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Macro economic indicators are showing signs of stability

Indicator Current* Outlook

Inflation (CPI) 2.3%


RBI’s focus on inflation is likely to
keep rates stable over the year
Interest Rate (Repo Rate) 6.5%

Real Rate 4.2% Positive real rates

Falling crude has made the terms of


Crude (Brent $/bbl) 54.2
trade once again back in India's favor.

GDP (Annual Growth Rate) 7.1% Strong growth

Forex Reserves USD 393 bn

BoP USD -1.9bn India’s strong external position

CAD (as a % of GDP) -2.9%

* Data available as on 31st Dec 2018. Source: Bloomberg

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RBI is targeting for neutral liquidity
OMOs and term repos helping offset the liquidity shortfall & controlling bond yields
Trailing Interbank Liquidity : expected to be in neutral zone RBI scaled up OMO purchases to neutralize liquidity deficit

100 Net Absorption 600 RBI increased OMO purchases to


OMO, INR bn
(+)/Infusion(-) of INR 500 Bn in Dec-18; announced
80 Liquidity, US$ bn 500 purchases of INR 500 Bn for Jan-19
60 400

40 300

20 200

0 100

-20 0

-40 -100

-60 -200
Dec-15

Dec-16

Dec-17

Dec-18
Jun-16

Jun-17

Jun-18
-300
Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18 Jan-19

Source: Morgan Stanley. Data as on 31st Dec 2018.

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We expect a stable rate scenario over the next few months

Eased inflation Operating rate close to Repo

6.0 7.0

5.0
6.5

4.0
6.0
3.0

5.5
2.0
2.33

5.0
1.0

0.0 4.5
Dec-16 Jun-17 Dec-17 Jun-18 Dec-16 Jun-17 Dec-17 Jun-18 Dec-18
CPI - Combined Repo CCIL-CBLO Overnight Rate
Tri Party Repo

Source: Morgan Stanley. Data as on 31st Dec 2018.

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We prefer short end over longer end of the curve

Short end offers attractive spread over G-Sec & Repo Long end of to be range bound : Do not expect structural rally
9.0
Repo 10 year G-Sec yield (%)
8.5 8.50
3 year AAA PSU Recent rally of >80bps
137 bps over
8.0 8.00
3 year G-Sec Yield GSec
7.5 7.50
Expect only tactical
7.0 191 bps 7.00 opportunities going
over forward
6.5 Repo
6.50

6.0
6.00

5.5
Dec-16 Jun-17 Dec-17 Jun-18 Dec-18 5.50
Dec-16 Jun-17 Dec-17 Jun-18 Dec-18

Source: Bloomberg, Data as on 31st Dec 2018.

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Key risks to watch
Global growth, Crude , Food inflation and Fiscal are the key risks to watch for
Brent Crude Price ($/barrel) : Increased volatility Fiscal Deficit: GST trends weak; can lead to higher than expected fiscal gap

Brent crude price ($/barrel) Impact of every $10 oil price


95 increase
CA Balance %
85 -0.3%
of GDP
75 Inflation (CPI) 0.4%
65
Fiscal balance 0.05% of GDP.
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Nov-17 May-18 Nov-18
FY19 GDP Growth Revised Down to 7.2% due to Inflationary Headwinds Food Inflation
4.7
8 3.26 2.81 3.1 2.91
2.8
Revised 1.37
7.5 0.29 0.51
Real GDP
Food disinflation has led headline
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CPI to be significantly lower than -0.86
RBI's target -2.61
6.5
FY16 FY17 FY18 FY19F Jan-18 Apr-18 Jul-18 Oct-18

Source: Bloomberg, Trading economics, India Ratings, Morgan Stanley, Axis MF Research, CLSA. Data available as on 31st Dec 2018.

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Axis Short Term Fund - Positioning

High quality & low-risk Capture opportunities in the


Medium term horizon
strategy short term segment

Portfolio Characteristics
(as on 31st Dec 2018) Average for the last 1 year

Average Maturity 1.8 years


Allocation to High Rated
91%
Papers#
Macaulay Duration 1.5 years

Modified Duration 1.4 years


Allocation to G-Sec 8%
Yield to Maturity^ 8.40%

Allocation & maturity is based on the current market conditions and is subject to changes depending on the fund manager’s view of the markets. ^The yield to maturity given above is based on
the portfolio of funds as on date given above. This should not be taken as an indication of the returns that maybe generated by the fund and the securities bought by the fund may or may not be
held till their respective maturities. The calculation is based on the invested corpus. #High Rated Papers refers to instruments which are rated AAA/A1+ & equivalent or G-sec. Data as on 31st
Dec 2018.

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Dynamically managed short duration fund

Asset Allocation Mix & Average Maturity


100% 4.00

90%
3.50
Money Market Instruments
80%

Average Maturity (years)


3.00
70%
% of Net Assets

2.50
60%

50% 2.00

40% G-Sec 1.50


30%
1.00
20%

10% Corporate Bonds 0.50

0% 0.00
Dec-16 Jun-17 Dec-17 Jun-18 Dec-18
Average Maturity (years)

Source: ACEMF. Allocation & maturity is based on the current market conditions and is subject to changes depending on the fund manager’s view of the markets. Please refer to Scheme Information
Document (SID) for detailed asset allocation and investment strategy. Data as on 31st Dec 2018.

