key information memorandum & common application form …€¦ · systematic withdrawal plan...

Sponsors: Prudential plc (through its wholly owned subsidiary,Prudential Corporation Holdings Limited),142 Holborn Bars, London EC 1N 2NH, UK, and

ICICI Limited, ICICI Towers, Bandra Kurla Complex, Bandra(E), Mumbai 400 051.

Investment Manager: Prudential ICICI Asset Management Company LimitedCorp. Office: Contractor Building, 3rd Floor, 41, R. KamaniMarg, Ballard Estate, Mumbai 400 038.

Regd. Office: 206 Ashoka Estate, 2nd Floor, 24 BarakhambaRoad, New Delhi 110 001.

Trustee : Prudential ICICI Trust LimitedRegd. Office: 206 Ashoka Estate, 2nd Floor, 24 BarakhambaRoad, New Delhi 110 001.

Servicedby CAMS

www.pruiciciamc.com

KEY INFORMATION MEMORANDUM & COMMON APPLICATION FORM

Open ended liquid income fundGrowth and Dividend Reinvestment Option

Open ended debt fundGrowth and Dividend Option

Open ended gilt fundGrowth and Dividend Option

Open ended debt fundCumulative and Dividend Option

Open ended balanced fundGrowth and Dividend Option

Open ended equity fundGrowth and Dividend Option

Open ended equity linked savings schemeGrowth and Dividend Option

Open ended FMCG sector fundGrowth and Dividend Option

Open ended Technology sector fundGrowth and Dividend Option

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Prudential ICICI Mutual Fund

2

Type

Investment Pattern

Fund Objective

Investment horizon

Net Asset Value

Business Day

Option

Application Amount

Min. Additional Investment

Portfolio Disclosures

Entry Load*

Exit Load

Redemption Cheques Issued ##

Minimum Redemption Amt.

Cut off time

Systematic Investment Plan

Systematic Withdrawal Plan

Switch Facility

Tax Benefits (refer to page 16)

Nomination Facility

Mode of Holding

Recurring Expenses**Investment Management ExpensesOther recurring expensesTotal

Fund Manager

Open-ended Debt Fund

Debt Securities 75% & Money Market & Cash 25%

To generate income through investments in a basketof debt instruments of various maturities with a viewto maximise income while maintaining the optimum

balance of yield, safety and liquidity.

Suitable for investors looking for steady returns atrelatively low risk across a medium to long term horizon.

Calculated & declared on every Business Day

A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai are closed, (3) a day onwhich sale and redemption of units is suspended by

the Trustee.

Growth & Dividend

Rs. 5,000/-(plus in multiples of Re. 1)

Rs. 500/-

Quarterly

Nil

(Any purchase transaction upto Rs.1 lac –0.50% if exit within 6 mths.) †

(Any purchase transaction over Rs.1 lac –0.50% if exit within 3 mths.) †

Within 3 Business Days

Rs. 500/-

3.00 p.m.

Monthly: Minimum Rs. 3000 + 6 post-datedcheques for Rs. 500 each.

Quarterly: Minimum Rs. 3000 + 2 post-datedcheques for Rs. 1,500 each.

Minimum of Rs. 500/- and multiples thereof.

Available

Tax free dividend, Capital Gains Tax andIndexation benefits

Available

Single, Joint or Anyone or Survivor

1.25%0.75%2.00%

Sanjay K. GarodiaPGDM (IIM-A), B.E.

Over 4 yrs experience in debt markets& fund management.

Income PlanLiquid PlanKey Features – Debt FundsOpen-ended Liquid Income Fund

Money Market 80% & Debt Instruments 20%

To generate reasonable returns from low riskinvestments which provide high level of liquidity.

Suitable for investors looking for short-terminvestment at relatively low risk.


A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai are closed, (3) a day onwhich sale and redemption of units is suspended by

the Trustee.

Growth Dividend Reinvestment

Rs. 15,000/- Rs.1 lac(plus in multiples of Re. 1)

Rs. 5000/- Rs. 1 lac

Semi-annually

Nil

Nil(0.25% if exit within 5 days)

Within 1 Business Day

Rs. 100/- Rs. 1 lac

12.00 noon 10.30 a.m.

Monthly: Minimum N.A.Rs. 9000 + 6 post-dtdcheques for Rs. 1,500 each.

Quarterly: Minimum N.A.Rs. 9000 + 2 post-dtdcheques for Rs. 4,500 each.

Minimum of Rs.5000/- N.A.and multiples thereof.

Available

Capital Gains Tax & Indexation benefits

Available


0.70%0.30%1.00%


Over 4 yrs experience in debt markets &fund management.

* The Trustees reserves the right to change/modify the load structure at a later date for the Schemes.** Investors are requested to read the section on “Fees and Annual Recurring expenses” elsewhere in this application form. The recurring expenses indicated above may change subject to ceilings

under the Regulations

The Schemes of Prudential ICICI Mutual Fund are managed by the Chief Investment Officer, Mr. Dileep Madgavkar [Associate of Institute of Chartered Accountants, B.Com(Hons.)(Cal. Univ.)]. He has over 13 years experience in Treasury and Fund Management. He is supported by a team of Fund Managers as above.


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Open-ended short-term Gilt Fund

Gilt Securities (incl. Treasury Bills). Average Maturitynormally not to exceed 3 years.

To generate income through investment in Gilts ofvarious maturities.

Suitable for investors looking for steady returns atrelatively low risk across a short to medium term horizon.


A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai or NSE or RBI are closed,(3) a day on which there is no RBI clearing/settlement

of securities or (4) a day on which sale andredemption of units is suspended by the Trustee.

Growth & Dividend


Rs. 5000/-

Monthly

Nil

Nil(0.25% if exit is within 1 month) †


Rs. 5,000/-

10.30 a.m.

Not Available

Not Available

Available

Tax free dividend, Capital Gains Tax and Indexationbenefits

Available


0.75%0.25%1.00%



Open-ended medium-term Gilt Fund

Gilt Securities (incl. Treasury Bills). Average Maturitynormally not to exceed 8 years.

To generate income through investment in Gilts ofvarious maturities.

Suitable for investors looking for steady returns atrelatively low risk across a medium to long term horizon.


A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai or NSE or RBI are closed,(3) a day on which there is no RBI clearing/settlement

of securities or (4) a day on which sale andredemption of units is suspended by the Trustee.

Growth & Dividend


Rs. 5000/-

Monthly

Nil

Nil(0.50% if exit is within 1 year)


Rs. 5,000/-

10.30 a.m.

Not Available

Not Available

Available


Available


0.75%0.25%1.00%



Gilt – Treasury Gilt – Investment Monthly Income PlanOpen-ended Income Fund with no assured returns

Debt securities, money market instruments,securitised debt & Cash - 85%, Equity & Equity

related securities 15%

To generate regular income through investments indebt and money market instruments and also to

generate long term capital appreciation by investing aportion in equity and equity related instruments.

Suitable for investors seeking regular returns and forthe medium to long term investor.


A day other than (i) Saturday and Sunday or (ii) a day on whichthe Principal Stock Exchange with reference to which the

valuation of the securities under the Scheme is done or theWhole Sale Debt Market of National Stock Exchange or the

Reserve Bank of India or Banks in Mumbai are closed or (iii) aday on which there is no RBI clearing / settlement of securities;

or (iv) a day on which the Sale and Redemption of Units issuspended by the Trustee / AMC.

Dividend (monthly, quarterly, semi annually) andCumulative. Automatic Encashment Plan (AEP)

also offered.

Rs. 25,000(plus multiples of Re 1)

Rs.1,000 under each option

Quarterly

Nil

Nil(0.50% if exit is within 6 months)


Minimum of Rs.1,000.

3:00 p.m.

Monthly: Minimum Rs 10,000 + 6 post dated chequesfor Rs 2,500 each

Quarterly: Minimum Rs 10,000 + 4 post datedcheques for Rs 3,750 each

Minimum of Rs.1000 and multiples thereof.

Available


Available


1.25%1.00%2.25%

Dileep MadgavkarAssociate of Institute of Chartered Accountants,

B.Com (Hons.) (Cal. Univ.)Over 13 years experience in Treasury and Fund

Management.


## As per the Regulations, the Fund shall dispatch redemption proceeds within 10 Business days of receiving the redemption request. Investors are advised to refer to the sections titled“Suspension of sale and redemption of units” and “Right to limit Redemption”. @ w.e.f. 3rd April, 2000. † w.e.f. 1st August, 2000.

Note: The fundamental attributes of a Scheme cannot be changed without the consent of not less than 75% of the unitholders.

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4

Type

Investment Pattern

Fund Objective

Investment horizon

Net Asset Value

Business Day

Option

Application Amount

Min. Additional Investment

Portfolio Disclosures

Entry Load*

Exit Load

Redemption Cheques Issued ##

Minimum Redemption Amt.

Cut off time

Systematic Investment Plan

Systematic Withdrawal Plan

Switch Facility

Tax Benefits (refer to page 16)

Nomination Facility

Mode of Holding

Recurring Expenses**Investment Management ExpensesOther recurring expensesTotal

Fund Manager

Open-ended Equity Fund

Equity and Equity related 95% & Debt, Money Marketand Cash 5%

To seek to generate long-term capital appreciationfrom a portfolio that is invested predominantly in

equity and equity related securities.

Suitable for investors who seek to invest in equitysecurities.


A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai and Mumbai Stock

Exchanges are closed, (3) a day on which sale andredemption of units is suspended by the Trustee.

Growth & Dividend


Rs. 500/-

Quarterly

1.75%@

Nil


Rs. 500/-

3.00 p.m.

Monthly: Minimum Rs. 3000 + 6 post-dated chequesfor Rs. 500 each.

Quarterly: Minimum Rs. 3000 + 2 post-dated chequesfor Rs. 1,500 each.

Minimum of Rs. 500/-and multiples thereof.

Available

Tax free dividend, Capital Gains Taxand Indexation benefits

Available


1.25%1.25%2.50%

Krishna KumarACA, AICWA

Over 7 yrs experience in research& fund management.

Growth PlanBalanced FundKey Features – Equity FundsOpen ended Balanced Fund


To seek to generate long-term capital appreciationand current income from a portfolio that is invested in

equity and equity related securities as well asin fixed income securities.

Suitable for investors seeking long term capitalappreciation and current income.


A day other than (1) Saturday and Sunday, (2) a day onwhich banks in Mumbai or Mumbai Stock Exchange or

RBI are closed, (3) a day on which there is no RBIclearing/settlement of securities or (4) a day on which sale

and redemption of units is suspended by the Trustee.

Growth & Dividend


Rs. 1000/-

Quarterly

1.75%@

Nil


Rs. 1000/-

3.00 p.m.

Monthly: Minimum Rs. 3000 + 6 post-dated chequesfor Rs. 1,000 each.

Quarterly: Minimum Rs. 3000 + 4 post-dated chequesfor Rs. 1,500 each.


Available


Available


1.25%0.75%2.00%

R. MurlikrishnanACS, CAIIB, PGDPM

Over 9 yrs of experience infund management.

* The Trustees reserves the right to change/modify the load structure at a later date for the Schemes.** Investors are requested to read the section on “Fees and Annual Recurring expenses” elsewhere in this application form. The recurring expenses indicated above may change subject to ceilings

under the Regulations



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Open-ended Equity Linked Saving Scheme


To seek to generate long-term capital appreciationfrom a portfolio that is invested predominantly in

equity and equity related securities.

Suitable for investors seeking tobenefit from Sec. 88 tax concessions.

Calculated & declared on every Business day

A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai or Mumbai Stock

Exchange are closed, (3) a day on which sale andredemption of units is suspended by the Trustee.

Growth & Dividend

Rs. 500/-(plus in multiples of Re. 1)

Rs. 500/-

Semi-annually

1.75%

Nil

Within 3 Business Days after lock-in period of 3 yrs.

Rs.500/-

3.00 p.m.

Monthly: Minimum Rs. 500 + 6 post-dated cheques for Rs. 500 each.

Not available

Available after lock-in period.

Sec. 88, Tax free dividend, Capital Gains Tax &Indexation benefits

Available


1.25%1.25%2.50%

Mihir M VoraB.E. (Mechanical), PGDM (IIM-L)

Over 6 yrs experience inresearch & fund management.

Open-ended FMCG Sectoral Fund

Equity and Equity related in FMCG Companies 90%in & Debt, Money Market and Cash 10%

To seek to generate long-term capital appreciation froma portfolio that is invested predominantly in equity and

equity related securities of FMCG Companies.

Sectoral fund, suitable for investors seeking anexposure to the FMCG Sector.


A day other than (1) Saturday and Sunday, (2) a dayon which banks in Mumbai or National Stock

Exchange are closed, (3) a day on which sale andredemption of units is suspended by the Trustee.

Growth & Dividend


Rs. 500/-

Semi-annually

1.75%@

Nil


Rs. 500/-

3.00 p.m.


Quarterly: Minimum Rs. 3000 + 4 post-dated chequesfor Rs. 750 each.


Available


Available


1.25%1.25%2.50%

Mihir M VoraB.E. (Mechanical), PGDM (IIM-L)

Over 6 yrs experience inresearch & fund management.

Tax Plan FMCG Fund Technology FundOpen-ended Equity Fund

Equity and Equity related 90-95% & Debt, MoneyMarket and Cash 5-10%

To generate long-term capital appreciation byinvesting in equity & equity related securities of

technology intensive companies.

Suitable for investors who seek an exposure to IT,Telecom, Life Sciences and Media sectors.


A day other than (1) Saturday and Sunday or (2) aday on which the Stock Exchange, Mumbai or the

Reserve Bank of India or Banks in Mumbai are closedor (3) a day on which the Sale and Redemption of

Units is suspended by the Trustee/AMC.

Growth & Dividend


Rs. 1000/-

Quarterly

1.75%

Nil


Rs. 1,000/-

3.00 p.m.


Quarterly: Minimum Rs. 3000 + 4 post-dated chequesfor Rs. 1500 each.


Available


Available


1.25%1.25%2.50%

Kannan V.B.E. (Electronics), PGDM (IIM-A)

Over 5 yrs experience inresearch & portfolio management.


## As per the Regulations, the Fund shall dispatch redemption proceeds within 10 Business days of receiving the redemption request. Investors are advised to refer to the sections titled“Suspension of sale and redemption of units” and “Right to limit Redemption”. @ w.e.f. 3rd April, 2000. † w.e.f. 1st August, 2000.

Note: The fundamental attributes of a Scheme cannot be changed without the consent of not less than 75% of the unitholders.

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6

HIGHLIGHTS

• The Sponsors of the Fund are Prudential plc of the United Kingdom (UK) and ICICI Limited (ICICI).Prudential is one of the largest life insurance company in the UK and one of the leading life insurance companies in the world. It operates in over 15 countries and marketsmedium to long-term savings products, including life insurance, pensions and unit trusts. It has a total of over 10 million customers worldwide.ICICI is a premier financial institution and its principal business is to provide medium and long-term project financing / leasing, consumer finance and other types of financialservices to industry and individuals in India. The total financial assistance extended by ICICI since inception is Rs.1,28,443 crores as of September 30, 2000.

• Fund Management expertise – Prudential is one of the largest institutional Investors in the UK and has assets under management worldwide in excess of US$ 231 billion(over Rs. 10,62,600 crores approx.). It also has banking deposits of US$ 10.88 billion (approximately Rs. 50,048 crores). It invests globally and manages the long-termsavings of individuals with diverse risk profiles and needs.

• Prudential ICICI Asset Management Company Limited, the Investment Manager to the Prudential ICICI Mutual Fund, manages assets over Rs.4,832 crores as of December29, 2000 through 12 schemes.It is the largest asset management company in the private sector in the country. (Source: Letter dated 14th February, 2001 received from Credence India)

• High Liquidity - Being open ended Schemes, Units may be purchased or redeemed on every Business Day at NAV based prices. The Fund will, under normal circumstances,endeavour to despatch redemption cheques within 3 Business Days for Growth Plan, Income Plan, FMCG Fund, Technology Fund, Balanced Fund and Monthly Income Plan,2 Business Days for Gilt Fund and 1 Business Day for Liquid Plan.

• Under the Flexible Lifetime Investment Programme, investors may choose to alter the allocation of their investment among the schemes in order to meet their changingcircumstances during their lifetime.

• The investors under the Schemes can choose between a Growth Option and a Dividend Option. Dividend Reinvestment facility is also available. Prudential ICICI MonthlyIncome Plan offers an Automatic Encashment Plan at monthly/quarterly/half yearly rests for the investors of the Cumulative Option under the Scheme.

• The following Tax benefits are available under the prevailing tax laws and subject to change thereto:As per the provisions of Section 10(33) of the Income-tax Act, 1961, dividend distributions by the Fund will be tax exempt in the hands of Unitholders.For equity oriented scheme, as per the provisions of Section 115 R of Income-tax Act, 1961, the Fund will not pay, for a period of three years commencing from theAssessment Year 2000-2001, tax on the dividends distributed by it.For debt oriented schemes the Fund will pay a dividend tax as per the provisions of Income-tax Act, 1961.There will be no tax deduction at source (TDS) on redemptions (irrespective of the amount redeemed) for Unitholders resident in India.Investments in the Scheme will be exempt from Wealth Tax. For gift of units, Gift Tax will not be payable either by the donor or the donee. Investors who redeem units heldfor more than 12 months will get benefit of long term capital gains tax and resident investors will get the benefit of indexation.

RISK FACTORS

• Mutual Funds and securities investments are subject to market risks and there is no assurance or guarantee that the objectives of the Scheme will be achieved.• As with any securities investment, the NAV of the Units issued under the Schemes can go up or down depending on the factors and forces affecting the capital markets.• Past performance of the Sponsors, AMC/Fund does not indicate the future performance of the Scheme of the Fund.• The Sponsors are not responsible or liable for any loss resulting from the operation of the Scheme beyond the contribution of an amount of Rs. 22.2 lacs collectively made

by them towards setting up the Fund and such other accretions and additions to the corpus set up by the Sponsors.• Prudential ICICI Liquid Plan, Prudential ICICI Income Plan, Prudential ICICI Gilt Fund, Prudential ICICI Balanced Fund, Prudential ICICI FMCG Fund, Prudential ICICI Growth

Plan, Prudential ICICI Technology Fund and Prudential ICICI Monthly Income Plan are the names of the Scheme and do not in any manner indicate either the quality of theScheme or its future prospects and returns.

• The NAVs of Schemes offered in this document may be affected by changes in the general market conditions, factors and forces affecting capital markets in particular, levelof interest rates, various market related factors and trading volumes, settlement periods and transfer procedures.

• In the event of receipt of inordinately large number of redemption requests or of a restructuring of the Schemes’ portfolios, there may be delays in the redemption of Units.Please see “Risk Factors and Special Considerations” and “Right to Limit Redemptions”.

• The liquidity of the Schemes’ investments are inherently restricted by trading volumes in the securities in which it invests.• Investors in the Schemes are not being offered any guaranteed returns.

• Please refer to the Investment Strategy Sections for detailed risk factors.

This memorandum sets forth concisely, the information about the Schemes that a prospective investor should know before investing and the investor should retain this memorandumfor future reference. For further details on the Schemes investors are advised to refer to the Offer Documents.The particulars of the mutual fund Schemes offered under this Offer Document, have been prepared in accordance with the Securities and Exchange Board of India(Mutual Funds) Regulations, 1996, as amended till date and filed with the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, as amendedtill date and filed with the Securities and Exchange Board of India and the Units being offered for public subscription have not been approved or disapproved bythe Securities and Exchange Board of India nor has the Securities and Exchange Board of India certified the accuracy or adequacy of the Offer Documents.Due Diligence by the Asset Management Company: The AMC has exercised due diligence while preparing the Offer Documents and has submitted a Due DiligenceCertificate to SEBI in the format prescribed by the SEBI. Investors may refer to the Offer Documents for the contents of the Due Diligence Certificates.

Prudential ICICI Liquid PlanINVESTMENT PATTERN

Type Approx Allocation

Money Market securities 80%Debt securities * 20%

* including securitised debtSubject to the Regulations, the asset allocation pattern indicated above may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages stated above are only indicative and not absolute and that they can varysubstantially depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unitholders. Such changes inthe investment pattern will be for short term and defensive considerations.

