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Sahara Infrastructure Fund

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INDEXSAHARA INFRASTRUCTURE FUND

1. Report of the Trustees ..................................................................................................... 4

2. AuditorsCertificateontheReportonVotingDecisionsInTheInvesteeCompanies ... 8

3. Auditors report to the Trustees of Sahara Mutual Fund .................................................. 9

4. AbridgedBalanceSheetasat31stMarch,2016 ............................................................ 11

5. AbridgedRevenueAccountfortheyearended31stMarch,2016 ................................. 12

6. NotestoAccounts. ........................................................................................................... 13

7. KeyStatisticsfortheyearended31stMarch2016 ........................................................ 17

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REPORT OF THE TRUSTEESWearepleasedtopresentbeforeyoutheANNUALREPORTofSAHARAMUTUALFUNDfortheyearendedMarch31,2016.Overview of Debt Markets in 2015-162015-16 was not an encouraging year for the Indian debt market, with the INR depreciating and the 10 Year G-sec YieldsremainingFlat(April2015:7.22%--March2016:7.46%).FIIflowshavebeenmuted.Asignificantchangeininflationmanagementregimewasagreedin2015betweentheRBIandthegovernment.Underthisnewmonetarypolicyframework,therewillnowbeaformalinflationtargetfortheRBIwhichhasbeenfixedat4%withinatolerancebandof+/-2%.TheRBIisaimingtohitthistargetrangefrom2017onwards.Thecontinuedsuccesson the inflation frontcombinedwithgrowthdisappointmentsallowed theRBI tocutpolicy ratesby125bpsovertheyear.However,10yeargovernmentsecuritiesdeclinedbyjust10basispoint.EnsuringthebulkofthereturninthefixedincomefundcamefromcouponincomeratherthancapitalappreciationaswasexpectedOverview of Equity Markets in 2015-16Indian equities performed in linewith emerging-market equities in 2015 following big outperformance in 2014.Expectations ofrelativeoutperformance from Indianequities in2015werehigh.Riding the ‘anticipated–reform -agenda’wave,equitymarketsopened2015onanoptimisticnote.However,as theyearprogressed,disappointmentsoncorporateearnings, lackof credibledevelopment on significant reforms (such as GST and Land Acquisition Bill) and aggravated concerns on slowing globalgrowth, led by theChinese slowdown, began toweigh on local equities. China’s slowdown has hurt EmergingMarket growthandcommoditypricesthisyear,draggingnotablyBrazilandRussiaintorecessions.TheFedraisedratesforthefirsttimesince2006.However,Fedpolicymakershavereiteratedagradualpathofraterisesinthefuture.Fortheyear2015-16,theS&PBSESensexended-10.32%lowerat25341.86levels,whiletheNifty50closed-9.87%lowerat7,738.4compared to their respectiveclosingfiguresasonMarch31,2016.Thesilver lininghowever,was thecontinuedflowsreceived by domestic institutions, particularlymutual funds, from retail participantswho sawgreat opportunity in exploiting thevaluationarbitragecreatedfromtheearlierrun-upinthebenchmarkindicesandlargecapstocks.TheReserveBankof Indiaaidedbygovernmentpoliciesand lowercommodityprices,hasmanaged tohelpcurtail inflation in2015.Thisprovided theRBIwithheadroom tocut keybenchmark ratesbyasmuchas125bps thiscalendaryear tosupportgrowth. The underlying stance from the Indian central bank continues to be ‘accommodative’ despite its caution on risinginflationarypressures.TheRBIexpectsinflationtobebroadlycurtailedheadinginto2016Furthermore,theModi-ledNDAgovernmentfailedtomakeprogress in implementingkeyreformsincluding landacquisitionandGoodsandServicesTax(GST)with themonsoonsessionof theParliamentbeinga completewashoutand thewinter sessionendingonamutenote.The rupee fell for the fifth straight year amid global turmoil and strengthening of the US dollar. However, it emerged as oneof the top performing emergingmarkets’ currency, bucking the trend inAsia on the back of slipping oil prices and intermittentinterventionbytheRBI

1. Scheme Performance, Future Outlook and Operations of Sahara Infrastructure FundReturns:

Performance as of March 31, 2016 1 year Since inception Inception DateSaharaInfrastructureFund(%) VariablePricingOption (3.3378) 6.8370

April3,2006FixedPricingOption (5.2207) 5.8482Nifty50Index(%) (8.8635) 8.3405

“Thepriceandredemptionvalueof theunits,andincomefromthem,cangoupaswellasdownwiththefluctuations inthemarketvalueofitsunderlyinginvestments;”.As onMarch 31, 2016, the schemehad invested 98.58%of its net assets invested in equities and the balance 1.42% incashandcashreceivables.

DEBT MARKETSIndiahas to repay$36bnFCNR(B)Deposit,at itsmaturity inSeptember2016.Whilewehaveadequate reserves,suchlargeoutflowswillhaveadverseimpactonrupee.AsharperdepreciationofrupeecouldhaveadverseshorttermimpactonIndian interest rates.Going forward, theReserveBankhasmaintained itsaccommodativestanceandhaskept thedoorsopen for ratecutsasandwhenroomisavailable,whichislikelytokeepthebondmarketsentimentspositive.However,thepaceofUSFedratehike anddevelopment inChinaare likely to keep themarkets volatile andon fence.The key indirect tax reform theGST(GoodsandServicesTax)whichwaspromisedtobeimplementedinApril2016isyettobepassedintheparliament.On the balance 2016-17 is going to be better year as Investor expectations have moderated and economic recovery isvisible.This belief is also supported by expectations that Indianmacroeconomic situation is expected to be strongdue tolowercommoditypricesandlowerfiscaldeficitinthenextfinancialyear.The rupee, too, is expected to remain stable against major currencies as, comfortable forex reserves and balance ofpaymentsshouldsoftenanycurrencyimpactduetolumpyoutflows.ThisshouldkeepFIIdebtinflowsstrong,

