Disclosure Document - Karvy

KARVY STOCK BROKING LTD 

PORTFOLIO MANAGEMENT SERVICES 

DISCLOSURE DOCUMENT 

[As required under Regulation 14 of SEBI (Portfolio Managers) Regulation, 1993] 

1. This document supercedes the Disclosure document dated July 31, 2012 filed with 

Securities and Exchange Board of India (SEBI) on August 6, 2012. 

2. This Disclosure Document has been filed with SEBI along with the certificate from 

independent chartered accountant in the prescribed format in terms of Regulation 

14 of the SEBI (Portfolio Managers) Regulations, 1993. 

3. The purpose of this Disclosure Document is to provide essential information about 

the portfolio management services in such manner as to assist and enable the 

investors in making informed decision for engaging Karvy Stock Broking Limited as a 

Portfolio Manager. 

4. This document contains the necessary information about the Portfolio Manager 

required by an investor 

5. Investors should carefully read this entire document before making a decision and 

retain it for future reference. 

6. No person has been authorized to give any information or to make any 

representations not confirmed in this Disclosure Document in connection with the 

services proposed to be provided by the Portfolio Manager, and any information or 

representations not contained herein must not be relied upon as having been 

authorized by the Portfolio Manager. 

7. The Principal Officer designated by Karvy Stock Broking Limited, the Portfolio 

Manager is: 

Name of the Principal Officer 

VARUN GOEL 

Tel No: 022 33055000 

Email : 

Address 

pms@karvy.com 

701, Hallmark Business Plaza, 

Sant Dnyaneshwar Marg, 

Bandra (E), Mumbai 400 051 

8. This disclosure document is dated January 31, 2013. 

1

Portfolio Management Services 

KARVY STOCK BROKING LIMITED 

SEBI Registration No. INP000001512 

INDEX 

Sr No Contents Page Number 

1 Disclaimer Clause 3 

2 Definitions 4 - 7 

3 Description - The Portfolio Manager 

i 

ii 

History, Present Business and background of the Portfolio 

Manager. 

Promoters of the Portfolio Manager, Directors and their 

background. 

8 

9 - 10 

iii 

Details of the top 10 group companies of the Portfolio 

manager based on turnover as on March 31, 2012 

11 

iv Details of Services being offered. 11 

4 Penalties/Pending Litigations/Proceedings etc 12 - 13 

5 Services offered 13 - 18 

6 Risk Factors 18 - 22 

7 Client Representation 

i Category of clients as on December 31, 2012 22 -23 

ii 

Complete disclosure in respect of transactions with related 

parties as per the standards specified by the Institute of 

Chartered Accountants of India (as on March 31, 2012) 

23 -28 

8 Financial Performance of Portfolio Manager, Karvy Stock 

Broking Limited 

9 Portfolio Management Performance of the Portfolio 

Manager for last 3 years 

28 - 29 

29 - 32 

10 Nature of Expenses 32 - 34 

11 Taxation 34 - 37 

12 Accounting Policies 37 - 39 

13 Investor Services 39 

14 Grievances Redressal 39 

15 Dispute Settlement Mechanism 39 - 40 

2

16 General 40 

1)Disclaimer clause 

This document has been prepared in accordance with the Securities Exchange Board of India 

(Portfolio Managers) Regulations, 1993, as amended from time to time and other circulars 

issued by SEBI from time to time and have been filed with SEBI. This Document has neither 

been approved nor disapproved by SEBI nor has SEBI certified the accuracy or adequacy of 

the contents of this Document. 

This information is not for public distribution and has been furnished to you solely for your 

information and may not be reproduced or redistributed to any other person. 

2) Definitions 

In this Agreement, unless otherwise clearly indicated by or inconsistent with the context, the 

following expressions shall have the meaning assigned to them hereunder respectively: 

“Act” – means the Securities and Exchange Board of India Act, 1992. 

“Agreement” includes agreement entered between Karvy Stock Broking Limited, the 

portfolio manager and the client for the management of funds or securities of the client in 

terms of Regulation 14 of the SEBI (Portfolio Managers) Regulations, 1993 and SEBI 

(Portfolio Managers) Amendment Regulations, 2002 issued by the Securities and Exchange 

Board of India and as may be modified from time to time. 

“Board” means the Securities and Exchange Board of India. 

“ Bank Account” means one or more bank accounts opened, maintained and operated by 

the Portfolio Manager in the name of clients or a pool account in the name of the Portfolio 

Manager in which the funds handed over by the client shall be held by the Portfolio Manager 

on behalf of the Client. 

“Chartered Accountant” means a chartered accountant as defined in clause (b) of subsection 

(1) of section 2 of the Chartered Accountants Act, 1949 (38 of 1949) and who has 

obtained a certificate of practice under sub-section (1) of section 6 of that Act. 

3

“Client” means any body corporate, partnership firm, individual, HUF, association of person, 

body of individuals, trust, statutory authority, or any other person who enters into 

agreement with the Portfolio Manager for the managing of his/ her/ its portfolio. 

“Custodian” means any person who carries on or proposes to carry on the business of 

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

time. 

“Depository” means Depository as defined in the Depositories Act, 1996 (22 of 1996) and 

currently includes National Securities Depository Limited (NSDL) and Central Depository 

Services (India) Limited (CDSL) . 

“Depository Account” means any account of the client or for the client with an entity 

registered as depository participant under sub-section 1A of Section 12 of the Act or any 

other law for the time being relating to registration of depository participants. 

“Discretionary Portfolio Manager” means a portfolio manager who exercises or may, under 

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

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

case may be. 

“Disclosure Document” means this disclosure document dated January 31, 2013 for offering 

Portfolio Management Services. 

“Financial year” means the period of twelve months commencing on 1 st April every year an 

ending on 31 st march of the next year. 

“Funds” means the monies placed by the Client with the Portfolio Manager and any 

accretions thereto. 

“Funds managed” means the market value of the Portfolio of the Client as on date. 

“Fund Manager” (FM) means the individual/s appointed by the portfolio manager who 

manages, advises or directs or undertakes on behalf of the client (whether as a discretionary 

4

portfolio manager or otherwise) the management or administration of a portfolio of 

securities or funds of the client, as the case may be. 

“Initial Corpus” means the value of the funds and the market value of securities brought in 

by the client and accepted by the Portfolio Manager at the time of registering with the 

Portfolio Manager for the portfolio management services. 

“Investment Advisory Services” means the services, where the Portfolio Manager advises 

Clients on investments in general or gives specific advice required by the Clients and agreed 

upon in the Agreement. 

“Non Discretionary Portfolio Manager” means a portfolio manager who manages the funds 

in accordance with the directions of the client. 

“Person directly or indirectly connected” means any person being an associate, subsidiary, 

inter connected company or a company under the same management within the meaning of 

section 370(1B) of the Companies Act, 1956 or in the same group. 

“Portfolio” means the total holdings of securities and / or funds belonging to the client. 

“Portfolio Manager” (PM) means Karvy Stock Broking Ltd., a company Registered under the 

Companies Act, 1956 and having its Registered Office at Karvy House, 46, Avenue 4, Road 

No.10, Banjara Hills, Hyderabad and its PMS dealing office at 701, Hallmark Business Plaza, 

Sant Dnyaneshwar Marg, Bandra (E), Mumbai 400 051[ but may add more dealing offices in 

future] Karvy Stock Broking Limited has obtained a certificate from SEBI dated 1 st 

November, 2005 to act as Portfolio Manager under SEBI Registration No.INP000001512. 

“Portfolio Value” means the aggregate of the Portfolio Funds and Value of Portfolio 

Securities. 

“Principal Officer” means a director/an employee of the portfolio manager who is 

responsible for the activities of portfolio management and has been designated as principal 

officer by the portfolio manager. 

5

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

Regulations, 1993, as amended by Securities and Exchange Board of India (Portfolio 

Managers) Amendment Regulations, 2002, and as may be amended by SEBI from time to 

time including rules, guidelines or circulars issued in relation thereto from time to time. 

“Strategy” means any of the Portfolio Investment categories mentioned here or that may be 

introduced by the Portfolio Manager from time to time. The Term Strategy may be 

interchanged with Plans/Products/Options. 

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

of Section 3 of the Securities and Exchange Board of India Act, 1992. 

“Securities” means shares (whether dematerialized or otherwise), derivatives (futures and 

options), scrip, stocks, bonds, warrants, convertible debentures, non-convertible 

debentures, fixed return investments, floating rate instruments linked to MIBOR/call money 

etc., equity shares and equity linked instruments or other marketable securities of a like 

nature in or of any incorporated company or other body corporate, negotiable instruments, 

including usage bills of exchange, trade bills, deposits or other money market instruments, 

derivatives, commercial paper, certificates of deposits, units issued by Unit Trust of India and 

units issued by Mutual Funds, mortgage backed or other asset backed securities issued by 

any institution or corporate, cumulative convertible preference shares issued by any 

incorporated Company and securities issued by the Central Government or a State 

Government or any other securities that may be issued from time to time and other rights or 

interests in securities . 

“Securities lending” means the securities lending as per the Securities Lending Scheme, 

1997 and related guidelines specified by SEBI. 

“Structured Products” means products returns on which may be linked to Equity Index, Debt 

instruments, Non Convertible Debentures and may also be based on Basket of stock, index 

or stock futures with pre-defined capital protection. These are normally third party 

products. 

The terms that are used herein and not defined herein, except where the context otherwise 

so requires, shall have the same meanings as are assigned to them under the Act, the 

Regulations or the Rules. 

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3) Description 

i. History, Present Business and Background of the Portfolio Manager 

KARVY, is a premier integrated financial services provider, and ranked amongst the leading 

corporate in the country in all its business segments, servicing over millions of individual 

investors in various capacities, and provides investor services to many corporates, 

comprising the who’s who of Corporate India. KARVY covers the entire spectrum of financial 

services such as Stock Broking, Depository Participants, Distribution of financial products – 

mutual funds, bonds, fixed deposit, equities, Insurance Broking, Commodities Broking, 

Personal Finance, Advisory Services, Merchant Banking & Corporate Finance, placement of 

equity, IPOs, among others. Karvy has a professional management team and ranks among 

the best in technology and operations. 

Karvy Stock Broking Limited was incorporated on 30 th March 1995 having Registered Office 

at Karvy House 46, Avenue 4, Street No.-1, Banjara Hills, Hyderabad – 500 034. Karvy Stock 

Broking Limited (KSBL) is a member of – National Stock Exchange Limited, Bombay Stock 

Exchange Limited and MCX Stock Exchange Limited. Karvy Stock Broking Limited has been 

registered as a Depository Participant with National Securities Depository Ltd (NSDL) since 

December 1997 and with Central Depository Securities Ltd (CDSL) since October 1999 and 

offers these services across the network. Karvy has a large number of offices across the 

length and breadth of the country, thus making financial services accessible to urban, semiurban 

and rural investors. We offer broking services across the entire network on a robust 

platform with sound technological support and risk and surveillance mechanism which are of 

a high order. The broking services are backed by a strong research desk and a 

communication cell which is very proactive to market feed back and analyses information 

that flows into the capital markets which enables us to provide quality advice to our 

customers. The research team comprises of technical analysts who cover market trends and 

stock specific movements and fundamental specialists who track various segments of 

industry and corporate. In addition, our specific industry reports give comprehensive 

information on various industries. Besides this, we also provide customized advisory 

services to help in making the right financial moves that are specifically suited to portfolio 

requirements of the clients. 

Offering a wide trading platform with a dual membership both as a stock broker registered 

with NSE, BSE and MCX as well as a Depository Participant registered with both NSDL and 

CDSL, we are a powerful medium for trading and settlement of dematerialized shares. We 

have established live DPMs, Internet access to accounts and an easier transaction process in 

order to offer more convenience to individual and corporate investors. 

ii. Details of Promoters, directors and their background 

Mr. C. Parthasarathy, Promoter, Chairman and Managing Director, aged about 57 years; a 

leader in the financial services industry in India is responsible for building KARVY as one of 

India’s truly integrated Financial Service provider. He is a Fellow Member of the Institute of 

7

Company Secretaries of India, a Fellow Member of the Institute of Chartered Accountants of 

India and a graduate in Law. As Chairman, he oversees the group’s operations and renders 

vision and business direction. His passion and vision for achieving leadership in various 

segments of the business have transformed KARVY into a leading financial intermediary 

ranking amongst the top in the Registrar, Share Transfer and IPO Distribution businesses. He 

has about 35 years of experience in the financial services arena. He also holds directorships 

in various companies of the group. 

Mr. M. Yugandhar, Promoter cum Director, aged about 61 years, is founder of Karvy group 

has varied experience in the field of financial services spanning about 35 years. He is a 

Fellow Member of the Institute of Chartered Accountants. He also holds directorships in 

various companies of the group. 

Mr. M.S. Ramakrishna, Promoter cum Director, aged about 59 years, founder of Karvy 

group is orchestrator of technology initiatives such as the call center in the service of the 

customers. Mr.M.S Ramakrishna holds directorships in Karvy group and various other 

companies. He has about 32 years of experience in the financial services arena. He also 

holds directorships in various companies of the group. 

Mr. B.D. Narang, Non Promoter Director, aged about 67 years is a post graduate in Science, 

M.Sc. (Agr. Eco) He has held senior positions in various banks before superannuation and 

retiring as the Chairman and Managing Director of Oriental Bank of Commerce in the year 

2005. During his illustrious career, he has handled several special assignments viz, Alternate 

Chairman of the Committee on Banking Procedures set up by Indian banks’ Association for 

the year 1997-98, Chaired a panel on Serious Financial Frauds appointed by the RBI, Chaired 

a Panel on Financing Construction Industry appointed by Indian Banks’ Association, 

Appointed as Chairman of Governing Council of National Institute of Banking Studies & 

Corporate Management, Elected member of the Management Committee of India Banks’ 

Association, Member of the Advisory Council of Banker Training College (RBI), Mumbai, etc. 

Since retirement he has handled several assignments viz, Member- Expert group formed for 

examining problems of distressed farmers, member- Committee to Oversee the Working of 

National Education & Investor Fund (Nominated by the Ministry of Co. Affairs GOL), 

Technical Expert for Co-option in the Audit Board for Performance Audit/Reviews in respect 

of Housing Finance PSUs & Hudco, Advisor- DSP Merrill Lynch, Mumbai (Dec 2003 to Sept 

2007). 

Mr. Ashish Agrawal, Non Promoter Director, aged about 39 years, holds a Bachelor’s degree 

in Electronics Engineering from the SGS Institute of Technology & Science, Indore. He is also 

a Chartered Financial Analyst and an MBA from the Indian Institute of Management, 

Ahmadabad. Mr. Ashish Agarwal is presently serving as the Vice President of Baring Private 

Equity Asia- Mumbai and is responsible for its investments in India. Prior to the current 

assignment with Baring, Mr. Ashish was associated with Lehman Brothers- Mumbai as a 

Senior Vice President. He has about 18 years of experience and has been also associated 

8

with the Bank of America, JM Morgan Stanley- Mumbai, ICICI Securities and CMC Limited in 

his various prior assignments. 

Ms. Vishakha Mulye, Non Promoter Director, aged about 43 years, holds a Bachelor’s 

degree in commerce from the University of Bombay. She is also a Chartered Accountant fom 

the Institute of Chartered Accountants of India. Ms. Vishakha joined the ICICI Group in 1993 

and has vast experience in the areas of strategy, treasury & markets, proprietary equity 

investing and management of long term equity investments, structured finance and 

corporate & project finance. From 2002 to 2005, she was responsible for the Bank’s 

structured finance and global markets businesses, and its financial Institutions relationships. 

From 2005-2007, she was the CFO of ICICI Bank. In October 2007, she was elevated to the 

Board of ICICI Bank’s general insurance subsidiary. ICICI Lombard General Insurance 

Company. In April 2009, she took over as Managing Director & CEO of ICICI Venture Funds 

Management Co. Ltd. She was selected as ‘Young Global Leader’ for the year 2007 by World 

Economic Forum. She has also been conferred the award for “Most Powerful Women in 

Indian Business” thrice (2007, 2009 & 2010) by Business Today. 

(iii) Details of the Top 10 Group companies/firms based on turnover as on March 31, 2012 

Name of the Company Nature of Business Status 

Karvy Computershare 

Pvt. Ltd. 