INVESTMENT STRATEGYSince providing liquidity is of paramount importance, the focus will be to ensure thesame while seeking to maximize the yield. An appropriate mix of money market securities,government securities and fixed income securities will be used to achieve this. Theinvestment team of the AMC will carry out rigorous in depth credit evaluation of thedebt securities proposed to be invested in. The credit evaluation includes a study of theoperating environment of the issuer, the past track record as well as the future prospectsof the issuer and the short term/longer term financial health of the issuer. The AMC willstudy the macro economic conditions, including the political and economic environmentand factors affecting liquidity in an attempt to predict the direction of interest rates.Under normal circumstances up to 5% of portfolio may be invested in relatively illiquidsecurities. In case a debt instrument is not rated, specific approval of the Board of theAMC will be required prior to investment. In the event that such securities have to beliquidated immediately, the value realized on such securities could be adversely impacted.This might adversely impact the net asset value of the Scheme. Please refer to “Right toLimit Redemptions” and “Suspension of Sale and Redemption of Units” on page 16.


7

Portfolio Turnover : The portfolio turnover shall generally not exceed 10 times oncethe entire corpus is invested and excluding the portfolio turnover caused on account offresh inflows into the Scheme and money placed in call deposits.INVESTMENT OPTIONS AVAILABLE UNDER THE PRUDENTIAL ICICI LIQUID PLANInvestors under the Prudential ICICI Liquid Plan have the choice of a Growth option anda Dividend Reinvestment option. There will be two separate NAVs, one for the Growthoption and one for the Dividend Reinvestment option. Please see page 11 for details.Risk Factors and Other Considerations for the Income & Liquid Plans• Credit Risk: Debt securities are subject to the risk of an issuer’s inability to meet

interest and principal payments on its debt obligations and market perception ofthe creditworthiness of the issuer.

• Market Risk: Debt securities may also be subject to price volatility due to factorssuch as changes in interest rates and levels of market liquidity.

• Reinvestment Risk: At times, due to the non-availability of appropriate debtsecurities, the Scheme may not be able to invest the available funds in a mannerdesired by it immediately.

The liquidity of the Scheme’s debt investments may be restricted by trading volumes.The inability to sell the money market or debt securities held in the Scheme’s portfoliodue to the absence of a well developed and liquid secondary market for such securitiesmay result, at times, in losses to the Scheme, in case of a subsequent decline in thevalue of such securities.

Prudential ICICI Income PlanINVESTMENT PATTERN

Type Approx Allocation

Debt securities * 75%Money Market Securities & Cash 25%

* including securitised debtSubject to the Regulations, the asset allocation pattern indicated above may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages stated above are only indicative and not absolute and that they can varysubstantially depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unitholders. Such changes inthe investment pattern will be for short term and defensive considerations.

INVESTMENT STRATEGYThe AMC will analyze the credit worthiness of issuers of debt securities and evaluatethe past track record as well as the future prospects of the issuer before making aninvestment. The AMC will also be guided by the ratings of Rating Agencies such as CRISIL,CARE and ICRA. The AMC will attempt to achieve adequate diversification of the portfolioby investing in about 10-15 securities for the first Rs.100 crores of the corpus of theScheme. Subject to the limits indicated above, the Fund may invest a part of the portfolioin securities issued and guaranteed by State and Central Governments. The Fund mayalso invest in Securities of issuers supported by Government of India or State Governmentssubject to such securities satisfying the criteria relating to rating etc. Given that the liquidityof fixed income instruments is currently limited, the AMC will try to provide liquidity bystaggering maturities for various instruments, as well as holding a sufficient portion ofthe portfolio in more liquid government and corporate paper as well as money marketsecurities. Under normal circumstances 40 - 60% of portfolio may be considered to beinvested in illiquid securities. In case a debt instrument is not rated, specific approval ofthe Board of the AMC will be required prior to investment. Should there be a need toliquidate part or all of these securities in a very short duration of time, the AMC maynot be able to realize the full value of these securities. Consequently the NAV of theScheme may be impacted. Please refer to “Right to Limit Redemptions” and “Suspensionof Sale and Redemption of Units” on page 16.Portfolio Turnover : The portfolio turnover shall, generally, not exceed 10 times, oncethe entire corpus is invested and excluding the portfolio turnover caused on account offresh inflows into the Scheme and money placed in call deposits.

INVESTMENT OPTIONS AVAILABLE UNDER PRUDENTIAL ICICI INCOME PLANInvestors under the Prudential ICICI Income Plan have the choice of a Growth Option ora Dividend Option or a Dividend Reinvestment Option. There will be two separate NAVs,one for the Growth Option and another for the Dividend Option. Please see page 11for details.

Prudential ICICI Gilt FundINVESTMENT PATTERNThe Scheme aims at generating returns commensurate with zero credit risk by investingin securities created and issued by the Central Government and /or a State Governmentand/or repos/reverse repos in such government securities as may be permitted by RBI.The Scheme may also invest a portion of the corpus in the call money market or in analternative investment for the call money market as may be provided by RBI to meet theliquidity requirements. The Fund will seek to underwrite issuance of GovernmentSecurities subject to the prevailing rules and regulations as may be specified by SEBI/ RBIin this respect and may also participate in the auction of Government securities fromtime to time.

Subject to the Regulations and the guidelines of RBI, the investment pattern may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages of investments to be made between gilts and call money or any alternativefor the call money market provided by the RBI can vary substantially depending uponthe perception of the Investment Manager, the intention being at all times to seek toprotect the interests of the Unitholders. Such changes will be made for short termdefensive considerations.Provided that any change in the asset allocation affecting the investment profile of theScheme and amounting to a change in the fundamental attributes of the Scheme maynot be effected without obtaining the consent of three fourths of Unitholders inaccordance with Sub regulation (15) of Regulation 18 of the Regulations of SEBI (MutualFunds) Regulations 1996.

INVESTMENT STRATEGYThe Scheme aims at generating returns commensurate with zero credit risk by investingin securities created and issued by the Central Government and /or a State Governmentand/or repos/reverse repos in such government securities as may be permitted by RBI.The Scheme may also invest a portion of the corpus in the call money market or in analternative investment for the call money market as may be provided by RBI to meet theliquidity requirements. The Fund will seek to underwrite issuance of GovernmentSecurities subject to the prevailing rules and regulations as may be specified by SEBI/ RBIin this respect and may also participate in the auction of Government securities fromtime to time.The government securities market is the largest and the most liquid market in India. TheInvestment Manager believes that the various measures being initiated by RBI and thepriority being accorded to the development of this market will lead to further deepeningand widening of this market. The central and state governments raise large sums fromthe market every year to meet their revenue and capital expenditure. Banks, Non-BankingFinance Companies, insurance companies and provident funds are required by variousstatutes to invest in government securities and therefore are big investors in this market.The government securities market is expected to remain the most liquid market andprovides an avenue for investment where safety is of paramount importance. The Planswill afford an opportunity to the retail investors to invest in the government securities.Please refer to “Right to Limit Redemptions” and “Suspension of Sale and Redemptionof Units” on page 16.

INVESTMENT OPTIONS AVAILABLE UNDER THE PRUDENTIAL ICICI GILT FUNDInvestors under the Prudential ICICI Gilt Fund have the choice of a Growth option, aDividend option or a Dividend Reinvestment option. There will be two separate NAVs,one for the Growth option and one for the Dividend option. Please see page 11 fordetails.Risk Factors and Special Considerations• Generally, when interest rates rise, prices of fixed income securities fall and when

interest rates drop, the prices increase. The extent of fall or rise in prices is a functionof the existing coupon, days to maturity and the increase or decrease in interest rates.Price-risk is not unique to government securities but is true for all fixed incomesecurities. The default risk however, in respect of Government securities is zero.Therefore, their prices are influenced only by movement in interest rates in thefinancial system. On the other hand, in the case of corporate or institutional fixedincome securities, such as bonds or debentures, prices are influenced by creditstanding of the issuer as well as the general level of interest rates.

• Even though the Government securities market is more liquid compared to otherdebt instruments, on occasions, there could be difficulties in transacting in the marketdue to extreme volatility or unusual constriction in market volumes or on occasionswhen an unusually large transaction has to be put through.

Prudential ICICI Monthly Income Plan

INVESTMENT PATTERN

Type of security Indicative Risk ProfileAllocation

(% of corpus)

Debt securities, Money Marketinstruments, securitised debt &Cash (including – money at Call) 85% Low to medium

Equities & Equity related securities 15% Medium to high

Subject to the Regulations, the asset allocation pattern indicated above may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages stated above are only indicative and not absolute and that they can varysubstantially depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unit holders. Such changes inthe investment pattern will be for short term and defensive considerations.INVESTMENT STRATEGYInvestment Strategyi) Fixed Income securities: The AMC aims to identify securities which offer superior

levels of yield at lower levels of risks. With the aim of controlling risks rigorous indepth credit evaluation of the securities proposed to be invested in will be carriedout by the investment team of the AMC. The credit evaluation includes a study

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of the operating environment of the issuer , the past track record as well as thefuture prospects of the issuer, the short as well as longer term financial health ofthe issuer. Rated debt instruments in which the Scheme invests will be ofinvestment grade as rated by a credit rating agency. The AMC will be guided bythe ratings of Rating Agencies such as CRISIL, CARE, ICRA and Duff and PhelpsCredit Rating India Limited or any other agency approved by SEBI for this purpose.In case a debt instrument is not rated, specific approval of the Boards of the AMCand Trustee will be obtained for such an investment.In addition, the investment team of the AMC will study the macro economicconditions, including the political, economic environment and factors affectingliquidity and interest rates. The AMC would use this analysis to attempt to predictthe likely direction of interest rates and position the portfolio appropriately to takeadvantage of the same.

ii) Equities : For the equity portion of the corpus, the AMC intends to invest in stocks,which are bought, typically, with a one-year time horizon. Stock specific risk willbe minimized by investing only in those companies that have been thoroughlyanalyzed by the Fund Management team at the AMC. The AMC will also monitorand control maximum exposure to any one stock or one sector.The Scheme may also use various derivatives and hedging products from time totime, as would be available and permitted by SEBI, in an attempt to protect thevalue of the portfolio and enhance Unitholders’ interest.The Scheme may invest in other schemes managed by the AMC or in the schemesof any other Mutual Funds, provided it is in conformity with the investmentobjectives of the Scheme and in terms of the prevailing Regulations. As per theRegulations, no investment management fees will be charged for such investments.For the present, the Scheme does not intend to enter into underwriting obligations.However, if the Scheme does enter into an underwriting agreement, it would doso after complying with the Regulations and with the prior approval of the Boardof the AMC/Trustee.

Portfolio TurnoverPortfolio turnover is defined as the aggregate of purchases and sales as a percentage ofthe corpus of the Scheme during a specified period of time. The AMC’s portfoliomanagement style is conducive to a low portfolio turnover rate. However, the AMC willtake advantage of the opportunities that present themselves from time to time becauseof the inefficiencies in the securities markets. A high portfolio turnover rate in the equitycomponent of the portfolio may represent arbitrage opportunities that exist for scripsheld in the portfolio. The AMC will endeavour to balance the increased cost on accountof higher portfolio turnover with the benefits derived therefrom.Investment plans and options available under the Prudential ICICI MonthlyIncome PlanUnder the Scheme, Investors may choose either the Cumulative Option or the DividendOption.(i) Cumulative Option

The Scheme will not declare any dividends under this option. The income earnedby the Scheme will remain invested in the Scheme and will be reflected in theNet Asset Value. This option is suitable for investors who are not looking for regularincome. If Units under this option are redeemed after they have been held as acapital asset for a period of at least one year from the date of acquisition,Unitholders will get benefit of long term capital gains tax.

(ii) Dividend OptionThis option is suitable for investors seeking income through monthly/quarterly/halfyearly dividend distributions proposed to be made by the Scheme. The Trusteemay approve the distribution of dividend by AMC out of the net surplus underthis Option. The remaining net surplus after considering the dividend and tax, ifany, payable there on will be ploughed back in the Scheme and be reflected inthe NAV.It is the intention of the Trustee to distribute the dividends at monthly/quarterly/half yearly rests. It should, however, be noted that actualdistribution of dividends and the frequency of distribution as indicatedabove are provisional and will depend, inter-alia, on the availability ofdistributable surplus and will be entirely at the discretion of the Trustee.

(iii) Automatic Encashment PlanThis Plan is available only to the Unitholders who have opted for Cumulative Optionunder the Scheme. The Plan envisages an automatic redemption and payment tothe Unitholders. Unitholders under this Plan can opt for monthly/quarterly/half-yearly redemptions depending on their cash flow requirements and providestanding instructions to the AMC. On receipt of such instructions, the AMC willredeem, at the specified intervals, a part of the unitholdings of the investor anddispatch the redemption cheques. The amount to be redeemed at monthly,quarterly, half-yearly rests will be equivalent to the amount of dividend (andDividend tax) that the Fund will be paying under Dividend Option under respectiveplans. The redemptions of Units not being in the nature of dividend payments,the Fund is not required to pay dividend tax on such redemptions being made tothe Unitholders. Unitholders should note that if Units are redeemed before theyhave been held as a capital asset for a period of less than one year from the dateof acquisition, there may be an incidence of short term capital gains tax. Theinvestors are advised to consult their tax advisors as to the exact nature of taxliability and applicable tax provisions in this regard.For automatically encashed units, the exit load will not be applicable.In case of Unitholders opting for Automatic Encashment Plan at Monthly/Quarterlyrests the Fund will provide them with the Transaction Confirmation Statements

once in a quarter indicating therein the transactions with the Fund during thequarter to which the statement relates to.In addition to the automatic encashment, the Unitholders, if they so desire andto meet their cash requirements, may also seek further redemption of theirinvestments under the Scheme. Such redemptions will be governed by the normalprocedures as described in para on“Redemption of Units” on page 15, subject toapplicable load. If Units are redeemed after they have been held as a capital assetfor a period of at least one year from the date of acquisition, Unitholders will getbenefit of long term capital gains tax. Please refer to “Right to Limit Redemptions”and “Suspension of Sale and Redemption of Units” on page 16.

Risk Factors and Special Considerations:• Investing in the Scheme involves certain risks and considerations associated generally

with making investments in securities. There can be no assurance that the Schemewill achieve its objectives. The value of the Scheme’s investments may be affectedby factors affecting capital market generally, such as price and volume volatility inthe fixed income and stock markets, interest rates, currency exchange rates, foreigninvestment, changes in government policy, taxation, political, economic or otherdevelopments and closure of the stock exchanges. Consequently, the Net Asset Valueof the Scheme may fluctuate, and the value of the Scheme’s Units may go up ordown. Past performance of mutual funds managed by the Sponsor and its affiliatesis not necessarily indicative of future performance of the Scheme. There can be noassurance that the Scheme’s investment objectives will be achieved.

• As per the Regulations, the Scheme may invest up to 5% of its net assets in unlistedequity and equity-related securities. The Scheme’s investments in such unlisted equitiesmay be realisable only upon listing of these securities.

Prudential ICICI Balanced FundINVESTMENT PATTERN

Type of Security Approximate Maximum Minimum Risk Profile(% of Corpus) under Allocation of Allocation ofnormal circumstances. the corpus the corpusEquities & Equityrelated securities 60% 80% 51% Medium to highDebt securities & MoneyMarket instruments &Cash (including - moneyat call) 40% 49% 20% Low to medium

The asset allocation pattern indicated above may change from time to time, keeping inview market conditions, market opportunities, applicable regulations and political andeconomic factors. It must be clearly understood that the percentages stated above areonly indicative and not absolute and that they can vary subject to the Regulations andguidelines, depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unitholders. Such changes inthe investment pattern will be for short term and defensive considerations.INVESTMENT STRATEGYThe Scheme proposes to invest in a mix of equities and fixed income securitieswith the aim of generating capital appreciation, while at the same time minimiz-ing the volatility inherent in pure equity schemes. With this aim the InvestmentManager will allocate the assets of the Scheme between equity and fixed incomesecurities within the limits mentioned in the table above. The actual percentageof investment in equities and fixed income securities will be decided afterconsidering the prevailing political conditions, the economic environment (includ-ing interest rates and inflation), the performance of the corporate sector, theequity markets and general liquidity and other considerations in the economy andmarkets.Stock pickingThe AMC believes in a bottom-up approach to stock picking. This means that thefocus is on the fundamental quality of companies as opposed to a focus onfavoured sectors and market movements.The AMC will follow a structured investment process in order to identify the beststocks for inclusion in the portfolio. This would involve consistently examining allstocks under an internally developed research framework, which focuses on thefollowing key factors:* Management quality, strategy and vision; * Business dynamics; * Financialstrength of the company; * Free cash flow generation; * Returns on capitalemployed and returns on equity; * Intangible assets such as brands, distributionetc.; * Valuation in relation to the history of the stock as well as its peer group.A stock would be considered for inclusion in the portfolio when the valuationdoes not adequately capture its underlying fundamental value in our opinionbased on the above factors.Fixed Income: The AMC aims to identify securities, which offer superior levelsof yield at lower levels of risks. With the aim of controlling risks, rigorous indepth credit evaluation of the securities proposed to be invested in will be carriedout by the investment team of the AMC. The credit evaluation includes a studyof the operating environment of the company, the past track record as well asthe future prospects of the issuer, the short as well as longer term financialhealth of the issuer. Rated Debt instruments in which the Scheme invests will beof investment grade as rated by a credit rating agency. The AMC will be guidedby the ratings of Rating Agencies such as CRISIL, CARE, ICRA and Duff andPhelps Credit Rating India Limited. In case a debt instrument is not rated, specificapproval of the Board of AMC will be obtained for such an investment.


9

Investment options available under the Prudential ICICI Balanced FundInvestors under the Prudential ICICI Balanced Fund have the choice of a Growth option,a Dividend option or a Dividend Reinvestment option. There will be two separate NAVs,one for the Growth option and one for the Dividend option. Please see page 11 fordetails.Risk Factors and Special Considerations

• The Scheme, under normal circumstances, proposes to invest about 60% of its corpusin equity and equity related securities and about 40% in debt and money marketsecurities. Trading volumes, settlement periods and transfer procedures may restrictthe liquidity of these investments. Different segments of the Indian financial marketshave different settlement periods and such periods may be extended significantly byunforeseen circumstances. The inability of the Scheme to make intended securitiespurchases due to settlement problems could cause the Scheme to miss certaininvestment opportunities. By the same rationale, the inability to sell securities heldin the Scheme’s portfolio due to the absence of a well developed and liquid secondarymarket for debt securities would result, at times, in potential losses to the Scheme,in case of a subsequent decline in the value of securities held in the Scheme’sportfolio.

• As the liquidity of the Scheme’s investments could, at times, be restricted by tradingvolumes and settlement periods, the time taken by the Fund for redemption of Unitsmay be significant in the event of an inordinately large number of redemption requestsor of a restructuring of the Scheme’s portfolio. In view of this, the Trustee has theright, in its sole discretion to limit redemptions (including suspending redemption)under certain circumstances, as described on page 16 under the section titled “Rightto Limit Redemptions”.

Prudential ICICI Growth PlanINVESTMENT PATTERN

Type Approx. Allocation

Equity & Equity related securities 95%Debt, Money Market securities & Cash(including money at call) 5%

Subject to the Regulations, the asset allocation pattern indicated above may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages stated above are only indicative and not absolute and that they can varysubstantially depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unitholders. Such changes inthe investment pattern will be for short term and defensive considerations.INVESTMENT STRATEGYA value approach to stock picking will be the dominant theme in stock selection for theScheme. The AMC in selecting scrips will focus on the fundamentals of the business,the industry structure, the quality of management, sensitivity to economic factors, thefinancial strength of the company and the key earnings drivers.Risk will be reduced through adequate diversification of the portfolio. For a corpus sizeof upto Rs.100 crores, the AMC intends to invest in about 20-30 scrips. Diversificationwill also be achieved by spreading the investments over a diverse range of industries/sectors. The Scheme, under most market conditions does not intend investing in illiquidequity and equity related securities. The Scheme may however, invest in unlisted and/orprivately placed and/or unrated debt securities subject to the limits indicated above, fromissuers of repute and sound financial standing. If investment is made in unrated debtsecurities, the approval of the Board of the AMC shall be obtained, as per the Regulations.Subject to the limits indicated above for investment in debt securities and money marketinstruments, the Fund may invest a part of the portfolio in securities issued and/orguaranteed by State and Central Governments. The Fund may also invest in Securitiesof issuers supported by Government of India or State Governments subject to suchsecurities satisfying the criteria relating to rating etc. Please refer to “Right to LimitRedemptions” and “Suspension of Sale and Redemption of Units” on page 16.Portfolio Turnover: The portfolio turnover shall generally not exceed 75% per year,once the entire corpus is invested.

