are guaranteed by Central or State Governments);

Corporate debt (of both public and These are financial instruments issued by companies (both public private sector undertakings) including and private) to raise long-term funds through public issues. They Nonconvertible debentures (including are generally rated by credit rating agencies.

bonds) and non-convertible part of convertible securities;

Short Term Deposits of banks (both Short Term Deposits are offered by Scheduled Commercial Banks public and private sector) and (both public and private sector banks) with a fixed/floating development financial institutions to the interest rate and maturity date.

extent permissible under SEBI Regulations;

Money market instruments permitted by • “Certificate of Deposit” or “CD” is issued by Scheduled SEBI/RBI, having maturities of up to one Commercial Banks (SCBs) and All-India Financial

year but not limited to: • Certificate of Institutions. There is a term period of 7 days to 1 year for CDs Deposits (CDs). • Commercial Paper that are issued by SCBs, whereas the term period ranges from

(CPs) • Tri-party Repo, Bills re- 1 year to 3 years for CDs issued by financial institutions. CDs discounting, as may be permitted by are usually issued at a discounted rate and redeemed at par.

SEBI from time to time. • Repo of corporate debt securities • "Commercial Paper" or "CP" is a short-term instrument issued by corporates and financial institutions CPs are usually issued at a discounted rate and redeemed at par. The tenor of CP ranges from 7 days to 1 year.

• Treasury bills or T-bills, which are money market instruments, are short term debt instruments issued by the Government of India and are presently issued in three tenors, namely, 91 day, 182 day and 364 day. Treasury bills are zero coupon securities and pay no interest. Instead, they are issued at a discount and redeemed at the face value at maturity.

• Triparty Repo (TREPS) is a type of repo contract where a third entity (apart from the borrower and lender), called a Tri- Party Agent, acts as an intermediary between the two parties to the repo to facilitate services like collateral selection, payment and settlement, custody and management during the life of the transaction.

• Repos / Reverse Repos enables collateralized short term borrowing and lending through sale/purchase operations in debt instruments (including corporate bonds). • Bills Re-discounting is an instrument where a financial institution discounts the bills of exchange that it has discounted previously with another financial institution.

Securitised Debt Securitised Debt are debt instruments with rights over assets backed by cash flows.

Units of Mutual Funds Schemes Mutual fund means a fund established in the form of a trust to 41raise monies through the sale of units to the public or a section of the public under one or more schemes for investing in securities, money market instruments, gold or gold related instruments, silver or silver related instruments, real estate assets and such other assets and instruments as may be specified by the SEBI from

time to time:

The scheme may invest in units of Overseas securities refer to securities (viz. mutual funds, ETFs, overseas Mutual Funds schemes / ETFs, ADRs / GDRs, stocks) that are listed or traded in any jurisdiction ADRs, GDRs or other foreign securities outside India.

Securities Lending & Borrowing as Securities Lending and Borrowing is a process through which permitted by SEBI from time to time shares or stocks are lent or borrowed from other investors or financial firms at a specified time and price Investment in units of Real Estate “REIT” or “Real Estate Investment Trust” means a person that Investment Trust (‘REIT’) & pools rupees fifty crores or more for the purpose of issuing units Infrastructure Investment Trust (‘InvIT’) to at least two hundred investors so as to acquire and manage real estate asset(s) or property(ies), that would entitle such investors to receive the income generated therefrom without giving them the day-to-day control over the management and operation of such real estate asset(s) or property(ies).

“InvIT” or 'Infrastructure Investment Trust' shall mean the trust registered as such under the Securities and Exchange Board of India (Infrastructure Investment Trusts) Regulations, 2014.An Infrastructure Investment Trust (InvITs) is Collective Investment Scheme which enables direct investment of money from individual and institutional investors in infrastructure projects.

Investment in debt instruments having Structured Obligation '(SO)' refers to ratings of securitisation structured obligations / credit transactions to indicate 'structured obligation', where the credit enhancements rating on an instrument can be enhanced over and above the issuer rating by means of a structure or mechanism. 'SO' ratings apply only to instruments, and not to the companies issuing them.

Credit Enhancement 'CE' refers to suffix for instruments having credit enhancement that is external (or from third party) like guarantees or partial guarantees. However, the ‘CE’ suffix will be applied only if the credit enhancement mechanism results in a credit uplift for the instrument, over and above the unsupported rating of the issuer.

Transfer of investments from one scheme to another scheme in the same Mutual Fund, shall be allowed, in lines with Para 12.30 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024.

INVESTMENT IN FOREIGN SECURITIES The Scheme may, in terms of its investment objectives with the approval of SEBI/RBI invest in following

Foreign Securities: i. ADRs/ GDRs issued by Indian or foreign companies ii. Equity of overseas companies listed on recognized stock exchanges overseas iii. Initial and follow on public offerings for listing at recognized stock exchanges overseas iv. Foreign debt securities in the countries with fully convertible currencies, short term as well as long term 42debt instruments with rating not below investment grade by accredited/registered credit rating agencies v. Money market instruments rated not below investment grade vi. Repos in the form of investment, where the counterparty is rated not below investment grade; repos should not however, involve any borrowing of funds by mutual funds vii. Government securities where the countries are rated not below investment grade viii. Derivatives traded on recognized stock exchanges overseas only for hedging and portfolio balancing with underlying as securities ix. Short term deposits with banks overseas where the issuer is rated not below investment grade x. Units/securities issued by overseas mutual funds or unit trusts registered with overseas regulators and investing in

(a) aforesaid securities,

(b) Real Estate Investment Trusts (REITs) listed in recognized stock exchanges overseas or

(c) unlisted overseas securities (not exceeding 10% of their net assets).

The Scheme can invest in overseas securities subject to a maximum of US $1 billion within the overall industry limit of US $ 7 billion wherein US $ 50 million would be reserved for each mutual fund individually, with in the overall industry limit of US $ 7 billion or such limits as may be prescribed by SEBI from time to time and in overseas ETF subject to maximum of US $300 million such limits as may be prescribed by SEBI from time to time. An investment headroom of 20% of the average AUM in Overseas securities of the previous three calendar months would be available to the Mutual Fund for that month to invest in Overseas securities / Overseas ETFs subject to maximum limits of US $ 1 billion per Mutual Fund During the NFO, the intended amount for investment in overseas securities is US $ 5 Million subject to maximum limit as specified in para 12.19 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024.

The aforesaid investments would be in line with the asset allocation of the scheme.

The Mutual Fund may, where necessary appoint intermediaries as sub-managers, sub-custodians, etc. for managing and administering such investments. The appointment of such intermediaries shall be in accordance with the applicable requirements of SEBI and within the permissible ceilings of expenses as stated under Regulation 52 of SEBI (MF) Regulations.

B. What are the investment restrictions? As per the Trust Deed read with the SEBI (MF) Regulations, the following investment restrictions apply in respect of the Scheme at the time of making investments.

1. The Scheme shall not invest more than 10% of its NAV in the equity shares or equity related instruments of any company.

Provided that, the limit of 10% shall not be applicable for investments in case of index fund or exchange traded fund or sector or industry specific scheme including thematic fund.

2. All investments by a mutual fund scheme in equity shares and equity related instruments shall only be made provided such securities are listed or to be listed.

3. The Mutual Fund under all its Scheme(s) shall not own more than 10% of any company’s paid up capital carrying voting rights.

Provided, investment in the asset management company or the trustee company of a mutual fund shall be governed by clause (a), of sub-regulation (1), of regulation 7B.

434. As per Clause 1 of the Seventh Schedule of MF Regulation, the Scheme shall not invest more than 10% of its NAV in debt instruments comprising money market instruments and non-money market instruments issued by a single issuer which are rated not below investment grade by a credit rating agency authorised to carry out such activity under the Act. Such investment limit may be extended to 12% of the NAV of the scheme with the prior approval of the Board of Trustees and the Board of directors of the asset management company.

Within the limits specified in clause 1 of the Seventh Schedule of MF Regulation, a mutual fund scheme

shall not invest more than: a. 10% of its NAV in debt and money market securities rated AAA issued by a single issuer; or b. 8% of its NAV in debt and money market securities rated AA issued by a single issuer; or c. 6% of its NAV in debt and money market securities rated A and below issued by a single issuer.

The above investment limits may be extended by up to 2% of the NAV of the scheme with prior approval of the Board of Trustees and Board of Directors of the AMC, subject to compliance with the overall 12% limit specified in clause 1 of the Seventh Schedule of MF Regulation.

The long term rating of issuers shall be considered for the money market instruments. However, if there is no long term rating available for the same issuer, then based on credit rating mapping of Credit Rating Agency

(CRAs) between short term and long term ratings, the most conservative long term rating shall be taken for a given short term rating

Provided that such limit shall not be applicable for investments in Government Securities, treasury bills and tri-party repo on Government securities or treasury bills.

Provided further that investments within such limit can be made in mortgaged backed securitised debt which are rated not below investment grade by a credit rating agency registered with the Board.

Provided further that such limit shall not be applicable for investments in case of debt exchange traded funds or such other funds as may be specified by the Board from time to time.

5. The investment of the Scheme in the following instruments as per para 12.3 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024. shall not exceed 10% of the debt portfolio of the Scheme and the group exposure in such instruments shall not exceed 5% of the debt

portfolio of the Scheme: • Unsupported rating of debt instruments (i.e. without factoring-in credit enhancements) is below investment grade; and – • Supported rating of debt instruments (i.e. after factoring-in credit enhancement) is above investment grade The above limits shall not be applicable on investments in securitized debt instruments.

Investment by the Scheme in debt instruments, having credit enhancements backed by equity shares directly or indirectly, shall have a minimum cover of 4 times considering the market value of such shares.

