Comprehensive project report presentation

1. A
COMPREHENSIVE PROJECT REPORT
On
“Analysis of Various Investment Avenues with Special Reference to Mutual Fund”
On
State Bank of India
Submitted To
N.R. VEKARIA INSTITUTE OF BUSINESS MANAGEMENT STUDIES
IN PARTIAL FULFILLMENT OF THE REQUIREMENT OF THE AWARD FOR THE DEGREE OF
Master of business administration
In
GUJARAT TECHNOLOGICAL UNIVERSITY
UNDER THE GUIDENCE OF
Faculty Guide Company Guide
Prof. RAJENDRA PATOLIYA
Submitted By
(CHIRAG D. RUPARELIYA & AMIT PARMAR)
[Batch: 2015-17, Enrollment No: 157360592081 & 157360592068]
MBA SEMESTER III
N.R. VEKARIA INSTITUTE OF BUSINESS MANAGEMENT STUDIES
MBA program
Affiliated to GUJARAT TECHNOLOGICAL UNIVERSITY
AHMEDABAD

2. About the company
Asset Management Company in India having 25 years of experience
A Joint Venture of SBI and Amundi
Having Investor Base of over 4.58 million
Giving stable Investment Policies for aiding investors

3. Overview of Industry
The mutual fund industry in India began in the year 1963 along the
formation of Unit Trust of India (UTI) at the initiative of Government
of India as well as Reserve Bank of India (RBI).
Besides penetration of private sector funds in 1993, a new era began
in the Indian mutual fund industry providing Indian investors broad
preference of fund families.
At the end of 1993, mutual fund industry was having assets under
management of Rs 47,004 Cr.
SEBI mutual fund regulations 1993 were complemented by much
widespread and revised mutual fund regulations in 1996. This
industry is currently running under SEBI mutual fund regulations
1996.

4. Entities in
Mutual
Fund
Operation
Mutual
fund
Sponsor
Trustees
Asset
Manage
ment
Compani
es
Custodia
ns
Registrar
s and
Transfer
Agents

5. Overview of World Market
Main Distribution Channels for mutual funds by country
• Banks
• Security Brokers
• Sales Agents
Saudi Arabia
• Banks
• Security Brokers
• Sales Agents
China
• Banks
• Insurance CompaniesHungary

6. Overview of Indian market
Equity mutual funds added over 1100000 investor accounts or folios in the first five
months of current fiscal year mainly due to strong participation from retail
investors.
AMFI shows that mutual fund industry has been adding 2.07 LACS SIP accounts
each month on an average over some previous few years with an average SIP size
of Rs 3200 per SIP account.
The total number of accounts or folios as per mutual fund parlance as on August
31, 2016 stood at 4.97 Cr.

7. Growth of Industry/Sector
Phases Description
1st phase(1964-1987) UTI was de-linked from RBI in the year
1978 and the IDBI (Industrial
Development Bank of India) took over
regulatory and administrative control
place of RBI.
2nd Phase(1987-1993) 1987 marked the arrival of non UTI,
public sector mutual funds set up by
public sector banks, LIC and General
Insurance Corporation of India (GIC). SBI
mutual fund was first Non-UTI mutual
fund established in June 1987 followed
by CANBANK mutual fund (Dec 1987).
Third Phase (1993-2003) Several mergers as well as acquisitions
have been done till the completion of
2003. There were 33 mutual funds with
total assets of 121805 cr.

8. Major
Companies
Axis
Mutual
fund
Baroda
Pioneer
Bharti AXA
Birla
Sunlife ICICI
prudential
HDFC
Mirae
asset

9. Product Profile i.e. chief products
Prime products
Equity Schemes
Sector Funds
Thematic funds
Equity Linked Saving Scheme
Debt/Income Fund Scheme
Liquid Schemes
Hybrid Schemes
Fixed maturity plans
Exchange Traded fund schemes

10. Introduction of the Study
Literature Review
 Panday (2011) Analyzed pattern of investors’ behavior and factors which regulate
their decision of investments in mutual funds by conducting questionnaire survey
on 50 people. He knew that ignorance exists about mutual funds as an investment
option because investors were not aware about benefits they can reap through
mutual funds.
 Rangnathan (2006) Examined related aspects of mutual fund selection behavior of
individual investors towards mutual funds in Mumbai city and surveyed 100
educated investors. The study revealed that investors preferred open ended
growth schemes.
 Ramamurthy and Reddy (2005) conducted a study of scrutinizing recent trends in
Indian Mutual Fund industry. Authors concluded that major benefits delivered to
small investors by mutual funds are professional management, diversification of
risk, return potential, expedient administration, liquidity, transparency,
affordability, flexibility, wide choice and appropriate regulation.

