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UNINOR“Analysing the alternatives of investment”                             for Uninor    In partial fulfillment for the ...
UNINOR                 TABLE OF CONTENTS   Chapter                              Description               Page            ...
UNINORChapter 4           Bonds                             76       4.1          Bonds                             77    ...
UNINOR                             ACKNOWLEDGMENTThe present work is an effort to throw some light on the ―Investment oppo...
UNINORIndustry studyWhat is Telecommunications?Telecommunications is the communication of information by electronic means ...
UNINORcall offices (PCOs) that offered local, domestic and international calling services. Two largecorporate entities wer...
UNINORAccording to the new analytical study on the sector ―Indian Telecom Analysis (2008-2012)‖, mobile telephony continue...
UNINORPrivate operators have played a very crucial role in the growth of the telecommunicationindustry, primarily in the m...
UNINORList of mobile network operators in IndiaRank Operator            Subscribers        Ownership                      ...
UNINOR                          0.45 (January Etisalat15    Cheers Mobile                          2011)         Dynamix B...
UNINORWireline Subscribers Base (in million)Service          QE       Dec QE         Mar QE       Jun QE       Sep QE     ...
UNINORSubscribers (Rural & Urban) and Market shareService        Subscriber         MarketProvider       base(millions)   ...
UNINOR                                 COMPANY PROFILEUninor: Ab Mera Number HaiIntroductionUnitech Wireless (Tamilnadu) P...
UNINOR      Subscriber Base details of Uninor: (in million)Period           31-Dec-                   30-Jun-             ...
UNINORKey ManagementBrief profiles of the key executives are given in the table below: Name                           Posi...
UNINORTelenor Group provides tele, data and media services in the Nordics, Central and EasternEurope and Asia. At present,...
UNINORInvestment portfolio of uninor      Public Banks      State Bank of India (SBI)      Punjab National Bank (PNB)     ...
UNINOR Climate Strategy for 2011, we hope to launch many new initiatives that will reaffirm our intent. This is just the b...
UNINOR Uninor’s Bihar and Jharkhand circle, in eastern India, has established an outbound call centre to promote and upsel...
UNINORChapter 1            INTRODUCTION 20
UNINOR1.1 INTRODUCTION TO INVESTMENTInvestment is the commitment of money or capital to purchase financial instruments or ...
UNINOR1.3 FACTORS WHICH INFLUENCE THE DECICION TO INVESTRisk appetite: - The ability to tolerate risk differs from person ...
UNINOR1.4 TYPES OF INVESTMENTSThere are various investment types along the risk-return spectrum.Financial InstrumentsEquit...
UNINORCash equivalents/ Money market instrumentsThese are relatively safe and highly liquid investment options. Treasury b...
UNINOR     CHAPTER 2            MUTUAL FUNDS25
UNINOR2.1 Mutual fundsA mutual fund is just the connecting bridge or a financial intermediary that allows a group ofinvest...
UNINOR2.2 Working of Mutual FundThe idea behind a MF is that investors lack time, inclination or skills to manage their ow...
UNINORSource: Association of mutual Fund India2.3 Regulatory AuthorityTo protect the interest of the investors, SEBI formu...
UNINOR2.4 Advantages of mutual funds for investors     Professional Management: Mutual funds offer investors the opportuni...
UNINOR Tax benefits: Certain schemes of mutual funds provide the investors the benefits of deduction of the amount investe...
UNINOR2.5 Limitations of mutual funds       Lack of portfolio customization: Mutual funds offer Portfolio Management      ...
UNINOR   Growth Schemes:        These schemes tend to provide optimal returns through capital   appreciation. These scheme...
UNINORSchemes. These have a low cost of operation unlike the actively managed schemesbecause here the portfolio is determi...
UNINOR      Gilt Funds: These schemes invest only in the treasury bills and government       securities. These instrument...
UNINOR      Capital Protected Scheme: These are close-ended schemes and they ensure that       whatever the market condit...
UNINOR   Fund of Funds: Funds that are structured to invest in various other funds are said to be   the Fund of Funds. The...
UNINOR         If fund holdings increase in price but are not sold by the fund manager, the funds         shares increase ...
UNINORrelating the returns on a mutual fund with the returns in the market. While unsystematic riskcan be diversified thro...
UNINORSharpeIn this model, performance of a fund is evaluated on the basis of Sharpe Ratio, which is aratio of returns gen...
UNINORNow for all the categories top 5 schemes from last 5 years:Liquid funds RANK            SCHEMES                NAV(R...
UNINORSahara Liquid Fund 0.75         2.28       4.25           7.27        7.12             7.25- Fixed PricingOption - G...
UNINORInterpretationAs beta of Escorts Liquid Plan - Growth and ICICI Prudential Liquid - Super InstitutionalPlan - Growth...
UNINORScheme performance % as on May, 2011/ returnMonths/year            1month     3month     6month      1year       3ye...
UNINORRisk schemes                 mean        Standard Sharpe          beta        trey nor                              ...
UNINORDebt fundsRANK           SCHEMES                NAV(Rs)     LAST      5 SINCE                                       ...
UNINORPlan - GrowthGraph  30  25  20                                                escorts Income Bond                   ...
UNINORInterpretationEscorts Income Bond - Growth and Canara Robeco Monthly Income Plan - Growth has alow beta hence lower ...
UNINORScheme performance % as on May, 2011/ returnMonths/year            1month        3month    6month      1year        ...
UNINORRisk schemes                mean        Standard sharpe         beta        treynor                                 ...
UNINOR                   Franklin    Pharma 62.66             14.97                16.355                  Fund - GrowthSc...
UNINORRisk schemes                mean       Standard sharpe          beta       treynor                                  ...
UNINOR5              Term Equity Fund -               GrowthScheme performance % as on May, 2011/ return Months/year   1mo...
UNINOR   20   15                                                    IDFC Premier Equity Fund -                            ...
UNINORBalancedRANK           SCHEMES              NAV(Rs)    LAST      5 SINCE                                            ...
UNINORBirla Sun Life 95 - -2.73       5.28           -7.14      9.31         12.62            12.88GrowthHDFC      Balance...
UNINOR Growth HDFC       Balanced -0.26           3.68           -0.10          0.91          -0.40 Fund - Growth DSP     ...
UNINORShort Term IncomePlan - InstitutionalPlan - GrowthTempleton      India 0.65           2.30      3.32              5....
UNINOR Templeton       India 0.20         0.22        0.44         0.73        0.13 Short Term Income Plan - Growth ICICI ...
UNINOR     Chapter 3      GOVERNMENT SECURITIES59
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  1. 1. UNINOR“Analysing the alternatives of investment” for Uninor In partial fulfillment for the Award of Master of Business Administration To IILM INSTITUTE OF HIGHER EDUCATION And UNINORSubmitted by : 1
  2. 2. UNINOR TABLE OF CONTENTS Chapter Description Page Acknowledgement 4 Industry study 5-12 Uninor profile 13-19Chapter 1 Introduction 20 1.1 Introduction to Investment 21 1.2 What is investment? 21 1.3 Factor which influence the decision to invest 22 1.4 Types of investment 23-24Chapter 2 Mutual fund 25 2.1 Mutual funds 26 2.2 Working of mutual fund 27 2.3 Regulatory authority 28 2.4 Advantages of mutual fund 29-30 2.5 Limitations 31 2.6 Types of funds 31-36 2.7 Types of returns 36-37 2.8 Performance measures of mutual funds 37-39 2.9 Analysis of different mutual fund schemes 39-58Chapter 3 Government securities 59 3.1 Government securities 60 3.2 Features of government securities 60-61 3.3 Benefits 62 3.4 Important considerations 62-63 3.5 Types of government securities 63 3.5.1 Treasury bills 63-65 3.5.2 Dated securities 66-68 3.5.3 State development loans 69-70 3.6 List of government securities outstanding 71-75 2
  3. 3. UNINORChapter 4 Bonds 76 4.1 Bonds 77 4.2 Assessing risk for bonds 77-80 4.3 Types of bonds 80 4.3.1 Corporate bond 80-81 4.3.2 Government bond 82 4.3.3 Municipal bonds 82-83 4.3.4 Public sector undertaking bonds 83Chapter 5 Money market 84 5.1 Money market 85 5.2 Benefits and functions 85 5.3 Money market instruments 85 5.3.1 Certificate of deposit 85-87 5.3.2 Commercial paper 87-88 5.3.3 Treasury bills 88-89 5.3.4 Inter corporate deposit 89 Conclusion 90-93 3
  4. 4. UNINOR ACKNOWLEDGMENTThe present work is an effort to throw some light on the ―Investment opportunities‖ foruninor.I have taken efforts in this project. However, it would not have been possible without the kindsupport and help of many individuals and organizations. I would like to extend my sincerethanks to all of them.My deep sense of gratitude to Mr. Neerav Jain, for giving me the opportunity to work on thisproject.I would like to express my sincere gratitude to Mr Amar T.G, Mr Sanjay Pant, Mr MahendraDwivedi and Mr Sunil Aggarwal. I was privileged to experience a sustained enthusiastic andinvolved interest from their side.I would also like thank my college faculty Mrs. Vandana Mehrotra and my mentor Mr. VinayChirania. The supervision and support that they gave truly help the progression andsmoothness of the internship program. The co-operation is much indeed appreciated.My thanks and appreciations also go to my colleague in developing the project and peoplewho have willingly helped me out with their abilities.I also extend my heartfelt thanks to my family and well wishers. 4