Further, the investment in debt instruments having credit enhancements should be sufficiently covered to address the market volatility and reduce the inefficiencies of invoking of the pledge or cover, whenever required, without impacting the interest of the investors. In case of fall in the value of the cover below the specified limit, AMCs will initiate necessary steps to ensure protection of the interest of the investors.

446. Debentures, irrespective of any residual maturity period (above or below one year), shall attract the investment restrictions as applicable for debt instruments. It is further clarified that the investment limits are applicable to all debt securities, which are issued by public bodies/institutions such as electricity boards, municipal corporations, state transport corporations etc. guaranteed by either state or central government. Government securities issued by central/state government or on its behalf by the RBI are exempt from the above investment limits.

7. The Scheme may invest in another scheme under the same AMC or any other mutual fund without charging any fees, provided that aggregate inter-scheme investment made by all schemes under the same AMC or in schemes under the management of any other asset management shall not exceed 5% of the net asset value of the Mutual Fund. However, the aforesaid provision will not apply to fund of funds scheme.

8. The Scheme shall not make any investments in:

(a) any unlisted security of an associate or group company of the Sponsors; or

(b) any security issued by way of private placement by an associate or group company of the Sponsors; or

(c) the listed securities of group companies of the Sponsors which is in excess of 25% of the net assets.

9. The Scheme shall not invest in any Fund of Funds Scheme.

10. Transfer of investments from one scheme to another scheme in the same Mutual Fund, shall be allowed

only if:-

(a) such transfers are made at the prevailing market price for quoted Securities on spot basis (spot basis shall have the same meaning as specified by Stock Exchange for spot transactions.)

(b) the securities so transferred shall be in conformity with the investment objective of the scheme to which such transfer has been made. c) the same are in line with Para 12.30 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024.

11. The Mutual Fund shall buy and sell securities on the basis of deliveries and shall in all cases of purchases, take delivery of relevant securities and in all cases of sale, deliver the securities: • Provided that the Mutual Fund may engage in short selling of securities in accordance with the framework relating to short selling and securities lending and borrowing specified by SEBI.

• Provided further that the Mutual Fund may enter into derivatives transactions in a recognized stock exchange, subject to the framework specified by SEBI. • Provided further that sale of government security already contracted for purchase shall be permitted in accordance with the guidelines issued by the Reserve Bank of India in this regard.

12. No loans for any purpose may be advanced by the Mutual Fund and the Mutual Fund shall not borrow except to meet temporary liquidity needs of the Schemes for the purpose of payment of interest or Reinvestment of Income Distribution cum capital withdrawal option (IDCW) to Unit Holders, provided that the Mutual Fund shall not borrow more than 20% of the net assets of each of the Schemes and the duration of such borrowing shall not exceed a period of six months.

13. The Mutual Fund shall enter into transactions relating to Government Securities only in Electronic form.

14. The mutual fund shall get the securities purchased / transferred in the name of the mutual fund on account of the concerned scheme, where investments are intended to be of long term nature.

15. Pending deployment of funds of a scheme in terms of investment objectives of the scheme, a mutual fund may invest them in short term deposits of schedule commercial banks, subject to Para 12.16 and

4.5 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, as 45may be amended from time to time. The AMC shall not charge any investment management and advisory fees for parking of funds in such short term deposits of scheduled commercial banks for the scheme.

16. In accordance with the Para 12.1 SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, investments in following instruments as specified in the said circular, as may be amended from time to time, shall be applicable:

i. The scheme shall not invest in unlisted debt instruments including commercial papers (CPs), other than

(a) government securities, (b) other money market instrument and (c) derivative products such as Interest Rate Swaps (IRS), Interest Rate Futures (IRF), etc. which are used by mutual funds for hedging.

However, the scheme may invest in unlisted Non-Convertible Debentures (NCDs) not exceeding 10% of the debt portfolio of the scheme subject to the condition that such unlisted NCDs have a simple structure (i.e. with fixed and uniform coupon, fixed maturity period, without any options, fully paid up upfront, without any credit enhancements or structured obligations) and are rated and secured with coupon payment frequency on monthly basis.

ii. All fresh investments by mutual fund schemes in CPs would be made only in CPs which are listed or to be listed. iii. Further, investment in unrated debt and money market instruments, other than government securities, treasury bills, derivative products such as Interest Rate Swaps (IRS), Interest Rate Futures (IRF), etc.

by mutual fund schemes shall be subject to the conditions as specified in the said circular: a. Investments should only be made in such instruments, including bills re-discounting, usance bills, etc., that are generally not rated and for which separate investment norms or limits are not provided in SEBI (Mutual Fund) Regulations, 1996 and various circulars issued thereunder.

b. Exposure of mutual fund schemes in such instruments shall not exceed 5% of the net assets of the schemes. c. All such investments shall be made with the prior approval of the Board of AMC and the Board of Trustees.

iv. Investments in debt instruments, listed debt instruments shall include listed and to be listed debt instruments

17. Investments in Derivatives shall be in accordance with the guidelines as stated under Para 7.5, xand

12.25 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 as may be amended from time to time.

18. Investment restrictions w.r.t. REITs and InvITS: a) The Mutual Fund under all its schemes shall not own more than 10% of units issued by a single issuer of REIT and InvIT. b) The Scheme shall not invest more than 10% of its NAV in the units of REITs and InvITs.

c) The Scheme shall not invest more than 5% of its NAV in the units of REITs and InvITs issued by a single issuer.

19. Pursuant to SEBI circular SEBI/HO/IMD/PoD2/P/CIR/2025/92 dated June 26, 2025 various prudential limits issued under SEBI (Mutual Funds) Regulations, 1996 and circulars issued thereunder, shall be rebalanced basis the timelines provided in paragraph 2.9 of SEBI Master circular SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024.

46The AMC may alter these above stated restrictions from time to time to the extent the SEBI (MF) Regulations change, so as to permit the Scheme to make its investments in the full spectrum of permitted investments for mutual funds to achieve its respective investment objective. The Trustee may from time to time alter these restrictions in conformity with the SEBI (MF) Regulations.

All investment restrictions shall be applicable at the time of making investment.

Apart from the above investment restrictions, the Scheme follows certain internal norms vis-à-vis limiting exposure to scrips, sectors etc, within the above mentioned restrictions, and these are subject to review from time to time.

Modifications, if any, in the Investment Restrictions on account of amendments to the Regulations shall supercede /override the provisions of the Trust Deed.

Participation of scheme of Kotak Mahindra Mutual Fund in repo of corporate debt securities:

In accordance with Para 12.18 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, SEBI circular No. SEBI/HO/IMD/IMD PoD-2/P/CIR/2023/85 dated June 08, 2023 and SEBI circular No. SEBI/HO/IMD/IMD PoD-2/P/CIR/2023/87 dated June 13, 2023 and any other circulars issued by SEBI/ RBI from time to time, the Scheme shall participate in repo transactions on corporate debt securities including Commercial Papers (CPs) and Certificate of Deposits (CDs) in accordance with directions issued by RBI and SEBI from time to time. Currently the applicable guidelines

are as under: • The gross exposure of any mutual fund scheme to repo transactions in corporate debt securities including Commercial Papers (CPs) and Certificate of Deposits (CDs) shall not be more than 10 % of the net assets of the concerned scheme.

• The cumulative gross exposure through repo transactions in corporate debt securities including Commercial Papers (CPs) and Certificate of Deposits (CDs) along with equity, debt and derivatives, other permitted securities/assets and such other securities/assets as may be permitted by the Board from time to time shall not exceed 100% of the net assets of the concerned scheme.

• Mutual funds shall participate in repo transactions on following Corporate Debt securities; o listed AA and above rated corporate debt securities and o Commercial Papers(CPs) and Certificate of Deposits(CDs).

• In terms of Regulation 44 (2) mutual funds shall borrow through repo transactions only if the tenor of the transaction does not exceed a period of six months. • Mutual funds shall ensure compliance with the Seventh Schedule of the Mutual Funds Regulations about restrictions on investments, wherever applicable, with respect to repo transactions in corporate debt securities including Commercial Papers(CPs) and Certificate of Deposits(CDs). However, for transactions where settlement is guaranteed by a Clearing Corporation, the exposure shall not be considered for the purpose of determination of investment limits for single issuer, group issuer and sector level limits.

The parameters for investment in repos of corporate debt securities as approved by the Board of

AMC and Trustee Company are as under: i) Category of counterparty to be considered for making investment:

All entities (including clearing corporations) eligible for transacting in corporate bond repos as defined by SEBI and RBI shall be considered for repo transactions.

(ii) Credit rating of counterparty to be considered for making investment The schemes shall participate in corporate bond repo transactions with counterparties having a minimum investment grade rating and is approved by the Investment Committee on a case-to-case basis. In case 47there is no rating available, the Investment Committee will decide the rating of the counterparty, and report the same to the Board from time to time.

The requirement for credit rating of the counterparty will not be applicable for transactions where settlement is guaranteed by a Clearing Corporation,

(iii) Tenor of Repo and collateral As a repo seller, the schemes will borrow cash for a period not exceeding 6 months or as per extant regulations. As a repo buyer, the Schemes are allowed to undertake the transactions for maximum maturity upto one year or such other terms as may be approved by the Investment Committee. There shall be no restriction / limitation on the tenor of collateral.

(iv) Applicable haircuts RBI in its circular dated July 24, 2018 has prescribed the haircut to be applied for repo transactions as

follows:

Haircut/margins will be decided either by the clearing house or may be bilaterally agreed upon, in terms of the documentation governing repo transactions, subject to the following stipulations: i. Listed corporate bonds and debentures shall carry a minimum haircut of 2% of market value.

ii. CPs and CDs shall carry a minimum haircut of 1.5% of market value. iii. Securities issued by a local authority shall carry a minimum haircut of 2% of market value.

