SBI FUNDS MANAGEMENT LIMITED

SBI FUNDS MANAGEMENT LIMITED Form ADV Part 2A - Disclosure Brochure JUNE 27, 2025 SBI Funds Management Limited 9th Floor, Crescenzo, C-38&39, G Block, Bandra-Kurla Complex, Bandra (East), Mumbai – 400 051 Maharashtra, India This Brochure provides information about the qualifications and business practices of SBI FUNDS MANAGEMENT LIMITED. If you have any questions about the contents of this Brochure, please contact us at 91 22 6179 3000. The information in this Brochure has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority. Additional information about SBI FUNDS MANAGEMENT LIMITED also is available on the SEC’s website at www.adviserinfo.sec.gov.  Item 2 – Material Changes There were no material changes to this Brochure dated June 27, 2025, from the last annual update dated June 28, 2024. However, there were additions / changes done in the below items providing elaborations, enhancements and clarifications throughout: Item 4 – Advisory Business Item 7 – Types of Clients – reference rate Item 9 – Disciplinary information 2  Item 3 - Table of Contents Item 1 – Cover Page................................................................................................................................................ 1 Item 2 – Material Changes ...................................................................................................................................... 2 Item 3 – Table of Contents ...................................................................................................................................... 3 Item 4 – Advisory Business ..................................................................................................................................... 4 Item 5 – Fees and Compensation ............................................................................................................................ 5 Item 6 – Performance-Based Fees and Side-By-Side Management .......................................................................... 6 Item 7 – Types of Clients ......................................................................................................................................... 6 Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss ..................................................................... 6 Item 9 – Disciplinary Information .......................................................................................................................... 11 Item 10 – Other Financial Industry Activities and Affiliations ................................................................................. 12 Item 11 – Code of Ethics, Participation or Interest in Client Transactions and Personal Trading ............................. 12 Item 12 – Brokerage Practices .............................................................................................................................. 12 Item 13 – Review of Accounts .............................................................................................................................. 13 Item 14 – Client Referrals and Other Compensation .............................................................................................. 13 Item 15 – Custody ................................................................................................................................................ 13 Item 16 – Investment Discretion ........................................................................................................................... 14 Item 17 – Voting Client Securities ......................................................................................................................... 14 Item 18 – Stewardship Code ................................................................................................................................. 14 Item 19 – Financial Information ............................................................................................................................ 15 3  Item 4 – Advisory Business Advisory Services and Fees SBI Funds Management Limited (SBIFML or Company) (earlier known as SBI Funds Management Private Limited) was incorporated as a private limited company under the erstwhile Indian Companies Act, 1956 on February 7, 1992. The status of the Company was converted from ‘private limited company’ to ‘public limited company’ on December 16, 2021 in terms of the provisions of the Indian Companies Act, 2013. Consequently, the name of the Company has been changed from ‘SBI Funds Management Private Limited’ to ‘SBI Funds Management Limited’. SBIFML is having its Registered Office at 9th Floor, Crescenzo, C-38 & 39, G Block, Bandra-Kurla Complex, Bandra (East), Mumbai – 400051, Maharashtra, India. SBIFML is a joint venture between State Bank of India (SBI), one of the largest public sector banks in India and AMUNDI Asset Management (erstwhile Amundi S.A.), a leading European asset management company. SBI currently holds 61.98% stake in SBIFML and the 36.40% stake is held by AMUNDI Asset Management through a wholly owned subsidiary, Amundi India Holding. SBIFML is as an Asset Management Company of SBI Mutual Fund as well as an Investment Manager to the Alternative