SEBI Registered Registrar and 

Share Transfer Agent 

Group company 

Karvy Consultants Ltd SEBI Registered OTCEI member Group company 

Karvy Comtrade Ltd. FMC/ NCDEX /MCX/NMCE/ACE / 

ICEX/ NCDEX Spot Exchange / 

National Spot Exchange 

registered commodity broker 

wholly owned subsidiary 

company 

Karvy Realty (India) Ltd. Realty Services wholly owned subsidiary 

company 

Karvy Investor Services 

Ltd. 

Karvy Insurance Broking 

Ltd. 

Karvy 

Management 

Ltd. 

Data 

services 

Karvy Financial Services 

Ltd. 

SEBI Registered Merchant Banker 

and Underwriter. 

IRDA Registered Insurance Broker 

Transaction Processing 

Financial Services-NBFC 

Wholly owned subsidiary 

company 


company 


company 


company 

Karvy Capital Limited Financial Services-NBFC wholly owned subsidiary 

company 

Karvy Inc- USA Advisory Services Wholly owned subsidiary 

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(iv )Details of the services being offered: 

Portfolio Manager offers Discretionary, Non discretionary & Advisory services as per the 

preference and agreement with the individual client (For more details kindly refer Annexure 

A). 

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

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

I 

All cases of penalties imposed by 

the Board or the directions issued 

by Board under the Act or Rules or 

Regulations made there under 

The Whole Time Member of Securities 

and Exchange Board of India 

(“SEBI”) had passed a common final 

order dated June 22, 2007 (“Order”) 

against the KSBL – Stock Broker, KSBL 

– Depository participant and Karvy 

Computershare Private Limited (KCPL) 

in the matter of IPO irregularities. 

Against the appeal made by KSBL and 

KCPL, Hon’ble SAT set aside the order 

and remanded the cases to SEBI with a 

direction to pass three separate 

orders on the three show causes 

issued by the learned whole time 

member. The Whole Time Member of 

SEBI has granted a personal hearing as 

per the order of Hon’ble SAT which 

and the matter is yet to conclude. 

Pending 

Ii The nature of penalty/direction As above 

SEBI has initiated proceedings against 

the company and its directors before 

the additional chief metropolitan 

magistrate, Mumbai, with respect to 

the investigation conducted by SEBI in 

various IPOs. 

Iii Penalties imposed for any 

economic offence and/or for 

violation of any securities laws 

Iv Any pending material 

litigation/legal proceedings against 

the Portfolio Manager/key 

personnel with separate disclosure 

regarding pending criminal cases, if 

any 

None 

SEBI has initiated proceedings against 

KSBL and its directors before the 

additional chief metropolitan 

magistrate, Mumbai, with respect to 

the investigation conducted by SEBI in 

10 

Pending

various IPOs. 

v 

Any deficiency in the systems and 

operations of the Portfolio 

Manager observed by the Board or 

any regulatory agency 

Vi Any enquiry/adjudication 

proceedings initiated against the 

Portfolio Manager or its directors, 

principal officer or employee or 

any person directly or indirectly 

connected with the Portfolio 

Manager or its directors, principal 

officer or employee, under the Act 

or Rules or Regulations made there 

under 

Not Applicable 

Not Applicable 

5) Services Offered 

5.1 The Portfolio Manager offers the following three types of Services 

a. Discretionary 

The Portfolio account of the client is managed at the full Discretion and liberty of Portfolio 

Manager. 

Under these services, the choice as well as the timings of the investment decisions rest 

solely with the Portfolio Manager. The Portfolio Manager may at times and at its own 

discretion, adhere to the views of the Client pertaining to the investment /disinvestment in 

the Client’s Portfolio. The Portfolio Manager shall have the sole and absolute discretion to 

invest in respect of the Client’s account in any type of security as per the Agreement and 

make such changes in the investments and invest some or all of funds in the Client’s account 

in such manner and in such markets as it deems fit. The Client may give informal guidance to 

customize the portfolio strategies; however, the final decision rests with the Portfolio 

Manager. The securities invested / disinvested by the Portfolio Manager for Clients in the 

same Strategy may differ from one Client to another Client. The Portfolio Managers’ decision 

(taken in good faith) in deployment of the Clients’ account is absolute and final and can 

never be called in question or be open to review at any time during the currency of the 

agreement or any time thereafter except on the ground of malafide, fraud, conflict of 

interest or gross negligence. This right of the Portfolio Manager shall be exercised strictly in 

accordance with the relevant Acts, Rules, and Regulations, guidelines and notifications in 

force from time to time. 

11

Under these services, the Clients may authorize the Portfolio Manager to invest their Funds 

in specific financial instruments or a mix of specific financial instruments or restrict the 

Portfolio Manager from investing in specific financial instruments or securities. Periodical 

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

Portfolio Strategy: 

1. K-Sensible Portfolio – this is a long term oriented strategy with a low churn rate and 

ideal for investors with a two to three year investment objective 

2. K-Aggressive Portfolio – this strategy provides a balance between growth and safety 

by employing a strategy of systematic profit booking. This strategy has a medium 

churn rate and is ideal for investors with a one to two year investment objective. 

3. K-Energetic Portfolio – this strategy provides returns by following an aggressive 

style of investing which entails higher risks. This strategy has a high churn rate and is 

ideal for investors with a 12 to 15 month investment objective. 

4. Alpha Portfolio – this is designed for those investors who seek long-term capital 

appreciation from their asset allocation to equities. The portfolio manager will invest 

in stocks across sectors, market capitalization categories and investment themes. 

5. Delta Portfolio – This is designed for those investors who seek long-term capital 

appreciation from their asset allocation to equities and debt. The portfolio will 

invest in mutual funds across sectors, market capitalization categories and 

investment themes. 

6. Omega Portfolio – This is designed for those investors who seek long-term capital 

appreciation from their asset allocation to equities, debt, gold and other asset 

classes which are available through either exchange traded products or through 

mutual funds. 

7. Theta Portfolio – This is designed for those investors who seek income and longterm 

capital appreciation from their asset allocation to debt. 

8. Alpha Plus Portfolio – This is a diversified portfolio with investments in stocks across 

sectors, market capitalizations and investment themes. 

9. Gamma Portfolio – Gamma Portfolio aims to generate Capital appreciation in the 

medium term through investments in equities. It would aim to invest in high growth 

companies with sustainable business models backed by strong management 

capabilities. 

10. PSI Portfolio – This is designed for those investors who seek long-term capital 

appreciation from their asset allocation to equities and other investment vehicles, 

and to outperform the market in the long run. The portfolio will invest in equity, 

equity related instruments and other alternative asset classes. 

12

11. Aurous portfolio - This is designed for those investors who seek long-term capital 

appreciation from their asset allocation primarily to debt and gold and other 

investment vehicles as may be required. 

Note: The Aurous Portfolio shall be introduced with effect from February 15, 2013 

12. Zeta portfolio - This is designed for those investors who seek long-term capital 

appreciation from their asset allocation to equities, debt, gold, stock futures and 

options and other asset classes which are available through either exchange traded 

products, Over the counter products or through mutual funds 

Note: The Zeta Portfolio shall be introduced with effect from February 15, 2013 

b. Non Discretionary 

Non-Discretionary Portfolio is the Portfolio which Portfolio Manager manages in 

consultation with and as per the directions or consent of the client. Under these services, 

the Clients decide their own investments with the Portfolio Manager only facilitating the 

execution of transactions. The .Portfolio Manager’s role would include but not limited to 

providing research, structuring of clients’ portfolios, investment advice and guidance and 

trade execution at the Client’s request. The Portfolio Manager shall execute orders as per 

the mandate received or consent obtained from the Client. The deployment of the Client’s 

Funds by the Portfolio Manager shall be as per the instructions or consent of the Client. The 

rights and obligations of the Portfolio Manager shall be exercised strictly in accordance with 

the Act, Rules and/or Regulations, guidelines and notifications in force from time to time. 

Periodical statements in respect of Client’s Portfolio shall be sent to the respective Clients. 

The following are illustrative, but not exhaustive, investment strategies available for client 

availing Non-Discretionary Portfolio Management Services. 

1. Equity Portfolio: Equity Portfolio (Non discretionary) are designed for those 

investors who seek long-term capital appreciation from their asset allocation to 

equities. The portfolio manager will invest in stocks across sectors, market 

capitalization categories and investment themes, in consultation with and as per 

directions or consent of the client. 

2. Non Convertible Debentures: The Non Convertible Debentures are debentures 

which do not get converted into equity and normally attract a fixed rate of return. 

The Non-convertible Debentures may be listed or unlisted. 

Investments will be made in the Non Convertible Debentures in consultation with 

and as per directions or the consent of the client. 

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3. Structured product: The Structured products are designed for those investors who 

want returns linked to price movement of any Equity index, basket of stocks, 

commodities, precious metals, etc., with a predefined level of capital protection. 

Structured Products may be principal or non principal protected or may not have 

any protection at all. Investments will be made in the structured products in 

consultation with and as per directions or the consent of the client. 

4. Non Convertible Debentures as part of Structured Products 

Non convertible Debentures are normally issued with a fixed rate of Interest. In case 

of Non convertible Debentures issued as part of a structured product, the returns on 

Non-convertible debentures may be linked to the price movement of an underlying 

or derivative thereof. Investments will be made in such products in consultation with 

and as per directions or consent of the client. 

5. Omega Portfolio 

It is designed for those investors who seek long-term capital appreciation from their 

asset allocation to equities, debt, gold and other asset classes which are available 

through either exchange traded products or through mutual funds. 

6. Optima Portfolio 

It is designed for those investors who seek capital appreciation from their asset 

allocation to Equities, debt and gold. 

7. Alpha Portfolio 

It is designed for those investors who seek aggressive capital appreciation from their 

equity asset allocation. The portfolio will invest in stocks across sectors, market 

capitalization categories and investment themes. 

Note: The Alpha Portfolio has been introduced with effect from 1/02/2012. 

c. Advisory 

Portfolio Manager will provide advisory services, as per the Regulations, which shall be in 

the nature of investment advice and shall include the responsibility of advising on the 

portfolio strategy, investment, disinvestment of the various stocks in the client’s portfolio, 

for an agreed fee, entirely at the client’s risk. This service will be purely of advisory in nature 

under an agreed fee structure with the client. It is up to the client to accept the 

14

ecommendations/advice of Portfolio Manager and Portfolio Manager will not be held 

responsible for any consequence arising out of acceptance of Portfolio Manager’s advice 

under this service. 

“Equity Advisory Portfolio (Advisory) product” has been designed for those investors who 

seek long-term capital appreciation from their asset allocation to equities. The portfolio 

manager will provide the advice to invest in stocks across sectors; market capitalization 

categories and investment themes but the decision to invest will be of the client. 

5.2 Present Investment Objective 

The General Objective is to formulate and device the investment philosophy to 

achieve long term growth of capital by investing in assets, which generate 

reasonable return and to ensure liquidity. The actual portfolio management style 

will vary in line with profile of each client with regards to his risk tolerance levels and 

specific preferences or concerns. (The specific objective will be as mentioned in the 

agreement with the client). 

5.3 Types of securities 

The Portfolio Manager/Fund Manager shall invest in all such types of Securities as 

defined (kindly refer to the definition) and in all such Securities as permissible from 

time to time. 

5.4 Investment in Group / associate companies 

The Portfolio Manager/Fund Manager may invest in Securities of the 

associate/group companies subject to the applicable laws/ regulations/ guidelines. 

These investments will be carried out to achieve the investment objectives and 

strategies and in the normal course of investment activity subject to the applicable 

laws/regulations. 

The Portfolio Manager / Fund Manager shall not make any investments in any 

unlisted securities of associate/group companies of the Portfolio Manager/ 

promoter. The Portfolio Manager / Fund Manager will also not make investment in 

privately placed securities issued by Associate/Group companies of the promoter. 

The Portfolio Manager may invest not more than 25% of the portfolio of an 

individual client in the listed securities of the Group companies. 

5.5 Minimum Investment Amount 

The Portfolio Manager shall not accept funds / securities from the new clients, 

cumulative value of which is less than Rupees TwentyFive Lakhs or as specified in 

the agreement with the Portfolio Manager or as amended/specified in the SEBI 

(portfolio managers) regulations, 1993. The Portfolio Manager shall make necessary 

15

6) Risk factors 

amendments on Minimum Investment Amount and shall be applicable on 

prospective basis. 

1. Investments in securities are subject to market risks including price volatility and 

liquidity risk and there is no assurance or guarantee that the objectives of the strategy 

will be achieved. The investment may not be suited for all categories of investors. The 

past or present performance of these strategies does not indicate the future 

performance of the same strategy or any other future strategies launched subsequently 

by Portfolio Manager. With reference to appreciation on the portfolio, the investors are 

not being offered any guaranteed or indicative returns through any of the strategies. 

The Portfolio Manager also does not guarantee any capital protection for any strategy. 

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

allocation and non-diversification of portfolio. The investment objective, investment 

strategy and asset allocation may differ from client to client. However, generally, highly 

concentrated portfolios with lesser number of stocks will be more volatile than a 

portfolio with a larger number of stocks. Portfolios with higher allocation to equities will 

be subject to higher volatility that portfolios with low allocation to equities. Diversified 

portfolios (allocated across companies and broad sectors) generally tend to be less 

volatile than non diversified portfolios. The names of the various strategies do not in any 

manner indicate their prospects or returns. 

3. Investment decisions made by the Portfolio Manager may not always be profitable since 

actual market movement may be at variance with anticipated trends. 

4. ETF may trade above or below their NAV. The NAV of ETF will fluctuate with changes in 

market value of scheme’s holdings of underlying stocks. However, given that ETF can be 

created and redeemed only in creation units directly with the Mutual Fund, it is 

expected that large discounts or premiums to the NAVs of ETFs will not sustain due to 

availability of arbitrage possibility. Any changes in trading regulations by the Exchange 

(s) or SEBI may affect the ability of market maker to arbitrage resulting into wider 

premium / discount to NAV for ETFs. 

5. The performances of the strategies depend on the performance of the market and the 

individual companies in which investment have been made under strategies relative to 

industry specific and macro economic factors. The Portfolio Manager does not assure or 

guarantee that Performance of Portfolio of the Investor shall better the Performance of 

any Benchmark Index. 

6. The tax benefits described in this Disclosure Document are as available under the 

present taxation laws and are available subject to conditions. The information given is 

included for general purpose only and is based on advice received by the Portfolio 

Manager regarding the law and practice in force in India and the investors should be 

aware that the relevant fiscal rules or their interpretation may change. As is the case 

with any investment, there can be no guarantee that the current tax position or the 

proposed tax position prevailing at the time of an investment in the Portfolio will endure 

indefinitely. In view of the individual nature of tax consequences, each investor is 

16

advised to consult his/her own professional tax advisor regarding the taxation aspects of 

his/ her portfolio investments. 

7. Prospective investors should review/ study this Disclosure Document carefully and in its 

entirety and shall not construe the contents hereof or regard the summaries contained 

herein as advice relating to legal, taxation, or financial/investment matters. Prospective 

investors are advised to consult their own professional advisor(s) as to the legal, tax, 

financial or any other requirements or restrictions relating to the subscription, gifting, 

acquisition, holding, disposal (sale or conversion into money) of Portfolio and to the 

treatment of income(if any), capitalization, capital gains, any distribution, and other tax 

consequences relevant to their portfolio, acquisition, holding, capitalization, disposal 

(sale, transfer or conversion into money) of portfolio within their jurisdiction of 

nationality, residence, incorporation, domicile etc. or under the laws of any jurisdiction 

to which they or any managed funds to be used to purchase/gift portfolio of securities 

are subject, and also to determine possible legal, tax, financial or other consequences of 

subscribing/gifting, purchasing or holding portfolio of securities before making an 

investment. 

8. The debt investments and other fixed income securities may be subject to interest rate 

risk, liquidity risk, credit risk and reinvestment risk. Liquidity in these investments may 

be affected by trading volume, settlement period and transfer procedures. Issuer of 

fixed income security may default or may be unable to make timely payments of 

principal and interest. Net Asset Value of portfolio may be affected due to perceived 

level of credit risk as well as actual event of default. 