However, the fund manager may ask for a higher haircut (while lending) or give a higher haircut (while borrowing) depending on the prevailing liquidity situation in the market.

Risk envisaged and mitigation measures for repo transactions:

Credit risks could arise if the counterparty does not return the security as contracted or interest received by the counter party on due date. This risk is largely mitigated, as the choice of counterparties is largely restricted and their credit rating is taken into account before entering into such transactions. Also operational risks are lower as such trades are settled on a DVP basis.

In the event of the scheme being unable to pay back the money to the counterparty as contracted, the counter party may dispose of the assets (as they have sufficient margin) and the net proceeds may be refunded to us. Thus the scheme may in remote cases suffer losses. This risk is normally mitigated by better cash flow planning to take care of such repayments.

The above risks will not arise for repo transactions where settlement is guaranteed by a Clearing Corporation.

Investments in securitized debt instruments

How the risk profile of securitized debt fits into the risk appetite of the scheme:

The scheme investment pattern permits investments in debt and money market instruments with extended maturities. Under this the investments could be in the following form of issuances, viz. CPs, CDs, Securitised debt, etc. i.e for the same acceptable levels of risks there could be multiple instruments available to a Fund Manager. Based on the credit assessment of the issuers the Fund Manager may choose to invest in securitized debt.

Our evaluation process for investment in securitized debt is similar to the approach followed for other types of instruments including money market and bonds. We lay emphasis on credit, liquidity and duration risk while evaluating every prospective investment, keeping in mind the investment objectives of the 48particular scheme.

Policy relating to originators based on nature of originator, track record, NPAs, losses in earlier

securitized debt etc:

The Fund Manager shall do a comprehensive credit assessment of the structure before investment. This includes originator’s credit origination standards, track record on asset quality, more specifically its track record in respect the asset class that is being securitized and also the performance of the pools securitised by the originator in the past. No investments will be made in instruments rated below certain grades as prescribed by the investment committee or in unrated instruments. Prior approval of Trustee will be taken, in case of any investments in unrated instruments.

The securitised paper may pertain to a single asset class e.g., car loans or commercial vehicle loans or a combination of different asset classes i.e. car loans, two wheeler loans and commercial vehicle loans.

Investment focus is towards diversification in the asset pool in terms of geography, underlying collateral.

Although there is no specific guidelines with respect minimum period for which the originator had held the loans in its books), appropriateness of the seasoning (the period for which the originator has held loans on its books) and also the loan to value and instilment to income profile of the pool are important parameters for making investment decision.

In case of single loan securitization, the originator merely transfers the loan existing in his book by way of a single loan sell down. The obligation to repay and service the debt remains with the underlying obligor and hence, it is the obligor whose standalone business and financial risk profile is evaluated. Therefore, the credit rating of a single loan structure mirrors the credit rating of the obligor.

For pool securitization, where the debt repayment is dependent on the underlying pool of borrowers, it is important to evaluate the characteristics of the pool including the type of loan, loan to value ratio, ticket size of loan, geographic distribution etc. and the track record of the originator in terms of volume of securitization activity, historical losses seen in similar pools, stability in cash flow servicing and utilization level of credit enhancement.

Risk Mitigation strategies for investments with each kind of originator:

Apart from the above, risk assessment process includes examination of the credit enhancements offered under the present PTC structure, utilization of credit enhancement in the previous securitization structures of the originator and the trends in credit enhancement utilization of securitization transactions of similar asset classes of other originators. The size & reach of originators, its infrastructure & follow-up mechanism, quality of MIS & the collection process are also considered for each originator.

The nature of the instrument, underlying risks, underlying risk migration perceptions would decide the tenure of the said investments.

There is clear cut segregation of duties and responsibilities with respect to Investment Function and Sales function. Risk assessment and monitoring of investment in Securities Debt is done by a team comprising of credit analyst, fund manager and Head of Fixed Income. The Investment committee also looks into a first time investment in credit, apart from sanctioning overall limits for the same. Investment Decisions are being taken independently based on the above mentioned parameters and investment by the originator in the scheme is based on their own evaluation of the scheme vis a vis their investment objective.

Originator risk can be evaluated and mitigated on the basis of –

(a) Market position and size of the originator and expertise/niche in financing a particular type of asset.

49(b) Systems and processes established by the originator to address operational risk relating to disbursement, collection and recovery of loans.

(c) Extent of data disclosed by the originator for the current pool as well as past pools which showcases the data mining capability of the originator.

(d) Credit enhancement provided based on the pool characteristics, historical performance of past pools and the base case losses assumed by the credit agency.

The level of diversification with respect to the underlying assets, and risk mitigation measures for

less diversified investments:

Framework that will be applied while evaluating investment decision relating to a pool securitization

transaction:

Characteristics/ Mortgage CV Cars Two Micro Persona Single Type of Pool Loan & Wheelers Finance l Loans loan sell CE down Average maturity (in 12m- 12m- 12m- 12m- months) 36m-72m 36m 36m 12m-24m 3m-18m 24m 36m Collateral 5%-25% 10%- 10%- Min Min Min NA margin 25% 25% 15% 20% 20% (including cash , guarantees, excess interest spread, subordination) Average Loan- 65%- 65%- 50%- to-value 70%-90% 90% 90% 75% NA NA NA Average Pool Seasoning (in 3m- months) 6m-12m 6m 3m-6m 3m-6m 1m-3m 3m-6m NA Maximum exposure per 5%- 5%- 5%- 5%- ABS transaction 5%-15% 15% 15% 10% 15% 5%-10% 5%-15% Note - Kindly note that these are indicative ranges and final figures could vary depending upon the overall characteristics of the transaction and market conditions In respect of single sell down loans the process would be similar to the one adopted for investing in the issuer directly. Similarly, the scheme in the normal course of business would not be investing in personal / micro finance pools, unless the levels of comfort arising of the transaction structures, satisfy the investment committee.

The above table is prepared after considering the risk mitigating measures such as Size of the loan, Average original maturity of the pool, Average seasoning of the pool, Loan to Value Ratio, Geographical Distribution and Structure of the pool, default rate distribution & credit enhancement facility. The information contained herein is based on current market conditions and may change from time to time based on changes in such conditions, regulatory changes and other relevant factors. Accordingly, our investment strategy, risk mitigation measures and other information contained herein may change in response to the same. This framework would be used as a reference for evaluation of investment into any securitized debt.

However, each investment would also be evaluated on a case to case basis on its own merits apart from 50these limits.

Other risk mitigation measures

(a) Loan to Value Ratio – is an important parameter which highlights the underwriting standards of the issuer. Also, lower LTV ratios generally result in higher recoveries in case of default.

(b) Average seasoning of the pool - may vary depending on the asset type. Higher seasoning is preferred as it gives better visibility on delinquency levels in the pool.

(c) Default rate distribution – this is studied using empirical data for the originator. This is also a critical data used by the rating agency in determining the credit enhancement levels to be stipulated.

(d) Geographical Distribution – helps in identifying concentration risk in a particular geography and therefore reduces the default risk.

(e) Credit enhancement facility – is provided in pool securitization transactions and is very important as it is used to absorb credit losses stemming from default in the pool assets. The size of credit enhancement is determined on the basis of the issuer’s credit risk profile, the type of asset being securitized and past pool performances.

(f) Liquidity facility – in some cases, in addition to the credit enhancement facility there is also a liquidity facility provided which is used to meet any shortfalls arising from delayed collections or delinquencies in the pool.

Minimum retention percentage by originator of debts to be securitized:

Although there is no specific guidelines with respect minimum retention percentage for which the originator had held the loans in its books), appropriateness of the seasoning (the period for which the originator has held loans on its books) and also the loan to value and installment to income profile of the pool are important parameters for making investment decision.

Minimum retention period of the debt by originator prior to securitization For single loan securitization, there is currently no regulation for minimum retention period of debt by the originator. Our investment decision is driven by the credit quality of the underlying obligor.

For pool securitization, there is currently no regulation for minimum retention period of debt by the originator. Generally, the pool assets we acquire in the form of PTCs have a retention period of 3-6 months by the originator. We follow the extant guidelines pertaining to securitization as set out by the regulator.

The mechanism to tackle conflict of interest when the mutual fund invests in securitized debt of an

originator and the originator in turn makes investments in that particular scheme of the fund:

An investment by the scheme in any security is done after detailed analysis by the Fixed Income team and in accordance with the investment objectives and the asset allocation pattern of a scheme. The robust credit process ensures that there is no conflict of interests when a scheme invests in securitized debt of an originator and the originator in turn makes investments in that particular scheme. Normally the issuer who is securitizing instrument is in need of money and is unlikely to have long term surplus to invest in mutual fund scheme. Furthermore, there is clear cut segregation of duties and responsibilities with respect to Investment function and Sales function. Investment decisions are being taken independently based on the above mentioned parameters and investment by the originator in the scheme is based on their own evaluation of the scheme vis-a-vis their investment objectives 51Our investment decisions are independent of other business functions and are solely based on the assessment of credit risk, liquidity risk and duration risk pertaining to a particular security.

The resources and mechanism of individual risk assessment with the AMC for monitoring investment in securitized debt Risk assessment and monitoring of investment in Securities Debt is done by a team comprising of credit analyst, fund manager and Head of Fixed Income. The Investment committee also looks into a first time investment in credit, apart from sanctioning overall limits for the same. Investment Decisions are being taken independently based on the above mentioned parameters and investment by the originator in the scheme is based on their own evaluation of the scheme vis-a-vis their investment objective.

