Zerodha Nifty Short Duration G-Sec Index Fund

Draft Scheme Information Document (SID) Zerodha Nifty Short Duration G-Sec Index Fund (An open-ended scheme replicating/tracking the Nifty Short Duration G-Sec Index. A Moderate Interest Rate Risk and Relatively Low Credit Risk)Draft Scheme Information Document SECTION - I Zerodha Nifty Short Duration G-Sec Index Fund (An open-ended scheme replicating/tracking the Nifty Short Duration G-Sec Index. A Moderate Interest Rate Risk and Relatively Low Credit Risk) (Consolidated Std. Obs. 1) This product is suitable for investors Risk-o-meter of the Scheme Risk-o-meter of the Benchmark who are seeking*: (Consolidated Std. Obs. 3) (Nifty Short Duration G-Sec Index TRI) Short Duration Income Investment in securities in line with Nifty Short Duration G-Sec Index to generate comparable returns subject to tracking error Investors should understand that their principal will be at Low to Moderate Risk. *Investors should consult their financial advisers if in doubt about whether the product is suitable for them. Potential Risk Class (ʻPRC”) Matrix of the Scheme (Consolidated Std. Obs. 2 & 4) As per SEBI Circular dated, June, 07, 2021, the potential risk class matrix based on interest rate risk and credit risk, is as below: ➡ Credit Risk Relatively Low Moderate Relatively High (Class A) (Class B) Class (Class C) ⬇ Interest Rate Risk Relatively Low (Class I) Moderate (Class II) A-II Relatively High Class (Class III) The 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 actual investments are made. (Offer for face value of ₹ 1000/- per unit during New Fund Offer and at continuous offer for units at NAV based prices) Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 2⏺ New Fund Offer opens on ⏺ New Fund Offer closes on Scheme reopens on Scheme will reopen for continuous Sale and Repurchase within 05 Business Days from the date of allotment of units under NFO Name of Sponsor Zerodha Broking Limited Name of Mutual Fund Zerodha Mutual Fund Name of Asset Management Company Zerodha Asset Management Private Limited Name of Trustee Company Zerodha Trustee Private Limited Address Indiqube Penta, New No. 51 (Old No. 14), Richmond Road, Bangalore - 560 025 Website www.zerodhafundhouse.com The particulars of the Scheme have been prepared in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations 1996, (hereinafter referred to as ʻSEBI (MF) Regulationsʼ) as amended till date, and 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 SID 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 SID after the date of this Document from the Mutual Fund or its Website. The investors are advised to refer to the Statement of Additional Information (SAI) for details of Zerodha Mutual Fund, Standard Risk Factors, Special Considerations, Tax and Legal issues and general information on www.zerodhafundhouse.com. SAI is incorporated by reference (is legally a part of the Scheme Information Document). For a free copy of the SAI, please visit our website or send email to support@zerodhafundhouse.com. The SID should be read in conjunction with the SAI and not in isolation. The Scheme Information Document is dated November 20, 2025. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 3TABLE OF CONTENTS Particulars Page no. SECTION I I. Highlights/Summary of the Scheme 6-19 Due Diligence by Asset Management Company 20 II. Information about the scheme 21 - 28 A. How will the scheme allocate its assets? 21-23 B. Where will the scheme invest? 24 C. What are the investment strategies? 24-25 D. How will the scheme benchmark its performance? 25 E. Who manages the scheme? 25-26 F. How Is The Scheme Different From Existing Schemes Of The Mutual Fund? 26-27 G. How has the scheme performed? 27 H. Additional Schemes Related Disclosures 27-28 III. Other Details 29-34 A. Computation of NAV 29-30 B. New Fund Offer Expenses 30 C. Annual Scheme Recurring Expenses 30-33 D. Load Structure 33-34 SECTION II I. Introduction 35-41 A. Definitions/Interpretations 35 B. Risk Factors 35-40 C. Risk Mitigation Strategies 40-41 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 4II. Information about the Scheme 41-58 A. Where will the Scheme Invest 41-43 B. What are the investment restrictions? 43-46 C. Fundamental Attributes 46-47 D. Index methodology 47-48 E. Principles of incentive structure for market makers 48 F. Floors and ceiling within a range of 5% of the intended allocation against each 48 sub class of asset, as per clause 13.6.2 of SEBI master circular for mutual funds dated June 27, 2024. G. Other Scheme Specific Disclosures 49-58 III. Other Details 58-63 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 5Section I I. HIGHLIGHTS OF THE SCHEME Name of the Zerodha Nifty Short Duration G-Sec Index Fund Scheme Category of Scheme Other Schemes - Index Funds Type of Scheme An open-ended scheme replicating/tracking the Nifty Short Duration G-Sec Index. A Moderate Interest Rate Risk and Relatively Low Credit Risk. ⏺ Scheme Code (Consolidated Std. Obs. 7) Investment The primary goal is to provide returns that, before expenses, align with the total Objective returns of the securities constituting the Nifty Short Duration G-Sec Index, subject to tracking error. There is no assurance or guarantee that the investment objective of the scheme would be achieved. (Consolidated Std. Obs. 5) Liquidity On an ongoing basis, the subscription and redemption shall be at NAV based prices on all Business Days. The Fund shall dispatch proceeds of redemption within 03 working days of receiving the valid redemption request. As per SEBI (MF) Regulations, the Mutual Fund shall dispatch redemption proceeds within 03 Business Days from the date of redemption. A penal interest of 15% p.a. or such other rate as may be prescribed by SEBI from time to time, will be paid by the AMC in case the redemption proceeds are not dispatched within 03 Business Days from the date of redemption. Benchmark Nifty Short Duration G-Sec Index TRI The above Index has been chosen as the benchmark since the Scheme will invest in stocks which are constituents of Nifty Short Duration G-Sec Index. Thus, the aforesaid benchmark is such that it is most suited for comparing the performance of the Scheme. Transparency/ NAV The NAV will be calculated by the AMC for each Business Day except in special Disclosure circumstances. (Standard Observation 17(a)) AMC shall disclose the NAV for each Business Day as below: Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 61. On the website of the Fund/AMC - 11.00 P.M. of every business day. 2. On the website of Association of Mutual Funds in India (AMFI) - 11.00 P.M. of every business day. Please refer to page no. 60 of Section II for details. Applicable Timelines for Dispatch of redemption proceeds: Timelines As per SEBI (MF) Regulations, the Mutual Fund shall dispatch the redemption or repurchase proceeds to the unitholders within 03 working days from the date of redemption or repurchase. The AMC shall adhere to guidelines published by AMFI/SEBI for exceptional circumstances under which the scheme is unable to transfer redemption or repurchase proceeds within prescribed timelines. Plans and Options The scheme offers only Direct Plan. Plans/Options and The scheme offers only Growth Option. sub options under the Scheme The Trustees/ AMC reserves the right to introduce further Plan/ Options as and when deemed fit, subject to the SEBI (MF) Regulations. For detailed disclosure on default plans and options, kindly refer to SAI. Load Structure Exit Load: Nil The Trustee reserves the right to change/ modify the Load structure of the Scheme, subject to maximum limits as prescribed under the Regulations. For further details on load structure refer to the section ʻLoad Structureʼ on page no. 33 to 34. Minimum During NFO: Application Amount /Switch In ₹ 100 and in multiples of ʻany amountʼ thereafter. During Ongoing offer period: Investors can invest under the Scheme during the ongoing offer period with a minimum investment of ₹100 and in multiples of ʻany amountʼ thereafter. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 7Minimum Additional During the ongoing offer period, for subsequent additional purchases, the investor Purchase Amount can invest with the minimum amount of ₹100 and in multiples of ʻany amountʼ thereafter. The AMC/ Trustee reserves the right to change/ modify the terms of minimum purchase amount provision offered under the Scheme of the Fund. Minimum The minimum redemption amount shall be ʻany amountʼ or ʻany number of unitsʼ as Redemption/Switch requested by the investor at the time of redemption. Out Amount The redemption would be permitted to the extent of credit balance in the Unit holderʼs account of the Scheme (subject to completion of Lock-in period or release of pledge / lien or other encumbrances). The Redemption request can be made by specifying the rupee amount or by specifying the number of Units to be redeemed. The AMC/ Trustee reserves the right to change/ modify the terms of minimum redemption amount provision offered under the Scheme of the Fund. Tracking Error “Tracking Error” is defined as the standard deviation of the difference between daily total returns of the underlying index and the NAV of the Scheme. Thus, TE is the extent to which the NAV of the Scheme moves in a manner inconsistent with the movements of the Schemeʼs benchmark index on any given day or over any given period of time due to any cause or reason whatsoever including but not limited to expenditure incurred by the Scheme, dividend payouts if any, whole cash not invested at all times as the Scheme may keep a portion of funds in cash to meet redemption etc. Regular Plan Direct Plan Not Applicable, since the scheme offers Not Available, since this is a new only Direct Plan. Scheme. Tracking “Tracking Difference” is defined as the annualized difference of daily returns between Difference the benchmark index price and the NAV of the Scheme. Regular Plan Direct Plan Not Applicable, since the scheme offers Not Available, since this is a new only Direct Plan. Scheme. ⏺ New Fund Offer NFO Opens on: (NFO) Period ⏺ NFO Closes on: This is the period during which a new Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 8scheme sells its units NFO Period for the scheme will be announced at the time of the launch subject to the to the investors. earlier closure, if any; such offer period not being more than 15 days. In case the NFO Opening/ Closing Date is subsequently declared as a non-Business Day, the following Business Day will be deemed to be the NFO Opening/ Closing Date. Any modification to the New Fund Offer Period shall be announced by way of an Addendum uploaded on the website of the AMC. (Consolidated Std. Obs. 34) The Trustees/ AMC reserves the right to close the NFO before the above-mentioned date by giving notice as per the norms provided under SEBI (MF) Regulations. New Fund Offer ₹1000/- per unit during the NFO. (NFO) Price (This is the price per Unit that the investors have to pay to invest in NFO) Segregated The Scheme has provided enabling provisions for Creation of Segregated Portfolio in portfolio/ side terms of guidelines issued by SEBI from time to time. pocketing disclosure Please refer to the SAI for the details. (Consolidated Std. Obs. 53) Swing pricing Swing Pricing Framework is Not Applicable for the Scheme. disclosure Please refer to the SAI for more details. Stock lending/short The Scheme does not intend to participate in stock lending and short selling. selling Please refer to the SAI for more details. How to Apply and Investors can submit the application for purchase and redemption transactions in other details the schemes of Zerodha Mutual Fund at the Official Points of Acceptance (OPA). The list of OPA is available on the website of AMC i.e., www.zerodhafundhouse.com The investor may also reach out to the investor support email id support@zerodhafundhouse.com for details/ help in investing. Please refer to Page no. 53 of Section II for more details. Investor Services For General service requests Investors can lodge any service request or complaints or enquire about NAVs, Unit Holdings, etc. by sending an email to support@zerodhafundhouse.com. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 9The investor service representatives may seek certain personal information from the investor solely for the purpose of verifying his/her identity and safeguarding the confidentiality of account-related information. The AMC will at all times endeavour to handle transactions efficiently and to resolve any investor grievances promptly. For Complaint Resolution Any complaints should be addressed to the Investor Relations Officer. Address: Investor Relations Officer Zerodha Asset Management Private Limited New No.51, IndiQube Penta, 2nd Floor, Richmond Road, Bangalore - 560025 Email - iro@zerodhafundhouse.com For any grievances with respect to transactions through BSE StAR/ NMF/ MFSS, the investors / Unit Holders should approach either the stockbroker or the investor grievance cell of the stock exchange. Investors may escalate to the Compliance Officer at compliance@zerodhafundhouse.com and/ or CEO at ceo@zerodhafundhouse.com if they do not receive a response/ not satisfied with the response from the Investor Relations Officer. Specific Attributes Not Applicable. of the Scheme Special During NFO product/facility available during the SYSTEMATIC INVESTMENT PLAN (SIP) NFO and on ongoing basis Unit holders can enroll for the SIP facility at the OPA providing this facility during the NFO. An investor if choosing 29th, 30th or 31st of a month as the SIP date, then the SIP date will be automatically considered as the first business day of the following month. Minimum amount per SIP installment and Minimum number of installments under monthly and quarterly frequency of SIP are as follows: Frequency under SIP Minimum Installment Minimum Amount Facility Daily 01 ₹100 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 10Weekly 01 ₹100 Fortnightly 01 ₹100 Monthly 01 ₹100 Quarterly 01 ₹100 Half-yearly 01 ₹100 Yearly 01 ₹100 If the SIP period whenever asked for is not specified by the unit holder, then the SIP enrolment will be deemed to be for perpetuity and processed accordingly. In case of SIP investments, where the entire installment amount is not available in the bank account, the SIP for that month would be rejected. Allocation to a particular scheme or pro–rata allocation to schemes will not be carried out. Investors may register for SIP through One Time Mandate (OTM) for payment towards any future purchase transactions. Investors may choose any mode such as NACH/ECS/DIRECT DEBIT/ Standing Instruction (SI)/ UPI mandate as per arrangements with banks or payment aggregators. For online transactions, AMC may provide various payment modes, as available from time to time for SIP Enrolments. The SIP registration will be discontinued or considered as closed/ cancelled by the AMC as per the below mentioned timelines: SIP Interval No. of failed attempts prior to cancellations of SIPs Daily 3 Weekly 3 Fortnightly 3 Monthly 3 Quarterly 2 Halfyearly 2 Yearly 2 The AMC/RTA shall send a communication to the investor after 1st failed debit attempt, mentioning that the SIP will cease in case of aforesaid. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 11Units will be allotted at the Applicable NAV on SIP installment realization basis. In case the date falls on a Non-Business Day, the immediate next Business Day will be considered for this purpose. In case the fund is realized on non-business day of the scheme, the immediate next Business Day will be considered for this purpose. The AMC/ Trustee reserves the right to change / modify the terms and conditions of the SIP facility during the NFO period. During Ongoing Offer SYSTEMATIC INVESTMENT PLAN (SIP) Unit holders can enroll for the SIP facility at the OPA. An investor if choosing 29th, 30th or 31st of a month as the SIP date, then the SIP date will be automatically considered as the first business day of the following month. Minimum amount per SIP installment and Minimum number of installments under monthly and quarterly frequency of SIP are as follows: Frequency under SIP Minimum Installment Minimum Amount Facility Daily 01 ₹100 Weekly 01 ₹100 Fortnightly 01 ₹100 Monthly 01 ₹100 Quarterly 01 ₹100 Half-yearly 01 ₹100 Yearly 01 ₹100 If the SIP period whenever asked for is not specified by the unit holder, then the SIP enrolment will be deemed to be for perpetuity and processed accordingly. In case of SIP investments, where the entire installment amount is not available in the bank account, the SIP for that month would be rejected. Allocation to a particular scheme or pro–rata allocation to schemes will not be carried out. Investors may register for SIP through One Time Mandate (OTM) for payment towards any future purchase transactions. Investors may choose any mode such as NACH/ECS/DIRECT DEBIT/ Standing Instruction (SI)/ UPI mandate as per arrangements with banks or payment aggregators. For online transactions, AMC may provide various payment modes, as available from time to time for SIP Enrolments. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 12The SIP registration will be discontinued or considered as closed/ cancelled by the AMC as per the below mentioned timelines: SIP Interval No. of failed attempts prior to cancellations of SIPs Daily 3 Weekly 3 Fortnightly 3 Monthly 3 Quarterly 2 Halfyearly 2 Yearly 2 The AMC/RTA shall send a communication to the investor after 1st failed debit attempt, mentioning that the SIP will cease in case of aforesaid. Units will be allotted at the Applicable NAV on SIP installment realization basis. In case the date falls on a Non-Business Day, the immediate next Business Day will be considered for this purpose. In case the fund is realized on non-business day of the scheme, the immediate next Business Day will be considered for this purpose. The AMC/ Trustee reserves the right to change / modify the terms and conditions under the SIP prospectively at a future date. SIP Top-up facility Investors may avail fixed SIP Top-up facility where they have an option to increase the amount of the SIP Installment by a fixed amount at predefined intervals. SIP Top-up facility shall be available for SIP Investments through any mode such as NACH/ECS/DIRECT DEBIT/ Standing Instruction (SI)/ UPI mandate as per arrangements with banks or payment aggregators. The Top-up amount should be in multiples of ₹1 only. Monthly and quarterly SIP offers top-up frequency at yearly intervals. An Illustration: How to calculate the SIP Top-up amount? SIP Period : 01-Jan-2023 to 01-Dec-2024 (2 Years) Monthly SIP Installment Amount : ₹ 2,000 SIP Date : 1st of every month (24 installments) Top-up Amount: ₹ 1,000 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 13Top-up Frequency: Yearly SIP Instalments shall be as follows: Installment From Date To Date Monthly SIP Top up Increased No. SIP amount amount in SIP amount in ₹ ₹ in ₹ 1 to 12 01-Jan-23 31-Dec-23 2,000 N.A. 2,000 13 to 24 01-Jan-24 31-Dec-24 2,000 1,000 3,000 Top-up cap option: Unit holders have an option to cap the SIP Top-up amount based on either a fixed predefined amount or date as detailed below: Top-up cap amount: Investor has an option to cap the SIP Top-up amount once the SIP installment (including Top-up amount) reaches a fixed predefined amount. Thereafter the SIP installment will remain constant till the end of SIP tenure. Top-up cap month-year: Investor has an option to provide an end date to the SIP Top-up amount. It is the date from which Top - up to the SIP installment amount will cease and the SIP installment will remain constant till the end of SIP tenure. If none of the above options for Top-up cap is selected by the investor, the SIP Top-up will continue as per the SIP end date and Top-up amount specified by the investor. Illustration 1: How to fix Top-up cap amount? SIP Period: 01-Jan-2023 to 01-Dec-2027 (5 Years) Monthly SIP Installment Amount: ₹ 2,000 SIP Date: 1st of every month (60 installments) Top-up Amount: ₹ 1,000 Top-up Frequency: Yearly Top-up cap amount (including SIP Installment): ₹ 5,000 Installment From Date To Date Monthly SIP Top up SIP No. SIP amount amount in installment in ₹ ₹ including Top up in ₹ (A) (B) (A+B) 1 to 12 01-Jan-23 31-Dec-23 2,000 N.A. 2,000 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 1413 to 24 01-Jan-24 31-Dec-24 2,000 1,000 3,000 25 to 36 01-Jan-25 31-Dec-25 3,000 1,000 4,000 37 to 48 01-Jan-26 31-Dec-26 4,000 1,000 5,000 49 to 60 01-Jan-27 31-Dec-27 5,000 N.A. 5,000 It may be seen in the above illustration that once the Topup cap amount (including the SIP installment) reaches ₹ 5,000, the SIP installment amount starting January 1, 2027 remains constant. Illustration 2: How to fix top-up cap month-year? SIP Period: 01-Jan-2023 to 01-Dec-2027 (5 Years) Monthly SIP Installment Amount: ₹ 2,000 SIP Date: 1st of every month (60 installments) Top-up Amount: ₹ 1,000 Top-up Frequency: Yearly Top-up cap month - year: 01-Jan-2026 SIP Instalments shall be as follows: Installment From Date To Date Monthly SIP Top up SIP No. SIP amount amount in installment in ₹ ₹ including Top up in ₹ (A) (B) (A+B) 1 to 12 01-Jan-23 31-Dec-23 2,000 N.A. 2,000 13 to 24 01-Jan-24 31-Dec-24 2,000 1,000 3,000 25 to 36 01-Jan-25 31-Dec-25 3,000 1,000 4,000 37 to 48 01-Jan-26 31-Dec-26 4,000 1,000 5,000 49 to 60 01-Jan-27 31-Dec-27 5,000 N.A. 5,000 It may be seen in the above illustration that after 1-Jan-2026 (the pre- defined Top up cap month-year), the SIP installment amount remains constant. The AMC / Trustee reserves the right to change the terms and conditions of this facility at a later date on a prospective basis. The AMC / Trustee reserves the right to withdraw the SIP Top-up facility. SIP PAUSE FACILITY Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 15The Fund offers Systematic Investment Plan (“SIP”) Pause facility (“the Facility”) for investors who wish to temporarily pause their SIP in the Schemes of the Fund. The terms and conditions of the Facility are as follows: 1. This Facility is available for SIPs with Monthly and Quarterly frequencies. 2. The maximum number of installments that can be paused using this facility are 3 (three) consecutive installments for SIPs registered with Monthly frequency and 1 (one) for SIPs registered with Quarterly frequency. Thereafter, automatically the balance SIP installments (as originally registered) will resume. 3. SIP pause requests should be submitted at least 15 days before the requested start date. 4. SIP Pause once registered cannot be cancelled. 5. The Investor understands and acknowledges that the SIP Pause facility is merely a transaction related facility offered by the Company; and the Investor unconditionally and irrevocably agrees that the AMC or Fund will not be liable for: (i) acting in good faith on any instructions received from the Investor; (ii) any force majeure events that are beyond the control of any person; and (iii) any error, default, delay or inability of the AMC or the Fund or its Agents to act on all or any of the instructions from the Investor. The Investor hereby assumes and undertakes the entire risk of using the Facility and agrees to take full responsibility for the same. The Trustee reserves the right to change / modify the terms and conditions of the Facility or withdraw the Facility. Systematic Transfer Plan (STP) STP is a facility given to the Unit holders to transfer sums on a periodic basis from one scheme to another schemes launched by the Mutual Fund from time to time by giving a single instruction. Investors can opt for the STP by investing a lump sum amount in one scheme of the fund and providing a standing instruction to transfer sums at regular intervals. Particulars Frequency Details Frequency and Transaction Daily Every Business Day Dates Weekly Fortnightly Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 16Monthly Minimum number of Daily ₹ 100/- each per transfer transfers and minimum amount per STP Weekly Fortnightly Monthly An investor if choosing 29th, 30th or 31st of a month as the STP date, then the STP date will be automatically considered as the first business day of the following month. If any STP transaction due date falls on a non-Business day, then the respective transactions will be processed on the immediately succeeding Business Day for both the schemes. Default Frequency - Monthly The Trustee/ AMC reserves the right to introduce STPs at any other frequencies or on any other dates as the AMC may feel appropriate from time to time. In the event such a day is a Holiday, the transfer would be affected on the next Business Day. Systematic Withdrawal Plan (SWP) Unit holders have the benefit of availing the choice of Systematic Withdrawal Plan (SWP). The SWP allows the Unit holder to withdraw a specified sum of money each month/quarter/ half-yearly/ yearly from his investments in the Schemes. SWP is ideal for investors seeking a regular inflow of funds for their needs. It is also ideally suited to retirees or individuals, who wish to invest lump sum and withdraw from the investment over a period of time. The amount thus withdrawn by redemption will be converted into Units at Applicable NAV and the number of Units so arrived at will be subtracted from the Units balance to the credit of that Unit holder. The Unit holder may avail of this Option, after the close of the New Fund Offer Period. Unit holders will have the option to change the amount or the period of withdrawals. The SWP may be terminated by a Unit holder and it will terminate automatically if all the Units are liquidated or withdrawn from the account or the holdings fall below Rs.100/- (subject to the Unit holder failing to invest sufficient funds to bring the value of their holdings to the minimum amount of ₹100/- after the completion of SWP, within 30 days after the balance shall have fallen below the minimum holdings) or upon the Mutual Fundʼs receipt of notification of death or incapacity of the first Unit holder. Default Option : Monthly option Minimum SWP installment size is ₹100/- and in multiples of ₹ 1 thereafter. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 17Switching Options Unit holders under the Scheme have the option to switch part or all of their Unit holdings in the Scheme to any other Scheme offered by the Mutual Fund from time to time. The Mutual Fund also provides the investors the flexibility to switch their investments from any other scheme(s) / plan (s) offered by the Mutual Fund to this Scheme. This option will be useful to Unit holders who wish to alter the allocation of their investment among the scheme(s) / plan(s) of the Mutual Fund in order to meet their changed investment needs. The Switch will be affected by way of a Redemption of Units from the Scheme at Applicable NAV, subject to Exit Load, if any and reinvestment of the Redemption proceeds into another Scheme offered by the Mutual Fund at Applicable NAV and accordingly the Switch must comply with the Redemption rules of the Switch out Scheme and the Subscription rules of the Switch in Scheme. OTM – ONE TIME MANDATE (ʻFACILITYʼ) OTM is a simple and convenient facility that enables the Unit holders to transact in the Schemes of the Fund by submitting OTM - One Time Mandate registration with the Fund through e-NACH or UPI autopay facility. It is a one - time registration process wherein the Unit holder(s) of the Scheme(s) of the Fund authorizes his / her bank to debit their account upto a certain specified limit per transaction, on request received from the Fund, as and when the transaction is undertaken by the Unit holder, without the need of submitting cheque or fund transfer letter with every transaction thereafter. This Facility is only available to Unit holder(s) of the Fund who have been assigned a folio number by the AMC. Unit Holder(s) are requested to note that the AMC reserves the right to amend the terms and conditions, or modify, or discontinue the Facility for existing as well as prospective investors at any time in future. Process for Investments made in the name of Minor through a Guardian Payment for investment shall be accepted from the bank account of the minor or from a joint account of the minor with the guardian only, else the transaction is liable to get rejected. Unit holders are requested to review the Bank Account registered in the folio and ensure that the registered Bank Mandate is in favour of minor or joint with registered guardian in folio. If the registered Bank Account is not in favour of minor or not joint with registered guardian, unit holders will be required to submit the change of bank mandate, where minor is also a bank account holder (either single or joint with registered guardian), before initiation any redemption transaction in the folio, else the transaction is liable to get rejected. For systematic transactions in a minorʼs folio, AMC will register standing instructions till the date of the minor attaining majority, though the instructions may be for a period Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 18beyond that date. 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 and updated bank account details. No further transactions shall be allowed till the status of the minor is changed to major. For further details with respect to the above mentioned products / facilities, kindly refer to SAI. Weblink Total Expense Ratio (TER):(Consolidated Std.Obs. 26) Please note that this is a new scheme. TER details shall be available from the first NAV date: The AMC/Mutual Fund shall disclose the Total Expense Ratio (TER) of the Scheme on a daily basis on its website viz. https://www.zerodhafundhouse.com/resources/disclosures/ Scheme Factsheet: Not applicable as the scheme is a new fund to be launched. The AMC on its website viz. https://www.zerodhafundhouse.com/resources/fund-documents will provide a Factsheet of the Scheme on a monthly basis, which contains details such as Fund size, Performance, NAV, etc. IMPORTANT Before investing, investors are requested to also ascertain about any further changes pertaining to scheme such as features, load structure etc. made to this Scheme Information Document by issue of addenda/notice after the date of this Document from the AMC/ Mutual Fund/ Website, etc. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 19F. DUE DILIGENCE BY THE ASSET MANAGEMENT COMPANY (Standard Observation 24) (Consolidated Std. Obs. 55) A Due Diligence Certificate duly signed by the Compliance Officer of Zerodha Asset Management Private Limited has been submitted to SEBI, which reads as follows: It is confirmed that: (i) This Draft Scheme Information Document submitted to SEBI is in accordance with the SEBI (Mutual Funds) Regulations, 1996 (“Regulations”)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 proposed 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 thereunder shall be applicable. (viii) The Trustees have ensured that the Zerodha Nifty Short Duration G-Sec Index Fund approved by them is a new product offered by Zerodha Mutual Fund and is not a minor modification of any existing scheme/fund/product. Place: Bengaluru Signed: Sd/- Date: November 20, 2025 Name: Chandra Bhushan Singh Designation: Head Legal & Compliance (Compliance Officer) Note: The due diligence certificate as stated above was submitted to the SEBI on November 20, 2025. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 20II. INFORMATION ABOUT THE SCHEME (Standard Observation 14) A. HOW WILL THE SCHEME ALLOCATE ITS ASSETS? Asset Allocation Under the normal circumstances, the asset allocation (% of Net Assets) of Schemeʼs portfolio will be as follows: Indicative allocations Instruments (% of total assets) Minimum Maximum Securities covered by Nifty Short Duration 95% 100% G-Sec Index Debt and Money market instruments*, 0% 5% cash and cash equivalents (Consolidated Std. Obs. 21) *Money market instruments include, but are not limited to Treasury Bills, Commercial Paper of Public Sector Undertakings and Private Sector Corporate Entities, Term Money, Tri-party repo, Certificates of Deposit of Scheduled Commercial Banks, Financial Institutions and Development Financial Institutions, Government securities with unexpired maturity of one year or less and other Money Market securities as may be permitted by SEBI / RBI from time to time and in the manner prescribed under the Regulations. A small portion of the net assets will be invested in Debt and money market instruments permitted by SEBI / RBI including call money market or in alternative investment for the call money market as may be provided by the RBI, to meet the liquidity requirements of the scheme. The Scheme does not intend to undertake/ invest/ engage in the following: (Consolidated Std. Obs. 18) S.No. Type of Instrument Percentage of Circular references exposure 1. Derivatives 2. Securitized Debt 3. Short selling of securities 4. Stock Lending and Borrowing The Scheme will not invest/engage in these instruments. 5. Repo in corporate debt 6. Unrated instruments (except TREPs/ Government Securities/ SDL / Repo in Government Securities); Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 217. Foreign securities/ADR/GDR 8. ReITs and InVITs 9. Instruments having Special Features as defined in SEBI Circular no. SEBI/HO/IMD/DF4/CIR/P/2021/032 dated March 10, 2021; 10. Credit Enhancements & Structured Obligations; and 11. Credit Default Swap transactions The cumulative gross exposure through government securities, repo transactions, money market instruments and such other securities/assets as may be permitted by the Board from time to time, subject to regulatory approvals if any, should not exceed 100% of the net assets of the scheme in terms of para 12.24 of the SEBI Master Circular for Mutual Funds dated June 27, 2024. (Consolidated Std. Obs. 17) However, cash or cash equivalents with residual maturity of less than 91 days may be treated as not creating any exposure in line with para 12.24 of the SEBI Master Circular for Mutual Funds dated June 27, 2024. Further, SEBI vide letter dated November 03, 2021 has clarified that Cash Equivalent shall consist of Government Securities, T-Bills and Repo on Government Securities. (Consolidated Std. Obs. 14) The net assets of the scheme will be invested in securities constituting the Nifty Short Duration G-Sec Index. The Scheme shall be considered to be replicating the underlying index, provided: i. The duration of the portfolio of Scheme replicates the duration of the underlying index within a maximum permissible deviation of +/- 10%. ii. ETFs/Index Funds replicating a Constant Maturity index may invest in securities with residual maturity within+/-10% of maturity range of the index. Portfolio Rebalancing (Consolidated Std. Obs. 22) As per SEBI Circular dated May 23, 2022, the Scheme shall be considered to be replicating the index if the duration of the portfolio of the Scheme replicates the duration of the underlying index within a maximum permissible deviation of +/- 10%. Post any transactions undertaken in the scheme portfolio, in order to meet the redemption and subscription obligations, it shall be ensured that replication of the portfolio with the index is maintained at all points of time, subject to permissible deviations. The Fund Manager would monitor the Tracking Error of the Scheme on an ongoing basis and would seek to minimise the Tracking Error to the maximum extent possible. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 22● In case of change in constituents of the index due to periodic review, the portfolio of the scheme shall be rebalanced within 7 calendar days. ● In case the rating of any security is downgraded to below the rating mandated in the index methodology (including downgrade to below investment grade), the portfolio can be rebalanced within 30 calendar days. ● In case the rating of any security is downgraded to below investment grade, the said security may be segregated in accordance with SEBI Circular No. SEBI/HO/IMD/DF2/CIR/P/2018/160 dated December 28, 2018 on “Creation of segregated portfolio in mutual fund schemes”. Change in Asset Allocation: The above mentioned investment pattern is indicative and subject to the SEBI (MF) Regulations, the asset allocation pattern indicated above may vary from time to time, on account of receipt of maturity proceeds, interest and/or receipt of subscription. As per SEBI Circular no. SEBI/HO/IMD/DF2/CIR/P/2021/024 dated March 04, 2021, the Fund Manager, may deviate from the above investment pattern for a short term period on defensive considerations. The same will be rebalanced within 7 calendar days and further action may be taken as specified under SEBI Circulars/ AMFI guidelines issued from time to time. Short term defensive consideration: (Consolidated Std. Obs. 23 & 24) Subject to SEBI circular no. SEBI/HO/IMD/DF2/CIR/P/2021/024 dated March 04, 2021 and circulars issued thereunder, 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. Such changes in the investment pattern will be rebalanced within 7 calendar days from the date of deviation and further action may be taken as specified under SEBI Circulars/ AMFI guidelines issued from time to time. Portfolio rebalancing in case of passive breach: In line with para 3.6.7 of SEBI Master Circular dated June 27, 2024, in case of change in constituents of the index due to periodic review, the portfolio of Scheme shall be rebalanced within 7 calendar days. Further, any transactions undertaken in the portfolio of Index Schemes to meet the redemption and subscription obligations shall be done ensuring that post such transactions replication of the portfolio with the index is maintained at all points of time. However, the portfolio will adhere to the overall investment objectives of the Scheme. However, the same will be rectified at the earliest opportunity as may be available, but not later than 7 calendar days, to minimize the tracking error. Timelines for deployment of Funds mobilized in a New Fund Offer (NFO) Pursuant to SEBI Circular dated February 27, 2025, the funds mobilized during the New Fund Offer (NFO) shall be deployed in accordance with the asset allocation pattern of the scheme within 30 business days from the date of allotment of units. In exceptional cases where the AMC is not able to deploy the funds within this period, shall provide an explanation, including details of the efforts made to deploy the funds, to the Investment Committee of the AMC. The Investment Committee may extend the deployment timeline by up to 30 business days and shall provide recommendations to ensure timely deployment in the future. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 23B. WHERE WILL THE SCHEME INVEST? (Standard Observation 15) (Consolidated Std. Obs. 29) The Scheme will invest its corpus in the below instruments: 1. Government of India Securities 2. Tri-Party Repo on Government Securities 3. T-bills/Repo & Reverse Repo 4. Other money market instruments* 5. Cash & Cash equivalents *Money market instruments include, but are not limited to Treasury Bills, Commercial Paper of Public Sector Undertakings and Private Sector Corporate Entities, Term Money, Tri-party repo, Certificates of Deposit of Scheduled Commercial Banks, Financial Institutions and Development Financial Institutions, Government securities with unexpired maturity of one year or less and other Money Market securities as may be permitted by SEBI / RBI from time to time and in the manner prescribed under the Regulations. Please refer to Section II in page no. 41 to 43 for more details on the above instruments. C. WHAT ARE THE INVESTMENT STRATEGIES? (Standard Observation 7)(Consolidated Std. Obs. 27 & 28) Zerodha Nifty Short Duration G-Sec Index Fund is an open-ended index fund that seeks to align its performance with that of the Nifty Short Duration G-Sec Index by adhering to a passive, index-based investment methodology. The Scheme aims to replicate the index by investing primarily in the Government Securities that comprise the benchmark, in approximately the same proportion. A minimum of 95% of the Schemeʼs total assets will be invested in securities forming part of the underlying index. The remaining portion may be allocated to debt and money market instruments to manage liquidity, cash flow needs, operational expenses, etc. As a passively managed product, the Scheme does not seek to outperform the index or adopt tactical allocation based on interest rate or macroeconomic views. There is no active security selection, and investment decisions are not influenced by short-term market movements or forecasts. Temporary deviations from the index composition may occur, particularly around reconstitution or rebalancing events. In such cases, the portfolio shall be rebalanced by AMC within 7 Business Days from the date of said deviation. Though every endeavour will be made to achieve the objective of the Scheme, the AMC/Sponsors/Trustee does not guarantee that the investment objective of the Scheme will be achieved. No guaranteed returns are being offered under the Scheme. 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 Debt Index Fund, it is expected that there would be a number of subscriptions and redemptions on a daily basis. Hence, it is difficult to estimate with any reasonable measure of accuracy, the likely turnover in the portfolio. Generally, turnover will depend upon the extent of purchase and redemption of units and the need to rebalance the portfolio on account of change in the composition of the underlying index, if any. The Scheme has no specific target relating to Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 24portfolio turnover. The effect of higher portfolio turnover could be higher brokerage and transaction costs (if any). Portfolio Turnover Ratio: Not Applicable D. HOW WILL SCHEME BENCHMARK ITS PERFORMANCE? (Standard Observation 9) The Benchmark for the Scheme is Nifty Short Duration G-Sec Index (Total Returns Index). The above Index has been chosen as the benchmark since the Scheme will invest in stocks which are constituents of Nifty Short Duration G-Sec Index. Thus, the aforesaid benchmark is such that it is most suited for comparing the performance of the Scheme. Please refer to the Section on Index Methodology at Page No. 47 to 48 for more details. E. WHO MANAGES THE SCHEME? (Standard Observation 10)(Consolidated Std. Obs. 33) The detail of the Fund Manager of the scheme is as follows: Name and Age Educational Experience Fund (s) Managed Qualification (in years) Kedarnath Mirajkar PGDBM - 20 years 1. Zerodha Nifty Finance LargeMidcap 250 Index Fund 43 Years Zerodha AMC - From “June 2022” 2. Zerodha ELSS TaxSaver Till date Nifty LargeMidcap 250 Index Fund Aditya Birla Sun Life AMC - April 3. Zerodha Nifty 1D Rate 2010 to June 2022 Liquid ETF 4. Zerodha Nifty Midcap 150 Fund Manager/ Dealer Passive - ETF December 2020 to June 2022 5. Zerodha Nifty 100 ETF Chief Manager - Risk 6. Zerodha Gold ETF Management November 2018 to (Co-Fund Manager) December 2020 Trade Operations 7. Zerodha Gold ETF FoF - April 2010 to Nov 2018 8. Zerodha Silver ETF 9. Zerodha Overnight Fund HDFC Bank (Custody 10. Zerodha Silver ETF FoF Department) August 2007 to 11. Zerodha Multi Asset March 2010 Passive FoF 12. Zerodha Nifty 8-13 Yr Bombay Dyeing - September G-Sec ETF 2005 to August 2007 13. Zerodha Nifty Smallcap 100 ETF 14. Zerodha Nifty 50 Index Fund Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 2515. Zerodha Nifty 50 ETF 16. Zerodha BSE SENSEX Index Fund F. HOW IS THE SCHEME DIFFERENT FROM EXISTING SCHEMES OF THE MUTUAL FUND? Below is the list of all existing schemes of Zerodha Mutual Fund: Scheme Name Type of Scheme Zerodha Nifty LargeMidcap 250 Index Fund An open-ended scheme replicating/ tracking Nifty LargeMidcap 250 Index. Zerodha ELSS Tax Saver Nifty LargeMidcap 250 An open-ended passive equity linked savings Index Fund scheme with a statutory lock-in period of 3 years and tax benefit replicating/ tracking Nifty LargeMidcap 250 Index. Zerodha Nifty 1D Rate Liquid ETF An open-ended Exchange Traded Fund replicating/ tracking Nifty 1D Rate Index. A relatively low interest rate risk and relatively low credit risk. Zerodha Gold ETF An open-ended scheme replicating/tracking domestic price of Physical Gold. Zerodha Nifty 100 ETF An open-ended scheme replicating/tracking Nifty 100 TRI. Zerodha Nifty Midcap 150 ETF An open-ended scheme replicating/tracking Nifty Midcap 150 TRI. Zerodha Gold ETF FoF An open ended fund of fund scheme investing in units of Gold ETF. Zerodha Silver ETF An open ended Exchange Traded Fund replicating/ tracking domestic prices of physical Silver. Zerodha Overnight Fund An open ended debt scheme investing in overnight securities. A Relatively Low Interest Rate Risk and Relatively Low Credit Risk. Zerodha Silver ETF FoF An open ended fund of fund scheme investing in units of Zerodha Silver ETF. Zerodha Multi Asset Passive FoF An open ended fund of fund scheme investing in units of Equity, Debt Index Funds/ ETFs and Commodity ETFs. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 26Zerodha Nifty 8-13 Yr G Sec ETF An open-ended scheme replicating/tracking the Nifty 8-13 Yr G-Sec Index. A Relatively High Interest Rate Risk and Relatively Low Credit Risk. Zerodha Nifty Smallcap 100 ETF An open-ended scheme replicating/tracking Nifty Smallcap 100 TRI. Zerodha Nifty 50 Index Fund An open-ended scheme replicating/ tracking Nifty 50 Index - TRI Zerodha Nifty 50 ETF An open-ended scheme replicating/ tracking Nifty 50 Index - TRI Zerodha BSE SENSEX Index Fund An open-ended scheme replicating/tracking BSE Sensex Index The detailed comparison of the above mentioned existing schemes is disclosed on the website of the AMC viz. https://www.zerodhafundhouse.com/resources/disclosures/. G. HOW HAS THE SCHEME PERFORMED? This is a new scheme and does not have any performance track record. H. ADDITIONAL SCHEMES RELATED DISCLOSURES I. Scheme Portfolio Holdings: Please visit the AMC/MF website viz.www.zerodhafundhouse.com/resources/disclosures for Top 10 holdings by issuer and the portfolio holdings statements of the scheme. ii. Disclosure of name and exposure to Top 7 issuers, stocks, groups and sectors: Please visit the AMC/MF website viz.www.zerodhafundhouse.com/resources/disclosures for details on names and exposure to Top 7 issuers, Groups and Sectors as a percentage of NAV. iii. Functional website link for Portfolio Disclosure - Fortnightly / Monthly/ Half Yearly: The Mutual Fund / AMC will disclose the portfolio (along with ISIN and other prescribed/ required details) of the Scheme in the prescribed format, on a fortnightly, monthly and on a half yearly basis on its website viz. www.zerodhafundhouse.com/resources/disclosures. iv. Portfolio Turnover Rate Not Applicable. v. Aggregate investment in the Scheme by Concerned Fund Manager(s): As the scheme is a new scheme, this disclosure requirement is not applicable. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 27For any other disclosure w.r.t investments by key personnel and AMC directors including regulatory provisions in this regard, kindly refer to SAI. vi. Investments of AMC in the Scheme (Standard Observation 1) (Consolidated Std.Obs. 58) In terms of sub-regulation 16(A) in Regulation 25 of SEBI (MF) Regulations read along with SEBI circular no. SEBI/ HO/IMD/IMD - IDOF5/P/CIR/2021/624 dated September 02, 2021 and AMFI Best Practice Guidelines Circular No.100 /2022 - 23 on ʻAlignment of interest of AMCs with the Unitholders of the Mutual Fund schemesʼ, the AMC shall invest such amounts in such schemes of the mutual fund, based on the risks associated with the schemes, as may be specified by the SEBI from time to time. However, as per the circular, ETFs, Index Funds, Overnight Funds, Funds of Funds (FoF) scheme(s) are exempted from the purview of the aforesaid circular. In line with SEBI Regulations and circulars issued by SEBI from time to time, the AMC may invest its own funds in the scheme(s). Further, the AMC shall not charge any fees on its investment in the Scheme (s), unless allowed to do so under SEBI Regulations in the future. [This space is left blank intentionally] Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 28III. OTHER DETAILS A. COMPUTATION OF NAV (Consolidated Std. Obs. 42) The Net Asset Value (NAV) per Unit of the Scheme will be computed by dividing the net assets of the Scheme by the number of Units outstanding under the Scheme on the valuation date. The Mutual Fund will value its investments according to the valuation norms, as specified in Schedule VIII of the SEBI (MF) Regulations, or such norms as may be specified by SEBI from time to time. In case of any conflict between the Principles of Fair Valuation and valuation guidelines specified by SEBI, the Principles of Fair Valuation shall prevail. NAV of Units of under the Scheme shall be calculated as shown below: NAV (₹) per Unit = Market or Fair Value of the Schemeʼs Investments + Current Assets - Current Liabilities and Provisions No. of Units outstanding under each Scheme The NAV of the Scheme will be calculated and disclosed at the close of every Business Day. The NAV of the Scheme will be calculated up to 4 decimal places. Methodology for calculation of sale and repurchase price. Pursuant to SEBI circular no. SEBI/HO/IMD/DF2/CIR/P/2018/92 dated June 05, 2018 on “Go Green Initiative in Mutual Funds”, the methodology of calculating the sale and repurchase price of units is explained with an illustration below: A) Sale Price: The Sale Price for a valid purchase will be the Applicable NAV of the respective Scheme i.e. Sale Price = Applicable NAV. For a valid purchase request of ₹ 10,000, where the applicable NAV is ₹ 10, the units will be allotted as below: Purchase Amount - ₹ 10,000 Applicable NAV - ₹ 10 No. of Units - 1,000 Units (Purchase Amount/Applicable NAV) Please note that the entry load has been abolished with effect from August 01, 2009 vide SEBI Circular no.SEBI/IMD/CIR No. 4/ 168230/09 dated August 01, 2009. Hence, Sale price is equal to the applicable NAV. B) Repurchase Price: Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 29The Repurchase Price for a valid repurchase will be the applicable NAV reduced by any exit load (say 1%, if redeemed before completion of 1 year). i.e. applicable NAV - (applicable NAV X applicable exit load) For a valid repurchase request where the applicable NAV is ₹ 10, the repurchase price will be as follows : Applicable NAV - ₹ 10 Exit Load - 1% = 10 - (10 X 1%) = 10 - (0.1) = ₹ 9.9 Therefore, for the repurchase for 1,000 units, the Investor will receive the proceeds as given below: No. Of Units - 1,000 Repurchase Price = ₹9.9 =1000 X 9.9 = ₹ 9,900 Note: Transaction charges and other charges/expenses, if any, borne by the investors have not been considered in the above illustration(s). The Mutual Fund will ensure that the Redemption Price will not be lower than 95% of the Applicable NAV provided that the difference between the Redemption Price and the Subscription /Purchase Price at any point in time shall not exceed the permitted limit as prescribed by SEBI from time to time, which is currently 5% calculated on the Subscription/ Purchase Price. The Purchase Price shall be at applicable NAV. (Standard Observation 17(b)) (Consolidated Std. Obs. 47) 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. kindly refer to SAI. B. NEW FUND OFFER (NFO) EXPENSES These expenses are incurred for the purpose of various activities related to the NFO like marketing and advertising, Brokerage, registrar expenses, printing and stationery, bank charges etc. The New Fund Offer expenses of the scheme will be borne by the AMC. C. ANNUAL SCHEME RECURRING EXPENSES These are the fees and expenses incurred for the Scheme. These expenses include but are not limited to Investment Management and Advisory Fee charged by the AMC, Registrar and Transfer Agents' fee, marketing and selling costs, listing fee, etc. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 30The AMC has estimated that the following expenses will be charged to the Scheme as permitted under Regulation 52 of SEBI (MF) Regulations. For the actual current expenses being charged, the investor should refer to the website of the Mutual Fund viz. www.zerodhafundhouse.com Expense Head % of daily net assets (estimated) (p.a.) Investment Management and Advisory Fees Upto 1.00% Audit fees/fees and expenses of trustees1 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 Cost related to Investor Communication Cost of fund transfer from one location to another Cost towards investor education and awareness2 Brokerage and Transaction cost over and above 0.12% and 0.05% on value of trades for cash and derivative market trades only GST on expenses other than Investment Management and Advisory Fees3 GST on brokerage and transaction cost3 Other Expenses Maximum Total Expense Ratio (TER) permissible under Regulation 52 (6)4 Upto 1.00% 1 Trustee Fees and Expenses In accordance with the Trust Deed constituting the Mutual Fund, the Trustee is entitled to receive, in addition to the reimbursement of all costs, charges, and expenses, a yearly fee of ₹ 1. Such fee shall be paid to the Trustee within seven working days of the end of every year. The Trustee may charge further expenses as permitted from time to time under the Trust Deed and SEBI (MF) Regulations. 2 Investor Education and Awareness initiatives (Consolidated Std. Obs. 43) As per Para F of the SEBI Circular No. CIR/IMD/DF/21/2012 dated September 13, 2012 read with SEBI Circular no. SEBI/HO/IMD/DOF2/P/CIR/2022/69 dated May 23, 2022, the AMC shall annually set apart at least 1 basis points p.a. (i.e. 0.01% p.a.) on daily net assets of the Plan(s) under the Scheme within the limits of total expenses prescribed under Regulation 52 of SEBI (MF) Regulations for investor education and awareness initiatives undertaken. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 313 Refer Point (3) below on GST on various expenses. 4 The expenses towards Investment Management and Advisory Fees under Regulation 52 (2) and the various sub-heads of recurring expenses mentioned under Regulation 52 (4) of SEBI (MF) Regulations are fungible in nature. Thus, there shall be no internal sub-limits within the expense ratio for expense heads mentioned under Regulation 52 (2) and (4) respectively. The purpose of the above table is to assist the Investor in understanding the various costs and expenses that an Investor in the Plan(s) under the Scheme will bear directly or indirectly. The figures in the table above are estimates. The actual expenses that can be charged to the Scheme will be subject to limits prescribed from time to time under the SEBI (MF) Regulations. GST As per Para B of the SEBI circular no. CIR/IMD/DF/21/2012 dated September 13, 2012, GST shall be charged as follows: - a. GST on investment management and advisory fees shall be charged to the Scheme in addition to the maximum limit of TER as prescribed in Regulation 52 (6) of the SEBI (MF) Regulations. b. GST on other than investment management and advisory fees, if any, shall be borne by the Scheme within the maximum limit of TER as prescribed in Regulation 52 (6) of the SEBI (MF) Regulations. c. GST on brokerage and transaction cost paid for execution of trade, if any, shall be within the limit prescribed under Regulation 52 of the SEBI (MF) Regulations. The total expenses of the Scheme including the Investment Management and Advisory Fee shall not exceed the limits stated in Regulation 52 of the SEBI (MF) Regulations. The mutual fund would update the current expense ratios on the website (www.zerodhafundhouse.com) at least three working days prior to the effective date of the change and update the TER under the Section titled “Statutory Disclosures” under the sub-section titled “Total Expense Ratio of Mutual Funds”. Illustration: Impact of Expense Ratio on Scheme's return (Consolidated Std. Obs. 44) Expense ratio, normally expressed as a percentage of Average Assets under Management, is calculated by dividing the permissible expenses under the Regulations by the average net assets. To further illustrate the above, for the Scheme under reference, suppose an Investor invested ₹ 10,000/- (after deduction of stamp duty) under the Direct Plan, the impact of 1% expenses charged will be as under: Particulars Direct Plan Amount invested at the beginning of the year 10,000 (Rs.) Returns before expenses (Rs.) 1,500 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 32Expenses (Rs.) 115 Returns after expenses at the end of the year 11,385 (Rs.) Returns (per annum in %) 13.85% Note(s): - The purpose of the above illustration is to purely explain the impact of expense ratio charged to the Plan(s) under the Scheme and should not be construed as providing any kind of investment advice or guarantee of returns on investments. - It is assumed that the expenses charged are evenly distributed throughout the year. - Calculations are based on assumed NAVs, and actual returns on your investment may be more, or less. - Any tax impact has not been considered in the above example, in view of the individual nature of the tax implications. Each investor is advised to seek appropriate advice. All scheme related expenses including commission paid to distributors, by whatever name it may be called and in whatever manner it may be paid, shall necessarily paid from the scheme only within the regulatory limits and not from the books of AMC, its associate, sponsor, trustees or any other entity through any route in terms of SEBI circulars, subject to the clarifications provided by SEBI to AMFI vide letter dated February 21, 2019 on implementation of SEBI Circular dated October 22, 2018 on Total Expense Ratio (TER) and performance disclosure for Mutual Fund. D. LOAD STRUCTURE (Consolidated Std. Obs. 47) 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 the AMC (www.zerodhafundhouse.com). Details of Load Structure: Type of Load Load Chargeable (% of NAV) Exit / Redemption Load Nil The Trustee / AMC reserves the right to modify / change the Load structure if it so deems fit in the interest of smooth and efficient functioning of the Mutual Fund. Any imposition or enhancement of Exit Load in the load shall be applicable on prospective investments only. At the time of changing the load structure the AMC / Mutual Fund may adopt the following procedure: (Standard Observation 16) (i) The addendum detailing the changes will be attached to Scheme Information Document and Key Information Memorandum and displayed on our website www.zerodhafundhouse.com. (Standard Observation 16(i)) Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 33(ii) The introduction of the Load along with the details will be mentioned in the acknowledgement issued to the investors on submission of the application and will also be disclosed in the Account Statement or in the covering letter issued to the Unit holders after the introduction of such Load. (iii) A public notice shall be given in respect of such changes in one English daily newspaper having nationwide circulation as well as in a newspaper published in the language of the region where the Head Office of the Mutual Fund is situated. Any other measures which the mutual fund may feel necessary. (Standard Observation 16(iii)) (iv) Any other measures which the mutual fund may feel necessary. (Standard Observation 16(iv)) [This space is left blank intentionally] Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 34SECTION - II I. Introduction A. Definitions/Interpretations In this Scheme Information Document, the words and expressions shall have the meaning specified in the following link, unless the context otherwise requires. https://www.zerodhafundhouse.com/resources/disclosures/ B. Risk Factors (Standard Observation 2) (Consolidated Std. Obs. 8) Standard Risk Factors - Investment in Mutual Fund Units 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 securities in which the Scheme invests fluctuates, the value of your investment in the Scheme may go up or down depending on the various factors and forces affecting the capital markets and money markets. - Past performance of the Sponsors and their affiliates / AMC / Mutual Fund does not guarantee future performance of the Scheme of the Mutual Fund. - The name of the Scheme does not in any manner indicate either the quality of the Scheme or its future prospects and returns. - The Sponsors are not responsible or liable for any loss resulting from the operation of the Scheme beyond the initial contribution of ₹1 lakh each made by them towards setting up the Fund. - The present Scheme is not a guaranteed or assured return Scheme. Scheme Specific Risk Factors The Scheme is subject to the specific risks that may adversely affect the Schemeʼs NAV, return and / or ability to meet its investment objective. The specific risk factors related to the Scheme include, but are not limited to the following: Risk specific to investing in securities forming part of Nifty Short Duration G-Sec Index: a. Zerodha Nifty Short Duration G-Sec Index Fund is a passively managed Fund i.e., the amount collected under the scheme is invested in securities comprising the underlying index in the same weightages as they have in the underlying index. b. The composition of the underlying index is subject to changes that may be affected periodically by the Index Service Provider. c. Performance of the underlying index will have a direct bearing on the performance of the scheme. d. The extent of the Tracking error may have an impact on the performance of the scheme. Tracking Error Risk: The Fund Manager would not be able to invest the entire corpus exactly in the same proportion as in the underlying index due to certain factors such as the fees and expenses of Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 35the respective scheme, corporate actions, cash balance, changes to the underlying index and regulatory policies which may affect AMCʼs ability to achieve close correlation with the underlying index of the scheme. The schemeʼs returns may therefore deviate from those of its underlying index. (Consolidated Std. Obs. 10) (Consolidated Std. Obs. 39) Tracking Difference Risk: The Fund Manager may not be able to invest the entire corpus exactly in the same proportion as in the underlying index or goods due to certain factors such as the fees and expenses of the scheme, corporate actions, cash balance, changes to the underlying index and regulatory policies which may affect AMCʼs ability to achieve close correlation with the underlying index of the scheme. The schemeʼs returns may therefore deviate from those of its underlying index. Tracking Difference is the Difference of returns between the Scheme and the Benchmark Index annualized over 1 year, 3 Year, 5 Year,10 year and Scheme Since Inception period. (Consolidated Std. Obs. 10) (Consolidated Std. Obs. 39) The fund manager will endeavour to limit the tracking difference over one-year period within 1.25%. In case the average annualized tracking difference over the 1-year period for Scheme is higher than 1.25%, the same will be brought to the notice of trustees with corrective actions taken by the AMC. However, there can be no assurance or guarantee that the Scheme will achieve any particular level of tracking error/ difference relative to performance of the Underlying Index. Tracking Difference shall be disclosed only if the scheme has completed 1 year period. The Tracking difference shall be disclosed on a monthly basis on the AMCʼs website viz. www.zerodhafundhouse.com and AMFI website www.amfiindia.com. Risks associated with Debt and Money Market Instruments or Fixed Income Securities Credit Risk: This is the risk associated with the issuer of a debenture/bond or a Money Market Instrument defaulting on coupon payments or in paying back the principal amount on maturity. Even when there is no default, the price of a security may change with expected changes in the credit rating of the issuer. It is to be noted here that a Government Security is a sovereign security and is the safest. Corporate bonds carry a higher amount of credit risk than Government Securities. Within corporate bonds also there are different levels of safety and a bond rated higher by a particular rating agency is safer than a bond rated lower by the same rating agency. 