9. The corporate debt market is relatively illiquid vis-à-vis the government securities 

market. There could therefore be difficulties in exiting from corporate bonds in times of 

uncertainties. Further, liquidity may occur only in specific lot sizes. Liquidity in a security 

can therefore suffer. Even though the Government securities market is more liquid 

compared to that of other debt instruments, on occasions, there could be difficulties in 

transacting in the market due to extreme volatility or unusual constriction in market 

volumes or on occasions when an unusually large transaction has to be put through. 

There can be no assurance that the requirements of the securities market necessary to 

maintain the listing of specified debt security will continue to be met or will remain 

unchanged. 

10. Exposure to select Sector(s) carries the performance risk of the relevant sector, which 

could outperform or underperform the market and/or various indices. 

11. Technology and pharmaceutical stocks and some of the investments in niche sectors run 

the risk of volatility, high valuation, obsolescence and low liquidity. 

12. Frequent rebalancing of portfolio may result in higher brokerage / transaction cost. Also 

the allocation to different securities can vary from 0 to 100 %, hence there can be a vast 

difference between the performance of the products and returns generated by 

underlying securities. 

13. Information available on some companies in which the Portfolio manager has made 

investments may be limited. 

17

14. The performance of the strategies may be affected by change in Government Policies 

including taxation, and certain unforeseen developments in political or general areas at 

the national or international level. Also, the investments are subject to external risks 

such as war, natural calamities and policy changes of local / international markets which 

affect stock markets. 

15. The performance of the strategies may also be affected and investor could lose money 

over short periods due to fluctuation in NAV of Portfolio arising out of fluctuations of 

interest rates, credit risk, political and geopolitical risk, currency risk, foreign exchange 

risks, foreign investments, risks arising from changing business dynamics, risk associated 

with investment in securities debt, risk due to movement in Futures and options 

markets, changes in the general market conditions, forces affecting the capital markets, 

closure of stock exchange due to circuit filter rules or otherwise and risks associated 

with trading volumes, settlement periods, transfer procedures, liquidity and settlement 

systems in equity and debt markets. 

16. There is a possibility that loss may be sustained by the Portfolio as a result of the failure 

of another party (usually referred as the “Counter party”) to comply with the terms of 

the derivative contract. 

17. Portfolio Manager, subject to authorization in writing by the client, may participate in 

securities lending. Engaging in securities lending is subject to risks related to fluctuations 

in collateral value/settlement/liquidity/default from counter party, including corporate 

benefits accrued thereon. This may lead to the risk of Approved Intermediary unable to 

deliver back the securities. Portfolio Manager cannot be held liable for any loss arising 

out of operation of such strategies. 

The portfolio manager may in the course of its activities, avail the services of persons / 

bodies who are not employees of the portfolio manager. The portfolio manager would 

exercise due diligence when employing such persons, however there may be losses 

incurred on account of any act or omission on part of such persons or bodies. The 

portfolio manager disclaims liability for any loss in the portfolio on this account. 

All portfolios under portfolio management are subject to change at anytime at the 

discretion of the Portfolio Manager. 

18. In the case of stock lending, risks relate to the defaults from counterparties with regard 

to securities lent and the corporate benefits accruing thereon, inadequacy of the 

collateral and settlement risks. The Portfolio Manager is not responsible or liable for any 

loss resulting from the operations of the strategies/options. 

19. Investments in the Market Linked Debentures (MLDs) are also subject to model risk. The 

MLDs are created on the basis of complex mathematical models involving multiple 

derivative exposures which may or may not be hedged and the actual behavior of the 

securities selected for hedging may significantly differ from the returns predicted by the 

mathematical models. 

20. Strategies may use derivative instrument like futures and options (index as well as 

individual securities), warrants, convertible securities, swap agreements, etc. for the 

18

purpose of hedging and/or portfolio balancing, as permitted under the 

Regulations/guidelines. Strategies using such derivative products may be affected by 

risks different from those associated with stock and bonds. Such derivative products are 

highly leveraged instruments and their use requires a high degree of skill, expertise and 

diligence. Small price movements in the underlying security may have a large impact on 

the value of the derivatives and futures and options and may also result in loss. Some of 

the risks relate to mis-pricing or the improper valuation of the derivatives/futures and 

option and the inability to correlate the positions with the underlying assets, rates and 

indices. The risk of loss associated with futures contracts is potentially unlimited due to 

the low margin deposits required and the extremely high degree of leverage involved in 

futures pricing. Also, the derivatives/future and options market is nascent in India. 

The liquidity of the investments is guided by trading volumes in the securities in which it 

invests. Although securities may be listed on the Exchange(s), there can be no assurance 

that an active secondary market will develop or be maintained. This may limit the 

Portfolio Manager’s ability to freely deal with securities in the Portfolio and may lead to 

incurring of losses till the security is finally sold. Different segments of the financial 

markets have different settlement periods and such periods may be extended 

significantly due to unforeseen circumstances. The inability of a Portfolio to make 

intended securities purchase due to settlement problems could cause the portfolio to 

miss certain investment opportunities. Similarly, the inability to sell securities held in the 

portfolio due to absence of a well developed and liquid secondary market would at 

times result in potential losses in the Portfolio, in case of a subsequent decline in the 

value of securities held in the Portfolio. 

21. The Portfolio Manager may invest in non-publicly offered debt securities and unlisted 

securities. This may expose client’s portfolio to liquidity risks. 

22. Securities, which are not listed on the Stock Exchanges, are inherently illiquid in nature 

and carry a larger amount of liquidity risk, in comparison to securities that are listed on 

the Exchanges or offer other exit options to the investor, including a PUT option. The 

Portfolio Manager may, considering the overall level of risk of the Portfolio, invest in 

lower rated/unrated securities that offer attractive yield, which may increase the risk of 

the Portfolio. Such investments shall be subject to the scope of investments laid down 

in the executed agreement. 

23. The Portfolio Manager may seek to create value by investing in stocks that trade below 

the estimated fair value of the Company, which shall be judged by various quantitative 

valuation parameters. But due to various reasons, it may so happen that such stocks 

continue to languish and are not able to attain the price discovery. Accordingly, this may 

have material adverse impact on the performance of the portfolio. 

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

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

the clients may suffer opportunity loss. 

19

7) Client Representation 

i. Category of clients as on December 31 ,2012. 

Category of Clients No of Clients Funds 

Managed 

(Rs. In Crs) 

Associate/Group companies 

As on 31 st December, 2012. - - 

As on 31 st March 2012. - - 

As on 31 st March, 2011. - - 

As on 31 st March, 2010. - - 

Others 

Remarks 

As on 31 st December, 2012. 409 100.14 Discretionary, Nondiscretionary 

As on 31 st March 2012. 467 67.58 Discretionary, Nondiscretionary 

As on 31 st March, 2011. 309 25.96 Discretionary, Nondiscretionary 

As on 31 st March, 2010. 49 7.94 Discretionary & Nondiscretionary 

Total 

As on 31 st December,2012. 409 100.14 Discretionary, Nondiscretionary 

As on 31 st March 2012. 467 67.58 Discretionary, Nondiscretionary 

As on 31 st March, 2011. 309 25.96 Discretionary, Nondiscretionary 

As on 31 st March , 2010. 49 7.94 Discretionary & Nondiscretionary 

Sr. 

No 

ii.Complete disclosure in respect of transactions with related parties as per the standards 

specified by the Institute of Chartered Accountants of India (as on 31 st March 2012) 

Name of the related party 

Nature of Transaction 

Amount 

2011-12 2010-11 

1 

Karvy Consultants Limited 

Loans and advances 

given/(repaid),net 

13,12,867 

(3,99,93,432) 

(Group Company) Balance at year end 4,17,39,076 

4,04,26,209 

20

2 

Karvy Computershare Pvt. 

Limited 

Trading in securities 

15,29,614 5,31,85,299 

(Group Company) Rent (paid) / received 13,89,727 13,32,075 

Reimbursement of expenses 35,55,672 - 

3 Karvy Investor Services Limited 

(Subsidiary company) 

Interest on advances received 

/ (paid), net (16,22,083) (1,65,71,604) 

Loans and advances given / 

(repaid), net# (44,79,497) 

14,57,31,059 

Reimbursement of expenses 1,67,20,534 

75,14,301 

Balance at year end 2,58,947 47,38,444 

4 Karvy Comtrade Limited 

(Subsidiary company) Trading in securities 1,658 29,79,482 


/ (paid), net (14,78,438) 


(repaid), net (12,02,38,033) 

(14,18,219) 

10,50,00,000 


4,23,25,075 

Balance at year end 5,399 12,02,43,432 

5 

Karvy Insurance Broking 

Limited 



/ (paid), net 

36,62,121 13,50,177 


(repaid), net (90,18,812) 

2,87,15,159 

21

Reimbursement of expenses 50,85,278 1,08,16,752 

Balance at year end 3,87,37,348 

4,77,56,160 

6 

Karvy Data Management 

Services Limited 



/ (paid), net 

74,30,110 8,81,712 

Rent (paid) / received 55,21,464 56,15,064 

Investment in equity shares 3,00,00,000 

5,40,00,000 


(repaid), net 5,07,17,053 (1,53,49,521) 


5,14,17,344 

Advance for investments 2,00,00,000 


40,90,430 

7 Karvy Financial Services Limited 

(Subsidiary company) Trading in securities 31,35,48,725 


/ (paid), net 19,76,83,848 

93,68,33,765 

1,66,81,918 

Investment in equity shares - 10,00,00,000 


(repaid), net (36,88,60,618) 

49,84,48,195 


1,35,06,051 

Balance at year end 2,03,486 36,90,64,104 

Trade payables / (receivables) 95,59,345 89,10,600 

22

8 

Karvy Forex & Currencies 

Private Limited 

(Subsidiary company) Investment in equity shares - 1,75,000 


(repaid), net 

82,840 1,41,983 

Reimbursement of expenses 79,934 1,25,219 

Balance at year end 31,96,163 31,13,323 

Karvy Realty (India) Limited 



(repaid), net 

42,90,750 (50,00,000) 

Reimbursement of expenses 47,58,912 6,47,884 


95,18,53,640 

9 Karvy Capital Limited 

(Subsidiary company) Trading in securities 28,95,94,049 


/ (paid), net (3,42,096) 

2,45,87,572 

- 

Investment in equity shares 4,00,00,000 


(repaid), net 2,05,17,242 

30,00,000 

- 

Reimbursement of expenses 56,96,678 - 


- 

Trade payables / (receivables) 1,08,06,504 

47,17,218 

23

10 Karvy Holdings Limited 

(Subsidiary company) Investment in equity shares 5,00,000 - 

11 Karvy Asia Pacific Pte Limited 

(Subsidiary company) Investment in equity shares 5,15,73,040 

- 

12 Karvy Inc., USA 

(Subsidiary company) Investment in equity shares 1,41,31,750 

7,59,96,900 

13 Indigo Tx Software Pvt Limited 

(Associate) 


/ (paid), net 

- 1,64,548 


(repaid), net (5,67,288) (1,44,75,870) 

Balance at year end - 5,67,288 

14 Mr. M. S. Ramakrishna 

(Key Management Personnel) Remuneration paid 40,16,020 40,16,020 

15 Ms. Spandana Mulpuri Remuneration paid - 19,538 

(Relatives of Key Management 

Personnel) 

24

8) The Financial Performance of Portfolio Manager (based on audited financial statements) 

As at 

31st March, 2012 

Rs in Lacs 

As at 


Rs in Lacs 

As at 


Rs in Lacs 

SOURCES OF FUNDS 

Shareholders' Funds 35,248.15 34,865.56 33,827.10 

Share Application Money 174.20 174.20 174.20 

Loan Funds 56,022.84 23,030.85 3,434.70 

Deferred Tax Liability - - - 

Total 91,445.19 58,070.61 37,436.00 

APPLICATION OF FUNDS 

Net Fixed Assets 15,992.06 18,149.00 17,651.43 

Stock Exchange Membership Cards 15.75 21.00 26.25 

Investments 17,392.55 18,002.92 15,670.02 

Current Assets 73,824.32 44,954.71 33,024.30 

Less: Current Liabilities and Provisions 15,908.43 23,228.74 28,984.70 

Net Current Assets 57,915.89 21,725.97 4,039.60 

Deferred Tax Asset 128.94 171.76 48.70 

Total 91,445.19 58,070.61 37,436.00 

Summarized Financial Statement - Profit and Loss Account 

For the year ended 


Rs. Lacs 

For the year 

ended 

31st March, 

2011 

Rs. Lacs 

For the year ended 


Rs. Lacs 

Total Income 25,658.97 24,105.18 26,415.53 

Total Expenses 24,086.71 20,176.86 

25

21,200.72 

Profit before Depreciation and Tax 1,572.26 2,904.47 6,238.68 

Depreciation/Amortisation 1,146.87 1,288.22 1,392.88 

Profit before Tax 425.39 1,616.24 4,845.79 

Provision for Tax 42.81 (577.77) 1,625.75 

Profit After Tax 382.58 1,038.47 3,220.04 

9) Portfolio Management performance of Portfolio Manager, for the last three years , and 

in case of discretionary Portfolio Manager disclosure of performance indicators calculated 

using weighted average method in terms of Regulation 14 of the SEBI (Portfolio Managers) 

Regulations, 1993. Find below the Performance of the Portfolio Manager calculated using 

weighted average Method for the three financial years 2009-10, 2010-11, 2011-12 and 

upto December 31, 2012. 

Portfolio performance is a percentage, net of all fees and charges levied by the Portfolio 

Manager 

Returns% 

Period 

01.04.2012- 

31.12.2012 

01.04.2011- 

31.03.2012 

01.04.2010- 

31.03.2011 

01.04.2009- 

31.03.2010 

Discretionary PMS- Resident 

Portfolio 

Performance (%) 

Benchmark 


K Energetic 6 -32.49 -41.26 6.96 

CNX Midcap 5.81 -5.11 -16.92 11.52 

Portfolio 


Benchmark 


K Aggressive 12.49 -0.06 -28.94 35.87 

CNX Midcap 8.21 -7.49 -1.53 109.61 

26

Portfolio 


K Sensible 0.37 -14.62 -27.5 10.97 

Benchmark 


S & P CNX 

Nifty 

7.59 -11.25 13.01 31.65 

Portfolio 


Alpha 16.58 -12.06 -2.84 N.A. 

Benchmark 


S&P CNX 

Nifty 

10.67 -2.49 8.17 N.A. 

Portfolio 


Alpha Plus 10.02 3.72 N.A. N.A 

Benchmark 


S&P CNX 

Nifty 

19.26 -1.48 N.A N.A 

Portfolio 


Delta 11.24 -3.68 0.69 N.A. 

Benchmark 


BSE 200 

Index 

11.11 -4.83 7.33 N.A. 

Portfolio 


Omega 10.5 -3.58 -3.04 N.A. 

Benchmark 


BSE 200 

Index 

16.02 -5.97 0.74 N.A. 

Portfolio 


Benchmark 


Gamma 18.34 37.53 N.A. N.A. 

CNX Midcap 18.55 45.28 N.A. N.A. 

Portfolio 


Theta NA N.A N.A. N.A. 

Benchmark 


Crisil 

Composite 

Bond Index 

NA N.A N.A. N.A. 

27

Portfolio 


Benchmark 


PSI -17.67 N.A N.A. N.A. 

S&P CNX 500 18.75 N.A N.A. N.A. 

Discretionary PMS - Non Resident 

Portfolio 

Performance (%) K Sensible 15.01 -9.74 N.A. N.A. 

Benchmark 


S&P CNX 

Nifty 

11.51 -9.23 N.A. N.A. 

Portfolio 

Performance (%) Delta 13.35 -1.6 N.A. N.A. 

Benchmark 


BSE 200 

Index 

12.49 -3.26 N.A. N.A. 

Portfolio 


Benchmark 


Alpha 16.53 -10.51 N.A. N.A. 

S&P CNX 

Nifty 

11.51 -6.64 N.A. N.A. 

Portfolio 


Benchmark 


Alpha Plus 16.25 -0.9 N.A. N.A. 

S&P CNX 

Nifty 

11.51 4.89 N.A. N.A. 

Portfolio 

Performance (%) Omega 11.05 -3.4 N.A. N.A. 

Benchmark 


BSE 200 

Index 

13.11 -9.13 N.A. N.A. 

Non Discretionary PMS- Resident 

Portfolio 


K Series 4.37 -19.56 -17.48 10.25 

28

Portfolio 


Structured 

Products 

4.8 -3.86 -2.5 N.A. 