Apart from monitoring the credit quality of the underlying obligator / originator, for pool securitization transactions we closely monitor the monthly pool performance report which is sent out by the trustee. The reports are tracked for changes in specific pool characteristics which can impact the collection performance and;

Limits for investment in derivatives instruments In accordance with Para 7.5 and 12.25 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024, the following conditions shall apply to the Scheme’s participation in the derivatives market. The investment restrictions applicable to the Scheme’s participation in the derivatives market will be as prescribed or varied by SEBI or by the Trustees (subject to SEBI requirements) from time to time.

i. Position limit for the Mutual Fund in equity index options contracts a. The Mutual Fund position limit in all equity index options contracts on a particular underlying index shall be Rs. 500 crore or 15% of the total open interest of the market in equity index option contracts, whichever is higher, b. This limit would be applicable on open positions in all options contracts on a particular underlying index.

ii. Position limit for the Mutual Fund in equity index futures/stock futures contracts:

The Mutual Fund position limit in all equity index futures/stock futures contracts on a particular underlying index shall be Rs. 500 crore; or 15% of the total open interest in the market in equity index futures/stock futures contracts, whichever is higher, This limit would be applicable on open positions in all futures contracts on a particular underlying index.

iii. Additional position limit for hedging.

In addition to the position limits at point (i) and (ii) above, Mutual Fund may take exposure in equity index

derivatives subject to the following limits:

Short positions in index derivatives (short futures, short calls and long puts) shall not exceed (in notional value) the Mutual Fund’s holding of stocks.

Long positions in index derivatives (long futures, long calls and short puts) shall not exceed (in notional value) the Mutual Fund’s holding of cash, government securities, T-Bills and similar instruments.

52iv. Position limit for the Mutual Fund for stock based derivative contracts The combined futures and options position limit shall be 20% of applicable MWPL v. Position limit for the Scheme The position limits for the Scheme and disclosure requirements are as follows– For stock option and stock futures contracts, the gross open position across all derivative contracts on a

particular underlying stock of a scheme of the Mutual Fund shall not exceed the higher of: 1% of the free float market capitalisation (in terms of number of shares).

Or 5% of the open interest in the derivative contracts on a particular underlying stock (in terms of number of contracts).

This position limit shall be applicable on the combined position in all derivative contracts on an underlying stock at a Stock Exchange.

For index based contracts, the Mutual Fund shall disclose the total open interest held by its scheme or all schemes put together in a particular underlying index, if such open interest equals to or exceeds 15% of the open interest of all derivative contracts on that underlying index.

Exposure Limits:

As per Para 12.25 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 on “Review of norms for investment and disclosure by Mutual Funds in derivatives”, the limits for

exposure towards derivatives are as under:

1. The cumulative gross exposure through equity, debt, derivative positions (including fixed income derivatives), repo transactions in corporate debt securities, Real Estate Investment Trusts (REITs), Infrastructure Investment Trusts (InvITs), other permitted securities/assets and such other securities/assets as may be permitted by the Board from time to time should not exceed 100% of the net assets of the scheme.

2. Mutual Funds shall not write options or purchase instruments with embedded written options.

3. The total exposure related to option premium paid must not exceed 20% of the net assets of the scheme.

4. Cash or cash equivalents with residual maturity of less than 91 days may be treated as not creating any exposure.

5. Exposure due to hedging positions may not be included in the above mentioned limits subject to the

following :- a. Hedging positions are the derivative positions that reduce possible losses on an existing position in securities and till the existing position remains. b. Hedging positions cannot be taken for existing derivative positions. Exposure due to such positions shall have to be added and treated under limits mentioned in Point 1.

c. Any derivative instrument used to hedge has the same underlying security as the existing position being hedged. d. The quantity of underlying associated with the derivative position taken for hedging purposes does not exceed the quantity of the existing position against which hedge has been taken.

6. Exposure due to derivative positions taken for hedging purposes in excess of the underlying position against which the hedging position has been taken, shall be treated under the limits mentioned in point 1.

7. Exposure in derivative positions shall be computed as follows:

Position Exposure Long Future Futures Price * Lot Size * 53Short Future Number of Contracts Option bought Futures Price * Lot Size * Writing of Covered Call Options by Mutual Fund Schemes • Mutual Fund schemes (except Index Funds and ETFs) may write call options only under a covered call strategy for constituent stocks of NIFTY 50 and BSE SENSEX subject to the following:

• The total notional value (taking into account strike price as well as premium value) of call options written by a scheme shall not exceed 15% of the total market value of equity shares held in that scheme.

• The total number of shares underlying the call options written shall not exceed 30% of the unencumbered shares of a particular company held in the scheme. The unencumbered shares in a scheme shall mean shares that are not part of Securities Lending and Borrowing Mechanism (SLBM), margin or any other kind of encumbrances.

• At all points of time the Mutual Fund scheme shall comply with the provisions at paragraph (a) and (b) above. In case of any passive breach of the requirement at paragraph (a), the respective scheme shall have 7 trading days to rebalance the portfolio. During the rebalancing period, no additional call options can be written in the said scheme.

• In case a Mutual Fund scheme needs to sell securities on which a call option is written under a covered call strategy, it must ensure compliance with paragraphs (a) and (b) above while selling the securities.

• In no case, a scheme shall write a call option without holding the underlying equity shares. A call option can be written only on shares which are not hedged using other derivative contracts. • The premium received shall be within the requirements prescribed in terms of Para 12.25 of SEBI Master

Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 i.e. the total gross exposure related to option premium paid and received must not exceed 20% of the net assets of the scheme. • The exposure on account of the call option written under the covered call strategy shall not be considered as exposure in terms of Para 12.25 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024.

The call option written shall be marked to market daily and the respective gains or losses factored into the daily NAV of the scheme until the position is closed or expired.

As and when SEBI notifies amended limits in position limits for exchange traded derivative contracts in future, the aforesaid position limits, to the extent relevant, shall be read as if they were substituted with the SEBI amended limits.

C. Fundamental Attributes < S.O 59> As per para 1.14 of SEBI Master circular no SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, Following are the fundamental attributes of the schemes, in terms of Regulation 18 (15A) of SEBI

(MF) Regulations:

(i) Type of the scheme: As mentioned under the heading “Type of the Scheme” of Part I – Sr. No. III

(ii) Investment Objective: As mentioned under the heading “Investment Objective” of Part I – Sr. No. V

(iii) Investment Pattern: As mentioned under the heading “How will the scheme allocate its assets” of Part II - A

(iv) Terms of Issue: • Liquidity provisions such as listing, repurchase, redemption. Investors may refer Part I and Section II under ‘Other Scheme Specific Disclosures’ for detailed information on listing, repurchase and redemption.

• Aggregate fees and expenses charged to the scheme. Investors may refer Part III ‘Other Details’. • Any safety net or guarantee provided – Not Applicable 54In accordance with Regulation 18(15A) of the SEBI (MF) Regulations, the trustees shall ensure that no change in the fundamental attributes of any scheme, the fees and expenses payable or any other change which would modify the scheme and affect the interest of the unit holders is carried out by the asset management company, unless it complies with sub-regulation (26) of regulation 25 of these regulations.

In accordance with Regulation 25(26) of the SEBI (MF) Regulations, the asset management company shall ensure that no change in the fundamental attributes of any scheme or the trust, fees and expenses payable or any other change which would modify the scheme and affect the interest of unit holders, shall be carried out unless, • SEBI has reviewed and provided its comments on the proposal • A written communication about the proposed change is sent to each unit holder and an advertisement is issued in one English daily newspaper having nationwide circulation as well as in a newspaper published in the language of region where the Head Office of the mutual fund is situated; and • The Unitholders are given an option for a period of atleast 30 calendar days to exit at the prevailing Net Asset Value without any exit load.

D. Other Scheme Specific Disclosures:

Listing and transfer of Listing: units The Scheme is open-ended in nature. It is not necessary to list the units of the scheme on any exchange. Liquidity is ensured to investors by the purchase and sale of Units from/to the Fund at prices related to the relevant Applicable NAV for the purpose of purchasing or redeeming Units from the Fund.

The Trustee, however, has the right to list the Units under the Scheme on any stock exchange/s for better distribution and additional convenience to existing/prospective Unitholders. Even if the Units are listed, the Fund shall continue to offer purchase and redemption facility as specified in this scheme information document. Any listing will come only as an additional facility to investors who wish to use the services of a stock exchange for the purpose of transacting business in the Units of the Scheme.

Transfer of units held in Non-Demat [Statement of Account (‘SOA’)] mode:

As per the AMFI Best Practices Guidelines Circular No.116 /2024-25 dated August 14, 2024, on ‘Standard Process for Transfer of Units held in Non-Demat (SoA) mode’, units held by individual unitholders in Non Demat (‘SoA’) mode can be transferred only in following cases- i. Surviving joint unitholder, who wants to add new joint holder(s) in the folio upon demise of one or more joint unitholder(s).

ii. A nominee of a deceased unitholder, who wants to transfer the units to the legal heirs of the deceased unitholder, post the transmission of units in the name of the nominee. iii. A minor unitholder who has turned a major and has changed his/her status from minor to major, wants to add the name of the parent / guardian, sibling, spouse etc. in the folio as joint holder(s).

55Partial transfer of units held in a folio shall be allowed. If the request for transfer of units is lodged on the record date, the IDCW payout/ reinvestment shall be made to the transferor.

Redemption of the transferred units shall not be allowed for 10 days from the date of transfer. This will enable the investor to revert in case the transfer is initiated fraudulently.

The facility for transfer of units held in SoA mode shall be available only through online mode via the transaction portals of the RTAs and the MF Central, i.e., the transfer of units held in SoA mode shall not be allowed through physical/ paper-based mode or via the stock exchange platforms, MFU, channel partners and EOPs etc.

For details, please refer Statement of Additional Information (SAI).

Dematerialization of units Unit holders will have an Option to hold the units by way of an Account < S.O 57> Statement or in Dematerialized (‘Demat’) form. Unitholders who wish to trade in units would be required to have a demat account. Unit holders opting to hold the units in Demat form must provide their Demat Account details in the specified section of the application form/transaction feed.