  5. 5. UNINORIndustry studyWhat is Telecommunications?Telecommunications is the communication of information by electronic means usually oversome distance.Telecommunication is the transmission and reception of messages over long distances. Visualsignaling with flags, lamps or smoke was the earliest form of telecommunication. Today, theterm refers to a wide variety of electrical and electronic communication systems usedthroughout the world. Modern telecommunication systems send and receive sound, printedmaterials, and visual images in a fraction of a second.Most telecommunication systems transmit messages by wire, radio or satellite. Manytelegraph messages and telephone conversations, as especially local calls, travel over wiresthat are laid underground in cables. Cables on the sea floor handle such communications thattravel overseas. Television and radio broadcast are sent through the air by radio waves. Radiowaves called microwaves transmit television signals over extremely long distances.Microwaves are also used in most long distance telephone communication.BackgroundIndian telecommunications sector has undergone a major process of transformation throughsignificant policy reforms, particularly beginning with the announcement of NTP 1994.Historically, the process of expansion of the network was rather slow, being owned andmanaged by the Government under the assumption that telecommunications was a naturalmonopoly best run as a state-owned monopoly. By the early 1990s, this concept of a naturalmonopoly was increasingly challenged in many countries by technological changes,especially in the wireless field and by laudable success in several countries in lowering thecost of services for common man. Policy makers in our country began process of reforms inthe 1990s that led to gradual ushering in competition for greater consumer welfare,particularly in terms of lowering of tariffs and improvement in quality of service.First Phase - The EightiesTelecom reforms in India began in the 1980s with the launch of a ―Mission BetterCommunication‖ program. Private manufacturing of customer premise equipment wasallowed in 1984 and the Center for Development of Telematics (C-DOT) was established forthe development of indigenous technologies. Private franchises were freely given for public 5
  6. 6. UNINORcall offices (PCOs) that offered local, domestic and international calling services. Two largecorporate entities were spun off from the Department of Telecommunications, e.g.Mahanagar Telephone Nigam Limited (MTNL) for Delhi and Mumbai and Videsh SancharNigam Limited (VSNL) for all international services. Significantly, this began the process ofcorporatisation of services that had hitherto been under a government department. A high-powered Telecom Commission to direct telecommunications policies was set up in 1989 withfull powers of the Government.Second Phase - The Early NinetiesThe second phase of reform commenced with the general liberalisation of the economy in theearly 1990s and announcement of a New Economic Policy (NEP)-1991. Telecom equipmentmanufacturing was delicensed in 1991 and value-added services were declared open to theprivate sector in 1992, following which radio paging, cellular mobile and other value addedservices were opened gradually to the private sector. National Telecom Policy wasannounced in 1994, with a major thrust on universal service and qualitative improvement intelecom services and also, opening of private sector participation in basic telephone services.An independent statutory regulator was 6 established in 1997. Progressively there was growthin private sector provision of telecom services in the country.Third Phase - The late NinetiesThe most important landmark in telecom reforms, however, came with the New TelecomPolicy 1999 (NTP-99) which can be termed as the new, or third, generation of reforms. Itsfirst qualitative difference was the acceptance by the government that telecommunicationswas a sufficiently important for common man whereas earlier it had been viewed as a ―cashcow‖. For example, the private sector had earlier been asked to bid for licenses to providetelecom services through a sealed bid auction in which the bidder paid a fixed fee. Thisproved unaffordable to the private sector owing to unrealistic calculations of the revenuepotential of a license, resulting in a near zero rollout of lines. Rather than insisting on theprior fulfillment of its revenue obligations, NTP-99 allowed private providers to ―migrate‖from fixed license fee regime to a revenue sharing regime. The second qualitative differencewas that the regulator was strengthened, domestic long distance services were opened to theprivate sector, and the state-owned basic service provider under the Department ofTelecommunications was corporatized.Current scenario of the Indian Telecom Industry:Telecom industry in India has undergone a revolution during the past few years withtremendous growth in the telecom subscriber base. Additionally, the country’s telecomindustry is one of the fastest growing and one of the largest telecommunication networks inthe world. With the ongoing investments into infrastructure deployment, the country isprojected to witness high penetration of Internet, broadband, and mobile subscribers in nearfuture. 6
  7. 7. UNINORAccording to the new analytical study on the sector ―Indian Telecom Analysis (2008-2012)‖, mobile telephony continues to fuel growth in the Indian telecom sector with mobilesubscriber base projected to grow at a CAGR of around 6.6% during 2011-12 - 2014-15.Other segments of the industry, like Internet are also anticipated to witness strong growth interms of both subscriber addition and network infrastructure deployment during the forecastperiod. Moreover, with the launch of 3G services, the country is expected to witness rapidsurge in the broadband subscribers’ base during the coming years.Tele-density in India has significantly improved during the past few years and has coveredlarge portion of the country’s population owing to the improving network infrastructure.Further, launch of advanced telecom services, such as 3G and IPTV will also drive growthin the Indian telecom subscriber base during the forecast period. Moreover, mobile handsetmarket is expected to register robust growth in near future.Currently, both public sector players as well as the private sector players are activelycatering to the rapidly growing telecommunication needs in India. Private participation ispermitted in all segments of the telecom industry, including ILD, DLD, basic cellular,internet, radio paging, et al. The broad structure of the telecom industry (in terms of serviceproviders) is depicted in the diagram below:Public Sector:After the privatisation of VSNL in 2002, only two premier PSUs, MTNL and BSNL operatein India and provide various telecom services. As noted earlier, MTNL operates in Delhi andMumbai and BSNL provides services to the remaining country. In the post-liberalisation era,these PSUs not only have made significant progress but also have provided stiff competitionto their private counterparts.Private Sector: 7
  8. 8. UNINORPrivate operators have played a very crucial role in the growth of the telecommunicationindustry, primarily in the mobile services. With the liberalisation of the telecom industry, theprivate sector has been increasing its foothold in the telecom services space. After theintroduction of NTP-99, the contribution of private players towards telecom services haswitnessed rapid strides. While the private sector is instrumental in providing both fixed lineas well as wireless services, it is mainly active in the wireless segment. The fixed linesaccount for only about 2% of private sectors total subscriber base. While some privateplayers have a pan-India presence, there are many regional players that cater to only certainservice areas.Telecom industry subscriber 2011 growth rateThe range of largest subscriber including the metropolitan cities according to the recent datacounting of 2011 shows the rate of growing subscribers in the telecom industries. Subscriber Population Mobile Phones per ThousandState Base (01/03/2011) populationUttar Pradesh 106,192,054 199,581,477 532Maharashtra 94841692 112,372,972 844Tamil Nadu 68,168,580 72,138,958 945Andhra 59,364,339 84,665,53 701PradeshWest Bengal 60,928,561 91,347,736 667Bihar 52,100,177 103,804,637 502Karnataka 48,465,542 61,130,704 793Gujarat 45,881,267 60,383,628 760Rajasthan 42,380,958 68,621,012 618Madhya 44,256,394 72,597,565 610PradeshDelhi 16,753,235 37,539,635 2,241Kerala 30,954,858 33,387,677 927Punjab 27,817,459 27,704,236 1,004India 791,381,574 1,210,193,422 654 8
  9. 9. UNINORList of mobile network operators in IndiaRank Operator Subscribers Ownership Bharti Enterprises (64.76%) 155.75 Singapore1 Airtel (January 2011) Telecommunications (32%) Vodafone (4.4%) 127.36 Vodafone (67%) & Essar2 Vodafone (January 2011) Group (33%) Reliance 128.87 Reliance (67%) & Public3 Communication (January 2011) (26%) Aditya Birla Group 84.28 (January4 Idea Axiata Group Berhad 2011) (19.1%) 83.59 (January5 BSNL State-Owned 2011) Tata DoCoMo Tata Indicom Virgin Mobile 86.05 (January6 Tata-Teleservices (CDMA) 2011) Virgin Mobile (GSM) Maxis Communications 51.83 (January7 Aircel (74%) 2011) Apollo Hospital (26%) Unitech Wireless 20.3 (January8 Uninor Telenor (67.25%) 2011) Unitech Group (32.75%) 6.01 (January9 Videocon Videocon 2011) 5.15 (January10 MTNL State-owned 2011) Essar Group (8.0%) 3.06(January11 Loop Mobile Santa Trading Pvt Ltd 2011) (85.75%) 9.09 (January Sistema (73.71%) & Shyam12 MTS 2011) Group (23.79%) 2.51 (January Siva Group (51%)13 S Tel 2011) Batelco (49%) 1.28 (January14 Ping Mobile HFCL Infotel Limited 2011) 9