INVESTMENT OPTIONS AVAILABLE UNDER THE PRUDENTIAL ICICI GROWTH PLANInvestors under the Prudential ICICI Growth Plan have the choice of a Growth option, aDividend option or a Dividend Reinvestment option. There will be two separate NAVs,one for the Growth option and one for the Dividend option. Please see page 11 fordetails.Risk Factors and Special ConsiderationsTrading volumes, settlement periods and transfer procedures may restrict the liquidity ofthese investments. The inability of the Scheme to make intended securities purchasesdue to settlement problems could cause the Scheme to miss certain investmentopportunities. By the same rationale, the inability to sell securities held in the Scheme’sportfolio due to the absence of a well developed and liquid secondary market for debtsecurities would result, at times, in potential losses to the Scheme, in case of a subsequentdecline in the value of securities held in the Scheme’s portfolio. As the liquidity of theScheme’s investments could, at times, be restricted by trading volumes and settlementperiods, the time taken by the Fund for redemption of Units may be significant in theevent of an inordinately large number of redemption requests or of a restructuring ofthe Scheme’s portfolio. In view of this, the Trustee has the right, in its sole discretion tolimit redemptions (including suspending redemption) under certain circumstances.

Prudential ICICI Tax PlanThe scheme is an equity linked savings scheme under Section 88(2) clause (xiiib) ofIncome-tax Act, 1961. The investments under the scheme have a lock in of 3 years forthe date of each allotment. Investors are entitled for tax benefits under the scheme asper the provisions of Sec. 88(2)(xiiib) of Income Tax Act, 1961.INVESTMENT PATTERN

Type of security Approximate Risk ProfileAllocation

(% of Corpus)

Equities & Equity related securities 90% Medium to highDebt securities & Money Marketinstruments & Cash (including –money at call) 10% Low to medium

Subject to the Regulations and the guidelines governing the Equity Linked SavingSchemes, the asset allocation pattern indicated above may change from time to time,keeping in view market conditions, market opportunities, applicable regulations andpolitical and economic factors. It must be clearly understood that the percentages statedabove are only indicative and not absolute and that they can vary subject to theRegulations and guidelines, depending upon the perception of the Investment Manager,the intention being at all times to seek to protect the interests of the Unitholders. Suchchanges in the investment pattern will be for short term and defensive considerations.INVESTMENT STRATEGYThe AMC believes that equities outperform all other asset classes in the long run. It furtherbelieves that anomalies exist in the valuation of stocks and that consistently appliedfundamental research can identify these opportunities. The AMC will follow an activeinvestment style supported by in-house research. External research will be used whenevernecessary.The AMC in selecting scrips will focus on the fundamentals of the business, the industrystructure, the quality of management, sensitivity to economic factors, the financialstrength of the company and the key earnings drivers.Since investing requires disciplined risk management, the AMC would incorporateadequate safeguards for controlling risks in the portfolio construction process. Stockspecific risk will be minimized by investing only in those companies that have beenthoroughly analyzed by the Fund Management team at the AMC. The AMC will alsomonitor and control maximum exposures to any one security.Risk will also be reduced through adequate diversification of the portfolio. For a corpussize of upto Rs.100 crores, the AMC intends to invest in about 20-30 scrips. Diversificationwill also be achieved by spreading the investments over a diverse range of industries/sectors. The Scheme, under most market conditions does not intend investing in illiquidequity and equity related securities. Please refer to “Right to Limit Redemptions” and“Suspension of Sale and Redemption of Units” on page 16.Investment options available under the Prudential ICICI Tax PlanInvestors under the Prudential ICICI Tax Plan have the choice of a Growth option, aDividend option or a Dividend Reinvestment option. There will be two separate NAVs,one for the Growth option and one for the Dividend option. Please see page 11 fordetails.Risk Factors and Special ConsiderationsPlease refer to Risk Factors on Page 6.

Prudential ICICI FMCG FundINVESTMENT PATTERN

Type of security Approximate Risk ProfileAllocation

(% of Corpus)

Equities & Equity related 90% Medium to highsecurities of select groupof FMCG companies

Debt and money market securities 10% Low to medium

Subject to the Regulations, the asset allocation pattern indicated above may changefrom time to time, keeping in view market conditions, market opportunities, applicableregulations and political and economic factors. It must be clearly understood that thepercentages stated above are only indicative and not absolute and that they can varysubstantially depending upon the perception of the Investment Manager, the intentionbeing at all times to seek to protect the interests of the Unit holders. Such changes inthe investment pattern will be for short term and defensive considerations.

INVESTMENT STRATEGYThe Fast Moving Consumer Goods MarketFast Moving Consumer Goods (FMCG) are products that are typically purchased and used/consumed on a regular basis or at frequent intervals. Typical examples of such productsare soaps, detergents, toothpastes, shampoos, safety razors, atta, rice, chocolates etc.The market potential for Fast Moving Consumer Goods in India is large given that Indiahas the 2nd largest population in the world. Currently, consumption of branded fast mov-ing consumer goods is low in Indian households, due to prevailing low levels of per capitaincome.

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The following data illustrates the levels of consumption in developed economies and Indiaduring 1997-98, of some FMCG products. The developed economies’ per capita con-sumption levels are many times the consumption levels in the Indian economy, indicatingthe growth potential for these products in India.

Product India Developed Economies

Soaps 0.4 kgs 1.7 kgsDetergent 2.7 kgs 9.7 kgsToothpaste 51 ml 277 mlHair-care 11 g 767 gIce-cream 0.1 litre 5.7 litres

Source : Probity, CLSA, (1997-98)Long term growth in the Indian economy leading to an increase in household per capitaincome, along with favourable shifts in the demographic profile in terms of income andage distribution, will lead to increased penetration and per capita consumption of fastmoving consumer goods. At the same time, the existing FMCG products are largely shieldedfrom economic downturns, given that most of these products are daily necessities. Ac-cordingly, the industry exhibits ideal characteristics in terms of growth prospects as well aslow macro economic risks.New entrants face entry barriers in terms of establishing a new brand and setting up adistribution system. Therefore existing players face less risk of competition in the industry.The industry predominantly consists of multinational companies operating for a long timein the country, having established brands and well entrenched distribution networks. Suchcompanies typically have very strong balance sheets with low leverage, good amount ofcash and cash equivalents, and low proportion of investments in non-core assets. Thecompanies show high returns on investment in absolute terms as well as compared toother industries.Two key segments of the Indian FMCG sector that are expected to be the most significantgrowth areas are (i) Personal Care and (ii) Processed Foods.Investment options available under the Prudential ICICI FMCG FundInvestors under the Prudential ICICI FMCG Fund have the choice of a Growth option, aDividend option or a Dividend Reinvestment option. Please refer to page 11 for detailsof these options. There will be two separate NAVs, one for the Growth option and onefor the Dividend option. Please refer to “Right to Limit Redemptions” and “Suspensionof Sale and Redemption of Units” on page 16.Risk Factors and Special Considerations• The Scheme proposes to invest substantially in equity and equity related securities.

The Scheme will, to a lesser extent, also invest in debt and money market securities.Trading volumes, settlement periods and transfer procedures may restrict the liquidityof these investments. Different segments of the Indian financial markets have differentsettlement periods and such periods may be extended significantly by unforeseencircumstances. The inability of the Scheme to make intended securities purchasesdue to settlement problems could cause the Scheme to miss certain investmentopportunities. By the same rationale, the inability to sell securities held in the Scheme’sportfolio due to the absence of a well developed and liquid secondary market fordebt securities would result, at times, in potential losses to the Scheme, in case of asubsequent decline in the value of securities held in the Scheme’s portfolio.

• The Scheme’s investments will be predominantly in equities of a select group ofcompanies in the FMCG Sector. The AMC will be broadly guided, among otherfactors, while investing the corpus of the Scheme, by the market capitalization ofcompanies. Accordingly, the NAV of the Scheme is linked to the equity performanceof such companies.

Prudential ICICI Technology FundINVESTMENT PATTERN

Sr. Type of Security Approximate Risk ProfileNo. Allocation

(% of Corpus)under normalcircumstances

1 Equities & Equity related 90-95% Medium to highsecurities

2 Debt securities & Money 5-10% Low to mediumMarket instruments & Cash(including – money at call)

The asset allocation pattern indicated above may change from time to time, keeping inview market conditions, market opportunities, applicable regulations and political andeconomic factors. It must be clearly understood that the percentages stated above areonly indicative and not absolute and that they can vary substantially depending uponthe perception of the Investment Manager, the intention being at all times to seek toprotect the interests of the Unitholders. Such changes in the investment pattern will befor short term and defensive considerations.

INVESTMENT STRATEGYThe Indian economy has been changing rapidly over the last few years and is today verydifferent to what it has been in the past what was primarily an agrarian economy todayit has over two thirds of its GDP generated from industry and services. The process ofreforms set off in the early 1990s has meant a greater integration of India into the globaleconomy. Falling trade barriers, greater flow of human resources and capital and theboom in satellite television and the Internet has brought the world much closer. Thereare many far-reaching changes taking place in the characteristics of the global economy.

The industrial age was characterized by physical assets and manufacturing assets. Todaywe are on the fringes of what may be described as a “New Economy”, which would bevery different from the industrial age that it succeeds. This “New Economy” has ideas,innovation and marketing as its key characteristics. The engines of growth in this eraare likely to be information technology, communication, media and life sciences, as againstthe manufacturing sector, which was the engine of growth in the industrial era. Theunderlying theme is that these sectors are all driven by technology.What does this mean for India and to Indian markets?These changes precipitated by technology have already begun to manifest themselvesall over the world as well as in India. Today “technology intensive” sectors account for45% of the capitalization of the S&P 500 and is estimated to increase further. Closerhome, the market capitalisation of the “technology intensive” sectors have increasedfrom 14.1% to 29.5%, between October 1996 and October 1999 in the S&P CNX 500.During this period, the broad market (as measured by the S&P CNX 500) has grown at15.7% p.a.. As against this, the “technology intensive” sectors have grown by 39.1%p.a. over this period. If these sectors are excluded from the market, then the market hasgrown by only 10.2% p.a. Importantly, the fundamental performance of these sectorshas been very good, exceeding that of the broader market.The Technology Fund proposes to invest in the “technology intensive” sectors, whichwill be at the forefront of the “New Economy”. These include, but are not limited to:• Hardware (including computers, peripherals, components)• Software (including project management, application software and education)• I T enabled services (including transaction processing, call centers, etc.)• Internet and E-commerce related companies.• Telecommunications (both service providers as well as equipment manufacturers)• Media (including programming, service providers and equipment manufacturers)• Convergence and networking technologies• Life sciences (including pharmaceutical, healthcare and health management services,

agrochemical and agri inputs services)• Research & Development companies and laboratories.The Investment Manager would have the option to decide the sectoral allocations,depending upon the relative attractiveness of sectors from time to time. Given beloware details on some of the major sectors that the Technology Fund could invest in.Information Technology (IT) sector: The IT sector is currently the largest sector in thetechnology universe. Over the last 5 years, the IT industry which comprises hardware(including peripherals and networking), software including project management,application software education and networking has witnessed impressive growth rates.Software exports which comprise 44% of the industry revenues have clearly been thefastest growing segment (48% over the last 5 years) and currently hold the maximumpotential for the Indian industry. The reasons for the phenomenal growth rates forsoftware exports include cost-effectiveness, world class quality, high reliability and rapiddelivery, all powered by state of the art technologies. One of the competitive advantagesthat India has is the fact that the country has the second largest pool of scientificmanpower, which is English speaking, of the highest quality and which is economical.During 1998-99, more than 200 of the Fortune 1000 companies (viz. one in fivecompanies), outsourced a part of their requirements of IT services from Indian companies.Eighty eight percent of India’s software exports go to the advanced and highly discerningmarkets of North America, Europe and Japan. Despite the growth rates of the past theshare of the Indian industry in the global software market is less than 2%. Given thesignificant advantages of the local software industry, the AMC believes that the growthin the software industry is all set to continue into the future.The growth of the industry in the past is reflected in the phenomenal growth in themarket cap of the software sector. The market cap of the software sector has increasedfrom Rs.3010 crores as of April 1, 1995 to Rs. 81,064 crores as of September 30, 1999,viz. a growth rate of 106% p.a.Life Sciences sector: The life sciences sector involves the application of technology andother innovations for prevention of disease, as well as to crop protection and developmentof seeds. The current consumption of medicines in India is very low at $ 3 per capita v/s$ 180 per capita in the USA. We believe that with the increasing per capita income aswell as with greater awareness, this may increase substantially. Probably, the greatestpositive factor for the Indian life sciences industry is the fact that it has demonstratedthe ability to deliver research based molecules and thereby survive and grow in the “NewEconomy”. This too has been reflected in the performance of the sector on the stockmarket.Telecom and the Media Sectors: The telecom sector is the backbone of the “NewEconomy”. This includes both wired as well as wireless communications. Importantly, astechnology develops, the lines between different communication media are gettingincreasingly blurred. We can expect the computer, the telephone, and the television tosoon “converge”. We expect this sector to have a great relevance in the “New Economy”.Portfolio Turnover: Portfolio Turnover is defined as the aggregate of purchases andsales as a percentage of the corpus of the Scheme during a specified period of time.The portfolio turnover shall generally not exceed 100 % per year, once the entire corpusis invested and excluding the portfolio turnover caused on account of fresh inflows intothe Scheme and money placed on Call Deposits. This is, however, indicative and maychange keeping in mind the circumstances and Unitholders’ interest.INVESTMENT OPTIONS AVAILABLE UNDER THE PRUDENTIAL ICICI TECHNOLOGYFUNDInvestors under the Prudential ICICI Technology Fund have the choice of a Growth option,a Dividend option or a Dividend Reinvestment option. There will be two separate NAVs,one for the Growth option and one for the Dividend option. Please refer to page 11 fordetails.Risk Factors and Special Considerationsl• Technology industries’ key asset is offen the personnel who run the business i.e.


11

intellectual properties of the key employees of the respective companies. Given theever-changing complexion of the technology sector and the high obsolescence levels,availability of qualified, trained and motivated personnel is very critical for the successof industries in the said sector. It is, therefore, necessary to attract key personneland also to retain them to meet the changing environment and challenges the sectoroffers. Failure or inability to attract/retain such qualified key personnel may impactthe prospects of the companies in the technology sector in which the Fund invests.

• Changes in Government policy especially in regard to the tax benefits applicable tothe technology sector may impact the business prospects of the companies in thissector.

• A number of companies in the technology sector generate revenues in foreigncurrencies and may have investments or expenses also denominated in foreigncurrencies. Changes in exchange rates may, therefore, have a positive or negativeimpact on companies in the said sector.

• The Scheme’s investments will be predominantly in equities of select companies intechnology intensive sectors. Accordingly, the NAV of the Scheme is linked to theequity performance of such companies and may be more volatile than a morediversified portfolio of equities.

Inter-Scheme InvestmentsThe schemes offered in this Abridged Offer Document may invest in other schemesmanaged by the AMC or in the Schemes of any other Mutual Funds, provided suchinvestment is in conformity with the investment objectives of the Scheme and in termsof the prevailing Regulations. As per the Regulations, no investment management feeswill be charged for such investments. As per Regulations, the Inter Scheme Investmentsshall not exceed 5% of the Net Asset Value of the Mutual Fund.Policy on investment by the AMC and affiliatesFrom time to time and subject to the Regulations, the Sponsors, the Mutual Fund andinvestment companies managed by them, their affiliates, their associate companies,subsidiaries of the Sponsors, and the AMC may invest either directly or indirectly in anyor all the Schemes. The funds managed by these affiliates, associates, the Sponsors,subsidiaries of the Sponsors and /or the AMC may acquire a substantial portion of theSchemes’ Units and collectively constitute a major investor in the Schemes. Accordingly,redemption of Units held by such funds, affiliates/associates and Sponsors may have anadverse impact on the Units of the Schemes because the timing of such redemptionmay impact the ability of other Unitholders to redeem their Units. As per the Regulations,in case the AMC invests in any of the Schemes managed by it, it shall not be entitled tocharge any fees on such investments.

Options and Plans available under all theSchemesGrowth Option: The Schemes will not declare any dividends under this option. Theincome earned by the Scheme will remain reinvested in the Scheme and will be reflectedin the Net Asset Value.Dividend Option (Except Liquid Plan): The Trustee may approve the distribution ofdividend by AMC as per the frequency, half yearly or yearly, out of the net surplus underthis Option. The remaining net surplus after considering the dividend and tax, if any,payable there on will be ploughed back in the Scheme and be reflected in the NAV.As per the Finance Act 1999, any income received from a mutual fund specified underclause (23D) of section 10 of Income Tax Act, 1961 is exempt from tax. This amendmentwill apply in relation to the Assessment Year 2000-2001 and the subsequent years. Theincome distributed by the Fund after April 1,1999 will, accordingly, be exempt fromincome tax in the hands of the recipient under the above provisions.As per the provisions of the Chapter XII E and the newly inserted Section 115 R, theincome distributed to the Unitholders of a mutual fund shall be charged to tax at a flatrate of 10% (subject to applicable surcharge, if any) payable by the mutual fund. As perthe provisions of Finance Bill 2000 (subject to enactment) the rate of tax is proposed tobe increased to 20% (plus applicable surcharge) from 10%. This provision is expectedto come into force w.e.f. June 1, 2000. However, tax under this section shall not bechargeable in respect of any income distributed to the unitholders of any open endedequity oriented scheme for a period of three financial years commencing from April 1,1999.

Dividend Reinvestment (Except Liquid Plan): The investors opting for Dividend Optionmay choose to reinvest the dividend to be received by them in additional Units of theScheme. Under this provision, the dividend due and payable to the Unitholders will becompulsorily and without any further act by the Unitholders reinvested in the Scheme(under the Dividend Option, at the first ex-dividend NAV). The dividends so reinvestedshall be constructive payment of dividends to the Unitholders and constructive receiptof the same amount from each Unitholder, for reinvestment in Units.On reinvestment of dividends, the number of units to the credit of Unitholder will increaseto the extent of the dividend reinvested divided by the NAV applicable on the day ofreinvestment as explained above. There shall, however, be no entry load on the dividendsso reinvested. AMC has been advised by the Tax consultants to the Fund that suchdividends, which are reinvested, will be tax exempt in the hands of the Unitholders.

Dividend Reinvestment Option for Liquid PlanIn the case of Liquid Plan, the Trustees may approve the distribution of dividend by theAMC on a weekly basis out of the net surplus in this option. Dividends under the LiquidPlan will be compulsorily reinvested in the Liquid Plan – Dividend Option at a price basedon the first ex-dividend NAV. The dividend so reinvested shall be constructive paymentof dividend to unitholders and constructive receipt of the same amount from eachunitholder for reinvestment in units.

The investors should note that NAV of Dividend Option and Growth Option willbe different.

Flexible Lifetime Investment Programme: The ability to switch part or all of a Unitholder’s investments between the open ended schemes offered by the Fund is animportant feature of this offer. Investors may choose to alter the allocation of theirinvestment among the schemes in order to meet their changed investment needs, riskprofiles or changing circumstances during their lifetime. A Unit holder, is therefore, ableto tailor his / her investment to his / her specific situation.