Investment Funds (Category II, III AIF and Corporate Debt Market Development Fund) set up in India and registered with Securities and Exchange Board of India (SEBI), the Indian securities regulator. In addition to the investment management activity, SBIFML is undertaking portfolio management services (Registered as Portfolio Manager with SEBI), management and advisory services to off-shore funds & Category I & II Foreign Portfolio Investors (FPIs). We are also registered as an Investment Adviser with Securities Exchange Commission (SEC) in USA. SBIFML had set up a branch in the International Finance Services Centre (IFSC) to carry out fund management and Portfolio Management Services in IFSC. IFSC is set-up in the Gujarat International Finance Tec-City (GIFT City), a special economic zone (SEZ) located in the Indian state of Gujarat. IFSC is regulated by the International Financial Services Centres Authority (IFSCA), established by the Government of India. Subsequently, SBIFML has incorporated a wholly owned subsidiary company in IFSC, viz. SBI Funds International (IFSC) Limited on February 07, 2024. SBI Funds International (IFSC) Limited is registered with the IFSCA as a Registered Fund Management Entity (Retail) to carry out fund management and Portfolio Management Services in IFSC. SBI Funds International (IFSC) Ltd. has become operational with effect from August 12, 2024, and is presently acting as Fund Management Entity in IFSC - Gift city. The existing business of SBI Funds Management Limited (IFSC Branch) has been transferred to SBI Funds International (IFSC) Limited with effect from August 12, 2024. SBIFML provides investment management and advisory services to registered investment companies, high-net- worth individuals, private investors and institutional investors, with a focus on Indian securities. Portfolios offered in SBIFML separately managed accounts may be suitable for a wide variety of investors, but particularly for more conservative investors with long-term time horizons. Investors who may find the SBIFML investment approach appropriate for their portfolios include:  Investors with long-term time horizons seeking growth of capital or a high level of current income.  Investors seeking to invest in fundamentally sound, well-managed companies that have long-term potential investments gains SBIFML offers a discretionary strategy where the potential investor is given a brief about the portfolio strategy before investing. In retail mandates which we offer, the strategies are not tailored to specifically meet a client’s individual financial needs. However, in institutional mandates we may tailor the strategies offered to suit client’s requirements. 4  The prospective client may choose to impose restrictions on investing in certain securities or types of securities. For example, stocks which derive a predominant portion of their revenue from Tobacco business might not be in the investible universe. Also, discretionary provident fund mandates impose severe restrictions on investment universe in terms of minimum credit rating, etc. and restricts asset allocation choices due to regulatory requirements. As of March 31, 2025, SBIFML managed approximately $168.11 billion in assets on a discretionary basis and approximately $6.82 billion in assets on a non-discretionary basis. Item 5 – Fees and Compensation SBIFML offers investment management and advisory services to clients who wish to invest in SBIFML's Mutual Fund, Offshore Fund and Portfolio Management & Investment Advisory businesses. SBIFML may receive advisory fees and/or management fees. SBIFML may further be reimbursed for certain operating and administrative expenses. All services will be provided pursuant to written agreements, which permit either the client or SBIFML to terminate the relationship at any time upon receipt of written notice by the other party. There is no standard fee schedule for institutional PMS. Fees are negotiated with clients individually. We charge fees as a percentage of assets or a fixed fee as well. Fees also include profit share above a certain threshold in a few mandates. Fees are generally paid quarterly in arrears and computed based on the value of the daily/weekly average assets under management at the end of each calendar quarter. Any significant contribution or withdrawal will be prorated based on the date the money was received. SBIFML may deduct fees from client’s assets or may bill clients for fees incurred. The client may choose either method. SBIFML will provide copies of the invoices to its clients. SBIFML reserves the right to negotiate fees when suitable. Some clients pay more or less than others depending on certain factors, including but not limited to, the type and size of the account, the historical or anticipated transaction activity, the range of additional services provided to the client or the amount of client relationship assets under management. SBIFML may enter into an agreement with a Broker-Dealer or third-party Registered Investment Advisor in which SBIFML pays a set percentage of the client’s management fee to the referring Broker-Dealer or third-party Registered Investment Advisor. Fees charged to the client may be unique for clients which would have come