Marketing material for professional investors or advisers only

Karan Datta - Chief Business Officer, Axis Asset Management

Ashwin Patni - Fund Manager & Head of Products, Axis Asset Management

Jigar Gandhi - India Investment Specialist, Axis Asset Management

Resurgent India

March 2018

What we intend to cover today

Why India? Why Schroders? Why now?

1

Indian Equity as an asset class

3

Source: Bloomberg, data as at 31 December 2017.

Indian market performance stands out over short term as well as long term

37.0%

7.2% 7.3% 8.8%

34.3%

6.6%

1.9%

4.0%

20.1%

7.2%

9.5%

4.4%

21.6%

7.1%

8.6%

4.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%

1 year 3 Years 5 Years 20 yearsMSCI India MSCI EM MSCI World MSCI ACWI

Variation in top and bottom stocks over the last 10 years

% compound annual growth rate (CAGR)

CY 07–17

Top quartile 17.9

BSE 100 index 5.9

Bottom quartile (16.9)

Our strategy relies on bottom up selection of quality companies that can deliver sustainable growth

Source: Bloomberg, Axis AMC Analysis Past performance may or may not be sustained in future. Data as on 30 November 2017.

High dispersion in performance of stocks favours active managers

4

– Leading companies tend to grow faster, capture disproportionate part of profit pool

– Large dispersion in performance between quality stocks and rest of market

– Bottom-up strategies perform well

5

Source of data: CRISIL, NSE, data as at 31st Dec 2017. Returns in INR

Active managers have outperformed in India

10 years performance (% pa)

CRISIL-AMFI Equity Fund Performance Index 8.9%

Nifty 50 Index 5.5%

Large Cap vs. Midcap

6

Source: MFI Explorer, data as at 28th Feb 2018. Returns in INR

Large mid cap opportunity available

5.6

13.0

7.1

14.4

21.1

10.5

0

5

10

15

20

25

3 Years 5 Years 10 Years

Nifty 50 Nifty Free Float Midcap 100

(%)

India-focused offshore funds are

seeing strong flows

Active funds get a higher share unlike

other markets

Source: Morningstar Offshore Fund Spy report, as at 31st Dec 2017

- Total assets in India focussed offshore funds grew from USD 33 bn to USD 65 bn

- However, the share of passive funds (ETFs) has been on downward trend

- % of ETFs in total India focussed offshore funds, fell to 19.7% as compared 25% (2 years back)

Yearly estimated net flows (USDbn)

7

2.5

4.3

-2.5

6.5

2014 2015 2016 2017

Why does a dedicated India allocation for foreign investors make sense?

8

Source: Axis AMC.

Well run companies that are profitable and efficient capital

allocators

Large, growing economy/market that is under-represented in regional/global benchmarks

Breadth in mid-cap space not typically captured by regional

managers

Why now?

Economic management and reforms since 2014

– Improving macro – stable inflation, low rates, contained deficits

– Strong external account – record FX reserves, stable Rupee, low current account deficit (CAD)

– Reforms – goods and services tax (GST), bankruptcy, Real Estate Regulatory Act (RERA)

– Global interest – Moody’s upgrade, World Bank ease of doing business, record FDI flows

Source: Axis AMC. 10

Currency (USD/INR) Fiscal Deficit (% GDP)

Inflation (%) Current Account Deficit (% GDP)

11

Source: Bloomberg, data as at 28th Feb 2018

Supported by robust macro indicators

58

60

62

64

66

68

70

Jan-14 Jan-15 Jan-16 Jan-17 Jan-18

0

1

2

3

4

5

6

7

Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 Jan-14 Jan-16 Jan-18

0

2

4

6

8

10

12

Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Jan-18

-6

-5

-4

-3

-2

-1

0

Dec-07 Dec-09 Dec-11 Dec-13 Dec-15

Nifty Earnings Growth

12

Source: CLSA, data as at 31 December 2017. 1 CL – CLSA estimate

Economy, earnings growth are likely to stabilise post recent disruptions

7%

10%

3%

-4%

8%

14%

21%

16%

-10%

-5%

0%

5%

10%

15%

20%

25%

FY13 FY14 FY15 FY16 FY17 FY18CL FY19CL FY20CL1

Average 16.1

7

9

11

13

15

17

19

21

23

Feb-06 Feb-08 Feb-10 Feb-12 Feb-14 Feb-16 Feb-18

Nifty Best P/E Average

Average 16.1

Nifty 50 Index Forward P/E

13

Source: Bloomberg, P/E – Price to Earnings. Data as at 28th Feb 2018.