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It is also interesting to note that the spreadbetween theUSand Indian10 year yields remains close to its highover thelastdecadewhichprovidesadegreeofcomfortforlongbondyieldsThe rupee, too, is expected to remain stable against major currencies as, comfortable forex reserves and balance ofpaymentsshouldsoftenanycurrencyimpactduetolumpyoutflows.ThisshouldkeepFIIdebtinflowsstrong,It is also interesting to note that the spreadbetween theUSand Indian10 year yields remains close to its highover thelastdecadewhichprovidesadegreeofcomfortforlongbondyields.EQUITY MARKETSThis year,we feelmore optimistic! Investor expectations havemoderated, economic recovery is visible and the elusivecorporate-earnings growth story should finally begin to play out. Several structural reforms are underway, domesticinvestors continue to show faith, and the corporate profitability cycle is at an all-time low.Average valuations on cycle-lowearningsappearattractive.Indiastandsoutasthefastest-growingemergingmarket.Comfortable forex reserves and balance of payments should soften any currency impact. High-frequency economicindicators imply that the economy bottomed out in 1HCY15 and growth is now visible. The bottoming of the propertymarket thisyearwilldriveabroadereconomic recovery.Theoutlook forboth inflationandgrowth remains ratherbenignforFY17withentrenchedglobalslowdownbackdrop.Thefiscalstancehasalsobeenrathercomforting.Thegovernmentdecided to adhere to the fiscal goalposts and staggered the seventh pay commission allowances. It alsomoved furtheronsupplyenhancementinruralsegment,roadsandrailways.Importantly, the new MCLR regime (Marginal Cost of Funds Based Lending Rate) has kicked in from April 1, 2016wherein Banks shift to use their incremental cost of funds, rather than average cost of deposits to arrive at newbenchmark rate for lending. However, there remains one large ‘known unknown’ from RBI’s perspective – the fateof monsoons. While global agencies are hinting at weakening of El Nino effect from May onwards, rains can still getdelayeddespitebeing‘normal’givenuncertainmeteorologicalfactorsandtimelagsinvolved.FateofthebankingresultsandincrementalRBIstanceonAQRandstressrecognitionalongwithpaceofFedtighteningandchinaslowdown(alongwithitsimpactoncommodities)willbepivotaltothemarketperformance.2. Brief Background of Sponsor, Trust, and AMC Company(a) Sahara Mutual FundSaharaMutualFund(SMF)hasbeenestablishedasaTrustbytheTrustDeed(amendedfromtimetotime)dated18thJuly,1996inaccordancewiththeIndianTrustsAct,1882,anddulyregisteredundertheIndianRegistrationAct,1908,sponsoredbySaharaIndiaFinancialCorporationLimited(“SIFCL”).TheTrustees have appointed SaharaAssetManagement Company Private Limited as the InvestmentManager to SaharaMutualFund to functionas the InvestmentManager forall theSchemesofSaharaMutualFund.SaharaMutualFundwasregisteredwithSEBIon1stOctober,1996.“SEBIvide itsOrderno:WTM/PS/26/IMD/DOF-III/July/2015dated28thJuly,2015haddirectedcancellationof“CertificateofRegistration”ofSaharaMutualFundwhichwas tobeeffectiveonexpiryofsixmonths from thedateof theOrder.Further,SEBIalsodirectedby thesaidOrder that theMutualFundshall not takeanynewsubscription from investors.Accordingly,theMutual Fund has not taken any new subscription from the investors (including existing investors) in line with the saidSEBIorder.SaharaAssetManagementCompanyPvt.Ltd(SAMCPL)filedanappealbeforetheSecuritiesAppellateTribunal(SAT),MumbaitosetasidethesaidSEBIorder.SATvide itsorderdated9thDecember,2015grantedan interimstay inthematter.Theappealispendingfordecision/disposalwiththeSecuritiesAppellateTribunal(SAT).””(b) Board of TrusteesTheBoardofTrusteesasondatecomprisesMr.S.RHegde, IndependentTrustee,Dr.P.PShastri, IndependentTrusteeandMrSPSrivastavaAssociateTrustee.The Board of Trustees is the exclusive owner of the Trust Fund and holds the same in trust for the benefit of the unitholders. The Board of Trustees has been discharging its duties and carrying out the responsibilities as provided in theRegulationsandtheTrustDeed.TheBoardofTrusteesseekstoensurethattheFundandtheSchemesfloatedthereunderaremanagedbytheAMCinaccordancewiththeTrustDeed,theRegulations,directionsandguidelinesissuedbytheSEBI,theStockExchanges,theAssociationofMutualFundsinIndiaandotherregulatoryagencies.3. Investment Objective of the Scheme.The investment objective is to provide income distribution and/ormedium to long term capital gains by investing in equity/equityrelatedinstrumentsofcompaniesmainlyintheInfrastructuresector.4. SignificantAccountingPoliciesTheBalanceSheet and theRevenueAccount togetherwith thenotes thereonhavebeenprepared in accordancewith theaccounting policies and standards specified in the Ninth Schedule of the Securities and Exchange Board of India (MutualFunds)Regulations,1996andamendmentsthereto,asapplicable.5. Unclaimed Dividends and Redemptions

Scheme Name No of Investors Unclaimed Dividend (`) No of Investors Unclaimed Redemption (`)

