Internship _report_AT IDFC MUTUAL FUNDS.pdf

A
Summer Training Project Report
On
“A COMPARATIVE STUDY OF MUTUAL FUND”
AT
IDFC ASSET MANAGEMENT COMPANY LTD.
Submitted for partial fulfillment of requirement for the award of degree
Of
Master of Business Administration
Of
Doranda College, Ranchi
Session : 2020 - 22
Supervision By:- Submitted by:-
Mr. Hemchandra Tiwari Pranav Kumar Singh
Professor of Finance Roll No.- 20MBA01107
Dept. Of MBA MBA III Semester

Pranav Kr Singh
DECLARATION
I the undersigned solemnly declare that the report of the project work entitled “A
comparative Study of Mutual Fund” at IDFC assets management company ltd., is
based my own work carried out during the course of my study under the
supervision of Prof. Hemchandra Tiwari
I assert that the statements made and conclusions drawn are an outcome of the
project work. I further declare that to the best of my knowledge and belief that the
project report does not contain any part of any work which has been submitted for
the award of any other degree/diploma/certificate in this University or any other
University.
____________________
Pranav Kumar Singh
Roll no.- 20MBA01107

Pranav Kr Singh
CERTIFICATE BY SUPERVISOR
This to certify that the report of the project submitted is the outcome of the project
work entitled “A comparative Study of Mutual Fund” carried out by Pranav
Kumar Singh bearing Roll No.- 20MBA01107 & Enrollment No.- BM0136/20
Carried by under my guidance and supervision for the award of Degree in Master
of Business Administration of Doranda College, Ranchi, Jharkhand.
To the best of the my knowledge the report
i. Embodies the work of the candidate him/herself,
ii. Has duly been completed,
iii. Fulfils the requirement of the ordinance relating to the MBA degree of
the University and
iv. Is up to the desired standard for the purpose of which is submitted.
(Signature of the Supervisor) (Signature of the Co-Ordinator)

Pranav Kr Singh
CERTIFICATE BY GUIDE (INTERNAL FACULTY OF UNIVERSITY)
This to certify that the report of the project submitted is the outcome of the project
work entitled “A comparative Study of Mutual Fund” carried out by Pranav
Kumar Singh bearing Roll No.- 20MBA01107 & Enrollment No.- BM0136/20
Carried by under my guidance and supervision for the award of Degree in Master
of Business Administration of Doranda College, Ranchi, Jharkhand.
To the best of the my knowledge the report
v. Embodies the work of the candidate him/herself,
vi. Has duly been completed,
vii. Fulfils the requirement of the ordinance relating to the MBA degree of
the University and
viii. Is up to the desired standard for the purpose of which is submitted.
(Signature of the Guide)
Mr. Hemchandra Tiwari
Professor of Finance
Department of MBA
Doranda College, Ranchi

Pranav Kr Singh
ACKNOWLEDGEMENT
The success and final output of this project study required a lot of guidance some
people and I am extremely fortunate to have got this all along the completion of
my project study of 6 weeks. Whatever I have done only due to such guidance. I
would not forget to thank them.
I would like to thank our MBA HEAD OF DEPARTMENT DR. SANJEEV
CHATURVEDI for giving as an opportunity to do the internship study and
providing us all the support and guidance which made us to complete the
internship on time. I also would like to thank our Principal DR. B.P.VERMA. I
extremely thank to guide PROF. HEMCHANDRA TIWARI for providing such
a nice support and guidance though he had a busy schedule and I thank to external
guide MR. ABHISHEK CHOUDHARY Branch Manager of IDFC MUTUAL
FUND ASSETS MANAGEMENT COMPANY LTD.
I thank all our lectures and also thank to our respondents who have furnished the
information for conducting a survey for this project study. I also thank and
fortunate enough to get constant encouragement, support and guidance from
college and my class mates.
__________________
Pranav Kumar Singh
Roll no.- 20MBA01107
MBA III Semester

Pranav Kr Singh
PREFACE
It is evidence that work experience is in indispensable part of every professional
course. In the same manner practical training in any organization is a must for
each and every individual management course. This training in any organization
is a must for each and every individual management course. This training gives
more knowledge about the present corporate world. It also helps the individual
to improve their skill to extent and assess his personality in corporate life.
Classroom study is no doubt quite important for gaining theoretical knowledge,
but practical knowledge is equally important for those who wants to improve
themselves with their working environment in any field of study. Thus truth of
management studied well.
We generally get theoretical knowledge of management, but this knowledge
does not prove to be adequate. In future, management student have to work in
an organization. By merely knowing theoretical what management is, we are
not capable of applying it.
In this project I have dealt with many aspect and theories which is relevant for
this topic. I focused to each aspect as far as possible which was very essential to
this report.
PRANAV KUMAR SINGH

Pranav Kr Singh
ABSTRACT
Being such a hot and much talked about financial product in the recent times, I
take it as a great opportunity to study and analyze the Indian mutual fund Industry
and give my observation on it. It will not only help building my career but it will
also help financial literacy in certain aspect.
The Indian Mutual Funds Industry has witnessed a sea change since UTI was first
established in 1963. From a single player the number of players has increased to
more than 30 and the number of schemes has spiraled to more than 3500. The last
decade has been a period of rapid growth for the MF industry. The industry is in
nascent stage at present. It has come a long way and still has lots of potential for
growth.
My project in IDFC mainly deals with the comparative study in mutual fund at
IDFC with other several financial channels available in the market. And my main
aim is to attain profit for the company and give them good business. Fist part of
study, I undertake the research study survey through secondary data provided at
IDFC branch office, and with magazines, newspapers & internet fill up on
investment pattern in mutual fund by Investors. And after that I visited the list of
bank given to me TATA AIG, ICICI, Axis Bank etc. And Meet with Relationship
manager and try to give them knowledge about the product and then try to sale the
product to their client and Understanding of Investors perception and investment
pattern in mutual fund.
And in these project my main aim to see which schemes are giving better returns
and at a reasonable risk. But risk itself is a very subjective terms that depend on
person to person. And also how asset management companies are performing and
how their ranking in investment terms is.
And during the course of the project I have not only learnt about mutual fund
industry but also try to Understanding of Investors perception and investment
pattern in mutual fund at IDFC the company.

Pranav Kr Singh
Table of Contents
Chapter Title Page No.
01. INTRODUCTION
i. Concept of Mutual fund
ii. History of mutual fund
iii. Types of mutual fund based on different aspects
iv. Conceptual framework of Mutual fund
v. Features and advantages of Mutual fund
vi. Drawbacks of Mutual fund
vii. Tax benefits of mutual fund
viii. Regulatory body mutual fund
ix. Mode of Investment in mutual fund
x. Investment strategies
1-5
6-10
11-17
18-20
20-23
24-25
25-26
27
28-29
30-36
02. RESEARCH METHODOLOGY 38-40
03. LITERATURE REVIEW
i. Definations of Mutual fund
ii. How to calculate the value of Mutual funds
iii. Risk at investment in mutual fund
iv. Procedure to select mutual fund scheme
v. Conclusion of Mutual fund
42-46
47-49
50
51-52
53

Pranav Kr Singh
04. IDFC MUTUAL FUND COMPANY’S PROFILE
i. Overview of company
ii. Investment offerings
iii. Board of Directors
iv. Company structure
v. History and timelines
vi. IDFC Businesses
vii. SWOT Analysis
55-57
57-59
60
60
61-63
64-65
66
05. A COMPARATIVE ANALYSIS OF MUTUAL FUND
i. Average assets under management
ii. Mutual funds schemes analysis equity wise
iii. Schemes of IDFC Mutual fund
iv. Chronological order of companies giving most
return
68-69
70-72
73-74
75-76
06. FINDING 78
07. SUGESTIONS & RECOMMENDATION 79
08.
CONCLUSION
80
09.
BIBLIOGRAPHY
81

Pranav Kr Singh
Chapter – I
Introduction

Pranav Kr Singh
Page - 1
1.1 INTRODUCTION
The one investment vehicle that has truly come of age in India in the past decade
is mutual funds. Today, the mutual fund industry in the country manages around
Rs 329,162 crore (As of Dec, 2006) of assets, a large part of which comes from
retail investors. And this amount is invested not just in equities, but also in the
entire gamut of debt instruments. Mutual funds have emerged as a proxy for
investing in avenues that are out of reach of most retail investors, particularly
government securities and money market instruments.
Specialization is the order of the day, be it with regard to a scheme’s investment
objective or its targeted investment universe. Given the plethora of options on
hand and the hard-sell adopted by mutual funds vying for a piece of your savings,
finding the right scheme can sometimes seem a bit daunting. Mind you, it’s not
just about going with the fund that gives you the highest returns. It’s also about
managing risk–finding funds that suit your risk appetite and investment needs.
So, how can you, the retail investor, create wealth for yourself by investing
through mutual funds? To answer that, we need to get down to brass tacks–what
exactly is a mutual fund?
Very simply, a mutual fund is an investment vehicle that pools in the monies of
several investors, and collectively invests this amount in either the equity market
or the debt market, or both, depending upon the fund’s objective. This means you
can access either the equity or the debt market, or both, without investing directly
in equity or debt.

