Annual Report 2008-09 From the Managing Director’s Desk

Dear Investor,

The year 2008-09 has been one of the toughest ones for the markets and the mutual fund industry, wherein the equity markets touched new lows after peaking. A lot of factors were responsible for this, including the global crisis. The markets witnessed a major downfall in October 2008, and later recovered slightly, towards the end of the financial year. We appreciate the patience shown by our investors who did not panic but stayed invested with a long term horizon. I am happy to share with you that we continue to increase our investor base and over 57 lakh investors have shown trust in SBI Mutual Fund. Enclosed is the annual report for the year 2008-09 for your perusal.

While our Assets under Management (AuM) stood at Rs. 26382.68 crores as on 318t March 2009 (Source: http://www.amfiindia.com), we “have managed to win the trust and faith of over 57 lakhs investors, with our consistent performance. And a testimony to this is in the form of various awards that we have won during the year. SBI Mutual Fund has been voted as the ‘Best Equity Fund-House Runner Up1 in the country, by Outlook Money - NDTV Profit Awards 2008. Moreover, SBI Mutual Fund has won many other prestigious awards for scheme performance during the year.

SBI Mutual Fund launched SBI Gold Exchange Traded Scheme (SBI GETS) in March 2009 and offered a new asset class for investors. Gold has been one of the traditional investment avenues and an asset class which has always seen huge interest from investors. Now investors can invest in gold with ease and convenience, and at the same time, have liquidity through stock exchange. It will be our endeavour to introduce innovative products in line with our investors’ financial requirements.

I assure you that we shall continue to maintain high standards of investment performance in the future, too. It has always been our endeavour to help our investors achieve their financial dreams, and one of the tools to ensure that an investor stays on course with his/her dreams, is by investing through a Systematic Investment Plan (SIP) in some of our award winning schemes like Magnum Contra Fund, Magnum Taxgain Scheme, Magnum Balanced Fund and Magnum Multiplier Plus Scheme, just to name a few.

Lastly, I would also like to assure you of our commitment to provide unparalleled service to our investors and cater to your information, investment and servicing needs. Please feel free to call at our dedicated customer care numbers, 1 -800-425-5425 and 080-26599420, from Monday to Saturday (8am-10pm) or write to us at [email protected] with your queries. Alterna- tively, you can also visit your nearest Investor Service Centre / Investor Service Desk for any assistance. We are also constantly increasing our service network by opening new Investor Service Centres and Investor Service Desks to service our valued investors better. We have also been adding more distributors, thereby strengthening our distribution network to offer our award- winning products through them.

I am more than confident that your trust and faith in us will earn rich dividends for you in the future.

Warm regards,

Achal Kumar Gupta Managing Director

Annual Report 2008-09 1 MAGNUM TAXGAIN SCHEME REPORT OF THE BOARD OF DIRECTORS OF SBI MUTUAL FUND TRUSTEE COMPANY PRIVATE LIMITED FOR THE YEAR 2008-09 The Directors of SBI Mutual Fund Trustee Company Private Limited have pleasure in presenting the Audited Accounts in respect of the schemes of SBI Mutual Fund for the year ended 31st March 2009. The scheme wise financial statements for the year 2008-09, are enclosed with the report of the auditors. The significant accounting policies through which the financial statements of the schemes are drawn up and the explanatory notes to accounts of each of the schemes are also attached. The financial statements have been prepared as per the SEBI (Mutual Fund) Regulations 1996, in the manner required and exhibit true and fair view of the operating results. THE ECONOMY The Indian economy managed 6.7 per cent economic growth in 2008-09 despite the manufacturing sector recording a dismal performance. A 5.8 per cent growth rate during the last quarter of the fiscal, at a time when most developed economies have shrunk, puts India among the top-most growing nations. The growth rate during 2008-09 is lower than the nine per cent in the preceding fiscal, but not as low as expected by certain analysts and quite in the range projected by the RBI: 6.5-7 per cent. However, manufacturing growth turned negative at 1.4 per cent in the fourth quarter, pulling down Q4 GDP growth to 5.8 per cent from 8.6 per cent during the corresponding period of the previous year. GDP growth in the third quarter of 2008-09 has been revised to 5.8 per cent from 5.3 per cent estimated provisionally. Agriculture posted 1.6 per cent growth in 2008-09 against 4.9 per cent in 2007-08, even as it bettered performance in the fourth quarter of the last fiscal to 2.7 per cent against 2.2 per cent in the same period in the previous fiscal. The Central Statistical Organisation had pegged GDP growth at 7.1 per cent for 2008-09 in its advance estimates. The downward revision in the GDP growth rate is mainly on account of lower than anticipated performance in almost all the sectors excluding construction and community, social and personal services. CAPITAL MARKETS 2008-09 was a difficult year for the stock markets worldwide. The global financial crisis, which began in 2007 took a turn for the worse in September 2008, with the collapse of several international financial institutions, including investment banks, mortgage lenders and insurance companies leading to a global crash in stock markets. The slowdown intensified with the US, Europe and Japan sliding into recession. The Bombay Stock Exchange (BSE) Sensex fell from 15,644 as at the end of March 2008 to 9,708 as at the end of March, 2009, while the National Stock Exchange (NSE) index Nifty 50 fell from 4,735 to 3,021 during the same period. The markets ramined volatile throughout the year. However, towards the end of the year, the negative sentiment prevailing globally seemed to be waning with investors expecting that low interest rates, stimulus plans and banking bail-outs would lead to a recovery in the world economy. In India, the economy seemed to be getting back into a growth path with major sectors such as cement, steel, automobiles and tourism showing recovery. The year saw negative FII flows, with net sales of equities worth USD 11.8 bn (Previous Year USD 12.9 bn). The domestic mutual funds, however, net bought equities worth Rs. 6,984 crore (Previous Year Rs 13,685 crore) during the year. MUTUAL FUND INDUSTRY During the year, the following important developments took place in the Mutual Fund Industry: a) The filing fee & Registration fee payable by mutual funds were revised. b) SEBI enhanced the aggregate ceiling for overseas investment to US $ 7 billion. c) Notification on Real Estate Mutual Fund Schemes and Initial Issue Expenses was issued. d) The formats of Standard Offer Document and Key Information Memorandum were revised. e) Existing mutual fund schemes were allowed to engage in short selling of securities as well as lending and borrowing of securities after making additional disclosures including risk factors in the Scheme Information Document. f) SEBI clarified that the SEBI circular no. SEBI/IMD/CIR No.1/91171/07 dated April 16, 2007 shall not apply to term deposits placed as margins for trading in cash and derivatives market. g) E-mailing of Abridged Scheme-wise Annual Reports was permitted, if so mandated. h) Valuation procedure of Debt securities was revised. i) In respect of purchase of units in Income/ Debt oriented schemes (other than liquid fund schemes and plans) with amount equal to or more than Rs. 1 crore, irrespective of the time of receipt of application, the closing NAV of the day on which the funds are available for utilization was made applicable. j) In case of Close Ended Schemes (except Equity Linked Savings Schemes) to be launched on or after December 12, 2008, (i) Mandatory listing was introduced; (ii) Listing fee was made a permissible expense to be charged under Regulation 52(4); (iii) Trustees are to ensure that before launch of the scheme the in-principle approval for listing has been obtained from the stock exchange(s) and appropriate disclosures are made in the Scheme Information Document; (iv) NAV to be computed and published on daily basis; (v) Close ended debt scheme shall invest only in such securities which mature on or before the date of the maturity of the scheme. k) In case of liquid schemes, the tenure of the securities held in the portfolio from the one year was reduced and SEBI directed to discontinue the nomenclature of “Liquid Plus Scheme” since it gives a wrong impression of added liquidity. l) SEBI also decided that the Mutual Funds shall not offer/communicate any indicative portfolio and indicative yield. m) Monthly Portfolio disclosure norms were introduced for debt oriented close-ended and interval schemes/plans. During the year, the total resources mobilised by the mutual fund industry stood at Rs 54,26,353 crore (Previous year Rs. 44,64,376 crore) while the total repurchase/redemption amount was Rs. 54,54,649 crore (Previous year Rs. 43,10,575 crore) (Source : SEBI website). The industry thus saw a net outflow of Rs. 28,296 crore (Previous year net Inflow of Rs. 1,53,801 crore) during the year. Although the tax-saving funds, balanced funds, growth- oriented equity funds and fund of funds investing overseas contributed a net inflow of Rs. 4,863 crore, the net outflow of Rs. 33,159 crore in income/ debt oriented funds and exchange traded funds resulted in a net outflow of Rs. 28,296 crore. The total Assets under management as on 31st March, 2009 stood at Rs. 4,17,300 crore (Previous year Rs. 5,05,152 crore).

Annual Report 2008-09 1 MAGNUM TAXGAIN SCHEME

SBI MUTUAL FUND’S PERFORMANCE SBI Mutual Fund saw a total inflow of Rs. 2,51,548 crore (Previous year Rs. 1,12,065 crore) in the domestic open and close-ended funds during the year. The inflows took place predominantly in the liquid and debt funds. The total redemption amounted to Rs. 2,49,439 crore (Previous year Rs. 1,05,487 crore), leaving a net inflow of Rs. 2,109 crore as against a net inflow of Rs. 6,578 crore in the previous year. SBI Mutual Fund had a positive net inflow of Rs. 2,315 crore as against a net outflow of Rs. 28,296 crore for the industry during the year. Based on average assets under management, SBI Mutual Fund had a market share of 5.15% during 2007-08 which has gone up to 5.52% during 2008- 09. (Source: AMFI website). The average assets under management, which were Rs. 25,302 crore for 2007-08, increased to Rs. 27,846 crore during 2008-09. During the year, SBI Mutual Fund launched nineteen funds under SBI Debt Fund Series. The schemes received good response from the investors and total funds mobilized under these schemes amounted to Rs 15,109 crore. The first Exchange Traded Fund by SBI Mutual Fund namely SBI Gold Exchange Traded Scheme was also launched in March, 2009 which has closed for subscription on 28th April, 2009 and mobilized Rs. 113 crore. During the year, the number of AMFI certified Agents selling SBI Mutual Fund products increased to 29,367 as on 31st March, 2009 from 17,109 as on 31st March, 2008. The number of AMFI certified employees in State Bank Group increased to 13,248 as on 31st March, 2009 from 6,150 as on 31st March, 2008. During the year, 2 Investor Service Centres, 5 Investor service Desks and 4 Investor Service Points were added. As on 31st March, 2009, SBI Mutual Fund had 30 Investor Service Centres, 48 Investor Service Desks, 7 Investor Service Points and two Overseas Points of presence. As on 31st March, 2009, the number of Business Associates increased to 73 from 38 as on 31st March, 2008 to improve customer service and provide more contact points to the investors. To improve our quality of customer service and operational efficiency, we have put in place the following initiatives during the year: a) Introduction of centralized direct debits through SBI CMP for all investors banking with SBI core banking branches to give a major boost to Systematic Investment Plans (SIP) business. b) Introduction of internet and telephone based transactions by use of PIN number. Investors are now able to do several financial and some non financial transaction through this process. c) Reduction of “at par” warrants and replacing them with Direct Credits and ECS as a risk mitigation process. The “at par” warrants now have several additional security features. Further, since the warrant masters are uploaded on SBI’s Core Banking System, the instances of misuse of warrants have declined substantially. d) Redemptions and income distribution through direct credits with over forty six banks including SBI core banking branches, which account for about 85% of daily pay-outs. We are running campaigns to convert investors’ non-core bank mandates to core banking mandates in a phased manner. FUTURE PLANS SBI Mutual Fund plans to augment its distribution network to tier 3 towns and extend the market coverage in rural markets through SBI’s business correspondents/facilitators with Micro SIP options. The Micro SIP launched in April, 2009 will give an option to the small investors to invest as low as Rs. 100 per SIP and will be an important step towards financial inclusion. The other steps for improving investor services include increasing the electronic payout of redemption/ dividends to around 90%, introduction of centralized management of SIPs of all associate banks by direct debits to further increase our SIP reach and improve efficiency and fine tuning of our Contact Centre services to reduce call waiting time. AWARDS The Directors are pleased to inform that SBI Mutual Fund has received the ‘Best Equity Fund House-Runner Up Award’ instituted by Outlook Money - NDTV Profit Awards 2008. In addition, the various schemes of SBI Mutual Fund won three awards for their performance during the year as follows: ICRA MUTUAL FUND AWARDS 2009 Scheme Name Category Award Period Magnum Tax Gain Scheme 93 Open Ended Equity Linked Savings Schemes (ELSS) 5 Star Fund 3 years

LIPPER FUND AWARDS - INDIA 2009 Scheme Name Category Period Magnum Balanced Fund (Dividend) Equity India 5 Years Magnum Sector Funds Umbrella-Contra Fund-Dividend Mixed Assets INR Aggressive 5 years Summary of Unclaimed Dividends & Redemptions has been reported in Notes to Accounts. Perspective historical 'Per Unit' statistics of all Schemes has been incorporated in the end of full annual report. SBI Mutual Fund (MF) was set up as a Trust by the Settlers, State Bank of India on June 29, 1987 with SBI Mutual Fund Trustee Company Private Limited as the Trustee (the Trustee Company) as a Trustee in accordance with the provisions of the Indian Trust Act, 1882 and is duly registered under the Indian Registration Act, 1908. The Trustee has entered into an Investment Management Agreement on May 14, 1993 and also a supplemental thereto on April 28, 2003 and the same have been replaced by Restated and Amended Investment Management Agreement on December 29, 2004 with SBI Funds Management Private Ltd. (The AMC) to function as the Investment Manager for all the Schemes of SBIMF. SBIMF was registered with SEBI on December 23, 1993 under Registration Code MF-009/93/3. The Trustee is the exclusive owner of the Trust fund & holds the same in trust for the benefit of unit holders. The Trustee has been discharging its duties and carrying out the responsibilities as provided in the regulations & the trust deed. The trustee seeks to ensure that the fund and the schemes floated there under are managed by the AMC in accordance with the Trust Deed, the Regulations directions and guidelines issued by the SEBI, the Stock Exchanges, the Association of Mutual Funds in India and other regulatory agencies. “The price and redemption value of the units, and income from them, can go up as well as down with the fluctuations in the market value of its underlying investments in securities or fair value in underlying real estate asset, as the case may be”.