Sahara Infrastructure Fund 32 148,575.30 68 869,546.49

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6. Disclosure of investor complaints for the year 2015-16TotalNumberofFoliosunderallschemes:21000

ComplaintCode

TypeofComplaint#

Actionon(a)and(b)(a)No.ofComplaintspendingat the

beginningoftheyear

(b)Noofcomplaintsreceivedduringthe

year

Resolved*NonActio-nable

Pending

Within 30Days

30-60Days

60-180Days

Beyond180days

0-3mths

3-6mths

6-9mths

9-12mths

I ANonreceiptofDividendonUnits

0 1 1 0 0 0 0 0 0 0 0

IB

Interest on delayedpaymentofDividend

0 0 0 0 0 0 0 0 0 0 0

I CNonreceiptofRedemptionProceeds

0 1 1 0 0 0 0 0 0 0 0

ID

Interest on delayedPaymentofRedemption

0 0 0 0 0 0 0 0 0 0 0

II A

NonreceiptofStatementofAccount/UnitCertificate

0 1 1 0 0 0 0 0 0 0 0

IIBDiscrepancyinStatementof Account

0 0 0 0 0 0 0 0 0 0 0

II C

Datacorrections inInvestordetails

0 0 0 0 0 0 0 0 0 0 0

IID

NonreceiptofAnnual Report /AbridgedSummary

0 0 0 0 0 0 0 0 0 0 0

III AWrongswitchbetweenSchemes

0 0 0 0 0 0 0 0 0 0 0

IIIB

UnauthorizedswitchbetweenSchemes

0 0 0 0 0 0 0 0 0 0 0

III CDeviationfromSchemeattributes

0 0 0 0 0 0 0 0 0 0 0

IIIDWrongorExcesscharges/load

0 0 0 0 0 0 0 0 0 0 0

IIIE

Nonupdationofchangesviz.address,PAN,bankdetails,nomination,etc

0 1 1 0 0 0 0 0 0 0 0

IV Others** 0 5 5 0 0 0 4 0 0 0 0

#includingagainstitsauthorizedpersons/distributors/employeesetc*Nonactionablemeansthecomplaintthatareincomplete/outsidethescopeofthemutualfundOthers**-1.NotpertainingtoSMF;2.FakeInvestormeetings;3.UnabletoRedeem;4.Nonreceiptofinterest;5.Seniorexecutivesofbigcorporate houses

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7. Role of Mutual Funds in Corporate Governance of Public Listed CompaniesPolicy for voting at AGM/EOGM/through E-voting/through Postal Ballot on resolutions recommended by investee companiesIntroductionSaharaAssetManagementCompanyPrivateLimitedactsasanInvestmentManager(“TheAMC”)totheschemesofSaharaMutual Fund (“Fund”).The general voting policy and procedures being followed by theAMC in exercising the voting rights(“VotingPolicy”)isgivenhereunder.Philosophy and Guidelines of Voting Policy:TheAMChasadualresponsibilityofaprudentFundManager investing investors’moneyaswellasofanentityperformingthe responsibility of protecting the investors’ interest. As part of the management of funds, irrespective of the scheme,theAMC ensures that investments are made in companies that meet investment norms. It is expected that the investeecompanyadherestopropercorporategovernancestandards.ThevotingpolicyfortheinvesteecompaniesbytheAMCisasunder:TheAMChasadualresponsibilityofaprudentFundManager investing investors’moneyaswellasofanentityperformingthe responsibility of protecting the investors’ interest. As part of the management of funds, irrespective of the scheme,theAMC ensures that investments are made in companies that meet investment norms. It is expected that the investeecompanyadherestopropercorporategovernancestandards.ThevotingpolicyfortheinvesteecompaniesbytheAMCisasunder:TheAMC shall deal with voting on case to case basis. For this purpose, theAMC shall review various notices ofAGM/EOGM/Postal Ballot received from the investee companies from time to time and take appropriate voting decision (for,against, abstain) with respect to the each resolution recommended by the management/ shareholders of the companies.The AMC would generally agree with the management of the Investee Company on routine matters, but may object byvotingagainstorabstain, if itbelieves that ithas insufficient informationor there isconflictof interestsor the interestof theshareholdersand/ortheunitholders’interestsareprejudicedinanymanner.As regards non-routine items, the Fund Manager (Equity) with assistance of the Equity Research Department and inconsultationwith theChief InvestmentOfficer shall review each of such cases andmake specific recommendations to theChief Executive Officer. In case theAMC is against any non routine item, it may decide to attend the meeting and voteagainst that item. In some other such cases, itmay decide to abstain based on one ormore of the factors like our smallholding in the company, location of the venueofmeeting, time/cost involved etc. For these instances, the reasons for nonattendancewillberecorded.As per the decision taken by the AMC, it may depute an authorized person to attend and vote at AGM/EOGM/throughE-Voting/ throughPostalBallot appropriately keeping inmind the interest of unit holders.AMCwouldmaintain a record ontheAGM/EOGMvotingrelatedmatters.Disclosure of Voting policy and Maintenance of Records:ThisPolicyon votingatAGM/EOGM/ throughe-voting/ throughpostal ballot and suitabledisclosure thereof is availableonthewebsite(www.saharamutual.com)oftheMutualFund.Note:FordetailsofvotingintheAGMsoftheinvesteecompaniesforthefinancialyear2015-16,unitholderscanlogontothewebsite(www.saharamutual.com)oftheFund.FurtherthesaiddetailsarealsoavailableintheAnnualReportofSaharaMutualFundfortheperiod2015-16.Thedetailsofvotingshallbeemailed/sentasandwhenrequestedbytheunitholdersfreeofcost.8. Statutory Information.a. TheSponsor isnotresponsibleor liableforany lossresultingfromtheoperationof theSchemesof theFundbeyondtheirinitialcontributionofRs.1lakhforsettinguptheFund.b. Thepriceandredemptionvalueoftheunits,andincomefromthem,cangoupaswellasdownwithfluctuationsinthemarketvalueofitsunderlyinginvestments.c. FullAnnual Report is disclosed on thewebsite (www.saharamutual.com) and shall be available for inspection at theHead Office of the Mutual Fund. Present and prospective unit holders can obtain copy of the trust deed, the full AnnualReport of the Fund / AMC free of cost.AcknowledgementsThe Trustees would like to thank all the investors for reposing their faith and trust in Sahara Mutual Fund. The Trusteesthank theSecuritiesandExchangeBoardof India, theReserveBankof India, theSponsor, theBoardof theSaharaAssetManagementCompanyPrivateLimitedfortheirsupport,co-operationandguidanceduringtheperiod.We are also thankful to theAuditors, Registrar andTransferAgents, Custodian, Banks, Depositories,AMFI/NISMCertifiedDistributors, KYC Registration Agencies and other service providers for their continuous support. The Trustees alsoappreciate theeffortsmadeby theemployeesofSaharaAssetManagementCompanyPrivateLimitedandplaceon recordtheircontributioningoodperformanceoftheschemes.We look forward for your continued support and assure you of our commitment at all times in managing the schemes ofSahara Mutual Fund.