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Page - 2
The essential features of the mutual funds distinguishing from other of the
investments are:-
 The mutual fund is a trust into which many relatively small investors invest
their money to form a large pool of cash which is then invested in securities by
the manager of the trust.
 The price at which units can be bought and sold is governed solely by the value
of the underlying securities held by the MF and dealing in units are on the basis
of net market value of the investment per unit.
 The managers of MF are obliged to redeem any units in issue on demand or
certain specified period.
 All dividend income that the MF receives on its investments is paid out to unit
holders.
 Since the unit held by investor evidences the ownership of the fund’s assets, the
value of an investors part ownership is determined by the NAV of the number of
units held.
At the end of 2020, mutual fund assets worldwide were $63.9 trillion, according to
the Investment Company Institute. The countries with the largest mutual fund
industries are:
1.United States: $26.7 trillion 8.Canada: $1.9 trillion
2.Australia: $5.3 trillion 9.United Kingdom: $1.9 trillion
3.Ireland: $3.4 trillion 10.China: $1.4 trillion
4.Germany: $2.5 trillion
5.Luxembourg: $2.2 trillion
6.France: $2.2 trillion
7.Japan: $2.1 trillion

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Value of assets of mutual funds in selected countries worldwide in 2021(in
trillion euros)
Assets Under Management (AUM) of Indian Mutual Fund Industry as on March 31,
2022 stood at ₹37,56,683 crore. The AUM of the Indian MF Industry has grown from
₹ 5.87 trillion as on March 31, 2012 to ₹37.57 trillion as on March 31, 2022 more than 6
fold increase in a span of 10 years. India is on 37th
position in MF assets worldwide.

Pranav Kr Singh
Page - 4
Concept of a Mutual Fund
A Mutual Fund is a trust that pools the savings of a number of investors who share
a common financial goal. The money thus collected is then invested in capital
market instruments such as shares, debentures and other securities. The income
earned through these investments and the capital appreciation realized is shared by
its unit holders in proportion to the number of units owned by them. Thus a
Mutual Fund is the most suitable investment for the common man as it offers an
opportunity to invest in a diversified, professionally managed basket of securities
at a relatively low cost. The flow chart below describes broadly the working of a
mutual fund:-
Savings form an important part of the economy of any nation. With savings
invested in various options available to the people, the money acts as the driver for
growth of the country. Indian financial scene too presents multiple avenues to the
investors. Though certainly not the best or deepest of markets in the world, it has
ignited the growth rate in mutual fund industry to provide reasonable options for
an ordinary man to invest his savings.
Investment goals vary from person to person. While somebody wants security,
others might give more weightage to returns alone. Somebody else might want to
plan for his child’s education while somebody might be saving for the proverbial
rainy day or even life after retirement. With objectives defying any range, it is
obvious that the products required will vary as well.

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Page - 5
Investors earn from a Mutual Fund in three ways:
01.Income is earned from dividends declared by mutual fund schemes from time
to time.
02.If the fund sells securities that have increased in price, the fund has a capital
gain. This is reflected in the price of each unit. When investors sell these units at
prices higher than their purchase price, they stand to make a gain.
03.If fund holdings increase in price but are not sold by the fund manager, the
fund's unit price increases. You can then sell your mutual fund units for a profit.
This is tantamount to a valuation gain.
Though still at a nascent stage, Indian MF industry offers a plethora of schemes
and serves broadly all type of investors. The range of products includes equity
funds, debt, liquid, gilt and
balanced funds. There are also funds meant exclusively for young and old, small
and large investors. Moreover, the setup of a legal structure, which has enough
teeth to safeguard investors’ interest, ensures that the investors are not cheated out
of their hard-earned money. All in all, benefits provided by them cut across the
boundaries of investor category and thus create for them, a universal appeal.
Investors of all categories could choose to invest on their own in multiple options
but opt for mutual funds for the sole reason that all benefits come in a package.

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1.2 Introduction To Mutual Funds History
A mutual fund is a trust or a pool of investments by investors who share a
common financial goal. This pool is invested in several financial instruments such
as shares, debt instruments, bonds etc. by the company managing that trust. This
company is called an Asset Management Company. Returns so generated are later
distributed among the members of the pool in the ratio of their investments. The
AMC invests its money in a manner that while the returns are maximized, the risks
are kept to a minimum level. In India, it is mandatory for every Asset Management
Firm to be registered with the Securities and Exchange Board of India (SEBI), a
body that regulates all securities instruments.
The first company that dealt in mutual funds was the Unit Trust of India. It was set
up in 1963 as a joint venture of the Reserve Bank of India and the Government of
India. The objective of the UTI was to guide small and uninformed investors who
wanted to buy shares and other financial products in larger firms. The UTI was a
monopoly in those days. One of its mutual fund products that ran for several years
was the Unit Scheme 1964.
The mutual fund industry in India has undergone at least 4 phases. Let us now
look at each phase in brief:
Mutual Funds History: Phase Of Inception (1964-87)
The first phase was marked by the setting up of the UTI. Though it was a
collaboration between the RBI and the Indian Government, the latter was soon
delinked from the day-to-day operations of the Unit Trust of India. In this phase,
the company was the sole operator in the Indian mutual fund industry. In 1971, the
UTI launched the Unit Linked Insurance Plan or the ULIP. From that year until
1986, UTI introduced several plans and played a very big role in introducing the
concept of mutual funds in India.

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When UTI was set up several years ago, the idea was to not just introduce the
concept of mutual funds in India; an associated idea was to set up a corpus for
nation-building as well. Therefore, to encourage the small Indian investor, the
government built in several income-tax rebates in the UTI schemes. Not
surprisingly, the investible corpus of UTI swelled from 600 crores in 1984 to
6,700 crores in 1988. Clearly, the time had come for the Indian mutual industry to
move into the next phase.
Mutual Funds History: Entry Of Public Sector (1987-1993)
By the end of 1988, the mutual fund industry had acquired its own identity. From
1987, many public sector banks had begun lobbying the government for starting
their own mutual fund arms. In November 1987, the first non-UTI Asset
Management Fund was set up by the State Bank of India. This AMC was quickly
followed by the creation of other AMCs by banks like Canara Bank, Indian Bank,
Life Insurance Corporation, General Insurance Corporation, and Punjab National
Bank.
This opening up of the mutual fund industry delivered the desired results. In 1993,
the cumulative corpus of all the AMCs went up to a whopping Rs. 44,000 crores.
Observers of this industry say that in the second phase, not only the base of the
industry increased but also it encouraged investors to spend a higher percentage of
their savings in mutual funds. It was evident that the mutual fund industry in India
was poised for higher growth.
Mutual Fund History: Entry Private Sector Phase (1993-1996)
In the period 1991-1996, the Government of India had realized the importance of
the liberalization of the Indian economy. Financial sector reforms were the need of
the hour. India needed private sector participation for the rebuilding of the
economy.

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Keeping this in mind, the government opened up the mutual fund industry for the
private players as well. The foreign players welcomed this move and entered the
Indian market in significant numbers. In this period, 11 private players –in
collaboration with foreign entities- launched their Asset Management Funds.
Some of the top AMCs in the private sector were:
• ICICI Prudential AMC- This Company is a joint venture between ICICI Bank of
India and Prudential Plc of UK. It manages a corpus of INR 2, 93,000 crores and
has an inventory of more than 1400 schemes.
• HDFC Mutual Fund- Launched in the 1990s, the HDFC Mutual Fund manages
more than 900 different kinds of funds.
• Kotak Mahindra Mutual Fund- This AMC has an asset base of more than Rs.
1,19,000 crores. It is a joint venture of Kotak Financial Services and the Mahindra
Group.
SEBI Interventions And Growth, And AMFI
As the mutual fund industry grew further in the 1990s, the AMCs and the
government felt that it was time for regulation and some control. Investors had to
be protected as well as a level playing ground had also to be laid down. A few
years ago, the Indian industry had suffered a lot because of bank scams and there
was a real threat that investors might lose their monies yet again.
Consequently, the government introduced the SEBI Regulation Act in 1996 which
laid down a set of fair and transparent rules for all the stakeholders. In 1999, the
Indian government declared that all mutual fund dividends would be exempt from
income tax. The idea behind this decision was to spur further growth in the mutual
fund industry.
Meanwhile, the mutual fund industry also realized the importance of self-
regulation. As a result, it set up an industry body- the Association of Mutual Funds
of India (AMFI). One of the goals of this body is investor education.

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Mutual Funds History: Phase Of Consolidation (February 2003 – April 2014)
In February 2003, the Unit Trust of India was split into two separate entities,
following the repeal of the original UTI Act of 1963. The two separated entities
were the UTI Mutual Fund (which is under the SEBI regulations for MFs) and the
Specified Undertaking of the Unit Trust of India (SUUTI). Following this
bifurcation of the former UTI and occurrence numerous mergers among different
private sector entities, the mutual fund industry took a step towards the phase of
consolidation.
After the global economic recession of 2009, the financial markets across the
globe were at an all-time low and Indian market was no exception to it. Majority
of investors who had put in their money during the peak time of the market had
suffered great losses. This severely shook the faith of investors in the MF products.
The Indian Mutual Fund industry struggled to recover from these hardships and
remodel itself over the next two years. The situation toughened up more with
SEBI abolishing the entry load and the lasting repercussions of the global
economic crisis. This scenario is evident from the sluggish rise in the overall
AUM of the Indian MF industry.

