Shriram AMC thrives on a foundation built on 4Ps: Performance, Product, Placement and People

Dear Shareholders,

The last fiscal has been a watershed year in many ways the Indian Asset Management Industry. Industry AUMs as at end of March 2024 crossed the 53 lakh crore mark, growing at 35% over the last year and a CAGR of over 21% over the last 10 years. The dependence on foreign inflows to support market valuations has systemically reduced when compared to the situation during the global financial crisis. This has been driven by a sustained vote of confidence from domestic investors with a steady increase in SIP

(Systematic Investment Plan) inflows that crossed an exit run rate of 19,000 cores in March 2024 up 35% over the corresponding month in the previous year. This reflects success of the industry sponsored campaign around ‘Mutual Funds Sahi Hai' which, along with the dramatic and heady run up in small and mid cap stocks, has fueled investors' imagination and catalysed the irreversible trend towards financialization of savings.

The above story has unfolded in the backdrop of higher government capex in infrastructure and manufacturing with the Financial Year 2024 GDP growth surpassing the 8% mark. This has been supported by a steady rupee, stable government and strong tax collections all of which and more has led to a confident,resurgent India. Per capita income has crossed the tipping point of US$ 2,000 and this places more investable cum consumption surplus in the hands of the burgeoning middle class which has finally become a meaningful segment in terms of size as well as opportunity. While the world continues to experience geo political uncertainty, India's relatively neutral and mature foreign policy and strong central bank intervention has helped position the country very favourably amongst emerging markets. The years ahead promise to be India's decade and we are well on our way to becoming the third largest economy in the world. You will be happy to know that your AMC is also positioning itself to benefit from this positive sentiment and strong economic tailwinds. We have gone through a period of rejuvenation and transformation over the last year as a new chapter unfolds with SAMC 2.0. Shriram AMC has been the first listed AMC in the country and after a long period of being in maintenance mode, we have now shifted gears as we embark on an exciting journey of building a world class asset management business with sustainable and profitable scale. Our purpose is to democratise access to differentiated and relevant solutions that help meet the aspirations of our customers while building on the long standing trust of the Shriram Group, and creating value for our investors, shareholders, partners and employees. With this intent in mind, we have consciously focused on three key pillars to drive the business – Performance, Product and Placement. Performance is at the core of an asset manager and over the last year we have developed our proprietary Enhanced Quantamental Investment (EQI) framework and implemented it across all our equity schemes from September 2023 onwards, with the objective of delivering sustainable, consistent alpha (i.e. higher returns over the benchmark). You will be happy to know that we have been able to deliver to these objectives, with all our equity funds moving from the bottom quartiles to the top two quartiles in their respective categories. The EQI model helps build a portfolio of stocks that are characterized by lower volatility, higher momentum and relatively lower valuation. Our fundamental analysts review each suggested stock along with their own high conviction picks, to build a final risk adjusted portfolio for you. You can invest in our range of mutual funds through your financial advisors, mutual fund distributors, fintech platforms or online at https:// shrifunds.shriramamc.in.

Building on our performance, and in line with the guidance of our Group founder, we are working on creating Products that are attractive, give good results and have an element of safety. Towards this objective we introduced the Shriram Multi Asset Allocation Fund, an equity-oriented fund, with well-balanced asset allocation driven by a risk parity model designed to maximise returns at an optimal level of risk. This fund provides a balanced mix of upside of Equity, stability of Debt and downside protection of Gold – a good all weather investment option for many goals. With this

New Fund Offer, our current portfolio of schemes across

Shriram Flexi Cap Fund, Shriram ELSS Tax Saver Fund, Shriram Multi Asset Allocation Fund, Shriram Aggressive Hybrid Fund, Shriram Balanced Advantage Fund and Shriram Overnight Fund delivers a core set of solutions across the risk-return spectrum and sets the foundation to build on with future propositions. Placement or distribution is our third pillar for building a scalable business such that our investment solutions reach our target audience. We are focusing on both internal Group channels as well as through external partners across retail, wealth and institutional segments.

The Shriram Group offers a wide footprint of over 4,400 branches, 1.61 lakh agents, 3.2 crore customers and 1.22 lakh employees for us to tap into. Shriram Finance, the flagship company of the Group, has also taken up the license for mutual fund distribution and we are working closely with all Group entities to embed mutual funds into the ecosystem including all Group treasuries who are also participating in our fixed income solutions. Our external channel partners are a core area of focus for us – we truly believe in the ethos of the Shriram Group that we can only grow along with partnerships. Our seamless online empanelment process went live in February 2024, and as at March 2024 we have empanelled 10,642 channel partners across individual, regional and national distributors, advisors, wealth managers, banks and fintech platforms. To serve them better we have implemented a tiered service architecture with virtual and on-ground relationship managers, national alliance leads and telephone cum email support. We regularly seek feedback on our service levels with an eye on continuous improvement.

Needless to say, over and above the 3Ps mentioned above, the 4th most important pillar remains our People. While the AMC will complete 30 years in 2024, we are driving SAMC 2.0 with a start-up mindset. All our above mentioned efforts have been delivered by a dedicated and committed team with a strong sense of intrapreneurship, business ownership and growth orientation while keeping a close eye on the cost benefit of every initiative. The impact can be seen as our AUMs have nearly doubled growing 97% from 272 Cr in March 2023 to 536 Cr in March 2024. As we scaled up our presence, our number of customers have also increased 54% to nearly 22,000 in the same period. More importantly with the right margin mix we have also kept our loyal partners optimally incentivized. Looking ahead and building on this early momentum, your refreshed AMC continues to work very hard on strengthening the building blocks for sustained and profitable growth with a focus on improving our quality of solutions and excellence of service. We are constantly seeking and testing ways to enhance our EQI model in line with an evolving environment. Our product solutions will focus on addressing the needs of customers to ensure relevance while assisting in their asset allocation in a differentiated and tax efficient manner. Placement remains key for growth and we are building and nurturing long standing relationships with the right partners so that our solutions reach the right audience. People make all the difference and we are carefully recruiting the right team with a growth mindset and those with belief in the long term growth story of Shriram AMC. These are exciting times indeed, both for the asset management industry as well as for Shriram AMC. While we have our fair share of challenges ahead of us, we are also convinced about the opportunity of wealth and value creation that lies before us, while making a meaningful difference to the aspirations of our customers. We look forward to your ongoing and valuable support as we advance on this journey to build and create a new forward looking AMC with its rightful place under the sun.

Warm Regards,