The Applicant intending to hold the units in Demat form are required to have a beneficiary account with a Depository Participant (DP) registered with NSDL / CDSL and will be required to indicate in the application the DP's name, DP ID Number and the Beneficiary Account Number of the applicant held with the DP at the time of purchasing Units. Unitholders are requested to note that request for conversion of units held in Account Statement (non-demat) form into Demat (electronic) form or vice versa should be submitted to their Depository Participants. The demat request to depository must be submitted for all units in a folio. In case Unit holders do not provide their Demat account details or the Demat details provided in the application form are incomplete / incorrect or do not match with the details with the Depository records, the Units will be allotted in account statement mode provided the application is otherwise complete in all respect and accordingly an account statement shall be sent to them.

Minimum Target amount The Fund seeks to collect a minimum subscription amount of Rs. (This is the minimum 10,00,00,000/- (Rupees Ten crores only) under the scheme. amount required to operate the scheme and if this is not collected during the NFO period, then all the investors would be refunded the amount invested without any return.) Maximum Amount to be There is no upper limit on the total amount that may be collected. After raised (if the minimum subscription amount has been collected, allotment will be any) made to all valid applications.

Minimum balance to be maintained and consequences of non-

maintenance: < S.O 36> 56There is no requirement of minimum balance.

Dividend Policy ( ID CW ) IDCW Frequency IDCW is declared subject to availability and adequacy of distributable surplus.

IDCW Record Dates: At the discretion of the Trustees (If the record date is not a Business Day, the immediately following Business Day will be the record date) Under the Income Distribution cum capital withdrawal (IDCW) option, the Trustee may at any time decide to distribute by way of IDCW, the surplus by way of realised profit and interest, net of losses, expenses and taxes, if any, to Unitholders if, in the opinion of the Trustee, such surplus is available and adequate for distribution. The Trustee's decision with regard to such availability and adequacy of surplus, rate, timing and frequency of distribution shall be final. The Trustee may or may not distribute surplus, even if available, by way of Income Distribution cum capital withdrawal (IDCW).

The IDCW will be paid to only those Unitholders whose names appear on the register of Unitholders of the Scheme / Option at the close of the business hours on the record date, which will be announced in advance.

In case of dynamic lien, the Income Distribution cum capital withdrawal (IDCW) may be credited to the financier The Income Distribution cum capital withdrawal (IDCW) Option will be available under two sub-options – the Payout Option and the Reinvestment Option.

Payout of Income Distribution cum capital withdrawal option

(IDCW): Unitholders will have the option to receive payout of their IDCW by way of Payorder any other means which can be enchased or by way of direct credit / electronic payout into their account.

Reinvestment of Income Distribution cum capital withdrawal option

(IDCW): Under the reinvestment option, The amounts will be reinvested in the Reinvestment IDCW Option at the Applicable NAV announced immediately following the record date.

The requirement of giving notice shall not be applicable for IDCW Option having frequency upto one month.

However, the Trustees reserve the right to introduce new options and / or alter the IDCW payout intervals, frequency, including the day of payout.

Allotment (Detailed Pursuant to Para 14.4 of SEBI Master Circular no. procedure) SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, the investor whose transaction has been accepted by Kotak Mahindra Asset Management Company Ltd. / Kotak Mahindra Mutual Fund shall

receive the following:

571. The AMC shall send an allotment confirmation specifying the units allotted by way of email and/or SMS within 5 Business Days of receipt of valid application/transaction to the Unit holders registered e-mail address and/ or mobile number (whether units are held in demat mode or in account statement form).

2. The holding(s) of the beneficiary account holder for units held in demat mode will be shown in the statement issued by respective Depository Participants (DPs) periodically.

3. A consolidated account statement (CAS) for each calendar month on or before 12th of the succeeding month shall be sent by email (wherever investor has provided email id) or physical account statement on or before 15th of the succeeding month where investor has not provided email id/ have opted for delivery via physical mode., across the schemes of the mutual funds, to all the investors in whose folio(s) transaction(s) has/have taken place during the month. The same shall be sent by the AMC or by the Agencies appointed by the AMC for non demat unit holders.

Refund If application is rejected, full amount will be refunded within 5 working days of closure of NFO. If refunded later than 5 working days @ 15% p.a. for delay period will be paid and charged to the AMC

Who can invest The following are eligible to apply for purchase of the Units:

This is an indicative list and • Resident Indian Adult Individuals, either singly or jointly (not investors shall consult their exceeding three). financial advisor to • Parents/Lawful guardians on behalf of Minors.

ascertain whether the • Companies, corporate bodies, registered in India. scheme is • Registered Societies and Co-operative Societies authorised to suitable to their risk profile. invest in such Units.

• Public sector undertakings, public/Statutory corporations subject to general or specific permissions granted to them by the Central/State governments from time to time. • Religious and Charitable Trusts under the provisions of 11(5) of the Income Tax Act, 1961 read with Rule 17C of the Income Tax Rules, 1962.

• Trustees of private trusts authorised to invest in mutual fund schemes under their trust deeds. • Public Trusts in Maharashtra can invest up to 50% of its available funds • Partner(s) of Partnership Firms.

• Association of Persons or Body of Individuals, whether incorporated or not. • Hindu Undivided Families (HUFs). • Banks (including Co-operative Banks and Regional Rural Banks) and Financial Institutions and Investment Institutions.

• Non-Resident Indians/Persons of Indian origin resident abroad

(NRIs) on full repatriation or non-repatriation basis. • Other Mutual Funds registered with SEBI. • International Multilateral Agencies approved by the Government of India. • Army/Navy/Air Force, Para-Military Units and other eligible institutions.

58• Scientific and Industrial Research Organizations. • Provident/Pension/Gratuity and such other Funds as and when permitted to invest. • Public Financial Institution as defined under the Companies Act

2013. • Universities and Educational Institutions. • Other schemes of Kotak Mahindra Mutual Fund may, subject to the conditions and limits prescribed in the SEBI Regulations and/or by the Trustee, AMC or Sponsor, subscribe to the Units under the Scheme.

• Foreign Portfolio Investors (FPIs) or sub-accounts of FPI’s registered with SEBI The list given above is indicative and the applicable law, if any, shall supersede the list.

Who cannot invest Acceptance of Subscriptions from U.S. Persons and Residents of Canada w.e.f. November 17, 2016: - The Scheme shall not accept subscriptions from U.S. Persons and Residents of Canada, except where transaction request received from Non – resident Indian (NRIs) / Persons of Indian Origin (PIO) who at the time of investment are present in India and submit physical transaction request along with such declarations / documents as may be prescribed by Kotak Mahindra Asset Management Company Ltd and Kotak Mahindra Trustee Company Ltd.

The AMC shall accept such investments subject to the applicable laws and such other terms and conditions as may be notified by the AMC/ Trustee Company. The investor shall be responsible for complying with all the applicable laws for such investments.

The AMC reserves the right to put the transaction request on hold/reject the transaction request, or reverse the units allotted, as the case may be, as and when identified by the AMC, which are not in compliance with the terms and conditions notified in this regard.

The Trustee/AMC reserves the right to change/modify the provisions mentioned above at a later date subject to subject to SEBI (MF) Regulations and circulars issued thereunder from time to time How to Apply and other 1. The investors can submit the Application forms and Key details Information Memorandum (along with transaction slip)/ forms for redemption/ switches at the branches of AMC or Investor Service Centres (ISCs)/Official Points of Acceptance (OPAs) of the Registrar (CAMS) or distributors or on the website of Kotak Mahindra Mutual Fund (www.kotakmf.com).

Where Units under a Scheme are held under both Direct Plan and Regular Plan, investors should clearly mention the plan from which redemption/switch requests are to be processed.

59Further in line with Para 16.2.11 and 16.2.1 of SEBI circular No.

SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 it has been decided to allow investors can directly access infrastructure of the recognised stock exchanges to purchase mutual fund units directly from Mutual Fund/ Asset Management Companies.

Please refer to the SAI and Application form for the instructions.

2. Link for the list of official points of acceptance, collecting banker details etc. https://www.kotakmf.com/Information/statutory- disclosure/disclosuresrelatedtosidandkim

3. Computer Age Management Services Ltd. (CAMS) (Registrar) AVA Tower, Old No. 788 & 789, Electricity Avenue, New No. 152 & 150, Anna Salai, Beside Rayala Towers, Chennai - 600002.

Contact details - 044 6110 4034 Email Id – enq_k@camsonline.com Website - www.camsonline.com To inform investors that it is mandatory to mention their bank account numbers in their applications/requests for redemption.

The policy regarding Not Applicable reissue of repurchased units, including the maximum extent, the manner of reissue, the entity (the scheme or the AMC) involved in the same.

Restrictions, if any, on The Asset Management Company shall, on production of instrument of the right to transfer together with relevant documents, shall register the transfer within timelines as defined in the SEBI Regulation. The Units of the freely retain or dispose of Scheme held in the dematerialised form will be fully and freely units being offered. transferable (subject to lock-in period, if any and subject to lien, if any marked on the units) in accordance with the provisions of SEBI (Depositories and Participants) Regulations, 2018 as may be amended from time to time and as stated in. Para 14.4.4 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024.

Further, for the procedure of release of lien, the investors shall contact their respective DP.

Transfer of units held in Non-Demat [Statement of Account (‘SOA’)] mode:

As per the AMFI Best Practices Guidelines Circular No.116 /2024-25 dated August 14, 2024, on ‘Standard Process for Transfer of Units held in Non-Demat (SoA) mode’, units held by individual unitholders in Non Demat (‘SoA’) mode can be transferred only in following cases- 60i. Surviving joint unitholder, who wants to add new joint holder(s) in the folio upon demise of one or more joint unitholder(s).

ii. A nominee of a deceased unitholder, who wants to transfer the units to the legal heirs of the deceased unitholder, post the transmission of units in the name of the nominee. iii. A minor unitholder who has turned a major and has changed his/her status from minor to major, wants to add the name of the parent / guardian, sibling, spouse etc. in the folio as joint holder(s).