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Mutual Funds History: Phase Of Steady Development And Growth (Since
May 2014):
Recognizing the lack of penetration of mutual funds in India, especially in the tier
II and tier III cities, SEBI launched numerous progressive measures in September
2012. The idea behind these measures was to bring more transparency and security
for the interest of the stakeholders. This was SEBI’s idea to ‘re-energize’ the
Indian MF Industry and boost the overall penetration of mutual funds in India.
The measures bore fruit in the due course by countering the negative trend that
was set because of the global financial crisis. The situation improved considerably
after the new government took charge at the center.
Since May ’14, the Indian MF industry has experienced a consistent inflow and
rise in the overall AUM as well as the total number of investor accounts (portfolio).
Currently, all the Asset Management Companies in India manage a combined
worth of around Rs. 23 lac crore of assets. Though this number looks attractive,
we still have to go a long way in order to match the west.
It is estimated that Indians save approximately Rs. 20-30 lakh crore annually. The
Indian mutual fund industry can grow immensely if Indians started parking a
higher percentage of their savings in MFs. Observers say that Indians have begun
shifting a part of their savings from physical assets like gold and land to financial
instruments like bonds and silver. However, the AMFI and the government need to
encourage Indians even more for investments in mutual funds.

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1.3 Types of Mutual Funds
The most popular types of mutual funds in India are listed below:
Equity funds
Debt funds
Money market funds
Index funds
Balanced funds
Income funds
Fund of funds
Specialty funds
There are several other types of funds offered by the asset management companies
in the country. We have segregated the same based on structure, asset class,
investment objective, specialty, and risk, in the sections below.
Types of Mutual Funds based on structure
 Open-Ended Funds: These are funds in which units are open for purchase or
redemption through the year. All purchases/redemption of these fund units are
done at prevailing NAVs. Basically these funds will allow investors to keep
invest as long as they want. There are no limits on how much can be invested in
the fund. They also tend to be actively managed which means that there is a
fund manager who picks the places where investments will be made. These
funds also charge a fee which can be higher than passively managed funds
because of the active management. They are an ideal investment for those who
want investment along with liquidity because they are not bound to any specific
maturity periods. Which means that investors can withdraw their funds at any
time they want thus giving them the liquidity they need.

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 Close-Ended Funds: These are funds in which units can be purchased only
during the initial offer period. Units can be redeemed at a specified maturity
date. To provide for liquidity, these schemes are often listed for trade on a
stock exchange. Unlike open ended mutual funds, once the units or stocks are
bought, they cannot be sold back to the mutual fund, instead they need to be
sold through the stock market at the prevailing price of the shares.
 Interval Funds: These are funds that have the features of open-ended and
close-ended funds in that they are opened for repurchase of shares at different
intervals during the fund tenure. The fund management company offers to
repurchase units from existing unit holders during these intervals. If unit
holders wish to they can offload shares in favour of the fund.
Types of Mutual Funds based on asset class
Equity Funds: These are funds that invest in equity stocks/shares of companies.
These are considered high-risk funds but also tend to provide high returns. Equity
funds can include specialty funds like infrastructure, fast moving consumer goods
and banking to name a few. They are linked to the markets and tend to
 Debt Funds: These are funds that invest in debt instruments e.g. company
debentures, government bonds and other fixed income assets. They are
considered safe investments and provide fixed returns. These funds do not
deduct tax at source so if the earning from the investment is more than Rs.
10,000 then the investor is liable to pay the tax on it himself.
 Money Market Funds: These are funds that invest in liquid instruments e.g.
T-Bills, CPs etc. They are considered safe investments for those looking to
park surplus funds for immediate but moderate returns. Money markets are
also referred to as cash markets and come with risks in terms of interest risk,
reinvestment risk and credit risks.

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 Balanced or Hybrid Funds: These are funds that invest in a mix of asset
classes. In some cases, the proportion of equity is higher than debt while in
others it is the other way round. Risk and returns are balanced out this way.
An example of a hybrid fund would be Franklin India Balanced Fund-DP (G)
because in this fund, 65% to 80% of the investment is made in equities and
the remaining 20% to 35% is invested in the debt market. This is so because
the debt markets offer a lower risk than the equity market.
Types of Mutual Funds based on investment objective
 Growth funds: Under these schemes, money is invested primarily in equity
stocks with the purpose of providing capital appreciation. They are considered
to be risky funds ideal for investors with a long-term investment timeline.
Since they are risky funds they are also ideal for those who are looking for
higher returns on their investments.
 Income funds: Under these schemes, money is invested primarily in fixed-
income instruments e.g. bonds, debentures etc. with the purpose of providing
capital protection and regular income to investors.
 Liquid funds: Under these schemes, money is invested primarily in short-
term or very short-term instruments e.g. T-Bills, CPs etc. with the purpose of
providing liquidity. They are considered to be low on risk with moderate
returns and are ideal for investors with short-term investment timelines.
 Tax-Saving Funds (ELSS): These are funds that invest primarily in equity
shares. Investments made in these funds qualify for deductions under the
Income Tax Act. They are considered high on risk but also offer high returns
if the fund performs well.
 Capital Protection Funds: These are funds where funds are are split between
investment in fixed income instruments and equity markets. This is done to
ensure protection of the principal that has been invested.

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 Fixed Maturity Funds: Fixed maturity funds are those in which the assets are
invested in debt and money market instruments where the maturity date is
either the same as that of the fund or earlier than it.
 Pension Funds: Pension funds are mutual funds that are invested in with a
really long term goal in mind. They are primarily meant to provide regular
returns around the time that the investor is ready to retire. The investments in
such a fund may be split between equities and debt markets where equities act
as the risky part of the investment providing higher return and debt markets
balance the risk and provide lower but steady returns. The returns from these
funds can be taken in lump sums, as a pension or a combination of the two.
Types of Mutual Funds based on specialty
 Sector Funds: These are funds that invest in a particular sector of the market
e.g. Infrastructure funds invest only in those instruments or companies that
relate to the infrastructure sector. Returns are tied to the performance of the
chosen sector. The risk involved in these schemes depends on the nature of
the sector.
 Index Funds: These are funds that invest in instruments that represent a
particular index on an exchange so as to mirror the movement and returns of
the index e.g. buying shares representative of the BSE Sensex.
 Fund of funds: These are funds that invest in other mutual funds and returns
depend on the performance of the target fund. These funds can also be
referred to as multi manager funds. These investments can be considered
relatively safe because the funds that investors invest in actually hold other
funds under them thereby adjusting for risk from any one fund.
 Emerging market funds: These are funds where investments are made in
developing countries that show good prospects for the future. They do come
with higher risks as a result of the dynamic political and economic situations
prevailing in the country.

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 International funds: These are also known as foreign funds and offer
investments in companies located in other parts of the world. These
companies could also be located in emerging economies. The only companies
that won’t be invested in will be those located in the investor’s own country.
 Global funds: These are funds where the investment made by the fund can be
in a company in any part of the world. They are different from
international/foreign funds because in global funds, investments can be made
even the investor's own country.
 Real estate funds: These are the funds that invest in companies that operate in
the real estate sectors. These funds can invest in realtors, builders, property
management companies and even in companies providing loans. The
investment in the real estate can be made at any stage, including projects that
are in the planning phase, partially completed and are actually completed.
 Commodity focused stock funds: These funds don’t invest directly in the
commodities. They invest in companies that are working in the commodities
market, such as mining companies or producers of commodities. These funds
can, at times, perform the same way the commodity is as a result of their
association with their production.
 Market neutral funds: The reason that these funds are called market neutral
is that they don’t invest in the markets directly. They invest in treasury bills,
ETFs and securities and try to target a fixed and steady growth.
 Inverse/leveraged funds: These are funds that operate unlike traditional
mutual funds. The earnings from these funds happen when the markets fall
and when markets do well these funds tend to go into loss. These are
generally meant only for those who are willing to incur massive losses but at
the same time can provide huge returns as well, as a result of the higher risk
they carry.

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 Asset allocation funds: The asset allocation fund comes in two variants, the
target date fund and the target allocation funds. In these funds, the portfolio
managers can adjust the allocated assets to achieve results. These funds split
the invested amounts and invest it in various instruments like bonds and
equity.
 Gilt Funds: Gilt funds are mutual funds where the funds are invested in
government securities for a long term. Since they are invested in government
securities, they are virtually risk free and can be the ideal investment to those
who don’t want to take risks.
 Exchange traded funds: These are funds that are a mix of both open and
close ended mutual funds and are traded on the stock markets. These funds
are not actively managed, they are managed passively and can offer a lot of
liquidity. As a result of their being managed passively, they tend to have
lower service charges (entry/exit load) associated with them.
Types of Mutual Funds based on risk
 Low risk: These are the mutual funds where the investments made are by
those who do not want to take a risk with their money. The investment in such
cases are made in places like the debt market and tend to be long term
investments. As a result of them being low risk, the returns on these
investments is also low. One example of a low risk fund would be gilt funds
where investments are made in government securities.
 Medium risk: These are the investments that come with a medium amount of
risk to the investor. They are ideal for those who are willing to take some risk
with the investment and tends to offer higher returns. These funds can be used
as an investment to build wealth over a longer period of time.