Regulatory Limits on Annual Recurring Expenses and Investment Manage-ment and Advisory Fees: As per the Regulations, the total annual recurringexpenses, including investment management and advisory fees that may becharged to the Scheme shall be subject to the limit of :

As a % of Average Net Assets (Rs. in crores)

First Rs. 100 Next Rs. 300 Next Rs. 300 Balance AssetsEquity Oriented Funds 2.50% 2.25% 2.00% 1.75%Debt Oriented Funds 2.25% 2.00% 1.75% 1.50%

Expenses over and above the permitted limits will be borne by the AMC.

As per the Regulations, the AMC is allowed to charge an investment management andadvisory fee upto 1.25% of the weekly net assets for the Scheme as long as the netassets of the Scheme do not exceed Rs. 100 crores. The AMC is allowed to charge amanagement fee of upto 1% p.a. of the average net assets of over Rs. 100 crores. Therecurring expenses of the Scheme shall not exceed the limit prescribed, under Sub-Regulation (6) of Regulation 52 of the Regulations.

Initial Issue Expenses

For the past Schemes: In June 1998, the Fund had launched three open-ended Schemesviz. Prudential ICICI Liquid Plan, Prudential ICICI Income Plan and Prudential ICICIGrowth Plan under a single Offer Document. The total amount mobilised in the InitialOffer Period (IOP) under all the three Schemes was Rs.173 crores and the total InitialIssue Expenses incurred were 1.94% of the amount mobilised during the IOP. Theentire expenses relating to the launch of the above Schemes were borne by the AMC.The fourth open ended Scheme, Prudential ICICI FMCG Fund launched in February1999 mobilised Rs.71.60 crores and the Initial Issue Expenses incurred were 2.45% ofthe amount mobilised in the IOP. However, the expenses charged to the fund werelimited to 1% of the subscriptions received during IOP. The Fund has launchedPrudential ICICI Tax Plan and Prudential ICICI Gilt Fund on July 9, 1999 and July 21,1999 respectively. The Gilt Fund mobilized Rs.150.01 crores in the IOP and Initial IssueExpenses incurred were 0.18% of the amount mobilized. The entire Initial IssueExpenses under the Scheme were borne by AMC. The Tax Plan collected Rs.50.76crores and the Initial Issue Expenses incurred were 1.43% of the amount mobilized.The initial issue expenses charged to the investors under Tax Plan were limited to 1%of the initial amount mobilised. The Fund launched Prudential ICICI Balanced Fundon September 20, 1999 and collected Rs.197.58 crores during the IOP. The initial issueexpenses incurred were 1.47% of the amount mobilized during the IOP. The Fundlaunched Prudential ICICI Technology Fund in January 2000 and mobilised Rs.509 croresand the Initial Issue Expenses incurred were 1.80% of the amount mobilised in theIOP. However, the expenses charged to the fund were limited to 1.75% of thesubscriptions received during IOP. The Fund has launched Prudential ICICI MonthlyIncome Plan in September 2000 and mobilised Rs. 48.67 crores during the IOP. Theinitial issue expenses incurred were 1.82% of the amount mobilised during the IPO.The entire expenses under the said plan were borne by the AMC.a. Condensed Financial Information for the year ended March 31, 1998.

Premier PowerHistorical Per Unit StatisticsDate of Allotment February 7, 1994 October 1, 1994NAV at the beginning of the year (Rs.) 6.22 6.93Net Income per unit 0.17 0.11Dividends - -Transfer to Reserves - -Compounded Annualised Returns(since inception excluding dividends, if any) -5.11% -6.89%Net Assets at the end of year (Rs.crore) 110.18 49.86NAV at the end of the year 7.35 7.79Ratio of Recurring Exps to Net Assets 2.49% 2.50%

b. Condensed Financial Information for the year ended March 31, 1999 :Premier Power Growth Income Liquid

Historical Per UnitStatistics

Date of Allotment Feb 7, 94 Oct 1, 94 Jul 9, 98 Jul 9, 98 Jun 24, 98NAV at the beginningof the year (Rs.) 7.99 8.49 ** ** **Net Income per unit 4.39# 0.29 0.94 0.84 0.73Dividends - - - - -Transfer to Reserves - - - - -

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Premier Power Growth Income Liquid

CompoundedAnnualised Returns(since inceptionexcluding dividends,if any, in the openended Schemes) -0.95% -1.27% 45.7%* 12.53%* 9.64%*Net Assets at theend of year (Rs. crore) 50.27 58.98 114.00 411.60 79.89NAV at the end ofthe year 8.75 9.44 14.57 10.91 10.7394Ratio of RecurringExps to Net Assets 2.41% 2.48% 2.50% 1.75% 0.93%

** These Schemes were launched in June 1998 and were not in existence at the beginning of the year.# Net Income per unit of Rs.4.39 was arrived at on the reduced unit capital outstanding as of March

31, 1999, consequent to the roll-over of the scheme during the year 1998-99. The adjusted net incomeper unit if the redeemed units (consequent to the roll-over) were to be considered, would be at Rs.1.71.

* As of March 31, 1999, Prudential ICICI Growth Plan has not completed one year since the date of itslaunch. Returns are, therefore, computed in absolute terms. Prudential ICICI Income Plan and PrudentialICICI Liquid Plan have not completed one year since the date of their launch. Returns are computedin annualized terms.

c. Condensed Financial Information for the period ended March 31, 2000.

Premier Power Growth Income Liquid FMCG

Historical PerUnit Statistics

Date of Allotment Feb 7, Oct 1, Jul 9, Jul 9, Jun 24, Mar 31,1994 1994 1998 1998 1998 1999

NAV at thebeginning of theyear (Rs.) 8.70 9.41 14.45 10.93 10.7523 10.28Net Income per unit 3.13 26.98 14.30 1.63 1.3503 1.13Dividends - - 11.80 2.13@ - 1.00Transfer to Reserves - - - - - -CompoundedAnnualisedReturns (sinceinception excludingdividends, if any,in the open endedSchemes) 4.79% 15.08% 98.20% 13.46% 9.68% 12.26%Net Assets end ofperiod (Rs.crore) 70.779 75.189 629.989 1753.351 152.674 87.733NAV at the endof the periodGrowth Option 12.34 21.66 32.63 12.44 11.7758 11.23Dividend Option - - 18.96 10.19 - 10.25Ratio of RecurringExps to Net Assets 1.90% 2.34% 2.36% 1.67% 0.98% 2.00%

Tax Plan Gilt Gilt Balanced TechnologyTreasury Investment Fund Fund

Historical Per Unit StatisticsDate of Allotment Aug 19, 99 Aug 19, 99 Aug 19, 99 Nov 03, 99 Mar 3, 00NAV at the beginning of theyear (Rs.) ** ** ** ** **Net Income per unit 8.71 0.7172 0.8883 0.70 -0.68Dividends 6.00 0.5717@ 0.6938@ 1.00 -Transfer to Reserves - - - - -CompoundedAnnualised Returns(since inception,excluding dividends,if any, in the openended Schemes) 114.90%* 13.75%* 16.45%* 35.50%* -6.80%*Net Assets end ofperiod (Rs.crore) 104.852 167.265 183.622 495.544 491.233NAV at the end ofthe periodGrowth Option 21.49 10.8474 11.0141 13.55 9.32Dividend Option 15.62 10.2603 10.3192 12.56 9.32Ratio of RecurringExps to Net Assets 2.00% 1.00% 1.00% 2.25% 2.30%

** These Schemes were launched during the year and were not in existence at the beginning of theyear.

* Prudential ICICI Tax Plan, Prudential ICICI Balanced Fund and Prudential ICICI Technology Fund havenot completed one year since the date of their launch. Returns are computed in absolute terms andfor Growth Options only from the date of allotment. The NAV on the date of allotment is taken asRs.10 for computation of returns. Prudential ICICI Gilt Fund – Treasury Option and Prudential ICICIGilt Fund- Investment Option have not completed one year since the date of launch. Returns arecomputed in annualized terms and for Growth Option only from the date of allotment. The NAV onthe date of allotment is taken as Rs.10 for computation purposes.

@ Including distribution tax.Note :• Net Income per unit of Rs. 26.98 for Power was arrived at on the reduced unit capital outstanding as

of March 31st 2000. Closing units as on 31st March 2000 are 3,47,12,000.d. Condensed Financial Information for the period ended November 30, 2000**.

Premier Power Growth Income Liquid FMCG

Historical PerUnit Statistics

Date of Allotment Feb. 7, Oct. 1, Jul. 9, Jul. 9, Jun. 24, Mar. 31,1994 1994 1998 1998 1998 1999

NAV at the beginningof the year (Rs.)

Growth Option 11.93 20.48 31.14 12.54 11.7855 11.28Dividend Option - - 18.10 10.26 11.7855 10.29

Net Income per unit (0.37) (4.06) (4.13) 0.75 0.49 (0.70)Dividends - - - 0.4270@ 0.6891@ -Transfer to Reserves - - - - - -CompoundedAnnualised Returns(since inceptionexcluding dividends,if any, in the openended Schemes) 1.67% 4.56% 37.47% 12.10% 9.72% – 0.14%Net Assets end ofperiod (Rs.crore) 59.08 44.71 430.49 1811.24 1,062.67 78.00NAV at the end ofthe period

Growth Option 10.30 13.17 21.45 13.15 12.5391 9.98Dividend Option - - 12.50 10.33 11.8261 9.15

Ratio of RecurringExps to Net Assets 2.50% 2.50% 2.26% 1.64% 0.98% 2.00%

Tax Plan Gilt Gilt Balanced Techno- MonthlyTreasury Invest- Fund logy Income

ment Fund PlanHistorical PerUnit StatisticsDate of Allotment August August August November March November

19, 1999 19, 1999 19, 1999 03, 1999 3, 2000 10, 2000NAV at thebeginning ofthe year (Rs.)

Growth Option 20.10 10.9598 11.1684 12.92 8.74 #Dividend Option 14.61 10.3667 10.4637 11.98 8.74 #

Net Income per unit (3.86) 1.08 0.55 (1.83) (3.59) 0.13Dividends - 0.7113@ 0.4026@ - - -Transfer to Reserves - - - - - -CompoundedAnnualisedReturns (sinceinception, excludingdividends,if any,in the open endedSchemes) 17.64% 11.77% 12.23% -5.25% -47.50%* 1.61%*Net Assets end ofperiod (Rs.crore) 63.15 102.27 183.67 335.27 299.15 50.58NAV at the endof the period

Growth Option 12.32 11.5377 11.5976 9.44 5.25 10.161Dividend Option 8.97 10.1817 10.4501 8.72 5.25 10.161

Ratio of RecurringExps to Net Assets 2.00% 1.00% 1.00% 2.25% 2.32% 2.00%

Notes:1. The figures for Monthly Income Plan are for the period from the date of opening of the scheme.2. Returns since inception are for the growth plan in each case.3. Net income for ICICI Power is on balance units after the redemption of ICICI Limited (Units redeemed -

22,484,300).4. From current year, while arriving at Net Income per unit, Income Equalisation Reserve has not been considered.


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* Prudential ICICI Technology Fund and Prudential ICICI Monthly Income Plan have not completed one yearsince the date of their launch. Returns are computed in absolute terms and for Growth Options only fromthe date of allotment. The NAV on the date of allotment is taken as Rs.10 for computation of returns.

** Unaudited.@ Including distribution tax.# This Scheme was launched during the year and was not in existence at the beginning of the year.

CONSTITUTION OF THE MUTUAL FUNDICICI Mutual Fund, which has been renamed as Prudential ICICI Mutual Fund (“the MutualFund” or “the Fund”) has been constituted as a Trust in accordance with the provisionsof the Indian Trusts Act, 1882 (2 of 1882). The Mutual Fund was registered with SEBIon October 13, 1993. ICICI Mutual Fund was established by ICICI, by execution of aTrust Deed dated August 25, 1993. Prudential plc, through its wholly owned subsidiary,Prudential Corporation Holdings Limited, contributed an amount of Rs.12.2 lacs to thecorpus of the Fund. SEBI has approved the change in name of the Fund to PrudentialICICI Mutual Fund vide its letter IIMARP / 88 / 98 dated April 16, 1998. A deed ofamendment to the Trust Deed dated August 25, 1993 was executed and registered onMay 14, 1998.a) SponsorsPrudential plc (formerly known as Prudential Corporation plc)Founded in 1848, Prudential plc is one of the largest life insurance companies in theUnited Kingdom and one of the leading life insurance companies in the world.Prudential is a global player in the medium to long-term savings market and has apresence in over 15 countries. Prudential is no stranger to Asia. It has over 75 yearsof experience in the region and has operations in Singapore, Hong Kong, Malaysia,Indonesia, Thailand, Taiwan, Vietnam and Philippines. Recently, it has signed amemorandum of understanding (MOU) with China International Trust & InvestmentCorporation (CITIC) to form a life insurance joint venture partnership in China.Prudential has over 19,000 staff and agents and over a million customers in Asia.Prudential manages the savings of over 10 million investors worldwide and its productscater to the diverse risk profiles and needs of a cross section of investors. Prudentialhas significant experience in product development, distribution through varied andmultiple channels and investment management of a diverse portfolio of assets includingequity, fixed income, real estate and other investments. Prudential as of June 30, 2000had over US$ 231 billion (Rs.10,62,600 crores approx.) of assets under management.Given below is a brief summary of Prudential’s financials:

Year ended December 31 (Rs. crores)Description For the 1999 1998 1997 1996 1995

half yearended

June 30,2000

Total Income 58,409 98,832 75,962 68,900* 72,735 53,911Profit Before Tax 4,160 5,025 7,873 5,818 5,675 5,226Profit After Tax 3,107 3,631 6,072 4,186 4,251 3,549Shareholders’ Funds 25,864 22,941 22,418 18,090 17,920 11,356Earnings per share (Rs.) 15.93 18.63 31.25 21.70 22.17 18.66

*Excluding discontinued operations

ICICI Limited (formerly, The Industrial Credit and Investment Corporation of India Limited)(ICICI)ICICI is a diversified term lending institution founded on January 5, 1955 through theinitiative of the Government of India, World Bank and representatives of Indian industry.The principal business of ICICI is to provide industry with medium to long term projectfinance, leasing and other financial services. Since inception, ICICI has financed all majorsectors of the economy, covering 6928 companies and 17,284 projects. As of September30, 2000 it has disbursed a total of over Rs.128,443 crores since inception. Over theyears, ICICI has developed an expertise in appraising and monitoring projects across thecross section of industry. ICICI has a consistent track record of profitable operations.Given below is a brief summary of ICICI’s financials:

Description For the 2000 1999 1998 1997 1996 1995 half year

endedSep. 30,

2000

Total Income 4,333 8,459 7,323 5,736 4,471 2,901 2,364Profit Before Tax 590 1,328 1,096 1,023 856 508 455Profit After Tax* 541 1,206 1,001 936 752 436 390Profit After Tax (includingnon recurring gain) 541 1,206 1,001 1,081 752 436 390Free Reserves 7,774 7,239 4,655 4,192 3,900 2,059 1,809Net Worth 8,227 7,677 4,816 4,365 4,084 2,302 2,094Earnings per Share **(Rs.) 13.60# 17.00 18.20 18.20 15.90 13.00 13.90Book Value per Share (Rs.) 105 98.00 100.30 91.30 85.90 76.40 69.50Dividend % – 55% 55% 55% 45% 37% 35%Paid Up Capital (Equity) 785 783 480 478 476 301 301

(Preference) 350 1,308 1,383 635 75 75 –

*Excludes adjustments for changes in accounting policy**Diluted for conversion of domestic convertible bonds in 1999# Annualised

b) The Trustee Company (The Trustee)

PRUDENTIAL ICICI TRUST LIMITEDPrudential ICICI Trust Limited (The Trustee), a company incorporated under the CompaniesAct, 1956 is the Trustee to the Fund vide Trust Deed dated August 25, 1993 as amendedfrom time to time. Prudential plc, through its wholly owned subsidiary, PrudentialCorporation Holdings Limited, U.K. holds 55% of the shares of the Trustee and ICICIholds the balance 45%.

The Directors of the Trustee Company are:

1. Mr. Natesan Vaidheeswaran Iyer(S/o. Mr. Chinnaswamy Natesan Iyer)73, Jupiter Apartments, 41, Cuffe Parade, Mumbai 400 005Chartered AccountantPartner of C.C. Chokshi & Co., Mumbai, C.C. Chokshi & Co., Ahmedabad, C.C.Chokshi & Co., Vadodara, Deloitte Haskins & Sells, Mumbai, Deloitte Haskins &Sells (National Firm), Mumbai, Deloitte Haskins & Sells, Ahmedabad, DeloitteHaskins & Sells, Vadodara, Deloitte Haskins & Sells, New Delhi, Deloitte Haskins &Sells, Calcutta, Touche Ross & Co., Chennai, Touche Ross & Co., Mumbai, ToucheRoss & Co., Ahmedabad, Touche Ross & Co., Vadodara, S.B. Billimoria & Co.,Mumbai.Director of Cadbury India Ltd., Mumbai, The Statesman Ltd., Calcutta, CCCServices Co.Pvt.Ltd., Mumbai (Chairman), Deloitte Touche Tohmatsu India Pvt Ltd.,Mumbai, Deloitte Touche Tohmatsu (Global Board), NSE.IT Limited, Mumbai.

2. Mr. Vishnu Bhagwandas Haribhakti(S/o. Late Mr. Bhagwandas Haribhakti)Flat No.51, 5th Floor, Maker Tower ‘B’, Cuffe Parade, Mumbai 400 005Chartered AccountantPartner of Haribhakti & Co., Mumbai, V.B. Haribhakti Associates, Mumbai,Haribhakti Shah & Co., Ahmedabad, V.B. Haribhakti & Co., New Delhi, V.B.Haribhakti & Co., Chennai, V.B. Haribhakti & Co., Bangalore, V.B. Haribhakti &Co., Jodhpur, V.B. Haribhakti & Co., Bhubaneshwar, V.B. Haribhakti & Co., Calcutta.Director of Bajaj Electricals Ltd, Rohit Pulp and Paper Mills Company Ltd., TheSimplex Mills Company Ltd., The Anglo-French Drug Co.(Eastern) Ltd., EsterIndustries Ltd., Lakshmi Automatic Loom Works Ltd., Tilaknagar Industries Ltd.,Hindustan Composites Ltd., Haribhakti Financial Services Pvt. Ltd., Moores RowlandConsulting Pvt. Ltd.Trustee of Rotary International, Dist. 314, Welfare Fund, The Pransukhlal MafatlalHindu Swimming Bath and Boat Club Trust, V.B. Haribhakti Charitable Trust, IndianMerchants’ Chamber Platinum Jubilee Endowment Trust.Member of Indian Merchants Chamber, The Associated Chambers of Commerceand Industry of India.