directly or through a broker-dealer. In addition to our fees, each of the Funds and Private Account clients also separately incurs and pays certain expenses related to the management and operation of the Fund or Private Account, as applicable, as well as the purchase, sale, or transmittal of the client’s assets that we manage. These expenses include, among other things:  brokerage commissions and other investment transaction costs;        custodial and sub-custodial fees; accounting, auditing, and other professional fees and expenses; legal fees (including fees charged to us for the benefit of the client); tax preparation fees; government fees and taxes; filing fees; costs of reporting; 5   in the case of the Funds; costs of Fund governance activities (including but not limited to expenses such as Board meeting-related expenses and other expenses for obtaining director and shareholder consents); and fees paid to the Fund’s administrator and the registrar Please refer to “Item 12 - Brokerage Practices” below for more information about soft dollars, brokerage commissions and other transaction expenses. Item 6 – Performance-Based Fees and Side-by-Side Management SBIFML charge performance-based fees as per the terms agreed in the fee schedule of the agreement. The term “performance-based fees” refers to fees based on a share of capital gains on, or capital appreciation of, a client's assets over and above hurdle rate defined in the agreement. SBIFML does not engage in side-by-side management. Item 7 – Types of Clients SBIFML provides investment management and advisory services to registered investment companies, high-net- worth individuals, private investors and institutional investors, with a focus on Indian securities. Portfolios offered in SBIFML separately managed accounts may be suitable for a wide variety of investors, but particularly for more conservative investors with long-term time horizons. Investors who may find the SBIFML investment approach appropriate for their portfolios include:  Investors with long-term time horizons seeking growth of capital or a high level of current income.  Investors seeking to invest in fundamentally sound, well-managed companies that have long-term potential investments gains. The minimum account size is INR 50,00,000 (current USD equivalent = ~ $58,439) * for all PMS and investment advisory portfolios. SBIFML will not accept portfolios for an investor whose investment objectives are inconsistent with the SBIFML's philosophy and disciplines. SBIFML may enter into agreements with parties that have different minimum account sizes, and different account minimums and fees for existing clients. (* Reference Rate: 1 USD = 85.5594 INR, as on June 27, 2025. Source: www.rbi.org.in) Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss METHODS OF ANALYSIS AND PORTFOLIO CONSTRUCTION LISTED EQUITY UNIVERSE ~4000 - 5000 STOCKS QUANTITATIVE SCREENING STOCKS WITH MARKETCAP ABOVE MINIMUM THRESHOLD AND THAT MEET BASIC FUNDAMENTAL PERFORMANCE STANDARDS. THRESHOLDS CHANGES WITH ASSET UNDER MANAGEMENT. FUNDAMENTAL ANALYSIS 1. ANALYSTS STUDY FINANCIAL STATEMENTS, MEET INDUSTRY PARTICIPANTS, COMPANY MANAGEMENT, CONDUCT VALUATION TO FORM OPINIONS ON STOCKS SPECIALISES IN 2-3 2. EACH ANALYST INDUSTRIES 6  CAPITALINE, 3. DATA FROM SUPPORT BLOOMBERG AND FACTSET INVESTMENT UNIVERSE (450-500 STOCKS) 1. ACTIVE COVERAGE ON ABOUT ~450 STOCKS. SECTOR RELATIVE RECOMMENDATION AND TARGET PRICE FOR STOCKS IN ACTIVE COVERAGE 2. QUALITATIVE INCLUDING ANALYSIS INDUSTRY STRUCTURE, BUSINESS MODEL, MANAGEMENT QUALITY, MARKET POSITION AND OPERATING LEVERS (GROWTH AND PROFITS), FORENSIC & ESG 3. FUND MANAGERS INVEST BASED ON PORTFOLIO PHILOSOPHY, RISK TEMPLATES AND SEBI REGULATIONS PORTFOLIO THAT NAVIGATE THE 1. CONVICTIONS MANDATE AND RESEARCH 2. ANALYST RECOMMENDATIONS 3. PORTFOLIO MANDATE AND RISK METRICS 4. MONITOR RISK BY USING MSCI BARRA RISK TOOLS OTHER TYPES OF INVESTMENT SBIFML may also purchase, recommend and provide advice on investment in fixed rate instruments, foreign securities (particularly Indian securities), money market and other financial instruments, derivative and hybrid instruments and any other interest in any of the foregoing. The mandate is managed based on the investment policy as communicated by the client. RISKS OF METHODS OF ANALYSIS Our judgment about the attractiveness, value and potential appreciation of a particular asset class or individual security may be incorrect, and there is no guarantee that the securities we select will perform as anticipated. The value of an individual security can be more volatile than the market as a whole, or our approach may fail to produce the intended results. Our assessment of an investment may be wrong or, even if that estimate is correct, it may take a long time before investors realize a resulting gain. As a result, there is a risk of loss of the assets we manage that is out of our control. We seek to reduce your risk through diversification. Although we will do our best in managing Client assets, we cannot guarantee any level of performance or that Clients will not experience a loss in their assets. Additionally, in performing our analysis, we may use commercially available information services and financial publications, research materials prepared by various broker-dealers and other research developed by other third- party providers. Our methods rely on the assumption that the companies whose securities we purchase and sell, the rating agencies that review these securities, and other publicly available sources of information about these securities, are providing accurate and unbiased data. While we are alert to indications that data may be incorrect, there is always a risk that our analysis may be compromised by inaccurate or misleading information. 