  10. 10. UNINOR 0.45 (January Etisalat15 Cheers Mobile 2011) Dynamix Balwas GroupThe number of telephone subscribers in India increased from 723.28 million in Sep-10 to787.28 million at the end of Dec-10, registering a sequential growth of 8.85% over theprevious quarter as against 7.68% during the QE Sep-10. This reflects year-on-year (Y-O-Y)growth of 40.05% over the same quarter of last year. The overall Teledensity in India hasreached 66.16 as on 31st December 2010.Telecom Financial Data (for the QE Dec-10)Gross Revenue during the quarter ` 42,916.81 Crore % change in GR over the previousquarter 2.44% Share of Public sector undertakings in GR 15.90% Adjusted Gross Revenue(AGR) ` 29,925.37 Crores % change in AGR over the previous quarter 0.64% ARPU forAccess Services ` 107Subscription in Urban Areas grew from 487.07 million in Sep-10 to 527.50 million at the endof Dec-10, taking the Urban Teledensity from 137.25 to 147.88. Rural subscription increasedfrom 236.21 million to 259.78 million, and the Rural Teledensity increased from 28.42 to31.18. The share of Rural subscribers has increased to 33.00% in total subscription from32.66% in Sep-10. Wireline subscriber base further declined from 35.57 million at theend of Sep-10 to 35.09 million at the end of Dec-10, bringing down the wireline Teledensityfrom 3.00 in Sep-10 to 2.95 at the end of Dec-10.Average Revenue Per User (ARPU) for GSM service declined by 4.38%, from `110 in QESep-10 to `105 in QE Dec-10, with Y-O-Y decrease of 27%. Gross Revenue (GR) andAdjusted Gross Revenue (AGR) of Telecom Sector for the QE Dec-10 has been `42,916.81Crore and `29,925.37 Crore respectively. There has been an increase of 2.44% and 0.64% inGR and AGR respectively as compared to previous quarter. The year-on-year (Y-O-Y)growth for Dec-10 over the same quarter in last year has been 7.95% and 2.75%. Passthroughcharges accounted for 30.27% of the GR for the quarter ending Dec-10. The quarterly and theyear-on-year (Y-O-Y) growth rates of pass-through charges for QE Dec-10 are 6.84% and22.20% respectively. 10
  11. 11. UNINORWireline Subscribers Base (in million)Service QE Dec QE Mar QE Jun QE Sep QE DecProvider 2009 2010 2010 2010 2010BSNL 28.10 27.83 26.94 26.22 25.65MTNL 3.49 3.50 3.49 3.47 3.47Bharti 2.99 3.07 3.15 3.22 3.26Tata 1.10 1.16 1.20 1.23 1.27Reliance 1.16 1.18 1.19 1.21 1.22Quadrant 0.17 0.17 0.18 0.18 0.19(HFCL)Sistema 0.05 0.05 0.04 0.04 0.04Wireless Subscriber Base (in million)Service QE Dec QE Mar QE Jun QE Sep QE DecProvider 2009 2010 2010 2010 2010Bharti 118.86 127.62 136.62 143.29 152.50Reliance 93.80 102.42 110.81 117.34 125.65Vodofone 91.40 100.86 109.06 115.55 124.26BSNL 62.86 69.45 72.70 78.32 86.71Tata 57.33 65.94 72.53 79.07 84.23Idea/Spice 57.61 63.82 68.89 74.21 81.78Aircel/Dishnet 31.02 36.86 41.68 46.52 50.17Unitech 1.21 4.26 6.02 11.27 18.51Sistema 2.99 3.78 5.10 6.64 8.43Videocon - 0.03 1.942 4.48 7.32MTNL 4.88 5.09 5.21 5.31 5.40Loop 2.65 2.84 2.93 2.98 3.04S Tel 0.14 1.01 1.33 1.64 2.32Quadrant 0.34 0.33 0.67 1.02 1.61Etisalat - 0.00 0.0182 0.057 0.26 11
  12. 12. UNINORSubscribers (Rural & Urban) and Market shareService Subscriber MarketProvider base(millions) Share in dec 2010 Dec-10Bharti 155.75 19.78%Reliance 126.87 16.12%Vodafone 124.26 15.78%BSNL 112.36 14.27%Tata 85.50 10.86%IDEA/Spice 81.78 10.39%Aircel/Dishnet 50.17 6.37%Unitech 18.51 2.35%MTNL 8.86 1.13%Sistema 8.47 1.13%Videocon 7.32 0.93%Loop Mobile 3.04 0.39%S Tel 2.32 0.29%Quadrant 1.80 0.23%Etisalat 0.26 0.03%Bharti is the leading operator in Access segment in terms of number of subscribers as well asnet additions during the quarter. In terms of growth rate, relatively new market entrants haveattained higher rates, which can be mainly attributed to the low base effect.Access Services – Service Provider wise Gross Revenue (` in Crore)Service QE Sep-10 QE Dec-10 % ChangeAircel 1395.06 1438.00 3.08Bharti 9164.86 9507.77 3.74BSNL 4520.52 4294.59 -5.00Etisalat 0.57 2.18 283.80Quadrant 39.40 44.27 12.35Idea 3717.27 4055.59 9.10Loop 167.26 179.81 7.51MTNL 865.59 786.24 -9.17Reliance 3253.67 3155.71 -3.01S Tel 17.82 26.90 50.96Sistema Shyam 149.60 195.57 30.73Tata 2402.36 2559.48 6.54Unitech 148.08 301.14 103.36Videocon - 99.86 -Vodafone 6161.09 6462.84 4.90Grand Total 32003.14 33109.95 3.46 12
  13. 13. UNINOR COMPANY PROFILEUninor: Ab Mera Number HaiIntroductionUnitech Wireless (Tamilnadu) Pvt Ltd, (hereinafter referred to as ―Uninor‖ or the―Company‖) is a joint venture between Telenor ASA, Norway and Unitech Group. Uninorwas incorporated on August 2007 for the purpose of venturing into the telecom servicesindustry. The company obtained UAS (Unified Access Services) licenses in January 2008from Department of Telecom (DoT), Government of India (GoI), for providing telecomservices in all the 22 circles in India. Uninor has since been allocated start-up spectrum in 21out of the 22 circles of the country with spectrum for the Delhi circle expected to be allocatedin near future.Services have been rolled out in the following 13 circles: 8 Circles commercially launched in Andhra Pradesh , Karnataka, Tamil Nadu, Dec’2009 Kerala, UP (E), UP (W), Bihar and Orissa 5 Circles commercially launched in Mumbai, Kolkata, Gujarat, Maharashtra and June’2010 West BengalTelenor has since inducted Rs.6,135 Crore towards fresh equity in Uninor making it themajority shareholder (67.25% stake). 13
  14. 14. UNINOR Subscriber Base details of Uninor: (in million)Period 31-Dec- 30-Jun- 31-Dec-ending 09 31-Mar-10 10 30-Sep-10 10 31-Mar-11 30-Apr-11OpeningSub Base - 1.21 4.26 6.02 11.27 18.51 22.79(nos)Additions 1.21 3.06 1.76 5.24 7.24 4.28 1.45ClosingSub Base 1.21 4.26 6.02 11.27 18.51 22.79 24.24(nos) Board of Directors The list of Board of Directors of Uninor is as under:- S.No. Name 1 Mr. Sanjay Chandra 2 Mr. Sigve Brekke 3 Mr. Richard Olav Aa 4 Mr. Nirjhar Goel Mr. Jan Edvard 5 Thygesen 6 Mr. Jayesh Desai 7 Mr. Yogesh Malik 14
  15. 15. UNINORKey ManagementBrief profiles of the key executives are given in the table below: Name Position held Mr. Sigve Brekke Managing Director Mr. Yogesh Malik Executive Vice-President, Operations Mr. Vivek Sood Executive Vice-President, Finance Ms. Elisabeth Stene Executive Vice-President, P&O (People & Organisation) Mr. Rajiv Bawa Executive Vice-President, Corporate AffairsTelenor Group ProfileTelenor originally came into existence in the year 1853 as the Norwegian TelegraphAdministration. In the course of over 150 years of its existence, the entity progressivelyunderwent transformations including its conversion into a public corporation in the year 1994and to acquiring its present name, Telenor, in the year 1995.Headquartered in Oslo, Norway, Telenor is presently one of the top ten telecommunicationsservices provider in the World in terms of number of subscribers. Ministry of Trade andIndustry, Government of Norway owns 54% stake in the flagship company of the group,Telenor ASA.Revenues of the Telenor Group for the 12 months period ending December 2010 wereapproximately NOK 94.84 billion (i.e. Rs. 78,622 Crore; 1 NOK = 8.29 INR) , with netprofit of NOK 14.80 billion (i.e. ~ Rs. 12,269 crore) while Net Worth as on December 312010 amounted to NOK 96.21 Bn (i.e., ~Rs 79,758 Crore) 15
  16. 16. UNINORTelenor Group provides tele, data and media services in the Nordics, Central and EasternEurope and Asia. At present, its business interests include Telecom services (both fixed andwireless), Broadband services, Satellite services, Cable TV and other Voice and Dataservices. Among the various service areas, telecom forms over 85% of Telenor’s totalrevenues. Telenor is one of the top performers on Dow Jones Sustainability Indexes and oneamong the top 500 global companies by market value.Global PresenceTelenor’s operations are divided into three geographic areas: The Nordic countries, CentralEastern Europe and Asia. Of all the countries in these regions, Telenor’s businesses in Nordiccountries and Russia offer both mobile and fixed telecommunication services, while the otherbusinesses offer mobile telecommunication services. In the countries of its operations,Telenor has a strong footprint in Central Eastern Europe and Asia and a leading Nordicposition in mobile, broadband and TV services.Unitech Limited Group ProfileThe Indian co-sponsor of Uninor, Unitech Group is one of the real estate majors in India withits activities spread across the Residential, Commercial and Retail sectors. It is also engagedin activities such as Construction, Infrastructure Development, Hospitality, Development ofEntertainment Space, Manufacturing of Electrical Transmission Towers, etc. Besides, theGroup has business interests in Special Economic Zone (SEZ) development and Telecom.The core business viz., real estate development contributes over 80% of the total revenues ofthe Unitech Group. Unitech Limited is the flagship company of the Group.Corporate office: Unitech Wireless (Tamil Nadu) Pvt. LtdGround Floor, Masterpiece,Sector 54, DLF Golf Course Road, (opp Hotel Ibis), Gurgaon 122002, Haryana, India 16
  17. 17. UNINORInvestment portfolio of uninor Public Banks State Bank of India (SBI) Punjab National Bank (PNB) Bank of India (BOI) Canara Bank Vijaya Bank Central Bank of India (COI) Private Banks Housing development finance corporation (HDFC) Foreign Banks Deutsche Bank Standard CharteredSome CSR activities and initiatives by uninor Uninor wins the prestigious Green Globe Award for its “Green Initiative Opex Model” Best Contribution from the private sector Uninor was awarded the prestigious Green Globe Foundation Award 2011 at the TERI organized Delhi Sustainable Development Summit 2011 for Best Contribution by a Corporate/Business Enterprise – Private Sector. The category honours initiatives by private companies which have had a direct positive impact on the environment and/or conservation of natural resources. Green Initiative Opex Model Uninor’s entry was an assessment report of one of its pilot projects, the Green Initiative Opex Model. The model includes green initiatives like implementation of free cooling units, fuel catalysts and solar power equipment at Uninor tower sites. Due to unreliable power supply to many telecom towers in India, a majority of towers are today heavily dependent on diesel generators for uninterrupted service. Uninor’s pilot project showed not only a reduction in carbon footprint, but also savings of up to 30% on the operating cost.Uninor plans to implement 8 000 free cooling units, 10 000 fuel catalysts and 200 solar powered base transceiver stations (BTS) across India. ―Uninor is committed to responsible and sustainable business practices. Environment and climate will be important considerations in our business decisions. Under the new 17