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Performance as on 30th Nov, 2018

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Annexure for returns of schemes managed by fund manager

Refer slide 12 for disclaimer.

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Annexure for returns of schemes managed by fund manager

Refer slide 12 for disclaimer.

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Performance Disclaimer
#Scheme Performance may not be strictly comparable with that of its additional benchmark in view of hybrid nature of the scheme. @@The performance data
for 5 years period has not been provided for scheme/plan not in existence for 5 years. @The performance data for 3 years period has not been provided for
scheme/plan not in existence for 3 years. Data as on December 31, 2018.

Past performance may or may not be sustained in future.

Calculations are based on Growth Option NAV. Since inception returns are calculated on Rs. 2026.8384/- for Gold ETF & Rs. 10/- for all other schemes.
Different plans have different expense structure. Plan of the scheme for which performance is given is indicated above. The above data excludes performance
of Fixed Maturity Plans and all the schemes which have not completed a year. Top 3 and Bottom 3 schemes (based on 1 year performance) managed by
Devang Shah has been provided herein.

Devang Shah is managing Axis Liquid Fund, Axis Dynamic Bond Fund, Axis Gilt Fund , Axis Strategic Bond Fund and Axis Short Term Fund and all Axis Hybrid
Funds since 5th November 2012 (since inception date for Axis Hybrid Funds launched after 5th November, 2012), Axis Credit Risk Fund and Axis Arbitrage
Fund since inception and Axis Treasury Advantage Fund and Axis Regular Saver (Debt portion), Axis Gold Fund, Axis Gold ETF , all Axis Fixed Term Plans
since 7th June, 2016 (since inception date for Axis Fixed Term Plans launched after 7th June, 2016) and Axis Corporate Debt Fund since July 13th, 2017.
W.e.f January 1, 2013, Axis Short Term Fund - Institutional Plan, Axis Treasury Advantage Fund - Institutional Plan & Axis Liquid Fund - Institutional Plan have
been renamed Axis Short Term Fund, Axis Treasury Advantage Fund & Axis Liquid Fund, respectively.

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Product Labelling
Fund Name Riskometer Product Labelling

Axis Short Term Fund This product is suitable for investors who are seeking*
(An open ended short term debt scheme investing in instruments such • Regular income while maintaining liquidity over short term
that the Macaulay duration of the portfolio is between 1 year to 3 years) • Investment in debt and money market instruments

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

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Product Labelling
Fund Name Riskometer Product Labelling
Axis Credit Risk Fund This product is suitable for investors who are seeking*
(An open ended debt scheme predominantly • Stable returns in the short to medium term
investing in AA and below rated corporate bonds • Investment in debt and money market instruments
(excluding AA+ rated corporate bonds) across the yield curve and credit spectrum.

Axis Corporate Debt Fund This product is suitable for investors who are seeking*:
(An open ended debt scheme predominantly • Regular income over short to medium term
investing in AA+ and above rated corporate bonds) • Predominantly investing in corporate debt

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

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Product Labelling
Fund Name Riskometer Product Labelling
This product is suitable for investors who are seeking*
• Capital appreciation while generating income over
Axis Hybrid Fund Series – 26,27,33 medium to long term.
(42 months close ended debt scheme) • To Investment in debt and money market
Instruments as well as equity and equity related
Instruments
This product is suitable for investors who are seeking*
Axis Gold Fund • Capital Appreciation over medium to long term
(An open ended fund of fund scheme investing in • l Invests predominantly in Axis Gold ETF in order to
Axis Gold ETF) generate returns similar to the underlying fund,
subject to tracking error

*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

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Statutory Details and Risk Factors
Past performance may or may not be sustained in the future. Sector(s) / Stock(s) / Issuer(s) mentioned above are for the purpose of disclosure of the
portfolio of the Scheme(s) and should not be construed as recommendation. The fund manager(s) may or may not choose to hold the stock mentioned, from time
to time. Investors are requested to consult their financial, tax and other advisors before taking any investment decision(s).

Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trusts Act, 1882, sponsored by Axis Bank Ltd. (liability restricted to Rs. 1
Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC) Risk Factors: Axis Bank Limited is not liable or
responsible for any loss or shortfall resulting from the operation of the scheme.

This document represents the views of Axis Asset Management Co. Ltd. and must not be taken as the basis for an investment decision. Neither Axis Mutual
Fund, Axis Mutual Fund Trustee Limited nor Axis Asset Management Company Limited, its Directors or associates shall be liable for any damages including lost
revenue or lost profits that may arise from the use of the information contained herein. No representation or warranty is made as to the accuracy, completeness or
fairness of the information and opinions contained herein. The AMC reserves the right to make modifications and alterations to this statement as may be required
from time to time.

Source of Data: Bloomberg, RBI, ACEMF

Data as on Dec 31, 2018 unless specified differently

Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.

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Thank you