Portfolio 

Performance (%) Optima 16.63 4.94 N.A. N.A. 

Portfolio 

Performance (%) Alpha 16.44 N.A. N.A. N.A. 

Portfolio 

Performance (%) Omega N.A N.A N.A. N.A. 

Non Discretionary PMS- Non Resident 

Portfolio 


Optima 8.68 -1.98 N.A. N.A. 

Note: 

Dates of inception of the below discretionary Portfolio Management strategies are as 

follows: 

Delta : November 23, 2010 ; Omega: December 22, 2010 & PSI: April, 30 , 2012 

Date of inception of Structured Products offered as part of Non Discretionary Portfolio 

Management services is as follows: 

G-11: July 12, 2010 ; G-16: September 13, 2010 ; G-17: October 1, 2010 

Portfolio Management performance of Resident Individual and Non Resident Indian were 

clubbed till March 31, 2011. However, from April 1, 2011, the same has been shown 

separately. 

10) Nature of Expenses 

The following are the general costs and expenses to be borne by the Client availing the 

services by the Portfolio Manager. However, the exact nature of expenses relating to each 

of the following services is annexed to the Portfolio Management Agreement in respect of 

each of the services provided. 

(i) Portfolio Management and Advisory Fees 

This fee relates to the portfolio management services offered by Portfolio Manager 

(including advisory services) to the clients. The fee may be a Fixed Charge on the quantum 

of the funds being managed (or) charges linked to portfolio return (or) combination of both. 

For details kindly refer the annexure to this Risk Disclosure Document. 

29

(ii) Premature Redemption Charges 

If the redemption is done prematurely at the option of the client, the Portfolio Manager will 

levy the Premature Redemption Charges. For details kindly refer the annexure to this Risk 

Disclosure Document. 

(iii) Custodian/Depository Participant fee 

The charges relating to opening and operation of demat accounts, custody and transfer 

charges for shares, bonds and units, dematerialization and rematerialization, pledge and 

unpledged, etc. will be as per the actual charged by the Depository Participant/Custodian. 

For details kindly refer the annexure to this Risk Disclosure Document. 

(iv) Registrar and transfer agent fee 

Charges payable to the Registrar and Share Transfer Agents in connection with effecting 

transfer of securities and bonds, units, etc. including stamp charges, cost of affidavits, notary 

charges, postage/courier charges and other related charges will be recovered on actual. For 

details kindly refer the annexure to this Risk Disclosure Document. 

(v) Placement fee : 

A Placement fee not exceeding 3% on the investment value will be charged in some of the 

strategies over and above the fixed management fee and performance fee. For details kindly 

refer the annexure to this Risk Disclosure Document. 

(vi) Brokerage and transaction cost 

The Brokerage and other charges like Service tax, Stamp duty, Security Transaction 

Tax, SEBI Fees, Bank charges, Turnover tax, Foreign tax and other charges (if any), as per the 

rates existing from time to time, will be charged on actual. For details kindly refer the 

annexure to this Risk Disclosure Document. 

The investment by Portfolio Manager will be done through Karvy Stock Broking Limited 

{Stock Broker} or through any SEBI Registered stock broker only and would as per the rates 

negotiated between Portfolio Manager and the broker. The charges relating to brokerage as 

per the related party transactions charged by Karvy Stock Broking Limited or through any 

SEBI Registered stock broker will be recovered on actual by the Portfolio Manager 

(vii) Securities Lending and Borrowing Charges 

If utilized, the charges pertaining to lending of securities, cost of borrowing including interest 

and costs associated with transfer of securities connected with lending and borrowing 

transfer operations, Depository Participant Charges, Share Transfer Agent Charges, etc. 

would be recovered on actual. For details kindly refer the annexure to this Risk Disclosure 

Document. 

30

(viii) Certification Charges or Professional Charges 

Any charges payable for outsourced professional services like accounting, taxation, auditing, 

and any legal services, notarizations, etc., incurred on behalf of the Client by the Portfolio 

Manager, will be charged from the client on actual. For details kindly refer the annexure to 

this Risk Disclosure Document. 

(ix) Incidental Expenses 

Charges in connection with day to day operations like courier expenses, stamp duty, service 

tax, postal, telegraphic expenses, opening and operation of bank and demat accounts or any 

other out of pocket expenses incurred by the Portfolio Manager, on behalf of the client, 

would be recovered from the client. For details kindly refer the annexure to this Risk 

Disclosure Document. 

Note: For clients who have opened their PMS account with Karvy Stock Broking Limited prior 

to August 1, 2012, the performance fee will be computed on a High Watermark Principle 

over the life of the Investment at the end of every financial year on financial year basis. 

However, for clients who have opened their PMS accounts on or after August 1, 2012, the 

performance fees will be charged on completion of 12 months from account opening date 

(anniversary basis) and not financial year basis. 

11) Taxation 

General 

It may be noted that the information given hereinafter is only for general information 

purposes and is based on the advice received by the Portfolio Manager regarding the law 

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

fiscal rules or their interpretation may change or it may not be acceptable to the tax 

authorities. As is the case with any interpretation of any law, there can be no assurance that 

the tax position or the proposed tax position prevailing at the time of an investment in the 

strategy/plan/option will be accepted by the tax authorities or will continue to be accepted 

by them indefinitely. 

Further statements with regard to tax benefits mentioned herein below are mere 

expressions of opinion and are not representations of the Portfolio Manager to induce any 

investor to invest whether directly from the Portfolio Manager or indirectly from any other 

persons by the secondary market operations. In view of the above, and since the individual 

nature of tax consequences may differ in each case on its merits and facts, each Investor is 

advised to consult his / her or its own professional tax advisor with respect to the specific tax 

implications arising out of its participation in the PMS strategy/plan/option, as an investor. 

In view of the above, it is advised that the investors appropriately consult their investment / 

tax advisors in this regard. 

31

Portfolio Manager cannot be held responsible for assisting or completing the fulfillment of 

the client’s tax obligations. 

Income arising from purchase and sale of securities under Portfolio Management Services 

can give rise to business income or capital gains in the hands of the Client. The issue of 

characterization of income is relevant as the tax computation and rates differ in either of the 

two situations. The said issue is essentially a question of fact and depends on whether the 

shares are held as business trading assets or on capital account. Based on judicial decisions, 

the following factors need to be considered while determining the nature of assets as above: 

a. Motive for the purchase of securities 

b. Frequency of transactions 

c. Length of period of holding of the securities 

d. Treatment of the securities and profit or loss on their sale in the accounts of the assessee 

and disclosure in notes thereto 

e. Source of funds out of which the securities were acquired - borrowed or own 

f. Existence of an objects clause permitting trading in securities – relevant only in the case of 

corporate. 

g. Circumstances responsible for the sale of securities 

h. Acquisition of the securities -from primary market or secondary market Infrastructure and 

set - up employed for undertaking the securities transactions by the client 

Any single factor discussed above in isolation cannot be conclusive to determine the exact 

nature of the shares. All factors and principles need to be construed harmoniously. 

Investors may refer to CBDT instruction no. 1827 dated August 31, 1989 read with CBDT 

Circular no. 4 dated June 15, 2007 for further guidance on the matter. 

Tax implications under the Income Tax Act, 1961 ("IT Act") arise in the hands of the Clients 

(resident as well as the non-resident) under both the scenarios, viz: 

a. Securities in the Portfolio held as business asset; and 

b. Securities in the Portfolio held on capital account. 

Additionally, non-residents (including Flls) are entitled to be governed by the applicable 

Double Tax Avoidance Agreement ("DTAA), which lndia has entered into with the country of 

residence of the non-resident, if that is more beneficial. The same would have to be 

considered on a case-to-case basis depending upon the applicable DTAA. Ordinarily, capital 

gains and interest income are taxable in lndia in the manner and at the rates prescribed 

under the relevant DTAA or the relevant rates applicable in India, whichever is beneficial to 

the assessee. Further, business income is normally not taxable in lndia if there is no 

permanent establishment of the non-resident in India. 

32

Tax Deducted at Source 

Presently, tax is withheld at source for non-residents. If any tax is required to be withheld 

on account of any future legislation, Portfolio Manager shall be obliged to act in accordance 

with the regulatory requirements in this regard. Interest and dividends would be subject to 

tax as per the provisions of the Income Tax Act, 1961. 

Advance Tax installment obligations 

It shall be the client’s responsibility to meet the advance tax obligation installments payable 

on the due dates under the Income Tax Act, 1961. 

Long Term capital Gains 

Any investments held for 12 months or more than 12 months would be classified as Long 

Term Capital Assets. Gains arising out of such assets are called Long Term Capital Gains. 

With effect from 1 st October 2004, in terms of Section 10(38)of The Finance (No.2) Act, 2004, 

Long Term capital gains, arising on transfer of long term capital asset (equity share in a 

company or a unit of an equity oriented fund) is exempt from capital gains tax, provided the 

shares are sold on a recognized stock exchanges in India and such transactions are subjected 

to Securities Transaction Tax in accordance with Chapter VII of the Finance (No.2) Act, 2004 

and/or Income Tax Act, 1961. Clients are requested to check with their Tax Advisor on the 

applicable rates of tax, STT, surcharge and educational cess at any given point of time. 

Short Term Capital Gains 

Any investments held for less than 12 months would be classified as Short Term Capital asset 

and any gains arising out of such investment are called Short Term Capital Gains. Such gains 

would be added to the total income. With effect from 1 st April 2008, as per Section 111A of 

the Finance (No.2) Act, 2004, short term capital gains arising on transfer of short term 

capital asset (equity shares in a company or a unit of an equity oriented fund) are subject to 

tax @ 15% plus applicable surcharge and educational cess, provided the shares are sold on a 

recognized stock exchange in India and such transactions are subjected to Securities 

Transaction Tax in accordance with Chapter VII of the Finance (No.2) Act, 2004 and/or 

Income Tax Act, 1961. Clients are requested to check with their Tax Advisor on the 

applicable rates of tax, STT, surcharge and educational cess at any given point of time. 

Securities Transaction Tax 

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

(a) Purchase or sale of an equity share of a listed companies (whether delivery based or nondelivery 

based) or a derivative or a unit of an equity oriented fund, entered into in a 

recognized stock exchange; or 

33

(b) Sale of a Unit of an equity oriented fund to the Unit Trust of India or Mutual Fund. 

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

the Income Tax Act, 1961 if STT is not applicable in respect of such transactions. 

Capital loss 

Losses under the head 'capital gains' cannot be set off against income under any other head. 

Further, within the head 'capital gains', long-term capital losses cannot be adjusted against 

short-term capital gains. However, short-term capital losses can be adjusted against any 

capital gains. Unabsorbed long-term capital loss can be carried forward and set off against 

the long-term capital gains arising in subsequent eight assessment years. Unabsorbed shortterm 

capital loss can be carried forward and set off against the income under the head 

capital gains in subsequent eight assessment years. 

12) Accounting policies 

The following is the accounting policy followed by Portfolio Manager while accounting for 

the portfolio investments of the clients. 

Investment in equities will be valued on the closing price of that equity at NSE. In case of any 

investments done in any equity listed on BSE only, the same will be valued based on the 

closing price of that equity in BSE. 

For valuation of the derivatives contract, the open positions, as on the date of valuation, will 

be valued on the mark to market method. 

In case of Mutual Fund, the valuation will be done on the repurchase Net Asset Value (NAV) 

declared for the relevant plan, on the date of valuation of portfolio (or) date of the report 

(or) any cut off date. 

Investment in debt instruments will be valued at the market value of the debt instrument as 

on cut off date (or) the latest available price on the relevant exchange or the most recent 

NAV will be reckoned. 

Realised gains/losses will be calculated on the basis of First in First out (FIFO) basis. 

Transaction date will be the trade date and not the settlement or auction date. 

For derivatives transactions (if any), the unrealized gains/losses on open position will be 

calculated on the mark to market method. 

Unrealized gain/losses means the profit/loss not yet booked and the same will be the 

difference of the current market price or NAV minus the actual purchase price (or) the 

historical cost of the securities. 

34

All income will be accounted on accrual or receipt basis, whichever is earlier. All expenses 

will be accounted on due or payment basis, whichever is earlier. 

Purchase and sale transactions are accounted for on contract date basis. 

Cost of purchase and sale includes consideration for scrip and brokerage but excludes 

Securities Transaction Tax, Service Tax & other charges paid on purchase/sale of securities. 

Other expenses like Custodian charges (Safe keeping charges, Transaction charges, Fund 

Accounting charges, Out of Pocket expenses) are accounted for as & when debited by the 

Custodian. 

Any corporate benefits like dividend on shares, Mutual Fund units, interest on debt 

instruments, stock lending fees etc. shall be accounted on accrual basis except interim 

dividend which would be accounted on receipt basis. 

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

Dividend income is recorded on the ex-dividend date (ex-date) 

Tax deducted at source on interest on Fixed Deposits/Dividend is considered as withdrawal 

of corpus and debited accordingly. 

Portfolio Manager and the Client, on case to case basis, can mutually agree to any specific 

norms or methodology for valuation of investment and/or accounting 

The Client may contact the Portfolio Manager for the purpose of clarifying or elaborating on 

any of the above. 

13) Investors services 

Investor Relations Officer – IRO 

The below mentioned employee has been nominated as the Investor Relations Officer by 

Portfolio Manager who will attend to the investor queries and complaints: 

Mr.Dhaval P.Upadhyay 

Karvy Stock Broking Ltd. 

701, Hallmark Business Plaza, 

Sant Dnyaneshwar Marg, Bandra (E), 

Mumbai 400 051. 

Tel No. (B) 022-33055000 Tel No. (D) 022-61491621 

Fax No. 022-33055033 

Email ID – dhaval.upadhyay@karvy.com 

35

ANNEXURE A 

A. Discretionary Portfolio Management Services 

1. K-Sensible 

Introduction 

The K-Sensible Portfolio is designed for those investors who want steady long-term capital returns, 

who have patience to hold their investments over a long term horizon. 

Investment Objective 

The investment objective of the Strategy is to provide capital growth and benefits of long term 

investments. Investments would be made in companies which have a strong management, quality 

and growth oriented business. 

Investment Horizon and Risk Return Profile 

This Portfolio is recommended for investors seeking to hold a diversified equity portfolio with 

moderate risk appetite expecting a moderate return over medium term horizon. 

Asset Allocation 

The Portfolio will seek to remain substantially invested in Equities or Equities related instruments at 

all times. The cash in the portfolio may be invested in Liquid Funds or Liquid Bees. 

Securities 

Investments will be made in Stocks, Mutual Funds and Exchange Traded Funds (ETF). The Portfolio 

will also use derivative instruments – Futures and Options – for hedging and rebalancing of the 

portfolio. Derivative Instruments shall, however, not be used in case of NRI investors. 

Investment in equities will be valued on the closing price of that equity at NSE. In case of 

investments in any stocks listed on BSE only, the same will be valued based on the closing price of 

that equity in BSE. Investment in “Futures and Options”, used for hedging, shall be valued at actual 

cash margins paid against F&O contracts, summed with Mark to Market profit / loss computed on 

the basis of closing price of such contracts. 

Fees and Expenses 

PLACEMENT FEE: A placement fee not exceeding 3% on the investment will be charged over and 

above the Fixed Management Fee and Performance fee as defined below. 

Clients have the below fee options: 

Option 1: Fixed Management Fee upto 2.50% p.a. 

FIXED MANAGEMENT FEE: The Fixed fees for the K-Sensible Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 2.50% p.a. charged @ 0.625% at the end of every 

quarter on the daily average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank 

balance). 

In case of, withdrawal before 12 months a fixed fee of 2.5% will be charged on a full year basis. 

1

Option 2: Fixed Management Fee up to 1.00% p.a. & Performance fee of 20% 

FIXED MANAGEMENT FEE: The Fixed fees for the K-Sensible Portfolio (with profit sharing) charged by 

the Portfolio Manager will not exceed 1.00% p.a. charged @ 0.25% at the end of every quarter on 

the daily average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 

PERFORMANCE FEE: The Performance fees charged will not exceed 20% of incremental gains beyond 

annualized hurdle rate not exceeding 10% on the basis of High Water Mark Principle over the life of 

the investment. The performance fee will be computed at the end of every financial year on financial 

year basis. 