For and on behalf of Sahara Mutual Fund

Sd/-Place:Mumbai S R HegdeDate :27thJune,2016 Trustee

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INDEPENDENT AUDITORS’ CERTIFICATE ON QUARTERLY DISCLOSURE OF VOTES CASTWe,Chaturvedi&Co,CharteredAccountants,Mumbai,theStatutoryAuditorsofSaharaMutualFund,haveforthepurposeofissuingthiscertificate,examinedthequarterlydisclosurestatementsofvotescastduringeachofthequartersofFY2015-16.

The Sahara Asset Management Company private Limited (the “AMC”) is responsible for preparation and maintenance ofrecordsofvoting reports inaccordancewith theprovisionsofSBEIcircularsasamended from time to timeand forensuringcompliancewithSEBIRegulationsandrelevantguidelines’issuedtotheAssetManagementCompanies.

Our responsibility for the purpose of the certificate is limited to certifying the particulars of the disclosures in the quarterlyvoting reports by examining relevant records and documents maintained by the AMC and produced before us andexplanationsandrepresentationsgiventous.

Onthebasisofourverificationoftherecordsandinformationproducedbeforeus,wecertifytothebestofourknowledgeandinformation provided to us that the detailsmentioned in the quarterly reports of the disclosure statement on the votes cast,are in agreementwith the record s/documentsmaintained by theAMC and the quarterly Voting reports are in linewith therequirementsoftheSEBIcirculars.

This certificate is being issued at the request of the management of theAMC for submission to the Board of Trustees ofSaharaMutualFundintermsofSEBIcirculardateMarch24,2014

For Chaturvedi & CoChartered Accountants

(FirmRegistrationNo.302137E)

Sd/-

(D S R Murthy)Place:Mumbai PartnerDate :25thMay2016 M.No018295

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INDEPENDENT AUDITOR’S REPORT

To the Trustees of Sahara Mutual Fund

Report on the Financial Statements

We have audited the accompanying financial statements of Sahara Mutual Fund – Sahara Infrastructure Fund (“theScheme”),whichcomprisetheBalanceSheetasatMarch31,2016,andtheRevenueAccountfortheyearthenended,andasummaryofsignificantaccountingpoliciesandotherexplanatoryinformation.

Management’s Responsibility for the Financial StatementsThe Trustees of SaharaMutual Fund and the Board of Directors of SaharaAsset Management Company Private Limited(the“Directors”)areresponsibleforthepreparationofthesefinancialstatementsthatgiveatrueandfairviewofthefinancialposition and financial performance of the Scheme in accordance with the accounting policies and standards specified inthe Ninth Schedule of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 (the “Regulations”)and amendments thereto, as applicable. This responsibility also includes maintenance of adequate accounting recordsfor safeguarding the assets of the Scheme and for preventing and detecting frauds and other irregularities; selection andapplication of appropriate accounting policies; making judgements and estimates that are reasonable and prudent; anddesign, implementationandmaintenanceofadequate internal financial controls, thatwereoperatingeffectively forensuringthe accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financialstatementsthatgiveatrueandfairviewandarefreefrommaterialmisstatement,whetherduetofraudorerror.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit.We have taken into accountthe Regulations, the applicable accounting standards and the Standards onAuditing issued by the Institute of CharteredAccountantsof India.ThoseStandards require thatwecomplywithethical requirementsandplanandperform theaudit toobtainreasonableassuranceaboutwhetherthefinancialstatementsarefreefrommaterialmisstatement.An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of materialmisstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internalfinancialcontrolsrelevant totheScheme’spreparationof thefinancialstatementsthatgiveatrueandfairviewinorder todesignauditproceduresthatareappropriate inthecircumstances,butnot for thepurposeofexpressinganopiniononwhether theSchemehas inplaceanadequate internalfinancialcontrolssystemoverfinancial reportingand theoperating effectiveness of such controls.An audit also includes evaluating the appropriateness of accounting policies usedandthereasonablenessoftheaccountingestimatesmadebytheDirectors,aswellasevaluatingtheoverallpresentationofthefinancialstatements.Webelievethattheauditevidencewehaveobtainedissufficientandappropriatetoprovideabasisforourauditopiniononthefinancialstatements.