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 High risk: These are those mutual funds that are ideal for those who are
willing to take higher risks with their money and are looking to build their
wealth. One example of high risk funds would be inverse mutual funds. Even
though the risks are high with these funds, they also offer higher returns.
How to choose the right mutual fund
With so many different types of mutual funds available in the market, picking one
that suits specific investment needs the most is not an easy task. The simplest
advice that can be given in that regard is to first understand your own needs. The
next step would be to figure out what your goal is? Is it to build wealth quickly, at
a moderate pace or at a slow pace. Once that is decided the last main thing to
consider is the risk you are willing to take. The highest returns are general
observed to come from the funds offering the highest risks. So if you want returns
quickly and are willing to take risks than that is the fund to go for. If your
objective is to build wealth slowly then going in for a medium or low risk mutual
fund is ideal.
Since mutual funds always come with a factor of risk associated with them, no
matter how small, it is imperative that investors read their policy documents
carefully before investing. It would also be a good idea to read the document to
ensure that they, the investors, have understood exactly what they have invested
in and all the facilities that are available to them with that investment.

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1.4 Conceptual Framework of Mutual Fund
A mutual fund is constituted as a public trust created under the Indian Trust Act,
1882. SEBI (mutual fund) regulations, 1996 regulate the structure of the mutual
funds in India. As per these regulations should have the following three-tier
structure:
Sponsor
ii) Trust/trustee
iii) Asset Management Company
Apart from this mutual fund consist of
 Sponsor
Sponsor is the person who acting alone or in combination with another body
corporate establishes a mutual fund. The sponsor establishes the mutual fund and
registers the same with SEBI. Sponsor appoints the Trustees, custodians and the
AMC with prior approval of SEBI and in accordance with SEBI Regulations.

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Sponsor must have a 5-year track record of business interest in the financial
markets. Sponsor must have been profit making in at least 3 of the above 5 years.
Sponsor must contribute at least 40% of the net worth of the Investment Managed
and meet the eligibility criteria prescribed under the Securities and Exchange
Board of India (Mutual Funds) Regulations, 1996.The Sponsor is not responsible
or liable for any loss or shortfall resulting from the operation of the Schemes
beyond the initial contribution made by it towards setting up of the Mutual Fund.
 Trust
The Mutual Fund is constituted as a trust in accordance with the provisions of the
Indian Trusts Act, 1882 by the Sponsor. The trust deed is registered under the
Indian Registration Act, 1908.
 Trustee
Trustee is usually a company (corporate body) or a Board of Trustees (body of
individuals). The main responsibility of the Trustee is to safeguard the interest of
the unit holders and inter aliance ensure that the AMC functions in the interest of
investors and in accordance with the Securities and Exchange Board of India
(Mutual Funds) Regulations, 1996, the provisions of the Trust Deed and the Offer
Documents of the respective Schemes. At least 2/3rd directors of the Trustee are
independent directors who are not associated with the Sponsor in any manner.
 Asset Management Company (AMC)
The AMC is appointed by the Trustee as the Investment Manager of the Mutual
Fund. The AMC is required to be approved by the Securities and Exchange Board
of India (SEBI) to act as an asset management company of the Mutual Fund. At
least 50% of the directors of the AMC are independent directors who are not
associated with the Sponsor in any manner. The AMC must have a net worth of at
least 10 crore at all times.

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 Registrar and Transfer Agent
The AMC if so authorized by the Trust Deed appoints the Registrar and Transfer
Agent to the Mutual Fund. The Registrar processes the application form,
redemption requests and dispatches account statements to the unit holders. The
Registrar and Transfer agent also handles communications with investors and
updates investor records.
 Custodian
A custodian is an agent, bank, trust company, or other organization which holds
and safeguards an individual's, mutual funds, or investment company's assets for
them.
1.5 Features & Advantages of Mutual Funds
1. Professional Management
Mutual Funds provide the services of experienced and skilled professionals,
backed by a dedicated investment research team that analyses the performance and
prospects of companies and selects suitable investments to achieve the objectives
of the scheme. This risk of default by any company that one has chosen to invest
in, can be minimized by investing in mutual funds as the fund managers analyze
the companies’ financials more minutely than an individual can do as they have
the expertise to do so. They can manage the maturity of their portfolio by
investing in instruments of varied maturity profiles.
2. Diversification
Mutual Funds invest in a number of companies across a broad cross-section of
industries and sectors. This diversification reduces the risk because seldom do all
stocks decline at the same time and in the same proportion. You achieve this
diversification through a Mutual Fund with far less money than you can do on
your own.

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3. Convenient Administration
Investing in a Mutual Fund reduces paperwork and helps you avoid many
problems such as bad deliveries, delayed payments and follow up with brokers and
companies. Mutual Funds save your time and make investing easy and convenient.
4. Return Potential
Over a medium to long-term, Mutual Funds have the potential to provide a higher
return as they invest in a diversified basket of selected securities. Apart from
liquidity, these funds have also provided very good post-tax returns on year to year
basis. Even historically, we find that some of the debt funds have generated
superior returns at relatively low level of risks. On an average debt funds have
posted returns over 10 percent over one-year horizon. The best performing funds
have given returns of around 14 percent in the last one-year period. In nutshell we
can say that these funds have delivered more than what one expects of debt
avenues such as post office schemes or bank fixed deposits. Though they are
charged with a dividend distribution tax on dividend payout at 12.5 percent (plus a
surcharge of 10 percent), the net income received is still tax free in the hands of
investor and is generally much more than all other avenues, on a post-tax basis.
5. Low Costs
Mutual Funds are a relatively less expensive way to invest compared to directly
investing in the capital markets because the benefits of scale in brokerage,
custodial and other fees translate into lower costs for investors.

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6. Liquidity
In open-end schemes, the investor gets the money back promptly at net asset value
related prices from the Mutual Fund. In closed-end schemes, the units can be sold
on a stock exchange at the prevailing market price or the investor can avail of the
facility of direct repurchase at NAV related prices by the Mutual Fund. Since there
is no penalty on pre-mature withdrawal, as in the cases of fixed deposits, debt
funds provide enough liquidity. Moreover, mutual funds are better placed to
absorb the fluctuations in the prices of the securities as a result of interest rate
variation and one can benefits from any such price movement.
7. Transparency
Investors get regular information on the value of your investment in addition to
disclosure on the specific investments made by your scheme, the proportion
invested in each class of assets and the fund manager's investment strategy and
outlook.
8. Flexibility
Through features such as regular investment plans, regular withdrawal plans and
dividend reinvestment plans; you can systematically invest or withdraw funds
according to your needs and convenience.
9. Affordability
A single person cannot invest in multiple high-priced stocks for the sole reason
that his pockets are not likely to be deep enough. This limits him from diversifying
his portfolio as well as benefiting from multiple investments. Here again, investing
through MF route enables an investor to invest in many good stocks and reap

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benefits even through a small investment. Investors individually may lack
sufficient funds to invest in high-grade stocks. A mutual fund because of its large
corpus allows even a small investor to take the benefit of its investment strategy.
10. Choice of Schemes
Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.
11. Well Regulated
All Mutual Funds are registered with SEBI and they function within the provisions
of strict regulations designed to protect the interests of investors. The operations of
Mutual Funds are regularly monitored by SEBI.
12. Tax Benefits
Last but not the least, mutual funds offer significant tax advantages. Dividends
distributed by them are tax-free in the hands of the investor. They also give you
the advantages of capital gains taxation. If you hold units beyond one year, you get
the benefits of indexation. Simply put, indexation benefits increase your purchase
cost by a certain portion, depending upon the yearly cost-inflation index (which is
calculated to account for rising inflation), thereby reducing the gap between your
actual purchase cost and selling price. This reduces your tax liability. What’s more,
tax-saving schemes and pension schemes give you the added advantage of benefits
under Section 88. You can avail of a 20 per cent tax exemption on an investment
of up to Rs 10,000 in the scheme in a year.

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1.6 Drawbacks of mutual funds
Mutual funds are good investment vehicles to navigate the complex and
unpredictable world of investments. However, even mutual funds have some
inherent drawbacks. Understand these before you commit your money to a mutual
fund.
1. No assured returns and no protection of capital
If you are planning to go with a mutual fund, this must be your mantra: mutual
funds do not offer assured returns and carry risk. For instance, unlike bank
deposits, your investment in a mutual fund can fall in value. In addition, mutual
funds are not insured or guaranteed by any government body (unlike a bank
deposit, where up to Rs 1 lakh per bank is insured by the Deposit and Credit
Insurance Corporation, a subsidiary of the Reserve Bank of India). There are strict
norms for any fund that assures returns and it is now compulsory for funds to
establish that they have resources to back such assurances. This is because most
closed-end funds that assured returns in the early-nineties failed to stick to their
assurances made at the time of launch, resulting in losses to investors. A scheme
cannot make any guarantee of return, without stating the name of the guarantor,
and disclosing the net worth of the guarantor. The past performance of the assured
return schemes should also be given.
2. Restrictive gains
Diversification helps, if risk minimization is your objective. However, the lack of
investment focus also means you gain less than if you had invested directly in a
single security. Assume, Reliance appreciated 50 per cent. A direct investment in
the stock would appreciate by 50 per cent. But your investment in the mutual fund,
which had invested 10 per cent of its corpus in Reliance, will see only a 5 per cent
appreciation.