3. Mr. Eruch B. Desai(S/o. Mr. Byramsha Desai)81, Sonarica, 33-A, Pedder Road, Mumbai 400 026Solicitor and AdvocatePartner of Mulla & Mulla & Craigie Blunt & CaroeDirector of Birla Global Finance Ltd., Blow Plast Ltd., Bekaert Industries Pvt.Ltd.,Ceat Financial Services Ltd., The Century Textiles & Industries Ltd., The DeccanFlour Mills Ltd., Dolphin Fisheries & Trading Pvt.Ltd., Essar Oil Ltd., Ferro AlloysCorporation Ltd., Hercules Hoists Ltd. (Alternate director), Hindalco Industries Ltd.,Ispat Metallics India Ltd., Kanoria Industries Ltd., Lakhanpal National Ltd., NewAge International Private Ltd., National Panasonic India Ltd., The SandurManganese & Iron Ores Ltd., Siltap Chemicals Ltd., Uni Abex Alloy Products Ltd.,Widia (India) Ltd. (Alternate)

4. Mr. Rajendra A. Shah(S/o. Mr. Ambalal Shah)Panorama, 2nd Floor, 203, Walkeshwar Road, Mumbai 400 006Solicitor & AdvocatePartner of Crawford Bayley & CompanyChairman & Alternate Director of Abott Lab. (I) Ltd., Fulford India Ltd., IndianGum Industries Ltd., Cyanamid Agro Ltd.Chairman of Godfrey Phillips India Ltd., Modicare Limited, Pfizer Limited, RocheScientific Company (I) Pvt. Ltd., Smithkline Beecham Pharmaceuticals (India) Ltd.Vice Chairman of Colgate Palmolive India LtdDirector of The Atul Products Ltd., The Bombay Dyeing & Mfg. Co. Ltd., BASFIndia Ltd., Colour Chem Ltd., Deepak Fertilizers & Petrochemicals Corporation Ltd.,Knoll Pharmaceuticals Ltd., Knoll International Ltd., Mather & Platt India Ltd.,Nicholas Piramal India Ltd., Procter & Gamble Hygienic and Healthcare Ltd., PhilipsIndia Ltd., Searle India Ltd., W.D. Consumer Products Pvt. Ltd.Alternate Director of Baron International Ltd., Bush Boake Allen (I) Ltd., BASFIndustries Ltd., Century Enka Ltd., Clariant (India) Ltd., Indabrator Ltd., RhonePoulenc India Ltd., Schrader Duncan Ltd., Uhde India Ltd., Wockhardt Ltd.Committee Member of Indo German Chamber of Commerce, Bombay Chamberof Commerce

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5. Mr. Shashikant Harilal Bhojani*(S/o. Mr. Harilal Bhojani)P-1, 13th Floor, Radhika Apartments, Off Sayani Road, Opposite Ravindra NatyaMandir, Prabhadevi, Mumbai 400 025.Company ExecutiveDirector of ICICI Ltd., ICICI Personal Financial Services Ltd., ICICI Infotech ServicesLtd., ICICI Securities and Finance Co. Ltd., ICICI Home Finance Co. Ltd., ICICIVenture Funds Management Co. Ltd., ICICI Web Trade Services Ltd., ICICI PrudentialLife Insurance Co. Ltd., ICICI Lombard General Insurance Company Limited.Chairman of ICICI Trusteeship Services Ltd.Trustee of The Kandivili Education SocietyMember of Member of Advisory Board of The Institute of Company Secretariesof India

6. Mr. Sham P. Subhedar*(S/o. Mr. Pandharinath Subhedar)1, Gulmohar, S.V. Road, Vile Parle (W), Mumbai 400 056ConsultantSenior Advisor of Prudential Corporation Asia Ltd.Director of Peter Pan Travels Pvt. Ltd., SAS Office Services Pvt. Ltd.Alternate DirectorICICI Prudential Life Insurance Company Ltd.

* Mr. S. H. Bhojani is the Deputy Managing Director of ICICI Ltd.* Mr. S.P. Subhedar is a Senior Advisor to the Prudential Corporation Asia Limited,

a wholly owned subsidiary of Prudential plc.

Summary of Substantial provisions of the Trust Deed

The substantial provisions of Trust Deed are laid down in the Offer Document of theScheme. The following are some of the salient aspects:

1. The Trustee shall ensure before the launch of any scheme that the AssetManagement Company has :-

(i) systems in place for its back office, dealing room and accounting;(ii) appointed all key personnel including fund manager(s) for the scheme(s)and submitted to the Trustee their bio-data which shall contain the educa-tional qualifications, past experience in the securities market within fifteendays of their appointment; (iii) appointed auditors to audit the accounts ofthe schemes; (iv) appointed a compliance officer to comply with regulatoryrequirements and to redress investor grievances; (v) appointed registrars andlaid down parameters for their supervision; (vi) prepared a compliance manualand designed internal control mechanisms including internal audit systemsand (vii) Specified norms for empanelment of brokers and marketing agents.

2. The Trustee is required to ensure that the AMC has not given any undue orunfair advantage to any associate or dealt with any of the associates of theAMC in any manner detrimental to the interests of the Unitholders.

3. The Trustee is required to obtain the consent of the Unitholders of a Scheme:(a) When the Trustee is required to do so by SEBI in the interest of theUnitholders of that Scheme; or (b) Upon the requisition of three-fourths ofthe Unitholders of any Scheme under the Fund for that Scheme; or (c) If amajority of the Trustees decide to wind up the Scheme or prematurely redeemthe Units; or (d) When a change in the fundamental attributes of the Schemeor the Trust or fees and expenses payable or any other change which wouldmodify the Scheme or affect the interest of the Unitholders is proposed to becarried out. No change shall be carried out unless not less than three fourthsof the Unitholders have given their consent and the Unitholders who do notgive their consent are allowed to redeem their holdings in that Scheme.

Please read the Offer Document for further details.

Trusteeship Fees : Pursuant to the Deed of Trust constituting the Fund, the Fund isauthorized to pay the Trustee a fee for its services in such capacity of a sum, presentlycomputed at the rate of upto 0.05% of the amount, being the aggregate of the TrustFund and Unit Capital of all the Schemes put together on April 1 of each year or a sumof Rs.5 lacs, whichever is higher.

MANAGEMENT OF THE AMC

Prudential ICICI Asset Management Company Limited (AMC) (formerly known asICICI Asset Management Company Limited), has been appointed as the AssetManagement Company of Prudential ICICI Mutual Fund vide Investment Manage-ment Agreement dated September 3, 1993. The AMC currently manages nineschemes, seven of which are open-ended and two are closed-ended. Theaggregate assets under management by the AMC are over Rs.3,000 crores as onDecember 31, 1999.

Board of Directors of the AMC

Mr. Kundapur V. Kamath- Mr. Kamath is the Managing Director and CEO ofICICI Limited.

Mr. Mark E. Tucker - Mr. Mark Tucker is a Director on the Board of Prudentialplc. and is the CEO of Prudential Corporation Asia, a wholly-owned subsidiary ofPrudential plc.

Mrs. Lalita D. Gupte - Mrs. Gupte is the Joint Managing Director and ChiefOperating Officer of ICICI Ltd.

Mr. Derek Stott - Mr Derek Stott works with Prudential Corporation Asia withspecial responsibilities relating to India.

Mr. K. S. Mehta - Mr. K. S. Mehta is a senior Partner at S.S Kothari & Co.,Chartered Accountants, New Delhi.

Mr. N. Ganga Ram - Mr. Ganga Ram is a Development Banker and a formerExecutive Director of IDBI.

Mr. Dadi Engineer - Mr. Engineer is a senior partner of Crawford Bayley & Co.,Solicitors and Advocates.

Mr. B. R. Gupta - Mr. B. R. Gupta is the former Executive Director of LIC andcurrently consultant (Investment) to GIC.

Mr. Pradip Shah - Mr. Pradip Shah is the Chairman of Ind Asia Fund AdvisorsPvt. Ltd.

Mr. Ajay Srinivasan - Mr. Srinivasan is the Managing Director of Prudential ICICIAsset Management Company Ltd.

COMPLIANCE OFFICER: Mrs. Abhaya Joglekar, Asst. Company Secretary, ContractorBuilding, 3rd Floor, 41, R. Kamani Marg, Ballard Estate, Mumbai 400 038.

INVESTOR RELATIONS OFFICER: Mr. Gautam Guha, Contractor Building, 3rd Floor, 41,R. Kamani Marg, Ballard Estate, Mumbai - 400 038. Tel: 2679676/ 2697989.

AUDITORS: N. M. Raiji & Co., Chartered Accountants, Mumbai have been appointedas Auditors of the Scheme by the Trustee.

REGISTRAR: Computer Age Management Services Limited (CAMS), “Gems Foundation”,383 Anna Salai, Saidapet, Chennai 600 015 are the Registrar for the Scheme. TheRegistrar is registered with SEBI under registration No: INR000002813. As Registrars tothe Scheme, CAMS will handle communications with investors, perform data entryservices and dispatch Account Statements. The AMC and the Trustee have satisfiedthemselves that the Registrar can provide the services required and has adequate facilitiesand the system capabilities.

CUSTODIAN: HDFC Bank is the custodian for the Scheme. Their address is HDFC BankLimited, Sandoz House, Dr. Annie Besant Road, Worli, Mumbai - 400 018. The Custodianhas been registered with SEBI and has been awarded registration number IN/CUS/001dated February 2, 1998. The Custodian will be responsible for safe custody of thesecurities and carrying out activities related to corporate actions. The Custodian will beentitled to remuneration for its services in accordance with the terms of the CustodianAgreement.

Key Employees of the AMC and relevant experienceEmployee Designation Qualifications Experience

Mr. H. Shriram Sr. Vice President – PGDM (IIM, Over 19 years ofOperations Ahmedabad), experience in the

AICWA, LL.B (G), areas of operations,B.Com. Finance and Technology.

Mr. M. Lakshman Kumar Sr. Vice President – MBA (Finance), Over 18 years ofFinance & CAIIB, ACS, experience in finance,Compliance and M.Com operations andCompany Secretary. compliance

Mr. Dileep Madgavkar Chief Investment Associate of Institute Over 13 years ofOfficer of Chartered experience in

Accountants, treasury and fundB.Com (Hons.) management(Cal. Univ.)

Mr. Suraj Mishra Vice President & MBA (University of Over 11 years ofHead – Marketing District of Columbia), experience in

B.Com. (Hons.) marketing, sales anddistribution

Mr. Pankaj Razdan Vice President & B.Tech. Over 9 years ofHead – Sales and experience in salesDistribution and distribution of

financial servicesMr. Vasant Sanzgiri Vice President & MMS; DSQM; B.Sc. Over 14 years

Head – Human experience in area ofResources Human Resources

Management

UNITS AND OFFER

Who can Invest?The following persons are eligible and may apply for subscription to the Units of theSchemes (subject, wherever relevant, to purchase of units of Mutual Funds beingpermitted under respective constitutions and relevant statutory regulations):• Resident adult individuals either singly or jointly (not exceeding three)• Minor through parent/lawful guardian• Companies, Bodies Corporate, Public Sector Undertakings, association of persons

or bodies of individuals and societies registered under the Societies RegistrationAct, 1860 (so long as the purchase of units is permitted under the respectiveconstitutions)

• Religious and Charitable Trusts under the provisions of 11(5)(xii) of Income-tax Act,1961 read with Rule 17C of Income-Tax Rules, 1962

• Partnership Firms• Karta of Hindu Undivided Family (HUF)• Banks & Financial Institutions• Non-resident Indians/Persons of Indian origin (except in Tax Plan) residing abroad

(NRIs) on full repatriation basis or on non repatriation basis.


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• Overseas Corporate Bodies, firms and societies which are held directly or indirectlybut ultimately to the extent of at least 60% by NRIs and trusts in which at least60% of the beneficial interest is similarly held irrevocably by such persons (OCBs),on full repatriation basis.

• Foreign Institutional Investors (FIIs) registered with SEBI on full repatriation basis(Except in the Tax Plan)

• Army, Air Force, Navy and other para-military funds• Scientific and Industrial Research Organizations• Mutual fund Schemes

Investments made in Tax Plan by Resident Adult Individuals and Kartas of HinduUndivided Families only will qualify for Tax Benefits under Section 88.

How to apply?: Application Forms will be available from Customer ServiceCenters, at the corporate office of the AMC and the office of the Registrar.Applications complete in all respects, may be submitted at the Customer ServiceCenters. The Trustee shall have absolute discretion to accept/reject any applica-tion for purchase of Units, if in the opinion of the Trustee, increasing the size ofScheme’s Unit capital is not in the general interest of the Unitholders, or theTrustee for any other reason believes it would be in the best interest of theSchemes or its Unitholders to accept/reject such an application.

Kindly retain the acknowledgment slip initialled/stamped by the collectingauthority.

Mode of Payment for Resident Indians: Investors may make payments forsubscription to the Units of Scheme by local cheque/bank draft, drawn on anybank branch which is a member of Bankers clearing house located in the centrewhere the application is lodged. Cheques/demand drafts should be drawn infavour of “Prudential ICICI Liquid Plan” or “Prudential ICICI Income Plan –Dividend Option” or “Prudential ICICI Income Plan – Growth Option” or“Prudential ICICI Gilt Fund – Treasury Plan” or “Prudential ICICI Gilt Fund– Investment Plan” or “Prudential ICICI Balanced Fund” or “Prudential ICICIGrowth Plan” or “Prudential ICICI Tax Plan” or “Prudential ICICI FMCGFund” or “Prudential ICICI Technology Fund” or “Prudential ICICI MonthlyIncome Plan” and must be crossed “Account Payee Only”. Cash will not beaccepted.

Mode of Payment for NRIs: Investors may make payments for subscription tothe Units of the Scheme by cheque/bank draft, drawn on any bank branch whichis a member of Bankers Clearing House located in the centre where theapplication is lodged.

Applications from OCBs should be accompanied with OAC/OAC1 from anOverseas Auditor/Chartered Accountant/Certified Public Accountant. Such certifi-cate should be sent to the Registrars at Chennai, so as to reach them not laterthan fifteen days of the date of submission of application.

Application under Power of Attorney/Body corporate/Registered society/Trust/ Partnership: In case of an application under Power of Attorney or by alimited company, body corporate, registered society, trust or partnership, etc., therelevant Power of Attorney or the relevant resolution or authority to make theapplication as the case may be, or duly certified copy thereof, along with thememorandum and articles of association/bye-laws must be lodged at the Regis-trars Office within 3 days from the date of close of the Initial Offer Period.

Joint Applicants: In the event an Account has more than one registered owner,the first-named holder (as determined by reference to the original ApplicationForm) shall receive the Account Statement, all notices and correspondence withrespect to the Account, as well as the proceeds of any redemption requests ordividends or other distributions. In addition, such Unitholders shall have thevoting rights, as permitted, associated with such Units, as per the applicableguidelines. Applicants can specify the ‘mode of holding’ in the application formas ‘Jointly’ or ‘Anyone or Survivor’. In the case of holding specified as ‘Jointly’,redemptions and all other requests relating to monetary transactions would haveto be signed by all joint holders. However, in cases of holding specified ‘Anyoneor Survivor’, any one of the Unitholders will have the power to make redemptionrequests, without it being necessary for all the Unitholders to sign. However, inall cases, the proceeds of the redemption will be paid to the first-named holder.Investors should note that all tax benefits applicable under the Scheme will onlybe available to the sole Unitholder or the first named holder.

Nomination Facility: The Schemes provide for the nomination facility. If anomination is made by a single /joint Unitholder(s) or a surviving Unitholder notbeing persons: (a) holding the Units as holder of an office; (b) acting for a trust;(c) acting in any other capacity for any other person with a beneficial interest inunits the same shall be recognised by the AMC. The nomination facility extendedunder the Scheme is subject to the “Rules and Regulations for nomination”. Thesingle/joint/surviving Unitholders can, at the time application is made or subse-quently by writing to the Registrar, request for a nomination form and the Rulesand Regulations governing the facility in order to nominate any person to receivethe Units upon his/her death subject to completion of necessary formalities.Payment to the nominee of the sums shall discharge the Fund of all liabilitytowards the estate of the deceased Unitholder and his/her successors/legal heirs.

Account Statements: An Account Statement will be sent by ordinary post to eachUnitholder, stating the number of Units allotted. The Account Statements shall be non-transferable. If the Unitholder so desires, non transferable unit certificates will be issuedwithin six weeks of the receipt of request for the certificate. Allotment of Units and

despatch of Account Statements to FIIs will be subject to RBI approval.

As per the directives issued by SEBI, it is mandatory for applicants tomention their bank account numbers in their applications for purchase orredemption of Units.

Redemption of Units

The Units can be redeemed (i.e., sold back to the Fund), at the Applicable NAV.

A Unitholder may request redemption of a specified amount or a specified number ofUnits, (subject to the minimum redemption amount) the number of Units specified willbe considered for deciding the redemption amount. If only the redemption amount isspecified by the Unitholder, the Fund will divide the redemption amount so specified bythe Applicable NAV based price to arrive at the number of Units.

In case an investor has purchased Units on more than one Business Day (either duringthe Initial Offer Period, or through subsequent purchases), the Units purchased prior intime (i.e. those Units which have been held for the longest period of time) will be deemedto have been redeemed first i.e. on a First-in-First-Out basis.

Unitholders may also request for redemption of their entire holding and close the accountby indicating the same at the appropriate place in the Redemption Request Form.

Investors should note that the amount invested under the 54EA and 54EBInvestment Plans will have to be locked-in for a period of 3 years and 7 years,respectively and the Units so allotted cannot be redeemed during the specifiedlock-in period. Similarly units allotted under the Scheme will have a lock-in of 3years from the date of allotment.

i) Redemption PriceThe Redemption Price of the Units will be based on the Applicable NAV.Investors may note that the Trustee has a right to prescribe or modify the loadstructure with prospective effect and to introduce an exit load or a combination ofentry and exit loads subject to the Regulations. Please refer to the section titled“Load”.

ii) Applicable NAVApplicable NAV is the Net Asset Value per Unit at the close of the Business Day onwhich the application is accepted. An application will be considered accepted onthat day, subject to it being complete in all respects and received prior to the cutofftime on that Business Day.

iii) How to Redeem?The redemption requests can be made on the transaction slip for redemption availableat the Customer Service Centres or the office of the Registrar. The redemption requestcan be made at any of the Customer Service Centres as listed in this Offer Document,or can be sent by mail to the Registrar, Computer Age Management Services Pvt.Ltd., “Gems Foundation”, 383 Anna Salai, Saidapet, Chennai 600 015. Tel.: (044)431 2121 / 2 / 3; Fax: (044) 431 2124.

In case the Units are standing in the names of more than one Unitholder, wheremode of holding is specified as ‘Jointly’, redemption requests will have to be signedby all joint holders. However, in cases of holding specified as ‘Anyone or Survivor’,any one of the Unit holders will have the power to make redemption requests,without it being necessary for all the Unit holders to sign. However, in all cases, theproceeds of the redemption will be paid only to the first-named holder.

The Unit holder may either request for mailing of the redemption proceeds to his/her address or collection of the same from the Customer Service Center.

iv) Payment of ProceedsAll redemption requests received prior to the cut-off time on any Business Day willbe considered accepted on that Business Day, subject to the redemption request beingcomplete in all respects, and will be priced on the basis of the Applicable NAV (subjectto the applicable load) for that day. Where an application is received after the cut-off time, as above, the request will be deemed to have been received on the nextBusiness Day. Please see ‘Right to Limit Redemption’ and ‘Suspension of Sale andRedemption of Units’.As per the Regulations, the Fund shall despatch the redemption proceeds within 10(ten) Business Days(working days) from the date of acceptance of redemption requestat any of the Customer Service Centres or the Office of the Registrar, in case of aredemption request being sent by post.As per the guidelines issued by SEBI, in the event of failure to dispatch the redemptionor repurchase proceeds with in 10 working days, the AMC is liable to pay interestto the Unit holders @ 15% p.a. or such other rate as may be notified by SEBI fromtime to time. SEBI has further advised the mutual funds that in the event of paymentof interest to the Unit holders, such Unit holders should be informed about the rateand the amount of interest paid to them.Under normal circumstances, the Fund will endeavour to despatch the redemptioncheques (within the time specified in the “Key Features” on page 2, 3, 4, & 5) fromthe date of acceptance of the redemption request. The redemption cheque will beissued in favour of the sole/first Unitholder’s registered name and bank accountnumber and will be sent to the registered address of the sole/first holder as indicatedin the original Application Form. The redemption cheque will be payable at par atall the places where the Customer Service Centres are located. The bank chargesfor collection of cheques at all other places will be borne by the Unitholder.As per the directives issued by SEBI, it is mandatory for applicants to mentiontheir bank account numbers in their applications for purchase or redemptionof Units.