11. Background of the study
 An estimated 76200 mutual funds worldwide currently control about $30
trillion in assets under management (AUM), representing just over 20% of
total global assets under management on behalf of investors worldwide.
Mutual funds have typically come about as an outcome of developed
financial markets, not a cause of it.

12. OBJECTIVES OF STUDY
1. Primary Objective
 To show wide range of investment options available in mutual funds by
exhibiting various schemes.
2. Secondary Objectives
 Knowing about risk factors involved in mutual funds and generation
of incredible tendency trying to tackle it.
 Comparing diverse schemes and concluding apt one to be politely
favored by general public.
 To understand recent trends in mutual fund worlds.
 Estimating mutual fund as rewarding avenue
 To impart brief insight about privileges available from mutual fund
investment.

13. HYPOTHESIS SETTING
 H0=Mutual funds are prominent as well as convenient source of
generating side income with latent money lying.
H1=Mutual funds cannot be prominent and convenient source of earning
side income with latent money lying.
 H0= Money is invested specifically to avail an advantage of tax.
H1=Money is invested for other motives.
 H0=As much as risk is concerned with specific scheme, chances are greater
to have incredible rewards.
H1=Returns from specific schemes do not equate with risk attached with
it.

14. RESEARCH METHODOLOGY
Particulars Attributes
Research Design applied Descriptive & statistical
Sources of data collection Secondary Data
Data Collection Tools Literatures, Websites, Magazines,
News papers, books, trade journals,
industrial portal

15. DATA ANALYSIS AND INTERPRETATION
Ratios Figures
Current Ratio 2.77:1
Return on assets 21%
Return on equity 26%
Gross profit Ratio 54.48%
Net profit ratio 29.93%
Proprietary ratio/Net worth ratio 0.81:1
Fixed Assets/net worth 0.65:1
Current Assets/Net worth ratio 0.59:1
Current Liability/Net worth ratio 0.21:1

16. Expected versus estimated return
Company Actual return Expected return
ICICI 21.23 13.20
Mirae 34.76 14.85
Birla sunlife 28.1 14.60
DSP blackrock 25.43 13.72

17.  From ratio analysis, it was proved that current ratio normally 2:1 is good
for any company while here, SBI mutual fund has even greater portion of
assets than its portion of current liability.
 Return on assets is also 21% which is good enough and return on equity
capital employed is 26%.
 Turning towards technical aspects, then beta of SBI MF is 0.45 which is <1
so investor would need not to think about prevalence of risk saying silently
that if market goes down, then securities are not going to be affected.

18. Results/Findings
• Systematic investment plan is similar to recurring deposit where an
investor willing to keep some amount for growth motive or for safety
intention invests regularly.
• In many emerging markets and sometimes developed markets, mutual
funds are synthetically grown through first establishing legal and
regulatory framework. Two key aspects of any investment are time as well
as risk.
• When an investor invests money in mutual funds, funds are added to pool,
funds so made are hence invested in equity market in such a way that
even if one incurs losses others shall manage to mitigate losses.

19. LIMITATION OF STUDY
 Lack of primary data analysis.
 Unable of covering all contents regarding mutual funds due to vast
horizon.
 Absence of scheme information documents.
 Uncertainty of return from funds.
 Market Volatility.

20. SUGGESTION
 Most of tax saving mutual funds are ELSS and make investment in equity
market.
 ELSS schemes tend to come with lock in period of 3 years which means
that investment cannot be withdrawn till the end of time.
 Whereas along with SBI, if a person still is having suspicion about losing
money then he is advised to make one portfolio that are ranked 1 and also
given 5 stars by CRISIL. These excellent funds are
 ICICI prudential top 100 funds-18%
 Mirae emerging bluechip fund-32%
 Birla sunlife equity fund-23%
 DSP black rock tax saver fund-27%

21. Conclusion
 Indian Mutual Funds have currently over 1.09 crore (10.9 million) SIP
accounts through which investors regularly invest in Indian Mutual Fund
schemes.
 SIP is a very convenient method of investing in mutual funds through
standing instructions to debit your bank account every month, without the
hassle of having to write out a cheque each time.

22. Bibliography
Useful Links
• Securities and Exchange Board of India
• SEBI Investor Awareness Website
• National Institute of Securities Markets
• MF Utilities India Pvt. Ltd (MFU)
• Reserve Bank of India
• NSE - National Stock Exchange of India Ltd.
• BSE - Bombay Stock Exchange of India Ltd.
• UIDAI
• Eaadhaar
• Income Tax India