Partial transfer of units held in a folio shall be allowed. If the request for transfer of units is lodged on the record date, the IDCW payout/ reinvestment shall be made to the transferor.

Redemption of the transferred units shall not be allowed for 10 days from the date of transfer. This will enable the investor to revert in case the transfer is initiated fraudulently.

The facility for transfer of units held in SoA mode shall be available only through online mode via the transaction portals of the RTAs and the MF Central, i.e., the transfer of units held in SoA mode shall not be allowed through physical/ paper-based mode or via the stock exchange platforms, MFU, channel partners and EOPs etc.

For details, please refer Statement of Additional Information (SAI).

61Cut off timing for subscriptions/ MINIM for Purchases/Switch-ins redemptions/ switches

1. In respect of valid applications received upto 3.00 p.m.

This is the time before which your on a business day and entire amount is available in the application (complete in all mutual fund’s account for utilization before the cut off respects) should reach the time of the same day – closing NAV of the day of official points of receipt of application;

2. In respect of valid applications received after 3.00 p.m. on a business day and the entire amount is available in acceptance. the mutual fund’s account for utilization before cut off time of the next business day – the closing NAV of the next business day;

3. Irrespective of the time of receipt of the application where the entire amount is available in Mutual fund’s account for utilization before cut off time on any subsequent business day – the closing NAV of such subsequent business day.

The above cut-off timings and applicability of NAV shall be applicable in respect of valid applications received at the Official Point(s) of Acceptance on a Business Day:

1. It is clarified that switches will be considered as redemption in the switch-out scheme and purchase / subscription in the switch-in scheme

2. Cheques received on a business day may be deposited with the primary bankers of the respective location on the next business day. NAV shall be as per the applicable NAV mentioned above. To enable early sighting of funds by the schemes, investors are requested to avail of electronic facilities like RTGS / NEFT in respect of subscriptions and submit the proof of transfer of funds along with their applications. AMC shall not be responsible for any delay on account of banking clearance or circumstances which are beyond the control of AMC.

3. The revised provisions for applicability of NAV based on realization of funds will be applicable to all types of investment including various systematic investments routes (viz, SIP, STP, Transfer of IDCW Plan etc.) as may be offered by the Scheme from time to time.

62Applicable NAV for Redemption/ Switch outs a) where the application received upto 3.00 pm – closing NAV of the day of receipt of application; and b) an application received after 3.00 pm – closing NAV of the next business day.

Further, where the AMC or the Registrar has provided a facility to the investors to redeem /switch-out of the Scheme through the medium of Internet by logging onto specific web-sites or any other facilities offered by the AMC and where investors have signed up for using these facilities, the Applicable NAVs will be as provided above.

Minimum amount for Minimum application amount for purchases purchase/redemption/switches (mention the provisions for Initial Purchase Additional SIP Purchase ETFs, as may be applicable, for (Non- SIP) Purchase (Non- direct subscription/redemption SIP) with AMC. Rs1000/- and any Rs. 100/- and any Rs. 500- and any amount thereafter amount amount thereafter thereafter

Minimum amount for redemption:

Minimum amount for redemption: The minimum redemption amount for all plans will be Rs. 500/- or account balance, whichever is lower.

The provisions relating to Minimum Amount (including Additional Application Amount) for subscription / purchase will not be applicable for investments made in the name of Designated Employees of the AMC pursuant to Para 6.10 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024 on ‘Alignment of interest of Designated Employees of Asset Management Companies’ with the Unitholders of the Mutual Fund Schemes Waiver of Minimum Pursuant to Para 6.10 of SEBI Master circular Subscription SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June Amount 27,2024 and SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/36 dated March 21, 2025 on Alignment of interest of Designated Employees of Asset Management Companies (AMCs) with the Unitholders of the Mutual Fund Schemes has, inter alia mandated that a minimum of slab wise percentage (as opted 63by AMC) of gross annual CTC net of income tax and any statutory contributions of the Specified Designated Employees of the AMCs shall be invested in units of the scheme(s) of the Fund in which they have a role/ oversight.

Accordingly, the criteria of minimum investment amounts would not apply for such Investments made by Designated Employees of the Kotak Mahindra Asset Management Company Limited in compliance with the aforesaid

circular(s) Accounts Statements The AMC shall send an allotment confirmation specifying < S.O 50, 60> the units allotted by way of email and/or SMS within 5 working days of receipt of valid application/transaction to the Unit holders registered e-mail address and/ or mobile number (whether units are held in demat mode or in account statement form).

A Consolidated Account Statement (CAS) detailing all the transactions across all mutual funds (including transaction charges paid to the distributor) and holding at the end of the month shall be sent to the Unit holders in whose folio(s) transaction(s) have taken place during the month by mail or email on or before 12th of the succeeding month, or in physical mode before 15th of the succeeding month.

Half-yearly CAS shall be issued at the end of every six months (i.e. September/ March) on or before 18th day of April and October and to investors that have opted for delivery via physical mode, on or before the twenty-first

(21st) day of April and October. However, where an investor does not wish to receive CAS through email, option shall be given to the investor to receive the CAS in physical form at the address registered with the Depositories and the AMCs/MF-RTAs For further details, refer SAI.

Dividend/ IDCW The payment of dividend/IDCW to the unitholders shall be made within seven working days from the record date.

Redemption The redemption or repurchase proceeds shall be dispatched to the unitholders within three working days from the date of redemption or repurchase.

For list of exceptional circumstances refer para 14.1.3 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024For schemes investing atleast 80% of total assets in permissible overseas investments (as per Clause 12.19 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024), the transfer of redemption or repurchase proceeds to the unitholders shall be made within five working days from the date of redemption or repurchase.

64Bank Mandate < S.O 61> As per the directives issued by SEBI it is mandatory for an investor to declare his/her bank account number. To safeguard the interest of Unitholders from loss or theft of their refund orders/redemption cheques, investors are requested to provide their bank details in the Application Form.

In case an existing Unitholder is submitting a request for Change in his Bank Details, he needs to submit an old and new bank account. In absence of the same, the request for Change in Bank Mandate is liable to be rejected Investors have an option of registering their bank accounts, by submitting the necessary forms & documents. At the time of redemption, investors can select the bank account to receive the amount.

Delay in payment of redemption / The Asset Management Company shall be liable to pay repurchase proceeds/dividend interest to the unitholders at rate as specified vide clause 14.2 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024 by SEBI for the period of such delay Unclaimed Redemption and Income In accordance with Para 14.3 of SEBI Master Circular no.

Distribution cum Capital SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, Withdrawal Amount < S.O 52> 2024 and SEBI Letter SEBI/HO/IMD-SEC- 2/P/OW/2025/02346/1 dated January 22,2025 the unclaimed Redemption amount and IDCW amount that are currently allowed to be deployed by the Mutual Fund only in call money market or money market Instruments, shall also be allowed to be invested in a separate plan of only Overnight scheme / Liquid scheme / Money Market Mutual Fund scheme floated by Mutual Funds specifically for deployment of the unclaimed amounts. There shall a separate scheme/plan for Redemption amount and IDCW amount, pending for less than 3 years and more than 3 years Following are timelines for deployment by Mutual fund a) Transfer of Unclaimed redemption and dividend amount to Unclaimed Dividend and Redemption Scheme (UDRS) after 90 days and not beyond 105 days from date of issuance of the instruments b) On completion of first 3 years of a separate plan of Overnight scheme / Liquid scheme / Money Market Mutual Fund scheme, AMC shall transfer such units to UDRS plan (> 3 years) within 10 business days of subsequent month c) The amount of income accrued on daily basis on unclaimed amount beyond 3 years shall be transferred on a monthly basis ( ie on or before 10th calendar day of subsequent month ) to the investor education scheme/folio 65Provided that such schemes where the unclaimed redemption and IDCW amounts are deployed shall be only those Liquid scheme / Money Market Mutual Fund schemes which are placed in A-1 cell (Relatively Low Interest Rate Risk and Relatively Low Credit Risk) of Potential Risk Class matrix as as per para 17.5 of SEBI Master Circular no.

SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27,

2024.

AMCs shall not be permitted to charge any exit load in this plan and TER (Total Expense Ratio) of such plan shall be capped as per the TER of direct plan of such scheme or at 50bps whichever is lower. Investors who claim these amounts during a period of three years from the due date shall be paid initial unclaimed amount along with the income earned on its deployment. Investors who claim these amounts after 3 years, shall be paid initial unclaimed amount along with the income earned on its deployment till the end of the third year. After the third year, the income earned on such unclaimed amounts shall be used for the purpose of investor education. AMC shall play a proactive role in tracing the rightful owner of the unclaimed amounts considering the steps suggested by regulator vide the referred circular.

As per SEBI Circular no. SEBI/HO/IMD/IMD-SEC- 3/P/CIR/2025/15 dated February 12, 2025 a service platform for investors to trace inactive and unclaimed Mutual Fund folios- MITRA (Mutual Fund Investment Tracing and Retrieval Assistant) MITRA platform is developed and hosted by the QRTAs (CAMS and KFintech) would be available through a link on the website of MF Central, AMCs, AMFI, the two QRTAs and SEBI.

MITRA platform will facilitate the investors with a searchable database of inactive and unclaimed Mutual Fund folios at an industry-level which will empower the investors

on following manner: • Enable investors/ legal claimants to identify the overlooked investments or any investments made by any other person for which he/she may be rightful legal claimant. • Encourage investors to do KYC as per the current norms thus reducing the number of non-KYC compliant folios.