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A fresh Transaction Confirmation will be sent by the Registrar to the redeeminginvestors, indicating the new balance to the credit in the Account.The Fund may close a Unitholder’s account if, as a consequence of redemption, thebalance falls below the minimum accounts size and a period of 30 (thirty) days haselapsed after the issue of notice to the Unitholder by the AMC requesting him tobring the amount to the minimum account size and the Unitholder fails to do so.If a Unitholder makes a redemption request immediately after purchase of Units,the Fund shall have a right to withhold the redemption request till sufficient timehas elapsed to ensure that the amount remitted by him (for purchase of Units) isrealized and the proceeds have been credited to the Scheme’s Account. However,this is only applicable if the value of redemption is such that some or all of the freshlypurchased Units may have to be redeemed to effect the full redemption.

v) Redemption by NRIs/OCBs/FIIsUnits held by an NRI/OCB investor and FIIs may be redeemed by such investor inaccordance with the procedure described above and subject to any procedures laiddown by RBI. Such redemption proceeds will be paid by means of a Rupee chequepayable to NRIs/OCBs/FIIs subject to RBI procedures and approvals, and subject todeduction of tax at source, as applicable.As mentioned above, in terms of Notification No FERA.195/99-RB dated March 30,1999 and FERA.212/99-RB dated October 18,1999, the RBI has now granted ageneral permission to mutual funds as referred to in Section 10(23D) of Income-taxAct, 1961 for repurchase of units of the schemes which are approved by SEBI, heldby NRIs/OCBs/FIIs.

vi) Effect of Redemptions

The Unit Capital and Reserves of the Scheme will stand reduced by an amountequivalent to the product of the number of Units redeemed and the Applicable NAVas on the date of redemption.

vii) Fractional Units

Since a request for redemption or purchase is generally made in Rupee amountsand not in terms of number of Units of the Scheme, an investor may be left withFractional Units. Fractional Units will be computed and accounted for up to threedecimal places. However, Fractional Units will in no way affect the investor’s abilityto redeem the Units, either in part or in full standing to the Unitholder’s credit.

viii) Right to Limit Redemptions

The Trustee may, in the general interest of the Unitholders of the Scheme offeredunder this Offer Document and keeping in view the unforeseen circumstances/unusualmarket conditions, limit the total number of Units which may be redeemed on anyBusiness Day to 5% of the total number of Units then in issue, or such otherpercentage as the Trustee may determine.

Any Units, which by virtue of these limitations are not redeemed on a particularBusiness Day, will be carried forward for redemption to the next Business Day, inorder of receipt. Redemptions so carried forward will be priced on the basis of theApplicable NAV (subject to the prevailing load) of the Business Day on whichredemption is made. Under such circumstances, to the extent multiple redemptionrequests are received at the same time on a single Business Day, redemptions willbe made on pro-rata basis, based on the size of each redemption request, the balanceamount being carried forward for redemption to the next Business Day(s).

ix) Suspension of Sale and Redemption of Units

The Trustee may decide to temporarily suspend determination of NAV of the Schemeoffered under this Document, and consequently sale and redemption of Units, inany of the following events:1. When one or more stock exchanges or markets, which provide basis for valuation

for a substantial portion of the assets of the Scheme are closed otherwise thanfor ordinary holidays.

2. When, as a result of political, economic or monetary events or any circumstancesoutside the control of the Trustee and the AMC, the disposal of the assets ofthe Scheme is not reasonable, or would not reasonably be practicable withoutbeing detrimental to the interests of the Unitholders.

3. In the event of breakdown in the means of communication used for the valuationof investments of the Scheme, without which the value of the securities of theScheme cannot be accurately calculated.

4. During periods of extreme volatility of markets, which in the opinion of the AMCare prejudicial to the interests of the Unitholders of the Scheme.

5. In case of natural calamities, strikes, riots and bandhs.6. In the event of any force, majeure or disaster that affects the normal functioning

of the AMC or the Registrar.7. If so directed by SEBI.In the above eventualities, the time limits indicated above, for processing of requestsfor purchase and redemption of Units will not be applicable.

Net Asset Value

NAV of Units under the Scheme shall be calculated as shown below :

Market or Fair Value of Scheme’s investments +Current Assets - Current Liabilities and Provision

NAV (Rs.) =No. of Units outstanding under Scheme

The NAV of the Scheme will be calculated as of the close of every Business Day.The valuation of the Scheme’s assets and calculation of the Scheme’s NAV shallbe subject to audit on an annual basis and such regulations as may be prescribedby SEBI from time to time.

Tax benefits of investing in the Mutual Fund

The following information is provided for only general information purposes. In view ofthe individual nature of tax benefits, each Investor is advised to consult with his or herown tax consultant with respect to the specific tax implications arising out of theirparticipation in the Plan.The Fund’s auditors, N. M. Raiji and Co. have confirmed that based on the law in force,the following benefits may accrue to the respective assesses:

I. To the Mutual FundThe entire income of the Fund is exempt from Income Tax in accordance with theprovisions of Section 10(23D) of the Income-tax Act, 1961. The income received bythe Fund is not liable for deduction of tax at source.Under section 115R, the Fund will be liable to pay additional income tax @ 20% plussurcharge, if any, on the income distributed by the Fund. However, the above distribu-tion tax will be exempted for a period of three years, commencing from Financial Year1999-2000 i.e. April 1, 1999 for open-ended Equity Oriented Funds (funds investingmore than 50% in equity or equity related instruments).

Explanation: Due to the above provision, Dividend distributed is tax-free in thehands of the investor, however prior to distributing Dividend the Mutual Fundwill pay to the Government dividend distribution tax of 20% (plus surcharge).Such charge will not form part of the annual recurring expense chargeable tothe scheme.

II. To the Unitholdersa. Income Tax :Under the provisions of section 10(33) of the Income tax Act, 1961, income received byall categories of Unitholders will be exempt from income tax in their hands. In view ofthis position no tax will be deducted at source from such distribution by the Fund.

b. Capital Gains Tax:

LONG TERM CAPITAL GAINS

i) For Individuals and HUFs :Long-term Capital Gains in respect of Units held for a period of more than 12 monthswill be chargeable under Section 112 of the Income-tax Act, 1961, at a rate of 20%plus surcharge, as applicable. Capital gains would be computed after taking intoaccount cost of acquisition as adjusted by Cost Inflation Index notified by the CentralGovernment and expenditure incurred wholly and exclusively in connection with suchtransfer.In case, where taxable income as reduced by long term capital gains is below theexemption limit, the long term capital gains will be reduced to the extent of theshortfall and only the balance long term capital gains will be charged at the flat rateof 20% plus surcharge, as may be applicable.Finance Act 2000 has provided that an assessee will have an option to applyconcessional rate of 10%, plus surcharge, provided the long term capital gains com-puted without substituting indexed cost in place of cost of acquisition.

ii) For Partnership Firms, Non-Residents and Indian Companies / Foreign Compa-nies :Long-term Capital Gains in respect of units held for a period of more than 12 monthswill be chargeable under Section 112 of the Income-tax Act, 1961, at a rate of 20%plus surcharge, as may be applicable. Capital gains would be computed after takinginto account cost of acquisition as adjusted by Cost Inflation Index notified by theCentral Government.Finance Act 2000 has provided that an assessee will have an option to applyconcessional rate of 10%, plus surcharge, as applicable, to long term capital gainscomputed without adjusting cost for indexation.No surcharge however is payable by a foreign company.

iii) For Non resident Indians:Under Section 115E of the Income-Tax Act, 1961, income by way of long term capitalgains in respect of units, is chargeable at the rate of 20%. Such gains would becalculated without indexation of cost of acquisition.Finance Act 2000 has levied surcharge on taxes computed as per section 115E.Non resident Indian may also opt for computation of long term capital gains as persection 112, which is more beneficial.

iv) For Overseas Financial Organisations / Foreign Institutional Investors / Over-seas Corporate Bodies fulfilling conditions laid down under section 115AB(Offshore Fund)Under section 115AB of the Income-Tax Act, 1961, long term capital gains in respectof units held for a period of more than 12 months will be chargeable at the rate of10% plus surcharge, as may be applicable. Such gains would be calculated withoutindexation of cost of acquisition.No surcharge is applicable for taxes under section 115AB, in respect of corporatebodies.


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Short Term Capital Gain:Short-term capital gain in respect of units held for a period of not more than 12 monthsis added to the total income. Total income including short-term capital gains is chargeableto tax as per the relevant slab of rates. The maximum tax rates applicable to differentcategories of assessee are as follows:

Resident individuals and HUF: 30% plus surcharge, as applicable.Partnership firms: 35% plus surcharge.Indian companies: 35% plus surcharge.Non-resident Indians: 30% plus surcharge.Foreign companies: 48% (no surcharge).

Tax deduction at source on Capital Gains:(i) No tax is required to be deducted at source on capital gains arising to any resident

unitholders (under section 194K) vide circular no. 715 dated August 8, 1995issued by the Central Board for Direct Taxes (CBDT).

(ii) Under section 195 of the Income-tax Act, 1961, tax shall be deducted at sourcein respect of capital gains as under:a. In case of non resident other than a company :-

* Long term Capital Gains 20% plus surcharge.* Short Term Capital Gains 30% plus surcharge.

b. In case of foreign company:-* Long term Capital Gains 20%.* Short Term Capital Gains 48%.

As per circular no. 728 dated October 1995 by CBDT, in the case of a remittance to acountry with which a double Taxation Avoidance Agreement (DTAA) is in force, the taxshould be deducted at the rate provided in the Finance Act of the relevant year or atthe rate provided in DTAA whichever is more beneficial to the assessee.

c. Wealth Tax:Units held under the Plan are not treated as assets within the meaning of Section 2(ea)of the Wealth Tax Act, 1957 and are therefore, not liable to Wealth-tax.

d. Gift Tax :Units of the Plan may be given as a gift and no gift tax will be payable either by thedonor or donee, as the Gift Tax Act has been abolished.

e. Exemption from tax on capital gains arising on transfer of units held formore than 12 months:

As provided under section 54EC of the Income-tax Act, 1961 where an assessee hasmade capital gains from the transfer of units held in the Plan for a period exceeding 12months and the assessee has any time within a period of 6 months after the date ofsuch transfer, invested the whole of the capital gains in the long term specified assetsi.e. in bonds redeemable after 3 years issued by the National Bank for Agriculture andRural Development, or by the National Highways Authority of India, such capital gainsshall be exempted from tax on capital gains under section 54EC of the Income-tax Act,1961. However, if the assessee has invested only a part of the capital gains, he will beeligible for the proportionate exemption.

f. Investments by charitable and religious trusts in the Plan:Units of the Plan referred to in clause 23D of section 10 of the Income-tax Act, 1961,constitute an eligible avenue for investment by charitable or religious trusts per rule17C of the Income Tax Rules, 1962, read with clause (xii) of sub-section (5) of section11 of the Income-tax Act, 1961.

UNITHOLDER GRIEVANCES REDRESSAL MECHANISM

Investor grievances are normally received at AMC office or at the Customer ServiceCentres or directly by the Registrar. All grievances are forwarded to the Registrar for theirnecessary action. The complaints are closely followed up with the Registrar to ensuretimely redressal and prompt investor service. Given below is the complaint history forthe last three fiscal years:

ICICI Premier ICICI Power

01/04/97 to 31/03/98Complaints/ Requests received during the year 6487 845Redressed during the year 6393 845Pending 94 001/04/98 to 31/3/99Complaints/ Requests received during the year 2467 574Redressed during the year 2441 574Pending 26 001/4/99 to 31/03/2000Complaints/ Requests received during the period 7649 2992Redressed during the period 7242 2992Pending 407 001/04/2000 to 30/11/2000Complaints/ Requests received during the period 3837 1388Redressed during the period 3795 1280Pending 42* 108*

* Received during the last week of November 2000 and has been redressed duringthe first week of December 2000.

The details relating to the seven open ended schemes launched by the Fund in June1998, February 1999, July 1999 and September 1999 are as under:

Data relating to the period June 1998 to November 2000

Plan Complaints Complaints ComplaintsReceived redressed pending

Growth Plan 334 334 NilIncome Plan 555 555 NilLiquid Plan 101 101 NilFMCG Fund 341 341 NilTax Plan 274 274 NilGilt Fund 60 60 NilBalanced Fund 356 356 NilTechnology Fund 1578 1578 Nil

Total 3599 3599 Nil

ASSOCIATE TRANSACTIONSInvestment in Group Companies : Details of investments made by the schemes insecurities of one of the Sponsors i.e. ICICI Ltd. during the previous three financial yearsare as follows:

(Amount in Rupees)Scheme name/Nature of April 1, 2000 1999-2000 1998-99 1997-98investment to November

30, 2000Amount

Investment in Bonds of ICICIICICI Premier 10,270,000 10,601,789 10,694,200 NilPrudential ICICI Income Plan 520,532,155 259,250,390 38,355,131 NilPrudential ICICI Balanced Fund 18,923,436 19,437,690 Nil NilPrudential ICICI Liquid Plan 185,257,482 Nil Nil NilPrudential ICICI MonthlyIncome Plan 51,350,000Investment in equityshares of ICICIICICI Power Nil 26,852,000 Nil NilICICI Premier Nil Nil Nil 9,950*Prudential ICICI Tax Plan Nil 21,207,600 Nil NilPrudential ICICI Growth Plan Nil Nil Nil NilPrudential ICICI Balanced Fund Nil Nil Nil NilTOTAL 786,333,073 337,349,469 49,049,331 9,950% to the net assets of theMutual Fund 1.73% 0.80% 0.59% 0.00062%* Market Value as on March 31, 1998.

Underwriting obligations with respect to issues of Associate Companies:The AMC has, till date, not entered into any underwriting contracts in respect of anypublic issue made by any of its associate companies.Subscription in issues lead managed by ICICI Securities & Finance CompanyLimited (I-Sec):

(Amount in Rupees)Name of the Till March 1998-99 1999-2000 April 1,Scheme 31, 1998 2000 to

Nov. 30,2000

ICICI Premier 241,100,000 - 20,000,000 NilICICI Power 135,400,000 - 14,308,000 NilPrudential ICICI Income Plan - - 850,000,000 500,000,000Prudential ICICI Liquid Plan - - 50,000,000 150,000,000Prudential ICICI Growth Plan - - 42,166,000 NilPrudential ICICI Tax Plan - - 11,300,400 NilPrudential ICICI Balanced Fund - - 107,074,000 50,000,000

TOTAL 376,500,000 - 1,094,848,400 700,000,000

The above investments were considered sound. Before making an investment, AMCevaluated the same on merits and on arms’ length basis and in accordance with theobjectives of the Scheme.

Transaction with Associate Companies (Amount in Rupees)1997-98 1998-99 1999-2000 2000-2001

Till Nov.30, 2000

ICICI Bank Limited – Bank ChargesICICI Premier 1,735 39,306 225 81,376ICICI Power 896 Nil 4,054 NilPrudential ICICI Income Plan Nil 373,109 734,769 533,164Prudential ICICI Liquid Plan Nil 264,462 661,365 593,476Prudential ICICI Growth Plan Nil 288,514 612,128 589,936Prudential ICICI FMCG Fund Nil Nil 451,138 486,546Prudential ICICI Tax Plan Nil Nil 240,300 522,741Prudential ICICI Gilt Fund – Treasury Nil Nil 251,375 505,464

ICICI Bank Limited – Bank ChargesPrudential ICICI Gilt Fund – Investment Nil Nil 246,799 505,692Prudential ICICI Balanced Fund Nil Nil 252,420 520,023Prudential ICICI Technology Fund Nil Nil Nil 509,488Prudential ICICI Monthly Income Plan Nil Nil Nil 100

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1997-98 1998-99 1999-2000 2000-2001Till Nov.30, 2000

ICICI Bank Limited – BrokeragePrudential ICICI Income Plan Nil Nil 2,480,252 4,759Prudential ICICI Liquid Plan Nil Nil 2,032 4,142Prudential ICICI Growth Plan Nil 1,121 385,832 54,015Prudential ICICI FMCG Fund Nil Nil 21,532 5,816Prudential ICICI Tax Plan Nil Nil 16,293 2,343Prudential ICICI Gilt Fund – Treasury Nil Nil 151 154Prudential ICICI Gilt Fund - Investment Nil Nil 449 353Prudential ICICI Balanced Fund Nil Nil 738,538 44,156Prudential ICICI Technology Fund Nil Nil 461,165 46,949Prudential ICICI Monthly Income Plan Nil Nil Nil 750

ICICI Infotech Services Limited –Service ChargesICICI Premier 581,253 159,495 Nil 195,437ICICI Power 174,747 29,505 Nil Nil

CICI Capital Services Limited –BrokerageICICI Premier Nil 6,381 Nil NilPrudential ICICI Income Plan Nil Nil 8,582,157 4,418,749Prudential ICICI Liquid Plan Nil Nil 642,493 1,051,206Prudential ICICI Growth Plan Nil 32,805 1,461,747 1,073,431Prudential ICICI FMCG Fund Nil Nil 191,451 54,032Prudential ICICI Tax Plan Nil Nil 1,196,280 51,724Prudential ICICI Gilt Fund – Treasury Nil Nil 36,042 185,407Prudential ICICI Gilt Fund - Investment Nil Nil 40,225 263,912Prudential ICICI Balanced Fund Nil Nil 978,556 489,726Prudential ICICI Technology Fund Nil Nil 4,854,512 1,198,518Prudential ICICI Monthly Income Plan Nil Nil Nil 65,778

ICICI Brokerage Services Limited –brokerage on secondary markettransactionsICICI Premier Nil Nil 3,425 89,098

ICICI Securities and Finance Co. Ltd.BrokeragePrudential ICICI Income Plan Nil Nil 11,073,162 8,086,276Prudential ICICI Liquid Plan Nil Nil 199,485 1,143,312Prudential ICICI Growth Plan Nil Nil 18,051,819 694,685Prudential ICICI FMCG Fund Nil Nil 398,987 11,278Prudential ICICI Gilt Fund – Treasury Nil Nil 652,634 207,256Prudential ICICI Gilt Fund - Investment Nil Nil 739,749 413,050Prudential ICICI Balanced Fund Nil Nil 8,177,865 1,230,158Prudential ICICI Technology Fund Nil Nil 4,194,879 219,878Prudential ICICI Tax Plan Nil Nil Nil 124Prudential ICICI Monthly Income Plan Nil Nil Nil 1,278

The percentage of brokerage paid to ICICI Brokerage Services Limited was upto 0.25%of transaction value and the same was in line with the norms relating to brokeragepayments for secondary market transactions of the Fund. The total business given tothe said broker amounted to Rs.14.098 lakhs and Rs. 452.98 lakhs during the year1999-2000 and 2000-2001 respectively. Further, the above broker was paid a sum ofRs. 305,650 in connection with the roll-over of ICICI Premier Scheme towards servicecharges, in the year 1998-99.Dealings with Associate Companies: The AMC may, from time to time, for thepurpose of conducting its normal business, use the services of the subsidiaries andother associate companies of its Sponsors. The group companies/subsidiaries of ICICIas on the date of this Offer Document include ICICI Personal Financial Services Limited,a non-banking finance company; ICICI Bank Limited, a commercial bank; ICICI InfotechServices Limited, a software company and registrar and transfer agent; ICICI BrokerageServices Limited, a brokerage house, ICICI Capital Services Limited, a securities placementand marketing company, ICICI Venture Funds Management Company Limited, a venturefunds management company, ICICI Home Finance Company Limited, a housing financecompany, ICICI Securities and Finance Company Limited (I Sec), an investment bank,ICICI Prudential Life Insurance Co. Limited for carrying out insurance business and ICICIWeb Trade Limited. The AMC may utilize the services of the group companies and anyother subsidiary or associate company of the Sponsors established or to be establishedat a later date in case such an associate company is in a position to provide the requisiteservices to the AMC. The AMC will conduct its business with the aforesaid companieson commercial terms and on arms’ length basis and at the then prevailing marketprices to the extent permitted under the applicable laws including the Regulations,after an evaluation of the competitiveness of the pricing offered by the associatecompanies and the services to be provided by them.BORROWING BY THE MUTUAL FUND: Under the Regulations, the Fund is allowed toborrow to meet its temporary liquidity needs of the Fund for the purpose of repurchase,redemption of units or payment of interest or dividend to the Unitholders. Further, asper the Regulations, the Fund shall not borrow more than 20% of the Net Assets of theScheme and the duration of such borrowing shall not exceed a period of six months.The Fund may raise such borrowings after approval by the Trustee from any of itsSponsors/Associate/Group Companies/Commercial Banks in India or any other entity atmarket related rates prevailing at the time and applicable to similar borrowings. Thesecurity for such borrowings, if required, will be as determined by the Trustee. Suchborrowings, if raised, may result in a cost which would be dealt with in consultationwith the Trustees.