OpinionInouropinionandtothebestofourinformationandaccordingtotheexplanationsgiventous,thefinancialstatementsgivethe informationrequiredbytheSecuritiesandExchangeBoardof India(MutualFunds)Regulations,1996andamendmentsthereto, asapplicable, in themanner so requiredandgivea trueand fair view in conformitywith theaccountingprinciplesgenerallyacceptedinIndia:(a) inthecaseoftheBalanceSheet,ofthestateofaffairsoftheSchemeasatMarch31,2016;(b) inthecaseoftheRevenueAccount,ofthesurplusfortheyearendedonthatdate.

Emphasis of MatterWedrawattentiontothefollowingmatterintheNotestothefinancialstatements:a) Note no. 8.18 states that during the financial year, SEBI had directed cancellation of “Certificate of Registration” of

SaharaMutualFundwhichwastobeeffectiveonexpiryofsixmonths fromthedateof theOrder.Further,SEBIalsodirected in the said Order that the Mutual Fund shall not take any new subscription from investors. Sahara AssetManagementCompanyPvt.Ltd.(SAMC)hadfiledanappealbeforetheSecuritiesAppellateTribunal(SAT)forastayagainst the SEBI Order. Subsequently an interim stay was granted and the matter is pending for decision with theSAT.ThisindicatestheexistenceofamaterialuncertaintythatmaycastsignificantdoubtaboutSaharaMutualFund’s

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ability to continue as a going concern. However, the financial statements of the Scheme have been prepared on agoingconcernbasis,pendingthedecisionfromSAT.

Ouropinionisnotmodifiedinrespectoftheabovematter.

Report on Other Legal and Regulatory RequirementsAsrequiredby theSecuritiesandExchangeBoardof India (MutualFunds)Regulations,1996andamendments thereto,asapplicable,wereportthat:a) Wehaveobtainedall theinformationandexplanations,whichtothebestofourknowledgeandbeliefwerenecessary

for the purpose of our audit. b) TheBalanceSheetandRevenueAccountdealtwithbythisReportareinagreementwiththebooksofaccountofthe

Scheme.c) The statement of account has been prepared in accordancewith the accounting policies and standards specified in

theNinthScheduleoftheSecuritiesandExchangeBoardofIndia(MutualFunds)Regulations,1996andamendmentsthereto,asapplicable.

d) Wehave reviewed theValuationPolicybeing followed for theschemesofSaharaMutualFund.TheValuationPolicyimplementedfortheschemeisinlinewiththeSEBIguidelinesissuedinthisregard.

For Chaturvedi & Co. Chartered Accountants (Firm’sRegistrationNo.302137E)

(D S R Murthy) (Partner) Mem.No.018295

Place:MumbaiDate :27thJune,2016

“Specific point of NoteNo.8.18made in the IndependentAuditorsReport bears reference to theNotes toAccounts of theFullAnnualAccounts of the respective schemes of Sahara Mutual Fund”. The said point is covered at point no. 7 in theNotestoAccountsofthisAAR.

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ABRIDGED BALANCE SHEET AS AT 31ST MARCH, 2016(`inlakhs)

Sahara Infrastructure Fund As at ended 31/03/2016

As at ended31/03/2015

LIABILITIES1 Unit Capital 256.42 304.882 Reserves & Surplus2.1 UnitPremiumReserve (18.84) (15.50)2.2 UnrealisedAppreciationReserve 62.99 90.682.3 OtherReserves 111.88 132.47 3 Loans & Borrowings – –4 Current Liabilities & Provisions4.1 ProvisionfordoubtfulIncome/Deposits – –4.2 OtherCurrentLiabilities&Provisions 10.57 33.44 TOTAL 423.02 545.97 ASSETS1 Investments1.1. Listed Securities:1.1.1 EquityShares 406.60 504.191.1.2 PreferenceShares – –1.1.3 EquityLinkedDebentures – –1.1.4 OtherDebentures&Bonds – –1.1.5 SecuritisedDebtsecurities – –1.2 Securities Awaited Listing:1.2.1 EquityShares – –1.2.2 PreferenceShares – –1.2.3 EquityLinkedDebentures – –1.2.4 OtherDebentures&Bonds – –1.2.5 SecuritisedDebtsecurities – –1.3 Unlisted Securities1.3.1 EquityShares – –1.3.2 PreferenceShares – –1.3.3 EquityLinkedDebentures – –1.3.4 OtherDebentures&Bonds – –1.3.5 SecuritisedDebtsecurities – –1.4 GovernmentSecurities – –1.5 TreasuryBills – –1.6 CommercialPaper – –1.7 CertificateofDeposits – –1.8 BillRediscounting – –1.9 UnitsofDomesticMutualFund – –1.10 ForeignSecurities – – Total Investments 406.60 504.192 Deposits3 Other Current Assets3.1 Cash&BankBalance 7.97 29.943.2 ReverseRepoLending – –3.3 CollateralizedBorrowingandLendingObligation(CBLO) – 3.193.4 Others 8.45 8.654 Deferred Revenue Expenditure

(totheextentnotwrittenoff)– –

TOTAL 423.02 545.97 NotestoAccounts-AnnexureI

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ABRIDGED REVENUE ACCOUNT FOR THE YEAR / PERIOD ENDED 31ST MARCH, 2016(`inlakhs)