Annual Report 2008-09 2 MAGNUM TAXGAIN SCHEME

The Performance of the Schemes as on 31.03.2009 is as under:- Name of Scheme Unit NAV Type Half 1 year 3 years 5 years Since as on year Returns Returns Returns Launch 31/03/09 Returns of the (Rs.) Scheme DEBT OR DEBT ORIENTED SCHEMES GILT SCHEMES SBI Magnum Gilt LTP - Growth 18.9843 Gilt 2.54 4.39 5.16 3.38 8.09 SBI Magnum Gilt LTP - PF - Fixed Period - 1 year - Growth 11.9820 Gilt 2.32 3.93 5.04 3.26 3.61 SBI Magnum Gilt LTP - PF - Fixed Period - 2 year - Growth 11.8727 Gilt 2.24 3.77 4.58 2.94 3.43 SBI Magnum Gilt LTP - PF - Fixed Period - 3 year - Growth 11.7158 Gilt 2.17 3.62 4.43 2.81 3.16 SBI Magnum Gilt LTP - PF - Regular - Growth 12.1584 Gilt 2.58 4.46 5.27 3.55 3.89 I-SEC-LI-BEX 17.2211 14.9851 9.9100 6.2936 6.5200 SBI Magnum Gilt STP - Growth 18.0871 Gilt 7.98 11.07 8.59 6.28 7.42 I-SEC-SI-BEX 8.5320 12.2924 9.0272 7.0912 N.A. LIQUID SCHEMES SBI Magnum Insta Cash - Cash Plan 19.6477 Liquid 3.93 8.44 7.72 6.65 7.06 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 N.A. SBI Magnum Insta Cash Fund - Liquid Floater Plan - Growth 15.2167 Liquid 4.45 8.72 7.94 6.74 6.65 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 5.9400 SBI Premier Liquid Fund - IP - Growth 14.1409 Liquid 3.78 8.21 7.65 6.70 6.5500 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 6.1700 DEBT SCHEMES SBI Magnum Children Benefit Plan 17.8362 Debt (0.72) (1.63) 3.84 6.18 8.43 CRISIL MIP BLENDED INDEX 2.9848 0.4983 5.6265 6.0570 (1.4100) SBI Magnum Income - FRP - LT - Growth 13.2824 Debt 5.38 7.28 7.07 N.A. 6.25 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 6.4800 SBI Magnum Income - FRP - ST - Growth 13.4589 Debt 6.29 9.14 7.48 N.A. 6.60 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 6.4800 SBI Magnum Income - Growth 21.2434 Debt 3.60 2.08 3.95 2.81 7.45 CRISIL COMPOSITE BOND INDEX 7.2822 7.3541 6.4176 4.5178 N.A. SBI Magnum Income Plus Fund - Investment Plan - Growth 13.5542 Debt 0.23 (1.43) 3.52 5.86 5.85 CRISIL MIP BLENDED INDEX 2.9848 0.4983 5.6265 6.0570 6.3100 SBI Magnum Income Plus Fund - Savings Plan - Growth 10.5064 Debt 0.95 (0.67) 0.82 0.72 0.96 CRISIL COMPOSITE BOND INDEX 7.2822 7.3541 6.4176 4.5178 4.4800 SBI Magnum MIP - Floater - Growth 11.4117 Debt 3.1300 (1.4500) 3.2200 N.A. 3.8000 CRISIL MIP BLENDED INDEX 2.9848 0.4983 5.6265 6.0570 6.2400 SBI Magnum MIP - Growth 16.6875 Debt (4.5600) (6.1000) 2.0700 4.2000 6.7000 CRISIL MIP BLENDED INDEX 2.9848 0.4983 5.6265 6.0570 N.A. SBI Magnum NRI Investment Fund - Long Term Bond Plan - Growth 10.5545 Debt (0.15) (3.34) 0.77 1.10 1.2500 CRISIL COMPOSITE BOND INDEX 7.2822 7.3541 6.4176 4.5178 4.6000 SBI Magnum NRI Investment Fund - Short Term Bond Plan - Growth 10.9387 Debt 0.22 1.12 1.14 1.66 1.6700 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 6.2700 SBI SHF - Short Term - Institutional - Growth 10.0487 Debt N.A. N.A. N.A. N.A. 0.38 SBI SHF - Short Term - Retail - Growth 11.4943 Debt 6.16 9.76 N.A. N.A. 8.7400 CRISIL COMPOSITE BOND INDEX 7.2822 7.3541 6.4176 4.5178 4.6000 SBI SHF - Ultra Short Term - IP - Growth 11.4558 Debt 4.04 8.61 N.A. N.A. 8.4200 SBI SHF - Ultra Short Term - Retail - Growth 11.3639 Debt 3.82 8.16 N.A. N.A. 7.9100 CRISIL LIQUID FUND INDEX 4.6648 8.8065 7.5624 6.3316 4.6000 SBI Capital Protection Oriented Fund - Series I - Growth 9.8906 Debt 4.6500 1.6900 N.A. N.A. (1.5927) CRISIL MIP BLENDED INDEX 2.2370 (0.1476) 5.7764 6.1944 0.5927 SBI Debt Fund Series - 13 Months - Dec 2007 - IP - Growth 10.9916 Debt N.A. N.A. N.A. N.A. 9.1200 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 8.7500 SBI Debt Fund Series - 18 Months - 1 - Dec 2006 - Growth 11.3361 Debt N.A. N.A. N.A. N.A. 8.7000 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 4.3900

Annual Report 2008-09 3 MAGNUM TAXGAIN SCHEME

Name of Scheme Unit NAV Type Half 1 year 3 years 5 years Since as on year Returns Returns Returns Launch 31/03/09 Returns of the (Rs.) Scheme SBI Debt Fund Series - 18 Months - Oct 2007 - IP - Growth 11.2409 Debt 7.4000 9.0400 N.A. N.A. 12.3600 SBI Debt Fund Series - 18 Months - Oct 2007 - Ret - Growth 11.2164 Debt 7.2600 8.8000 N.A. N.A. 12.1200 CRISIL COMPOSITE BOND INDEX 7.4894 7.3386 N.A. N.A. 6.8400 SBI Debt Fund Series - 15 Months - 2 - Jan 2007 - Growth 11.1660 Debt N.A. N.A. N.A. N.A. 9.3300 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 6.0700 SBI Debt Fund Series - 15 Months - 3 - Feb 2007 - Growth 11.2549 Debt N.A. N.A. N.A. N.A. 9.8300 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 6.9000 SBI Debt Fund Series - 13 Months - 3 - March 2007 - Growth 11.2072 Debt N.A. N.A. N.A. N.A. 11.1600 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 7.2100 SBI Debt Fund Series - 13 Months - 4 - March 2007 - Growth 11.1958 Debt N.A. N.A. N.A. N.A. 10.9900 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 7.3900 SBI Debt Fund Series - 13 Months - 5 - Aug 2007 - IP - Growth 10.9875 Debt N.A. N.A. N.A. N.A. 9.0600 SBI Debt Fund Series - 13 Months - 5 - Aug 2007 - Ret - Growth 10.9735 Debt N.A. N.A. N.A. N.A. 9.0600 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. 4.1100 SBI Debt Fund Series - 24 Months - May 2007 - Growth 11.8607 Debt 5.6400 9.1400 N.A. N.A. 18.4500 CRISIL COMPOSITE BOND INDEX 7.4894 7.3386 N.A. N.A. N.A. SBI Debt Fund Series - 13 Months - Aug 2008 - 8 - IP - Growth 10.7034 Debt 6.0900 N.A. N.A. N.A. 7.0300 SBI Debt Fund Series - 13 Months - Aug 2008 - 8 - Ret - Growth 10.6566 Debt 5.6900 N.A. N.A. N.A. 6.5700 CRISIL COMPOSITE BOND INDEX 7.4900 N.A. N.A. N.A. 8.2700 SBI Magnum DFS - 13 Months - 9 - IP - Growth 10.0371 Debt N.A. N.A. N.A. N.A. 0.3700 CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. N.A. SBI Debt Fund Series - 13 Months - Mar 2008 - 7 - IP - Growth 11.1677 Debt 6.8600 11.3900 N.A. N.A. 11.6400 SBI Debt Fund Series - 13 Months - Mar 2008 - 7 - Ret - Growth 11.1574 Debt 6.7600 11.2900 N.A. N.A. 11.5300 CRISIL COMPOSITE BOND INDEX 7.4900 7.3400 N.A. N.A. 6.9100 SBI Debt Fund Series - 18 Months - Apr 2008 - 3 - IP - Growth 10.9084 Debt 7.8200 N.A. N.A. N.A. 8.9800 SBI Debt Fund Series - 18 Months - Apr 2008 - 3 - Ret - Growth 10.9072 Debt 5.4400 N.A. N.A. N.A. 6.5700 CRISIL COMPOSITE BOND INDEX 7.4900 N.A. N.A. N.A. 6.9100 SBI Debt Fund Series - 370 Days - 1 - Sep 08 - IP - Growth 10.6706 Debt 5.8600 N.A. N.A. N.A. 6.5100 SBI Debt Fund Series - 370 Days - 1 - Sep 08 - Ret - Growth 10.6433 Debt 5.7500 N.A. N.A. N.A. 6.4000 CRISIL COMPOSITE BOND INDEX 7.4900 N.A. N.A. N.A. 7.8600 SBI Debt Fund Series - 370 Days - 2 - Sep 08 - IP - Growth 10.6252 Debt 6.0900 N.A. N.A. N.A. 6.2200 SBI Debt Fund Series - 370 Days - 2 - Sep 08 - Ret - Growth 10.5923 Debt 5.7600 N.A. N.A. N.A. 5.8900 CRISIL COMPOSITE BOND INDEX 7.4894 N.A. N.A. N.A. 7.4800 SBI Debt Fund Series - 180 Days - 08 - Nov 08 Growth 10.4587 Debt N.A. N.A. N.A. N.A. 9.3500 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 4.2100 SBI Debt Fund Series - 30 Days - 04 - Nov08 Growth 10.0740 Debt N.A. N.A. N.A. N.A. 9.0000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 0.8200 SBI Debt Fund Series - 90 Days - 20 - Feb 08 Growth 10.2498 Debt N.A. N.A. N.A. N.A. 10.0200 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 8.2700 SBI Debt Fund Series - 90 Days - 21 - Mar 08 Growth 10.2525 Debt N.A. N.A. N.A. N.A. 10.5200 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 8.1100 SBI Debt Fund Series - 30 Days - 1 - Mar 08 Growth 10.1014 Debt N.A. N.A. N.A. N.A. 11.2200 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 11.0800 SBI Debt Fund Series - 90 Days - 22 - Mar 08 Growth 10.2594 Debt N.A. N.A. N.A. N.A. 10.6400 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 7.6600 SBI Debt Fund Series - 30 Days - 2 - Mar 08 Growth 10.1038 Debt N.A. N.A. N.A. N.A. 13.0400 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 9.6800 SBI Debt Fund Series - 90 Days - 23 - Apr 08 Growth 10.2220 Debt N.A. N.A. N.A. N.A. 9.1000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 6.9100