Valuations are high relative to history, however earnings growth kicking in will help normalise

FII and DII Flows (USDmn)

14

Source: Bloomberg, Kotak Institutional Equities, data as at December 2017. FII- Foreign Institutional Investor. DII – Domestic Institutional Investors (Includes Bank, DFIs, Insurance, New Pension Scheme and MF).

Domestic savings finally flowing into stocks, should support market from global liquidity swings

24,548

19,754 16,162

3,274 2,903

7,533

(10,854) (12,942)

(5,090)

10,315

5,425

14,092

-17,000

-12,000

-7,000

-2,000

3,000

8,000

13,000

18,000

23,000

28,000

CY 12 CY 13 CY 14 CY 15 CY 16 CY 17

FII Domestic

Factors to watch out for in 2018

15

Source: Axis AMC.

8879.6 Micro factors : Revival in Ministry of Micro, Small and Medium

Enterprises (MSME) and Small and Medium Enterprises (SME) sectors post GST and higher government

spends

Macro factors : Oil prices, Inflation and Interest Rates

Pick up in rural India especially after a couple of years of bad

monsoon and low income levels as MSP and rural infra was curtailed

Why Schroders and Axis?

Schroders has well positioned Indian equity capabilities

17

Source: Schroders. *Schroder International Selection Fund is referred to as Schroder ISF throughout this presentation.

Product Schroder ISF* Indian Equity Schroder ISF Indian Opportunities

Objective Outperform the index by 2% p.a. To be a top performer and outperform the index by > 4% p.a.

Team Managed by Schroders with input from Axis Advised by Axis – Axis responsible for performance

Cap Bias Large cap Diversified, all cap

# of Stocks 40–60 stocks 30–70 stocks

T.E. 2%–5% 4%–10%

– Axis Asset Management Company was set up in January 2009 as a wholly-owned subsidiary of Axis Bank

– Axis Bank is the third largest private sector Bank in India

– Expansive distribution network in 3,589 domestic branches and 13,977 ATMs across the country

– Management team with extensive experience

– One of the fastest growing asset managers in India with close to USD 12bn in AuM

– Schroders acquired a 25% stake in September 2012

– Manages local funds under the Axis Mutual Fund range and advises Schroders on its global India product range

18

Source: Axis AMC, Axis Bank, Axis AMC AuM data as at 28 Feb 2018, Axis Bank data as of 31 Dec 2017.

About Axis Asset Management Company

– Axis is a bottom-up investor that focuses on fundamental research driven investing

– Our philosophy is focused on identifying quality companies that have a sustainable medium to long term growth potential run by capable managements

19

Source: Axis AMC. For illustrative purpose only.

Key pillars of Axis approach

Aim to deliver superior risk adjusted returns

High conviction investors

Growth biased – focusing on

sustainable growth

Look for quality businesses

The 4 stage equity investment process

20

Source: Axis AMC.

Identify universe

Identify companies with sustainable earnings growth potential, credible management and acceptable liquidity

Analyze fundamentals to assess fair value of stocks in our universe

Portfolio is constructed bottom-up, stock-by-stock while adhering to top-down risk parameters, liquidity profile and volatility targets

Take profit or re-balance portfolio to ensure investment objectives are met. Examine need for hedging against event risks

Risk management

Research

Portfolio construction

Portfolio monitoring

Risk management is central to the investment process

21

Source: Axis AMC.

Prudent product design to reduce risk

Disciplined investment process which is clearly articulated and focused on risk

Portfolios are regularly tracked across various parameters like tracking error, information ratio, volatility and downside risk

Product level

Process level

Risk monitoring

Schroders’ India funds: Performance summary As at 28 February 2018 (In USD)

22

Source: Schroders. Returns quoted are based on A Accumulated Share Class, dividend re-invested, net of fees. Since Inception date: 10 November 2006. For illustrative purpose only. Past performance is not a guide to future performance and may not be repeated.