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3. Taxes
During a typical year, most actively managed mutual funds sell anywhere from 20
to 70 percent of the securities in their portfolios. If your fund makes a profit on its
sales, you will pay taxes on the income you receive, even if you reinvest the
money you made.
4. Management risk
When you invest in a mutual fund, you depend on the fund's manager to make the
right decisions regarding the fund's portfolio. If the manager does not perform as
well as you had hoped, you might not make as much money on your investment as
you expected. Of course, if you invest in Index Funds, you forego management
risk, because these funds do not employ managers.
1.7 Tax Benefits of Investing in Mutual Funds
Tax on equity mutual funds (funds which have at least 65% equity allocation in
their investment portfolios). The minimum holding period for long term capital
gains in equity funds is one year. Short term capital gains (if the units are sold
before one year) in equity funds are taxed at the rate of 15% plus 4% cess. Long
term capital gains tax in equity funds is 10% + 4% cess provided the gain in a
financial year is over Rs 1 Lakh. Long term capital gains upto Rs 1 Lakh is totally
tax free.
Dividends paid by equity mutual funds are tax free in the hands of the investor but
the AMC pays dividend distribution tax (DDT) at the rate of 11.648%.
Tax on debt mutual funds - The minimum holding period for short term capital
gains in debt funds is 3 years. Short term capital gains (if the units are sold before

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three years) in debt mutual funds are taxed as per applicable tax rate of the
investor. Therefore, if your tax rate is 30% then short term capital gains tax on
debt fund is 30% + 4% cess. Long term capital gains of debt fund are taxed at 20%
with indexation. To calculate capital gains with indexation, you should index your
purchasing cost by multiplying the purchasing cost with the ratio of the cost of
inflation index of the year of sale and cost of inflation index of the year of
purchase, and then subtract the indexed purchasing cost from sales value.
Indexation benefits reduce the tax obligation of debt fund investor considerably
compared to investments in bank FDs and many small savings schemes.
While dividends are tax free in the hands of the investor, the fund house pays
dividend distribution tax (DDT) at the rate of 29.120% for debt mutual funds
before distributing dividends to investors.
The table below summarizes the taxation of equity and debt mutual funds

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1.8 Regulation of Mutual Funds in India
 The term “regulation” means a rule or directive made and controlled by an
authority.
 Mutual funds are regulated by the Securities and Exchange Board of
India (SEBI).
 In 1996, SEBI formulated the Mutual Fund Regulation.
 SEBI is additionally the apex regulator of capital markets and its
intermediaries.
 The issuance and trading of capital market instruments also come under the
purview of SEBI.
 Along with SEBI, mutual funds are regulated by RBI, Companies Act, Stock
exchange, Indian Trust Act and Ministry of Finance.
 RBI acts as a regulator of Sponsors of bank-sponsored mutual funds, especially
in the case of funds offering guaranteed returns.
 In order to provide a guaranteed returns scheme, a mutual fund needs to take
approval from RBI.
 The Ministry of Finance acts as a supervisor of RBI and SEBI and appellate
authority under SEBI regulations.
 Mutual funds can appeal to the Ministry of finance on the SEBI rulings.
Who regulates mutual funds in India
 Primarily, mutual funds are regulated by the Securities and Exchange Board of
India (SEBI).
 A mutual fund should have the approval of RBI in order to provide a
guaranteed returns scheme.
 The Ministry of Finance acts as a supervisor of RBI and SEBI and appellate
authority under SEBI regulations.

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 The Association of Mutual Funds in India (AMFI) has been made to develop
this Mutual Fund Industry of India on professional and ethical lines and to
enhance and maintain standards in all areas with a view to protect and promote
the interests of mutual funds and their unit holders.
1.9 Various types of Mutual Fund schemes exist to cater to
different needs of different people. Largely there are three types of
mutual funds:
01.Equity or Growth Funds
A stock fund, or equity fund, is a fund that invests in stocks, also called equity
securities. Stock funds can be contrasted with bond funds and money funds. Fund
assets are typically mainly in stock, with some amount of cash, which is generally
quite small, as opposed to bonds, notes, or other securities. This may be a mutual
fund or exchange-traded fund. The objective of an equity fund is long-term growth
through capital gains, although historically dividends have also been an important
source of total return. Specific equity funds may focus on a certain sector of the
market or may be geared toward a certain level of risk.
Stock funds can be distinguished by several properties. Funds may have a specific
style, for example, value or growth. Funds may invest in solely the securities from
one country, or from many countries. Funds may focus on some size of company,
that is, small-cap, large-cap, et cetera. Funds which involve some component of
stock picking are said to be actively managed, whereas index funds try as well as
possible to mirror specific stock market indices.

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02.Hybrid Funds
A hybrid fund is an investment fund that is characterized by diversification among
two or more asset classes. These funds typically invest in a mix ofstocks and
bonds. They may also be known as asset allocationfunds.
A hybrid fund is a classification of mutual fund or ETF that invests in different
types of assets or asset classes to produce a diversified portfolio.
Balanced funds, which hold typically 60% stocks and 40% bonds are a common
example of a hybrid fund.
Blended funds, which mix growth and value stocks, are another hybrid
03.Debt Funds
Debt is the major markets in which people invest their hard-earned money to make
profits. The debt market consists of various instruments which facilitate the buying
and selling of loans in exchange for interest. Considered to be less risky than
equity investments, many investors with a lower risk tolerance prefer buying in
debt securities. However, debt investments offer lower returns as compared to
equity investments. Here, we will explore Debt Funds and talk about different
types of debt funds along with their benefits and a lot more.
Debt funds invest in securities which generate fixed income like treasury bills,
corporate bonds, commercial papers, government securities, and manyother
moneymarket instruments. All these instruments have a pre-decided maturity date
and interest rate that the buyer can earn on maturity – hence the name fixed-
income securities. The returns are usually not affected by fluctuations in the
market. Therefore, debt securities are considered to be low-risk investment options.

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1.10 MUTUAL FUND INVESTMENT STRATIGIES
1. Systematic Investment Plan (SIP):
SIPs entail an investor to invest a fixed sum of money at regular intervals in MF
scheme the investor has chosen. This may help you gain from any appreciation in
the event of upside or alternatively, average your cost duringdownside. Seeingthe
present volatility in the market SIPis the best option available to the investor due
to regular entry into the market which causes rupee cost averaging and hence
covers the volatility.
2. Systematic Withdrawal Plan (SWPs):
These plans are best suited for people nearing retirement. In these plans investor
invest in a mutual fund scheme and is allowed to withdraw a fixed sum of money
at regular intervals to take care of expenses.
3. Systematic Transfer Plan (STP):
They allow the investor to transfer on a periodic basis a specified amount from one
scheme to another with in the same fund family meaning two schemes belonging
to the same mutual fund. A transfer will be treated as redemption of units from the
scheme from which the transfer is made.

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1.11 HOW TO INVEST IN MUTUAL FUNDS
Step One- Identify your investment needs. Your financial goals will vary, based
on your age, lifestyle, financial independence, family commitments, level of
income and expenses among many other factors. Therefore, the first step is to
assess your needs.
Step Two- Choose the right Mutual Fund. Once you have a clear strategy in mind,
you now have to choose which Mutual Fund and scheme you want to invest in.
The offer document of the scheme tells you its objectives and provides
supplementary details like the track record of other schemes managed by the same
Fund Manager. Some factors to evaluate before choosing a particular Mutual Fund
are:
 The track record of performance over the last few years in relation to the
appropriate yardstick and similar funds in the same category.
 How well the Mutual Fund is organized to provide efficient, prompt and
personalized service.
 Degree of transparency as reflected in frequency and quality of their
communications.
Step Three- Select the ideal mix of Schemes.
Investing in just one Mutual Fund scheme may not meet all your investment needs.
You may consider investing in a combination of schemes to achieve your specific
goals.

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The following charts could prove useful in selecting a combination of schemes
that satisfy your needs.
Figure
This plan may suit
 Investor seeking Income & moderate growth.
 Investor looking for growth & stability with moderate risk
Figure

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Step Four - Invest regularly.
Step Five- Keep your taxes in mind
Step Six- Start early It is desirable to start investing early and stick to a regular
investment plan. If you start now, you will make more than if you wait and invest
later. The power of compounding lets you earn income on income and your money
multiplies at a compounded rate of return.
Step Seven-The final step all you need to do now is to get in touch with a Mutual
Fund or your Agent/broker and start investing. Reap the rewards in the years to
come. Mutual Funds are suitable for every kind of investor-whether starting a
career or retiring, conservative or risk taking, growth oriented or income seeking.
What fees and commissions will you pay when you invest in mutual funds?
The fees and commissions you may be charged can vary widely from one fund,
and one dealer, to the next. Some of the charges may be negotiable, but you should
make sure that you understand all of the costs before you invest. There are two
main costs to consider – the management and operating expenses that are charged
to the fund each year, and the sales charges (or loads) that you pay when you buy
or sell the fund.