However, in case of withdrawal before 12 months, the higher of : a) 20% performance fee and 1.0% 

flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 

Option 3: Fixed Management Fee up to 1.5% p.a. & Performance fees up to 20% 

FIXED MANAGEMENT FEE: The Fixed fee for the K-Sensible Portfolio (with profit sharing) will not 

exceed 1.5% p.a. which is @ 0.375% at the end of every quarter on the daily average Net Asset Value 

of the Portfolio (inclusive of all securities and cash/bank balance). 

PERFORMANCE FEE: The Performance fee in this option will not exceed 20% of incremental gains 

beyond annualized hurdle rate not exceeding 12% on the basis of High Water Mark Principle over the 

life of the investment. The performance fee will be computed at the end of every financial year on 

financial year basis. However, in case of withdrawal before 12 months, the higher of : a) 20% 

performance fee and 1.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year 

basis. 

Option 4: Only available if Initial Investment is greater than Rs. 1 Crore - Fixed Management Fee up 

to 2.0% p.a. 

If the initial investment is greater than Rs. 1 Crore, the investor also has an option, where Fixed 

management fee charged will not exceed 2.0% p.a. which is @ 0.50% at the end of every quarter on 



Option 5: Fixed Management Fee NIL & Performance fees up to 15% on all gains 

The Performance fees will not exceed 15% of incremental gains beyond annualized hurdle rate of 0% 

on the basis of High Water Mark Principle over the life of the investment. The performance fee will 

be computed at the end of every financial year on financial year basis. However, in case of 

withdrawal before 12 months: a) the higher of the 15% performance fee or b) the fixed fee of 2.5% 

will be charged on a full year basis. 

Option 6: Only available if Initial Investment is greater than Rs. 1 Crore - Fixed Management Fee up 

to 0.5% p.a. & Performance fees up to 15% 

FIXED MANAGEMENT FEE: If the initial investment is greater than Rs. 1 Crore, the investor has an 

option, where Fixed management fee charged will not exceed 0.5% p.a. which is @ 0.125% at the 

2

end of every quarter on the daily average Net Asset Value of the Portfolio (inclusive of all securities 

and cash/bank balance). 

PERFORMANCE FEE: The Performance fee in this option is not exceeding 15% of incremental gains 

beyond annualized hurdle rate of 0% on the basis of High Water Mark Principle over the life of the 

investment. The performance fee will be computed at the end of every financial year on financial 

year basis. However, in case of withdrawal before 12 months: a) the higher of the 15% performance 

fee and 0.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 

Other Features 

Minimum investment amount is Rs. 25 Lakhs. 

The Portfolio Manager shall charge audit fees, custodial/ AMC charges and other charges/costs, 

attributable to the Portfolio Management Services at actual. 

The Client will also have to bear brokerage not exceeding 2.50% of the transaction value and other 

incidental charges/fees/duties and taxes including Securities Transaction Tax at actual. 

The Client may withdraw whole or part of the Funds or securities from the Portfolio Account by 

giving advance notice and the Portfolio Manager will endeavor to liquidate the securities held in the 

Strategy and return the funds or securities of the Strategy, as the case may be, to the Client within 

reasonable time. The Client will not withdraw funds given earlier than 12 months from date of 

providing the same and in the event of a withdrawal earlier than 12 months; the complete fixed 

management fee or a combination of performance fee and fixed management whichever is higher 

will be charged, as applicable, on the funds or securities withdrawn, on a full year basis. 

The Portfolio Manager will provide periodical reports as required under the Regulations at the 

communication address provided by the client at time of account opening. In case Portfolio Manager 

is unable to provide the periodic reports in physical copy, the same shall be provided to clients via 

email at the email id registered by clients at time of account opening. 

The Portfolio Account will be audited by the Independent Chartered Accountant every year and copy 

of the Certificate issued by the Chartered Accountant will be given to the Client. 

2.K-Aggressive 

Introduction 

The K-Aggressive portfolio is designed to provide a balance between growth, safety and returns. This 

is achieved by investing in well-researched companies and employing a strategy of systematic profit 

booking. 


The investment objective of the Strategy is to provide a balance between growth, safety and returns. 

In our stock selection process we will continue to focus on companies which qualify in the three key 

attributes – Management, Business and Valuation. 




3




Securities 




Investment in equities will be valued on the closing price of that equity at NSE. In case of investments 

in any stocks listed on BSE only, the same will be valued based on the closing price of that equity in 

BSE. Investment in “Futures and Options”, used for hedging, shall be valued at actual cash margins 

paid against F&O contracts, summed with Mark to Market profit / loss computed on the basis of 

closing price of such contracts. 


A placement fee not exceeding 3% on the investment will be charged over and above the Fixed 

Management Fee and Performance fee as defined below. 


The Fixed fees for the K-Aggressive Portfolio (without profit sharing) charged by the Portfolio 

Manager will not exceed 2.50% p.a. charged @ 0.625% at the end of every quarter on the daily 

average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 


Option 2: Fixed Management Fee upto 1.00% p.a. & Performance fee upto 20% 

The Fixed fees for the K-Aggressive Portfolio (with profit sharing) charged by the Portfolio Manager 

will not exceed 1.00% p.a. charged @ 0.25% at the end of every quarter on the daily average Net 

Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 

The Performance fees charged will not exceed 20% of incremental gains beyond annualized hurdle 

rate not exceeding 10% on the basis of High Water Mark Principle over the life of the investment. 

The performance fee will be computed at the end of every financial year on financial year basis. 



Option 3: Fixed Management Fee upto 1.5% p.a. & Performance fees upto 20% 

The Fixed fee for the K-Aggressive Portfolio (with profit sharing) will not exceed 1.5% p.a. which is @ 

0.375% at the end of every quarter on the daily average Net Asset Value of the Portfolio (inclusive of 

all securities and cash/bank balance). 

The Performance fee in this option will not exceed 20% of incremental gains beyond annualized 

hurdle rate not exceeding 12% on the basis of High Water Mark Principle over the life of the 


year basis. However, in case of withdrawal before 12 months, the higher of : a) 20% performance fee 

and 1.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 

4

Option 4: Only available if Initial Investment is greater than Rs. 1 Crore - Fixed Management Fee upto 

2.0% p.a. 





Option 5: Fixed Management Fee NIL & Performance fees upto 15% on all gains 







0.5% p.a. & Performance fees upto 15% 

If the initial investment is greater than Rs. 1 Crore, the investor has an option, where Fixed 



The Performance fee in this option is not exceeding 15% of incremental gains beyond annualized 

hurdle rate of 0% on the basis of High Water Mark Principle over the life of the investment. The 

performance fee will be computed at the end of every financial year on financial year basis. 

However, in case of withdrawal before 12 months: a) the higher of the 15% performance fee and 

0.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 










reasonable time. The Client will not withdraw funds given earlier than 12 months from providing the 

same and in the event of a withdrawal earlier than 12 months; the complete fixed management fee 

or a combination of performance fee and fixed management whichever is higher will be charged, as 

applicable, on the funds or securities withdrawn, on a full year basis. 





5



3. K-Energetic 

Introduction 

The K-Energetic portfolio is designed to provide returns by following an aggressive style of investing 

which entails higher risks. 


The investment objective of the Strategy is to provide blend of absolute returns and capital 

appreciation with aggressive fund management. In our stock selection process we continue to focus 

on business, management and valuation. 


This Portfolio is recommended for investors seeking to hold a diversified equity portfolio with high 

risk appetite expecting a high return over medium term horizon. 




Securities 








closing price of such contracts 





The Fixed fees for the K-Energetic Portfolio (without profit sharing) charged by the Portfolio Manager 

will not exceed upto 2.50% p.a. charged @ 0.625% at the end of every quarter on the daily average 

Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 


Option 2: Fixed Management Fee upto 1.00% p.a. & Performance fee upto 20% 

The Fixed fees for the K-Energetic Portfolio (with profit sharing) charged by the Portfolio Manager 

will not exceed 1.00% p.a. charged @ 0.25% at the end of every quarter on the daily average Net 


6

The Performance fees charged will not exceed 20% of incremental gains beyond annualized hurdle 

rate not exceeding 10% on the basis of High Water Mark Principle over the life of the investment. 

The performance fee will be computed at the end of every financial year on financial year basis. 



Option 3: Fixed Management Fee upto 1.5% p.a. & Performance fees upto 20% 

The Fixed fee for the K-Energetic Portfolio (with profit sharing) will not exceed 1.5% p.a. which is @ 






year basis. However, in case of withdrawal before 12 months, the higher of : a) 20% performance fee 

and 1.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 


2.0% p.a. 












0.5% p.a. & Performance fees upto 15% 

If the initial investment is greater than Rs. 1 Crore, the investor has an option, where Fixed 



The Performance fee in this option is not exceeding 15% of incremental gains beyond annualized 

hurdle rate of 0% on the basis of High Water Mark Principle over the life of the investment. The 

performance fee will be computed at the end of every financial year on financial year basis. 

However, in case of withdrawal before 12 months: a) the higher of the 15% performance fee and 

0.5% flat fixed fee or b) a flat fixed fee of 2.5% will be charged on a full year basis. 



7










reasonable time. The Client will not withdraw funds given earlier than 12 months and in the event of 

a withdrawal earlier than 12 months; the complete fixed management fee or a combination of 

performance fee and fixed management whichever is higher will be charged, as applicable, on the 

funds or securities withdrawn, on a full year basis. 







4.Alpha Portfolio 

Introduction 

The Alpha Portfolio is designed for those investors who seek long-term capital appreciation from 

their asset allocation to equities. The portfolio will invest in stocks across sectors, market 

capitalization categories and investment themes. 


The investment objective of the strategy is to generate growth of capital and excess returns over the 

benchmark index through long term investing. Investments would be made in companies which have 

a strong and sustainable business model and are growth oriented. 







8

Securities 






that equity in BSE. Investment in “Futures and Options”, used for hedging, shall be valued at actual 

cash margins paid against F&O contracts, summed with Mark to Market profit / loss computed on 

the basis of closing price of such contracts. 


A placement fee not exceeding 3.00% on the investment will be charged over and above the Fixed 


The Fixed fees for the Alpha Portfolio charged by the Portfolio Manager will be charged at the end of 

every quarter on the daily average Net Asset Value of the Portfolio (inclusive of all securities and 

cash/bank balance). For existing clients, the performance fee will be computed on a High Watermark 

Principle over the life of the Investment at the end of every financial year on financial year basis. 

From 1 st August, 2012, for new clients the performance fees will be charged on completion of 12 

months (anniversary basis) and not financial year basis. The investor has the following fee options: 


FIXED MANAGEMENT FEE: The Fixed fee for the Alpha Portfolio (without profit sharing) charged by 

the Portfolio Manager will not exceed 3.00% p.a. charged upto 0.75% at the end of every quarter on 


Following charges shall be payable by client upon withdrawal from Alpha Portfolio under Option 1: 

Withdrawal when made 

In case of withdrawal before 12 months of date 

from which client account is activated 

In case of withdrawal after 12 months but before 

completion of 24 months of date from which 

client account is activated 




When exiting, after completing a period of 36 

months of date from which client account is 

activated 

Charges payable by Client 

a) Fixed Management Fee up to 3% p.a. and 

b) Exit fees up to 3% 



a) Fixed Management Fee upto 3% p.a. and 


Fixed management fee up to 3% p.a. till the day 

the client exits the portfolio. 




9

life of the investment. For existing clients, the performance fee is being computed on a High 

Watermark Principle over the life of the Investment at the end of every financial year on financial 

year basis. From 1 st August, 2012, for new clients the performance fees is being charged on 

completion of 12 months (anniversary basis) and not financial year basis. 

Following charges shall be payable by client upon withdrawal from Alpha Portfolio under Option 2: 





a) Performance fee up to 25% of 

incremental gains beyond annualized 

hurdle rate not exceeding 0% will be 

charged (Performance fee payable will be 

calculated on the NAV on the day of exit) 

and 

b) Exit fees up to 3% will be charged. 




a) Performance fee up to 25% of 

incremental gains beyond annualized hurdle 

rate not exceeding 0% on the basis of High 

Water Mark Principle will be charged 

(Performance fee payable will be calculated 

on the NAV on the day of exit) and 

b) Exit fees up to 2% will be charged 




a) Performance fee up to 25% of incremental 

gains beyond annualized hurdle rate not 

exceeding 0% on the basis of High Water 

Mark Principle will be charged (Performance 

fee payable will be calculated on the NAV on 

the day of exit) and 




activated 

Performance Fee up to 25% of incremental gains 

beyond annualized hurdle rate not exceeding 0% 

on the basis of High Water Mark Principle based 

on the NAV of the day of exit. 

Option 3: Fixed Management Fee up to 3% p.a. & Performance fees up to 25% 

FIXED MANAGEMENT FEE: The Fixed fee for the Alpha Portfolio (with profit sharing) will not exceed 

3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset Value of 

the Portfolio (inclusive of all securities and cash/bank balance). 

10



life of the investment. For existing clients, the performance fee will be computed on a High 




Following charges shall be payable by client upon withdrawal from the Alpha Portfolio under option 

3: 




Additional charges payable 

a) Fixed management fee payable up to 

3.00% p.a and Performance fee payable 

up to 25% of incremental gains beyond 

annualized hurdle rate not exceeding 12% 

will be charged (Performance fee payable 

will be calculated on the NAV on the day 

of exit) and 





a) Fixed management fee payable up to 

3.00% p.a. and Performance fee payable 

up to 25% of incremental gains beyond 

annualized hurdle rate not exceeding 12% 

on the basis of High Water Mark Principle 

will be charged (Performance fee payable 

will be calculated on the NAV on the day 

of exit) and 





a) Fixed management fee payable up to 3.00% 

p.a. and Performance fee payable up to 25% 

of incremental gains beyond annualized 

hurdle rate not exceeding 12% on the basis of 

High Water Mark Principle will be charged 

(Performance fee payable will be calculated 





activated 

a) Fixed Management fee upto 3% p.a. and 

b) Performance Fee up to 25% of 

incremental gains beyond annualized 

hurdle rate not exceeding 12% on the 

basis of High Water Mark Principle based 

on the NAV of the day of exit. 

11

The Portfolio Manager shall charge audit fees, custodial/AMC charges and other charges/costs, 


The Client will also have to bear brokerage charges not exceeding @2.50% of the transaction value 

and other incidental charges/fees/duties and taxes including Securities Transaction Tax at actual. 






reasonable time. 







5. Delta Portfolio 

The Delta Portfolio is designed for those investors who seek long-term capital appreciation from 

their asset allocation to equities and debt. The portfolio will invest in mutual funds across sectors, 

market capitalization categories and investment themes. 


The investment objective of the Strategy is to generate long term capital appreciation of wealth 

through a portfolio of debt and equity related mutual funds which are rebalanced regularly and the 

allocation between debt and equity is done on the basis of the risk profile of the investor 

(conservative, moderate or aggressive). 

Delta – Conservative will have a conservative allocation towards debt and equity. 

Delta – Moderate will have a moderate allocation towards debt and equity. 

Delta – Aggressive will have an aggressive allocation towards debt and equity. 


Delta Aggressive portfolio is recommended for investors seeking to hold a diversified equity 

portfolio with moderate risk appetite expecting a moderate return over medium term horizon. 

Delta Moderate and conservative portfolios are recommended for investors seeking to hold a 

diversified equity and debt portfolio with moderate risk appetite expecting a moderate return over 

medium term horizon. 

12


The amount of Portfolio invested in Equity related Mutual Fund will be between 0% - 100% of the 

Portfolio. The balance of Portfolio will be invested in debt related Mutual Funds. The idle cash will be 

invested in Liquid funds or Liquid bees. 

Note: The amount of Portfolio invested in Equity related Mutual Fund has been changed from 30% - 

100% of the Portfolio to 0 to 100 with effect from February 1, 2013. The said change in asset 

allocation shall be applicable prospectively only for new clients subscribing to the Strategy. Asset 

allocation of existing clients of the Strategy shall remain unchanged. 

Securities 

Investments will be made in Mutual Funds and Exchange Traded Funds (ETF). The Portfolio will also 

use derivative instruments – Futures and Options – for hedging and rebalancing of the portfolio. 

Derivative Instruments shall, however, not be used in case of NRI investors. 

Investment in Mutual Funds will be valued on the day end’s NAV. Investment in “Futures and 

Options”, used for hedging, shall be valued at actual cash margins paid against F&O contracts, 

summed with Mark to Market profit / loss computed on the basis of closing price of such contracts. 