  18. 18. UNINOR Climate Strategy for 2011, we hope to launch many new initiatives that will reaffirm our intent. This is just the beginning,‖ said Rajiv Bawa, EVP, Corporate Affairs, Uninor; while receiving the award. Part of a comprehensive Environment and Climate Strategy Uninor has developed an Environment and Climate Strategy, building on the ambitions of the Telenor Group. The objective is to make sure that sustainability is an inherent part of how the company doesbusiness.The strategy has three focus areas that are central in achieving Uninor’s long term ambitions as a sustainable business: operational efficiency, responsible business practice and accountability. Good for the environment and good for business Operational efficiency is more than a CR effort. Reducing fuel consumption, streamlining operations and ensuring that environmental properties are given weight in procurement and sourcing activities has been a key focus for Uninor’s Operations function.―Our operations already have a significant impact on the environment, and on our operational costs. Being a lean and low-cost operation, we are working closely with our partners to find environmentally and economically sound solutions that reduce our impact to the greatest extent possible. This award is a great encouragement,‖ says Yogesh Malik, EVP Operations in Uninor. Uninor works with GSMA to bridge mobile gender gap in India New campaign launched to educate women on how mobile phones can improve quality of life In November 2010, a village in Uttar Pradesh banned unmarried women from using mobile phones. Here, and elsewhere in this region, mobile phones are seen as unwelcome tools that enable women to step beyond the confines of traditional roles and social mores. Mobile penetration among women in many developing markets is consistently low, with just 28% of Indian women in possession of a mobile phone. In an effort to bridge the mobile gender gap in India, Uninor joined forces with the GSM Association’s mWomen advocacy campaign. Together they launched ―Mera Mobile, Mera Saathi‖, which means ―My Mobile, My Companion‖. This campaign aims to bring the life-transforming benefits of mobile phones to more women across all of India. Uninor’s call centre creates new opportunities for women In collaboration with a local ngo, uninor’s bihar and jharkand circles set up an outbound call center that creates sustainable job oppourtunities for young women from patna slums. Now the concept may expand to other circles.18
  19. 19. UNINOR Uninor’s Bihar and Jharkhand circle, in eastern India, has established an outbound call centre to promote and upsell products and services. Through cooperation with a local NGO, Gram Prodyogik Vikas Sansthan (GPVS), Uninor transformed this new call centre into a new way of life for the women of the Patna slums. GPVS currently runs an AIDS awareness programme, giving them the necessary experience and contacts needed to set up an outbound call centre. Through close partnership, Uninor and GPVS developed a business model for the call centre that would provide opportunities for women through communication, while simultaneously solving a business challenge in the Bihar and Jharkhand circle. Uninor’s new call centre business model is strongly aligned with the Telenor Group CR strategy, which is based on the concept of creating shared value for both the Group and for society. Through these innovative concepts, the Telenor Group can enable opportunities for communities and make a sustainable and positive impact in people’s lives. Life skills and business skills for women A group of 20 women were chosen through references from the local slums of Patna. For the first few days, they were taught about basic health, hygiene and grooming. After that they underwent rigorous training on soft skills and then graduated to communications, computer applications and product knowledge. The women were put on a three-day mock call session where they engaged in outbound calling to Uninor customers. The training has not stopped there. On a regular basis, forums are initiated to discuss the social and personal issues faced by the women. The initiative also features social awareness programs and provides personal counselling to the women. Uninor and hand in hand joined forces Working together to bring the internet to more people of India Uninor has teamed up with Hand in Hand to reduce the digital divide in India. Hand in Hand is a public charitable trust founded in India in 2002; its purpose is to work to eliminate poverty. Part of its mission is to support India’s Right to Information Act that promises IT and Web access to rural and semi-urban parts of the country. The first step in the Uninor – Hand in Hand partnership is to set up Citizen Centres. These centres will bring Internet access to people in rural areas, addressing the communications needs of people who have previously been unconnected. Each centre will be equipped with a computer, Internet connection and a small library with newspapers. Residents of rural areas can visit their local centres and register to vote, apply for a passport, sign petitions and access a wealth of information on the Web.19
  20. 20. UNINORChapter 1 INTRODUCTION 20
  21. 21. UNINOR1.1 INTRODUCTION TO INVESTMENTInvestment is the commitment of money or capital to purchase financial instruments or otherassets in order to gain profitable returns in the form of interest, income, or appreciation of thevalue of the instrument. Investment is related to saving or deferring consumption.It helps you meet your longer term needs and larger financial goals. There is some level ofrisk attached to all types of investments and this is what determines the returns on yourinvestments. The higher the risk, the greater the chances of a higher return.Investment may be defined as an activity that commits funds in any financial form in thepresent with an expectation of receiving additional return in the future. The expectationsbring with it a probability that the quantum of return may vary from a minimum to amaximum. This possibility of variation in the actual return is known as investment risk. Thusevery investment involves a risk and return.Investment is an activity that is undertaken by those who have savings. Savings can bedefined s the excess of income over expenditure. An investor earns/ expects to earn additionalmonetary value from the mode of investment that could be in the form of financial assets.1.2 WHAT IS INVESTMENT?Plain and simple investing money is the proactive use of your money to make more. Evenmore basic, investing can be defined as: putting your money to work for you. It is an act ofcommitting money or capital to an endeavor with the expectation of obtaining an additionalincome or profit. Investing is the proactive use of your money to make more money or, to sayit another way, it is your money working for you.Investing is different from saving. Saving is a passive activity, even though it uses the sameprinciple of compounding. Saving is more focused on safety of principal (the amount youstart out with) and less concerned with return. The idea behind investing is that money is putto use in such a way that it is likely to turn into more money. It is important to note thatbecause money can be invested, the value of a given amount of money changes over time.The longer that a given amount of money is under your control, the longer you have to investit and make more money from it. For this reason, it is almost always preferable to havemoney sooner rather than later. The name given to this concept is the "time value of money";that is, the idea that a rupee now is worth more than a rupee in the future, because a rupeenow can accrue value through interest or other appreciation until the time at which the rupeein the future would be received. 21
  22. 22. UNINOR1.3 FACTORS WHICH INFLUENCE THE DECICION TO INVESTRisk appetite: - The ability to tolerate risk differs from person to person. It depends onfactors such as your financial responsibilities, your environment, your basic personality, etc.Therefore, understanding your capacity to take on risk becomes a crucial factor in investmentdecision making.Investment horizon: - How long can you keep the money invested? The longer the time-horizon, the greater are the returns that you should expect. Further, the risk element reduceswith time.Investible surplus: - How much money are you able to keep aside for investments? Theinvestible surplus plays a vital role in selecting from various asset classes as the minimuminvestment amounts differ and so do the risks and returns.Investment need: -How much money do you need at the time of maturity? This helps youdetermine the amount of money you need to invest every month or year to reach the magicfigure.Expected returns: -The expected rate of returns is a crucial factor as it will guide yourchoice of investment. Based on your expectations, you can decide whether you want to investheavily into equities or debt or balance your portfolio. 22