Sahara Infrastructure FundCurrent

Year / Period ended 31/03/2016

PreviousYear/Period

ended31/03/2015

1 INCOME1.1 Dividend 6.51 6.46

1.2 Interest 0.48 1.27

1.3 RealisedGain/(Loss)onForeignExchangeTransactions – –

1.4 RealisedGains/(Losses)onInterschemesaleofinvestments – –

1.5 RealisedGains/(Losses)onExternalsale/redemptionofinvestments

17.04 168.78

1.6 RealisedGains/(Losses)onDerivativeTransactions – –

1.7 OtherIncome – –

( A ) 24.03 176.51 2 EXPENSES 2.1 Managementfees 6.48 4.032.2 ServicetaxonManagementfees 0.90 0.502.3 InvestorEducation&AwarenessFees 0.09 0.112.4 Transferagentsfeesandexpenses 0.78 2.522.5 Custodian fees – 1.382.6 Trusteeshipfeesandexpenses – 0.722.7 CommissiontoAgents – 0.382.8 Marketing&Distributionexpenses – 0.312.9 Audit fees – 1.602.10 DeferredRevenueExpenditure – –2.11 Otheroperatingexpenses 0.15 0.84

(B ) 8.40 12.383 NET REALISED GAINS / (LOSSES) FOR THE YEAR / PERIOD

(A -B = C)15.63 164.12

4 ChangeinUnrealisedDepreciationinvalueofinvestments (D) 4.70 12.32 5 NET GAINS / (LOSSES) FOR THE YEAR / PERIOD

(E=(C-D))10.93 151.80

6 Changeinunrealisedappreciationinthevalueofinvestments (F) 90.68 73.267 NET SURPLUS / (DEFICIT) FOR THE YEAR / PERIOD

(E + F = G)101.61 225.06

7.1 Add:BalancetransferfromUnrealisedAppreciationReserve (27.68) 17.42 7.2 Less:BalancetransfertoUnrealisedAppreciationReserve 63.00 90.687.3 Add:IncomeEqualisationReserve (31.53) (18.53)8 Total (20.60) 133.27 9 Dividend appropriation – –9.1 IncomeDistributedduringtheyear/period – –9.2 Taxonincomedistributedduringtheyear/period – –10 RetainedSurplus/(Deficit)carriedforwardtoBalancesheet (20.60) 133.27

Otheroperatingexpensesincludetransactioncosts.NotestoAccounts–Annexure1

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NOTES TO ACCOUNTS – ANNEXURE 1 TO THE ABRIDGED BALANCE SHEET AND REVENUE ACCOUNT FOR THE YEAR / PERIOD ENDED 31ST MARCH, 2016

1. Investments :-1.1 Certain investmentsareregisteredinthenameoftheFundwithoutspecificreferencetotheScheme.AsatMarch31,2016

the aggregate market value of securities under Sahara Infrastructure Fund but held in the name of Sahara Mutual FundbeinginvestedinCBLOis` Nil(P.Y.` 3,19,568.92).

1.2 During theyearended31.03.2016 theRegistrarandTransferAgentschargesamounting to` 78210.51 (P.Y.` 251860.00)constitutes9.31%(P.Y.20.33%)andthecustodyfeesamountingto` Nil(P.Y.` 1,37,533.58)constitutesNil%(P.Y.11.10%)ofthetotalschemesexpenses.

1.3 OpenPositionofderivatives(outstandingmarketvalue&%toNetAssetsasoftheYearend).Nil1.4 Investments inAssociates andGroupCompanies: Provide details of issuer, nature of instruments, amount, and aggregate

investmentsbyallschemes.Nil1.5 OpenpositionofSecuritiesBorrowedand/orLendingbythescheme.Nil1.6 DetailsofNPA:Aggregatemarketvalueandprovisionthereof.Nil1.7 AggregateUnrealisedGain/LossasattheendoftheFinancialYear/Periodandpercentagetonetassets.

Asset Class

31-Mar-16 31-Mar-15Appreciation

(` in lakhs)

% to Net

Assets

Depreciation (` in lakhs)

% to Net

Assets

Appreciation (` inlakhs)

%toNet

Assets

Depreciation(` inlakhs)

%toNet

AssetsEquityShares 62.99 15.27 18.77 4.55 90.68 17.69 14.07 2.74

1.8 AggregateValueofPurchaseandSalewithPercentagetoaverageassets.

Purchases

Year Amount in ` % of Daily Average2015-16 23,698,903 51.002014-15 78,739,551 144.80

Sales

Year Amount in ` % of Daily Average2015-16 31,923,432 68.702014-15 92,402,778 169.93

1.9 Non-Traded securities in the portfolio: Provide Aggregate Value of Equity, Debt & Money Market Instruments andpercentagetonetassets.

Scheme Name Category31-Mar-16 31-Mar-15

Market value (` in lakhs)

% to Net Assets

Marketvalue(` inlakhs)

%toNetAssets

Sahara Infrastructure

Fund

Money Market Instruments (CBLO) 0.00 0.00 3.20 0.62

2. Details of Transaction withAssociates under regulation 25(8) Brokerage to SIFCLA/c CMSD (Associate) has beenmadeforsaleofunitsoftheMFason31stMarch2016

Commission to SIFCL A/c CMSD (Associate) made for sale of units of the MF for the current year ended 31st March 2016.

(` in lakhs)

Tax Gain Fund Growth Fund Liquid Fund Mid cap

FundWealth Plus

FundShort Term

Bond**Infrastructure

Fund

0.20 0.02 0.00 0.06 0.00 NotApplicable 0.02

14

(` in lakhs)Star Value

FundSuper 20

FundPower and Natural Resources Fund

Banking & Financial Services Fund Income Fund**

0.00 0.00 0.00 0.09 NotApplicable **Theschemewaswoundupon14thDecember,2015. Commission to SIFCL A/c CMSD (Associate) made for sale of units of the MF for the previous year ended 31st March 2015.