No borrowings have been raised under any of the Schemes of the Fund, as of the dateof this Offer Document.STOCK LENDING BY THE MUTUAL FUND: Subject to the Regulations and the applicableguidelines, the Scheme may, if the Trustee permit, engage in stock lending. Stock lendingmeans the lending of stock to another person or entity for a fixed period of time, at anegotiated compensation. The securities lent will be returned by the borrower on expiryof the stipulated period.The risks in lending portfolio securities, as with other extensions of credit, consist of thefailure of another party, in this case the approved intermediary, to comply with the termsof agreement entered into between the lender of securities i.e. the Scheme and theapproved intermediary. Such failure to comply can result in the possible loss of rights inthe collateral put up by the borrower of the securities, the inability of the approvedintermediary to return the securities deposited by the lender and the possible loss ofany corporate benefits accruing to the lender from the securities deposited with theapproved intermediary.POLICY ON OFFSHORE INVESTMENTS BY THE SCHEME AND THE PLANSTHEREUNDER: SEBI, vide its letter dated September 30, 1999 permitted mutual fundsto invest in ADRs/GDRs issued by Indian Companies upto 10% of net assets managedas on the date of last audited balance sheet subject to maximum of US$50 million.RBI, vide its letter dated May 26, 2000 read with letter dated August 18, 2000 conveyedtheir approval to the AMC for its investing an amount upto US$19.37 million in theADRs/GDRs issues of Indian Companies in the Overseas market by way of remittancefor India. The approval granted by RBI is valid for a period of one year and is subject tothe AMC complying with the terms and conditions as specified by RBI in its approvalletter referred to above.It is the Investment Manager’s belief that investment in ADRs/GDRs/ overseas securitiesoffer new investment and portfolio diversification opportunities into multi-market andmulti-currency products. However, such investments also entail additional risks. Suchinvestment opportunities may be pursued by the Investment Manager provided they areconsidered appropriate in terms of the overall investment objectives of the Scheme andthe Plans thereunder. Since the Scheme and the Plans thereunder would invest onlypartially in ADRs/GDRs/overseas securities, there may not be readily available and widelyaccepted benchmarks to measure performance of the Scheme and the Plans thereunder.To manage risks associated with foreign currency and interest rate exposure, the Fundmay use derivatives for efficient portfolio management including hedging and inaccordance with conditions as may be stipulated by SEBI/RBI from time to time.Offshore investments will be made subject to any/all approvals, conditions thereof asmay be stipulated by SEBI/RBI and provided such investments do not result in expensesto the Fund in excess of the ceiling on expenses prescribed by and consistent with costsand expenses attendant to international investing.INTER-SCHEME TRANSFERS: The Fund does not envisage making inter-scheme transfersunder the Scheme. However, if such transfers are done they will be effected based onthe closing prices of the Principal Stock Exchange and in conformity with Regulations. Incase of securities which are not traded on the Principal Stock Exchange/any otherexchange, the inter-scheme transfers will be effected based on fair valuation to be arrivedat by the AMC with the approval of the Trustee. No inter scheme transfers were effectedsince April 1998.The Scheme may also use various hedging and derivative products from time to time, asare available and permitted by SEBI, in an attempt to protect and enhance the interestsof the Unitholders at all times. Derivatives are contractual instruments whose performanceis derived from that of on an underlying asset.DIVIDENDS AND DISTRIBUTIONSBalanced Fund, Tax Plan and Technology FundAs disclosed in the Offer Document, the Trustee proposes to adopt the following policyfor the above mentioned schemes.It is proposed to declare dividends under the Scheme either half-yearly or yearly. Dividends,if declared, will be paid out of the net surplus of the Scheme to those Unitholders whosenames appear in the Register of Unitholders on the notified record date. The actualdeclaration of dividends under the Scheme and the frequency thereof will, inter-alia,depend upon the disposable surplus of the Scheme. The decision of the Trustee in thisregard shall be final. The dividend will be at such rate as may be decided by the AMC inconsultation with the Trustee.The AMC may announce a book closure period for the purpose of making the dividendpayment.FMCG FundAs disclosed in the Offer Document, the Trustee proposes to follow the followingdividend distribution policy:The actual declaration of dividends under the Scheme and the frequency thereof will,inter-alia, depend upon the disposable surplus of the Scheme. The decision of theTrustee in this regard shall be final.The dividend that may be paid out of the net surplus of the Scheme will be paid onlyto those Unitholders whose names appear in the register of Unitholders on the notifiedrecord date. The dividend will be at such rate as may be decided by the AMC inconsultation with the Trustee.Income Plan and Growth PlanThe Trustee proposes to follow the following dividend distribution policy:Income Plan – Dividend Option: Annually as of March 31 of each year or at such otherintervals as may be decided by the Trustee. Such dividends, if declared, will be paid onlyto those Unitholders who have opted for dividend option.Growth Plan - Dividend Option: Trustees may declare dividends from time to time. Such


19

dividends, if declared, will be paid only to those Unitholders who have opted for dividendoption.However, it must be distinctly understood that the actual declaration of dividends underany of the Schemes and the frequency thereof will, inter-alia, depend upon the disposablesurplus of the Scheme. The decision of the Trustee in this regard shall be final.The dividend that may be paid out of the net surplus of the Schemes will be paid onlyto those Unitholders whose names appear in the register of Unitholders on the notifiedrecord date. The dividend will be at such rate as may be decided by the AMC inconsultation with the Trustee.Liquid PlanIn the case of the Liquid Plan, the Trustee proposes to introduce a weekly dividend option.The Trustees may approve the distribution of dividend by the AMC on a weekly basisout of the net surplus in this option.Gilt FundEach Plan may declare dividends depending on the net distributable surplus availableunder the respective Plans. Further the frequency of distribution of dividend may varybetween the two Plans.Treasury Plan - Dividend PolicyIt is proposed that distribution of dividend for the Treasury Plan will be done at quarterlyrests.Investment Plan - Dividend PolicyIt is proposed that distribution of dividend for the Investment Plan will be done semiannually.Trustee proposes to follow the following dividend distribution policy:The actual declaration of dividends under the Scheme and the frequency thereof will,inter-alia, depend upon the disposable surplus of the Scheme. The decision of the Trusteein this regard shall be final.The dividend that may be paid out of the net surplus of the respective Scheme will bepaid only to those Unitholders whose names appear in the Register of Unitholders onthe notified record date. The dividend will be at such rate as may be decided by theAMC in consultation with the Trustee. The Unitholders will have option to reinvest thedividend received by them.The AMC may announce a book closure period for the purpose of making the dividendpayment.Monthly Income PlanShut-Out Period (Applicable for Investors under Dividend Option only).After the closure of the Initial Offer Period, on an ongoing basis, Investors should notethat the Trustee reserves a right to declare Shut-Out period not exceeding 5 days atthe end of each month/quarter/half-year, as the case may be, for the investors optingfor payment of dividend under the respective Dividend Plans. The declaration of theShut-Out period is envisaged to facilitate the AMC/the Registrar to determine the Unitsof the Unitholders eligible for receipt of dividend under the various Dividend Options.Further, the Shut-Out period will also help in expeditious processing and despatch ofdividend warrants. The Trustee shall arrange to display a notice at all Customer ServiceCentres at least 10 days before the introduction of Shut-Out period. The Shut-Outperiod will be applicable for making investments in the Scheme. During the Shut-Outperiod investors may make purchases into the Scheme but the Purchase Price forsubscription of units will be calculated using the NAV as at the end of the first BusinessDay in the following month/quarter/half-year as the case may be, depending on theDividend Plan chosen by the investor. Therefore, if investments are made during theShut-Out period, Units to the credit of the Unitholder’s account will be created onlyon the first Business Day of the following month/quarter/half-year, as the case maybe, depending on the dividend plan chosen by the investor. The Shut-Out period appliesto new investors in the Scheme as well as to Unitholders making additional purchasesof Units into an existing folio. The Shut-Out period does not apply to purchases ofUnits under the Cumulative Option. The Trustee reserves the right to change the Shut-Out period and prescribe new Shut- Out period, from time to time.Unitholders under the Dividend Option will have various pay out choices as detailedbelow**:Frequency Record date* First Dividend

pay-out proposed:

a) Monthly To be paid to investor choosing this For the periodDividend Plan dividend plan, who is a Unitholders as ended November,

of the last Business Day of the month for 2000.which dividend is being paid or as on suchother day as may be decided by the Trustee.

b) Quarterly To be paid to investor choosing this For the periodDividend Plan dividend plan, who is a Unitholders as ended February,

of the last Business Day of the quarter 2001.ending February/May/August/Novemberfor which dividend is being paid or as onsuch other day as may be decided by the Trustee.

c) Half Yearly To be paid to investor choosing this For the periodDividend Plan dividend plan, who is a Unitholders as ending February

of the last Business Day of each half year 2001.ending Febraury/August for whichdividend is being paid or as on such otherday as may be decided by the Trustee.

* Investors will be notified the details of the record date at least 5 days in advance by a suitable displayof notice in the Customer Service Centres of the AMC.

** Investors in the Scheme are not being offered any guaranteed returns. Further, the Fund/AMC isnot guaranteeing or assuring any monthly/quarterly/half-yearly returns. The Fund/AMC is also notassuring or guaranteeing that it will be able to make regular monthly/quarterly/half-yearly dividenddistributions to its Unitholders, though, it has every intention to manage the portfolio so as to makesuch payments to the Unitholders. Monthly/ quarterly/half yearly dividend payments will be dependenton the returns achieved by the AMC through active management of the portfolio. The dividenddistributions may, therefore, vary from month to month or quarter to quarter or half year to half year,based on investment results of the portfolio. Further, it should be noted that the actual distributionof dividends and frequency thereof are indicative and will depend, inter-alia, on availability ofdistributable surplus. Dividend payouts will be entirely at the discretion of Trustees.As per the Regulations, AMC is required to despatch dividend warrants to theunitholders within 42 days of the date of declaration of the dividend. However, theMutual Fund will endeavour to make dividend payments within 15 days to theUnitholders.As per the provisions of Income tax Act, the income distributed to the Unitholders ofa mutual fund shall be charged to tax at a flat rate of 20% (subject to applicablesurcharge, if any), to be payable by the mutual fund. The tax liability of a mutualfund is notwithstanding the existing provisions of clause (23D) of Section 10 of Income-tax Act, 1961, which exempts the income of a mutual fund from income tax.UNIT HOLDERS SERVICES AND RIGHTSInvestor Friendly Services: In order to provide efficient service the Fund will endeavorto continuously establish and upgrade systems to handle transactions efficiently andresolve any investor grievances promptly.Problem Resolution: The Fund will follow-up with Customer Service Centres andRegistrar on complaints and enquiries received from investors with an endeavor to resolvethem promptly. For this purpose, Mr. Gautam Guha has been appointed the InvestorRelations Officer. He can be contacted at the Corporate Office of the AMC, Tel.: (91)(22) 2679676/2697989, Pruphone No. (91) (22) 2692929, Fax: (91) (22) 2679677.NAV Information : The NAV of the Scheme will be calculated daily and announced bythe Fund on each Business Day. The information on NAV may be obtained by theUnitholders, on any day, by calling the office of the AMC or any of the Customer ServiceCentres. The Fund will use its best endeavour to publish NAVs daily, in at least two dailynewspapers. Further, the AMC shall endeavour to publish Purchase & Redemption pricesof Units daily in a daily newspaper of all India circulation.Disclosure of information under the RegulationsThe Fund will, not later than six months after the close of each financial year (March31), publish through an advertisement, an abridged Annual Report relating to the Schemeand mail to the Unitholders an abridged scheme wise annual report. It is anticipatedthat the first such publication will be for the period ending March 31, 2001. Further,the full text of the Annual Report will be available for inspection at the office of theFund. A copy of the Annual Report will be sent to Unit holders, free of cost, on specificrequest.The AMC will disclose the NAV of the Scheme on every Business Day.The Fund shall before the expiry of one month from the close of each half year (31st

March and 30th September) send to the unitholders a complete statement of schemeportfolios or if such statement is not sent to the unitholders, it will be published by wayof an advertisement in one English daily circulating in the whole of India and in anewspaper published in the language of the region where the head office of the mutualfund is situated.The Fund shall before the expiry of two months from the close of each half year, that isas on March 31 and September 30, publish its unaudited financial results in one Englishdaily newspaper circulating all India and in a newspaper published in the language ofthe region where the Head Office of the Fund is situated.Rights of Unitholders of the Scheme: (1) Unitholders of the Scheme have aproportionate right in the beneficial ownership of the assets of the Scheme and in caseof declaration of dividend, for the receipt of the dividend declared by the Fund underthe Scheme. (2) When the Fund declares a dividend under the Scheme, the Fund shalldespatch to the Unitholders the dividend warrants within 42 days from the date ofdeclaration of dividend. (3) The Trustee is bound to make such disclosures to theUnitholders as are essential in order to keep them informed about any information knownto Trustee which may have an adverse bearing on their investments. (4) The appointmentof an AMC for the Fund can be terminated by majority of the Trustee or by 75% of theUnitholders of the Scheme of the Fund and any change in the appointment of the AMCshall be subject to the prior approval of SEBI and the Unitholders of the Scheme. (5) TheTrustee is obliged to convene a meeting on a requisition of 75% of the Unitholders ofthe Scheme. (6) 75% of the Unitholders of a Scheme can pass a resolution to wind upthe Scheme. (7) Unitholders have the right to inspect all the documents listed under“Documents Available for Inspection”. (8) The Trustee shall obtain the consent of theUnitholders : (a) whenever required to do so by SEBI, in the interest of Unitholders;(b) whenever required to do so on the requisition made by three-fourths of the Unitholdersof the Scheme; (c) when the Trustee decides to wind up or prematurely redeem the units;(d) when any change in the fundamental attributes of any Scheme or the Trust or feesand expenses payable or any other change which would modify the Scheme or affectthe interest of the Unitholders, is proposed to be carried out, unless the consent of notless than three-fourths of the Unitholders is obtained.Subject to the Regulations and the guidelines issued by SEBI the consent of the Unitholderswill be obtained through voting, by mail. Detailed modalities of the same, including theprinciples for entitlement of votes for each Unitholder will be finalised in consultationwith and after obtaining the approval of SEBI and the Trustee.Duration of the Scheme/ Winding up: The duration of the Schemes is perpetual. TheAMC, the Fund and the Trustee reserve the right to make such changes/alterations inthe Scheme (including the charging of fees and expenses) offered under this Offer

20


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Document to the extent permitted by the applicable Regulations. However, in terms ofthe Regulations a Scheme may be wound up after repaying the amount due to theUnitholders:1) On happening of any event, which in the opinion of the Trustee, requires the Schemeto be wound up, OR 2) If seventy five percent (75%) of the Unitholders of the Schemespass a resolution that the Scheme be wound up, OR 3) If SEBI so directs in the interestof the Unitholders

PENALTIES & PENDING LITIGATIONSCases of Penalties awarded by SEBI under the SEBI Act or any of its regulations orany other regulatory body against the Sponsor of the Mutual Fund or any Companyassociated with the Sponsor in any capacity such as the Asset Management Company,Trustee Company/Board of Trustees, or any of the directors or key personnel of theAsset Management Company and Trustee Company : NilAny pending material litigation proceedings, other than ordinary routine litigationincidental to the business of the Mutual Fund to which the Sponsor of the MutualFund or any Company associated with the Sponsor in any capacity such as the AMC,Board of Trustees/Trustee Company or any of the Directors or key personnel is a party.Any pending criminal cases or economic offence cases against the Sponsor or anycompany associated with the sponsor in any capacity such as AMC, Board of Trustees/Trustee company or any of the directors or key personnel.AMC : One of the Investors under Prudential ICICI Growth Plan had made investmentto the tune of Rs. 50,00,000 under section 54EB of the Income Tax Act, 1961. Inaccordance with the legal opinion of the counsel of the Fund, the Fund is of the viewthat investments under section 54EB of the Income Tax Act, 1961 read with CBDTnotification no. 10247 dated December 19, 1996 and the Offer Document of PrudentialICICI Growth Plan, the units had to be locked-in for a period of seven years from thedate of investment. However, the Investor had disputed this stand and had filed a petitionagainst Prudential ICICI Asset Management Company Limited as one of the respondentsin the Honourable Delhi High court seeking the direction of the Court for prematureredemption of units. SEBI vide its order dated September 4, rejected the petitioner’s claimfor premature redemption of units. Currently the Delhi High Court has permitted thePetitioner to withdraw the petition as per the Petitioner’s application.The Petitioner has since approached the Securities Appellate Tribunal seeking release ofmoney due upon redemption of units and payment of interest there on. The matter hasbeen heard by the Tribunal and its order is awaited.

ICICI : Two criminal complaints have been filed against directors of ICICI in April, 2000at Rajkot by two retail customers of the erstwhile Anagram Finance Ltd. for the allegedviolation of the provisions of the Bombay Money Lending Act, 1946, in respect of vehiclelease transactions. Gujarat High Court has granted interim stay on the proceedings ofthe said complaint based on an application made by ICICI.Any deficiencies in the systems and operations of the Sponsor of the MutualFund or any company associated with the sponsor in any capacity such as theAMC or the Trustee Company which SEBI has specifically advised to bedisclosed in the offer document, or which has been notified by any otherregulatory agency.

ICICI : There are no deficiencies in systems and operations of ICICI except that duringSEBI’s inspection of the Debenture Trustee operations of ICICI, observations on certainshortcomings were made by SEBI in its inspection report. ICICI has initiated suitableaction based on SEBI report and has submitted a detailed reply to SEBI. The matter isbeing examined by SEBI.Prudential Plc.Financial Services Authority (FSA) : The FSA has criticized The Prudential AssuranceCompany Limited (PAC) twice for failing to meet its pension misselling review deadlines.FSA served a section 60 notice and a public statement criticizing PAC’s compliancearrangements with respect to its direct sales force in December 1997.Other companies within the group:In December 1996, Prudential Personal Equity Plans Limited underwent an IMROdisciplinary procedure.In January 1997, the Investment Management Regulatory Organization Limited finedPrudential Personal Equity Plans Limited £70,000 for breaches of the Client MoneyRegulations and related breaches which had occurred several years before.The breaches were caused through the inability of systems to cope automatically withcrediting individual investors’ accounts with dividends declared in respect of theunderlying investments in personal equity schemes. The dividends were handledmanually, were not credited in time and mistakes arose, required insignificant amountsof compensation to be paid to investors.Any enquiry/adjudication proceedings under the SEBI Act and the Regulations madethere under, against the Sponsor of the Mutual Fund or any Company associated withthe Sponsor in any capacity such as the AMC, Board of Trustees/Trustee Company orany of the Directors or key personnel of the Asset Management Company : NilNotwithstanding anything contained in this Memorandum containing key information,the provisions of SEBI (Mutual Funds) Regulations, 1996 and the guidelines thereundershall be applicable.

DOCUMENTS AVAILABLE FOR INSPECTION

(1) Memorandum and Articles of Association of the Trustee Company and the AMC;(2) Custodian Agreement between Trustee and HDFC Bank; (3) Investment ManagementAgreement; (4) Trust Deed and amendments thereto; (5) Mutual Fund RegistrationCertificate; (6) Consent of Registrar to act in the said capacity; (7) Consent of Auditorsto act in the said capacity; (8) Securities and Exchange Board of India (Mutual Funds)Regulations, 1996 and amendments thereof from time to time; (9) Indian Trust Act, 1882.

For and on behalf of the Board of Directors ofPrudential ICICI Asset Management Company Limited

Sd/-

Place : Mumbai Ajay SrinivasanManaging Director


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Investment Plan Investment Option Amount (Rs.)per cheque

No. ofCheques

ChequeNo. from

ChequeNo. to

Drawn on (bank name & branch)

SYSTEMATIC INVESTMENT PLAN – ENROLMENT FORM

BALANCED FUNDGROWTH OPTION

DIVIDEND OPTION Reinvest Dividend

FMCG FUNDGROWTH OPTION


GROWTH PLANGROWTH OPTION


TAX PLANGROWTH OPTION


TECHNOLOGYFUND

GROWTH OPTION


Date & Timeof Receipt

Sub-broker CodeBroker Code

INCOME PLANGROWTH OPTION


LIQUID PLAN GROWTH OPTION

MONTHLYINCOME PLAN

DIVIDEND OPTIONReinvest Dividend

Monthly

Quarterly

Half Yearly

Payout

CUMULATIVE OPTION

AUTOMATICENCASHMENT PLAN

Monthly

Quarterly

Half Yearly

Please refer to the “Key Features” in page nos. 2, 3, 4 & 5.