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Management and Operating Expenses are expenses paid each year by the fund and
include such things as the manager’s fees, legal and accounting fees, custodial fees
and bookkeeping costs. The Management Expense Ratio (MER) is the percentage
of the fund’s average net assets that these expenses represent. For example, if a
$100 million fund has $2 million in costs for the year its MER will be 2%. MERs
can range from under 1% per year for some money market funds to almost 3% for
some equity funds. The higher the MER, the greater the impact on the fund’s
performance and the return to its investors because these expenses are removed
before the value is reported.

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DIFFERENT AVENUES OF INVESTMENT
OPTIONS RETURN RISK LIQUIDITY
Savings account Very low Very low High
Fixed Deposits Low Low Low
Direct Equity Very high return Very high High
Insurance Medium Low Low
Company fixed
deposits Low High Very low
Debentures Low Medium Medium
Bonds Low Low Low
Mutual funds High Medium High
Post office schemes Low Low Low
Government
securities Low Low Low
Real estate High High Low
Currency High High High
Bullion Medium High Medium

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STATEMENT OF PROBLEM
Mutual Funds are Financial intermediaries concern with the mobilizing savings of
surplus income & channelisation of these savings in those avenues where there is
demand of funds.
The main purpose behind this study of investment preferences in Mutual Funds is
to see that how the investors are employing their resources in a manner to afford,
combine benefits to low risks, steady or consistent returns, high liquidity & capital
appreciation through diversification & Expert Management.
Therefore the activities of mutual funds have both short & long term impact on the
savings & capital market & the national economy. Mutual Funds, thus, assist the
process of financial depending & intermediation.
Objectives of the Study
 To study various investment alternatives and in particular investors preference
towards mutual funds.
 To study the preference of investors in today’s scenario (less risk and more
return).
 To assess the risk of investors with reference to diversifiable risk & non-
diversifiable risk.
 To study market potentiality of mutual fund among investors.
 To study whether the investors are considering IDFC a better option or not.

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Chapter – 2
RESEARCH METHODOLOGY

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Research Methodology
Research Methodology is a systematic method of discovering new facts or
verifying old facts, their sequence, inter-relationship, casual explanation and the
natural laws which governs them. In it we study the various steps that are generally
adopted by a researcher in the studying his research problem along with the logic
behind them.
Different stages involved in research consists of enacting the problem, formulating
a hypothesis, collecting the facts or data, analyzing the facts and reaching certain
conclusion either in the form of solution towards the concerned problem or in
generalization for some theoretical formulation.
Type of Sample Design: Judgment Sampling
Sample Size: 200
In Research Methodology mainly Data plays an important role.
The Data is divided in two parts:
a) Primary Data.
b) Secondary Data.
Primary Data is the data, which is collected directly by direct personal interview
with employees of branches, indirect oral investigation, Information received
through local agents.

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Secondary Data is the data, which is collected from:
 Various books.
 Magazine and material.
 Internet
 Fact sheets of various MFs
The data which is stored in the organization and provide by the FINANCE people
are also secondary data. The various information is taken out regarding that subject
as well other subject from various sources and stored. The last years data stored can
also be secondary data. This data is kept for the internal use of the organization.
The FINANCE manual is for the internal use of the organization they are secondary
data which help people to gain information. In this report the data plays a very
crucial role. For this report the data was provided to me by FINANCE department
and other departmental head in the organization.
SURVEY ANALYSIS
Sampling Method
The sampling method so as to obtain a representative sample is the Non-
Probability Sampling methods. Under non-probability sampling, we selected the
respondents to the survey on the basis of Judgment sampling with Convenience
taken into account.
Research instrument
The research instrument used for this survey is a comparing different companies
data & analyzing them. also questionnaire with the different branch employees
contains both open-ended and close ended questions.

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Assumptions
 The sample selected represents the different branch employees overview.
 The data has been collected by administering an open and close ended
questionnaire to branch agents & data provided by them and with the
assumption that the primary data & secondary data collected is true and reflects
the actual preferences of the Mutual fund companies.
 The sample selected has thorough knowledge of the subject.
LIMITATIONS OF THE STUDY
1)Sometime stock market are not performing well so people are not interested to
invest
2) Sometime because of negative sentiments in the market people are not ready to
invest for e.g. the subprime crisis in US affected the stock market in India.
3) Many people have good knowledge of the equity market by themselves so they
don’t want to invest in mutual fund
4) Many are looking for the short term benefits for which sometime mutual fund is
not the best option
5) Many people who want to have high risk high return are not suitable for mutual
fund
6) Some people are not ready to invest in mutual fund because of the lack of
knowledge about the product
7) Most of the time people are busy in their schedule and so they don’t want to
listen to anything on the telephone calls.
8) In small towns people are not willing to purchase mutual fund because of lack
of knowledge they rather prefer to invest in real state
9) It is also difficult to measure economic factor associated with time constrain
10) Time constrain

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Chapter – 3
LITERATURE REVIEW

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LITERATURE REVIEW
Literature on mutual fund performance evaluation is enormous. A few research
studies that have influenced the preparation of this paper substantially are discussed
in this section.
Sharpe, William F. (1966) suggested a measure for the evaluation of portfolio
performance. Drawing on results obtained in the field of portfolio analysis,
economist Jack L.Treynor has suggested a new predictor of mutual fund
performance, one that differs from virtually all those used previously by
incorporating the volatility of a fund's return in a simple yet meaningful manner.
Michael C. Jensen (1967) derived a risk-adjusted measure of portfolio performance
(Jensen’s alpha) that estimates how much a manager’s forecasting ability
contributes to fund’s returns.
As indicated by Statman (2000), the e SDAR of a fund portfolio is the excess return
of the portfolio overt he return of the benchmark index, where the portfolio is
leveraged to have the benchmark index’s standard deviation.
NarayanRao, ET. al., evaluated performance of Indian mutual funds in a bear
market through relative performance index, risk-return analysis, Treynor’s ratio,
Sharpe’s ratio, Sharpe’s measure , Jensen’s measure, and Fama’s measure. The
study used 269 open-ended schemes (out of total schemes of 433) for computing
relative performance index. Then after excluding funds whose returns are less than
risk-free returns, 58 schemes are finally used for further analysis. The results of
performance measures suggest that most of mutual fund schemes in the sample of
58 were able to satisfy investor’s expectations by giving excess returns over
expected returns based on both premiums for systematic risk and total risk.

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Bijan Roy, ET. al., conducted an empirical study on conditional performance of
Indian mutual funds. This paper uses a technique called conditional performance
evaluation on a sample of eighty-nine Indian mutual fund schemes .This paper
measures the performance of various mutual funds with both unconditional and
conditional form of CAPM, Treynor- Mazuy model and Henriks son-Merton model.
The effect of incorporating lagged information variables into the evaluation of
mutual fund managers’ performance is examined in the Indian context. The results
suggest that the use of conditioning lagged information variables improves the
performance of mutual fund schemes, causing alphas to shift towards right and
reducing the number of negative timing coefficients.
Mishra, ET al., (2002) measured mutual fund performance using lower partial
moment. In this paper, measures of evaluating portfolio performance based on
lower partial moment are developed.
Risk from the lower partial moment is measured by taking into account only those
states in which return is below a pre-specified “target rate” like risk-free rate.
Kshama Fernandes (2003) evaluated index fund implementation in India. In this
paper, tracking error of index funds in India is measured .The consistency and level
of tracking errors obtained by some well-run index fund suggests that it is possible
to attain low levels of tracking error under Indian conditions. At the same time,
there do seem to be periods where certain index funds appear to depart from the
discipline of indexation. K. Pendaraki ET al.studied construction of mutual fund
portfolios, developed a multi-criteria methodology and applied it to the Greek
market of equity mutual funds. The methodology is based on the combination of
discrete and continuous multi-criteria decision aid methods for mutual fund
selection and composition. UTADI Smulti-criteria decision aid method is employed
in order to develop mutual fund’s performance models.
Goal programming model is employed to determine proportion of selected mutual
funds in the final portfolios.

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Zakri Y.Bello (2005) matched a sample of socially responsible stock mutual funds
matched to randomly select conventional funds of similar net assets to investigate
differences in characteristics of assets held, degree of portfolio diversification and
variable effects of diversification on investment performance. The study found that
socially responsible funds do not differ significantly from conventional funds in
terms of any of these attributes. Moreover, the effect of diversification on
investment performance is not different between the two groups. Both groups under
performed the Domini 400 Social Index and S & P 500 during the study period.
Michael C. Jensen (1967) derived a risk-adjusted measure of portfolio
performance
(Jensen’s alpha) that estimates how much a manager’s forecasting ability
contributes to fund’s returns.
As indicated by Statman (2000), the e SDAR of a fund portfolio is the excess return
of the portfolio over the return of the benchmark index, where the portfolio is
leveraged to have the benchmark index’s standard deviation. S.Narayan Rao, ET.
al., evaluated performance of Indian mutual funds in a bear market through relative
performance index, risk-return analysis, Treynor’s ratio, Sharpe’s ratio, Sharpe’s
measure , Jensen’s measure, and Fama’s measure. The study used 269 open-ended
schemes (out of total schemes of 433) for computing relative performance index.
Then after excluding funds whose returns are less than risk-free returns, 58 schemes
are finally used for further analysis. The results of performance measures suggest
that most of mutual fund schemes in the sample of 58 were able to satisfy investor’s
expectations by giving excess returns over expected returns based on both
premiums for systematic risk and total risk.