Annual Report 2008-09 4 MAGNUM TAXGAIN SCHEME

Name of Scheme Unit NAV Type Half 1 year 3 years 5 years Since as on year Returns Returns Returns Launch 31/03/09 Returns of the (Rs.) Scheme SBI Debt Fund Series - 90 Days - 24 - May 08 Growth 10.2194 Debt N.A. N.A. N.A. N.A. 9.0000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 7.2000 SBI Debt Fund Series - 90 Days - 25 - June 08 - Ret - Growth 10.2198 Debt N.A. N.A. N.A. N.A. 8.9100 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 1.8300 SBI Debt Fund Series - 30 Days - 3 - Jul 08 Growth 10.0913 Debt N.A. N.A. N.A. N.A. 10.3000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 8.1200 SBI Debt Fund Series - 90 Days - 26 - July 08 - Ret - Growth 10.2564 Debt N.A. N.A. N.A. N.A. 10.4000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.1900 SBI Debt Fund Series - 90 Days - 27 - Aug 08 - Ret - Growth 10.2619 Debt N.A. N.A. N.A. N.A. 10.0300 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.2200 SBI Debt Fund Series - 90 Days - 28 - Aug 08 - Ret - Growth 10.2742 Debt N.A. N.A. N.A. N.A. 11.1200 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.3600 SBI Debt Fund Series- 90 Days - 29 - Dec08 - Ret - Growth 10.2770 Debt N.A. N.A. N.A. N.A. 11.1100 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.4100 SBI Debt Fund Series - 90 Days - 30 - Jan09 - Ret - Growth 10.2653 Debt N.A. N.A. N.A. N.A. 10.5300 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.5800 SBI Debt Fund Series - 90 Days - 31 - Feb09 - Ret - Growth 10.2619 Debt N.A. N.A. N.A. N.A. 10.5000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.5100 SBI Debt Fund Series - 90 Days - 32 - Feb09 - Ret - Growth 10.2319 Debt N.A. N.A. N.A. N.A. 9.3000 CRISIL LIQUID FUND INDEX N.A. N.A. N.A. N.A. 2.3900 SBI Debt Fund Series - 13 Months - Aug 2008 - 8 - IP - Growth N.A. Debt N.A. N.A. N.A. N.A. N.A. SBI Debt Fund Series - 13 Months - Aug 2008 - 8 - Ret - Growth N.A. Debt N.A. N.A. N.A. N.A. N.A. CRISIL COMPOSITE BOND INDEX N.A. N.A. N.A. N.A. N.A. EQUITY SCHEMES SBI Magnum Equity Fund Growth 20.54 Equity -22.88 -38.00 N.A N.A. -11.76 Benchmark : BSE100 -26.14 -39.97 N.A. N.A. -13.72 SBI Magnum Equity Fund Dividend 18.06 Equity -22.82 -37.96 -3.79 14.53 12.68 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 13.29 SBI Magnum Multiplier Plus 93 Growth 40.26 Equity -22.09 -35.40 -4.58 N.A. 15.04 Benchmark : BSE100 -26.14 -39.97 -5.75 N.A. 8.76 SBI Magnum Multiplier Plus 93 Dividend 32.65 Equity -22.08 -35.40 -4.57 22.14 11.80 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 9.14 SBI Magnum Taxgain Scheme - 1993 Growth 30.91 Equity Tax Savings -23.53 -39.48 N.A N.A. -18.04 Benchmark : BSE100 -26.14 -39.97 N.A. N.A. -17.19 SBI Magnum Taxgain Scheme - 1993 Dividend 25.12 Equity Tax Savings -23.51 -39.47 -5.48 26.77 16.24 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 10.35 SBI Magnum Global Fund 94 Growth 21.07 Equity -37.60 -53.46 -15.77 N.A. 2.49 Benchmark : BSE100 -26.14 -39.97 -5.75 N.A. 7.29 SBI Magnum Global Fund 94 Dividend 13.91 Equity -37.62 -53.46 -15.76 18.24 8.56 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 6.29 SBI Magnum Balanced Fund Growth 28.82 Balanced -16.58 -29.36 -2.96 N.A. 13.15 Benchmark : Crisil Balanced Fund Index -11.84 -21.53 0.89 N.A. 9.76 SBI Magnum Balanced Fund Dividend 18.64 Balanced -16.61 -29.39 -2.94 16.78 15.03 Benchmark : Crisil Balanced Fund Index -11.84 -21.53 0.89 8.98 N.A SBI Magnum Sector Fund Umbrella - FMCG -7.02 -14.05 -6.81 12.98 5.84 Benchmark : BSE FMCG 12.75 Equity -5.76 -11.08 -2.71 16.61 5.04 SBI Magnum Sector Fund Umbrella - IT -44.20 -56.37 -21.51 5.39 4.34 Benchmark : BSE IT 8.03 Equity -26.15 -35.57 -17.21 6.17 6.15 SBI Magnum Sector Umbrella - Pharma Growth 17.59 Equity -33.74 -38.42 -20.93 N.A. -5.30 Benchmark : BSE-HC -22.93 -26.45 -9.80 N.A. -1.90 SBI Magnum Sector Umbrella - Pharma Dividend 14.51 Equity -33.59 -38.28 -20.89 4.49 8.83 Benchmark : BSE-HC -22.93 -26.45 -9.80 4.53 8.47 SBI Magnum Sector Fund Umbrella - Contra Growth 29.67 Equity -20.01 -35.01 -2.75 N.A. 16.22 Benchmark : BSE100 -26.14 -39.97 -5.75 N.A. 9.39

Annual Report 2008-09 5 MAGNUM TAXGAIN SCHEME

Name of Scheme Unit NAV Type Half 1 year 3 years 5 years Since as on year Returns Returns Returns Launch 31/03/09 Returns of the (Rs.) Scheme SBI Magnum Sector Fund Umbrella - Contra Dividend 16.89 Equity -19.99 -34.99 -2.74 27.59 23.40 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 10.58 SBI Magnum Index Fund Growth 25.8285 Equity -23.08 -37.88 -5.38 9.79 14.08 Benchmark : S&P Nifty -22.96 -36.19 -3.88 11.25 14.92 SBI Magnum NRI Investment Fund - Flexi Asset Plan Growth 16.5839 Equity -20.17 -34.65 -9.81 11.20 10.12 Benchmark : BSE100 -26.14 -39.97 -5.75 10.74 8.42 Benchmark : Crisil Balanced Fund Index -11.84 -21.53 0.89 8.98 7.92 Benchmark : Crisil Composite Bond Fund Index 7.28 7.35 6.42 4.52 4.49 SBI Magnum Sector Umbrella - Emerging Businesses Fund Growth 13.80 Equity -38.37 -58.04 -20.62 N.A. 7.36 Benchmark : BSE 500 -28.06 -42.77 -7.94 N.A. 10.45 SBI Magnum Midcap Fund Growth 9.92 Equity -40.19 -59.32 -19.59 N.A. -0.23 Benchmark : CNX Midcap -30.33 -45.40 -10.70 N.A. 4.69 SBI Magnum COMMA Fund Growth 12.82 Equity -22.81 -38.21 -3.38 N.A. 6.91 Benchmark : BSE200 -26.69 -40.98 -6.88 N.A. 3.95 SBI Magnum Multi Cap Fund Growth 9.66 Equity -25.41 -41.77 -11.54 N.A. -0.98 Benchmark : BSE100 -26.14 -39.97 -5.75 N.A. 2.28 SBI Magnum Bluechip Fund Growth 7.65 Equity -20.97 -37.96 -10.74 N.A. -8.21 Benchmark : BSE100 -26.14 -39.97 -5.75 N.A. -2.36 SBI Arbitrage Opportunities Fund Growth 12.0956 Equity 3.67 6.84 N.A. N.A. 8.54 Benchmark : Crisil Liquid Fund Index 4.66 8.81 N.A. N.A. 7.91 SBI One India Fund Growth 5.47 Equity -29.96 -44.75 N.A. N.A. -23.96 Benchmark : BSE200 -26.69 -40.98 N.A. N.A. -16.63 SBI Infrastructure Fund - Series I Growth 5.65 Equity -29.55 -47.34 N.A. N.A. -28.01 Benchmark : BSE100 -26.14 -39.97 N.A. N.A. -22.79 SBI Tax Advantage Fund - Series 1 Growth 6.09 Equity Tax Savings -29.43 N.A. N.A. N.A. -40.30 Benchmark : BSE100 -26.14 N.A. N.A. N.A. -39.97 N.A. = Not Applicable. The date of schemes redeemed during the year are as of redemption date. OBJECTIVES AND INVESTMENT POLICY OF THE SCHEME Launch Date : February 24, 1993 Growth Option- May 7, 2007 Objective : An open-ended equity linked savings scheme. The objective of the scheme is a) Deliver the benefit of investment in a portfolio of equity shares, while offering deduction on such investments made in the scheme under section 80C of the Income Tax Act, 1961. b) Distribute income periodically depending on distributable surplus‘. Magnum Taxgain delivers the benefit of investment in a portfolio of equity shares, while offering tax rebate on such investments made in the scheme under Sec 80C of the Income Tax Act, 1961. The portfolio strategy is to make long term investments in stocks consistent with the average duration of investor funds. To invest in companies in all the market cap segments through both top down and bottom up investment philosophies. To invest in companies with sustainable & scalable business models which can lead to significant out-performance in the long run. As on 31.03.09 Unit NAV: Dividend Option : Rs. 25.12 Growth Option : Rs. 30.91 Corpus : Rs. 1,069.43 crores Total assets under management: Rs. 2,820.87 crores.

Annual Report 2008-09 6 MAGNUM TAXGAIN SCHEME

STATUTORY DETAILS

SBI Mutual Fund has been set up as a trust under the Indian Trusts Act, 1882. State Bank of India (SBI), the sponsor is not responsible or liable for any loss resulting from the operation of the schemes beyond the initial contribution of an amount of Rs 5 lacs made by it towards setting up of the mutual fund. LIABILITY AND RESPONSIBILITY OF TRUSTEE AND SETTLOR The main responsibility of the Trustee is to safeguard the interest of the Unit holders and inter-alia ensure that SBI Funds Management Pvt Ltd (SBIFM) functions in the interest of the investors and in accordance of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, the provisions of the Trust Deed and the offer documents of the respective schemes. From the information provided to the Trustee and the reviews the Trustee has undertaken, the Trustee believes SBIFM has operated in the interest of the Unit holders. The settlor is not responsible or liable for any loss or shortfall resulting from the operation of the Schemes beyond the initial contribution of Rs 5 lacs made by it towards setting of SBI Mutual Fund. ACKNOWLEDGEMENT The Directors take this opportunity to express their gratitude for the continued support and co-operation extended by the State Bank of India, Société Générale Asset Management, the Registrars & Transfer Agents, the Custodians, the Collecting Banks, Government Agencies, Auditors, SEBI, AMFI, the Board of Directors of SBI Funds Management Private limited, market intermediaries and the large body of investors in various schemes of the Fund. Full Annual Report shall be disclosed on the website www.sbimf.com and shall be available for inspection at the Head Office of the mutual fund. Present and prospective unit-holder can obtain the copy of trust deed and the full Annual Report of the Fund/AMC at a price.

For and on behalf of the Board of Directors SBI Mutual Fund Trustee Company Pvt. Ltd.

Place : Mumbai Dr. Malati Anagol Date : 18th July, 2009 (Chairperson)

Annual Report 2008-09 7 MAGNUM TAXGAIN SCHEME

FINANCIAL STATEMENTS — MARCH 31, 2009 TOGETHER WITH AUDITOR'S REPORT To the Board of Directors of SBI MUTUAL FUND TRUSTEE COMPANY PRIVATE LIMITED - MAGNUM TAXGAIN SCHEME 1. We have audited the attached Balance Sheet as at March 31, 2009, the Revenue Account and the Cash Flow Statement for the year ended on that date annexed thereto of Magnum Taxgain Scheme 1993 (The scheme) of the SBI Mutual Fund (The Fund). These financial statements are the responsibility of the Managements of the Trustee and the Asset Management companies. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with generally accepted auditing standards in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. We report that: i. We have obtained all information and explanations, which, to the best of our knowledge and belief were necessary for the purpose of our audit. ii. The Balance Sheet, the Revenue Account and Cash Flow Statement dealt with by this report are in agreement with the books of account of the Scheme. iii. In our opinion, valuation methods for Non Traded Securities, adopted by the scheme are fair and reasonable and are in accordance with the guidelines for valuation issued by Securities and Exchange Board of India and approved by the Trustees. iv. The Balance Sheet and the Revenue Account dealt with by this report have been prepared in accordance with the accounting policies and standards adopted by the trustees of the Fund and as specified in the Ninth Schedule to the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996. v. In our opinion and to the best of our information and according to the explanations given to us, the said accounts read together with the notes thereon, give the information required by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in the case of Balance Sheet, of the state of affairs of the scheme as at March 31, 2009; (b) in the case of Revenue Account, of the deficit of the scheme for the year ended on March 31, 2009; and (c) in the case of Cash Flow Statement, of the cash flow of the scheme for the year ended on March 31, 2009.

FOR M. M. NISSIM AND CO. Chartered Accountants

Place : Mumbai Sanjay Khemani Date : July 18, 2009 (Partner) Membership No.: 44577

Annual Report 2008-09 8 MAGNUM TAXGAIN SCHEME

BALANCE SHEET AS AT MARCH 31, 2009 Schedule As at As at March 31, 2009 March 31, 2008 Rupees Rupees

LIABILITIES Unit Capital A 10,694,261,497 7,553,544,219 Reserves and Surplus B 22,767,689,121 20,761,805,748 Unrealised Appreciation in Value of Investments - 4,090,710,801 Unitholders’ Fund 33,461,950,618 32,406,060,768

Load Carried Forward 10,638,952 - Current Liabilities and Provisions C 838,372,028 491,480,862

Total 34,310,961,598 32,897,541,630

ASSETS Investments D 26,476,822,484 30,939,446,962 Deposits E 500,000,000 - Other Current Assets F 2,080,905,051 1,958,094,668 Deficit in Revenue Account 5,253,234,063 - Total 34,310,961,598 32,897,541,630

Per unit Net Asset Value Refer to notes to accounts

Significant Accounting Policies and Notes to Accounts G

This is the Balance Sheet referred to in our report of even date FOR M.M. NISSIM AND CO. FOR SBI MUTUAL FUND TRUSTEE CO. PVT. LTD. FOR SBI FUNDS MANAGEMENT PVT. LTD. Chartered Accountants

Sanjay Khemani Dr. Malati Anagol Bharati Rao Achal Kumar Gupta Didier Turpin (Partner) (Chairperson) (Director) (Managing Director) (Dy. CEO) Membership No.: 44577

Rajkumar S. Adukia Ashwini Kumar Jain Jayesh Shroff (Director) (Chief Operating Officer) (Fund Manager)

Place : Mumbai Place : Mumbai Place : Mumbai Date : July 18, 2009 Date : July 18, 2009 Date : July 18, 2009

Annual Report 2008-09 9 MAGNUM TAXGAIN SCHEME

REVENUE ACCOUNT FOR THE YEAR ENDED MARCH 31, 2009 For the For the Year ended Year ended March 31, 2009 March 31, 2008 Rupees Rupees INCOME Dividend 316,946,723 157,249,137 Interest 335,069,373 274,285,366 Profit on sale/redemption of investments (net) (other than inter scheme) - 821,778,590 Profit on inter-scheme transfer/sale of investments (net) - 665,644,365 Profit on derivative transactions (net) - 23,557,405 Provision for accrued income, investments and debtors, no longer required, written back 811,972 1,027,476 Total 652,828,068 1,943,542,339

EXPENSES AND LOSSES Loss on sale/redemption of investments (net) (other than inter scheme) 1,015,254,304 - Loss on inter-scheme transfer/sale of investments (net) 34,560,726 - Provision for Doubtful Debt, Income, Deposits 39,485 - Management fees 195,340,701 161,535,587 Service Tax on Management Fees 23,975,715 - Trusteeship fees 3,128,173 2,733,746 Commission to agents (net of load utilised) 171,850,602 161,759,513 Publicity expenses 4,589,451 3,654,689 Audit fees 283,031 218,053 Other operating expenses 6,402,006 35,388,430 Custodian charges 9,477,769 10,616,200 Registrar’s fees 106,132,711 133,026,285 Total 1,571,034,674 508,932,503