Schroder ISF Indian Equity In USD, net of fees

3 months %

6 months %

YTD %

1 year %

3 years % p.a.

5 years % p.a.

Since inception

% p.a.

Fund 2.1% 4.8% -1.5% 23.6% 6.7% 12.6% 7.4%

MSCI India Net TR 1.2% 3.9% -3.5% 21.2% 4.1% 8.7% 5.6%

Excess returns 0.9% 0.9% 2.0% 2.4% 2.6% 3.9% 1.8%

Discrete Yearly Performance (%)

Q4/2016 -Q4/2017 Q4/2015 - Q4/2016 Q4/2014 - Q4/2015 Q4/2013 - Q4/2014 Q4/2012 - Q4/2013

Fund 36.7% -0.6% -3.1% 30.4% 0.9%

MSCI India Net TR 38.8% -1.4% -6.1% 23.9% -3.8%

Excess returns -2.1% 0.8% 3.0% 6.5% 4.7%

Risk Considerations Risk Considerations – Schroder ISF Indian Equity The capital is not guaranteed. In order to access restricted markets, the fund may invest in structured products. Should the counterparty default, the value of these structured products may be nil. Investments denominated in a currency other than that of the share-class may not be hedged. The market movements between those currencies will impact the share-class. The fund will not hedge its market risk in a down cycle. The value of the fund will move similarly to the markets. Emerging markets will generally be subject to greater political, legal, counterparty and operational risk. Emerging equity markets may be more volatile than equity markets of well established economies. Investments into foreign currencies entail exchange risks. The fund may hold indirect short exposure in anticipation of a decline of prices of these exposures or increase of interest rate.

23

Schroders’ India funds: Performance summary As at 28 February 2018 (In USD)

24

Source: Schroders. Returns quoted are based on A Accumulated Share Class, dividend re-invested, net of fees. Since Inception date: 10 September 2013.For illustrative purpose only. Past performance is not a guide to future performance and may not be repeated.

Schroder ISF Indian Opportunities 3 months

% 6 months

% YTD

% 1 year

% 3 years

% p.a. 5 years

% p.a. Since inception

% p.a.

Fund 0.8% 5.6% -4.4% 28.8% 7.1% NA 17.3%

MSCI India Net TR 1.2% 3.9% -3.5% 21.2% 4.1% NA 12.4%

Excess returns -0.5% 1.7% -0.9% 7.6% 3.1% NA 4.9%

Discrete Yearly Performance (%)

Q4/2016 -Q4/2017 Q4/2015 - Q4/2016 Q4/2014 - Q4/2015 Q4/2013 - Q4/2014 Q4/2012 - Q4/2013

Fund 47.3% -7.7% -2.1% 37.8% NA

MSCI India Net TR 38.8% -1.4% -6.1% 23.9% NA

Excess returns 8.5% -6.3% 4.0% 13.9% NA

Risk Considerations Risk Considerations – Schroder ISF Indian Opportunities The capital is not guaranteed. Investments denominated in a currency other than that of the share-class may not be hedged. The market movements between those currencies will impact the share-class. Investments in small companies can be difficult to sell quickly which may affect the value of the fund and, in extreme market conditions, its ability to meet redemption requests upon demand. The fund will not hedge its market risk in a down cycle. The value of the fund will move similarly to the markets. The fund will be subject to the respective market movements of a limited number of sectors and/or countries of the investment universe. The fund may invest in other regions than the primary universe of the Fund resulting in an additional currency and interest rate risk. Emerging markets will generally be subject to greater political, legal, counterparty and operational risk.