  23. 23. UNINOR1.4 TYPES OF INVESTMENTSThere are various investment types along the risk-return spectrum.Financial InstrumentsEquitiesEquities are a type of security that represents the ownership in a company. Equities are traded(bought and sold) in stock markets. Alternatively, they can be purchased via the Initial PublicOffering (IPO) route, i.e. directly from the company. Investing in equities is a good long-terminvestment option as the returns on equities over a long time horizon are generally higherthan most other investment avenues. However, along with the possibility of greater returnscomes greater risk.Mutual fundsA mutual fund allows a group of people to pool their money together and have itprofessionally managed, in keeping with a predetermined investment objective. Thisinvestment avenue is popular because of its cost-efficiency, risk-diversification, professionalmanagement and sound regulation. You can invest as little as Rs. 1,000 per month in amutual fund. There are various general and thematic mutual funds to choose from and the riskand return possibilities vary accordingly.BondsBonds are fixed income instruments which are issued for the purpose of raising capital. Bothprivate entities, such as companies, financial institutions, and the central or state governmentand other government institutions use this instrument as a means of garnering funds. Bondsissued by the Government carry the lowest level of risk but could deliver fair returns.DepositsInvesting in bank or post-office deposits is a very common way of securing surplus funds.These instruments are at the low end of the risk-return spectrum. 23
  24. 24. UNINORCash equivalents/ Money market instrumentsThese are relatively safe and highly liquid investment options. Treasury bills and moneymarket funds are cash equivalents.Government securitiesGovernment security means a security created and issued by the Government for the purposeof raising a public loan or any other purpose as notified by the Government in the OfficialGazette. Government securities offer the benefit of safety, liquidity and attractive returns fora long duration to the investors.Non-financial InstrumentsReal estateWith the ever-increasing cost of land, real estate has come up as a profitable investmentproposition.CommoditiesThe items that are traded on the commodities market are agricultural, metals, energy andindustrial commodities. These items need to be standardized and must be in basic, raw andunprocessed state. The trading of commodities is associated with high risk and high reward.Trading in commodity futures require specialized knowledge and in-depth analysis. 24
  25. 25. UNINOR CHAPTER 2 MUTUAL FUNDS25
  26. 26. UNINOR2.1 Mutual fundsA mutual fund is just the connecting bridge or a financial intermediary that allows a group ofinvestors to pool their money together with a predetermined investment objective. Themutual fund will have a fund manager who is responsible for investing the gathered moneyinto specific securities (stocks or bonds). When you invest in a mutual fund, you are buyingunits or portions of the mutual fund and thus on investing becomes a shareholder or unitholder of the fund.Mutual funds are considered as one of the best available investments as compare to othersthey are very cost efficient and also easy to invest in, thus by pooling money together in amutual fund, investors can purchase stocks or bonds with much lower trading costs than ifthey tried to do it on their own. But the biggest advantage to mutual funds is diversification,by minimizing risk & maximizing returns. 26
  27. 27. UNINOR2.2 Working of Mutual FundThe idea behind a MF is that investors lack time, inclination or skills to manage their owninvestments. Professional managers, acting on behalf of the MF, manage the investmentsfor the benefit of investors in return for a management fee. The organization that managesthe investment is the Asset Management Company (AMC). In India, the operations of theAMC are supervised by a Board of Trustees/Trustee company.Mutual Fund investments are Collective Investment Schemes, which collect contributionfrom the subscribers and invest them in a variety of transferable assets such as ordinaryshares and bonds.These Trusts are run by experienced Investment Managers who use their knowledge andexpertise to select individual securities, which are classified to form portfolios that meetpredetermined objectives and criteria. These portfolios are then sold to the public.Thus a Mutual Fund is a trust that pools the savings of a number of investors who share acommon financial goal. The money thus collected is invested by the fund manager indifferent types of securities depending upon the objective of the scheme. These could rangefrom shares to debentures to money market instruments. The income earned through theseinvestments and the capital appreciations realized by the scheme are shared by its unitholders in proportion to the number of units owned by them. Thus a Mutual Fund is themost suitable investment for the common man as it offers an opportunity to invest in adiversified, professionally managed portfolio at a relatively low cost. The small savings ofall the investors are put together to increase the buying power and hire a professionalmanager to invest and monitor the money. Anybody with an investible surplus of as little asa few thousand rupees can invest in Mutual Funds. 27
  28. 28. UNINORSource: Association of mutual Fund India2.3 Regulatory AuthorityTo protect the interest of the investors, SEBI formulates policies and regulates the mutualfunds. It notified regulations in 1993 (fully revised in 1996) and issues guidelines from timeto time. MF either promoted by public or by private sector entities including one promoted byforeign entities is governed by these Regulations.SEBI approved Asset Management Company (AMC) manages the funds by makinginvestments in various types of securities. Custodian, registered with SEBI, holds thesecurities of various schemes of the fund in its custody.According to SEBI Regulations, two thirds of the directors of Trustee Company or board oftrustees must be independent.The Association of Mutual Funds in India (AMFI) reassures the investors in units of mutualfunds that the mutual funds function within the strict regulatory framework. Its objective is toincrease public awareness of the mutual fund industry.AMFI also is engaged in upgrading professional standards and in promoting best industrypractices in diverse areas such as valuation, disclosure, transparency etc. 28
  29. 29. UNINOR2.4 Advantages of mutual funds for investors Professional Management: Mutual funds offer investors the opportunity to earn an income or build their wealth through professional management of their investible funds. These are managed by investing in synchronization with the investment objective, investing based on adequate research and ensuring that prudent investment processes are followed. Portfolio Diversification: The units of scheme provide the investors an exposure to a variety of securities held in the investment portfolio of the scheme. Hence with diversification the investor is less likely to be exposed to the risks. Economies of Scale: The pool of money makes it possible for mutual fund to engage professional managers to manage the investment. Individual investors with small amounts to invest cannot afford to engage such professional management by themselves. Large corpus leads to various other economies of scale. For instance, costs related to investment research and office space get distributed across the investors. Further the greater transaction volume makes it possible to negotiate better terms with brokers, bankers and other service providers. Liquidity: Sometimes the investors in the financial markets are stuck with a security for which they cannot find any buyers or they even cannot find the company they invested in. Hence such investments become illiquid which can lead to huge losses to the investors. The investors in mutual fund scheme can recover the value of the money invested from the mutual fund itself. Tax deferral: Mutual funds are not liable to pay tax on the income they earn. Mutual funds offer options whereby the investor can let the money grow in the scheme for several years. By choosing for such options it becomes possible for the investor to defer tax liability. 29
  30. 30. UNINOR Tax benefits: Certain schemes of mutual funds provide the investors the benefits of deduction of the amount invested, from their income that is liable to tax. This reduces their taxable income, and hence the tax liabilities. Convenient options: The options offered under a scheme allow investors to structure their investments in line with their liquidity preference and tax position. Investment comfort: Once an investment is made in a mutual fund, they make it easy for the investor to further purchase with very little documentations. Hence this simplifies subsequent investment activities. Regulatory comfort: The Securities and Exchange Board of India (SEBI) has mandated strict checks and balances in the structure of mutual funds and their activities. The benefits of the investors are hence protected. Systematic approach to investments: Mutual funds also offer facilities that help the investor to invest and withdraw amounts on a regular basis or to move money among different types of schemes through Systematic Investment Plan (SIP), Systematic Withdrawal Plan (SWP) and Systematic Transfer Plan (STP) respectively. Such approaches impart an investment discipline.30
  31. 31. UNINOR2.5 Limitations of mutual funds Lack of portfolio customization: Mutual funds offer Portfolio Management Schemes (PMS) to a large number of investors. But the unit-holder is merely one of the several investors in a scheme. The investment management is purely made as per the nature of the fund manager, who may be highly risk averse or risk taking. Thus an individual unit holder cannot influence as to where the investments should be made. Choice Overload: A huge number of mutual fund schemes are available in the market. Over 800 mutual fund schemes are offered by 38 mutual funds, further there are multiple options available within the schemes. This choice overload makes it difficult for the investors to choose between these wide varieties.2.6 Types of fundsThe mutual funds can be classified into following categories: Open-Ended Funds: These are open for investors to buy or sell or in other words enter or exit at any time of the year, even after the NFO period is over. Closed-Ended Funds: These have a fixed maturity. Investors can buy units of closed ended scheme, from the fund, only during NFO period. Further the units are traded over a stock exchange, post NFO. Interval Funds: These funds combine the features of both open ended and closed ended schemes. These schemes remain close ended largely, but they become open ended at pre- determined time intervals.The aforementioned schemes are classified as per the structure of the scheme. 31