(` in lakhs)Tax Gain

Fund Growth Fund Liquid Fund Mid cap Fund

Wealth Plus Fund

Short Term Bond

Infrastructure Fund

0.33 0.06 0.02 0.10 0.01 0.00 0.06

(` in lakhs)Star Value

FundSuper 20

FundPower and Natural Resources Fund

Banking & Financial Services Fund Income Fund

0.01 0.01 0.00 0.33 0.01

Commission paid to associates / related parties /group companies of Sponsor/AMC

Name of associate / related parties /

group companies of Sponsor / AMC

Nature of association /

nature of relationPeriod Covered

Business given (` cr and % of total

business received by the fund)

Commission paid (` & % of total

commission paid by the fund

(1) (2) (3) (4) (5)

SIFCL A/c CMSD Sponsor / Mutual Fund Distributor April 15-March 16 (` 0.04 & 0.39%) (` 39963.98;

11.49%)

SIFCLA/cCMSD Sponsor / Mutual FundDistributor April14-March15 (` 0.29&0.36%) (` 93537.78;

8.80%)

IncolumnNo4,thetotalbusinessreceivedbythefundincludesbusinessthroughARNs&alsodirectbusiness. IncolumnNo5,theamountincludestheupfrontandthetrail.

Brokerage paid to associates / related parties / group companies of Sponsor/AMC

Name of associate / related parties /

group companies of Sponsor / AMC

Nature of association /

nature of relation

Period Covered

Value of Transaction (in `, Cr & of Total value of Transaction of the Fund)

Brokerage (` Cr & % of total

brokerage paid by the Fund)

– – – – –

Therearenoassociatebrokers,hencenotapplicablefortheperiodApril–Mar2016&April–Mar2015.

3. Large Holdings in the Scheme (i.e. in excess of 25% of the net assets): Nil4. Unit Capital movement during the year ended / period ended March 31, 2016 (Face Value of Units: ` 10/- per unit)

Fixed Pricing Option - Growth Option

Number of Units Amount (`) NumberofUnits Amount(`)As on

31-Mar-16As on

31-Mar-16As on

31-Mar-15As on

31-Mar-15Initial Capital 3908842.083 39088420.83 3908842.083 39088420.83OpeningBalance 563395.604 5633956.04 710097.581 7100975.81UnitsSoldduringtheyear 2273.219 22732.19 25531.623 255316.23UnitsRepurchasedduringtheyear (127111.978) (1271119.78) (172233.600) (1722336.00)

ClosingBalance 438556.845 4385568.45 563395.604 5633956.04

15

Fixed Pricing Option - Growth Option - Direct


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on

31-Mar-15Initial Capital 0.00 0.00 - -OpeningBalance 3670.075 36700.75 3422.391 34223.91UnitsSoldduringtheyear 1060.704 10607.04 6429.192 64291.92UnitsRepurchasedduringtheyear (4669.660) (46696.60) (6181.508) (61815.08)

ClosingBalance 61.119 611.19 3670.075 36700.75

Fixed Pricing Option - Dividend Option


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on

31-Mar-15Initial Capital 3999162.348 39991623.48 3999162.348 39991623.48OpeningBalance 683489.707 6834897.07 884751.766 8847517.66UnitsSoldduringtheyear 583.857 5838.57 17078.719 170787.19

UnitsRepurchasedduringtheyear (105712.921) (1057129.21) (218340.778) (2183407.78)

ClosingBalance 578360.643 5783606.43 683489.707 6834897.07

Fixed Pricing Option - Dividend Option- Direct

Number of Units Amount (`) NumberofUnits Amount(`)

As on 31-Mar-16

As on 31-Mar-16

As on 31-Mar-15

As on 31-Mar-15

Initial Capital 0.00 0.00 0.00 0.00

OpeningBalance 10948.805 109488.05 5235.328 52353.28

UnitsSoldduringtheyear 0.000 0.00 7563.057 75630.57


ClosingBalance 5474.359 54743.59 10948.805 109488.05

Variable Pricing Option – Growth Option


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on



ClosingBalance 741637.654 7416376.54 875645.134 8756451.34

16

Variable Pricing Option – Growth Option – Direct


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on



ClosingBalance 38699.241 386992.41 45275.832 452758.32

Variable Pricing Option – Dividend Option


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on



ClosingBalance 759267.843 7592678.43 854301.314 8543013.14

Variable Pricing Option – Dividend Option (Direct)


31-Mar-16As on

31-Mar-16As on

31-Mar-15As on



ClosingBalance 2118.920 21189.20 12116.297 121162.97

5. Expensesotherthanmanagementfeeisinclusiveofservicetaxwhereapplicable.

6. Previous year figures have been reclassified/regrouped, wherever necessary, to conform to the current year’sclassification. The bifurcation of expenses of the schemes has been revised for the current year.As a result of thisrevision, theexpensescharged to theRevenueAccountof theschemesunderdifferentheadsofexpenditure for theyear would not be comparable with the previous year. However, the total expenses are within the limit prescribedunderRegulation52(6)&(6A)oftheSEBI(MutualFund)Regulations,1996asamendedfromtimetotime.

7. SEBI vide its Order no: WTM/PS/26/IMD/DOF-III/July/2015 dated 28th July, 2015 had directed cancellation of“Certificate of Registration” of SaharaMutual Fundwhichwas to be effective on expiry of sixmonths from the dateof theOrder.Further,SEBIalsodirectedby thesaidOrder that theMutualFundshallnot takeanynewsubscriptionfrominvestors.Accordingly, theMutualFundhasnottakenanynewsubscriptionfromtheinvestors(includingexistinginvestors)inlinewiththesaidSEBIorder.

