Dbs Chola Mutual Fund (Debt) - 042008

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    Key Information Memorandum and

    Application Form for Debt Schemes

    This Key Information Memorandum (KIM) sets forth the information, which a prospective investor ought to know before investing. For

    further details of the Scheme / Mutual Fund, due diligence certificate by the AMC, Key Personnel, investors rights & services, risk

    factors, penalties & pending litigations, associate transactions etc., investors should, before investment, refer to the Offer Document

    available free of cost at any of the Investor Service Centres or distributors or from the website www.dbscholamutualfund.com

    The Scheme particulars have been prepared in accordance with Securities and Exchange Board of India (Mutual Funds) Regulations,

    1996, as amended till date, and filed with Securities and Exchange Board of India (SEBI). The units being offered for public subscription

    have not been approved or disapproved by SEBI, nor has SEBI certified the accuracy or adequacy of this KIM.

    Investors are advised to consult their Legal, Tax, Finance and other Professional Advisors before making decision to invest in or redeem

    the units, in regard to tax / legal issues relating to their investments in the Scheme(s) / Plan(s).

    The date of this Key Information Memorandum is August 2, 2007.

    Debt Schemes

    World Trade Centre, Centre 1, 27th Floor,

    Unit 1, Cuffe Parade, Mumbai 400 005

    DBS Chola Triple Ace

    DBS Chola Freedom Income Short Term Fund

    DBS Chola Liquid Fund

    DBS Chola Gilt Fund

    DBS Chola Monthly Income Plan(a scheme with no assured return)

    DBS Chola Short Term Floating Rate Fund

    DBS Chola Treasury Management Fund

    Offer of Units at NAV based prices plus applicable load, if any.

    SPONSOR

    Cholamandalam DBS Finance LimitedRegistered Office: Dare House, No. 2, N S C Bose Road, Chennai - 600 001

    INVESTMENT MANAGER

    DBS Cholamandalam Asset Management LimitedRegistered Office:Dare House, No. 2, N S C Bose Road, Chennai - 600 001

    Head Office:World Trade Centre, Centre 1, 27th Floor, Unit 1,

    Cuffe Parade, Mumbai - 400 005

    TRUSTEE

    DBS Cholamandalam Trustees LimitedRegistered Office: Dare House, No. 2, N S C Bose Road, Chennai - 600 001

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    1Key Information Memorandum - DEBT SCHEMES

    Name of Scheme DBS Chola Triple Ace DBS Chola Freedom Income Short Term FundInvestment Objective The investment objective of the scheme would be to provide regular and stable income

    to Unitholder. The corpus of the scheme would be invested primarily in debt marketsecurities, such as non-convertible debentures, bonds issued by corporates, bank andgovernment, commercial paper, certificates of deposit and other money marketinstruments. The scheme would invest predominantly in securities rated by the CreditRating and Information Services of India Ltd. (CRISIL), or any othe rating agency.

    An Income Scheme with at least 80% investments in Fixed IncomeSecurities with the objective of generating regular and stable income forthe unitholders of the Scheme. The balance will be invested in moneymarket instruments of high quality. The Scheme will not invest in equitiesor equity related instruments.

    Asset Allocation Pattern

    of the Scheme

    Type of Instrument Allocation (% of Net Assets)

    D ebt & Gove rnment Securi ti es (i nc luding cash / cal l money) 80-100Money Market instruments (including cash / call money) 0-20

    Type of Instrument Allocation (% of Net Assets)

    Debt Securities 80-100Money Market instruments (includin g cash / call mone y) 0-100

    Risk Profile of the Scheme Mutual Fund investments are subject to market risks. Please read the Offer Document carefully for details on risk factors before investment.

    Plans and Options Plans Options FacilityRegular Quarterly Dividend, Semi-annually Dividend, Bonus Payout and

    and Cumulative* Reinvestment**

    * If no option is specified at the time of application, the default option is Cumulative Option.

    ** If no facility is specified the default facility is dividend re-investment

    Plans Options Facility

    Regular Monthly / Semi-annually Dividend and Cumulative* Payout and Reinvestment**Institutional Weekly / Monthly Dividend and Cumulative* Payout and Reinvestment**DDRIP^ Reinvestment* If no option is specified at the time of application, the default option is Cumulative Option.** If no facility is specified the default facility is dividend Re-investment^ w.e.f. May 17, 2007 DDRIP - Daily Dividend Reinvestment Plan

    Applicable NAV (after the schemeopens for repurchase and sale)

    The applicable NAV for purchase or redemption or switching of units will be based on the time of the Business Day on which the application is accepted.Please refer to Page No. 5 for further details.