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 Government 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 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 36debentures, prices are influenced not only by the change in interest rates but also by credit rating of the security and liquidity thereof. However, debt securities in the scheme are intended to be held till maturity. For such securities held till maturity, there will not be any interest rate risk at the end of the tenure. Floating rate securities issued by a government 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 minimising interest rate risk on a portfolio. Liquidity Risk: The Indian debt market is such that a large percentage of the total traded volumes on particular days might be concentrated in a few securities. Traded volumes for particular securities differ significantly on a daily basis. Consequently, the scheme might have to incur a significant “impact cost” while transacting large volumes in a particular security. Reinvestment Risk: Investments in fixed income securities carry reinvestment risk as interest rates prevailing on the coupon payment or maturity dates may differ from the original coupon of the bond. Basis Risk: The underlying benchmark of a floating rate security or a swap might become less active or may cease to exist and thus may not be able to capture the exact interest rate movements. This may result in loss of value of the portfolio. Spread Risk: In a floating rate security the coupon is expressed in terms of a spread or mark up over the benchmark rate. During the tenure of the security this spread may move adversely or favourably leading to fluctuations in value of the portfolio. The yield of the underlying benchmark might not change, but the spread of the security over the underlying benchmark might increase leading to loss in value of the security. Risk of Rating Migration: It may be noted that the price of a rated security would be impacted with the change in rating and hence, there is risk associated with such migration. The following table illustrates the impact of change of rating on the price of a hypothetical ʻAAʼ rated security with a maturity period of 3 years, a coupon of 9.00% p.a. and a market value of ₹ 100. If it is downgraded to ʻAʼ category, which commands a market yield of, say, 10.00% p.a., its market value would drop to ₹ 97.51 (i.e. 2.49%) If the security is up-graded to ʻAAAʼ category which commands a market yield of, say, 8.00% p.a. its market value would increase to ₹ 102.58 (i.e. by 2.58%). 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 (% p.a.) Market Value (Rs.) Existing Rating of AA 9.00 100.00 If upgraded to AAA 8.00 102.58 If downgraded to A 10.00 97.51 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 37Counterparty and Settlement Risk: Counterparty and settlement risk is the probability that the other party may not fulfil its part of the deal and may default on the contractual obligations. This risk comprises credit and liquidity risk both. Corporate Bond Repo will be settled between two counterparties in the OTC segment unlike in the case of TREPS transactions where CCIL stands as central counterparty on all transactions (no settlement risk). Settlement risk in reverse repo will be mitigated by requiring the counterparty (entity borrowing funds from the Mutual Fund) to deliver the defined collateral in the account of the MF before the cash is lent to the counterparty. Further, the Mutual Fund will also have a limited universe of counterparties, but not limited to, comprising of Scheduled Commercial Banks, Primary Dealers, Mutual Funds and National Financial Institutions. Legislative Risk: Changes in government policy in general and changes in tax benefits applicable to Mutual Funds may impact the returns to investors in the scheme. Prepayment risk: Certain fixed income securities give an issuer the right to call back its securities before their maturity date, in periods of declining interest rates. The possibility of such prepayment may force the fund to reinvest the proceeds of such investments in securities offering lower yields, resulting in lower interest income for the fund. Different types of securities in which the scheme would invest as given in the SID carry different levels and types of risk. Accordingly the schemeʼs risk may increase or decrease depending upon its investment pattern. E.g. corporate bonds carry a higher amount of risk than Government securities. Further even among corporate bonds, bonds, which are AA rated, are comparatively more risky than bonds, which are AAA rated. Risks associated with investing in Tri Party Repo through CCIL (TREPS) The mutual fund is a constituent member of the securities segment and Tri-party Repo trade settlement of the Clearing Corporation of India (CCIL). All transactions of the mutual fund in government securities and in Tri-party Repo trades are settled centrally through the infrastructure and settlement systems provided by CCIL; thus, reducing the settlement and counterparty risks considerably for transactions in the said segments. CCIL maintains prefunded resources in all the clearing segments to cover potential losses arising from the default member. In the event of a clearing member failing to honour his settlement obligations, the default Fund is utilised to complete the settlement. The sequence in which the above resources are used is known as the “Default Waterfall”. As per the waterfall mechanism, after the defaulterʼs margins and the defaulterʼs contribution to the default fund have been appropriated, CCILʼs contribution is used to meet the losses. Post utilisation of CCILʼs contribution if there is a residual loss, it is appropriated from the default fund contributions of the non-defaulting members. 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 fund contribution is allowed to be used to meet the residual loss in case of default by the other clearing member (the defaulting member). Further, it may be noted that, CCIL periodically prescribes a list of securities eligible for contributions as collateral by members. Presently, all Central Government securities and Treasury bills are Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 38accepted as collateral by CCIL. The risk factors may undergo change in case the CCIL notifies securities other than Government of India securities as eligible for contribution as collateral. Risks associated with investing in Government of India Securities Interest rate risk: When interest rates rise, bond prices fall; conversely, when rates decline, bond prices rise. The longer the time to a bondʼs maturity, the greater will be its interest rate risk. Since the scheme would invest in government securities having shorter maturity, interest rate risk would remain but is substantially less compared to long-term G-Secs. Inflation risk: Inflation causes tomorrowʼs money to be worth less than todayʼs; in other words, it reduces the purchasing power of a bond investorʼs future interest payments and principal, collectively known as “cash flows.” Inflation also leads to higher interest rates, which in turn leads to lower bond prices. Legislative risk: The risk that a change in the tax code could affect the value of taxable or tax-exempt interest income. Liquidity risk: The risk that the fund may have difficulty finding a buyer when they want to sell and may be forced to sell at a significant discount to market value. Risk factors associated with processing of transactions through Stock Exchange Mechanism The trading mechanism introduced by the Stock Exchange(s) is configured to accept and process transactions for mutual fund Units in both Physical and Demat Form. The allotment and/or redemption of Units through NSE and/or BSE or any other authorised Stock Exchange(s), on any Business Day will depend upon the modalities of processing viz. collection of application form, order processing /settlement, etc. upon which the Fund has no control. Moreover, transactions conducted through the Stock Exchange mechanism shall be governed by the operating guidelines and directives issued by respective recognized Stock Exchange(s). Accordingly, there could be negative impacts to the investors such as delay or failure in allotment / redemption of units. The Fund and the AMC are not responsible for the negative impacts. Risks associated with segregated portfolio: The unit holders may note that no redemption and subscription shall be allowed in the segregated portfolio. However, in order to facilitate exit to unit holders in the segregated portfolio, the AMC shall enable listing of units of segregated portfolio on the recognized stock exchange. The risks associated in regard to the segregated portfolio are as follows: A. The investors holding units of the segregated portfolio may not be able to liquidate their holdings till the time of recovery of money from the issuer. B. The security comprising the segregated portfolio may not realise any value. C. Listing units of the segregated portfolio on a recognized stock exchange does not necessarily guarantee their liquidity. There may not be active trading of units of the segregated portfolio on the stock exchange. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 39D. The trading price of units on the stock exchange may be significantly lower than the prevailing Net Asset Value (NAV) of the segregated portfolio. E. Risk Mitigation Strategies (Consolidated Std. Obs. 9) The AMC incorporates necessary framework in place for risk mitigation at an enterprise level, and scheme level in accordance with the Risk Management Framework prescribed by the SEBI. The Risk Management division of the AMC is an independent division within the organisation. Internal risk thresholds are defined and judiciously monitored. Risk indicators on various parameters are computed and are monitored on a regular basis. The Risk Management Committee of the Board enables a dedicated focus on risk factors and the relevant risk mitigants from time to time. In addition, to minimise the major risks, the following measures are taken: Risk description Risk mitigation Government of India The Scheme seeks to mitigate risks by investing exclusively in Securities Government of India Securities forming part of the Nifty Short Duration G-Sec Index, which carry sovereign backing and therefore entail negligible credit and default risk. The short-duration nature of the underlying securities reduces sensitivity to interest-rate movements, while the high depth and transparency of the G-Sec market help minimise liquidity and execution risks. The indexʼs rules-based roll-down methodology provides diversification across eligible issuances and moderates reinvestment and concentration risks, thereby supporting efficient replication and lower tracking error. Debt and Money • Credit Risk: Management analysis will be used for identifying Market instruments company specific risks. Managementʼs past track record will also be studied. In order to assess financial risk a detailed assessment of the issuerʼs financial statements will be undertaken. • Price-Risk or Interest-Rate Risk: Securities invested in are short term in nature thereby mitigating the price volatility due to interest rate changes generally associated with long-term securities. • Basis Risk: Securities invested in are fixed rate securities and hence basis risk does not apply. This risk is generally associated with floating rate securities and has a higher bearing on long-term securities. • Spread Risk: Securities invested in are fixed rate securities and hence spread risk does not apply. This risk is generally associated with floating rate securities and has a higher bearing on long-term securities. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 40• Reinvestment Risk: Scheme will primarily invest in securities maturing below 91 days. Reinvestment risk becomes more prevalent in long-term securities and lower time to maturity reduces the impact for the scheme. • Liquidity Risk: The Scheme will primarily invest in TREPS, government securities, overnight funds and other money market instruments thereby limiting liquidity risk. The liquidity risk for government securities and money market instruments may be low. Segregated In such an eventuality it will be AMCʼs endeavour to realise the Portfolio segregated holding in the best interest of the investor at the earliest. Tracking Errors Over a short period, the Scheme may carry the risk of variance between portfolio composition and Benchmark. The objective of the Scheme is to track the performance of the Underlying Index over the same period, subject to tracking error. The Scheme would endeavour to maintain a low tracking error by actively aligning the portfolio in line with the Index. Risks associated with As a member of the securities segment and Tri Party repo segment, investing in Tri Party Repo maintenance of sufficient margin is a mandatory requirement. through CCIL (TREPS) CCIL monitors these on a real time basis and requests the participants to provide sufficient margin to enable the trades, etc. Also there are stringent conditions / requirements before registering any participants by CCIL in these segments. Since settlement is guaranteed the loss on this account could be minimal though there could be an opportunity loss. II. Information about the Scheme A. Where will the Scheme Invest (Standard Observation 15) (Consolidated Std. Obs. 13 and 29) Government of India Securities The Scheme will invest in securities which are constituents of Nifty Short Duration G-Sec Index. Debt and Money Market Instruments:(Standard Observation 12) Listed debt or money market securities, in accordance with seventh schedule to the SEBI (MF) Regulations, SEBI circular no. SEBI/HO/IMD/DF2/CIR/P/2019/104 dated October 01, 2019 and other guidelines/ circulars as may be amended from time to time. Tri-party repo (TREPS) Tri-party repo means a repo contract where a third entity (apart from the borrower and lender), called a TriParty Agent, acts as an intermediary between the two parties to the repo to facilitate Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 41services like collateral selection, payment and settlement, custody and management during the life of the transaction. TREPS facilitates borrowing and lending of funds, in a Tri-Party Repo arrangement. Certificate of Deposit (CD) of scheduled commercial banks and development financial Institutions Certificate of Deposit (CD) is a negotiable money market instrument issued by scheduled commercial banks and select all-India Financial Institutions that have been permitted by the RBI to raise short term resources. The maturity period of CDs issued by the Banks is between 7 days to one year. Commercial Paper (CP) Commercial Paper (CP) is an unsecured negotiable money market instrument issued in the form of a promissory note, generally issued by the corporates, primary dealers and All India Financial Institutions as an alternative source of short-term borrowings. CP is traded in the secondary market and can be freely bought and sold before maturity. Treasury Bill (T-Bill) Treasury Bills (T-Bills) are issued by the Government of India to meet their short-term borrowing requirements. T-Bills are generally issued for maturities of 7 days, 14 days, 91 days, 182 days and 364 days. Repo Repo (Repurchase Agreement) or Reverse Repo is a transaction in which two parties agree to sell and purchase the same security with an agreement to purchase or sell the same security at a mutually decided future date and price. The transaction results in collateralized borrowing or lending of funds. Presently in India, G-Secs, State Government securities and T-Bills are eligible for Repo/Reverse Repo. Securities created and issued by the Central and State Governments as may be permitted by RBI, securities guaranteed by the Central and State Governments (including but not limited to coupon bearing bonds, zero coupon bonds and treasury bills). State Government securities (popularly known as State Development Loans or SDLs) are issued by the respective State Government in coordination with the RBI. Non-convertible debentures and bonds Non-convertible debentures as well as bonds are securities issued by companies / Institutions promoted / owned by the Central or State Governments and statutory bodies which may or may not carry a Central/State Government guarantee, Public and private sector banks, all India Financial Institutions and Private Sector Companies. These instruments may be secured or unsecured against the assets of the Company and generally issued to meet the short term and long-term fund requirements. The Scheme may also invest in the non-convertible part of convertible debt securities. Floating rate debt instruments Floating rate debt instruments are instruments issued by Central / state governments, corporates, PSUs, etc. with interest rates that are reset periodically. Investment in Short Term Deposits Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 42Pending deployment of funds as per the investment objective of the Scheme, the Funds may be parked in short term deposits of the Scheduled Commercial Banks, subject to guidelines and limits specified by SEBI. The securities / instruments mentioned above and such other securities the Scheme is permitted to invest in could be listed, unlisted, privately placed, secured, unsecured, rated or unrated and of any maturity. The securities may be acquired through initial public offering (IPOs), secondary market, private placement, rights offers, negotiated deals. Further investments in debentures, bonds and other fixed income securities will be in instruments which have been assigned investment grade rating by the Credit Rating Agency. Investment in unrated debt instruments shall be subject to complying with the provisions of the Regulations and within the limit as specified in Schedule VII to the Regulations. Pursuant to SEBI Circular No. MFD/CIR/9/120/2000 dated November 24, 2000; the AMC may constitute committee(s) to approve proposals for investments in unrated debt instruments. The AMC Board and the Trustee shall approve the detailed parameters for such investments. However, in case any unrated debt security does not fall under the parameters, the prior approval of the Board of AMC and Trustee shall be sought. Investments in Debt and Money Market Instruments will be as per the limits specified in the asset allocation table(s) of the Scheme, subject to permissible limits laid under SEBI (MF) Regulations from time to time. For applicable regulatory investment limits please refer to below paragraph "What are the Investment Restrictions”. B. What are the investment restrictions? (Standard Observation 11) 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. 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. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 43The 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. Provided that above 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 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 SEBI from time to time. 1. The Scheme may invest in another scheme under the same AMC 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. 2. 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 up to 25% of the net assets. 3. 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. IST purchases would be allowed subject to the guidelines as specified in SEBI Circular SEBI/HO/IMD/DF4/CIR/P/2020/202 dated October 08, 2020.(Consolidated Std. Obs. 30) 5. 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 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. 6. 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 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. 7. The Mutual Fund shall enter into transactions relating to Government Securities only in dematerialised form. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 448. The mutual fund shall get the securities purchased / transferred in the name of the fund on account of the concerned scheme, where investments are intended to be of long term nature. 9. In accordance with the guidelines as stated under SEBI circular no. SEBI/HO/IMD/DF2/CIR/P/2019/104 dated October 01, 2019, 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. 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 rediscounting, usance bills, etc., that are generally not rated and for which separate investment norms or limits are not provided in SEBI (MF) Regulations 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. All such investments shall be made with the prior approval of the Board of AMC and the Board of trustees. 10. Pursuant to SEBI Circular no. SEBI/HO/IMD/DOF2/P/CIR/2022/69 dated May 23, 2022 replication of the Index by the Scheme shall be as follows: i. The duration of the portfolio of ETF/ Index Fund replicates the duration of the underlying index within a maximum permissible deviation of +/- 10%. ii. ETFs/Index Funds replicating a Constant Maturity index may invest in securities with residual maturity within +/- 10% of maturity range of the index. iii. In case of Target Maturity (or Target Date) ETFs/ Index Funds, the following norms for permissible deviation in duration shall apply: a) For portfolio with residual maturity of greater than 5 years: Either +/- 6 months or +/- 10% of duration, whichever is higher. b) For a portfolio with residual maturity of up to 5 years: Either +/- 3 months or +/- 10% of duration, whichever is higher. c) However, at no point of time, the residual maturity of any security forming part of the d) portfolio shall be beyond the target maturity date of the ETF/ Index Fund. iv. For an index based on G-Sec and SDLs, a single issuer limit shall not be applicable. The Scheme shall endeavour to follow the guidelines prescribed under SEBI Circular no. SEBI/HO/IMD/DOF2/P/CIR/2022/69 dated May 23, 2022 and circular issued thereunder from time to time. These investment restrictions shall be applicable at the time of investment. Changes, if any, do not have to be effected merely because, owing to appreciating or depreciations in value, or by reason of Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 45the receipt of any rights, bonuses or benefits in the nature of capital or of any Schemes of arrangement or for amalgamation, reconstruction or exchange, or at any repayment or redemption or other reason outside the control of the Fund, any such limits would thereby be breached. If these limits are exceeded for reasons beyond its control, AMC shall as soon as possible take appropriate corrective action, taking into account the interests of the Unit holders. In addition, certain investment parameters may be adopted internally by AMC, and amended from time to time, to ensure appropriate diversification / security for the Fund. The Trustee Company / AMC may alter these above stated limitations from time to time, and also 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 investment objective. As such all investments of the Scheme will be made in accordance with SEBI (MF) Regulations. The 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. Further, apart from the investment restrictions prescribed under SEBI (MF) Regulations, the Fund may follow any internal norms vis-à-vis restricting / limiting exposure to a particular scrip or sector, etc. (Standard Observation 13)(Consolidated Std. Obs. 19) C. Fundamental Attributes (Standard Observation 8) (Consolidated Std. Obs. 59) Following are the fundamental attributes of the Scheme, in terms of Regulation 18 (15A) of the SEBI (MF) Regulations: (i) Type of scheme: An open-ended scheme replicating/tracking the Nifty Short Duration G-Sec Index. A Moderate Interest Rate Risk and Relatively Low Credit Risk. (ii) Investment Objective: a) Main Objective - The primary goal is to provide returns that, before expenses, align with the total returns of the securities represented by the Nifty Short Duration G-Sec Index, subject to tracking error. b) Investment Pattern - Please refer to the section“How will the scheme allocate its assets?” (iii) Terms of Issue: a) Liquidity provisions such as listing, repurchase, redemption. Please refer to the section “Highlights/Summary of the Scheme.” b) Aggregate fees and expenses charged to the Scheme. Please refer, section “Annual Scheme Recurring Expenses.” c) Any safety net or guarantee provided - Not Applicable. Change in Fundamental Attributes: In accordance with Regulation 18 (15A) of the SEBI (MF) Regulations, the Trustee shall ensure that no change in the fundamental attributes of the Scheme and the Option thereunder or the trust or fee Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 46and expenses payable or any other change which would modify the Scheme and the Option thereunder and affect the interest of Unit holders is carried out by the AMC, unless it complies with sub-regulation (26) of Regulation 25 of the SEBI (MF) Regulations. Further, in accordance with Regulation 25 (26) of the SEBI (MF) Regulations, the AMC shall ensure that no change in the fundamental attributes of the Scheme or the trust or fee and expenses payable or any other change which would modify the Scheme and affect the interests of Unitholders shall be carried out unless: (i) A written communication about the proposed change is sent to each Unitholder and an advertisement is issued in one English daily newspaper having nationwide circulation as well as in a newspaper published in the language of the region where the Head Office of the Mutual Fund is situated; and (ii) 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. Index methodology The performance of the scheme will be benchmarked against the Nifty Short Duration G-Sec Index TRI. About the Index Nifty Short Duration G-Sec Index represents Government of India bonds with a 1 to 3-year Macaulay duration range. . Highlights ● The index has a base date of September 03, 2001 and a base value of 1000. ● The index is rebalanced and reconstituted on a monthly basis. ● Based on a well-defined, market relevant and rules-based framework, the index is a transparent and objective indicator of G-sec market performance. Index Constituents as on October 31, 2025: S.No. ISIN Issuer Maturity Coupon (%) Index Category Name date Weight 1. IN0020220037 SOVEREIGN 2027 7.38% 39.71 G-Sec 2. IN0020230010 SOVEREIGN 2028 7.06% 36.13 G-Sec 3. IN0020230101 SOVEREIGN 2028 7.37% 24.16 G-Sec Index Review : Monthly Index Service Provider Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 47NSE Indices Limited (NSE Indices), a subsidiary of NSE Strategic Investment Corporation Limited was set up in May 1998 to provide a variety of indices and index related services and products for the Indian capital markets. NSE Indices provides a broad range of services, products and professional index services. E. Principles of incentive structure for market makers (for ETFs) Not Applicable. F. Floors and ceiling within a range of 5% of the intended allocation against each sub class of asset, as per clause 13.6.2 of SEBI master circular for mutual funds dated June 27, 2024 (only for close ended debt schemes) Not Applicable. [This space is left blank intentionally] Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 48G. Other Scheme Specific Disclosures Listing and The Scheme is an open-ended equity Scheme under which Sale and Repurchase will transfer of units be made on a continuous basis and therefore listing on stock exchanges is not envisaged. Units held in Demat Form are freely transferable. Further, the units held in SoA (Statement of Accounts) mode can be transferred in a manner as prescribed by AMFI from time to time. This facility shall be available only through online mode via the transaction portals of our Registrar and Transfer Agent (i.e. CAMS) and the MF Central (as and when enabled), 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. The Stamp duty for transfer of units, if/where applicable, shall be payable by the transferor. Unitholders can refer https://digital.camsonline.com/transfer for more details and can follow the process available on website of our CAMS if intends to transfer their units in scenarios prescribed below: ● Surviving joint unitholder, who wants to add new joint holder(s) in the folio upon demise of one or more joint unitholder(s). ● 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. ● 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). ● Transfer to Siblings, ● Gifting of Units ● Transfer of units to the third party ● Addition / Deletion of the holder. Dematerialization The Unit holders would have an option to hold the Units in demat form or account of units statement (non-demat) form. The Applicant intending to hold Units in demat form (Consolidated will be required to have a beneficiary account with a Depository Participant (DP) of Std. Obs. 57) the NSDL/ CDSL and will be required to mention in the application form DP's Name, DP ID No. and Beneficiary Account No. with the DP at the time of purchasing Units. In case unitholders do not provide their Demat Account details, an Account Statement shall be sent to them. Such unitholders will not be able to purchase/redeem the units on the stock exchange. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 49Minimum Target The minimum target amount to be raised during the NFO Period shall be ₹ 10 Crores. amount (This is the minimum 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 Not Applicable Amount to be raised (if any) Dividend Policy Not Applicable (IDCW ) Allotment During continuous subscription of the Scheme, all applicants whose monies towards (Detailed purchase of Units have been realized by the Fund will receive a full and firm allotment procedure) of Units, provided also the applications are complete in all respects and are found to be in order. An allotment confirmation specifying the units allotted shall be sent by way of email and/or SMS within 05 Business Days of the receipt of valid application / transaction to the Unit holders registered e-mail address and/ or mobile number. Please refer to SAI for details. Refund If the application is rejected, the full amount will be refunded within 5 working days of closure of NFO. If refunded later than 5 working days @ 15% p.a. for a delay period will be paid and charged to the AMC. Who Can Invest The following persons are eligible and may apply for subscription to the Units of the Scheme provided they are not prohibited by any law/ Constitutive documents (This is an governing them: indicative list and you are requested 1. Resident adult individuals either singly or jointly (not exceeding three) or on to consult your an anyone or survivor basis; financial advisor Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 50to ascertain 2. Karta of Hindu Undivided Family (HUF); whether the scheme is suitable 3. Minor (as the first and the sole holder only) through a natural guardian (i.e. to your risk father or mother, as the case may be) or a court appointed legal guardian. profile) There shall not be any joint holding with minor investments. Further, all other requirements for investments by minor and process of transmission shall be followed in line with SEBI Master Circular dated June 27, 2024 read with SEBI Circular dated May 12, 2023 as amended from time to time. (Consolidated Std. Obs. 37) Note: For folios where the units are held on behalf of the minor, the account shall be frozen for operation by the guardian on the day the minor attains majority and no transactions shall be permitted till the requisite documents for changing the status of the account from 'minor' to 'major' are submitted. 