Net realised Gains/(Losses) for the year (918,206,606) 1,434,609,836 Change in unrealised depreciation in value of investments (9,107,061,967) - Net Gains/(Losses) for the year (10,025,268,573) 1,434,609,836 Change in unrealised appreciation in value of investments (4,090,710,801) 1,296,709,505 Net Surplus/(Deficit) for the year (14,115,979,374) 2,731,319,341 Add: Amount transferred from Unrealised Appreciation Reserve 4,090,710,801 - Less: Amount transferred to Unrealised Appreciation Reserve - (1,296,709,505) Add/(Less): Amount transferred from/ (to) Equalisation Reserve 3,555,315,304 5,918,145,524 Surplus brought forward 1,217,040,636 - Surplus / (Deficit) available for appropriation (5,252,912,633) 7,352,755,360 Appropriations Income distribution 321,430 6,135,714,724 Surplus/(Deficit) carried forward (5,253,234,063) 1,217,040,636

Significant Accounting Policies and Notes to Accounts G

This is the Revenue Account referred to in our report of even date FOR M.M. NISSIM AND CO. FOR SBI MUTUAL FUND TRUSTEE CO. PVT. LTD. FOR SBI FUNDS MANAGEMENT PVT. LTD. Chartered Accountants

Sanjay Khemani Dr. Malati Anagol Bharati Rao Achal Kumar Gupta Didier Turpin (Partner) (Chairperson) (Director) (Managing Director) (Dy. CEO) Membership No.: 44577

Rajkumar S. Adukia Ashwini Kumar Jain Jayesh Shroff (Director) (Chief Operating Officer) (Fund Manager)

Place : Mumbai Place : Mumbai Place : Mumbai Date : July 18, 2009 Date : July 18, 2009 Date : July 18, 2009

Annual Report 2008-09 10 MAGNUM TAXGAIN SCHEME

CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31 2009 March 31, 2009 March 31, 2008 Rupees Rupees A. Cashflow from Operating Activity Net Gain/(Loss) for the year (14,115,979,374) 2,731,319,341 Change in unrealised depreciation in value of investments (9,107,061,967) - Change in unrealised appreciation in value of investments (4,090,710,801) 1,296,709,505 Provision for accrued income, investments and debtors, no longer required, written back (811,972) (1,027,476) Provision for Doubtful Debt, Income, Deposits 39,485 -

Operating Profit/(Loss) Before Working Capital Changes (27,314,524,629) 4,027,001,370 Adjustments for:- (Increase)/Decrease in Other Current Assets 179,625,482 (2,167,224) (Increase)/Decrease in Investments 17,660,397,246 (20,002,669,113) Increase/(Decrease) in Current Liabilities and Provisions 397,758,083 79,379,939

Net Cash Generated From/(Used in) Operations (A) (9,076,743,818) (15,898,455,028)

B. Cashflow from Financing Activities Increase/(Decrease) in Unit Corpus 3,140,717,278 3,481,260,605 Increase/(Decrease) in Unit Premium/ Equalisation reserve 6,778,239,313 15,055,435,999 Increase/(Decrease) in Load 10,638,952 - Outstanding Receivable/Payables for Unit Corpus 418,075,723 87,716,257 Dividend Paid during the year (56,091,440) (6,197,402,326)

Net Cash Generated From/(Used in) Financing Activities (B) 10,291,579,826 12,427,010,535

Net Increase/(Decrease) in Cash & Cash Equivalents (A+B) 1,214,836,008 (3,171,444,493)

Cash and Cash Equivalents as at the beginning of the year 662,069,538 3,833,514,031 Cash and Cash Equivalents as at the close of the year 1,876,905,546 662,069,538

Net Increase/(Decrease) in Cash & Cash Equivalents 1,214,836,008 (3,171,444,493)

Components of cash and cash equivalents With Banks - on current account 357,357,459 511,472,980 Money at Call with Institutions 1,019,548,087 150,596,558 With Banks - Fixed Deposits 500,000,000 -

1,876,905,546 662,069,538

This is the Cash Flow Statement referred to in our report of even date FOR M.M. NISSIM AND CO. FOR SBI MUTUAL FUND TRUSTEE CO. PVT. LTD. FOR SBI FUNDS MANAGEMENT PVT. LTD. Chartered Accountants

Sanjay Khemani Dr. Malati Anagol Bharati Rao Achal Kumar Gupta Didier Turpin (Partner) (Chairperson) (Director) (Managing Director) (Dy. CEO) Membership No.: 44577

Rajkumar S. Adukia Ashwini Kumar Jain Jayesh Shroff (Director) (Chief Operating Officer) (Fund Manager)

Place : Mumbai Place : Mumbai Place : Mumbai Date : July 18, 2009 Date : July 18, 2009 Date : July 18, 2009

Annual Report 2008-09 11 MAGNUM TAXGAIN SCHEME

SCHEDULES ANNEXED TO AND FORMING PART OF THE BALANCE SHEET AS AT MARCH 31, 2009

As at March 31, 2009 As at March 31, 2008 Rupees Rupees Dividend Growth Total Dividend Growth Total SCHEDULE A UNIT CAPITAL INITIAL CAPITAL 739,583,000 - 739,583,000 739,583,000 - 739,583,000

ISSUED AND SUBSCRIBED (Face Value) (Units of Rs10/- each fully paid up) Outstanding at the beginning of the year 6,436,098,763 1,117,445,456 7,553,544,219 4,072,283,614 - 4,072,283,614 Add :Magnums reissued during the year 2,005,729,548 1,202,705,892 3,208,435,440 2,100,202,900 1,117,445,456 3,217,648,356 Add : Dividend reinvested during the year (137,451) - (137,451) 272,245,043 - 272,245,043 Less:Magnums repurchased during the year 67,479,972 100,739 67,580,711 8,632,794 - 8,632,794 Outstanding at the end of the year 8,374,210,888 2,320,050,609 10,694,261,497 6,436,098,763 1,117,445,456 7,553,544,219

ISSUED AND SUBSCRIBED (in Units) Outstanding Units at the beginning of the year 643,609,876 111,744,546 755,354,422 407,228,361 - 407,228,361 Add :Magnums reissued during the year 200,572,955 120,270,589 320,843,544 210,020,290 111,744,546 321,764,836 Add : Dividend reinvested during the year (13,745) - (13,745) 27,224,504 - 27,224,504 Less:Magnums repurchased during the year 6,747,997 10,074 6,758,071 863,279 - 863,279 Outstanding Units at the end of the year 837,421,089 232,005,061 1,069,426,150 643,609,876 111,744,546 755,354,422

As at As at March 31, 2009 March 31, 2008 Rupees Rupees SCHEDULE B RESERVES AND SURPLUS MAGNUM PREMIUM RESERVE Opening Balance 9,137,290,475 - Premium on magnums repurchased / reissued during the year (net) 3,222,924,009 15,055,435,999 Add/ (Less): Amount transferred from/ (to) Equalisation Reserve - (5,918,145,524) Closing Balance 12,360,214,484 9,137,290,475

GENERAL RESERVE Opening Balance 10,407,474,637 10,407,474,637 Closing Balance 10,407,474,637 10,407,474,637

EQUALISATION RESERVE Additon/ (deletion) on magnums repurchased / reissued during the year (net) 3,555,315,304 5,918,145,524 Add/ (Less): Amount transferred from/ (to) Revenue Account (3,555,315,304) (5,918,145,524) Closing Balance - -

REVENUE ACCOUNT - 1,217,040,636 Total 22,767,689,121 20,761,805,748

Annual Report 2008-09 12 MAGNUM TAXGAIN SCHEME

As at As at March 31, 2009 March 31, 2008 Rupees Rupees SCHEDULE C CURRENT LIABILITIES AND PROVISIONS CURRENT LIABILITIES Management fees payable 6,049,268 - Trusteeship fees payable 208,273 251,617 Magnum repurchases/ redemption payable 10,978,343 6,075,250 Contract for purchase of investments 607,346,182 142,649,024 Bank account overdrawn as per books 412,391 79,740 Amount payable to other schemes 1,388,312 - Unclaimed distributed Income 102,495,275 158,265,285 Other liabilities 109,493,984 184,159,946 Total 838,372,028 491,480,862

SCHEDULE D INVESTMENTS (i) Listed Equity shares 22,346,997,266 26,065,366,307 Equity linked instruments 11,317,704 25,627,819 (ii) Securities awaiting listing Equity shares - 917,726 (iii) Unlisted securities Non convertible debentures/ bonds 250,000,000 - (iv) Commercial Paper 1,959,034,300 2,385,662,054 (v) Certificate of Deposits 1,909,473,214 2,461,873,056 Total 26,476,822,484 30,939,446,962

NOTE The investments are net of appreciation/(depreciation) in (i) Listed Equity shares (9,081,447,444) 4,089,285,954 Equity linked instruments (25,614,524) 1,424,841 (ii) Securities awaiting listing Equity shares - 6

Total Appreciation - 4,090,710,801 (Total Depreciation) (9,107,061,968) -

SCHEDULE E DEPOSITS Deposits with Scheduled banks 500,000,000 - Total 500,000,000 -

Out of the above, deposit for derivative margin - - SCHEDULE F OTHER CURRENT ASSETS Balances with banks in current accounts 357,357,459 511,472,980 Placement under Collateralised Borrowing and Lending Obligation/ Reverse Repo Lending 1,019,548,087 150,596,558 Outstanding and accrued income 9,244,600 2,416,182 Application money receivable 692,725,107 1,105,897,737 Share Application money, pending allotment - 143,100,000 Contract for sale of investments - 6,709,533 Amount receivable from AMC 564,863 35,763,593 Amount receivable from Other Scheme 1,344,479 522,500 Other current assets 120,456 1,615,585 Total 2,080,905,051 1,958,094,668

Annual Report 2008-09 13 MAGNUM TAXGAIN SCHEME

SCHEDULES ANNEXED TO AND FORMING PART OF THE BALANCE SHEET AS AT MARCH 31, 2009 AND THE REVENUE ACCOUNT FOR THE YEAR ENDED ON THAT DATE SCHEDULE G : SIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS A. BACKGROUND SBI Mutual Fund – Magnum Tax Gain Scheme, 1993 (‘The scheme’) was launched on February 24, 1993 as a close ended scheme. The Objective of the Scheme is to provide investors capital appreciation through investment of at least 80 percent of its corpus in, inter alia, equity shares and convertible debentures. The Scheme has been approved as a tax saving scheme to provide tax benefit under Section 88 C of the Income- tax Act, 1961 for initial investments up to Rs.100,000. Investment in this scheme would be subject to statutory lock-in-period 3 years from the date of investment to avail section 80C benefit. The Scheme was initially launched for a period of ten years ending March 31, 2003. By its notification number S.O.1092 (E) dated December 22, 1998, the ministry of Finance, Government of India permitted a mutual fund to operate an open ended equity linked saving plan. Accordingly, on May 22, 1999, the Board of Trustee (‘The Trustees’) of SBI Mutual Fund (‘The Fund’) approved the conversion of the Scheme into an open ended load scheme with effect from November 11, 1999. The SBI Mutual Fund Trustee Company Private Limited (‘The Trustees’) of SBI Mutual Fund (‘The Fund’) has appointed SBI Funds Management Private Limited (‘The AMC’), a subsidiary of the State Bank of India (‘SBI’), to manage the Fund’s affairs and operate its schemes. SBI is the main banker to the Fund’s schemes. B. SIGNIFICANT ACCOUNTING POLICIES 1. The financial statements are prepared under the historical cost convention and on the accrual basis as modified for investments which are ‘marked- to market’. 2. Income Recognition a. Dividend income is accrued on ex-dividend date. b. Profit or loss on sale of investments/square off of derivative contract/inter scheme transfer is recognised on trade date except in respect of inter scheme investments, which is recognised on the next working day. The cost of investments sold is determined on “weighted average cost basis”. c. Unrealised appreciation/depreciation, on marking the investments and derivative contracts to market is recognised on the balance sheet date and accordingly reckoned for determination of net surplus/deficit for the period. d. Interest on interest bearing and other fixed income investments is recognised on a day to day basis as it earned. On purchase of such investments, interest paid for the period from the last interest due date up to the date of purchase is not treated as a cost of purchase but is treated as interest recoverable. Similarly, interest received at the time of sale for the period from the last interest due date up to the date of sale is not treated as part of sale value but is treated as interest recovered. e. Where interest on investment in fixed income securities has not been received for a period of one quarter beyond the due date, no further income is accrued on such investments and the interest previously accrued is fully provided for. f. Other income of miscellaneous nature is accounted for when there is certainty of collection. 3. Expenses a. All expenses are accounted on an accrual basis. b. Expenses not identifiable with any particular scheme are allocated to the schemes in a systematic manner. c. Expenses other than management fees are disclosed inclusive of service tax. 4. Deferred Revenue Expenditure In respect of open ended schemes launched prior to April 4, 2006 and close ended schemes launched prior to January 31, 2008, the initial issue expenses borne by the Scheme are treated as Deferred Revenue Expenditure and is amortised on a straight line basis over a period of not exceeding five years for open ended schemes and over the tenor of scheme in respect of close ended scheme from the commencement of the scheme. In case of repurchase of Magnums, the proportionate share of unamortised deferred revenue expenditure is recovered from the Magnum holder. No initial issue expenses are borne by the scheme in respect of schemes launched after these dates. 5. Investments a. Investments are accounted on trade date except for inter scheme investments, which are accounted on the next working day and off market transactions including subscriptions are accounted when scheme obtains the enforceable Obligation/right. b. Cost of investments includes brokerage, stamps fees, transaction charges, Securities Transaction Tax and any other charge customarily included in the broker’s note except in the case of derivative contracts, where such cost is charged off to revenue as incurred. The cost is net of front-end fees and incentives. In case of devolvement, the cost is net of underwriting commission earned. c. Rights entitlements are recognised on ex-right dates. d. Bonus entitlements are recognised on ex-bonus dates. 6. Computation of Net Asset Value The Net Asset Value (NAV) of the Magnums is determined by dividing the net assets, including (a) investments recognised and valued as per the accounting policies and (b) unamortised deferred revenue expenditure relating to initial issue expenses, by the number of outstanding magnums on the valuation date. 7. Portfolio Valuation for NAV computation a. Valuation for Performing Investments: i. For the purpose of the financial statements, the Fund marks all investments to market and carries investments in the Balance Sheet at the market value. ii. Securities other than Central Government Securities, which have been traded during the period of thirty days prior to the valuation date