  32. 32. UNINOR Growth Schemes: These schemes tend to provide optimal returns through capital appreciation. These schemes majorly invest in the equities so there may be a decline in their value for a short period of time but they do deliver results in long run. Income Schemes: These schemes provide regular and steady returns. The investments made by these schemes are generally in the fixed income securities like bonds and debentures. Their returns are certainly lesser than the growth schemes but they are comparatively less risky. Balanced Schemes: Balanced schemes give the investor the best of growth and income schemes as it invests both in equities and in fixed income securities. Their returns are less volatile than the equity schemes. Tax Saving Scheme: These schemes offer deduction from gross total income to the investors under Sec. 80C of Income Tax Act. The investment made to any ELSS i.e Equity Linked Saving Scheme are eligible for deduction up to Rs.1,00,000/- every fiscal year. Theses schemes are growth oriented and have a major part invested in equities.The aforementioned schemes are classified on the basis of the objective of the schemes. Actively Managed Funds: Here the fund manager has the liberty to choose the investment portfolio in line with the investment objective of the scheme. Such schemes therefore incur higher expenses in the course of running. These schemes are expected to perform better in than the market. Passive Funds: These schemes invest as per the specific index, the performance of which it seeks to track. Hence here a particular market would buy only those securities which compose its index. The proportion of the shares would also be the same as assigned to the shares in the computation of the index. Thus the performance of these schemes reflects the performance of the index concerned. Hence they are said to be Index 32
  33. 33. UNINORSchemes. These have a low cost of operation unlike the actively managed schemesbecause here the portfolio is determined by the index only and the fund manager has aminimal role to play.Equity Schemes: These schemes invest the bulk of their corpus in equity shares and inthe equity related investments namely, convertible debentures. The equity schemes mayfall in the following categories:  Diversified Equity Fund: These are the funds that invest in a diverse mix of equity stocks across the sectors.  Sector Funds: The investments made here are sector specific. For example, IT sector, Gold sector etc.  Thematic Funds: These funds invest in line with an investment theme, like infrastructure, cement, steel, telecom etc.  Equity Linked Saving Schemes (ELSS): These schemes offer tax benefits to the investors. However the investor should retain the units for at least three years.  Equity Income / Dividend Yield Schemes: Here the investments are made in such securities whose shares fluctuate less; hence the dividend is a representative of a large proportion of the returns on those shares.  Arbitrage Funds: These funds take contrary positions in different markets / securities, such that the risk is neutralized but the return is earned.Debt Schemes: These schemes invest typically in the debt securities like treasury bills,Government securities, bonds and debentures. The debt funds may fall into followingcategories:33
  34. 34. UNINOR  Gilt Funds: These schemes invest only in the treasury bills and government securities. These instruments do not have any credit risk attached to them.  Diversified Debt Funds: These schemes invest in a mix of government and non- government debt securities. So here there is a diversification of debt securities in the investment portfolio.  Junk Bond Schemes / High Yield Bond Schemes: These schemes invest in the companies that are of poor credit quality. Such schemes operates on the philosophy that the attractive returns offered by the investee companies make up the losses incurred out of defaulting companies.  Fixed Maturity Plan (FMP): Here the investment portfolio is closely with the maturity of the scheme. AMCs tend to structure the scheme around the pre- identified investments. Like close ended schemes these do not accept any investments post NFO period.  Floating Rate Funds: These funds invest in the debt securities where the interest rate payable by the issuer changes as per the market.  Liquid Schemes / Money Market schemes: These schemes invest in the debt securities where the money will be repaid in 91 days. These are known to have the lowest risk among all kinds of mutual fund schemes.Hybrid Schemes: These schemes invest in debt and equity instruments both. The hybridfunds are of following types:  Monthly Income Plan: These schemes have an exposure of 70-90% to debt and an exposure of 10-30% to equity. These seek to declare a dividend every month. Hence it invests largely in debt securities. However a small percentage is invested in equity shares just to improve the yield.34
  35. 35. UNINOR  Capital Protected Scheme: These are close-ended schemes and they ensure that whatever the market conditions be, the investor would get his principle back. This is done by investing in Zero Coupon Government Securities. The scheme’s maturity and the coupon security have a lined up maturity time.Gold Funds: These funds invest in gold and gold related securities. They can bestructured in the following formats:  Gold Exchange Traded Fund: It is like an index fund which invests in gold. The NAV of these funds moves as per the gold prices in the market.  Gold Sector Funds: It invests in the shares of the companies that are involved in gold mining and processing. The NAV of these funds do not reflect the gold prices because the prices of these shares are linked with the gold reserves and the profitability of the companies.Real Estate Funds: These funds make it possible for the retail investors to get theexposure of the real estate.Commodity Funds: Commodities as an asset group include food crops, spices, fibres,industrial metals, energy products like oil and natural gas and precious metals like goldand silver. The investment objective will determine which commodities to invest in.International Funds: These are the funds that invest outside of the country. Thedomestic investments are invested abroad. Alternatively, a tie up a foreign fund, said tobe the Host Fund, is made and a Feeder Fund will be launched domestically. Thedomestic investors will invest in the feeder fund and this collection will in turn beinvested in the host fund. Thus when the foreign market does well, the host fund will dowell and hence the feeder fund will follow the suit domestically. The investments can bespecific to a country or can be diversified across the nations.35
  36. 36. UNINOR Fund of Funds: Funds that are structured to invest in various other funds are said to be the Fund of Funds. These funds can invest in the funds within the country or abroad as specified. Exchange Traded Funds (ETF): These are open ended index funds that are traded over a stock exchange. But the feature of an open ended fund to trade the units from the mutual fund is made available only to very large investors in an ETF. Others will have to do the trading over the stock exchange. Index Fund: These funds invest in a portfolio that replicates the portfolio of a particular index like the BSE sensitive index. S&P NSE Nifty 50 index. These invest in the securities in the same weights as comprising of an index. Hence the Index Scheme appreciates or depreciates the same way as the index. The main objective of this scheme is to give returns in line with the index. Sector Specific Fund: These take an advantage of upturn or expected upturn in a particular sector or industry by investing in them. The returns of these schemes are purely dependent on the performance of the particular sector or industry as the case may be. Though these funds give optimal returns but they are riskier than the diversified equity funds that invest across sectors.2.7 Types of returnsThere are three ways, where the total returns provided by mutual funds can be enjoyed byinvestors: Income is earned from dividends on stocks and interest on bonds. A fund pays out nearly all income it receives over the year to fund owners in the form of a distribution. If the fund sells securities that have increased in price, the fund has a capital gain. Most funds also pass on these gains to investors in a distribution. 36
  37. 37. UNINOR If fund holdings increase in price but are not sold by the fund manager, the funds shares increase in price. You can then sell your mutual fund shares for a profit. Funds will also usually give you a choice either to receive a check for distributions or to reinvest the earnings and get more shares.2.8 Performance Measures Of Mutual FundsReturn alone should not be considered as the basis of measurement of the performance of amutual fund scheme, it should also include the risk taken by the fund manager becausedifferent funds will have different levels of risk attached to them. Risk associated with afund, in a general, can be defined as variability or fluctuations in the returns generated by it.The higher the fluctuations in the returns of a fund during a given period, higher will be therisk associated with it. These fluctuations in the returns generated by a fund are resultant oftwo guiding forces. First, general market fluctuations, which affect all the securities, presentin the market, called market risk or systematic risk and second, fluctuations due to specificsecurities present in the portfolio of the fund, called unsystematic risk. The Total Risk of agiven fund is sum of these two and is measured in terms of standard deviation of returns ofthe fund. Systematic risk, on the other hand, is measured in terms of Beta, which representsfluctuations in the NAV of the fund vis-�-vis market. The more responsive the NAV of amutual fund is to the changes in the market; higher will be its beta. Beta is calculated by 37