4. Proprietorship in the name of Sole Proprietor; 5. Partnership Firms & Limited Liability Partnerships (LLPs); 6. Companies, Bodies Corporate, Public Sector Undertakings, Association of Persons (AOP) or Bodies of Individuals (BOI) and societies registered under the Societies Registration Act, 1860, Co-Operative Societies registered under the Co-Operative Societies Act, 1912; 7. Banks & Financial Institutions; 8. Mutual Funds/ Alternative Investment Funds registered with SEBI; 9. Religious and Charitable Trusts, Wakfs or endowments of private trusts (subject to receipt of necessary approvals as required) and Private trusts authorised to invest in mutual fund schemes under their trust deeds; 10. Non-resident Indians (NRIs)/Persons of Indian Origin residing abroad (PIO)/ Overseas Citizen of India (OCI) on repatriation basis or on non-repatriation basis; 11. Foreign Portfolio Investors (FPI) registered with SEBI in accordance with applicable laws; 12. Army, Air Force, Navy and other paramilitary units and bodies created by such institutions; 13. Scientific and Industrial Research Organizations; 14. Council of Scientific and Industrial Research, India; Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 5115. Multilateral Financial Institutions/ Bilateral Development Corporation Agencies/ Bodies Corporate incorporated outside India with the permission of Government of India/Reserve Bank of India; 16. Provident/ Pension/ Gratuity Fund to the extent they are permitted; 17. Qualified Foreign Investor (QFI); 18. Other Schemes of Zerodha Mutual Fund subject to the conditions and limits prescribed by SEBI (MF) Regulations; 19. Such other category of investors as may be decided by the AMC / Trustee from time to time provided their investment is in conformity with the applicable laws and SEBI (MF) Regulations. The list given above is indicative and the applicable laws, if any, as amended from time to time shall supersede the list. Who cannot 1. Any individual who is a foreign national or any other entity that is not an Indian invest resident under the Foreign Exchange Management Act, 1999 (FEMA Act) except where registered with SEBI as a FPI or otherwise explicitly permitted under FEMA Act/ by RBI/ by any other applicable authority; 2. Overseas Corporate Bodies (OCBs); 3. NRIs residing in Non-Compliant Countries and Territories (NCCTs) as determined by the Financial Action Task Force (FATF); 4. U.S. Persons and Residents of Canada as defined under the applicable laws of U.S. and Canada; 5. Such other persons as may be specified by AMC/ Trustee from time to time. How to Apply Investors can submit the application for purchase and redemption transactions in the and other details schemes of Zerodha Mutual Fund at the Official Points of Acceptance (OPA). (Consolidated Std. Obs. 35) Please refer to the SAI for the details. The Investor may also reach out to the investor support email id support@zerodhafundhouse.com for details/ help in investing. The list of OPA is available on the website of AMC i.e., www.zerodhafundhouse.com Please refer to Page no. 64 & 65 for Official Points of Acceptance, Registrar and Transfer Agent (RTA) and Collecting Banker details. As per the directives issued by SEBI, it is mandatory for applicants to mention their bank account numbers in their applications and therefore, investors are requested to Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 52fill-up the appropriate box in the application form failing which applications are liable to be rejected. Investors are required to mandatorily provide a valid and active email ID at the time of submitting the application form. The email ID provided will be used for all future communications including, but not limited to, the Statement of Account (SOA), transaction confirmations, and portfolio updates. In case a valid email ID is not provided, the investor may not receive such communications. Terms and conditions for transactions through email for non-individual investors Non Individual Investors desiring to avail the facility of conducting financial transactions in the Scheme(s) of Zerodha Mutual Fund via email as provided under AMFIʼs Best Practice Guidelines Circular No.135/BP/118 /2024-25 dated 31st January 2025, shall note the following: Terms and conditions for transactions through email: ● The AMC can accept financial transactions from non-individual investors through email, subject to the following: ● The non-individual investor must provide a copy of the board resolution or authority letter, as specified by the AMC, granting authority to designated officials. ● Transactions via emails, scanned copies of signed forms, or electronically executed documents with valid Digital Signature Certificates (DSC) or Aadhaar based e-signatures may be accepted as per the conditions specified in the aforementioned circular. ● Non Individual Investors should be aware of the risks associated with email transactions, including transmission errors and cyber security risks. The AMC/RTA shall not be liable in any manner whatsoever in case the transaction sent or purported to be sent by the investor is not received by the AMC/ RTA due to any reason and hence not processed. ● The non-individual investors must have necessary safeguards to ensure the security of email communications and retain transaction records as per applicable laws/regulations. ● Any addition/deletion of authorized signatories by the non-individual investors shall be done in the manner specified by the AMC. ● Any change in the registered email id/contact details shall be accepted only from the designated officials authorized to notify such changes vide board resolutions/authority letter. Further, such change request shall be submitted Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 53through physical request letter (or a scanned copy thereof with wet signature of the designated authorized officials) only. ● No change in /addition to the bank mandate shall be allowed via email. Change in bank details or addition of bank account of the investor shall be permitted only via the prescribed service request form duly signed by the investorʼs authorized signatories with wet signature of the designated authorized officials. ● The AMC will adopt security procedures, electronic time stamping mechanisms and audit trails for email transactions, as may be required. ● The AMC may specify additional terms and conditions for email transactions, and investors are advised to refer to the latest guidelines hosted on the AMC's website from time to time. The policy Presently, the AMC does not intend to reissue the repurchased Units. regarding reissue of repurchased However, the Trustee reserves the right to reissue the repurchased Units at a later units, including date after issuing adequate public notices and taking approvals, if any, from SEBI. the maximum extent, the manner of reissue, the entity (the scheme or the AMC) involved in the same. Restrictions, if The Units of the Scheme held in electronic (demat) mode are transferable. The Mutual any, on the right Fund at its sole discretion reserves the right to suspend sale and switching of Units in to freely retain or the Scheme temporarily or indefinitely when any of the following conditions exist. dispose of units However, the suspension of sale of Units either temporarily or indefinitely will be with being offered. the approval of the Trustee. a. When one or more stock exchanges or markets, which provide a basis for valuation for a substantial portion of the assets of the Scheme are closed otherwise than for ordinary holidays. b. When, as a result of political, economic or monetary events or any circumstances outside the control of the Trustee and the AMC, the disposal of the assets of the Scheme are not reasonable, or would not reasonably be practicable without being detrimental to the interests of the Unit holders. c. In the event of breakdown in the means of communication used for the valuation of investments of the Scheme, without which the value of the securities of the Scheme cannot be accurately calculated. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 54d. During periods of extreme volatility of markets, which in the opinion of the AMC are prejudicial to the interests of the Unit holders of the Scheme. e. In case of natural calamities, strikes, riots and bandhs. f. In the event of any force majeure or disaster that affects the normal functioning of the AMC. g. If so directed by SEBI. The AMC/ Trustee reserves the right in its sole discretion to withdraw the facility of Sale option of Units into the Scheme, temporarily or indefinitely, if AMC views that changing the size of the corpus further may prove detrimental to the existing Unit holders of the Scheme. Cut off timing for Subscriptions: subscriptions/ redemptions The following cut-off timings shall be observed by the Mutual Fund in respect of purchase of units of the Scheme and the following NAVs shall be applied for such This is the time purchase: before which your application Cut off timing for Subscriptions: (complete in all respects) should a. In respect of valid applications received upto 03.00 p.m on a Business Day and reach the official funds for the entire amount of subscription/purchase as per the application points of are credited to the bank account of the respective Scheme before the cut-off acceptance. time i.e. available for utilization before the cut-off time – the closing NAV of the day on which the funds are available for utilization shall be applicable. b. In respect of valid applications received after 03.00 p.m on a Business Day and funds for the entire amount of subscription/purchase as per the application are credited to the bank account of the respective Scheme after cut-off time i.e. available for utilization after the cut-off time – the closing NAV of the next Business Day on which the funds are available for utilization shall be applicable. c. Irrespective of the time of the receipt of valid application where funds for the entire amount of subscription/purchase as per the application are credited to the bank account of the respective Scheme before cut-off time of next business day i.e. available for utilization before the cut-off time on any subsequent Business day - the closing NAV of the day of such Business day on which the funds are available for utilization shall be applicable. Redemptions: The following cut-off timings shall be observed by the Mutual Fund in respect of Redemptions of Units: Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 551. Where the application received upto 03.00 pm – closing NAV of the day of receipt of application; and 2. An application received after 03.00 pm – closing NAV of the next Business Day. Note: In case the application is received on a Non-Business Day, it will be considered as if received on the Next Business Day. Minimum amount Minimum amount for purchase: for purchase/ ₹ 100 and in multiples of ʻany amountʼ thereafter. redemption Minimum Additional Purchase Amount: ₹ 100 and in multiples of ʻany amountʼ thereafter. Minimum Redemption Amount: The minimum redemption amount shall be ʻany amountʼ or ʻany number of unitsʼ as requested by the investor at the time of redemption. The Redemption would be permitted to the extent of credit balance in the Unit holderʼs account of the Scheme (subject to completion of Lock-in period or release of pledge / lien or other encumbrances). The Redemption request can be made by specifying the rupee amount or by specifying the number of Units to be redeemed. The AMC/ Trustee reserves the right to change/ modify the terms of minimum purchase/redemption amount provision offered under the Scheme of the Fund. Accounts The AMC shall send an allotment confirmation specifying the units allotted by way of Statements email and/or SMS within 5 working days of receipt of valid application/transaction to (Standard the Unit holders registered e-mail address and/ or mobile number (whether units are Observation 18) held in demat mode or in account statement form). (Consolidated Std. Obs. 60) 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 via electronic mode (e-CAS) by the twelfth (12th) day from the month end and to investors that have opted for delivery via physical mode by the fifteenth (15th) day from the month end. Half-yearly CAS shall be issued at the end of every six months (i.e. September/ March) to investors that have opted for e-CAS on or before the eighteenth (18th) day of April and October and to investors that have opted for delivery via physical mode by the twenty first (21st) day of April and October. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 56For further details, refer to SAI. Dividend/ IDCW Not Applicable 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 for Mutual Funds dated June 27, 2024. The redemption proceeds will be credited to the bank account of the Unitholder, as per the bank account details recorded with the DP. Units will be redeemed on First In First Out (FIFO) basis. Redemption requests may not be processed if KYC compliant status is not updated in the folio. Bank Mandate As per the directives issued by SEBI, it is mandatory for applicants to mention their (Standard bank account numbers in their applications and therefore, investors are requested to Observation 19) fill-up the appropriate box in the application form failing which applications are liable (Consolidated to be rejected. Std. Obs. 61) Multiple Bank Account Registration The AMC/ Mutual Fund provides a facility to the investors to register multiple bank accounts (currently upto 5 for Individuals and 10 for Non - Individuals) for receiving redemption by providing necessary details. Investors must specify any one account as the "Default Bank Account". The investor, may however, specify any other registered bank account for credit of redemption proceeds at the time of requesting for redemption. Change in Bank Account Investors may reach out to support@zerodhafundhouse.com for requesting a change in their Bank Account for folios held in Statement of Account (SOA) mode. The facility for change in Bank Account for the Units held in demat mode is available. The investors are requested to reach out to the respective Depository Participant. Delay in payment The AMC shall be liable to pay interest to the unitholders at rate as specified vide of redemption / clause 14.2 of SEBI Master Circular for Mutual Funds dated June 27, 2024 by SEBI for repurchase the period of such delay. proceeds/ dividend Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 57Unclaimed Please refer to SAI for details. Redemption (Consolidated Std. Obs. 52) Disclosure w.r.t Process for Investments made in the name of Minor through a Guardian investment by minors Payment for investment from the bank account of the minor or from a joint account of the minor with the guardian only, else the transaction is liable to get rejected. Unit holders are requested to review the Bank Account registered in the folio and ensure that the registered Bank Mandate is in favour of minor or joint with registered guardian in folio. If the registered Bank Account is not in favour of minor or not joint with registered guardian, unit holders will be required to submit the change of bank mandate, where minor is also a bank account holder (either single or joint with registered guardian), before initiation any redemption transaction in the folio, else the transaction is liable to get rejected. For systematic transactions in a minorʼs folio, AMC will register standing instructions till the date of the minor attaining majority, though the instructions may be for a period beyond that date. 