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May 2015

Indian equity markets continued to sway with the domestic/international news flows and government actions for the second successive month. CNX Nifty and S&P BSE Sensex fell 3.65% and 3.38% respectively owing to weak domestic cues like a below normal monsoon prediction by India Meteorological Department (IMD), minimum alternate tax issues for FIIs and disappointing quarterly earnings from IT majors. Bigger losses were avoided after Moody’s Investor Services revised India’s sovereign rating outlook to “Positive” from “Stable” but have maintained the rating at the lowest investment grade. Hopes of another rate cut by the Reserve Bank of India (RBI) in its April policy meet also lent buoy, but the central bank preferred to keep rates unchanged. Investors also cheered encouraging domestic industrial production and CPI inflation data. Major international and domestic institutions are optimistic about the growth potential of the Indian economy due to the government’s initiatives of the past one year and a decline in inflation and crude oil prices. The World Bank has projected India’s economic growth at 7.5% for the current financial year FY16 and at 8% by 2017-18. In May, the equity markets are likely to be guided by corporate results with FII investments and domestic macro-economic data continuing to influence the market direction.

The mutual fund industry continues to evolve with some regulatory developments introduced by SEBI like the introduction of a pictorial “riskometer” to communicate the level of risk in schemes, a monthly mandate to conduct stress tests on liquid & money market scheme portfolios and removing restrictions on NBFCs to sell mutual funds. Mutual Funds are and continue to remain an ideal, convenient and transparent investment option to invest for investors. The benefits and nuances of mutual funds need to be continually informed to our distribution partners and investors. However, I urge investors to proactively understand different aspects of any investment option like suitability vis-à-vis time horizon of the investment, risk/return potential and taxation. “Risk comes from not knowing what you’re doing”, a quote by the legendary investor Warren Buffett, is an apt one and one should consult a financial advisor if in doubt before making any investment decision.

Investing the right way is simple and boring. Identify your goals and keep investing regularly a pre-determined amount through a Systematic Investment Plan. Equity-based funds are ideal for the long-term goals in life to achieve better inflation-adjusted returns and mutual funds offer an investment option for any time-horizon and need. Do not make frequent changes and review periodically to ensure that your portfolio is optimally placed to achieve your goals.

Visit our site www.sbimf.com to experience the convenience of investing with mutual funds. The site allows KYC compliant investors to invest in any of our schemes and New Fund Offers in a few minutes. Also, m-Easy our mobile based service allows you to complete any mutual fund transaction simply by sending an SMS from your registered mobile number with us. Please feel free to call on our dedicated customer care numbers customer care numbers 1 800 425 5425 and 044-28881101/044-28881136 from Monday to Saturday (8am to 10pm) or write to us at customer.delight@sbimf.com with your queries. Alternatively, you can also visit your nearest SBI MF Branch for any assistance.

Best Regards,
Dinesh Kumar Khara
Managing Director & Chief Executive Officer

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