7  INVESTMENT RISKS Investing in securities involves risk of loss of capital that clients should be prepared to bear. The material risks associated with the investment avenues discussed in this brochure are discussed below. Risk of Investing in Indian Securities: Emerging markets like India carry higher risk overall compared to developed markets. As such investors should be prepared for relatively higher volatility. Market Risk: in the client’s investment portfolio, adverse national and Market risk refers to the risk related to investments in securities in general and the daily fluctuations in the securities markets. A client’s investment is affected by many factors, including fluctuation in interest rates, the quality of the instruments international economic conditions/developments and general market and economic conditions. Equity Risk: The value of equity securities can fluctuate — at times dramatically. The prices of equity securities are affected by various factors, including market conditions, political and other events, and developments affecting the particular issuer or its industry or geographic sector. Management Risk: The risk that SBIFML’s judgments about the attractiveness, value and potential appreciation of a particular asset class or individual security, investment manager or private equity investment may be incorrect. There is no guarantee that individual companies will perform as anticipated. Small Cap and Mid Cap Company Risk: Investments in small and mid capitalization companies involve greater risks than investments in larger, more established companies. These companies may not have the size, resources or other assets of large capitalization companies, and may experience higher growth and higher failure rates than do larger companies. Because they may have limited product lines and financial resources, small and mid capitalization companies also may be more vulnerable to economic, market and industry changes. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Foreign Investment Risk: Foreign investing involves risks not typically associated with U.S. investments. These risks include, among others, adverse fluctuations in foreign currency values, as well as adverse political, social and economic developments affecting a foreign country. In addition, foreign investing involves less publicly available information, and more volatile or less liquid securities markets. Investments in foreign countries could be affected by factors not present in the U.S., such as restrictions on receiving the investment proceeds from a foreign country, foreign tax laws, and potential difficulties in enforcing contractual obligations. Foreign accounting may be less transparent than U.S. accounting practices and foreign regulation may be inadequate or irregular. Sovereign Debt Risk: Sovereign debt securities are issued or guaranteed by foreign governmental entities. These investments are subject to the risk that a governmental entity may delay or refuse to pay interest or repay principal on its sovereign debt, due, for example, to cash flow problems, insufficient foreign currency reserves, political considerations, the relative 8  size of the governmental entity’s debt position in relation to the economy or the failure to put in place economic reforms required by the International Monetary Fund or other multilateral agencies. If a governmental entity defaults, it may ask for more time in which to pay or for further loans. There is no legal process for collecting sovereign debts that a government does not pay nor are there bankruptcy proceedings through which all or part of the sovereign debt that a governmental entity has not repaid may be collected. Emerging Markets Risk: The securities markets in emerging market countries are less developed and less liquid and may be subject to greater price volatility. These countries may have relatively unstable governments and deficiencies in regulatory oversight, market infrastructure, shareholder protections and company laws that could expose investors to risks beyond those generally encountered in developed countries. In addition, profound social changes and business practices that depart from norms in developed economies have hindered the orderly growth of emerging economies and their markets in the past and have caused instability. Countries in emerging markets are also more likely to experience high levels of inflation, deflation or currency devaluation, which could hurt their economies and securities markets. For these and other reasons, investments in emerging markets are often considered speculative. Pooled Investment Risk: Clients invested in hedge funds and other pooled investment funds will indirectly