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DEFNITION OF MUTUAL FUNDS
DEFNITION 1:
A mutual fund, also referred to as an open-end fund, is an investment company that
spreads its money across a diversified portfolio of securities -- including stocks,
bonds, or money market instruments.
Shareholders who invest in a fund each own a representative portion of those
investments, less any expenses charged by the fund.
Mutual fund investors make money either by receiving dividends and interest from
their investments, or by the rise in value of the securities. Dividends, interest and
profits from the sale of any securities (capital gains) are passed on to the
shareholders in the form of distributions. And shareholders generally are allowed to
sell (redeem) their shares at any time for the closing market price of the fund on
that day.
DEFNITION 2:
Mutual funds have been around for a long time, dating back to the early 19th
century. The first modern American mutual fund opened in 1924, yet it was only in
the 1990’s that mutual funds became mainstream investments, as the number of
households owning them nearly tripled during that decade. With recent surveys
showing that over 88% of all investors participate in mutual funds, you're probably
already familiar with these investments, or perhaps even own some. In any case, it's
important that you know exactly how these investments work and how you can use
them to your advantage.
A mutual fund is a special type of company that pools together money from many
investors and invests it on behalf of the group, in accordance with a stated set of
objectives. Mutual funds raise the money by selling shares of the fund to the public,

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much like any other company can sell stock in itself to the public. Funds then take
the money they receive from the sale of their shares (along with any money made
from previous investments) and use it to purchase various investment vehicles, such
as stocks, bonds and money market instruments. In return for the money they give
to the fund when purchasing shares, shareholders receive an equity position in the
fund and, in effect, in each of its underlying securities. For most mutual funds,
shareholders are free to sell their shares at any time, although the price of a share in
a mutual fund will fluctuate daily, depending upon the performance of the securities
held by the fund.
DEFNITION 3:
A mutual fund is simply a financial intermediary that allows a group of investors to
pool their money together with a predetermined investment objective. The mutual
fund wil have a fund manager who is responsible for investing the pooled money
into specific securities (usually stocks or bonds). When you invest in a mutual fund,
you are buying shares (or portions) of the mutual fund and become a shareholder of
the fund.
DEFNITION 4:
A security that gives small investors access to a well-diversified portfolio of
equities, bonds and other securities. Each shareholder participates in the gain or
loss of the fund. Shares are issued and can be redeemed as needed.

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How to Calculate the value of a Mutual Fund:
The investor’s funds are deployed in a portfolio of securities by the fund manager.
The value of these investments keeps changing as the market price of the securities
change. Since investors are free to enter and exit the fund at any time, it is essential
that the market value of their investments is used to determine the price at which
such entry and exit will take place. The net assets represent the market value of
assets, which belong to the investors, on a given date.
Net Asset Value or NAV of a mutual fund is the value of one unit of investment in
the fund, in net asset terms.
NAV= Net Asset of the scheme / Number of Units Outstanding
Where Net Assets are calculated as:-
(Market value of investment + current assets and other assets + Accrued income –
current liabilities and other liabilities – less accrued expenses) / No. of Units
Outstanding as at the NAV date.
NAV of all schemes must be calculated and published at least weekly for closed –
end schemes and daily for open- end schemes.
The major factors affecting the NAV of a fund are :
 Sale and purchase of securities
 Sale and repurchase of units
 Valuation of assets
 Accrual of income and expenses

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. NAV-:
Net Asset Value is the market value of the assets of the scheme minus its
liabilities. The per unit NAV is the net asset value of the scheme divided by the
number of units outstanding on the Valuation Date.
How is NAV calculated?
The value of all the securities in the portfolio in calculated daily. From this,
all expenses are deducted and the resultant value divided by the number of units in
the fund is the fund’s NAV.
Expense Ratio
AMCs charge an annual fee, or expense ratio that covers administrative
expenses, salaries, advertising expenses, brokerage fee, etc. A 1.5% expense ratio
means the AMC charges Rs1.50 for every Rs100 in assets under management.
A fund's expense ratio is typically to the size of the funds under
management and not to the returns earned. Normally, the costs of running a fund
grow slower than the growth in the fund size - so, the more assets in the fund, the
lower should be its expense.

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Entry load and an exit load
Some Asset Management Companies (AMCs) have sales charges, or
loads, on their funds (entry load and/or exit load) to compensate for distribution
costs. Funds that can be purchased without a sales charge are called no-load
funds. Entry load is charged at the time an investor purchases the units of a
scheme. The entry load percentage is added to the prevailing NAV at the time of
allotment of units. Exit load is charged at the time of redeeming (or transferring
an investment between schemes). The exit load percentage is deducted from the
NAV at the time of redemption (or transfer between schemes). This amount goes
to the Asset Management Company and not into the pool of funds of the scheme.
How does "entry load" affect the investment returns?
A 2.25% entry load sounds small. But it still bites a chunk off the returns over a
long period of time. For instance, Rs 1 lakh invested directly in the no-load option
of an equity fund that grows at a rate of 15% over a period of 20 years yields
around Rs 16.36 lakh against Rs 15.99 lakh that a load fund would return—a
difference of Rs 36,820. This is because even a small sum of 2.25% gets
compounded over the years.
The pinch remains the same even in a systematic investment plan (SIP). As SIPs
entail investments on a regular basis, say every month, you end up paying entry
loads on all your investment installments. Assume you had invested Rs 5,000 in
Reliance Vision Fund (RVF) on January 1, 2003 through a monthly SIP. If you
had withdrawn your entire investment after five years, on December 31, 2007,
you would have got back Rs 11.52 lakh in the no-load option and Rs 11.25 lakh in
a load option, a difference of a cool Rs 25,914.

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Are investments in mutual fund units risk-free or safe?
This depends on the underlying instrument that a mutual fund invests in, based on
its investment objectives. Mutual funds that invest in stock market-related
instruments cannot be termed “risk-free or safe” as investment in shares are
inherently risky by nature, whereas funds that invest in fixed-income instruments
are relatively safe and those that invest only in government securities are the safest.
Why Mutual Funds are an investment option?
Firstly, we are not all investment professionals. We go to a doctor when we need
medical advice or a lawyer for legal guidance, similarly mutual funds are
investment vehicles managed by professional fund managers. And unless you rate
highly on the Investment IQ Quiz, we recommend you use this option for
investing. Mutual funds are like professional money managers, however a key
factor in their favor is that they are more regulated and hence offer investors the
ability to analyze and evaluate their track record.
Secondly, investing is becoming more complex. There was a time when things
were quite simple - the market went up with the arrival of the first monsoon
showers and every year around Diwali. Since India started integrating with the
world (with the start of the liberalization process), complex factors such as an
increase in short-term US interest rates, the collapse of the Brazilian currency or
default on its debt by the Russian government, have started having an impact on
the Indian stock market. Although it is possible for an individual investor to
understand Indian companies (and investing) in such an environment, the process
can become fairly time consuming. Mutual funds (whose fund managers are paid
to understand these issues and whose asset management company invests in
research) provide an option of investing without getting lost in the complexities.

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Lastly, and most importantly, mutual funds provide risk diversification:
Diversification of a portfolio is amongst the primary tenets of portfolio structuring
(see The Need to Diversify). And a necessary one to reduce the level of risk
assumed by the portfolio holder. Most of us are not necessarily well qualified to
apply the theories of portfolio structuring to our holdings and hence would be
better off leaving that to a professional. Mutual funds represent one such option.
How to select a mutual fund scheme?
What's strategy got to do with selecting a mutual fund? Shouldn't you just go and
invest in the best performing fund? The answer is no. Mutual fund investing
requires as much strategic input as any other investment option. But the advantage
is that the strategy here is a natural extension of your asset allocation plan (use our
Asset Allocator to understand what your optimum asset allocation plan should be,
based on your personal risk profile). The following processes are important to
select a mutual fund scheme.
 Identify funds whose investment objectives match your asset allocation needs
Just as you would buy a computer that fits your needs and budget, you should
choose a mutual fund that meets your risk tolerance (need) and your risk
capacity (budget) levels (i.e. has similar investment objectives as your own).
Typical investment objectives of mutual funds include fixed income or equity,
general equity or sector-focused, high risk or low risk, blue-chips or
turnarounds, long-term or short-term liquidity focus. The investment objectives
match yours are
 Evaluate past performance, look for consistency. Although past performance is
no guarantee of future performance, it is a useful way of assessing how well or
badly a fund has performed in comparison to its stated objectives and peer
group. A good way to do this would be to identify the five best performing
funds (within your selected investment objectives) over various periods, say 3
months, 6 months, one year, two years and three years. Shortlist funds that
appear in the top 5 in each of these time horizons as they would have thus
demonstrated their ability to be not only good but also, consistent performers.