25

An emerging opportunity

Indian Fixed Income

Risk Return Tradeoff

27

Bloomberg Barclays US Treasury Index

Bloomberg Barclays Global Aggregate Unhedged Index

JP Morgan GBI EM Broad Diversified Index

JP Morgan Emerging Market USD denominated Bond

index

Indian Bond Market – CRISIL Composite Bond

Fund Index (USD)

-1%

0%

1%

2%

3%

4%

5%

6%

-1% 1% 3% 5% 7% 9% 11%

Source: Schroders, Bloomberg, Axis AMC Internal Analysis. All returns are annualized and mentioned in terms of USD net of fees. Data as at 31 December 2017.

Indian market has delivered attractive risk adjusted performance relative to Emerging Markets (EM), Global markets

5 yr

Ret

urns

(ann

ualiz

ed)

Risk (Std Dev – 5 yr)

28

Source: Bloomberg, Axis AMC Internal Analysis. All returns are annualized and mentioned in terms of USD net of fees. Data as on 31 December 2017. Past performance is not a guide to future performance and may not be repeated.

Axis India bond funds performance relative to EM, HY strategies

15.0%

9.1%

6.7%

13.2%

4.1%

1.9%

8.7%

6.1%

4.5%

8.0% 7.0% 6.4%

0%

2%

4%

6%

8%

10%

12%

14%

16%

1 year 3 years 5 years

India Bond - Axis Regular Savings Fund (Likely average B-) Asian Local Currency Bond (A-)

Emerging Market Bond (BB) Global High Yield (BB-)

Return (%)

Key drivers that make Indian Bond market attractive for foreign investors

29

Source: Axis AMC Internal Analysis.

Economic diversification

India’s Rate Cut cycle is different from other

markets

Indian markets offer lucrative yields as

compared to other emerging markets

India has no/minimal weight in widely followed

global bond indices

Improving corporate bond market with a wide array of investment options across

ratings and maturities

Competitive yields

Portfolio diversification

Depth of Indian bond

market

iBoxx Asian Local Currency Bond Index (Top country weights)

30

Source: Schroders. Data as on 26 February 2018.

…Yet India is under represented Offers a great diversification to global bond portfolios

19.9

13.7

13.7 7.3

45.4

South Korea China Singapore India Others

– Foreign holdings of Indian bond market have increased sharply over the past few years, rising from USD21bn at the end of 2013 to USD70bn in December 2017

– Yet, it is still one of the lowest in Asia with offshore investors owning only 5% of the outstanding stock

31

Note: NSDL FPI Monitor. Data as on 28 February 2018.

Foreign investors continue to show interest in Indian bond market

0

20

40

60

80

100

120

Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Feb-18

Coporate Bonds G-Sec

Rising FPI investments in Debt

Government securities (G-sec)

– Quota

– Accessing local trading platforms difficult for foreign investors

– Lack of secondary market liquidity

– For trading, secondary market is more active for G-sec, which records a daily trading volume of USD 6–8bn. However, daily corporate bond trading is relatively low at USD 0.5–1bn

– Relatively higher trading costs

32

Source: Axis AMC Internal Analysis, HSBC. Data as on 31 January 2018.

However, foreign investors find it difficult to invest in Indian bond market

33

Source of data: ACEMF, Bloomberg, RBI, BIS, 2013 refers to 31 August 2013 and current refers to latest data as on 28 February 2018.

Indian economy has built macro resilience since taper crisis

Taper crisis (2013) Current

CPI inflation 9.5% 5.1%

FX reserves (USDbn) 275.5 421.7

Current account deficit -4.7% -1.4%

Fiscal deficit -4.8% -4.0%

Crude oil (per barrel) $116.2 $65.8

Currency (INR) 65.7 65.2

Real rates (%)

34

Source: Bloomberg. Data as on 31 December 2017.

Better inflation management has led to investors getting positive real rates

-4

-3

-2

-1

0

1

2

3

4

5

6

Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17

35

Source of data: Trading economics, Data available as on 28 February 2018.