bear fees and expenses charged by the underlying investment funds. Clients also may incur brokerage costs when purchasing exchange traded funds and closed-end funds. Interest Rate Risk: Fixed income securities increase and decrease in value based on changes in interest rates. If interest rates increase, the value of fixed income securities will decline. Conversely, if interest rates decline, the value of fixed income securities generally increase. Securities with longer maturities tend to produce higher yields but are more sensitive to changes in interest rates and are subject to greater fluctuations in value. Credit Risk: The issuer of a fixed income security may not be able to make interest and principal payments when due. Generally, the lower the credit rating of a security, the greater the risk that the issuer will default on its obligation. This could result in a loss to the investor. High Yield Securities Risk: High yield securities provide greater income and opportunity for gain but entail greater risk of loss of principal. High yield securities are predominantly speculative with respect to the issuer’s capacity to pay interest and repay principal in accordance with the terms of the obligation. These securities may be issued by companies which are highly leveraged, less creditworthy or financially distressed. Although these securities generally provide a higher yield than higher-rated debt securities, the high degree of risk involved in these securities can result in substantial or total losses. The market for high yield securities is generally less active than the market for higher quality securities and the market price of these securities can change suddenly and unexpectedly. Government Securities Risk: While Government Securities generally carry relatively minimal credit risk since they are issued by the Government, they do carry price risk depending upon the general level of interest rates prevailing from time to time. Generally, when interest rates rise, prices of fixed income securities fall and when interest rates decline, the prices of fixed income securities increase. The extent of fall or rise in the prices is a function of the coupon rate, days to maturity and the increase or decrease in the level of interest rates. The price-risk is not unique to Government of India 9  Securities. It exists for all fixed income securities. Therefore, their prices tend to be influenced more by movement in interest rates in the financial system than by changes in the government's credit rating. By contrast, in the case of corporate or institutional fixed income Securities, such as bonds or debentures, prices are influenced by their respective credit standing as well as the general level of interest rates. Even though the Government Securities market is more liquid compared to other debt instruments, on certain occasions, there could be difficulties in transacting in the market due to extreme volatility leading to constriction in market volumes. Counterparty Risk: Similar to credit risk, counterparty risk refers to the risk that a party to a transaction will default on its obligations, resulting in missed or delayed payments. Prepayment and Call Risk: The issuer of mortgage-backed and asset-backed securities and other callable securities may repay principal in advance, especially when interest rates fall. When mortgages and other obligations are prepaid, a third-party investment manager may have to reinvest in securities with lower yields. Some asset-backed securities also may be insufficiently collateralized. Derivatives Risk: Derivatives may be more sensitive to changes in economic or market conditions than other types of investments. The successful use of futures and options depends on the availability of a liquid secondary market to enable the position to be closed on a timely basis. There can be no assurance that such a market will exist at any particular time. Structured Instrument Risk: Structured instruments may be less liquid than other debt securities, and the price of structured instruments may be more volatile. Although structured instruments may be sold in the form of a corporate debt obligation, they may not have some of the protection against counterparty default that may be available with publicly traded debt securities. Currency Risk: Foreign currencies may fluctuate in relative value to the U.S. dollar, adversely affecting the value of an investment and its returns. Client assets are valued in U.S. dollars. Clients may lose money if the local currency of a foreign market depreciates against the U.S. dollar, even if the market value of the client’s holdings appreciates. Legal Risks: Some investing strategies involve activities that may give rise to legal liabilities. For example, the owners of real estate or companies in the transportation, shipping, or construction industries may be liable for actual or potential harm to people, wildlife or the environment from, among other things, effluents, emissions, wastes, and resource depletion, arising out of or occurring in connection with a company’s activities. Investors in such companies may see a decline in the value of their investment or may, in some cases, be held personally liable. Liquidity Risk: Liquidity risk exists when SBIFML is required to liquidate investments to meet a client's pension funding obligations or any other funding requirement. SBIFML may be required to sell a security at a disadvantageous time or at a price lower than it otherwise would expect to receive. In addition, certain investments, such as real estate and private funds, may be difficult to sell, thereby requiring SBIFML to sell liquid investments that it would otherwise wish to retain. Finally, when SBIFML liquidates a position to satisfy a client's fund requirement, the client foregoes any potential future appreciation in the value of the liquidated position. 