• Contribute towards building a transparent financial ecosystem and will be reliable medium for investors to find their inactive and unclaimed Mutual Fund investments.

66• Build and incorporate mitigants against fraud risk An inactive folio shall be defined as “Mutual Fund Folio(s) where no investor-initiated transaction/s (financial and non- financial) have taken place in the last 10 years, but unit balance is available”.

This portal would display only Fund Names and investor has to approach the respective MFs for more information.

Disclosure w.r.t investment by As per Para 17.6 of SEBI Master Circular no. minors < S.O 37> SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024, the following Process for Investments in the name of a

Minor through a Guardian will be applicable: a. Payment for investment by any mode shall be accepted from the bank account of the minor, parent or legal guardian of the minor, or from a joint account of the minor with parent or legal guardian. For existing folios, the AMCs shall insist upon a Change of Pay-out Bank mandate before redemption is processed.

b. Redemption proceeds shall be credited only in verified bank account of the minor, i.e the account the minor may hold with the parent/legal guardian after completing KYC formalities. c. Upon the minor attaining the status of major, the minor in whose name the investment was made, shall be required to provide all the KYC details, updated bank account details including cancelled original cheque leaf of the new account. No further transactions shall be allowed till the status of the minor is changed to major.

d. AMCs shall build a system control at the account set up stage of Systematic Investment Plan (SIP), Systematic Transfer Plan (STP) and Systematic Withdrawal Plan

(SWP) on the basis of which, the standing instruction is suspended when the minor attains majority, till the status is changed to major.

Please refer SAI for detailed process on investments made in the name of a Minor through a Guardian 67III. OTHER DETAILS A. Periodic Disclosures Monthly and Half yearly The Mutual Funds/ AMCs, shall disclose portfolio (along with ISIN) as on

Disclosures: Portfolio / monthly, half-yearly basis for all the schemes on the website of the Kotak Financial Results Mahindra Mutual Fund viz. www.kotakmf.com and on the website of AMFI This is a list of securities (www.amfiindia.com) within 10 days from the close of each month/ half-year where the corpus of the respectively in a user-friendly and downloadable spreadsheet format. The link scheme is currently for the mentioned disclosures - invested. The market value https://www.kotakmf.com/Information/statutory-disclosure/information of these investments is also stated in portfolio In accordance with Para 5.1 and 5.3 of SEBI Master Circular no.

disclosures. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 effective from October 01, 2021,unitholders whose e-mail addresses are registered, Mutual Funds/AMC shall send the details of the scheme portfolio including the scheme risk-o-meter, name of benchmark and risk-o-meter of benchmark while communicating the fortnightly, monthly and half-yearly statement of scheme portfolio via email within 5 days of every fortnight for debt schemes, 10 days from the close of each month for other schemes and 10 days from the close of half-year for all schemes. AMCs shall provide a link to investors to their registered email to enable the investor to directly view/download only the portfolio of schemes subscribed by the said investor. The Mutual Fund / AMC shall provide a physical copy of statement of its scheme portfolio, without charging any cost, on specific request received from a unit holder. An advertisement shall be published every half-year disclosing the hosting of the half-yearly statement of the schemes on website of Kotak Mahindra Mutual Fund and on the website of AMFI and the modes such as SMS, telephone, email or written request (letter) through which a unitholder can submit a request for a physical or electronic copy of the statement of scheme portfolio.

Such advertisement shall be published in the all India edition of at least two daily newspapers, one each in English and Hindi.

Half Yearly Results The soft copy of unaudited financial results shall within one month from the close of each half year i.e. 31st of March and the 30th of September, be hosted on the website kotakmf.com and will be sent to AMFI for posting on its website www.amfiindia.com. The link for the mentioned disclosures -

https://www.kotakmf.com/Information/statutory-disclosure/financials Also an advertisement of hosting of the unaudited results shall be published in one English daily newspaper circulating in the whole of India and in a newspaper published in the language of the region where the Head Office of the Mutual Fund is situated.

Annual Report Pursuant to Regulation 56 of SEBI (Mutual Funds) Regulations, 1996 read with Para 5.4 of SEBI Master Circular no. SEBI/HO/IMD/IMD-PoD- 1/P/CIR/2024/90 dated June 27, 2024and SEBI Mutual Fund (Second Amendment) Regulation 2018, the scheme wise annual report or abridged summary thereof will be hosted on the website in machine readable format of the Kotak Mahindra Mutual Fund viz. kotakmf.com and on the website of AMFI, immediately after approval in Annual General Meetings within a period of four months, from the date of closing of the financial year (31st March). The AMCs shall display the link prominently on the website of the 68Kotak Mahindra Mutual Fund viz. kotakmf.com and make the physical copies available to the unitholders, at their registered offices at all times. Unit holders whose e-mail addresses are not registered will have to specifically ‘opt in’ to receive physical copy of scheme wise annual report or abridged summary thereof. The unit holders may request for a physical copy of scheme annual reports at a price and the text of the relevant scheme by writing to the Kotak Mahindra Asset Management Company Ltd. / Investor Service Centre / Registrar & Transfer Agents. AMC shall provide a physical copy of abridged report of the annual report, without charging any cost, on specific request received from a unit holder. An advertisement shall be published every year disclosing the hosting of the scheme wise annual report on website of Kotak Mahindra Mutual Fund and on the website of AMFI and the modes such as SMS, telephone, email or written request (letter) through which a unitholder can submit a request for a physical or electronic copy of the scheme wise annual report or abridged summary thereof. Such advertisement shall be published in the all India edition of at least two daily newspapers, one each in English and Hindi. The link for the mentioned disclosures -

https://www.kotakmf.com/Information/statutory-disclosure/financials Risk-o-meter< S.O 38> In accordance with Para 17.4 of SEBI Master Circular no.

SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024 and SEBI

Circular no. SEBI/HO/IMD/PoD1/CIR/P/2024/150 dated November 05, 2024:

The Risk-o-meter shall have following six levels of risk: i. Low Risk- Irish Green ii. Low to Moderate Risk- Chartreuse iii. Moderate Risk- Neon Yellow iv. Moderately High Risk- Caramel v. High Risk Dark Orange and vi. Very High Risk- Red The evaluation of risk levels of a scheme shall be done in accordance with the aforesaid circular.

Any change in risk-o-meter shall be communicated by way of Notice cum Addendum and by way of an e-mail or SMS to unitholders. The risk-o-meter shall be evaluated on a monthly basis and the risk-o-meter alongwith portfolio disclosure shall be disclosed on the AMC website as well as AMFI website within 10 days from the close of each month.

The Product Labelling assigned during the NFO is based on internal assessment of the scheme characteristics or model portfolio and the same may vary post NFO when the actual investments are made.

Scheme Summary In accordance with SEBI letter dated December 28, 2021 and AMFI emails Document (SSD) dated March 16, 2022 and March 25, 2022, Scheme summary document for < S.O 38> all schemes of Kotak Mahindra Mutual Fund in the requisite format (pdf, spreadsheet and machine readable format) shall be uploaded on a monthly basis i.e. 15th of every month or within 5 working days from the date of any change or modification in the scheme information on the website of Kotak Mahindra Mutual Fund i.e. www.kotakmf.com, AMFI i.e.

www.amfiindia.com and Registered Stock Exchanges i.e. National Stock Exchange of India Limited and BSE Limited.

69B. Transparency/NAV Disclosure (Details with reference to information given in Section I) <S.O.41> The NAVs of the Scheme will be calculated and disclosed on every Business day on the website of the Kotak Mahindra Mutual Fund viz www.kotakmf.com and AMFI’s website www.amfiindia.com by 11.00 p.m. The First NAV of the scheme shall be declared within 5 working days from the date of allotment.

In case the scheme has exposure in overseas securities/Mutual Fund units, the NAV will be published post receipt of the Price/ NAV of the overseas investments. Based on the current scheme exposure, the NAV will be published on the website of AMFI (www.amfiindia.com) and Kotak Mahindra Mutual Fund (www.kotakmf.com) by 10.00 a.m. of the following business day in accordance with paragraph 8.2 of SEBI Master circular No. SEBI/HO/IMD/IMD-PoD-1/P/CIR/2024/90 dated June 27, 2024.

Unitholders may avail the facility to receive the latest available NAVs through SMS by submitting a specific request in this regard to the AMC/Mutual Fund. Also, information regarding NAVs can be obtained by the Unit holders / Investors by visiting the nearest ISC.

Delay in uploading of NAV beyond 11.00 p.m. of every business day shall be explained in writing to AMFI.

In case the NAVs are not available before the commencement of business hours on the following business day due to any reason, a press release for revised NAV shall be issued.

In terms of SEBI regulations, a complete statement of the Scheme portfolio will be sent to all unitholders, within ten days from the close of each month / half-year whose email addresses are registered with the Mutual Fund.

The portfolio of the scheme (along with ISIN) shall also be disclosed on the website of Mutual Fund (kotakmf.com) and on the website of AMFI (www.amfiindia.com) on a monthly and half-yearly basis within 10 days from the close of each month/ half-year respectively in a user-friendly and downloadable spreadsheet format.

C. Transaction charges and stamp duty

(a) Transaction Charges - Investors are requested to note that no transaction charges shall be deducted from the investment amount given by the investor for all transactions / applications (including SIP’s) received through the distributors (i.e. in Regular Plan) and full investment amount (subject to deduction of statutory charges, if any) will be invested in the Scheme.

(b) Stamp Duty - A stamp duty @ 0.005% would be levied on all applicable mutual fund transactions.

Accordingly, pursuant to levy of stamp duty, the number of units allotted on purchase transactions (including reinvestment IDCW and Switch in) to the unitholders would be reduced to that extent.