    Minimum ApplicationAmount (Under eachPlan / Option)

    Purchase / Repurchase Minimum Amount

    First Purchase Rs. 2,000 and in multiples of Rs. 100/-

    Additional Purchase Rs. 1,000 and in multiples of Rs. 100/-Repurchase Rs. 500 or 50 units as the case may be

    Plans Purchase / Repurchase Minimum AmountRegular First Purchase Rs. 3,000 and in multiples of Rs. 100/-

    Additional Purchase Rs. 1,000 and in multiples of Rs. 100/-

    Institutional First Purchase Rs. 10,00,000/-Additional Purchase Rs. 1,00,000 and in multiples of Re. 1/-

    Daily Dividend First Purchase Rs. 1,00,000 and in multiples of Re. 1/-Reinvestment Plan Additional Purchase Rs. 5,000 and in multiples of Re. 1/- thereafterRegular / Institutional Repurchase Rs. 500 or 50 units as the case may be

    Despatch of repurchase(Redemption) request

    Within 10 working days of the receipt of the redemption request at the official points of acceptance of DBS Chola Mutual Fund

    Benchmark Index CRISIL Composite Bond Fund Index CRISIL Short Term Fund Index

    Dividend Policy Please refer to Page No. 5 for detailsName of the Fund Manager Mr. Ashish NigamName of the Trustee Company DBS Cholamandalam Trustees Ltd.

    Expenses of the Scheme

    (i) Load Structure

    Continuous Offer Period

    Investment Entry Load Exit Load

    Rs. 10 Lakh NIL NIL

    The Trustee reserves the right to change / modify the load structure from a prospective date.

    (ii) Actual Expenses for 06-07 Actual expenses for the scheme were Rs. 37.15 lacs amounting to 2.25%of Average Daily Net Assets for the financial year 2006-07.

    Actual expenses for the scheme were Rs. 25.15 lacs amounting to 0.55%of Average Daily Net Assets for the financial year 2006-07

    (iii) Recurring Expenses(% of weekly AverageNet Assets)

    Net Assets % of weekly Average Net Assets

    First Rs. 100 crores 2.25

    Next Rs. 300 crores 2.00

    Next Rs. 300 crores 1.75

    Balance 1.50

    Tax Treatment for the Investors Please refer to Page No. 5 for details

    Continuous Offer Period

    Entry Load Exit Load

    NIL NIL

    The Trustee reserves the right to change / modify the load structure from a prospective date.

    Performance of the Scheme(As at March 31, 2007)

    Returns Data

    Compounded Annualised Returns Scheme Returns % Benchmark Returns %*

    For the Last 1 year 3.35 3.72

    For the Last 3 years 2.01 2.39For the Last 5 years 5.20 5.31

    Since Inception (31/03/97) 9.25

    * CRISIL Composite Bond Fund Index is the Benchmark Index for the Scheme

    Date of Inception is March 31, 1997

    DBS Chola Freedom Income - Short Term Fund -Regular Plan - Cumulative Option

    Returns Data

    Compounded Scheme Benchmark

    Annualised Returns ReturnsReturns % %*For the Last 1 year 6.81 5.68For the Last 3 years 5.00 4.18For the Last 5 years 5.84 5.23Since Inception(08/03/02) 5.86 * CRISIL Short Term Fund Index is the Benchmark Index for th e Scheme.The data is available from 30th March, 2002Date of Inception is March 8, 2002

    DBS Chola Freedom Income - Short Term Fund -Institutional Plan - Cumulative Option

    Returns Data

    Compounded Scheme BenchmarkAnnualised Returns ReturnsReturns % %*

    For the Last 1 year 6.86 5.68For the Last 3 years 5.00 4.18Since Inception(10/04/03) 5.29 4.51

    * CRISIL Short Term Fund Index is the Benchmark Index for th e Scheme.The data is available from 30th March, 2002Date of Inception is April 10, 2003. Hence 5 years returns are not available

    Year-wise returns for the last 5 financial years

    8.00

    7.00 6.00

    5.00

    4.00

    3.00

    2.00

    1.00

    0.00

    31/03/06-

    31/03/07

    31/03/04-

    31/03/07

    10/04/03-

    31/03/07

    Year-wise returns for thelast 3 financial years

    Scheme Returns

    Benchmark Returns

    10.00

    9.00

    8.00

    7.00

    6.00

    5.00

    4.00

    3.00

    2.00

    1.00

    0.00

    31/03/06-

    31/03/07

    31/03/04-

    31/03/07

    31/03/02-

    31/03/07

    31/03/97-

    31/03/07

    Scheme Returns Benchmark Returns

    8.00

    7.00

    6.00

    5.00

    4.00

    3.00

    2.00

    1.00

    0.00

    31/03/06-

    31/03/07

    Year-wise returns for thelast 5 financial years

    Scheme Returns

    Benchmark Returns

    31/03/04-

    31/03/07

    31/03/02-

    31/03/07

    08/03/02-

    31/03/07

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    2 Key Information Memorandum - DEBT SCHEMES

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