10  Item 9 – Disciplinary Information SBI Funds Management Limited SBI Funds Management Limited (SBIFML) had received Show Cause Notice dated August 02, 2024 from Directorate General of GST Intelligence (DGGI) Mumbai office under section 74 of GST Act, regarding Input Tax Credit (ITC) not eligible on brokerage expenses for the period July 2017 to October 2018 amounting to Rs 65.97 crore along with applicable interest & penalty. SBIFML has replied to said show cause notice stating ITC eligibility on brokerage expenses. SBIFML has further received a demand order from GST department under section 74 of the CGST Act, on 23rd January 2025, demanding Rs. 65.97 crore as tax plus equivalent amount as a penalty, along with applicable interest on account of disputed input tax credit (ITC) availed and utilised on services of distribution commission during the period July 2017 to Oct 2018. SBIFML has obtained legal opinion on the matter, and appeal has been filed on 29th March 2025 against the said demand order by pre-depositing 10% amount Rs 6.59 Crore. Apart from this, the details of pending litigation or proceedings, findings of inspection or investigations for which action may have been taken or initiated by regulatory authority against SBI Funds Management Limited in a capacity of Investment Manager to the SBI Mutual Fund are mentioned below: a) The Securities and Exchange Board of India (“SEBI”) has initiated an investigation for the transactions in the shares of M/S Polaris Software Lab Limited, made during the period April 01, 2002 to May 31, 2002 by SBI Mutual Fund, having suspected SBI Mutual Fund of indulging in insider trading on account of proposed merger of M/S Orbi Tech Solutions with M/S Polaris Software Lab Limited, i.e. “unpublished price sensitive information” (“UPSI) about Polaris under the SEBI (Prohibition of Insider Trading) Regulations, 1992. SBI Mutual Fund has denied having violated any insider trading regulation or the SEBI Act. SEBI had issued a show cause notice (“SCN”) on June 20, 2007 and SBI Mutual Fund has replied to SEBI on June 30, 2008. Since then, there has been no further communication on the matter from SEBI to date. b) SBI Mutual Fund had received show cause notice under section 74(1) of CGST Act, 2017 Section 50(3) and Section 122(1) read along with corresponding MGST Act ,2017 on 24th April 2023 from Goods & Service Tax Department (GST) (CGST & CX Mumbai -East office) asking us why GST amounting to Rs 6.26 Cr not paid on Securities Lending & Borrowing (SLB) income for the period July,2017 to October 2018 along with applicable interest & penalty based on the Circular No. 119/38/2019-GST dated 11th October 2019 issued by Central Board of Indirect Taxes and Customs (CBIC). We had replied to said show cause notice stating non- applicability GST on SLB income along with payment of tax amount under protest (from AMC books) on 1st June 2023. Further, SBI Mutual Fund received demand order dated 30th October 2024 (OIO-ME/JC/VR/188/GST/2024- 25) under section 74(9) of CGST Act, 2017, Section 50(3) and Section 122(1) read along with corresponding MGST Act, 2017 and read with section 20 of IGST from GST (CGST & CX Mumbai -East office) of Tax amount Rs. 6,25,81,979/- along with Penalty of Rs. 6,25,81,979/- and applicable interest on SLB income for the period July 2017 to October 2018. Tax amount has been already paid under protest from AMC books. We have filed appeal against the said demand order on 28th January 2025. 11  Item 10 – Other Financial Industry Activities and Affiliations SBIFML is obligated to disclose if it, or any of its related persons are involved in other financial industry activities, such as those of a broker-dealer, commodity pool operator or a futures commission merchant, if such activities are material to SBIFML’s advisory business. SBIFML is also obligated to disclose if it receives compensation from other advisers for recommending or selecting those advisers. SBIFML may advise the purchase of securities where an affiliate of SBIFML serves as underwriter. However, all such advice / transactions shall be in line with Investment Policy / internal guidelines of SBIFML. Other than the foregoing, SBIFML does not have any other financial industry activities or affiliations to report. In addition, SBIFML does not receive compensation from other advisers for recommending or selecting them. Item 11 – Code of Ethics, Participation or Interest in Client Transactions and Personal Trading SBIFML has a strict Code of Ethics under which Advisory Employees’ personal transactions are reviewed for compliance with the Code of Ethics