India offers competitive yields against other EM

Country GDP Policy Rate Inflation 10 year yield

Turkey 11.10% 8.00% 10.35% 11.62%

Brazil 2.10% 6.75% 2.86% 9.57%

South Africa 0.80% 6.75% 4.40% 8.20%

Russia 1.80% 7.50% 2.20% 7.08%

India 7.20% 6.00% 5.07% 7.75%

Indonesia 5.19% 4.25% 3.18% 6.61%

Philippines 6.60% 3.00% 4.00% 6.79%

China 6.80% 4.35% 1.50% 3.87%

Malaysia 5.90% 3.25% 2.70% 4.03%

Thailand 4.00% 1.50% 0.42% 2.40%

Singapore 3.60% 0.83% 0.00% 2.34%

Currency vs. US Dollar (5 years)

36

Source: Bloomberg. Data as on 28 February 2018.

Indian Rupee continues to be amongst the strongest EM currencies

-53%

-46%

-39%

-30%

-23% -22% -21%

-16%

-6% -5% -2%

-60%

-50%

-40%

-30%

-20%

-10%

0%

Turkey Russia Brazil Indonesia South Africa Philippines Malaysia India Singapore Thailand China

To summarise

Key takeaways

Why India? Multi-year, multi-asset

opportunity, under-represented in global portfolio

Why now? Greater global recognition Markets attractively poised

Why Schroders? Axis capability, strong track record and differentiated

investment process

38

Important information This presentation does not constitute an offer to anyone, or a solicitation by anyone, to subscribe for shares of Schroder International Selection Fund (the “Company”). Nothing in this presentation should be construed as advice and is therefore not a recommendation to buy or sell shares. Subscriptions for shares of the Company can only be made on the basis of its latest Key Investor Information Document and prospectus, together with the latest audited annual report (and subsequent unaudited semi-annual report, if published), copies of which can be obtained, free of charge, from Schroder Investment Management (Luxembourg) S.A. An investment in the Company entails risks, which are fully described in the prospectus. Past performance is not a reliable indicator of future results, prices of shares and the income from them may fall as well as rise and investors may not get the amount originally invested. Schroders has expressed its own views and opinions in this presentation and these may change. This presentation is issued by Schroder Investment Management Ltd, 31 Gresham Street, EC2V 7QA, who is authorised and regulated by the Financial Conduct Authority. For your security, communications may be taped or monitored. Risk Considerations – Schroder ISF Indian Opportunities The capital is not guaranteed. Investments denominated in a currency other than that of the share-class may not be hedged. The market movements between those currencies will impact the share-class. Investments in small companies can be difficult to sell quickly which may affect the value of the fund and, in extreme market conditions, its ability to meet redemption requests upon demand. The fund will not hedge its market risk in a down cycle. The value of the fund will move similarly to the markets. The fund will be subject to the respective market movements of a limited number of sectors and/or countries of the investment universe. The fund may invest in other regions than the primary universe of the Fund resulting in an additional currency and interest rate risk. Emerging markets will generally be subject to greater political, legal, counterparty and operational risk. Risk Considerations – Schroder ISF Indian Equity The capital is not guaranteed. In order to access restricted markets, the fund may invest in structured products. Should the counterparty default, the value of these structured products may be nil. Investments denominated in a currency other than that of the share-class may not be hedged. The market movements between those currencies will impact the share-class. The fund will not hedge its market risk in a down cycle. The value of the fund will move similarly to the markets. Emerging markets will generally be subject to greater political, legal, counterparty and operational risk. Emerging equity markets may be more volatile than equity markets of well established economies. Investments into foreign currencies entail exchange risks. The fund may hold indirect short exposure in anticipation of a decline of prices of these exposures or increase of interest rate. Third Party Data Disclaimer Third party data is owned or licensed by the data provider and may not be reproduced or extracted and used for any other purpose without the data provider's consent. Third party data is provided without any warranties of any kind. The data provider and issuer of the presentation shall have no liability in connection with the third party data. The Prospectus and/or www.schroders.com contains additional disclaimers which apply to the third party data. Forecasts The forecasts stated in the presentation are the result of statistical modelling, based on a number of assumptions. Forecasts are subject to a high level of uncertainty regarding future economic and market factors that may affect actual future performance. The forecasts are provided to you for information purposes as at today’s date. Our assumptions may change materially with changes in underlying assumptions that may occur, among other things, as economic and market conditions change. We assume no obligation to provide you with updates or changes to this data as assumptions, economic and market conditions, models or other matters change.

39