Annual Report 2008-09 14 MAGNUM TAXGAIN SCHEME

in case of Equity shares or on the valuation date in case of debt securities, are stated at the closing prices quoted on the stock exchange where the securities are principally traded on the valuation date or the last trading day before the valuation date as may be applicable. Securities under dispute are valued at Re 1 per company. iii. Thinly traded/Non-traded/ Unlisted shares are valued in good faith by the Asset Management Company in accordance with guidelines issued by the Securities and Exchange Board of India (SEBI). iv. Thinly traded/ Non-traded Non-Government Debt Securities of up to 182 days of residual maturity are valued on the basis of amortisation (Cost plus accrued interest plus difference between the redemption value and cost, spread uniformly over the remaining maturity) as prescribed by SEBI. Securities acquired with residual maturity of over 182 days is also valued on the basis of amortisation after the residual maturity of securities on valuation date is 182 days or less except that the valuation as on the last valuation date before 182 days is substituted instead of cost. v. Thinly traded/ Non-traded Non-Government Debt Securities of over 182 days to residual maturity are valued in good faith in accordance with SEBI guidelines. The valuation of non-traded debt securities is on comparative yield to maturity basis with appropriate credit spread, illiquidity discount/mark up plus discretionary mark up/discount; wherein the benchmark yields and matrix of credit spreads as provided by an independent agency approved by Association of Mutual Funds in India (AMFI) is used. vi. Traded/ Thinly traded/ Non-traded Central Government securities are valued based on prices released by an independent agency approved by AMFI. vii. Derivative contracts are marked to market and appreciation/depreciation on marking to market is treated as unrealised appreciation/ depreciation, as the case may be. b. An investment is regarded as non-performing, if interest/principal amount has not been received or has remained outstanding for one quarter from the day such income/instalment has fallen due. c. Provision for non-performing investment is made three months after such investment has been classified as non-performing and at the rates prescribed by the SEBI. The scheme commences provision after classification as non performing investment in such a manner that the provision prescribed by SEBI is available on the day, when such provision is required to be made as per SEBI guidelines. d. In accordance with the Guidance Note on Accounting for Investments in the financial statements of Mutual Funds issued by the Institute of Chartered Accountants of India (pursuant to the Eleventh Schedule of the SEBI (Mutual Funds) Regulations 1996), net unrealised appreciation or depreciation in value of investments is determined separately for each category of investment. e. The change in net depreciation/appreciation category wise, if any, is recognised in the Revenue Account. The change in net appreciation, if any, is transferred to/from the “Unrealised Appreciation in value of investments” shown as part of Magnum holders’ fund. 8. Income Equalisation a. The purpose of equalisation reserve is to maintain the per magnum amount of plan’s share of the Scheme’s undistributed income earned during the accounting period, so that continuing magnum holders’ share of undistributed income remains unchanged on reissue or repurchase of magnums under that Plan. b. In case of an open ended scheme, when magnums are repurchased / reissued by the Scheme, an appropriate part of the repurchase / reissue price is adjusted against the Magnum Premium Reserve of the scheme after an appropriate part of the reissue proceeds and repurchase consideration being credited or debited respectively to the Equalisation Account. At the balance sheet date, the balance in the equalisation account is transferred to the revenue account. 9. Reissue / Repurchase of Magnums When magnums are reissued / repurchased, after considering the income equalisation as above, the difference between the reissue/repurchase price and the face value of the magnum, is transferred to magnum premium reserve. 10. Provisions Provision is made by charge to the Revenue Account, in respect of: a. Non Performing Investment as per the Guidelines prescribed by SEBI. b. Interest outstanding for more than one quarter beyond the due date. c. Securities where the certificates are not received / traceable for a protracted period. d. Dividend income, which has not been received for a period of twelve months from the due date. e. Assets other than investments, which in the opinion of the Trustee have suffered substantial impairment in their value. 11. Entry and Exit Load Entry load charged at the time of initial issue is utilised towards meeting distribution and marketing expenses. Load charged at the time of repurchase and reissue of magnums is utilised towards meeting distribution and marketing expenses, namely, commission to agents and publicity expenses. Any surplus/ unutilised amount of Load collected are carried forward as liability for utilisation in subsequent periods unless the same is considered excess by the Trustee. Such excess income is credited to other income. C. NOTES TO ACCOUNTS Amount in Rupees in Lakhs unless and otherwise stated 1. Net Asset Value per Magnum (NAV): NAV per magnum are as under: Options As at 31st March 2009 As at 31st March 2008 NAV(Rs.) Magnums Dividend(Rs.) NAV(Rs.) Magnums Dividend(Rs.) Growth 30.91 23,20,05,061 N.A. 51.00 11,17,44,546 N.A. Dividend 25.12 83,74,21,089 Nil 41.50 64,36,09,876 11.00

Annual Report 2008-09 15 MAGNUM TAXGAIN SCHEME

2. Investments a. The investments of the Scheme are held in the custody of the Scheme’s custodian Stock Holding Corporation of India Limited (SHCIL). Investments are registered in the name of the scheme except where dispute exist or where the delivery has not become due. b. Cost and Market/Fair value of investments are as under: Investments As at 31st March 2009 As at 31st March 2008 Cost Market Value Cost Market Value Equity & equity related Instruments 3,14,653.77 2,23,583.15 2,20,012.01 2,60,919. 12 Non Convertible Debentures 2,500.00 2,500.00 Nil Nil Commercial Paper 19,590.34 19,590.34 23,856.62 23,856.62 Certificate of Deposits 19,094.73 19,094.73 24,618.73 24,618.73 c. The aggregate values of thinly traded, non traded and unlisted securities as at the year end, and valued on the basis of fair value computation are as under: As at 31st March 2009 As at 31st March 2008 Cost Fair Value Cost Fair Value 41,185.07 41,185.07 48,484.53 48,484.53 d. The open position in derivative products is as under: As at 31st March 2009 As at 31st March 2008 Market Value % of Net assets Market Value % of Net assets Nil Nil Nil Nil e. The open position of securities borrowed or lent by the scheme is as under: As at 31st March 2009 As at 31st March 2008 Securities borrowed Securities lent Securities borrowed Securities lent Nil Nil Nil Nil f. The details of non performing investments is as under: Investment category As at 31st March 2009 As at 31st March 2008 Outstanding Provision Made Book Value Outstanding Provision Made Book Value Equity Nil Nil Nil Nil Nil Nil

g. The details of unrealised appreciation and depreciation is as under: As at 31st March 2009 As at 31st March 2008 Amount % of net assets Amount % of net assets (91,070.62) 32.28 40,907.11 12.62 3. Purchase/Sale of Investments: The aggregate cost of purchases and sale value including redemption of investments during the year and these amounts as a percentage of average daily net assets are as follows: Current Year Previous Year Purchase % of Avg Sale % of Avg Purchase % of Avg Sale % of Avg Daily Net Daily Net Daily Net Daily Net Asset Value Asset Value Asset Value Asset Value 628,626.52 223.20 541,213.73 192.16 9,67,264.88 353.77 7,93,237.03 290.12 4. Management and Trusteeship fees: i. In terms of the Offer Document, the scheme has accrued Management fees payable to the AMC and Trusteeship Fee payable to the Trustee as a percentage of scheme’s average daily net assets, excluding Investments, if any, made (a) by AMC in the scheme, (b) by the scheme in any other Mutual fund scheme, (c) in short term fixed deposits with banks, in case of debt schemes and unamortized portion of Deferred Revenue Expenditure (if any). ii. The scheme has accrued Trusteeship fees payable to SBI Mutual Fund Trustee Co. Pvt. Ltd. at the rate of 0.01% (exclusive of service tax) of the Scheme’s average daily net assets, computed in same manner as in (i) above. iii. The basis of management fees and aggregate management fees (exclusive of service tax) payable is as under: Management fees % p.a. Management fees Trusteeship fees Average Net Assets as (Max. & Min. rate) for the year for the year stated in (i) above Current Year Previous Year Current Year Previous Year Current Year Previous Year Current Year Previous Year 0.00 to 1.25 0.00 to 0.75 1,953.41 1,615.36 31.28 27.34 2,78,857.57 2,73,374.59

Annual Report 2008-09 16 MAGNUM TAXGAIN SCHEME

5. Segment Information Each Scheme is treated as one segment. 6. Related Party Transactions (As identified by the management and relied upon by the auditors) Related Parties a. Sponsor: State Bank of India b. Trustee: SBI Mutual Fund Trustee Company Private Limited, a subsidiary of the sponsor. c. Asset Management Company: SBI Funds Management Private Limited. d. Shareholders holding substantial interest in the Asset Management Co.: i. State Bank of India ii. Société Généralé Asset Management Company. e. Subsidiaries of Major Shareholders of AMC with whom transacted i. State Bank of Bikaner & Jaipur ii. State Bank of Hyderabad iii. State Bank of Indore iv. State Bank of Mysore v. State Bank of Patiala vi. State Bank of Saurashtra (up to 13th August 2008) vii. State Bank of Travancore viii. SBI Commercial and International Bank Ltd. ix. SBI Factors & Commercial Services Pvt. Ltd. x. SBI Capital Markets Ltd. xi. SBI DFHI Ltd. xii. SBI CAP Securities Ltd. xiii. SBI Cards & Payment Services Pvt. Ltd. xiv. SBI Life Insurance Company Ltd. xv. SG Asia Equities Pvt. Ltd. f. Entities where Major Shareholders of AMC has substantial interest and with whom transacted i. Clearing Corporation of India Ltd. The Scheme has entered into transactions with related parties which are required to be disclosed in accordance with Accounting Standard – 18 ‘Related Party Disclosures’. a. The Fund has not dealt in any securities through brokers associated with any of the Major Shareholders in excess of the limit of 5% of the aggregate sale and purchase of securities made by the Mutual Fund in any block of three months. b. The transactions entered into during the year with the related parties are as under: Type of Transaction Current Year Previous year AMC Major Shareholders AMC Major Shareholders of AMC and their of AMC and their Subsidiaries Subsidiaries Brokerage on issue of Magnums Nil 651.13 Nil 1,180.35 Purchase of securities Nil 3,036.59 Nil 24,097.91 Sale of securities Nil 3,037.26 Nil 24,109.63 Brokerage on investments Nil 15.42 Nil 10.32 Bank Charges Nil 22.05 Nil 125.57 Interest received Nil 123.78 Nil 632.11 Management Fee 1,953.41 N.A. 1,615.36 N.A. Trusteeship Fee N.A. 31.28 N.A. 27.34 c. The balances with related parties as on the balance sheet date is as under: Type of Transaction Current Year Previous year AMC Major Shareholders AMC Major Shareholders of AMC and their of AMC and their Subsidiaries Subsidiaries Investment in Magnums of Scheme Nil 0.25 Nil 0.42 Investment in Equity Nil 13,028.55 Nil 4,556.72 Other receivable 5.65 Nil 357.64 Nil Other payable 60.49 2.08 Nil 2.52

Annual Report 2008-09 17 MAGNUM TAXGAIN SCHEME d. Major Shareholders of AMC and its subsidiaries hold in excess of 5% of the net assets in the following Schemes of the Fund: Current Year Previous Year Magnum Index Fund - Growth SBI One India Fund - Dividend Plan Magnum Income Fund - FRST - Dividend Magnum Monthly Income Plan Floater - Growth Magnum Insta Cash - Daily Dividend SDFS - 13 Months - 5 - Institutional - Growth MMIP Floater - Growth SDFS - 13 Months - 6 - Institutional - Growth SBI One India Fund - Dividend SBI Premier Liquid Fund - Institutional - Growth SHF- Ultra Short Term Fund - Institutional Plan Growth SDFS - 15 Months - Growth SDFS-18 Months - 2 - (Oct 07) - Institutional Growth SBI-SHF - USTF (previously known as SBI-SHF-LPF) - Institutional - Growth Magnum Index Fund - Growth e. The aggregate value of investments made by Major Shareholders and its subsidiaries in the Fund is 1,27,000.19 (Previous Years: 1,31,770.23). f. The aggregate value of investments made by all the schemes of the fund in Major Shareholders of AMC or its subsidiaries are as follows: Issuer and instrument Under this scheme All schemes of the Fund As at 31-03-09 As at 31-03-08 As at 31-03-09 As at 31-03-08 Equity shares of State Bank of India 13,028.55 4,556.72 32,137.44 23,241.14 Debt Security of State Bank of Hyderabad Nil Nil Nil 483.85 Total 13,028.55 4,556.72 32,137.44 23,724.99 g. Detail of Investments held by the AMC as on 31st March 2009 in various schemes of the fund is as under: Scheme Name AUM Magnum Insta Cash - Daily Dividend 2,209.29 SDFS - 13 Months - 8 - Institutional growth 856.28 Detail of Investments held by the AMC as on 31st March 2008 in various Schemes of the Fund is as under: Scheme Name AUM SDFS - 13 Months (March 07) - G 446.77 SDFS - 13 Months - 5 - (Aug 07) - IG 631.59 SDFS - 13 Months - 6 - (14-Dec-07) - IG 818.14 SBI Arbitrage Opportunities - G 824.40 SDFS - 15 Months - 3 - (Feb 07) - G 1,944.57 SDFS - 90 Days-20 - (26-Feb-08) - D 2,057.59 h. Subscription by the schemes (excluding secondary market purchases) in the issues lead managed by an associate company, SBI Capital Markets Limited, during the year ended 31st March 2009 is as under: Name of the issuer Instrument Name of the Scheme Amount Nil Nil Nil Nil Subscription by the schemes (excluding secondary market purchases) in the issues lead managed by an associate company, SBI Capital Markets Limited, during the year ended 31st March 2008 is as under: Name of the issuer Instrument Name of the Scheme Amount DLF Ltd. Equity SBI Infrastructure Fund Series- I 1,540.00 SBI Blue Chip Fund 385.00 SBI One India Fund 770.00 Mundra Port & Special Economic Zone Ltd. Equity Magnum Multiplier Plus Scheme 1,067.00 Magnum Equity Fund 448.00 SBI Infrastructure Fund Series- I 3,301.00 SBI One India Fund 1,920.00 MSFU-Contra 2,356.00 SBI Blue Chip Fund 1,596.00 Magnum Taxgain Scheme 3,154.00 MSFU-Emerging Business Fund 135.00 Magnum Multicap Fund 1,157.00 Magnum Balanced Fund 399.00 Magnum Monthly Income Plan 38.00 Magnum Monthly Income Plan Floater 6.00 Magnum Children Benefit Plan 8.00 Magnum Income Plus- Investment 3.00