and to help assure avoidance of conflicts of interest. SBIFML will provide a copy of its Code of Ethics to any client or prospective client upon request. SBIFML may buy/sell/ as well as advise the purchase/sale of securities under its various activities viz, mutual fund, PMS, AIF and management & advisory services to FPI I & FPI II clients that are recommended to the clients. To address any potential conflicts of interest from this practice, SBIFML and its employees may not trade in a manner that would be adverse or detrimental to client trades. All personal trading transactions of employees are undertaken strictly in compliance with Code of Conduct and Employee Dealing Policy to avoid any conflict of interest. SBIFML has also implemented a Policy for Prevention and management of Conflict of Interest to address such types of conflicts, if any arises. SBIFML may recommend securities to the clients which are already part of the investment made under various other advisory activities. Investments are made in the name of the respective schemes managed and SBIFML at no point of time intends to participate directly or indirectly in the management of the issuers. SBIFML undertakes all transaction on arm’s length basis and in the best interest of its investors / clients. Item 12 – Brokerage Practices Best Execution, Trade Allocation and Market Errors Policy SBIFML has a Best Execution, Trade Allocation and Market Errors Policy and reviews trades periodically to ensure that the Policy is followed. “Best Execution” means that SBIFML will execute securities transactions for clients in such a manner that the clients’ total cost or proceeds in each transaction is the most favorable under the circumstances. In assessing whether this standard is met, SBIFML will consider the full range and quality of the executing broker’s services when selecting a broker/dealer. This assessment will include, but not be limited to, the broker/dealer’s execution quality and capability; trading expertise; accuracy of execution; reputation and integrity; fairness in resolving disputes; order handling capacity; commission rates; financial responsibility; responsiveness; and the value of any research services provided. SBIFML will use its best efforts to obtain information as to the general level of commission rates being charged by the brokerage community from time to time and evaluate the overall reasonableness of brokerage commissions to be paid on client portfolio transactions by reference to such data. Receipt of research services from brokers will be a factor in selecting a broker whom SBIFML believes will also provide quality executions of transactions at competitive commission rates. Receipt of other products or services from brokers will not be a factor in the selection or evaluation of brokers. The research services which will be a factor in 12  the selection of brokers will include not only a wide variety of reports, charts, publications and data on such matters as economic and political strategy, account performance, credit analysis, stock and bond market conditions and projections, asset allocation and portfolio structure, but also arranging meetings with management representatives of issuers and with other analysts and specialists. Research may be used for all clients of SBIFML and its affiliates. No client will be charged for the research. Investment Discretion SBIFML will make the determination as to the securities bought or sold using the discretionary authority granted to it by its clients. Fixed income securities will generally be purchased from the issuer or a primary market maker acting as principal on a net basis or in the secondary market with brokerage commission paid by the client. Such securities, as well as equity securities, may also be purchased from underwriters at prices that include underwriting fees. Soft Dollar Policy SBIFML does not receive soft dollar arrangements for its services, and it has no such arrangements with respect to US-based clients. SBIFML may receive research-related benefits from various brokers. However, the research is used exclusively for the benefit of the Client accounts and there is no commitment (written or verbal) of commissions in order to receive the research benefits. Trade Aggregation There is an aggregation or bunching of Client trades for Indian Residents, though it has no such arrangements with respect to US-based clients. However, there is no preferential allocation given to any Client or Class of Clients in the event of a partial execution of any trade. Item 13 – Review of Accounts Reviews: SBIFML reviews the holdings of the funds which it manages, as well as institutional and individual advisory accounts. Accounts will be reviewed on a continuing basis rather than on an arbitrary periodic schedule. Any development affecting the portfolio structure, or an existing holding will trigger a review and appropriate action. A continuous day-to-day review will be made of securities held in the portfolios as well as a broad group of other securities in order to determine what changes, if any, should be made in the portfolios. Reviewers: Each advisory client account will be reviewed by Advisory Employees, who will confer with the client in the development of