Details regarding transaction charges and stamp duty refer to SAI.

D. Associate Transactions- Please refer to Statement of Additional Information (SAI).

E. Taxation The information is provided for general information purposes only. However, in view of the individual nature 70of tax implications, each investor is advised to consult his or her own tax adviser with respect to the specific tax implications arising out of his or her participation in the scheme.

Short Term and Long Term Capital Gain Taxation Rates -Resident Individual, HUF, Domestic Corporate, NRI$ Particula Investments Listed or Short-term capital gains - Long Term Capital gains- rs made Unlisted Investments redeemed on Investments redeemed on or after 01-04-2025 or after 01-04-2025 Equity oriented Holding Tax Rate^ Holding Tax Rate^ mutual fund Period Period ( > = 65% - - = < 12 20% > 12 12.5 Domestic equity months months 0% shares) $ Subject to NRI having Permanent Account Number (PAN) in India. The TDS deductible in case of NRI shall also be increased by applicable surcharge as per Note 1 and 4% health and education cess. In case of NRI, if PAN is not available and specified declaration is not provided as specified under Rule 37BC, TDS @ higher of 20% or rates calculated as above will be deducted. The tax rates are subject to DTAA benefits available to NRI's.

As per the Finance Act 2013, submission of tax residency certificate (“TRC”) will be necessary for granting Double Taxation Avoidance Agreement (“DTAA”) benefits to non-residents. A Taxpayer claiming DTAA benefit shall furnish a TRC of his residence obtained by him from the Government of that country or specified territory. Further, in addition to the TRC, the non-resident shall also provide electronically filed Form 10F and such other documents /information, as may be prescribed by the Indian Tax Authorities and Kotak Mahindra Mutual Fund or Kotak Mahindra Asset Management Company Ltd. Further investor needs to certify in its No PE declaration that the one of the principle purpose of investment is not to avail the treaty benefits & the investment asset & investment income are beneficial hold by the investor claiming DTAA benefits.

^ Tax rates for resident and non-residents shall be increased by applicable surcharge as per Note 1 and 4% Health & Education Cess.

Tax implication on income distribution cum capital withdrawal (IDCW) received by unit holders Categories of Unit Threshold TDS Rate Taxation Rate Holders Rs. As per applicable slab rates Resident Unit 10,000(w.e.f plus applicable surcharge 10% Holders 1st April , and cess (Refer Note 1)

2025) Non-Resident Unit Holders (subject to DTAA benefits, in case applicable) 20% plus applicable 20% plus applicable

(1) FII/FPI NILs surcharge and cess surcharge and cess (Refer 71(Refer note 1) Note 1)

(2)Foreign company/corporates 20% plus applicable 35% plus applicable Purchase in Indian NILs surcharge and cess (Refer surcharge and cess Rupees note 1) (Refer Note 1) 20% plus applicable 20% plus applicable Purchase in Foreign NILs surcharge and cess (Refer surcharge and cess Currency note 1) (Refer Note 1)

(3) Others 20% plus applicable At slab rates applicable Purchase in Indian NILs surcharge and cess (Refer plus applicable surcharge Rupees note 1) and cess (Refer Note 1) 20% plus applicable 20% plus applicable Purchase in Foreign NILs surcharge and cess surcharge and cess (Refer Currency (Refer note 1) Note 1) Note 1: - A) In case of foreign companies;

- 2% where the total income exceeds Rs. 10,000,000 but less than / equal to Rs. 100,000,000 - 5% where the total income exceeds Rs. 100,000,000 B) In case of resident domestic corporate unit holders; - 7% where the total income exceeds Rs. 10,000,000 but less than / equal to Rs. 100,000,000 or - 12% where the total income exceeds Rs. 100,000,000 - 10% where domestic company is eligible & exercises the option granted u/s 115BAA or 115BAB of the Act.

C) In case of non-corporate resident unit holders being partnership firms covered under Indian Partnership Act, 1932/ Limited liability partnership covered under Limited Liability Partnership Act, 2008:

- 12% where the total income exceeds Rs.10,000,000 D) (I) In case of resident and non-resident unit holders being individual, HUF, AOP, BOI and artificial juridical person (opting old regime of taxation);

Income Surcharge Rates Total Income Other Income (i.e Income Other Income (i.e Income Capital gains covered other than Capital gains other than Capital gains under section 111A, covered under section covered under section section 112A, section 111A, section 112A, 111A, section 112A, 112, & 115AD(1)(b)

section 112, 115AD(1)(b) section 112, 115AD(1)(b) & company dividend. & company dividend). & company dividend).

Upto 50Lakh Nil Nil More than 50Lakh 10% 10% up to 1 Cr More than 1 Cr but 15% 15% up to 2Cr More than 2 Cr Up to 2 cr 15% 15% More than 2 cr but 25% 15% up to 5cr More than 5cr 37% 15% 72(II) In case of resident and non-resident unit holders being individual, HUF, AOP, BOI and artificial juridical person (who have not elected for old regime of taxation);

Income Surcharge Rates Total Income Other Income (i.e Income Other Income (i.e Income Capital gains covered other than Capital gains other than Capital gains under section 111A, covered under section covered under section section 112A, section 111A, section 112A, 111A, section 112A, 112, & 115AD(1)(b) &

section 112, 115AD(1)(b) section 112, 115AD(1)(b) company dividend. & company dividend). & company dividend).

Upto 50Lakh Nil Nil More than 50Lakh 10% 10% up to 1 Cr More than 1 Cr but 15% 15% up to 2Cr More than 2 Cr Up to 2 cr 15% 15% More than 2 cr 25% 15% Note 2: - W.e.f. 01.04.2020, as per Section 115R, no additional income tax payable on amount of distributed income on or after 01.04.2020.

Note 3: - Section 112A r.w.s section 55(ac) levies capital gains tax @ 12.5% on Long Term Capital Gains arising on transfer of units of equity-oriented funds.

The salient features of the capital gain tax are as under:

Any transfer of equity-oriented fund units on or after 1 April 2018, shall not be exempt under section 10(38) Long term capital gains in excess of Rs. 1.25 lakh shall be taxable at rates mentioned in table above plus surcharge (if any, as applicable) plus health & education cess @ 4%.

The capital gain will be computed without giving effect to the 1st and 2nd proviso to section 48 in the manner laid down under the section i.e. without indexation benefit and without foreign currency conversion benefit.

Note 4: - Tax Rates Regimes available for Domestic Corporate companies-

(a) 30% if investor falls into highest tax bracket.

(b) 25% If total turnover or gross receipts in the financial year 2020-21 does not exceed Rs. 400 crores.

(c) 22% lower rate is optional and subject to fulfilment of certain conditions (not claiming specified incentives and deductions) as provided in section 115BAA.

(d) 15% lower rate is optional for companies engaged in manufacturing business (set-up & registered on or after 1 October 2019) subject to fulfilment of certain conditions (not claiming specified incentives and deductions as provided in section 115BAB.

Further, the domestic companies are subject to minimum alternate tax (except for those who opt for lower rate of tax of 22%/15%) not specified in above tax rates Note 5: - As per section 139AA of the Income tax Act, 1961 (‘the Act’) read with rule 114AAA of the Income- tax Rules, 1962, in the case of a resident person, whose PAN has become inoperative due to PAN-Aadhaar not being linked on or before 30 June 2023, it shall be deemed that he has not furnished the PAN and tax could be withheld at a higher rate of 20% as per section 206AA of the Act Note 6: - Relaxation to non-residents from deduction of tax at higher rate in the absence of PAN subject to them providing specified information and documents.

Note 7: - It is assumed that the mutual fund units are held as capital assets by the investors.

Note 8:- Under Section 115BAC w.e.f 01.04.2023, all individual, HUF, AOP, BOI is required to pay tax at concessional rates (as below) under the new tax regime subject to the condition that certain exemptions/ losses/ deductions cannot be claimed. In case such taxpayer intends to claim deductions / exemptions, it may elect to opt for existing tax and slabs rates to continue to apply.

73Securities Transaction Cost Equity Oriented Fund • 0.001% of Redemption Value on sale of units of an equity-oriented scheme to the mutual fund.

0.001% on Sale of Units of equity oriented mutual fund (Delivery Based) on recognized stock exchange.

For details on taxation please refer to the clause on Taxation in the SAI.

F. Rights of Unitholders- Please refer to SAI for details.

G. List of official points of acceptance: please refer the given link -

https://www.kotakmf.com/Information/statutory-disclosure/disclosuresrelatedtosidandkim H. Penalties, Pending Litigation or Proceedings, Findings of Inspections or Investigations For Which Action May Have Been Taken Or Is In The Process Of Being Taken By Any Regulatory Authority < S.O 48, 49> The detailed data in respect of penalties, pending litigations, findings of inspection or investigation is

available at https://www.kotakmf.com/Information/statutory-disclosure/disclosuresrelatedtosidandkim

Notes:

1. Further, any amendments / replacement / re-enactment of SEBI Regulations subsequent to the date of the Scheme Information Document shall prevail over those specified in this Document.

2. The Scheme under this Scheme Information Document was approved by the Trustees on June 27, 2025

3. The Trustees have ensured that Kotak Yield Fund approved by them is a new product offered by Kotak Mahindra Mutual Fund and is not a minor modification of any existing scheme/fund/product. < S.O 66>

4. Notwithstanding anything contained in the Scheme Information Document, the provisions of the SEBI (Mutual Funds) Regulations, 1996 and the guidelines there under shall be applicable. < S.O 63> For and on behalf of the Board of Directors, Kotak Mahindra Asset Management Company Limited (Investment Manager of Kotak Mahindra Mutual Fund) Sd/-

Place: Mumbai Ms. Jolly Bhatt

Date: August 11, 2025 Compliance Officer 74