  38. 38. UNINORrelating the returns on a mutual fund with the returns in the market. While unsystematic riskcan be diversified through investments in a number of instruments, systematic risk cannot.By using the risk return relationship, we try to assess the competitive strength of the mutualfunds vis-�-vis one another in a better way.BetaBeta, also known as the "beta coefficient," is a measure of the volatility, or systematic risk,of a security or a portfolio in comparison to the market as a whole. Beta is calculatedusing regression analysis, and you can think of it as the tendency of an investments return torespond to swings in the market. By definition, the market has a beta of 1.0. Individualsecurity and portfolio values are measured according to how they deviate from the market.Conservative investors looking to preserve capital should focus on securities and fundportfolios with low betas, whereas those investors willing to take on more risk in search ofhigher returns should look for high beta investments.Standard DeviationStandard Deviation is a measure of how much the actual performance of a fund over a periodof time deviates from the average performance.Since Standard Deviation is a measure of risk, a low Standard Deviation is good.TreynorDeveloped by Jack Treynor, this performance measure evaluates funds on the basis ofTreynors Index. This Index is a ratio of return generated by the fund over and above riskfree rate of return (generally taken to be the return on securities backed by the government,as there is no credit risk associated), during a given period and systematic risk associatedwith it (beta). Symbolically, it can be represented as:Treynors Index (Ti) = (Ri - Rf)/Bi.Where, Ri represents return on fund, Rf is risk free rate of return and Bi is beta of the fund.All risk-averse investors would like to maximize this value. While a high and positiveTreynors Index shows a superior risk-adjusted performance of a fund, a low and negativeTreynors Index is an indication of unfavorable performance. 38
  39. 39. UNINORSharpeIn this model, performance of a fund is evaluated on the basis of Sharpe Ratio, which is aratio of returns generated by the fund over and above risk free rate of return and the total riskassociated with it. According to Sharpe, it is the total risk of the fund that the investors areconcerned about. So, the model evaluates funds on the basis of reward per unit of total risk.Symbolically, it can be written as:Sharpe Index (Si) = (Ri - Rf)/SiWhere, Si is standard deviation of the fund.While a high and positive Sharpe Ratio shows a superior risk-adjusted performance of afund, a low and negative Sharpe Ratio is an indication of unfavourable performance.2.9 Analysis of different mutual fund schemes, category wise as on may2010Different categories of Open ended schemes are as follow:Liquid fundsGilt funds- short and longDebt fundsEquity sector fundsBalanced fundsDebt (short term) fundsDebt (MIP) 39
  40. 40. UNINORNow for all the categories top 5 schemes from last 5 years:Liquid funds RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION Escorts Liquid Plan - 15.04 7.79 7.55 1 Growth Sahara Liquid Fund - 1811.14 7.4 7.27 Variable Pricing 2 Option - Growth ICICI Prudential 146.36 7.29 7.2 Liquid - Super 3 Institutional Plan - Growth Sahara Liquid Fund - 1796.37 7.25 6.55 4 Fixed Pricing Option - Growth LIC Nomura MF 18.09 7.25 6.68 5 Liquid Fund - GrowthScheme performance % as on May, 2011/ Return Months/year 1month 3month 6month 1year 3year 5year Escorts Liquid Plan 0.83 2.41 4.92 8.32 7.83 7.79 - Growth Sahara Liquid Fund 0.76 2.31 4.29 7.31 7.22 7.40 - Variable Pricing Option - Growth ICICI Prudential 0.69 2.07 4.00 7.00 6.77 7.29 Liquid - Super Institutional Plan - Growth 40
  41. 41. UNINORSahara Liquid Fund 0.75 2.28 4.25 7.27 7.12 7.25- Fixed PricingOption - GrowthLIC Nomura MF 0.67 2.00 3.82 6.81 6.81 7.25Liquid Fund -GrowthGraph 9 Escorts Liquid Plan - Growth 8 7 6 Sahara Liquid Fund - Variable Pricing Option - Growth 5 4 ICICI Prudential Liquid - Super Institutional Plan - Growth 3 2 Sahara Liquid Fund - Fixed 1 Pricing Option - Growth 0 LIC Nomura MF Liquid Fund - 1month 3month 6month 1year 3year 5year GrowthRiskschemes Mean Standard sharpe beta treynor deviationEscorts Liquid Plan - 0.81 0.02 3.77 0.01 14.61GrowthSahara Liquid Fund - 0.17 0.02 3.73 0.09 0.73Variable PricingOption - GrowthICICI Prudential 0.16 0.02 2.37 0.02 2.34Liquid - SuperInstitutional Plan -GrowthSahara Liquid Fund - 0.16 0.02 3.52 0.09 0.68Fixed Pricing Option- GrowthLIC Nomura MF 0.17 0.02 2.59 0.04 1.55Liquid Fund -Growth 41
  42. 42. UNINORInterpretationAs beta of Escorts Liquid Plan - Growth and ICICI Prudential Liquid - Super InstitutionalPlan - Growth is 0.01 and 0.02 respectively; therefore they are not much related to marketrisk hence it is less risky. Vice-versa for Sahara Liquid Fund - Variable Pricing Option -Growth and Sahara Liquid Fund - Fixed Pricing Option - Growth schemes.Escorts Liquid Plan - Growth, Sahara Liquid Fund - Variable Pricing Option - Growth andSahara Liquid Fund - Fixed Pricing Option - Growth have positive and high ratio ascompared to ICICI Prudential Liquid - Super Institutional Plan - Growth and LIC NomuraMF Liquid Fund - Growth therefore they have a superior risk adjusted performance.Escorts Liquid Plan - Growth scheme has very high trey nor as compared to other schemes,hence it has superior risk adjusted performance. Sahara Liquid Fund - Variable PricingOption - Growth schemes has low risk adjusted performance.Gilt fund- short and long term RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION ICICI Prudential Gilt 19.28 11.87 9.17 1 Fund Investment Plan - PF Option - Growth ICICI Prudential Gilt 33.33 9.6 10.81 Fund Investment 2 Plan - Growth Escorts Gilt Plan - 21.77 8.66 8 Growth 3 JM G Sec Regular 31.16 8.66 10.28 4 Plan - Growth Birla Sun Life Govt 28.54 8.43 9.51 5 Securities Fund - Long Term - Growth 42
  43. 43. UNINORScheme performance % as on May, 2011/ returnMonths/year 1month 3month 6month 1year 3year 5yearICICI Prudential -0.80 0.49 1.81 4.80 14.32 11.87Gilt FundInvestment Plan -PF Option -GrowthICICI Prudential -0.45 0.99 2.54 5.40 11.07 9.60Gilt FundInvestment Plan -GrowthEscorts Gilt Plan - -0.12 2.55 3.23 5.77 12.04 8.66GrowthJM G Sec Regular 0.41 1.61 2.75 3.05 12.06 8.66Plan - GrowthBirla Sun Life Govt 0.36 1.14 2.53 5.68 12.83 8.43Securities Fund -Long Term -GrowthGraph 16 14 ICICI Prudential Gilt Fund Investment Plan - PF Option 12 - Growth ICICI Prudential Gilt Fund 10 Investment Plan - Growth 8 Escorts Gilt Plan - Growth 6 4 JM G Sec Regular Plan - Growth 2 0 Birla Sun Life Govt Securities 1month 3month 6month 1year 3year 5year Fund - Long Term - Growth -2 43
  44. 44. UNINORRisk schemes mean Standard Sharpe beta trey nor deviation ICICI Prudential Gilt 0.75 2.10 0.31 1.47 0.44 Fund Investment Plan - PF Option - Growth ICICI Prudential Gilt 0.59 1.93 0.25 1.35 0.36 Fund Investment Plan - Growth Escorts Gilt Plan - 0.59 1.61 0.30 0.69 0.70 Growth JM G Sec Regular 0.55 1.32 0.34 0.73 0.61 Plan - Growth Birla Sun Life Govt 0.46 1.81 0.30 0.35 1.00 Securities Fund - Long Term - GrowthInterpretationAs Birla Sun Life Govt Securities Fund - Long Term - Growth scheme and Escorts Gilt Plan- Growth has lower beta therefore it is less related with the market fluctuations and hencelower the risk.Vice versa for ICICI Prudential Gilt Fund Investment Plan - PF Option - Growth and ICICIPrudential Gilt Fund Investment Plan – Growth, beta is high so risk involve is also high ascompared to the other schemes.Almost all the schemes have positive and high ratio therefore it is a indication of favourableperformance.Birla Sun Life Govt Securities Fund - Long Term - Growth scheme has highest trey nor so itis a superior risk adjusted performer as compared to others schemes 44
  45. 45. UNINORDebt fundsRANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION Escorts Income 29.77 11.59 8.71 Bond - Growth Reliance Monthly 21.81 10.73 11.2 Income Plan -2 Growth HDFC Monthly 23.06 10.56 11.99 Income Plan - Long3 Term Plan - Growth Canara Robeco 20.79 10.33 8.844 Income Scheme - Growth Canara Robeco 29.6 9.98 6.795 Monthly Income Plan - GrowthScheme performance % as on May, 2011/ returnMonths/year 1month 3month 6month 1year 3year 5yearEscorts Income -0.54 -3.12 -13.60 25.58 12.97 11.59Bond - GrowthReliance Monthly 0.19 3.62 -0.11 6.51 14.71 10.73Income Plan -GrowthHDFC Monthly -0.43 3.49 -0.49 7.75 11.99 10.56Income Plan - LongTerm Plan –GrowthCanara Robeco 0.36 1.68 3.13 5.24 12.94 10.33Income Scheme -GrowthCanara Robeco -0.02 2.62 0.84 6.06 10.59 9.98Monthly Income 45
  46. 46. UNINORPlan - GrowthGraph 30 25 20 escorts Income Bond - Growth 15 Reliance Monthly Income 10 Plan - Growth HDFC Monthly Income Plan 5 - Long Term Plan - Growth 0 Canara Robeco Income Scheme - Growth -5 1month3month6month 1year 3year 5year Canara Robeco Monthly -10 Income Plan - Growth -15 -20Riskschemes mean Standard sharpe beta treynor deviation Escorts Income 0.04 0.69 -0.10 0.06 -1.19 Bond - GrowthReliance Monthly 0.43 1.53 0.21 1.15 0.28Income Plan -GrowthHDFC Monthly 0.13 1.48 0.01 1.27 0.02Income Plan - LongTerm Plan - GrowthCanara Robeco 0.56 0.79 0.57 4.77 0.09Income Scheme -GrowthCanara Robeco 0.17 1.67 0.04 0.21 0.31Monthly IncomePlan - Growth 46