appropriate investment objectives and guidelines for the account and supervise the investment of the account according to those specifications. Reports: SBIFML issues periodic reports, no less frequently than monthly, to each investment advisory client. Each client receives monthly reports from their custodial clearing firm should there be activity in the client account during any given month. Item 14 – Client Referrals and Other Compensation Other than the compensation described in Item 5 – Fees and Compensation, SBIFML does not receive an economic benefit from anyone other than its clients for advisory services. SBIFML does not in any way compensate any person for any client referrals. Item 15 – Custody SBIFML does not provide custodial services to its clients. Client assets are held with banks, registered broker-dealers or other “qualified custodians.” Clients receive statements directly from the qualified custodians at least quarterly. Clients are urged to carefully review those statements and compare the custodial records to the reports provided 13  by SBIFML. The information in SBIFML’s reports may vary from custodial statements based on accounting procedures, reporting dates or valuation methodologies of certain securities. Item 16 – Investment Discretion SBIFML will make the determination as to the securities bought or sold using the discretionary authority granted to it by its clients through the client agreement and a power of attorney. Fixed income securities will generally be purchased from the issuer or a primary market maker acting as principal on a net basis or in the secondary market with brokerage commission paid by the client. Such securities, as well as equity securities, may also be purchased from underwriters at prices that include underwriting fees. SBIFML’s brokerage practices are discussed in more detail in Item 12 – Brokerage Practices. Item 17 – Voting Client Securities SBIFML also has a Proxy Voting policy which defines the principles that form the basis of all votes exercised by the company. If there is any specific request from a client to vote in a proxy, SBIFML may do so, in the manner as advised by the client. When voting proxies, SBIFML takes utmost care to ensure that all decisions are made solely in the interests of the funds/investors and with the goal of maximizing the value of their investments. However, SBIFML, at no point in time intends to participate directly or indirectly in the management of the companies. SBIFML has adopted general guidelines for voting proxies. Corporate Governance issues are various and continuously evolving. The guidelines set forth are not and cannot be a comprehensive survey of the proxy voting guidelines as all kinds of issues cannot be anticipated. Therefore, these guidelines rather reflect some of the principles that will generally be supported by SBIFML. However, SBIFML may exercise its discretion and act accordingly in some instances when it determines that based on the facts, it is in the best interest of the fund as a shareholder. In case of conflict of interests, the Proxy Voting Committee of SBIFML will specifically review all such proposals and will take voting decisions in the best interest of clients. The Committee shall at all times have the discretion to decide to exercise a vote for or against the proposal in line with the Policy. The Committee may also take an external opinion or refer/consult the matter to the Executive Committee comprising of Senior Management. This policy is uploaded on the website of SBIFML (www.sbimf.com). Further, periodical disclosures pertaining to the exercise of votes cast are made available on the website of SBIFML (www.sbimf.com). Item 18 - Stewardship Code SBIFML’s vision is to be a trusted and respected Asset Manager by being an ethical, responsive and innovative partner in investment solutions. SBIFML’s fiduciary responsibilities towards its clients include long-term wealth creation, protection of interest of investors and risk mitigation, and towards the community at large include matters of social, governance and environmental factors. At SBIFML, it is a core belief that a business, run in best interests of all stakeholders seldom fails to create a lasting value for its investors. This responsibility, of not trying to maximise short-term profitability, but ensuring optimisation of long-term return and risks is well elucidated in our Responsible Investment Policy. We are among the first UNPRI signatories from India, and also the first Mutual Fund in India to adopt the Stewardship Code. Stewardship Responsibilities are intended to protect their clients' wealth. Such increased engagement is also seen as an important step towards improved corporate governance in the investee companies and gives a greater fillip to the protection of the interest of investors in such companies. 14  Item 19 – Financial Information Registered investment advisers are required to provide clients with financial information or disclosures about their financial condition in this Item. SBIFML has no financial commitments that impair its ability to meet contractual and fiduciary commitments to its clients and has never been the subject of a bankruptcy proceeding. ------------------------------- 15