Annual Report 2008-09 18 MAGNUM TAXGAIN SCHEME

Name of the issuer Instrument Name of the Scheme Amount BGR Energy System Ltd. Equity Magnum Global Fund 1,118.00 MSFU-Contra 1,118.00 Magnum Tax gain Scheme 1,118.00 Magnum Monthly income Plan 5.00 Magnum Monthly Income Plan Floater 1.00 Magnum Children Benefit Plan 1.00 Magnum Income Plus- Investment 0.00 Rural Electrification Corporation Ltd. Equity Magnum Multiplier Plus Scheme 538.00 Magnum Tax gain Scheme 1,611.00 Magnum Balanced Fund 397.00 MSFU- Contra 1,236.00 Magnum Monthly Income Plan 35.00 Magnum Children Benefit Plan 8.00 Magnum Monthly Income Plan Floater 5.00 Magnum Income Plus- Investment 2.00 State Bank of India (Rights Issue) Equity Magnum Taxgain Scheme 86.12 Magnum Balanced Fund 14.35 Magnum Sector Funds Umbrella - Contra 121.93 Magnum Index Fund 0.94 Magnum Children Benefit Plan 0.19 Magnum Income Plus - Investment 0.10 Magnum Investment NRI Fund - FAP 0.63 Magnum Monthly Income Plan 0.89 Magnum Monthly Income Plan Floater 0.03 SBI Blue Chip Fund 65.64 SBI One India Fund 41.84 SBI Infrastructure Fund-Series I 121.43 Total 25,930.09 7. Investors holding more than 5% of the net assets of the Scheme as on the Balance Sheet Date are as under: Name of Magnum holder No. of Magnums held % of total holding Nil Nil Nil Investors holding more than 5% of the net assets of the Scheme as on the Previous Year’s Balance Sheet Date are as under: Name of Magnum holder No. of Magnums held % of total holding Nil Nil Nil 8. Portfolio Industry wise investment portfolio of the scheme is given in Annexure A. 9. Statement of Investments made by all the Schemes of the Fund in Companies or their Subsidiaries where the Companies hold more than 5% of the Magnums in any scheme as on the balance sheet date is given in Annexure ‘B’. 10. Investors holding Magnums more than 25% of Net Asset Value in the Scheme as on the Balance Sheet Date are as under: Name of Magnum holder % of Total Holding Nil Nil

Investors holding more than 25% of Net Asset Value in the Scheme as on the Previous Year’s Balance Sheet Date are as under: Name of Magnum holder % of Total Holding Nil Nil 11. Provision for taxation No provision for taxation has been made as the Scheme qualifies as a recognised mutual fund under section 10(23D) of the Income-tax Act, 1961 and the Direct Tax Laws (Amendment) Act, 1988. Accordingly, where tax has been deducted at source on the investment income, the amount recoverable has been appropriately accounted for. 12. Income and Expenditure The total income (including profit on sale/redemption of investments and profit on inter scheme transfers and write back of provisions) for the year as a percentage of the scheme’s average net assets and the total expenditure (including loss on sale/redemption of investments and loss on inter

Annual Report 2008-09 19 MAGNUM TAXGAIN SCHEME

scheme transfers, net changes in unrealised depreciation in value of investments and other provisions) for the year as a percentage of the scheme’s average net assets is as under: Income Expenditure Amount % of average Daily Amount % of average Daily net asset (Annualised) net asset (Annualised) Current Year 6,528.28 2.32 106,780.97 37.91 Previous Year 19,435.42 7.11 5,089.33 1.86 13. Items of expenses in excess of 10% of total expenses: Nature of expenditure Current Year % Previous Year % Management Fees 37.48 31.74 Registrar Fees 20.36 26.14 Commission to agents (net of load utilised) 32.97 31.78 14. Contingent Liability Contingent liability in respect of Underwriting Commitments, Uncalled liability on partly paid shares and other commitments are Nil (Previous Year Nil). 15. The details of unclaimed redemption amount and dividend are as follows: (as compiled by the management and relied upon by the auditors) Unclaimed Redemption Unclaimed dividend No. of Magnum Amount No. of Magnum Amount Holders payable Holders payable Current Year 484 45.69 37,211 531.99 Previous Year 96 10.75 5,747 28.24 16. Details of borrowings as on the balance sheet date are as under: Amount Interest rate Source Security Extent of security Nil Nil Nil Nil Nil

Details of borrowings as on the previous balance sheet date are as under: Amount Interest rate Source Security Extent of security Nil Nil Nil Nil Nil 17. The process of reconciliation of Magnums and the amount receivable/received on issue/reissue is under progress. Further, the process of reconciliation of dividend/redemption payable to the Magnum holders is also under progress. Appropriate adjustments are made as and when the Magnums/amount is reconciled and in respect of items pending reconciliation, adjustments, if any, would be made as and when such reconciliation takes place. As on the balance sheet date (status as on 30th June 2009), the net un-reconciled amount in respect of amount receivable on issue/ reissue is 5.82 and amount payable in respect of dividend/ redemption is 36.69. The management is confident that the impact of such un- reconciled amount would not be material. 18. During the year, the Fund has changed the manner of reporting of unrealised appreciation in the value of investments to fall in line with the format prescribed by the SEBI for abridged audited accounts. The change in the unrealised appreciation in the value of investments is now credited to Revenue Account, which was hitherto taken directly to “Unrealised appreciation in the value of investments”. This change has resulted into net deficit for the year being higher by 40,907.11 However, it has no impact either on the Magnum holders’ fund or Net Asset Value. 19. Previous year comparatives Figures of the previous year have been regrouped, wherever necessary to confirm with the current year’s figures.

Annual Report 2008-09 20 MAGNUM TAXGAIN SCHEME

ANNEXURE A: SUPPLEMENTARY INVESTMENT PORTFOLIO INFORMATION AND INDUSTRYWISE CLASSIFICATION Presented below are the industrywise and companywise classification for each category of the Scheme’s investments. Industry and Company Particulars Amount Percentage to (Rs.) investment category Listed Securities: Equity Shares BANKS 3,206,936,648 14.35 State Bank Of India 1,302,854,818 5.83 HDFC Bank Ltd. 777,098,379 3.48 ICICI Bank Ltd. 690,023,268 3.08 Axis Bank Ltd. 319,526,030 1.43 Kotak Mahindra Bank Ltd. 117,434,153 0.53 PETROLEUM PRODUCTS 2,266,234,300 10.14 Reliance Industries Ltd. 1,450,893,696 6.49 Bharat Petroleum Corporation Ltd. 491,182,109 2.20 Indian Oil Corporation Ltd. 324,158,496 1.45 POWER 1,868,796,384 8.36 NTPC Ltd. 788,935,242 3.53 Tata Power Co. Ltd. 687,636,591 3.08 CESC Ltd. 254,364,299 1.14 KEC International Ltd. 92,423,745 0.41 Reliance Power Ltd. 45,436,508 0.20 INDUSTRIAL CAPITAL GOODS 1,799,490,391 8.05 Bharat Heavy Electricals Ltd. 849,708,028 3.80 Crompton Greaves Ltd. 375,609,491 1.68 Thermax Ltd. 212,675,079 0.95 Siemens Ltd. 175,481,961 0.79 Praj Industries Ltd. 118,117,024 0.53 Suzlon Energy Ltd. 67,898,809 0.30 CEMENT 1,762,845,236 7.89 ACC Ltd. 486,980,925 2.18 Jaiprakash Associates Ltd. 346,494,788 1.55 Century Textile & Industries Ltd. 270,326,808 1.22 Shree Cement Ltd. 237,882,240 1.06 Grasim Industries Ltd. 217,137,974 0.97 India Cements Ltd. 169,520,000 0.76 Mysore Cements Ltd. 34,502,500 0.15 FERROUS METALS 1,731,553,843 7.75 Jindal Steel & Power Ltd. 770,033,744 3.45 Tata Steel Ltd. 335,607,166 1.50 Steel Authority Of India Ltd. 309,919,988 1.39 Welspun Gujarat Stahl Rohren Ltd. 218,710,872 0.98 Maharashtra Seamless Ltd. 69,348,474 0.31 Man Industries (India) Ltd. 27,933,600 0.12 TELECOM - SERVICES 1,133,977,087 5.07 Bharti Airtel Ltd. 784,127,400 3.51 Reliance Communications Ltd. 349,849,687 1.56 FINANCE 1,127,065,978 5.04 Housing Development Finance Corporation Ltd. 801,011,232 3.58 Infrastructure Development Finance Co. Ltd. 324,492,148 1.45 Summit Securities Ltd. 1,562,598 0.01 CONSTRUCTION PROJECT 1,005,778,470 4.50 Larsen & Toubro Ltd. 622,505,288 2.78 GMR Infrastructure Ltd. 303,680,000 1.36 Punj Lloyd Ltd. 79,593,183 0.36 OIL 958,665,321 4.29 Oil & Natural Gas Corporation Ltd. 958,665,321 4.29

CONSUMER NON DURABLES 944,870,302 4.23 ITC Ltd. 402,299,990 1.80 Nestle India Ltd. 301,518,259 1.35 Asian Paints Ltd. 241,052,052 1.08 SOFTWARE 839,663,208 3.76 Infosys Technologies Ltd. 568,267,969 2.54 Tata Consultancy Services Ltd. 216,000,000 0.97 KPIT Cummins Infosystems Ltd. 48,949,120 0.22 Subex Ltd. 6,446,119 0.03

Annual Report 2008-09 21 MAGNUM TAXGAIN SCHEME

Industry and Company Particulars Amount Percentage to (Rs.) investment category PHARMACEUTICALS 763,685,979 3.42 Lupin Ltd. 307,904,235 1.38 Ranbaxy Laboratories Ltd. 188,024,890 0.84 Dr. Reddy’s Laboratories Ltd. 156,428,104 0.70 Opto Circuits (I) Ltd. 111,328,750 0.50 AUTO 493,614,245 2.21 Mahindra & Mahindra Ltd. 184,664,846 0.83 Tata Motors Ltd. 178,733,373 0.80 Maruti Suzuki India Ltd. 130,216,025 0.58 GAS 488,591,594 2.19 GAIL (India) Ltd. 488,591,594 2.19 NON - FERROUS METALS 443,419,797 1.98 Sterlite Industries (India) Ltd. 443,419,797 1.98 PESTICIDES 276,456,550 1.24 United Phosphorous Ltd. 276,456,550 1.24 CONSTRUCTION 269,938,212 1.21 IVRCL Infrastructures & Projects Ltd. 165,897,518 0.74 Simplex Infrastructures Ltd. 85,231,848 0.38 Ansal Properties & Infrastructure Ltd. 10,281,396 0.05 Brigade Enterprises Ltd. 8,527,450 0.04 INDUSTRIAL PRODUCTS 255,947,262 1.15 SKF India Ltd. 136,639,271 0.61 Sintex Industries Ltd. 119,307,992 0.53 DIVERSIFIED 200,914,554 0.90 Hindustan Unilever Ltd. 200,914,554 0.90 AUTO ANCILLARIES 144,412,932 0.64 Bosch Ltd. 107,387,000 0.48 Amtek Auto Ltd. 18,525,000 0.08 Apollo Tyres Ltd. 18,500,932 0.08 TRANSPORTATION 140,706,645 0.63 Blue Dart Express Ltd. 85,193,490 0.38 Mundra Port and Special Economic Zone Ltd. 55,513,155 0.25 CONSUMER DURABLES 114,764,544 0.51 Havell’s India Ltd. 114,764,544 0.51 PAPER 66,742,786 0.30 Ballarpur Industries Ltd. 66,742,786 0.30 CHEMICALS 41,925,000 0.19 Atul Ltd. 41,925,000 0.19 Total Equity Shares (i) 22,346,997,266 100.00 Equity Linked Instruments FERROUS METALS 11,317,704 100.00 Tata Steel Ltd. 11,317,704 100.00 Total Equity Linked Instruments (ii) 11,317,704 100.00 Total Listed Securities (A) 22,358,314,969 Unlisted Securities Other Debentures & Bonds CONSTRUCTION 250,000,000 100.00 Unitech Ltd. 250,000,000 100.00 ** Total Other Debentures & Bonds (i) 250,000,000 100.00 Total Unlisted Securities (B) 250,000,000 Commercial Paper FINANCE 1,959,034,300 100.00 Reliance Capital Ltd. 1,959,034,300 100.00 Total Commercial Paper (C) 1,959,034,300 100.00 Certificate of Deposits BANKS 1,909,473,214 100.00 UCO Bank 494,529,416 25.90 Union Bank 488,706,317 25.59 Indian Bank 488,552,127 25.59 Dena Bank 437,685,353 22.92 Total Certificate of Deposits (D) 1,909,473,214 100.00 Total Investments (A + B + C + D) 26,476,822,484 ** Thinly Traded & Illiquid Shares Annual Report 2008-09 22 MAGNUM TAXGAIN SCHEME