  47. 47. UNINORInterpretationEscorts Income Bond - Growth and Canara Robeco Monthly Income Plan - Growth has alow beta hence lower the risk involves as compared to others.Escorts Income Bond - Growth has a negative Sharpe and treynor therefore it is an indicatorof unfavourable performance whereas Canara Robeco Income Scheme - Growth has a highSharpe and Canara Robeco Monthly Income Plan - Growth scheme has high treynor ascompared to others.EQUITY RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION Reliance Banking 101.99 24.06 33.87 1 Fund - Growth Reliance Pharma 54.85 20.63 27.83 Fund - Growth 2 UTI Banking Sector 42.43 19.82 22.32 Fund - Growth 3 IDFC Premier 31.71 18.15 22.81 4 Equity Fund - Plan A - Growth Reliance Diversified 69.33 17.32 31.82 5 Power Sector Fund - Growth 47
  48. 48. UNINORScheme performance % as on May, 2011/ returnMonths/year 1month 3month 6month 1year 3year 5yearReliance Banking -6.43 7.69 -18.65 19.09 22.58 24.06Fund - GrowthReliance Pharma 0.08 7.49 -5.60 11.31 32.31 20.63Fund - GrowthUTI Banking -6.60 8.16 -17.08 15.17 17.60 19.82Sector Fund -GrowthIDFC Premier -3.28 11.85 13.84 11.41 14.32 18.15Equity Fund - PlanA - GrowthReliance -5.54 6.01 -22.27 -12.49 2.13 17.32Diversified PowerSector Fund -GrowthGraph 40 30 Reliance Banking Fund - 20 Growth Reliance Pharma Fund - Growth 10 UTI Banking Sector Fund - Growth 0 IDFC Premier Equity Fund 1month 3month 6month 1year 3year 5year - Plan A - Growth -10 Reliance Diversified Power Sector Fund - Growth -20 -30 48
  49. 49. UNINORRisk schemes mean Standard sharpe beta treynor deviation Reliance Banking -0.09 6.37 -0.03 0.99 -0.20 Fund - Growth Reliance Pharma -0.13 4.01 -0.06 0.87 -0.27 Fund - Growth UTI Banking Sector -0.10 6.92 -0.03 1.08 -0.19 Fund - Growth IDFC Premier Equity -0.51 4.49 0.14 0.69 -0.89 Fund - Plan A - Growth Reliance Diversified -0.53 4.66 -0.14 0.75 -0.85 Power Sector Fund - GrowthInterpretationAs equity schemes are highly risky therefore beta in these schemes are relatively high as wecan see in the above schemes.Sharpe is also negative in three and treynor is also negative for all the schemes which meanunfavourable performance of funds.EQUITY SECTOR FUNDS RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION Reliance Banking 101.99 24.06 33.87 1 Fund - Growth Reliance Pharma 54.85 20.63 27.83 Fund - Growth 2 UTI Banking Sector 42.43 19.82 22.32 Fund - Growth 3 Reliance Diversified 69.33 17.32 31.82 4 Power Sector Fund - Growth 49
  50. 50. UNINOR Franklin Pharma 62.66 14.97 16.355 Fund - GrowthScheme performance % as on May, 2011/ returnMonths/year 1month 3month 6month 1year 3year 5yearReliance Banking -6.43 7.69 -18.65 19.09 22.58 24.06Fund - GrowthReliance Pharma 0.08 7.49 -5.60 11.31 32.31 20.63Fund - GrowthUTI Banking -6.60 8.16 -17.08 15.17 17.60 19.82Sector Fund -GrowthReliance -5.54 6.01 -22.27 -12.49 2.13 17.32Diversified PowerSector Fund -GrowthFranklin Pharma 0.17 6.14 -4.70 14.40 29.71 14.97Fund - GrowthGraph 40 30 Reliance Banking Fund - Growth 20 Reliance Pharma Fund - Growth 10 UTI Banking Sector Fund - Growth 0 Reliance Diversified Power 1month 3month 6month 1year 3year 5year Sector Fund - Growth -10 Franklin Pharma Fund - Growth -20 -30 50
  51. 51. UNINORRisk schemes mean Standard sharpe beta treynor deviation Reliance Banking -0.09 6.37 -0.03 0.99 -0.20 Fund - Growth Reliance Pharma -0.13 4.01 -0.06 0.87 -0.27 Fund - Growth UTI Banking Sector -0.10 6.92 -0.03 1.08 -0.19 Fund - Growth Reliance Diversified -0.53 4.66 -0.14 0.75 -0.85 Power Sector Fund - Growth Franklin Pharma -0.16 3.16 -0.08 0.72 -0.36 Fund - GrowthInterpretationFranklin Pharma Fund - Growth and Reliance Diversified Power Sector Fund - Growthschemes has relatively lower beta which means risk is lass associated with these funds ascompared to UTI Banking Sector Fund - Growth and Reliance Banking Fund - Growth.Sharpe and treynor are low and negative which is an indicator of unfavourable performance.Equity diversified RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION IDFC Premier 31.71 18.15 22.81 1 Equity Fund - Plan A - Growth Reliance Regular 30.02 17.06 20.36 Savings Fund - 2 Equity - Growth UTI Dividend Yield 32.24 15.69 21.69 Fund - Growth 3 Quantum Long- 21.87 15.58 16.37 4 Term Equity Fund - Growth Quantum Long- 278.81 15.13 22.55 51
  52. 52. UNINOR5 Term Equity Fund - GrowthScheme performance % as on May, 2011/ return Months/year 1month 3month 6month 1year 3year 5year IDFC -3.28 11.85 -13.84 11.41 14.32 18.15 Premier Equity Fund - Plan A - Growth Reliance -2.96 6.46 -15.15 4.51 9.46 17.06 Regular Savings Fund - Equity - Growth UTI -3.07 7.68 -9.72 11.94 15.88 15.69 Dividend Yield Fund - Growth Quantum -4.29 5.09 -10.66 12.73 15.25 15.58 Long-Term Equity Fund - Growth Quantum -2.60 8.68 -11.59 15.58 17.03 15.13 Long-Term Equity Fund - GrowthGraph 52
  53. 53. UNINOR 20 15 IDFC Premier Equity Fund - Plan A - Growth 10 Reliance Regular Savings Fund - Equity - Growth 5 UTI Dividend Yield Fund 0 - Growth Quantum Long-Term Equity 1month 3month 6month 1year 3year 5year -5 Fund - Growth Quantum Long-Term Equity -10 Fund - Growth -15 -20Risk schemes mean Standard sharpe beta treynor deviation IDFC Premier Equity -0.51 4.49 -0.14 0.69 -0.89 Fund - Plan A - Growth Reliance Regular -0.55 5.26 -0.13 0.88 -0.75 Savings Fund - Equity - Growth UTI Dividend Yield -0.24 3.93 -0.09 0.65 -0.53 Fund - Growth Quantum Long-Term -0.42 4.64 -0.11 0.77 -0.69 Equity Fund - Growth Quantum Long-Term -0.34 5.28 -0.08 0.87 -0.51 Equity Fund - GrowthInterpretationIn the entire schemes beta is high which means they are associated with market risk, whichmake them risky funds.Sharpe and treynor are low and negative which is an indicator of unfavourable performance. 53
  54. 54. UNINORBalancedRANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION HDFC Prudence 212.39 16.36 19.451 Fund - Growth Reliance Regular 22.06 14.58 14.29 Savings Fund -2 Balanced - Growth Birla Sun Life 95 - 308.35 12.88 23.48 Growth3 HDFC Balanced 55.8 12.8 17.494 Fund - Growth DSP BlackRock 65.5 12.5 17.015 Balanced Fund - GrowthScheme performance % as on May, 2011/ returnMonths/year 1month 3month 6month 1year 3year 5yearHDFC Prudence -1.89 7.90 -7.35 13.75 17.21 16.36Fund - GrowthReliance Regular -1.72 5.73 -11.72 6.46 15.78 14.58Savings Fund -Balanced - Growth 54
  55. 55. UNINORBirla Sun Life 95 - -2.73 5.28 -7.14 9.31 12.62 12.88GrowthHDFC Balanced -0.47 9.98 4.16 16.64 16.01 12.80Fund - GrowthDSP BlackRock -2.08 6.33 -8.81 7.54 9.96 12.50Balanced Fund -GrowthGraph 20 15 HDFC Prudence Fund - Growth 10 Reliance Regular Savings Fund - Balanced - Growth 5 Birla Sun Life 95 - Growth 0 HDFC Balanced Fund - Growth 1month 3month 6month 1year 3year 5year -5 DSP BlackRock Balanced Fund - Growth -10 -15Risk schemes mean Standard sharpe beta treynor deviationHDFC Prudence -0.31 3.80 -0.11 0.94 -0.45Fund - GrowthReliance Regular -0.07 4.35 -0.04 1.08 -0.16Savings Fund -Balanced - GrowthBirla Sun Life 95 - -0.21 3.54 -0.09 0.83 -0.39 55
  56. 56. UNINOR Growth HDFC Balanced -0.26 3.68 -0.10 0.91 -0.40 Fund - Growth DSP BlackRock -0.34 2.92 -0.15 0.72 -0.16 Balanced Fund - GrowthInterpretationIn the entire schemes beta is high which means they are associated with market risk, whichmake them risky funds.Sharpe and treynor are low and negative which is an indicator of unfavourable performance.Debt short term RANK SCHEMES NAV(Rs) LAST 5 SINCE YEARS INCEPTION JM Short Term Fund 19.4 9.05 7.75 1 - Growth Templeton India 1585.55 8.98 8.47 Short Term Income 2 Plan - Institutional Plan - Growth Templeton India 1972.32 8.83 7.6 Short Term Income 3 Plan - Growth ICICI Prudential 20.53 8.74 7.74 4 Short Term Institutional Plan - Growth HDFC High Interest 19.45 8.66 7.45 5 Fund - Short Term Plan - GrowthScheme performance % as on May, 2011/ return Months/year 1month 3month 6month 1year 3year 5year JM Short Term 0.84 2.29 4.01 6.91 9.41 9.05 Fund - Growth Templeton India 0.67 2.35 3.42 5.80 9.15 8.98 56
  57. 57. UNINORShort Term IncomePlan - InstitutionalPlan - GrowthTempleton India 0.65 2.30 3.32 5.58 8.99 8.83Short Term IncomePlan - GrowthICICI Prudential 0.46 2.22 3.04 5.00 8.97 8.74Short TermInstitutional Plan -GrowthHDFC High 0.13 1.88 2.53 4.51 8.49 8.66Interest Fund -Short Term Plan -GrowthGraph 10 9 JM Short Term Fund - Growth 8 7 Templeton India Short Term Income Plan - 6 Institutional Plan - Growth 5 Templeton India Short Term Income Plan - Growth 4 3 ICICI Prudential Short Term Institutional Plan - Growth 2 1 HDFC High Interest Fund - Short Term Plan - Growth 0 1month 3month 6month 1year 3year 5yearRisk schemes mean Standard sharpe beta treynor deviationJM Short Term Fund 0.29 0.48 0.39 0.80 0.23- GrowthTempleton India 0.21 0.22 0.45 0.73 0.14Short Term IncomePlan - InstitutionalPlan - Growth 57
  58. 58. UNINOR Templeton India 0.20 0.22 0.44 0.73 0.13 Short Term Income Plan - Growth ICICI Prudential 0.32 0.57 0.38 1.78 0.12 Short Term Institutional Plan - Growth HDFC High Interest 0.25 0.31 0.47 1.08 0.14 Fund - Short Term Plan - GrowthInterpretationICICI Prudential Short Term Institutional Plan - Growth and HDFC High Interest Fund -Short Term Plan – Growth has relatively higher beta which means they are more riskier thenJM Short Term Fund - Growth, Templeton India Short Term Income Plan - InstitutionalPlan - Growth and Templeton India Short Term Income Plan - Growth.Sharpe and treynor ratios has positive values for all the schemes which shows a superior riskadjusted performance of a funds.ASSET UNDER MANAGEMENT AND FOLIOS - CATEGORY WISE -AGGREGATE - AS ON March 31, 2011 Types of Investor AUM(Rs.cr) % to total No of folios % to total schemes classification Liquid/ Corporate 57132.60 76.48 11598 6.00 Money Market Bank/ FIs 12749.77 17.07 387 0.20 Gilt corporate 2656.31 75.74 3135 10.74 Bank/ FIs 17.14 0.49 27 0.09 Debt Corporate 178458.49 60.66 83366 1.94 oriented Bank/ FIs 10317.33 3.51 1288 0.03 Equity corporate 21088.30 10.67 22777 0.58 Oriented Bank/ FIs 2194.82 1.11 9943 0.03 Balanced corporate 2144.29 12.22 17036 0.61 Bank/ FIs 42.30 0.24 76 0.00 58
  59. 59. UNINOR Chapter 3 GOVERNMENT SECURITIES59

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