The Fixed fees for the Delta Portfolio charged by the Portfolio Manager will be charged at the end of 


cash/bank balance).For existing clients, the performance fee will be computed on a High Watermark 



months (anniversary basis) and not financial year basis. . 















13



Below are the fee options available to an investor: 

DELTA Conservative: 


The Fixed fee for the Delta Conservative Portfolio (without profit sharing) charged by the Portfolio 

Manager will not exceed 3.00% p.a. charged upto 0.75% at the end of every quarter on the daily 

average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 

Following charges shall be payable by client upon withdrawal from the strategy under Option 1: 


In case of withdrawal before 12 months of 

date from which client account is activated 

In case of withdrawal after 12 months but 

before completion of 24 months of date from 

which client account is activated 

In case of withdrawal after 24 months but 

before completion of 36 months of date from 


After completing 36 months of date from 









The client will be charged fixed management fee up 

to 3% p.a. till the day client exits the strategy. 


PERFORMANCE FEE: The Performance fee in this Delta Conservative option will not exceed 25% of 

incremental gains beyond annualized hurdle rate not exceeding 0% on the basis of High Water Mark 

Principle over the life of the investment. For existing clients, the performance fee will be computed 

on a High Watermark Principle over the life of the Investment at the end of every financial year on 

financial year basis. From 1 st August, 2012, for new clients the performance fees is being charged on 


Following charges shall be payable by client upon withdrawal from the Delta Conservative Portfolio 

under Option 2: 


In case of withdrawal before 


a) Performance fee up to 25% of incremental gains beyond 

14

12 months of date from which 


annualized hurdle rate not exceeding 0% will be charged 

(Performance fee payable will be calculated on the NAV on the 

day of exit) and 


In case of withdrawal after 12 

months but before completion 

of 24 months of date from 

which client account is 

activated 





activated 

After completing 36 months of 

date from which client account 

is activated 


annualized hurdle rate not exceeding 0% on the basis of High 

Water Mark Principle will be charged (Performance fee payable 

will be calculated on the NAV on the day of exit) and 







Performance Fee up to 25% of incremental gains beyond 


Water Mark Principle based on the NAV of the day of exit from the 

strategy. 


FIXED MANAGEMENT FEE: The Fixed fee for the Delta Conservative portfolio (with profit sharing) will 

not exceed 3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset 

Value of the Portfolio (inclusive of all securities and cash/bank balance). 









.Following charges shall be payable by client upon withdrawal from the Delta Conservative Portfolio 



In case of withdrawal before 


a) Fixed management fee payable up to 3.00% p.a and 

15



b) Performance fee payable up to 25% of incremental gains 

beyond annualized hurdle rate not exceeding 12% will be 

charged (Performance fee payable will be calculated on the 

NAV on the day of exit) and 

c) Exit fees up to 3% 





activated 





activated 

After completing 36 months of 

date from which client account 

is activated 

a) Fixed management fee payable up to 3.00% p.a. and 


beyond annualized hurdle rate not exceeding 12% on the 

basis of High Water Mark Principle will be charged 

(Performance fee payable will be calculated on the NAV on 









c) Exit fees up to 1% will be charged. 


b) Performance Fee up to 25% of incremental gains beyond 

annualized hurdle rate not exceeding 12% on the basis of 

High Water Mark Principle based on the NAV of the day of 

exit. 

DELTA Moderate: 


PLACEMENT FEE: A placement fee not exceeding 3.00% on the investment will be charged over and 


FIXED MANAGEMENT FEE: The Fixed fees for the Delta Moderate Portfolio charged by the Portfolio 

Manager will be charged at the end of every quarter on the daily average Net Asset Value of the 

Portfolio (inclusive of all securities and cash/bank balance). 

PERFORMANCE FEE: The performance fee will be computed on a High Watermark Principle over the 

life of the Investment at the end of every financial year on financial year basis. 

16

Clients have the following fee options: 


FIXED MANAGEMENT FEE: The Fixed fee for the Delta Moderate Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 3.50% p.a. charged upto 0.875% at the end of 


cash/bank balance). 

Following charges shall be payable by client upon withdrawal from the Delta Moderate Portfolio 



In case of withdrawal before 12 

months of date from which client 

account is activated 

In case of withdrawal after 12 months 

but before completion of 24 months 

of date from which client account is 

activated 




activated 

When exiting, after completing a 

period of 36 months of date from 



a) Fixed Management Fee up to 3.50% p.a. and 




a) Fixed Management Fee upto 3.50% p.a. and 

b) b) Exit fees up to 1% 

Fixed management fee up to 3.50% p.a. till the day client 

exits the portfolio. 




life of the investment For existing clients, the performance fee will be computed on a High 


year basis. From 1 st August, 2012, for new clients the performance fees is beingcharged on 














17




activated 




activated 




a) Performance fee up to 25% of incremental gains 

beyond annualized hurdle rate not exceeding 0% on 

the basis of High Water Mark Principle will be 

charged (Performance fee payable will be calculated 





High Water Mark Principle will be charged (Performance fee 

payable will be calculated on the NAV on the day of exit) and 





exit from the portfolio. 


FIXED MANAGEMENT FEE: The Fixed fee for the Delta Moderate Portfolio (with profit sharing) will 

not exceed 3.50% p.a. which is upto 0.875% at the end of every quarter on the daily average Net 


















b) Performance fee payable up to 25% of incremental 

gains beyond annualized hurdle rate not exceeding 

12% will be charged (Performance fee payable will be 

calculated on the NAV on the day of exit) and 

c) b) Exit fees up to 3% 




18


activated 




activated 






12% on the basis of High Water Mark Principle will be 




a) Fixed management fee payable up to 3.50% p.a. 

and 

b) Performance fee payable up to 25% of 

incremental gains beyond annualized hurdle rate 

not exceeding 12% on the basis of High Water 

Mark Principle will be charged (Performance fee 

payable will be calculated on the NAV on the day 

of exit) and 


a) Fixed Management fee upto 3.50% p.a. and 

b) Performance Fee up to 25% of incremental gains 


the basis of High Water Mark Principle based on the 

NAV of the day of exit. 

DELTA Aggressive: 




FIXED MANAGEMENT FEE: The Fixed fees for the Delta Aggressive Portfolio charged by the Portfolio 

Manager will be charged at the end of every quarter on the daily average Net Asset Value of the 


PERFORMANCE FEE: For existing clients, the performance fee will be computed on a High 


year basis. From 1 st August, 2012, for new clients the performance fees will be charged on 

completion of 12 months (anniversary basis) and not financial year basis. The investor has the 

following fee options: 


FIXED MANAGEMENT FEE: The Fixed fee for the Delta Aggressive Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 4.00% p.a. charged upto 1.00% at the end of every 


balance). 

19

Following charges shall be payable by client upon withdrawal from the Delta Aggressive Portfolio 









activated 




activated 











Fixed management fee up to 4% p.a. till the day client exits 

the portfolio. 


PERFORMANCE FEE: The Performance fee in this Delta Aggressive fee option will not exceed 25% of 


Principle over the life of the investment. For existing clients, the performance fee is being computed 



















activated 





b)Exit fees up to 2% 

20




activated 












exit. 

Liability of a client shall not exceed client’s investment with the portfolio manager. 


FIXED MANAGEMENT FEE: The Fixed fee for the Delta Aggressive Portfolio (with profit sharing) will 







year basis. From 1 st August, 2012, for new clients, the performance fees is being charged on 









a) Fixed management fee payable up to 4.00% p.a 

and 


incremental gains beyond annualized hurdle 

rate not exceeding 12% will be charged 

(Performance fee payable will be calculated on 

the NAV on the day of exit) and 





activated 



gains beyond annualized hurdle rate not exceeding 12% 

on the basis of High Water Mark Principle will be 

charged (Performance fee payable will be calculated on 

21






activated 















NAV of the day of exit from the portfolio. 


For all portfolios and options provided, the Portfolio Manager shall charge audit fees, custodial/ AMC 

charges and other charges/costs, attributable to the Portfolio Management Services at actual. 



6. Omega Portfolio 

The Omega Portfolio is designed for those investors who seek long-term capital appreciation from 

their asset allocation to equities, debt, gold and other asset classes which are available through 

either exchange traded products or through mutual funds. 



through a portfolio of debt, equity, gold ETFs and other asset classes which are available through 

either exchange traded products or through mutual funds, which is rebalanced regularly and the 

allocation amongst the asset classes is done on the basis of the risk profile of the investor (moderate 

or aggressive). 

Omega – Conservative will have a conservative allocation towards debt, gold and equity 

Omega – Plus will have a dynamic allocation towards debt, gold and equity and may be fully invested 

in a particular asset class at a specific time depending on the investor profile. {Omega Plus strategy 

has replaced the erstwhile Omega Conservative strategy with effect from February 1, 2013} 

Omega – Moderate will have a moderate allocation towards debt, gold and equity. 

Omega – Aggressive will have an aggressive allocation towards debt, gold and equity. 

22

Omega – Systematic Equity will primarily be investing into Equity and Equity related instruments 

{Omega Systematic Equity shall be introduced with effect from February 15, 2013} 

Omega – Systematic Multi asset will have an allocation across multiple asset classes 

{Omega Systematic Multi Asset shall be introduced with effect from February 15, 2013} 


Omega conservative portfolio is recommended for investors seeking to hold a diversified multi asset 

portfolio with low risk appetite expecting a moderate return over a long term horizon. 

Omega moderate and Aggressive portfolios are recommended for investors seeking to hold a 

diversified multi asset portfolio with moderate risk appetite expecting a moderate return over 

medium term horizon. 

Omega Plus is recommended for investors seeking to hold a diversified portfolio with moderate risk 

appetite expecting a moderate return over medium term horizon. 

Omega Systematic Equity is recommended for investors seeking to hold a diversified equity portfolio 

with moderate risk appetite expecting a moderate return over medium term horizon. 

Omega Systematic Multi asset portfolio is recommended for investors seeking to hold a portfolio 

diversified across multiple asset classes with moderate risk appetite expecting a moderate return 

over medium term horizon. 


The amount of Portfolio invested in Equity will be between 0% - 100% of the Portfolio. 

The amount of Portfolio invested in Debt will be between 0% - 100% of the Portfolio. 

The amount of Portfolio invested in Gold ETFs will be between 0% - 100% of the Portfolio. 

The amount of Portfolio invested in other asset classes of Exchange Traded Products or Mutual Funds 

will be between 0% - 100% of the Portfolio. 

Note: The asset allocation for the Omega strategy has been changed with effect from February 1, 

2013. The said change in asset allocation shall be applicable prospectively only for new clients 

subscribing to the Strategy. Asset allocation of existing clients of the Strategy shall remain 

unchanged. 

Securities 

Investments will be made in Stocks, Mutual Funds, Exchange Traded Funds (ETF), Non-Convertible 

Debentures, and Bonds. The Portfolio will also use derivative instruments – Futures and Options – for 

hedging and rebalancing of the portfolio. Derivative Instruments shall, however, not be used in case 

of NRI investors. 



that equity at BSE. Investment in Mutual Funds and ETFs will be valued on the day end’s NAV. 

Investment in NCDs, bonds and other debt Instruments will be valued at closing price, if listed, or as 

per valuation provided by the issuer. Investment in “Futures and Options”, used for hedging, shall be 

23

valued at actual cash margins paid against F&O contracts, summed with Mark to Market profit / loss 

computed on the basis of closing price of such contracts. 




FIXED MANAGEMENT FEE: The Fixed fees for the Omega Portfolio charged by the Portfolio Manager 

will be charged at the end of every quarter on the daily average Net Asset Value of the Portfolio 

(inclusive of all securities and cash/bank balance). 

PERFORMANCE FEE: For existing clients, the performance fee will be computed on a High 





Minimum investment amount is Rs. 25lakh. 











OMEGA Conservative: 

Option 1: Fixed Management Fee upto 3% p.a. 

The Fixed fee for the Omega Conservative Portfolio (without profit sharing) charged by the Portfolio 

Manager will not exceed 3% p.a. charged upto 0.75% at the end of every quarter on the daily average 


However, in case of withdrawal before 12 months of a) Fixed Management Fee up to 3% p.a. and b) 

Exit fees up to 3% will be charged. In case of withdrawal after 12 months but before completion of 24 

months of a) Fixed Management Fee up to 3% p.a. and b) Exit fees up to 2% will be charged. In case 

of withdrawal after 24 months but before completion of 36 months, the a) Fixed Management Fee 

upto 3% p.a. and b) Exit fees up to 1% will be charged. After completing 36 months, the client will be 

charged fixed management fee up to 3% p.a. till the day he exits. 

Liability of a client shall not exceed client’s investment with the portfolio manager 


24

The Performance fee in this Omega Conservative option will not exceed 25% of incremental gains 





completion of 12 months (anniversary basis) and not financial year basis 

However, in case of withdrawal before 12 months a) Performance fee up to 25% of incremental gains 

beyond annualized hurdle rate not exceeding 0% will be charged (Performance fee payable will be 

calculated on the NAV on the day of exit) and b) Exit fees up to 3% will be charged. In case of 

withdrawal after 12 months but before completion of 24 months a) Performance fee up to 25% of 


Principle will be charged (Performance fee payable will be calculated on the NAV on the day of exit) 

and b) Exit fees up to 2% will be charged. In case of withdrawal after 24 months but before 

completion of 36 months a) Performance fee up to 25% of incremental gains beyond annualized 

hurdle rate not exceeding 0% on the basis of High Water Mark Principle will be charged 

(Performance fee payable will be calculated on the NAV on the day of exit) and b) Exit fees up to 1% 

will be charged. When exiting, after completing a period of 36 months, the client will be charged 

Performance Fee up to 25% of incremental gains beyond annualized hurdle rate not exceeding 0% on 

the basis of High Water Mark Principle based on the NAV of the day of exit. 


The Fixed fee for the Omega Conservative Portfolio (with profit sharing) will not exceed 3% p.a. 

which is upto 0.75% at the end of every quarter on the daily average Net Asset Value of the Portfolio 

(inclusive of all securities and cash/bank balance). The Performance fee in this option will not exceed 

25% of incremental gains beyond annualized hurdle rate not exceeding 12% on the basis of High 

Water Mark Principle over the life of the investment. For existing clients, the performance fee will be 

computed on a High Watermark Principle over the life of the Investment at the end of every financial 

year on financial year basis. From 1 st August, 2012, for new clients the performance fees will be 

charged on completion of 12 months (anniversary basis) and not financial year basis 

However, in case of withdrawal before 12 months a) Fixed management fee payable up to 3% p.a 

and Performance fee payable up to 25% of incremental gains beyond annualized hurdle rate not 

exceeding 12% will be charged (Performance fee payable will be calculated on the NAV on the day of 

exit) and b) Exit fees up to 3% will be charged. In case of withdrawal after 12 months but before 

completion of 24 months a) Fixed management fee payable up to 3% p.a. and Performance fee 

payable up to 25% of incremental gains beyond annualized hurdle rate not exceeding 12% on the 

basis of High Water Mark Principle will be charged (Performance fee payable will be calculated on 

the NAV on the day of exit) and b) Exit fees up to 2% will be charged. In case of withdrawal after 24 

months but before completion of 36 months a) Fixed management fee payable up to 3% p.a. and 

Performance fee payable up to 25% of incremental gains beyond annualized hurdle rate not 

exceeding 12% on the basis of High Water Mark Principle will be charged (Performance fee payable 

will be calculated on the NAV on the day of exit) and b) Exit fees up to 1% will be charged. When 

exiting, after completing a period of 36 months, the client will be charged Fixed Management fee 

upto 3% p.a. and Performance Fee up to 25% of incremental gains beyond annualized hurdle rate not 

exceeding 12% on the basis of High Water Mark Principle based on the NAV of the day of exit. 



25



OMEGA Plus: 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Plus Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 3% p.a. charged upto 0.75% at the end of every 


balance). 