Annexure B Details of investments made in companies/subsidiary which have invested more than 5% of NAV of any scheme of SBI Mutual Fund during the year ended March 31, 2009

Company Name Scheme invested in Investment made by Schemes of SBI Mutual Fund in Company / Subsidiary by the Company Name of Scheme Aggregate for Outstanding the period as at March under 31, 2009 Regulation at Market/ 25(11) Fair at cost value (Rs. in Crores) (Rs. in Crores) ACC LTD. SBI PREMIER LIQUID FUND MAGNUM COMMA FUND 1.59 - MAGNUM EQUITY FUND 1.49 11.59 MAGNUM INDEX FUND 0.09 0.08 MAGNUM MULTICAP FUND 2.71 2.88 MAGNUM TAX GAIN SCHEME-93 21.96 48.70 SBI ARBITRAGE OPPORTUNITIES FUND 10.96 - SBI BLUE CHIP FUND 11.44 - SBI INFRASTRUCTURE FUND - SERIES - I 17.59 15.86 SBI TAX ADVANTAGE FUND - SERIES - I 3.01 5.48 ALLAHABAD BANK MAGNUM INSTA CASH FUND MAGNUM COMMA FUND 53.52 - SBI SHORT HORIZON FUND- MAGNUM GILT FUND - LONG TERM PLAN 58.69 - ULTRA SHORT TERM FUND MAGNUM INSTA CASH FUND 676.15 226.85 MAGNUM INSTA CASH FUND-LFP 21.99 15.64 MAGNUM MONTHLY INCOME PLAN - FLOATER 1.50 - MAGNUM MULTIPLIER PLUS SCHEME - 1993 46.70 - SBI DEBT FUND SERIES - 13 MONTHS - 10 93.06 93.06 SBI DEBT FUND SERIES - 13 MONTHS - 5 4.81 - SBI DEBT FUND SERIES - 13 MONTHS - 8 100.72 - SBI DEBT FUND SERIES - 13 MONTHS - 9 93.51 93.51 SBI DEBT FUND SERIES - 30 DAYS - 3 195.26 - SBI DEBT FUND SERIES - 90 DAYS - 25 46.83 - SBI DEBT FUND SERIES - 90 DAYS - 26 19.25 - SBI DEBT FUND SERIES - 90 DAYS - 29 4.80 - SBI DEBT FUND SERIES - 90 DAYS - 31 165.34 - SBI DEBT FUND SERIES - 90 DAYS - 32 97.77 - SBI DEBT FUND SERIES - 180 DAYS - 8 71.26 - SBI INFRASTRUCTURE FUND - SERIES - I 6.80 - SBI PREMIER LIQUID FUND 605.61 - SBI SHORT HORIZON FUND - SHORT TERM FUND 0.16 - SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 600.22 - SBI TAX ADVANTAGE FUND - SERIES - I 5.83 - BIRLA CORPORATION LTD. SBI DEBT FUND SERIES - 13 MONTHS - 7 SBI ONE INDIA FUND 0.11 2.32 CORPORATION BANK SBI PREMIER LIQUID FUND MAGNUM GILT FUND - LONG TERM PLAN 49.33 - MAGNUM INSTA CASH FUND 130.03 - MAGNUM INSTA CASH FUND-LFP 5.93 - MAGNUM INCOME FUND - 1998 6.94 - SBI ARBITRAGE OPPORTUNITIES FUND 43.56 - SBI CAPITAL PROTECTIION ORIENTED FUND - SERIES - I 4.95 - SBI DEBT FUND SERIES - 90 DAYS - 27 8.83 -

Annual Report 2008-09 23 MAGNUM TAXGAIN SCHEME

SBI DEBT FUND SERIES - 90 DAYS - 29 48.72 - SBI DEBT FUND SERIES - 90 DAYS - 31 140.85 - SBI PREMIER LIQUID FUND 49.18 - SBI SHORT HORIZON FUND - SHORT TERM FUND 0.16 - SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 121.40 - CUMMINS INDIA LTD. SBI PREMIER LIQUID FUND SBI ARBITRAGE OPPORTUNITIES FUND 0.27 - GMR INFRASTRUCTURE SBI DEBT FUND SERIES - 180 DAYS - 8 MAGNUM MULTICAP FUND 2.06 12.33 LTD. MAGNUM SECTOR FUND UMBRELLA - EBF 6.90 5.00 MAGNUM TAX GAIN SCHEME-93 15.37 30.37 SBI ARBITRAGE OPPORTUNITIES FUND 1.68 - SBI BLUE CHIP FUND 13.44 - HINDALCO INDUSTRIES LTD. SBI DEBT FUND SERIES - 13 MONTHS 6 MAGNUM CHILDREN BENEFIT PLAN 0.00 0.06 SBI DEBT FUND SERIES - 90 DAYS - 26 MAGNUM COMMA FUND 15.10 8.73 SBI DEBT FUND SERIES - 90 DAYS - 27 MAGNUM INDEX FUND 0.13 0.07 SBI DEBT FUND SERIES - 180 DAYS - 8 MAGNUM MULTICAP FUND 6.45 2.32 SBI PREMIER LIQUID FUND MAGNUM SECTOR FUND UMBRELLA - CONTRA 37.85 8.89 MAGNUM NRI INVESTMENT FUND - FLEXI ASSET PLAN 0.29 0.09 SBI ARBITRAGE OPPORTUNITIES FUND 18.41 7.60 SBI BLUE CHIP FUND 3.43 5.21 SBI CAPITAL PROTECTIION ORIENTED FUND - SERIES - I 6.69 - SBI TAX ADVANTAGE FUND - SERIES - I 9.21 3.23 HINDUSTAN UNILEVER LTD. SBI DEBT FUND SERIES - 90 DAYS - 28 MAGNUM BALANCE FUND 8.52 8.10 SBI DEBT FUND SERIES - 90 DAYS - 29 MAGNUM INDEX FUND 0.43 0.38 MAGNUM MULTICAP FUND 4.22 4.53 MAGNUM SECTOR FUND UMBRELLA - CONTRA 18.22 18.70 MAGNUM SECTOR FUND UMBRELLA - FMCG 1.28 - MAGNUM TAX GAIN SCHEME-93 33.71 20.09 SBI ARBITRAGE OPPORTUNITIES FUND 14.40 7.41 SBI BLUE CHIP FUND 22.95 20.35 SBI TAX ADVANTAGE FUND - SERIES - I 11.66 10.28 HINDUSTAN ZINC LTD. SBI DEBT FUND SERIES - 13 MONTHS - 10 MAGNUM COMMA FUND 12.96 19.84 SBI DEBT FUND SERIES - 13 MONTHS - 9 MAGNUM MULTICAP FUND 3.95 3.31 SBI DEBT FUND SERIES - 90 DAYS - 26 MAGNUM SECTOR FUND UMBRELLA - CONTRA 4.31 37.00 SBI DEBT FUND SERIES - 90 DAYS - 29 SBI ONE INDIA FUND 2.06 6.06 SBI TAX ADVANTAGE FUND - SERIES - I 8.03 6.54 ICRA LTD. SBI DEBT FUND SERIES - 13 MONTHS 6 MAGNUM BALANCE FUND 2.46 2.79 SDFS-18M-3 MAGNUM SECTOR FUND UMBRELLA - EBF 1.60 1.83 IFCI LTD. MAGNUM INSTA CASH FUND SBI ARBITRAGE OPPORTUNITIES FUND 5.72 1.70 INDIABULLS FINANCIAL MAGNUM INSTA CASH FUND MAGNUM INSTA CASH FUND 280.23 - SERVICES LTD. MAGNUM INSTA CASH FUND-LFP 16.60 - MAGNUM INCOME FUND - 1998 4.88 - SBI DEBT FUND SERIES - 13 MONTHS 6 3.90 - SBI DEBT FUND SERIES - 13 MONTHS - 8 4.88 - SBI DEBT FUND SERIES - 18 MONTHS 1 0.96 - SBI DEBT FUND SERIES - 18 MONTHS 2 1.95 - SBI DEBT FUND SERIES - 24 MONTHS 1 2.93 - SBI DEBT FUND SERIES - 30 DAYS - 3 94.49 - SBI DEBT FUND SERIES - 370 DAYS - 2 10.38 - SBI DEBT FUND SERIES - 90 DAYS 24 71.61 - SBI DEBT FUND SERIES - 90 DAYS - 28 48.85 -

Annual Report 2008-09 24 MAGNUM TAXGAIN SCHEME

SBI PREMIER LIQUID FUND 324.08 - SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 134.56 - INDIAN BANK MAGNUM INSTA CASH FUND MAGNUM BALANCE FUND 14.29 - SBI PREMIER LIQUID FUND MAGNUM INSTA CASH FUND 293.94 147.88 MAGNUM INSTA CASH FUND-LFP 29.68 29.68 MAGNUM SECTOR FUND UMBRELLA - CONTRA 19.05 - MAGNUM TAX GAIN SCHEME-93 48.85 48.85 SBI ARBITRAGE OPPORTUNITIES FUND 32.42 - SBI BLUE CHIP FUND 28.57 - SBI DEBT FUND SERIES - 13 MONTHS - 7 4.53 - SBI DEBT FUND SERIES - 90 DAYS - 25 44.92 - SBI DEBT FUND SERIES - 90 DAYS - 26 92.99 - SBI DEBT FUND SERIES - 90 DAYS - 27 95.00 - SBI DEBT FUND SERIES - 90 DAYS - 30 45.93 - SBI INFRASTRUCTURE FUND - SERIES - I 24.68 19.86 SBI PREMIER LIQUID FUND 401.16 - SBI SHORT HORIZON FUND - SHORT TERM FUND 2.15 2.15 SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 433.86 45.03 ITC LTD. MAGNUM INCOME FUND - 1998 MAGNUM BALANCE FUND 8.18 11.47 SBI DEBT FUND SERIES - 90 DAYS - 26 MAGNUM EQUITY FUND 6.58 7.39 SBI PREMIER LIQUID FUND MAGNUM INDEX FUND 0.57 0.52 MAGNUM MULTIPLIER PLUS SCHEME - 1993 13.03 22.19 MAGNUM MULTICAP FUND 17.69 19.40 MAGNUM SECTOR FUND UMBRELLA - CONTRA 50.22 73.78 MAGNUM SECTOR FUND UMBRELLA - FMCG 4.08 1.29 MAGNUM TAX GAIN SCHEME-93 36.19 40.23 MAGNUM NRI INVESTMENT FUND - FLEXI ASSET PLAN 0.13 0.37 SBI ARBITRAGE OPPORTUNITIES FUND 40.78 33.64 SBI BLUE CHIP FUND 9.00 18.94 SBI ONE INDIA FUND 0.94 33.39 SBI TAX ADVANTAGE FUND - SERIES - I 16.60 14.74 MARUTI SUZUKI INDIA LTD. SBI DEBT FUND SERIES - 13 MONTHS - 10 MAGNUM BALANCE FUND 0.78 1.16 SBI DEBT FUND SERIES - 13 MONTHS - 7 MAGNUM INDEX FUND 0.19 0.17 SBI DEBT FUND SERIES - 13 MONTHS - 8 MAGNUM MULTIPLIER PLUS SCHEME - 1993 8.83 - SBI PREMIER LIQUID FUND MAGNUM SECTOR FUND UMBRELLA - CONTRA 11.10 17.90 MAGNUM TAX GAIN SCHEME-93 10.65 13.02 SBI ARBITRAGE OPPORTUNITIES FUND 6.75 - SBI BLUE CHIP FUND 1.92 8.14 SBI ONE INDIA FUND 12.82 4.27 SBI TAX ADVANTAGE FUND - SERIES - I 3.09 6.20 NATIONAL ALUMINIUM SBI DEBT FUND SERIES - 13 MONTHS - 7 MAGNUM INDEX FUND 0.31 0.10 CO LTD. NATIONAL HOUSING BANK MAGNUM INSTA CASH FUND MAGNUM INSTA CASH FUND 198.49 - SBI PREMIER LIQUID FUND SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 1.33 1.21 PUNJAB NATIONAL BANK SBI SHORT HORIZON FUND - MAGNUM CHILDREN BENEFIT PLAN 1.96 - ULTRA SHORT TERM FUND MAGNUM EQUITY FUND 11.35 - MAGNUM GILT FUND - LONG TERM PLAN 123.48 - MAGNUM GILT FUND - SHORT TERM PLAN 9.73 - MAGNUM INSTA CASH FUND 662.79 73.74 MAGNUM INSTA CASH FUND-LFP 25.68 -