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 and updated bank account details. No further transactions shall be allowed till the status of the minor is changed to major. Any other Minimum balance to be maintained and consequences of non- maintenance. disclosure in (Consolidated Std. Obs. 36) terms of Consolidated Currently, there is no minimum balance requirement. Checklist on Standard Scheme Summary Document (Consolidated Std. Obs. 38) Observations The AMC will provide on its website a standalone scheme document for all the Schemes which contains all the details of the Scheme viz. Scheme features, Fund Manager details, investment details, investment objective, expense ratios, portfolio details, etc. III. Other Details A. In case of Fund of Funds Scheme, Details of Benchmark, Investment Objective, Investment Strategy, TER, AUM, Year wise performance, Top 10 Holding/ link to Top 10 holding of the underlying fund should be provided Not Applicable. B. Periodic Disclosures such as Half yearly disclosures, half yearly results, annual report a. Annual Report Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 58Scheme Annual report in the format prescribed by SEBI, will be hosted on the website of the Fund viz. www.zerodhafundhouse.com and on the website of Association of Mutual Funds in India (AMFI) viz. www.amfiindia.com as soon as may be but not later than four months from the date of closure of the relevant accounts year (i.e. 31st March each year). Mutual Fund / AMC will publish an advertisement every year, in the all India edition of at least two daily newspapers, one each in English and Hindi, disclosing the hosting of the Scheme wise Annual Report on the website of the Fund and on the website of Association of Mutual Funds in India (AMFI). Mutual Fund / AMC will email the Scheme Annual Report or Abridged Summary thereof to the unitholders registered email address with the Mutual Fund. Mutual Fund / AMC will provide a physical copy of the abridged summary of the Annual Report, without charging any cost, on specific request received from a unitholder through any mode. A physical copy of the scheme wise annual report shall be made available for inspection to the investors at the registered office of the AMC. A link of the scheme annual report or abridged summary thereof shall be displayed prominently on the website of the Fund and shall also be displayed on the website of Association of Mutual Funds in India (AMFI). b. Half Yearly Results The Mutual Fund shall host half yearly disclosures of the Schemeʼsʼ unaudited financial results in the prescribed format on its website viz. www.zerodhafundhouse.com within one month from the close of each half year i.e. on 31st March and on 30th September and shall publish an advertisement in this regard in at least one English daily newspaper having nationwide circulation and in a newspaper having wide circulation published in the language of the region where the Head Office of the Mutual Fund is situated. c. Half Yearly Portfolio Statement The Mutual Fund/ AMC will disclose the portfolio (along with ISIN) of the Scheme, including Segregated Portfolio, if any, in the prescribed format, as on the last day of half-year i.e. March 31 and September 30, on its website viz. www.zerodhafundhouse.com and on the website of Association of Mutual Funds in India (AMFI) viz. www.amfiindia.com within 10 days from the close of each half-year respectively. The Mutual Fund / AMC will send via mail, to the registered email address of the unitholders, the half-yearly statement of scheme portfolio within 10 days from the close of each half-year respectively. Mutual Fund / AMC will publish an advertisement every half-year in an all India edition of at least two daily newspapers, one each in English and Hindi, disclosing the hosting of the half-yearly statement of the Scheme portfolio on its website and on the website of Association of Mutual Funds in India (AMFI). Mutual Fund / AMC will provide a physical copy of the statement of its Scheme portfolio, without charging any cost, on specific request received from a unitholder. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 59d. Disclosure of Risk-o-meter (Consolidated Std. Obs. 38) The risk-o-meter of the Scheme shall be evaluated on a monthly basis and shall be disclosed along with portfolio disclosure on the AMC website and on AMFI website within 10 days from the close of each month. Notice about changes in Scheme's Risk-o-meter, if any, shall be issued. The product labeling assigned during the NFO is based on internal assessment of the scheme characteristics and the same may vary post NFO when the actual investments are made. For latest Risk-o-meter of the Scheme and the Benchmark, investors may refer to the monthly portfolios disclosed on the website of the Fund viz. www.zerodhafundhouse.com. The risk level of the Scheme as on March 31 of every year, along with the number of times the risk level has changed over the year, shall be disclosed on the AMC website and AMFI website. The scheme wise changes in Risk-o-meter shall be disclosed in scheme wise Annual Reports and Abridged summary. C. Transparency/NAV Disclosure (Consolidated Std. Obs. 41) The NAV will be calculated by the AMC for each Business Day. The first NAV shall be calculated and declared within 05 business days from the date of allotment. As mandated by SEBI, the NAV shall be disclosed in the following manner: (i) Displayed on the website of Mutual Fund (www.zerodhafundhouse.com) (ii) Displayed on the website of Association of Mutual Funds in India (AMFI) (www.amfiindia.com) (iii) Any other manner as may be mandated by SEBI from time to time Mutual Fund/ AMC will provide facility of sending latest NAVs to unitholders through SMS, upon receiving specific requests. AMC shall update NAV on the website of the Fund and Association of Mutual Funds in India (AMFI) by 11.00 p.m. every Business Day. In case of any delay in uploading on AMFI website, the reason for such delay will be explained to AMFI in writing. If the NAVs are not available before commencement of business hours on the following day due to any reason, Mutual Fund shall issue a press release providing reasons and explaining when the Mutual Fund would be able to publish the NAVs. The AMC will make available the Annual Report of the Scheme within four months of the end of the financial year. D. Transaction charges and stamp duty Transaction Charges As the scheme is offering only the Direct Plan, no transaction charges will be levied or deducted. Please refer to SAI for details. Stamp Duty Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 60Pursuant to Notification No. S.O. 1226(E) and G.S.R. 226(E) dated March 30, 2020 issued by Department of Revenue, Ministry of Finance, Government of India, read with Part I of Chapter IV of Notification dated February 21, 2019 issued by Legislative Department, Ministry of Law and Justice, Government of India on the Finance Act, 2019, stamp duty @0.005% of the transaction value would be levied on applicable mutual fund transactions. Accordingly, pursuant to levy of stamp duty, the number of units allotted on purchase transactions to the unitholders would be reduced to that extent. Please refer to SAI for details. E. Associate Transactions Please refer to SAI for details. F. Taxation For details on taxation please refer to the clause on Taxation in the SAI apart from the following: This information is provided for general information only and is based on the prevailing tax laws, as applicable in case of this Scheme. However, in view of the individual nature of the implications, each investor is advised to consult his or her own tax advisors/ authorized dealers with respect to the specific amount of tax and other implications arising out of his or her participation in the schemes. Resident Foreign Non-Residen Mutual Fund Investors Institution t (other than al Investor FII) (FII) Tax on dividend NA NA NA NIL@ Capital gain Tax ( Normal tax Normal tax Normal tax NIL@ irrespective of the rates rates rates holding period)* applicable to applicable applicable to investor to investor investor @ The levy of tax on distributed income payable by mutual funds has been abolished w.e.f. April 1, 2020 and instead tax on income from mutual fund units in the hands of the unit holders at their applicable rates has been adopted. NA The Scheme does not have a dividend policy, hence not applicable * Surcharge and Health & Education Cess to be levied: If taxpayer (Individual/HUF/AOP/BOI/AJP) opts for Old Tax Regime, then Surcharge to be levied on basic tax at: • 37% where specified income exceeds Rs.5 crore; • 25% where specified income exceeds Rs.2 crore but does not exceed Rs.5 crore; Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 61• 15% where total income exceeds Rs.1 crore but does not exceed Rs.2 crore; and • 10% where total income exceeds Rs.50 lakhs but does not exceed Rs.1 crore. If the taxpayer (Individual/HUF/AOP/BOI/AJP) pays tax as per default New Tax Regime u/s. 115BAC(1A), then the maximum rate of Surcharge will be 25% where income exceeds Rs.2 crore. In case of an AOP consisting of only companies as its members, the rate of surcharge shall not exceed 15%. Surcharge for companies to be levied on basic tax: • Domestic Company: 12% where income exceeds Rs.10 crore and 7% where income exceeds Rs.1 crore but less than Rs.10 crore. If a domestic company opts for concessional tax regime u/s. 115BAA/115BAB: then flat rate of 10% on basic tax • Non-resident Company: 5% where income exceeds Rs.10 crore and 2% where income exceeds Rs.1 crore but less than Rs.10 crore Health & Education Cess @ 4% is applicable on aggregate of basic tax & surcharge. Please note that surcharge and cess shall not be applied on basic tax while deducting TDS, if any, on income of resident investors only. G. Rights of Unitholders Please refer to SAI for details. H. List of official points of acceptance: Zerodha Fund House is focused on delivering a completely online experience. Accordingly, the Official Point of Acceptance (OPAs) will be online/ electronic mode only, unless specifically specified under the SEBI (MF) Regulations. The investors can undertake any transaction(s), including purchase/redemption and avail of any service(s) from time to time through the online/electronic modes via various sources like: ➔ Direct point of online contact for the AMC, such as the website, mobile application, WhatsApp, or any other online mode of communication by enabling transactions directly or in directly (by redirecting to any other relevant partner platform). ➔ Website/ Mobile App of MFU and MF Central - https://www.mfuindia.com ; https://www.mfcentral.com/ ➔ Website/ Mobile App of various aggregator platforms/ channel partners/ business partners/ investment advisers/ execution only platform with whom AMC has entered or may enter into specific arrangements. ➔ CAMS - https://www.camsonline.com/ ➔ Transactions through ONDC Network Participants. Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 62The investors can also submit the application by placing the order with the members (stock brokers) of stock exchanges or RIAs through the stock exchange infrastructure (i.e., BSE StAR MF/ NMF/ MFSS). Please refer to the AMC website, viz. www.zerodhafundhouse.com for the list of Official Points of Acceptance I. 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 (Standard Observation 20) (Consolidated Std. Obs. 48) a. AMCs are required to disclose penalties, pending litigation etc. for the last 5 financial years and wherever the amount of penalty is more than 5 lakhs. Not Applicable Refer to AMC/Fund Website viz. https://www.zerodhafundhouse.com/resources/disclosures/ for details of penalties, pending litigation, and action taken by SEBI and other regulatory and Govt. Agencies, updated on a continuous basis. Any amendments / replacement / re-enactment of SEBI (MF) Regulations subsequent to the date of the Scheme Information Document shall prevail over those specified in this Scheme Information Document. The Scheme under this Scheme Information Document was approved by the Board of Directors of Zerodha Trustee Private Limited (Trustees to Zerodha Mutual Fund) on October 31, 2025. The Trustees have ensured that the scheme approved is a new product offered by Zerodha Mutual Fund and is not a minor modification to the existing scheme/fund/product.(Standard Observation 25)(Consolidated Std. Obs. 65) Notwithstanding anything contained in this Scheme Information Document, the provisions of the SEBI (MF) Regulations, guidelines and circulars issued by SEBI from time to time will be applicable. (Standard Observation 22)(Consolidated Std. Obs. 63) For and on behalf of Zerodha Asset Management Private Limited Sd/- (Vishal Jain) Chief Executive Officer ceo@zerodhafundhouse.com Date: November 20, 2025 Place: Bengaluru Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 63List of official points of acceptance: Zerodha Fund House is focused on delivering a completely online experience. Accordingly, the Official Point of Acceptance (OPAs) will be online/ electronic mode only, unless specifically specified under the SEBI (MF) Regulations. The investors can undertake any transaction(s), including purchase/redemption and avail of any service(s) from time to time through the online/electronic modes via various sources like: ➔ Direct point of online contact for the AMC, such as the website, mobile application, WhatsApp, or any other online mode of communication by enabling transactions directly or indirectly (by redirecting to any other relevant partner platform). ➔ Website/ Mobile App of MFU and MF Central - https://www.mfuindia.com ; https://www.mfcentral.com/ ➔ Website/ Mobile App of various aggregator platforms/ channel partners/ business partners/ investment advisers/ execution only platform with whom AMC has entered or may enter into specific arrangements. ➔ CAMS - https://www.camsonline.com/ ➔ Transactions through ONDC Network Participants The investors can also submit the application by placing the order with the members (stock brokers) of stock exchanges or RIAs through the stock exchange infrastructure (i.e., BSE StAR MF/ NMF/ MFSS). Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 64Registrar and Transfer Agent Collecting Bankers Computer Age Management Services Limited (CAMS) YES Bank Limited SEBI Registration No. INR000002813 SEBI Registration No. INBI00000935 Rayala Tower-1, 158 Anna Salai, Kasturba Road, Bangalore - 560 001 Chennai - 600 002 HDFC Bank Limited SEBI Registration No. INBI00000063 Richmond Road, Bangalore - 560 025 ICICI Bank Ltd. SEBI Registration Number INBI00000004 Richmond Town, Bengaluru - 560025 Axis Bank Ltd. SEBI Registration Number INBI00000017 Jayanagar, Bengaluru - 560041 State Bank of India SEBI Registration Number INBI00000038 KORMANGALA,BENGALURU- 560095 Kotak Mahindra Bank Ltd. SEBI Registration Number INBI00000927 Nariman Point, Mumbai- 400021 Draft SID - Zerodha Nifty Short Duration G-Sec Index Fund 65