Following charges shall be payable by client upon withdrawal from the Omega Plus Portfolio under 

Option 1: 








activated 




activated 















The Performance fee in this Omega Plus option will not exceed 25% of incremental gains beyond 


the investment. For existing clients, the performance fee will be computed on a High Watermark 



months (anniversary basis) and not financial year basis 


Option 2: 



26 


a) Performance fee up to 25% of incremental gains beyond










activated 



High Water Mark Principle will be charged (Performance 

fee payable will be calculated on the NAV on the day of 

exit) and 





activated 




charged (Performance fee payable will be 








Water Mark Principle based on the NAV of the day of exit of 

the Client from the Portfolio. 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Plus Portfolio (with profit sharing) will not 

exceed 3% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset Value 









Option 3: 






a) Fixed management fee payable up to 3% p.a and 


27








activated 

a) Fixed management fee payable up to 3% p.a. and 










activated 




















OMEGA Moderate: 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Moderate Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 3.00% p.a. charged upto 0.75% at the end of every 


balance). 

28

Following charges shall be payable by client upon withdrawal from the Omega Moderate Portfolio 









activated 




activated 









a) Fixed Management Fee upto 3.00% p.a. and 


Fixed management fee up to 3.00% p.a. till the day client 

exits the portfolio. 
















beyond annualized hurdle rate not exceeding 0% will 

be charged (Performance fee payable will be calculated 






activated 






29




activated 





exit) and 










FIXED MANAGEMENT FEE: The Fixed fee for the Omega Moderate Portfolio (with profit sharing) will 

























activated 







30





activated 











a) Fixed Management fee upto 3.00% p.a. and 




NAV of the day of exit from the portfolio. 





OMEGA Aggressive: 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Aggressive Portfolio (without profit sharing) 

charged by the Portfolio Manager will not exceed 3% p.a. charged upto 0.75% at the end of every 


balance). 

Following charges shall be payable by client upon withdrawal from the Omega Aggressive Portfolio 









activated 








31

ut before completion of 36 months 


activated 








PERFORMANCE FEE: The Performance fee in this Omega Aggressive option will not exceed 25% of 















activated 




activated 


















(Performance fee payable will be calculated on the NAV 

on the day of exit) and 






32


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Aggressive Portfolio (with profit sharing) will 

not exceed 3% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset 

















activated 




activated 




33 


























NAV of the day of exit from the portfolio.





OMEGA Systematic Equity: 


The Fixed fee for the Omega Systematic Strategy(without profit sharing) charged by the Portfolio 

Manager will not exceed 3% p.a. charged upto 0.75% at the end of every quarter on the daily average 


Following charges shall be payable by client upon withdrawal from the Omega Systematic Equity 

Portfolio under Option 1: 








activated 




activated 















PERFORMANCE FEE: The Performance fee in this Omega Systematic Strategy will not exceed 25% of 


Principle over the life of the investment. The performance fees will be charged on completion of 12 

months from date of account opening (anniversary basis) and not financial year basis. 



34














activated 









activated 





d) Exit fees up to 1% 










FIXED MANAGEMENT FEE: The Fixed fee for the Omega Systematic Strategy Portfolio (with profit 

sharing) will not exceed 3% p.a. which is upto 0.75% at the end of every quarter on the daily average 




life of the investment. The performance fees will be charged on completion of 12 months 






35 


a) Fixed management fee payable up to 3% p.a and



Performance fee payable up to 25% of incremental gains 


charged (Performance fee payable will be calculated on the 

NAV on the day of exit) and 





activated 




the basis of High Water Mark Principle will be charged 


on the day of exit)and 





activated 











a)Fixed Management fee upto 3% p.a. and 




exit. 

The Portfolio Manager shall charge audit fees, custodial / AMC charges and other charges/costs, 




OMEGA Systematic Multi Asset: 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Systematic Multi Asset Strategy(without 

profit sharing) charged by the Portfolio Manager will not exceed 3% p.a. charged upto 0.75% at the 

end of every quarter on the daily average Net Asset Value of the Portfolio (inclusive of all securities 

and cash/bank balance). 

Following charges shall be payable by client upon withdrawal from the Omega Systematic Multi Asset 


36








activated 




activated 














PERFORMANCE FEE: The Performance fee in this Omega Systematic Multi Asset Strategy will not 

exceed 25% of incremental gains beyond annualized hurdle rate not exceeding 0% on the basis of 

High Water Mark Principle over the life of the investment. The performance fees will be charged on 











activated 




activated 

















37







exit. 


FIXED MANAGEMENT FEE: The Fixed fee for the Omega Systematic Multi Asset Strategy (with profit 

sharing) will not exceed 3% p.a. which is upto 0.75% at the end of every quarter on the daily average 




life of the investment. The performance fees shall be charged on completion of 12 months 


















activated 











activated 



incremental gains beyond annualized hurdle rate 

not exceeding 12% on the basis of High Water 

Mark Principle will be charged (Performance fee 

payable will be calculated on the NAV on the day 

of exit) and 

38














7. Theta Portfolio 

The Theta Portfolio is designed for those investors who seek income and long-term capital 

appreciation from their asset allocation to debt. 


The investment objective of the Strategy is to generate income and long term capital appreciation 

through a 100% debt portfolio investing in debt mutual funds, bonds and debentures. 


Theta portfolio is recommended for investors seeking to hold a diversified debt portfolio with 

moderate risk appetite expecting a moderate return over a long term horizon. 


The amount of Portfolio invested in Debt will be 100% of the Portfolio. 

Securities 

Investments will be made in mutual funds, Exchange Traded Funds (ETF), listed and unlisted bonds 

and debentures whether listed or unlisted, rated or unrated. 

Investment in Mutual Funds and ETFs will be valued on the day end’s NAV. Investment in Non 

Convertible Debentures, Certificate of Deposits, bonds and other debt instruments will be valued at 

closing price, if listed, or as per valuation provided by the Issuer. 



The Client may withdraw whole or part of the funds or securities from the portfolio account by 


strategy and return the funds or securities of the strategy, as the case may be, to the client within 


39

The Portfolio Manager will provide periodical reports as required under the regulations at the 




The portfolio account will be audited by the Independent Chartered Accountant every year and copy 











FIXED MANAGEMENT FEE: The Fixed fee for the Theta Portfolio (without profit sharing) charged by 



Following charges shall be payable by client upon withdrawal from the Theta Portfolio under Option 

1: 






months but before completion of 

















Fixed management fee up to 3% p.a. till the day client exits the 

strategy. 


40



life of the investment. For existing clients, the performance fee shall be computed on a High 


year basis. Since August 1, 2012, for new clients, the performance fees is being charged on 



2: 


































Water Mark Principle based on the NAV of the day of exit. 


FIXED MANAGEMENT FEE: The Fixed fee for the Theta Portfolio (with profit sharing) will not exceed 

3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset Value of the 





Watermark Principle over the life of the Investment at the end of every financial year on financial year 

41

asis. Since August 1, 2012, for new clients, the performance fees is being charged on completion of 

12 months (anniversary basis) and not financial year basis. 


3: 



































period of 36 months of date 

from which client account is 

activated 




High Water Mark Principle based on the NAV of the day 

of exit. 

8.Alpha Plus Portfolio 

Introduction 

The Alpha Plus Portfolio is a diversified portfolio with investments in stocks across sectors, market 

capitalizations and investment themes. 

42


The investment objective of the strategy is to achieve growth and returns through broad based 

participation in equity markets with investments in companies which have sustainable business 

model, good corporate governance and high growth. 




Securities 

Investments will be made in stocks, mutual funds and Exchange Traded Funds (ETF). The Portfolio 














FIXED MANAGEMENT FEE: The Fixed fee for the Alpha Plus Portfolio (without profit sharing) charged 

by the Portfolio Manager will not exceed 3.00% p.a.The fixed fees for the Alpha Plus Portfolio 

charged by the Portfolio Manager will be charged at the end of every quarter on the daily average 


PERFORMANCE FEE: For existing clients, the performance fee will be computed on a High Watermark 

Principle over the life of the Investment at the end of every financial year on financial year basis 

.Since August 1, 2012, for new clients, the performance fees is being charged on completion of 12 

months (anniversary basis) and not financial year basis. 





43

The investor has the following fee options: 


FIXED MANAGEMENT FEE: charged upto 0.75% at the end of every quarter on the daily average Net 


Following charges shall be payable by client upon withdrawal from the Alpha Plus Portfolio under 

Option 1: 
























strategy. 









Option 2: 













44
























FIXED MANAGEMENT FEE: The Fixed fee for the Alpha Plus Portfolio (with profit sharing) will not 

exceed 3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset 









Option 3: 









45 










beyond annualized hurdle rate not exceeding 12% on the

asis of High Water Mark Principle will be charged 










activated 













of exit. 













9.Gamma Portfolio 


Gamma Portfolio aims to generate Capital appreciation in the medium term through investments in 

equities. It would aim to invest in perceived high growth companies with sustainable business 

models backed by apparent strong management capabilities. 

46




Securities 















FIXED MANAGEMENT FEE: The Fixed fees for the Gamma Portfolio charged by the Portfolio Manager 





Since August 1, 2012, for new clients, the performance fees is being charged on completion of 12 








FIXED MANAGEMENT FEE: The Fixed fee for the Gamma Portfolio (without profit sharing) charged by 



47

Following charges shall be payable by client upon withdrawal from the Gamma Portfolio under 

Option 1: 
























portfolio. 









Option 2: 




















48















Water Mark Principle based on the NAV of the day of exit from 

the Portfolio. 


FIXED MANAGEMENT FEE: The Fixed fee for the Gamma Portfolio (with profit sharing) will not 

exceed 3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset 




life of the investment.Since August 1, 2012, for new clients, the performance fees is being charged 

on completion of 12 months (anniversary basis) and not financial year basis. 


Option 3: 

























49













activated 





of exit. 













10.PSI Portfolio 

Introduction 

The PSI Portfolio is designed for those investors who seek long-term capital appreciation from their 

asset allocation to equities and other investment vehicles and attempt to outperform the market in 

the long run. The portfolio will invest in equity, equity related instruments and other alternative 

asset classes. 


The investment objective of the Strategy is to generate growth of capital and returns through short 

term investing. Investments will be made in stocks which look attractive on valuation and growth 

prospects. Additionally investments will be made in alternate asset classes based on attractiveness of 

the asset class. 

50


This Portfolio is recommended for investors seeking to hold a diversified equity portfolio with high 

risk appetite expecting a high return over medium term horizon. 


The Portfolio will seek to remain substantially invested in Equities or Equities related instruments. 

Part of the portfolio might be invested in Government Bonds, Exchange Traded Funds (ETF). The cash 

in the portfolio may be invested in Liquid Funds or Liquid Bees. The portfolio composition will vary 

from time to time. 

Securities 

Investments will be made through Stocks, Stock futures, Mutual Funds, Equity & non Equity ETFs, 

Gold ETFs, structures, NCDs, Government Bonds and Corporate bonds. The Portfolio will also use 

Stock options and Index Futures and Options – for hedging and rebalancing of the portfolio. 




that equity in BSE. 

Investment in “Futures and Options”, used for hedging, shall be valued at actual cash margins paid 

against F&O contracts, summed with Mark to Market profit / loss computed on the basis of closing 

price of such contracts. 




FIXED MANAGEMENT FEE: The Fixed fees for the Psi Portfolio charged by the Portfolio Manager will 

be charged at the end of every quarter on the daily average Net Asset Value of the Portfolio 




Since August 1, 2012, for new clients, the performance fees is being charged on completion of 12 







51


FIXED MANAGEMENT FEE: The Fixed fee for the Psi Portfolio (without profit sharing) charged by the 

Portfolio Manager will not exceed 3.00% p.a. charged upto 0.75% at the end of every quarter on the 

daily average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 

Following charges shall be payable by client upon withdrawal from the Psi Portfolio under Option 1: 
























portfolio 

























52





















FIXED MANAGEMENT FEE: The Fixed fee for the Psi Portfolio (with profit sharing) will not exceed 

3.00% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset Value of 

the Portfolio (inclusive of all securities and cash/bank balance). 





























53




















of exit. 













11.Aurous Portfolio 

Introduction 

Aurous Portfolio is designed for those investors who seek long-term capital appreciation from their 

asset allocation primarily to debt and gold and other investment vehicles as may be required 


The investment objective of the Strategy is to attempt preservation and growth of capital primarily 

through investment in Gold and debt instruments. Additionally investments will be made in other 

asset classes based on attractiveness of the asset class. 

54


Aurous portfolio is suitable for clients with a moderate risk appetite looking at capital appreciation 

over a long term horizon 


The Portfolio will seek to remain substantially invested in Debt and instruments offering exposure to 

Gold. Part of the portfolio might be invested in Government Bonds, Exchange Traded Funds (ETFs) or 

Equity. The cash in the portfolio may be invested in Liquid Funds or Liquid ETFs. The portfolio 

composition will vary from time to time. 

Securities 

Investments will be made in Stocks, Stock futures, Mutual Funds, Equity & non Equity ETFs , Gold 

ETFs, structured products, Non Convertible Debentures, Government Bonds and Corporate bonds. 

The Portfolio will also use Stock options and Index Futures and Options – as may be required from 

time to time. The exposure through futures and options will not exceed 100 percent of the portfolio 

value at all times. The portfolio will not invest in commodity futures. Derivative Instruments shall, 

however, not be used in case of NRI investors. 



that equity in BSE. 

Investment in “Futures and Options”, shall be valued at actual cash margins paid against F&O 

contracts, summed with Mark to Market profit / loss computed on the basis of closing price of such 

contracts. 

Investment in Mutual Funds and ETFs will be valued on the day end’s NAV. Investment in NCDs, 

bonds and other debt instruments will be valued at closing price, if listed or as per valuation provided 

by the issuer. 




The Fixed fees for Aurous Portfolio charged by the Portfolio Manager will be charged at the end of 


cash/bank balance). The performance fees will be computed on a High Watermark Principle over the 

life of the investment at the completion of 12 months (anniversary basis). The investor has the 



The Fixed fee for Aurous Portfolio (without profit sharing) charged by the Portfolio Manager will not 

exceed 3% p.a. charged upto 0.75% at the end of every quarter on the daily average Net Asset Value 




55






The Performance fee for Aurous in this option will not exceed 25% of incremental gains beyond 


the investment. The performance fees will be charged on completion of 12 months (anniversary 

basis). 















The Fixed fee for the Aurous Portfolio (with profit sharing) will not exceed 3% p.a. which is upto 


all securities and cash/bank balance). The Performance fee in this option will not exceed 25% of 



months (anniversary basis). 

However, in case of withdrawal before 12 months a) Fixed management fee payable up to 3% p.a 




completion of 24 months a) Fixed management fee payable up to 3% p.a. and Performance fee 




months but before completion of 36 months a) Fixed management fee payable up to 3% p.a. and 







56





12. Zeta Portfolio 

Introduction 

Zeta Portfolio is designed for those investors who seek long-term capital appreciation from their 

asset allocation to equities, debt, gold, stock futures and options and other asset classes which are 

available through either exchange traded products, Over the counter products or through mutual 

funds. 



through a portfolio of equities, debt, gold, stock futures and options and other asset classes which 

are available through either exchange traded products, Over the counter products or through mutual 

funds. The allocation to these assets will be made in accordance with the view of the portfolio 

manager on the specific asset class. 


The strategy is recommended for clients with a moderate risk profile looking at capital appreciation 

of their assets over a moderate investment horizon. 




The amount of Portfolio invested in Gold Exchange Traded Funds {ETFs} will be between 0% - 100% 

of the Portfolio. 

The amount of Portfolio invested in other asset classes of Exchange Traded Products or Mutual Funds 

will be between 0% - 100% of the Portfolio. 

Investment in Futures and Options will be to the extent of 100% of the portfolio value at all times. 


Securities 

Investments will be made through stocks, stock futures, mutual funds, Equity & non Equity ETFs, 

Gold ETFs, market linked debentures, Non Convertible Debentures (NCDs), Government Bonds and 

Corporate bonds and Over the counter instruments. The Portfolio will also use stock options and 

index futures and options – as may be required from time to time. The exposure through futures and 

options will not exceed 100 percent of the portfolio value at all times. The portfolio will not invest in 

commodity futures. 

57



BSE. 

Investment in “Futures and Options” shall be valued at actual cash margins paid against F&O 

contracts, summed with Mark to Market profit / loss computed on the basis of closing price of such 

contracts. 

Investment in mutual funds and ETFs will be valued on the day end’s NAV. Investment in NCDs, 

bonds and other debt instruments will be valued at closing price, if listed or as per valuation provided 

by the issuer. 