Folio No. Name of first applicantand Signature(For existing investors)

INSTRUCTIONS FOR SYSTEMATIC INVESTMENT PLAN

STEP 1. The above form needs to be filled in addition to the Common Application Form in case of new investors to Prudential ICICI Mutual Fund Schemes.

STEP 2. Complete all sections of the Common Application Form including Section 2, wherein please input minimum amount details.

STEP 3. Complete the “Systematic Investment Plan” Enrolment Form above.

STEP 4. Issue post dated cheques dated either 7th or 10th of the month for monthly SIP or issue cheques dated 31st March, 30th June, 30th September and 31st Decemberfor Quarterly SIP (this is applicable for all our schemes except for MIP Quarterly SIP where the cheques should be dated 7th or 10th). A credit confirmation will be sentto the unitholder indicating the new balance to his or her credit in the account.

The cheques should be drawn in favour of “Prudential ICICI Growth Plan” or “Prudential ICICI FMCG Fund” or “Prudential ICICI Tax Plan” or “Prudential ICICIBalanced Fund” or “Prudential ICICI Technology Fund” or “Prudential ICICI Liquid Plan” or “Prudential ICICI Income Plan – Growth Option” or “PrudentialICICI Income Plan – Dividend Option” or “Prudential ICICI Monthly Income Plan”, as the case may be and crossed “Account Payee Only”. The cheques should bepayable locally at the centre where the Application is deposited at the Customer Service Centres of Prudential ICICI AMC. The cheques should be drawn on any bankwhich is situated at and is a member / sub-member of the Bankers’ Clearing House. Cheques drawn on a bank not participating in the Clearing House will not beaccepted.

For details on minimum amount and number of cheques under the Systematic Investment Plan (SIP), please refer to the “Key Features” on page 2, 3, 4 & 5 of this document.

The investor will have the right to discontinue SIP at any time he or she so desires by providing a written request at the office of the Prudential ICICI Mutual Fund Service Centres.Notice of discontinuance should be received 10 days prior to the month that it is required to be effected in. The investor will cease to be a part of the SIP on receipt of the writtenrequest and any post-dated cheque(s) remaining will be returned to the investor.

The TrusteePrudential ICICI Mutual Fund,

I/We have read and understood the offer document(s) of Prudential ICICI Mutual Fund. I/We apply for the units of the scheme(s) and I/we agree to abide by the terms, conditions, rulesand regulations of the scheme. I/We confirm to have understood the terms & conditions. Its investment objectives, investment pattern, fundamental objectives and risk factorsapplicable to the respective Fund(s). I/We agree to abide by the terms, conditions, rules and regulations of the Plan(s).

I/We hereby apply for the SIP under the following scheme and agree to abide by the terms and conditions of the respective mutual fund scheme.

INB010808537

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ELECTRONIC CLEARING SERVICE (ECS) OF RBI

It is the intention of the Mutual Fund to make dividend paymentsthrough the ECS. In order to receive your dividend through ECS,Unitholders will be required to complete the ECS Form that ispart of the Application Form. The completed ECS Form will beused to activate ECS for you. Prudential ICICI Mutual Fund urgeUnitholders to enroll for the ECS facility. This facility offers a levelof convenience that is advantageous to both the Unitholder andthe Mutual Fund. The Mutual Fund will also send its Unitholdersa Statement stating that dividend has been paid.Prudential ICICI Mutual Fund retains the right to pay dividendby a cheque/demand draft, even if the Unitholder has enrolledinto the ECS.

Cities covered under ECS

• Ahmedabad • Agra • Allahabad • Amritsar• Bangalore • Bhopal • Bhubaneshwar• Calcutta • Chandigarh • Chennai • Delhi• Cochin • Coimbatore • Dehradun• Durgapur • Faridabad • Gaziabad• Guwahati • Hubli • Hyderabad • Indore• Jaipur • Jamshedpur • Kanpur • Kolhapur• Lucknow • Ludhiana • Madurai • Mangalore• Mumbai • Nagpur • Nashik • Panaji • Patna• Pune • Rajkot • Siliguri • Simla • Surat• Thiruvananthapuram • Trichur • Trichy• Vadodara • Varanasi • Vijayawada• Vishakhapatnam

SAMPLE

001/07776

This is the MICR Number

Where to find the MICR Number ? ECS Instructions

Prudential ICICI Customer Service Centres

CORPORATE OFFICE3rd Floor, Contractor Building, 41, R. Kamani Marg, Ballard Estate, Mumbai 400 038.

Tel: 269 7989; Fax: 267 9677 Website: www.pruiciciamc.com E-mail: [email protected] Pruphone (Mumbai): 269 2929

Hyderabad :L B Bhavan, 6-3-550 Somajiguda(Opp. Medinova),Hyderabad 500082.Tel: (040) 651 0099/100.

Goa :Shop No. 7, Ground Floor, KamatChambers, Opp. Hotel Neptune,Menezes Braganza Road, Panjim403 001. Tel: 0832-424520/511

Chennai :No. 22/4, Aashika Chambers,Chamiers Road, Teynampet,Chennai 600 018.Tel: (044) 433 8228/9.

Chandigarh :S.C.O. 16-17, 2nd Floor,Sector 9-D, Madhya Marg,Chandigarh 160 017.Tel: (0172) 745 302/3.

Ahmedabad :401, Sears Towers,Nr. Panchwati, Gulbai Tekra,Ahmedabad 380 006.Tel: (079) 656 6165, 656 6371.

Bangalore :15/16, Vayudooth Chambers,Ground Floor,Trinity Circle,M G Road, Bangalore-560001Tel: (080) 5323676

Baroda :C/o. ICICI Bank,Landmark, Race Course,Baroda 390 007.Tel: (0265) 322 283/84.

Calcutta :124, Lords, 1st Floor,7/1, Lord Sinha Road,Calcutta 700 071.Tel: (033) 282 4077/82.

Jaipur :305, 3rd Floor,Ganpati Plaza, M.I. Road,Jaipur 302 001.Tel: (0141) 388 724/362 257.

Kanpur :206 Krishna Tower, 2nd Floor,15/63 Civil Lines, Opp. U.P. StockExchange, Kanpur 208001.Tel: (0512) 558 455, 303 520/523

Kochi :No.6, 3rd Floor,Emgee Square, M.G. Road,Kochi 682 035.Tel: (0484) 353 199/374 687.

Lucknow :Office No. 6, Ground floor,Saran Chambers-I, 5 ParkRoad, Lucknow 226 001.Tel: (0522) 237 716/17.

Ludhiana :SCO 147, 4th Floor,Feroze Gandhi Market,Ludhiana 141 001.Tel: (0161) 413 101/102

Mangalore :C/o. ICICI BankBharat Building, 1st Floor,P.M. Road, Mangalore 575 001.Tel: 98450 48638

Mumbai :3rd Floor, Sai Nara, North Avenue &Linking Road Junction, Santacruz (W),Mumbai 400 054.Tel: (022) 605 2153/54, 604 0211.

New Delhi :206, Ashoka Estate, 2nd Floor,24, Barakhamba Road,New Delhi 110 001.Tel: (011) 375 2515/16/17/18.

Bhubaneshwar : 9861054007, Coimbatore : 9843070899,Guwahati : 9864025593, Jamshedpur : 9835039771,Ranchi : 9835039770, Trivandrum : 9847012200, Vijayawada :(0883) 420259, Vishakapatnam : 9848194249, (0891) 666 333.

Patna :306, Ashiana Harnivas,Dak Buglow Road,Patna 800 001Tel: (0612) 230 483

Pune :2nd Floor, Office No.6, AshokVijay Complex, 326, M.G. Road,Pune 411 001.Tel: (020) 400 2180/81.

1

PRUDENTIAL ICICI ACKNOWLEDGEMENT SLIP (To be filled in by the Investor)Received from:

Signature, Stamp & DateApplication for Units of Balanced Fund FMCG Fund Growth Plan Tax Plan

Address

Technology Fund

ABOUT YOU Application No.Name of First Applicant Date of Birth

Name of Guardian (in case minor) Name of Father/Husband

Address (PO Box address is not sufficient) (Overseas address in case of NRIs/FIIs/OCBs) Mode of holding

Occupation

Account Type

Status

If you want a Nomination Formmailed to you, please tick (✓ )

Communication

City State

Tel. No. (Res.): Tel. No. (Off.):

Fax Number: E-Mail:

PAN/GIR No. (Required if the investment is greater than Rs.50,000) Circle/Ward/District☞

Bank Particulars (name of the bank) (Compulsory as per SEBI Regulation) Account Number☞

Branch Address City

Name of Second Applicant

Name of Third Applicant

Single Joint

Anyone or Survivor

Professional

Business

Retired

Housewife

Service

Student

Others

Current

Savings

NRO

NRE

FCNR

Individual

HUF

Company

Trust

Partnership

Bank/FI

AOP/BoI

Club/Society

NRI/OCB/FII

Minor

Others

Date & Time of Receipt

✄ ✄

YOUR CONFIRMATIONThe TrusteePrudential ICICI Mutual Fund,

I/We have read and understood the offer document(s) of Prudential ICICI MutualFund. I/We apply for the units of the scheme(s) and I/we agree to abide by theterms, conditions, rules and regulations of the scheme. I/We confirm to haveunderstood the terms & conditions. Its investment objectives, investment pattern,fundamental objectives and risk factors applicable to the respective Fund(s). I/Weagree to abide by the terms, conditions, rules and regulations of the Plan(s).

DD MM YYYY

Payment of DividendsYou may select either Electronic Clearing Service (ECS) or Direct Credit option for receiving dividends in your bank account. Unitholders who do not select either the ECS or DirectCredit option will receive their dividends by draft/cheque.

SIG

NA

TUR

E(S)

First Applicant

Second Applicant

Third Applicant

3

2

Sub-broker Code

Electronic Clearing Service (ECS) (See instruction on page no. 22)

ECS allows credit of dividends into unitholders bank account if their bank branch is coveredunder ECS as per the RBI regulations.

I authorise Prudential ICICI to credit my dividends through ECS (Please ✓ )

MICR Code No. of your bank and branch

Please refer to page no.22 for “Whereto find the MICR Number?”

Important: Please attach a blank “cancelled”Cheque or a clear photo copy of the cheque.

Direct Credit of Dividend and RedemptionIf you have an account in any of the following banks you can opt for direct creditof dividend and redemption to your bank account.I authorise Prudential ICICI to credit my dividends/redemption amount to my accountmaintained with the following bank (Please ✓ ):

I/We hereby declare that the particulars given herein are correct and complete. If thetransaction is delayed or not effected at all for reasons of incomplete or incorrectinformation, I would not hold Prudential ICICI Mutual Fund responsible. I have read theinstructions and agree to discharge the responsibility of me/us as a participant under the“ECS” scheme.

ABN Amro BankAmerican Express BankStandard Chartered GrindlaysBank of America

Centurion BankCitibank N.A.Deutsche BankHDFC Bank

Hongkong BankICICI BankIDBI BankStandard Chartered

Account Number

Branch

City

Mr. Ms. M/s.

Mr. Ms.

Mr. Ms. M/s.

Mr. Ms. M/s.

Income Plan Liquid Plan Gilt-Treasury Gilt-Investment Monthly Income Plan

INB010808537

Broker Code

Note: All future communications in connection with this application should be addressed to the Registrar, quoting full name of the first applicant, the application serial number, the name of thescheme, the amount invested, date and the place of the Customer Service Centre where application was lodged.

PRUDENTIAL ICICI ACKNOWLEDGEMENT SLIP (To be filled in by the Investor)Investment Plan Cheque/DD No. Dated Amount (Rs.) Drawn on (Name of Bank & Branch)

YOUR INVESTMENT & PAYMENT DETAILS OF PRUDENTIAL ICICI DEBT FUNDS

✄ ✄

LIQUID PLAN(See instruction no. 5)

If you do not indicate aninvestment option, the

default option is growthoption.

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch

Account Type(For NRI Investors only)

NRO

Date

FCNR NRE NRSR

DD Charges (B)Amount Paid(C) = (A) – (B)Rs. Rs. Rs.

GILT FUNDTreasury Plan



GILT FUNDInvestment Plan



Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.

OR Dividend Option Reinvest Dividend Pay DividendOR

MONTHLYINCOME PLAN


default option iscumulative option.

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.

Dividend Option

Monthly

Quarterly

Half Yearly

Reinvest Dividend Pay DividendOR

Cumulative OptionAutomatic Encashment Plan

Monthly

Quarterly

Half Yearly

Growth Option OR Dividend Reinvestment Option

5

4

INCOME PLAN



Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

DD Charges (B)Amount Paid(C) = (A) – (B)Rs. Rs. Rs.

Growth Option OR Dividend Option Reinvest Dividend Pay DividendOR

Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.


P.T.O.

7

Note: All future communications in connection with this application should be addressed to the Registrar, quoting full name of the first applicant, the application serial number, the name of thescheme, the amount invested, date and the place of the Customer Service Centre where application was lodged.

PRUDENTIAL ICICI ACKNOWLEDGEMENT SLIP (To be filled in by the Investor)Investment Plan Cheque/DD No. Dated Amount (Rs.) Drawn on (Name of Bank & Branch)

6 YOUR INVESTMENT & PAYMENT DETAILS OF PRUDENTIAL ICICI EQUITY FUNDS

✄ ✄

BALANCED FUND


default option is dividendreinvestment.

FMCG FUND





GROWTH PLAN

TAX PLAN



TECHNOLOGYFUND



Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.


Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.


Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Rs. Rs.


Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.


Growth Option

Amount Invested (A)

Cheque/Draft No.

Bank Name & Branch


NRO

Date

FCNR NRE NRSR

Amount PaidRs. Rs.


DD Charges (B)Amount Paid(C) = (A) – (B)Rs.

REGISTRARComputer Age Management Services Pvt. Ltd.

A & B Lakshmi Bhawan, 609, Anna Salai, Chennai - 600 006, India. Tel.: (044) 431 2121 / 2 / 3; Fax: (044) 431 2124

Note: All future communications in connection with this application should be addressed to the Registrar at the address given in this Form, quoting full nameof Sole/First Applicant, the Application Serial Number, the name of the Scheme, the amount invested, date and the place of the Customer Service Centrewhere application was lodged.

INSTRUCTIONS TO INVESTORS

The application form is for resident investors and NRIs and should becompleted in English in BLOCK Letters.

1. The Signature(s) should be in English or in any of the Indian languagesspecified in the Eighth Schedule of the Constitution of India, Thumbimpressions must be attested by a Magistrate or a Notary Public or aSpecial Executive Magistrate under his/her official seal. Applications byminors should be signed by their guardians. In case of HUF, the Kartashould sign on behalf of the HUF.

2. Investment Options: Investors investing in any of the Schemes arerequested to choose either the Growth Option or Dividend Option(within the Dividend Option investors should select either DividendPayout or Dividend Reinvestment (default) ).

3. SIP: Investors opting for monthly SIP must issue post dated chequesdated either the 7th or 10th of every month. In case investor is optingfor Quarterly SIP, please issue cheques dated 31st March, 30th June,30th September and 31st December. Please refer to “Key Features”on Page Nos. 2, 3, 4 & 5 for details on minimum amount and numberof cheques under the SIP and also refer Page No.23 for the SIP Form.

4. Mode of Payment: The cheque /demand draft should be drawn infavour of “Prudential ICICI Liquid Plan” or “Prudential ICICI IncomePlan – Growth Option” or “Prudential ICICI Income Plan –Dividend Option” or “Prudential ICICI Growth Plan” or“Prudential ICICI FMCG Fund” or “Prudential ICICI Tax Plan” or“Prudential ICICI Gilt Fund – Treasury Plan” or “Prudential ICICIGilt Fund – Investment Plan” or “Prudential ICICI Balanced Fund”or “Prudential ICICI Technology Fund” or “Prudential ICICIMonthly Income Plan”, as the case may be and crossed “AccountPayee Only”. The cheque / demand draft should be payable locally atthe centre where the Application is deposited at the Customer ServiceCentres of Prudential ICICI AMC. The cheque / demand draft shouldbe drawn on any bank which is situated at and is a member / sub-member of the Bankers’ Clearing House. Cheques / demand draftsdrawn on a bank not participating in the Clearing House will not beaccepted.

5. In case of Liquid Plan – Dividend Reinvestment Option, theminimum value of an application from a new investor shouldbe for Rs.1,00,000 (One Lac only). Cheques for additionalinvestment in the Liquid Plan – Dividend Reinvestment Optionshould be for a minimum amount of Rs.1,00,000 (One Lac only).Under the Liquid Plan – Dividend Reinvestment Option, both inrespect of the initial investment and the additional investment,the application will be accepted only in those centres that havea high value clearing facility and the cheques issued by theinvestor for the applications under this option should be suchthat they can participate in the high value clearing of thatcentre, as per the rules governing high value clearing in thatcentre.

6. NRI Mode of payment: Payments by NRIs / OCBs / FIIs and personsof Indian origin residing abroad, may be made by way of Indian Rupeedrafts purchased abroad or by way of cheques drawn on Non-Resident(External) NRE Accounts payable at par and payable at the cities wherethe Customer Service Centres are located. Payments can also be madeby means of Rupee drafts payable at the cities where the CustomerService Centres are located and purchased out of funds held in NREAccount / FCNR Account.

7. In case of Indian Rupee drafts purchased or subscription through NRE/FCNR Account, an account debit certificate from the bank issuing thedraft confirming the debit should also be enclosed.

8. OCBs: Applications by OCBs should be accompanied by an OAC /OAC1 from an Overseas Auditor / Chartered Accountant / CertifiedPublic Accountant and should be sent to the Registrar at Chennaiwithin 15 days of the application date.

9. Investors residing in centres, where the Prudential ICICI CustomerService Centres are not located, are requested to make payment bydemand drafts. No request for refund of charges will be entertained.

10. NRIs/OCBs/persons of Indian origin investing on a non-repatriable basismay do so by issuing cheques/demand drafts drawn on Non-ResidentOrdinary (NRO) accounts.

11. Payments by Stockinvests and cash will not be accepted.

12. The Application Form Number, the Scheme name and the name ofthe applicant should be mentioned on the reverse of the instrumentthat accompanies the application.

13. The first Unitholder should provide the name of the bank branch,complete address of the branch, account type and account number,which is mandatory as per Securities Exchange Board of India circularIIAMRP/MF/CIR/07/826/98 dated April 15, 1998. Applications withoutthis information will be deemed to be incomplete.

14. If the application is for Rs. 50,000 or more, then the PAN/GIR numberand IT Circle/Ward/District (if available) of the sole/first applicant shouldbe mentioned.

15. Applicants should indicate their category by ticking the appropriate box.Applications without a tick in the ‘Category’ box will be consideredas investment by “Others”.

16. Applicants should specify the mode of holding. In case of joint holders,the first named holder shall receive all the Account Statements,dividend/redemption/refund warrants and any other correspondencesent from time to time.

17. In case of an application under Power of Attorney or by a limitedcompany, body corporate, registered society, trust or partnership, etc.the relevant Power of Attorney or the relevant resolution or authorityto make the application as the case may be, or duly certified copythereof, along with the Memorandum and Articles of Association / bye-laws must be lodged alongwith the application form or such documentsmay reach the Registrar within 15 days from the date of receipt ofapplication.

18. The Application completed in all respects along with the cheque /demand draft must be submitted to the nearest Customer ServiceCentre. Applications for the Liquid Plan – Dividend ReinvestmentOption will be accepted only at Mumbai, Delhi, Calcutta,Chennai, Bangalore, Ahmedabad and Hyderabad offices of theAMC.

19. No receipt will be issued for the application money. The CustomerService Centres will stamp and return the acknowledgement slip in theapplication form, to acknowledge receipt of the application.

20. Applications incomplete in any respect or not accompanied by a chequeor demand draft for the amount payable are liable to be rejected andthe money paid will be refunded without interest.