Annual Report 2008-09 25 MAGNUM TAXGAIN SCHEME

MAGNUM MIDCAP FUND 9.73 - MAGNUM INCOME FUND - FLOATING RATE - SHORT TERM PLAN 0.98 - MAGNUM INDEX FUND 0.12 0.10 MAGNUM INCOME FUND - 1998 6.57 - MAGNUM MULTIPLIER PLUS SCHEME - 1993 3.74 19.84 MAGNUM MULTICAP FUND 3.41 3.08 MAGNUM SECTOR FUND UMBRELLA - CONTRA 176.41 6.05 MAGNUM TAX GAIN SCHEME-93 25.54 - SBI ARBITRAGE OPPORTUNITIES FUND 72.54 - SBI BLUE CHIP FUND 9.73 - SBI DEBT FUND SERIES - 13 MONTHS - 10 23.29 23.29 SBI DEBT FUND SERIES - 13 MONTHS - 5 5.82 - SBI DEBT FUND SERIES - 13 MONTHS - 7 27.91 24.97 SBI DEBT FUND SERIES - 13 MONTHS - 8 78.24 - SBI DEBT FUND SERIES - 13 MONTHS - 9 168.39 168.39 SBI DEBT FUND SERIES - 370 DAYS - 1 46.22 - SBI DEBT FUND SERIES - 370 DAYS - 2 26.31 - SBI DEBT FUND SERIES - 90 DAYS - 26 138.17 - SBI DEBT FUND SERIES - 90 DAYS - 27 7.93 - SBI DEBT FUND SERIES - 90 DAYS - 28 29.53 - SBI DEBT FUND SERIES - 90 DAYS - 29 2.44 - SBI DEBT FUND SERIES - 90 DAYS - 30 58.70 - SBI DEBT FUND SERIES - 90 DAYS - 31 110.55 - SBI DEBT FUND SERIES - 90 DAYS - 32 62.86 - SBI DEBT FUND SERIES - 180 DAYS - 8 53.18 - SBI PREMIER LIQUID FUND 917.92 - SBI SHORT HORIZON FUND - SHORT TERM FUND 4.97 4.97 SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 1,190.87 401.61 RELIGARE FINVEST LTD. SBI PREMIER LIQUID FUND MAGNUM INSTA CASH FUND 147.60 - MAGNUM INSTA CASH FUND-LFP 9.59 - MAGNUM INCOME FUND - FLOATING RATE - SHORT TERM PLAN 1.72 - SBI DEBT FUND SERIES - 18 MONTHS 2 5.28 - SBI DEBT FUND SERIES - 24 MONTHS 1 5.67 - SBI DEBT FUND SERIES - 370 DAYS - 2 24.28 - SBI DEBT FUND SERIES - 90 DAYS - 22 4.63 - SBI DEBT FUND SERIES - 90 DAYS 24 100.00 - SBI DEBT FUND SERIES - 90 DAYS - 27 96.59 - SBI DEBT FUND SERIES - 90 DAYS - 28 50.00 - SBI PREMIER LIQUID FUND 223.95 - SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 125.34 - SESA GOA LTD. SBI DEBT FUND SERIES - 13 MONTHS - 10 MAGNUM BALANCE FUND 3.30 - SBI DEBT FUND SERIES - 90 DAYS - 29 MAGNUM COMMA FUND 8.05 8.12 SBI ARBITRAGE OPPORTUNITIES FUND 8.29 1.93 SHREE CEMENT LTD. SBI ARBITRAGE OPPORTUNITIES FUND MAGNUM BALANCE FUND 0.67 5.97 MAGNUM SECTOR FUND UMBRELLA - CONTRA 1.27 23.82 MAGNUM TAX GAIN SCHEME-93 0.56 23.79 SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 100.00 - STATE BANK OF INDIA MAGNUM INSTA CASH FUND MAGNUM BALANCE FUND 17.44 8.75

Annual Report 2008-09 26 MAGNUM TAXGAIN SCHEME

MAGNUM INDEX FUND MAGNUM CHILDREN BENEFIT PLAN 0.04 0.28 SBI ONE INDIA FUND MAGNUM EQUITY FUND 4.61 4.27 SBI PREMIER LIQUID FUND MAGNUM INDEX FUND 0.97 0.5 SBI SHORT HORIZON FUND - MAGNUM INCOME PLUS - INVESTMENT 0.02 0.04 ULTRA SHORT TERM FUND MAGNUM MONTHLY INCOME PLAN 0.20 - MAGNUM MONTHLY INCOME PLAN - FLOATER 0.01 0.11 MAGNUM SECTOR FUND UMBRELLA - CONTRA 101.02 70.59 MAGNUM TAX GAIN SCHEME-93 120.56 130.29 MAGNUM NRI INVESTMENT FUND - FLEXI ASSET PLAN 0.50 0.35 SBI ARBITRAGE OPPORTUNITIES FUND 45.62 - SBI BLUE CHIP FUND 51.24 29.17 SBI INFRASTRUCTURE FUND - SERIES - I 65.76 45.29 SBI ONE INDIA FUND 21.36 21.69 SBI TAX ADVANTAGE FUND - SERIES - I 16.87 10.35 STERLITE INDUSTRIES SBI DEBT FUND SERIES - 90 DAYS - 26 MAGNUM BALANCE FUND 5.49 6.10 (INDIA) LTD. SBI DEBT FUND SERIES - 90 DAYS - 29 MAGNUM COMMA FUND 11.53 15.65 MAGNUM INDEX FUND 0.28 0.19 MAGNUM MULTIPLIER PLUS SCHEME - 1993 5.20 16.00 MAGNUM SECTOR FUND UMBRELLA - CONTRA 41.20 23.47 MAGNUM TAX GAIN SCHEME-93 19.14 44.34 SBI ARBITRAGE OPPORTUNITIES FUND 8.26 - SBI BLUE CHIP FUND 19.49 20.84 SBI INFRASTRUCTURE FUND - SERIES - I 1.30 21.34 SBI ONE INDIA FUND 1.30 8.71 SBI TAX ADVANTAGE FUND - SERIES - I 10.01 6.05 SYNDICATE BANK MAGNUM INSTA CASH FUND SBI DEBT FUND SERIES - 13 MONTHS - 10 101.38 101.38 SBI SHORT HORIZON FUND - SBI DEBT FUND SERIES - 13 MONTHS - 9 163.87 163.87 ULTRA SHORT TERM FUND SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 186.97 14.96 TATA CAPITAL LTD. SBI PREMIER LIQUID FUND SBI DEBT FUND SERIES - 90 DAYS - 27 25.00 - TATA CONSULTANCY SBI DEBT FUND SERIES - 90 DAYS - 28 MAGNUM INDEX FUND 0.53 0.40 SERVICES LTD. MAGNUM MULTICAP FUND 20.49 12.01 MAGNUM SECTOR FUND UMBRELLA - CONTRA 33.81 37.23 MAGNUM SECTOR FUND UMBRELLA - IT 1.05 3.28 MAGNUM TAX GAIN SCHEME-93 34.05 21.60 MAGNUM NRI INVESTMENT FUND - FLEXI ASSET PLAN 0.18 0.15 SBI ARBITRAGE OPPORTUNITIES FUND 22.61 0.62 SBI BLUE CHIP FUND 7.14 10.79 SBI CAPITAL PROTECTIION ORIENTED FUND - SERIES - I 6.67 3.92 SBI TAX ADVANTAGE FUND - SERIES - I 11.43 5.40 TATA STEEL LTD. SBI PREMIER LIQUID FUND MAGNUM COMMA FUND 9.66 17.19 MAGNUM INDEX FUND 0.25 0.11 MAGNUM SECTOR FUND UMBRELLA - CONTRA 46.39 28.29 MAGNUM TAX GAIN SCHEME-93 32.86 34.69 MAGNUM NRI INVESTMENT FUND - FLEXI ASSET PLAN 0.19 0.17 SBI ARBITRAGE OPPORTUNITIES FUND 79.11 - SBI BLUE CHIP FUND 28.18 11.30 SBI INFRASTRUCTURE FUND - SERIES - I 2.91 28.27 SBI TAX ADVANTAGE FUND - SERIES - I 22.23 5.15

Annual Report 2008-09 27 MAGNUM TAXGAIN SCHEME

UCO BANK MAGNUM INSTA CASH FUND MAGNUM INSTA CASH FUND 365.18 - MAGNUM INSTA CASH FUND-LFP 24.76 24.76 MAGNUM INCOME FUND - FLOATING RATE - SHORT TERM PLAN 1.98 1.98 MAGNUM INCOME FUND - 1998 17.83 17.83 MAGNUM MONTHLY INCOME PLAN 4.95 4.95 MAGNUM SECTOR FUND UMBRELLA - CONTRA 33.80 - MAGNUM TAX GAIN SCHEME-93 92.61 49.44 SBI DEBT FUND SERIES - 13 MONTHS - 10 93.02 93.02 SBI DEBT FUND SERIES - 13 MONTHS - 5 4.75 - SBI DEBT FUND SERIES - 13 MONTHS - 8 7.60 - SBI DEBT FUND SERIES - 90 DAYS - 25 29.94 - SBI DEBT FUND SERIES - 90 DAYS - 26 66.07 - SBI DEBT FUND SERIES - 90 DAYS - 27 46.06 - SBI DEBT FUND SERIES - 90 DAYS - 29 79.23 - SBI DEBT FUND SERIES - 90 DAYS - 32 301.07 - SBI DEBT FUND SERIES - 180 DAYS - 8 46.59 - SBI INFRASTRUCTURE FUND - SERIES - I 14.39 - SBI PREMIER LIQUID FUND 245.45 - SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 942.37 139.45 SBI TAX ADVANTAGE FUND - SERIES - I 3.84 - UNITED BANK OF INDIA MAGNUM INSTA CASH FUND MAGNUM INSTA CASH FUND 48.54 48.54 WELSPUN GUJARAT SBI PREMIER LIQUID FUND MAGNUM GLOBAL FUND -1994 3.15 5.78 STAHL ROHREN LTD. MAGNUM MIDCAP FUND 3.94 2.59 MAGNUM SECTOR FUND UMBRELLA - CONTRA 18.50 16.33 MAGNUM TAX GAIN SCHEME-93 8.34 21.87 SBI TAX ADVANTAGE FUND - SERIES - I 4.62 2.35 YES BANK LTD. SBI PREMIER LIQUID FUND MAGNUM GILT FUND - LONG TERM PLAN 39.43 - MAGNUM INSTA CASH FUND 428.68 133.40 MAGNUM INSTA CASH FUND-LFP 17.24 - MAGNUM INCOME PLUS - INVESTMENT 0.48 - MAGNUM SECTOR FUND UMBRELLA - CONTRA 23.59 - MAGNUM TAX GAIN SCHEME-93 118.10 - SBI ARBITRAGE OPPORTUNITIES FUND 24.77 - SBI DEBT FUND SERIES - 30 DAYS - 2 24.51 - SBI DEBT FUND SERIES - 30 DAYS - 3 74.05 - SBI DEBT FUND SERIES - 30 DAYS - 4 23.75 - SBI DEBT FUND SERIES - 370 DAYS - 2 23.44 - SBI DEBT FUND SERIES - 90 DAYS 24 24.47 - SBI DEBT FUND SERIES - 90 DAYS - 25 91.32 - SBI DEBT FUND SERIES - 90 DAYS - 26 144.49 - SBI DEBT FUND SERIES - 90 DAYS - 27 19.93 - SBI DEBT FUND SERIES - 90 DAYS - 29 93.34 - SBI DEBT FUND SERIES - 90 DAYS - 30 39.57 - SBI DEBT FUND SERIES - 90 DAYS - 31 8.70 - SBI DEBT FUND SERIES - 180 DAYS - 8 135.00 - SBI INFRASTRUCTURE FUND - SERIES - I 10.61 - SBI ONE INDIA FUND 9.57 - SBI PREMIER LIQUID FUND 547.16 34.15 SBI SHORT HORIZON FUND - ULTRA SHORT TERM FUND 329.21 23.93

Annual Report 2008-09 28 MAGNUM TAXGAIN SCHEME

KEY STATISTICS FOR THE YEAR / PERIOD ENDED 31/03/2009 Current Previous Year / Period Year / Period ended 31/03/2009 ended 31/03/2008 1. NAV per unit (Rs.): Open Growth 51.00 N.A. Dividend 41.50 42.42 High Growth 55.21 70.63 Dividend 44.87 70.58 Low Growth 27.19 44.74 Dividend 22.10 39.25 End Growth 30.91 51.00 Dividend 25.12 41.50

2. Closing Assets Under Management (Rs. in Lakhs) End 2,82,087.17 3,24,060.61 Average (AAUM) 2,81,643.27 2,73,418.51

3. Gross income as % of AAUM 2.32 7.11

4. Expense Ratio: a. Total Expense as % of AAUM ### 1.85 1.86 b. Management Fee as % of AAUM 0.70 0.59

5. Net Income as a percentage of AAUM (3.26) 5.25

6. Portfolio turnover ratio 0.18 0.26

7. Total Dividend per unit distributed during the year / period Nil 11.00

8. Returns: a. Last One Year Scheme Growth (39.48) N.A. Dividend (39.47) 20.23 Benchmark - BSE 100 Growth (39.97) N.A. Dividend (39.97) 24.83 b. Since Inception Scheme Growth (18.04) 13.19 Dividend 16.24 21.41 Benchmark - BSE 100 Growth (17.19) 16.37 Dividend 10.35 14.92

### Total Expenditure does not include loss on sale/redemption of investments, loss on inter-scheme transfer/sale of investments, net change in unrealised depreciation in value of investments, deferred revenue expenditure amortised and Provision for Doubtful Debt, Income, Deposits.

Risk Factors: Mutual Funds and Securities Investments are subject to market risks and there is no assurance or guarantee that the scheme’s objectives will be achieved. As with any other investment in securities, the NAV of the Magnums/Units issued under the scheme(s) may go up or down depending upon the various factors and forces affecting the securities market. Past performance of the Sponsor/AMC/Mutual Fund/Scheme(s) and their affiliates do not indicate the future performance of the Scheme(s) of the Mutual Fund. Statutory details: SBI Mutual Fund has been set up as a trust under the Indian Trusts Act, 1882. State Bank of India (‘SBI’), the sponsor is not responsible or liable for any loss resulting from the operation of the schemes beyond the initial contribution made by it of an amount of Rs. 5 lakhs towards setting up of the mutual fund. Asset Management Company: SBI Funds Management Private Limited (A joint venture between SBI and Société Générale Asset Management) -191, Maker Tower ‘E’, 19th Floor, Cuffe Parade, Mumbai 400 005. Trustee Company: SBI Mutual Fund Trustee Company Pvt. Ltd. Please read the Offer Document / Scheme Information Document carefully before investing. Annual Report 2008-09 29