FIXED MANAGEMENT FEE: The Fixed fees for Zeta Portfolio charged by the Portfolio Manager will be 

charged at the end of every quarter on the daily average Net Asset Value of the Portfolio (inclusive of 


PERFORMANCE FEE: The performance fees will be computed on a High Watermark Principle over the 

life of the investment at the completion of 12 months (anniversary basis). 

The Portfolio Manager shall charge audit fees, custodial/AMC charges and other charges/costs, 






FIXED MANAGEMENT FEE: The Fixed fee for Zeta Portfolio (without profit sharing) charged by the 

Portfolio Manager will not exceed 3% p.a. charged upto 0.75% at the end of every quarter on the 

daily average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank balance). 

Following charges shall be payable by client upon withdrawal from the Zeta Portfolio under Option 1: 
















58









strategy 


PERFORMANCE FEE: The Performance fee for Zeta portfolio in this option will not exceed 25% of 



months (anniversary basis). 






































59

FIXED MANAGEMENT FEE: The Fixed fee for the Zeta Portfolio (with profit sharing) will not exceed 

3% p.a. which is upto 0.75% at the end of every quarter on the daily average Net Asset Value of the 




life of the investment. The performance fees will be charged on completion of 12 months 

(anniversary basis). 






































activated 





of exit. 

60

B. Non - Discretionary Portfolio Management Services 

The following are illustrative, but not exhaustive, investment options or products available for client 

availing Non-Discretionary Portfolio Management Services. 

1. Equity 

Portfolio: 

2. Non 

Convertible 

Debentures: 

3. Non 

Convertible 

Debentures as 

part of 

Structured 

Products 

4. Structured 

product 

Equity Portfolio (Non discretionary) are designed for those investors who seek 

long-term capital appreciation from their asset allocation to equities. The 

portfolio manager will invest in stocks across sectors, market capitalization 

categories and investment themes, in consultation with and as per directions or 

consent of the client. 

Minimum investment amount: Rs. 25 lakhs 

The Non Convertible Debentures are debentures which do not get converted into 

equity and normally attract a fixed rate of return. The Non-convertible 

Debentures may be listed or unlisted. 

Investments will be made in the Non Convertible Debentures in consultation with 

and as per directions or the consent of the client. 


Non convertible Debentures are normally issued with a fixed rate of Interest. 

The Non Convertible Debentures as part of Structured Products are designed as 

equity linked structures, debentures, derivative instruments, swaps, swaptions, a 

basket of securities, options, indices, commodities linked structures, debt 

issuances and/or foreign currencies, Secured Premium Notes, money market 

instruments, etc. for those investors who want returns linked to an underlying 

asset with a predefined level of capital protection. 

These products may be principal or non principal protected. 

Investments may be made both in rated and unrated debentures to cater to 

specific Client requirement. 

Investments in such products will be made in consultation with and as per 



The Structured products are designed for those investors who want returns 

linked to price movement of any Equity index, basket of stocks, commodities, 

precious metals, etc., with a predefined level of capital protection. 

Structured Products may be principal or non principal protected or may not have 

any protection at all. Investments will be made in the structured products in 

consultation with and as per directions or the consent of the client. 


The list of products provided here is not exhaustive and the Portfolio Manager may devise and 

recommend other products as per specific needs of the client. 


The Portfolio will be invested in Equities, Mutual Funds, Exchange Traded Funds, Non Convertible 

Debentures, Bonds, Debt Instruments, Derivatives, Money market Instruments and Structured 

61

products in consultations with and as per directions or consent of the client. The cash in the portfolio 

will be invested in Liquid Funds or Liquid Bees. 

Valuation of Assets 



that equity in BSE. Investment in NCDs, bonds and other debt Instruments will be valued at closing 

price, if listed, or as per valuation provided by the issuer. Investment in “Futures and Options”, used 

for hedging, shall be valued at actual cash margins paid against F&O contracts, summed with Mark to 

Market profit / loss computed on the basis of closing price of such contracts. 

Structured Products will be valued at the valuation provided by the issuer of the structured products 

from time to time. 


In case of Non-discretionary Portfolio Management Services, the Fees payable by the Client would 

not exceed 3% of the invested amount 

The Client will also have to bear brokerage not exceeding 2.5% and other incidental 

charges/fees/duties and taxes including Securities Transaction Tax at actual. 

The Portfolio Manager will charge audit fees, custodial/ AMC charges and other charges/costs, 






reasonable time. The Client will not withdraw funds given earlier than 12 months and in the event of 

a withdrawal earlier than 12 months; the complete annual fund management fee as per rates agreed 

with the client will be levied on the funds or securities withdrawn, on a full year basis. 

The investments are normally for a tenor which varies from 12 Months to 60 Months 







62

Non - Discretionary Portfolio Management Services 

Omega Portfolio 

The Omega Portfolio is designed for those investors who seek long-term capital appreciation from 

their asset allocation to equities, debt, gold and other asset classes which are available through 

either exchange traded products or through mutual funds. 



through a portfolio of debt, equity, gold ETFs and other asset classes which are available through 

either exchange traded products or through mutual funds and the allocation amongst the asset 

classes is done on the basis of the risk profile of the investor in consultation with and as per 



Assets will be allocated amongst following asset classes in consultation with and as per directions or 





The amount of Portfolio invested in other asset classes which are available through either exchange 

traded products or through mutual funds will be between 0% - 100% of the Portfolio. 

Investment can be made in other asset classes as per choice, consent or directions of the client. 

Securities 


Debentures, and Bonds. The Portfolio will also use derivative instruments – Futures and Options – for 

hedging and rebalancing of the portfolio and other investment options as per choice, consent or 

direction of the client. Derivative Instruments shall, however, not be used in case of NRI investors. 



that equity at BSE. Investment in Mutual Funds and ETFs will be valued on the day end’s NAV. NAV 

Investment in NCDs, bonds and other debt Instruments will be valued at closing price, if listed, or as 

per valuation provided by the issuer. Investment in “Futures and Options”, used for hedging, shall be 

valued at actual cash margins paid against F&O contracts, summed with Mark to Market profit / loss 

computed on the basis of closing price of such contracts. Derivative Instruments shall, however, not 

be used in case of NRI investors. 


Minimum investment amount is Rs. 25 lakhs 




reasonable time. For existing clients, the performance fee will be computed on a High Watermark 


63







. 






The Fixed fee for the Omega Portfolio (without profit sharing) charged by the Portfolio Manager will 

not exceed 3.00% p.a. charged upto 0.75% at the end of every quarter on the daily average Net Asset 











investment. For existing clients, the performance fee will be computed on a High Watermark 

















64


The Fixed fee for the Omega Portfolio (with profit sharing) will not exceed 3.00% p.a. which is upto 


all securities and cash/bank balance). The Performance fee in this option will not exceed 25% of 




financial year basis. From 1 st August, 2012, for new clients the performance fees will be charged on 


However, in case of withdrawal before 12 months a) Fixed management fee payable up to 3.00% p.a 




completion of 24 months a) Fixed management fee payable up to 3.00% p.a. and Performance fee 




months but before completion of 36 months a) Fixed management fee payable up to 3.00% p.a. and 











Optima Portfolio 

The Optima Portfolio is designed for those investors who seek capital appreciation from their asset 

allocation to Equities, debt and gold. 


The investment objective of the Strategy is to generate capital appreciation of wealth through a 

portfolio of Debt, Equity and Gold securities which is rebalanced regularly and the allocation 

between Debt, Equity and Gold ETFs is done on the basis of the risk profile of the investor in 

consultation with and as per directions or consent of the client. 







Investment can be made in other asset classes as per choice, consent or directions of the client. 

65

Securities 


Debentures, and Bonds and other investment options as per choice, consent or direction of the 

client. 


in any stocks listed on BSE only, the same will be valued based on the closing price of that equity at 

BSE. Investment in Mutual Funds and ETFs will be valued on the day end’s NAV Investment in NCDs, 

bonds and other debt Instruments will be valued at closing price, if listed, or as per valuation 

provided by the issuer. 




The Fixed fees for the non discretionary Portfolio charged by the Portfolio Manager will be charged 

at the end of every quarter on the daily average Net Asset Value of the Portfolio (inclusive of all 

securities and cash/bank balance). For existing clients, the performance fee will be computed on a 

High Watermark Principle over the life of the Investment at the end of every financial year on 

financial year basis. From 1 st August, 2012, for new clients, the performance fees will be charged on 

completion of 12 months (anniversary basis) and not financial year basis. The investor has the 


Option 1: Fixed Management Fee up to 4.00% p.a. 

The Fixed fee (without profit sharing) charged by the Portfolio Manager will not exceed 4 % p.a. 

charged @ 1% at the end of every quarter on the daily average Net Asset Value of the Portfolio 









The Performance fee in this option is up to 25% of incremental gains beyond annualized hurdle rate 

of 0% on the basis of High Water Mark Principle over the life of the investment. For existing clients, 

the performance fee will be computed on a High Watermark Principle over the life of the Investment 

at the end of every financial year on financial year basis. From 1 st August, 2012, for new clients the 

performance fees will be charged on completion of 12 months (anniversary basis) and not financial 

year basis. 








66








The Fixed fee (with profit sharing) will not exceed 4% p.a. which is @ 1% at the end of every quarter 

on the daily average Net Asset Value of the Portfolio (inclusive of all securities and cash/bank 

balance). 

The Performance fee will not exceed 25% of incremental gains beyond annualized hurdle rate not 

exceeding 12% on the basis of High Water Mark Principle over the life of the investment. For existing 

clients, the performance fee will be computed on a High Watermark Principle over the life of the 

Investment at the end of every financial year on financial year basis. From 1 st August, 2012, for new 

clients the performance fees will be charged on completion of 12 months (anniversary basis) and not 

financial year basis. 

However, in case of withdrawal before 12 months a) Fixed management fee payable up to 4.00% p.a 




completion of 24 months a) Fixed management fee payable up to 4.00% p.a. and Performance fee 




months but before completion of 36 months a) Fixed management fee payable up to 4.00% p.a. and 








Minimum investment amount is Rs. 25 Lakhs 



The Client will also have to bear brokerage charges not exceeding 2.50% of the transaction value and 

other incidental charges/fees/duties and taxes including Securities Transaction Tax at actual. 




reasonable time. In the event of a withdrawal earlier than 12 months; the complete fixed 

management fee or a combination of performance fee and fixed management whichever is higher 

will be charged, as applicable, on the funds or securities withdrawn, on a full year basis. 

67







Alpha Portfolio 

Introduction 

This portfolio is designed for those investors who seek aggressive capital appreciation from their 

equity asset allocation. The portfolio will invest in stocks across sectors, market capitalization 

categories and investment themes. 


The investment objective is to provide returns and capital appreciation through broad based 


model, good corporate governance and high growth. 





Investment can be made in other asset classes like debt, Gold ETF as per choice, consent or 

directions of the client. 

Securities 

Investments will be made in Stocks and other investment options like Mutual Funds, Exchange 

Traded Funds (ETF) as per choice, consent or direction of the client. 



BSE. Investment in Mutual Funds and ETFs will be valued on the day end’s NAV Investment. 




The Fixed fees for the Alpha advisory charged by the Portfolio Manager will be charged at the end of 


cash/bank balance).For existing clients, the performance fee will be computed on a High Watermark 



months (anniversary basis) and not financial year basis. . The investor has the following fee options: 


68




Following charges shall be payable by client upon withdrawal from the Alpha Portfolio under Option 

1: 
























strategy. 







year basis. 


2: 

















Water Mark Principle will be charged (Performance fee 


69




















balance). 








3: 








activated 




activated 

70 





will be charged (Performance fee payable will be 












gains beyond annualized hurdle rate not exceeding







c) Exit fees up to 1% will be charged 





of exit. 


Minimum investment amount is Rs. 25 lakhs. 




other incidental charges/fees/duties such as audit fees , custodial/ AMC charges and other 

charges/costs, attributable to the Portfolio Management Services and taxes including Securities 

Transaction Tax at actual. 









Equity Advisory Portfolio 

Advisory Services 

Introduction 

This portfolio is designed for those investors who seek aggressive capital appreciation from their 

equity asset allocation. The portfolio will invest in stocks across sectors, market capitalization 

categories and investment themes. 


The investment objective is to provide returns and capital appreciation through broad based 


model and high growth. 


71




Investment can be made in other asset classes like debt, Gold ETF as per choice, consent or 

directions of the client. 

Securities 

Investments will be made in Stocks and other investment options like Mutual Funds, Exchange 

Traded Funds (ETF) as per choice, consent or direction of the client. 



BSE. Investment in Mutual Funds and ETFs will be valued on the day end’s NAV Investment. 


PLACEMENT FEE: A placement fee not exceeding 3% on the investment will be charged over and 


FIXED MANAGEMENT FEE: The Fixed fees for the Alpha advisory charged by the Portfolio Manager 


(inclusive of all securities and cash/bank balance). The performance fee will be computed on a High 


year basis. 




other incidental charges/fees/duties such as audit fees , custodial/ AMC charges and other 

charges/costs, attributable to the Portfolio Management Services and taxes including Securities 

Transaction Tax at actual 



















72












strategy. 







year basis. 























activated 



Water Mark Principle will be charged (Performance fee 







exit) and 





the strategy. 

73




balance). 
















12% will be charged (Performance fee payable will 

be calculated on the NAV on the day of exit) and 

c) Exit fees up to 3% . 




activated 




12% on the basis of High Water Mark Principle will 

be charged (Performance fee payable will be 


c) Exit fees up to 2% . 




activated 




the basis of High Water Mark Principle will be charged 



c) Exit fees up to 1% will be charged. 







on the basis of High Water Mark Principle based on 

74

the NAV of the day of exit. 


Minimum investment amount is Rs.25 lakhs. 











The term “Strategy” or “Strategies” referred in this document is not prima facie the strategy(s) 

devised to organize investment portfolios, rather these are various investment categories/ 

frameworks on the basis of which investment portfolio of a subscriber can be tailored. Reference to 

the term “Strategy” or “Strategies” however helps in defining and communicating fee structure to a 

subscriber in a simple and transparent manner. 

GLOSSARY OF TERMS USED IN THE RISK DISCLOSURE DOCUMENT AND ANNEXURE A 

Discretionary portfolio: A portfolio where the funds of each client are managed individually 

and independently by the fund manager in accordance with the needs of the client. 

Non discretionary Portfolio: A portfolio where the funds are managed by the fund manager in 

accordance with the directions of the client. 

Hurdle rate: The rate over which profit sharing / performance related fees are usually charged by 

portfolio managers. This is not a fixed number and would be specified in the agreement signed with 

the client. 

High Water Mark Principle: As defined by SEBI, High Water Mark shall be the highest value that the 

portfolio/account has reached. Value of the portfolio for computation of high watermark shall be 

taken to be the value on the date when performance fees are charged. The portfolio manager shall 

charge performance based fee only on increase in portfolio value in excess of the previously achieved 

high water mark 

Asset allocation: Asset allocation is an investment strategy that attempts to balance risk versus 

75

eward by adjusting the percentage of each asset in an investment portfolio according to the 

investors risk tolerance, goals and investment time frame. 

Asset Classes: A group of securities that exhibit similar characteristics, behave similarly in the 

marketplace, and are subject to the same laws and regulations. Asset classes include but are not 

limited to Equities, fixed-income and cash equivalents. 

Non convertible debentures: A debenture is a document that either creates a debt or acknowledges 

it, and it is a debt without collateral (hence, unsecured debt). Non-convertible debentures are 

regular debentures which cannot be converted into equity shares of the liable company. 

Investment vehicles: An investment vehicle is a product used by investors with the intention of 

having positive returns. Investment vehicles can be low-risk, such as certificates of deposit (CDs) or 

bonds, or can carry a greater degree of risk such as with stocks, options and futures. 

Alternate asset classes: Alternate asset class is a newer type of asset that was not traditionally 

considered to be a part of an investment portfolio. These include but would not be limited to 

Derivative instruments, Real Estate, Commodities (including Gold) etc. 

Structured Products: A market linked investment, is generally a pre-packaged investment strategy 

based on derivatives, such as a single security, a basket of securities, options, commodities, debt 

issuance etc. 

Over the counter products: OTC or off-exchange products are those where trading is done directly 

between two parties, without any supervision of an exchange. These are used primarily where 

customized products are required. 

* * * 

76

Disclosure Document - Karvy

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