SaharaAssetManagementCompanyPvt.Ltdfiledanappealbefore theSecuritiesAppellateTribunal (SAT),Mumbaito set aside the saidSEBIorder.SATvide its order dated9thDecember, 2015grantedan interimstay in thematter.Theappealispendingfordecision/disposalwiththeSAT.

8. ContingentLiability:Nil

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

17

KEY STATISTICS FOR THE YEAR / PERIOD ENDED 31ST MARCH, 2016

SAHARA INFRASTRUCTURE FUND Current Year / Period ended 31/03/2016

PreviousYear/Periodended31/03/2015

Open FixedPricing-DividendPlan 13.6148 9.9134 FixedPricing-GrowthPlan 18.6260 13.5605 VariablePricing-DividendPlan 14.7449 10.6211 VariablePricing-GrowthPlan 20.0429 14.4557 FixedPricing-DirectDividendPlan 13.6851 9.9405 FixedPricing-DirectGrowthPlan 18.6728 13.6040 VariablePricing-DirectDividendPlan 14.8114 10.6548 VariablePricing-DirectGrowthPlan 20.0905 14.4999

Repurchase Price during the year** (i) Highest FixedPricing-DividendPlan 14.1505 14.3702 FixedPricing-GrowthPlan 19.3588 19.6592 VariablePricing-DividendPlan 15.3360 15.5506 VariablePricing-GrowthPlan 20.8464 21.1381 FixedPricing-DirectDividendPlan 14.2250 14.4416 FixedPricing-DirectGrowthPlan 19.4094 19.7049 VariablePricing-DirectDividendPlan 15.4053 15.6177 VariablePricing-DirectGrowthPlan 20.8959 21.1846(ii) Lowest FixedPricing-DividendPlan 12.9950 9.7711 FixedPricing-GrowthPlan 17.7784 13.3658 VariablePricing-DividendPlan 14.0929 10.4710 VariablePricing-GrowthPlan 19.1568 14.2516 FixedPricing-DirectDividendPlan 13.0649 9.7983 FixedPricing-DirectGrowthPlan 17.8266 13.4095 VariablePricing-DirectDividendPlan 14.1565 10.5049 VariablePricing-DirectGrowthPlan 19.2028 14.2958

Resale Price during the year** (i) Highest FixedPricing-DividendPlan 14.6150 14.8420 FixedPricing-GrowthPlan 19.9943 20.3046 VariablePricing-DividendPlan 15.8394 16.0611 VariablePricing-GrowthPlan 21.5308 21.8320 FixedPricing-DirectDividendPlan 14.3687 14.5875 FixedPricing-DirectGrowthPlan 19.6055 19.9039 VariablePricing-DirectDividendPlan 15.5609 15.7755 VariablePricing-DirectGrowthPlan 21.1070 21.3986

18

SAHARA INFRASTRUCTURE FUND Current Year / Period ended 31/03/2016

PreviousYear/Periodended31/03/2015

(ii) Lowest FixedPricing-DividendPlan 13.4216 10.0919 FixedPricing-GrowthPlan 18.3621 13.8046 VariablePricing-DividendPlan 14.5556 10.8148 VariablePricing-GrowthPlan 19.7857 14.7195 FixedPricing-DirectDividendPlan 13.1969 9.8973 FixedPricing-DirectGrowthPlan 18.0067 13.5449 VariablePricing-DirectDividendPlan 14.2995 10.6110 VariablePricing-DirectGrowthPlan 19.3968 14.4402 End FixedPricing-DividendPlan 12.8912 13.6148 FixedPricing-GrowthPlan 17.6536 18.6260 VariablePricing-DividendPlan 14.2521 14.7449 VariablePricing-GrowthPlan 19.3739 20.0429 FixedPricing-DirectDividendPlan 13.0063 13.6851 FixedPricing-DirectGrowthPlan 17.7711 18.6728 VariablePricing-DirectDividendPlan 14.3501 14.8114 VariablePricing-DirectGrowthPlan 19.5134 20.09052. ClosingAssetsUnderManagement(` inLakhs) End 412.45 512.54 Average(AAuM)4 464.67 543.773. Grossincomeas%ofAAuM1 5.17% 32.46%4. ExpenseRatio: a. TotalExpenseas%ofAAuM 1.81 2.28 b. ManagementFeeas%ofAAuM 1.59 0.835. NetIncomeasapercentageofAAuM2 3.36% 30.18%6. Portfolioturnoverratio3 0.51 1.457. TotalDividendperunitdistributedduringtheyear/period NIL NIL8. Returns(%): a. Last One Year VariablePricingOption-GrowthOption - 3.3378 38.6505 FixedPricingOption-GrowthOption - 5.2207 37.3548 Nifty50Index - 8.8635 26.6520 b. Since Inception VariablePricingOption-GrowthOption 6.8370 8.0342 FixedPricingOption-GrowthOption 5.8482 7.1575 Nifty50Index 8.3405 10.4456

** basedonthemaximumloadduringtheyear1. Grossincome=amountagainst(A)intheRevenueaccounti.e.Income.2. Netincome=amountagainst(C)intheRevenueaccounti.e.NetRealisedGains/(Losses)fortheYear/Period3. PortfolioTurnover=LowerofsalesorpurchasedividedbytheAverageAuMfortheyear/period.4. AAuM=AverageAssetsunderManagement.

SchemeCode:IN

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