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Are investments in mutual fund units risk-free or safe?
This depends on the instrument mutual fund invests in, based on its investment
objectives. Mutual funds that invest in stock market-related instruments cannot
be termed “risk-free or safe” as investment in shares are inherently risky by
nature, whereas funds that invest in fixed-income instruments are relatively safe
and those that invest only in government securities are the safest.
Role of a Fund Manager:
Fund managers are responsible for implementing a consistent investment strategy
that reflects the goals and objectives of the fund. Normally, fund managers
monitor market and economic trends and analyze securities in order to make
informed investment decisions.
How are mutual funds regulated?
All Asset Management Companies (AMCs) are regulated by SEBI and or the RBI
(in case the AMC is promoted by a bank). In addition, every mutual fund has a
board of directors that represents the unit holders’ interests in the mutual fund.

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CONCLUSION OF MUTUAL FUNDS
Mutual funds are good source of returns for majority of households and it is
particularly useful for the people who are at the age of retirement. However,
average investors are still restricting their choices to conventional options like
gold and fixed deposits when the market is flooded with countless investment
opportunities, with mutual funds. This is because of lack of information about how
mutual funds work, which makes many investors hesitant towards mutual fund
investments. In fact, many a times, people investing in mutual funds too are
unclear about how they function and how one can manage them. So the
organizations which are offering mutual funds have to provide complete
information to the prospective investors relating to mutual funds. The government
also has to take some measures to encourage people to invest in mutual funds even
though it is offering schemes like Rajiv Gandhi Equity Savings Scheme to the
investors. It is believed that some of these measures could lift the morale of the
mutual fund industry which has been crippled for the last three years.

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Chapter – 4
COMPANY’S PROFILE

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COMPANY PROFILE
Established in 2000, IDFC AMC is one of India’s Top 10 asset managers with an
average AUM of over Rs. 1,20,000 crores as of December 2020, across over 60
Mutual Fund schemes. It has an experienced investment team with a deep on-the-
ground presence in over 46 cities, and investors across over 375+ cities and towns
in India. IDFC AMC is focused on helping savers become investors and create
wealth. To support this objective, the AMC offers a range of prudently constructed
investment products – across equities, fixed income and liquid alternatives
- that aim to provide performance consistent with their well-defined objectives.

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OVERVIEW
BACKGROUND
IDFC is the promoter of the IDFC Bank and is registered with Reserve Bank of
IDFC is the promoter of the IDFC Bank and is registered with Reserve Bank of
India as NBFC - Investments. Besides banking, it also has investments in diverse
businesses such as asset management both public markets and private markets,
Institutional.
investments under IDFC Financial Holding Company Limited (NOFHC). IDFC is
a holding company of the group. IDFC and IDFC Bank are two listed entities of
the group and the rest of the businesses are conducted through unlisted
subsidiaries.
CORPORATE MISSION
Our mission is to create long-term value for all our stakeholders by being a
dynamic and customer centric organization providing banking and other financial
services through our subsidiaries.
CORPORATE VISION
We aim to be the most respectable financial service provider that reaches out to
millions of people pan India through various subsidiaries we hold. We aspire to
live upto the expectations of our customers, our people, our investors and society
at large.
VALUES
Our core values are influenced by our past, tempered by our present and will shape
our future. They are the amalgm of what we are and what we want to be.

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Balance:
We stay balanced by being ambitious but grounded, risk taking yet careful. We not
only ideate but also execute.
Collaboration:
We collaborate by working together, proactively sharing information, ideas and
solutions.
Drive:
We are driven with high focus and energy to constantly delight customers.
Honesty:
We are honest, transparent to all stakeholders and deliver what we promise.
INVESTMENT OFFERINGS
Equity:
Our offerings are built on a fundamental, research-driven framework. Research
ideas are taking through our proprietary seven-factor investment framework that
guides stock selection. Each investment theme uses a unique combination of
weights within this overarching framework, making our portfolios truly distinct.
Risk is managed proactively and prudently through our portfolio construction and
review process, aswell as well as through independent, system-based ongoing
monitoring. We offer a diverse range of growth-oriented investment strategies
across market caps, and across themes such as infrastructure or consumption.

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Fixed Income:
Our fixed income investment strategies are backed by strong fundamental and
macro research, with a keen eye for quality and consistency. We offer products
across both front-end carry oriented strategies as well as actively managed long-
bond or sovereign funds.
Liquid Alternatives:
Our fund house offers AIF – Category III to both Indian and International
investors. Hedge funds, being offered by IDFC AMC under AIF – Category III,
are an asset class that aim to have lower correlation to traditional asset classes,
such as long only equities and fixed income and intend to improve an investor’s
overall return per unit of risk.
Investors can participate in the India growth story through diverse and complex
trading strategies that may leverage investments in listed and unlisted derivatives.
At IDFC AMC, we offer a ‘true-to-label’ alternative to both traditional equity and
fixed income funds under the IDFC India Equity Hedge (IEH) Fund umbrella. The
objective of the Alternative Fund is to add diversification and low correlation to
existing traditional investments. It is not meant to replace traditional investments,
but to add value to the overall asset allocation mix. Being an AIF Category III
offering, the fund has a minimum ₹1 crore investment requirement suitable for
Ultra High Net Worth Individuals, Family offices, Corporations and Institutions.

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Portfolio Management Services (PMS):
As part of our Portfolio Management Services (PMS) offering, IDFC AMC
launched in July 2017, a pioneering initiative in bringing Artificial Intelligence
and Machine Learning (ML) techniques in
equity fund management. The PMS is a focused portfolio of large and mid-
capitalised stocks from the S&P BSE 200 index stock universe combining ML
based investment process with Portfolio Manager expertise. Under the supervision
of an experienced Data Scientist, the ML driven product has the potential to
identify opportunities to generate additional alpha while minimising risk /
volatility of returns.

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BOARD OF DIRECTORS
Mr. Sunil Kakar – Chairman
Mr. Geoffroy Sartorius
Mr. Jamsheed Kanga
Mr. D. M. Sukthankar
Mr. Tara Sankar Bhattacharya
Mr. Sridar Venkatesan
Mr. Bharat Raut
HISTORY & TIMELINES
Our Group was born out of the need for a specialized financial intermediary for
infrastructure. Incorporated on January 30, 1997 in Chennai, our company was set
up on the recommendations of the 'Expert Group on Commercialization of
Infrastructure Projects' under the Chairmanship of Dr. Rakesh Mohan.
Since then, we have been a leading catalyst for providing private sector
infrastructure development in India. We focus on developing and leveraging our
knowledge base in the infrastructure space to devise and provide appropriate
financing solutions to our customers. Our strong capitalization reflects the crucial
role that we play in infrastructure development.
 In 1997
IDFC is founded on the recommendations of the 'Expert Group on
Commercialization of Infrastructure Projects' under the Chairmanship of Dr.
Rakesh Mohan. The group is conceptualized to channel private capital into
commercially viable projects.
AUDITORS
S.R. Batliboi & Co. LLP
Chartered Accountants
PRINCIPAL BANKER
Standard Chartered Bank

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 In 1999
Is notified as a Public Financial Institution under Section 4A of the Companies
Act.
 In 2000
Gets registered with SEBI as a merchant banker.
 In 2001
Gets registered with SEBI as a debenture trustee.
Sets up Infrastructure Development Corporation (Karnataka) Limited (iDeCK)
 In 2002
Sets up IDFC Private Equity as an investment manager for private equity funds.
Sets up Uttaranchal Infrastructure Development Company Limited (UDEC).
 In 2003
Successfully raises $200 million for the India Development Fund, the first
infrastructure-focused private equity fund.
 In 2005
Becomes a public company after listing its shares on NSE and BSE.

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 In 2006
Successfully raises $450 million for its second infrastructure - focused private
equity fund.
 In 2007
Raises Rs. 2,100 crore through QIP.
Sets up IDFC Project Equity Company Limited as a specialized project finance
entity focused on developing Indian infrastructure projects.
Establishes IDFC Projects to develop, implement, own and operate projects in
the infrastructure space In 2008
Successfully raises $930 million through the India Infrastructure Fund to invest
equity capital in infrastructure projects and $700 million in its third private equity
fund.
Enters into asset management by acquiring the AMC business of Standard
Chartered Bank in India.
Incorporates IDFC Capital(Singapore) Pte Limited, for an emerging markets
private equity fund- of-funds business.
 In 2009
The company's loan book crosses Rs. 20,000 crore with more than 200
infrastructure projects funded.
Establishes IDFC Foundation to focus on capacity building, policy advisory and
sustainability initiatives.
Becomes part of Nifty 50.

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 In 2010
Raises additional capital of Rs. 26,542 million through a Qualified Institution
Placement at Rs.168.25 per share and CCPS at a conversion price of Rs.176 per
share. Government shareholding reduces to 18%.
Classified as an Infrastructure Finance Company (IFC).
Raises Rs. 480 crore in the first tranche of its Long Term Infrastructure Bonds.
 In 2011
Certified as India's first "Green Data Centre".
IDFC opens an office in US.
Sets up IDFC Foundation as a Section 25 Company for all its developmental
work.
IDFC & Natixis Global Asset Management enter into a strategic partnership.
Raise USD 310 million of ECB's.
Starts "Partners Program".
 In 2012
IDFC Completes 15 years with over 1.5 million investors.
Launches "In Our Hands" an youth engagement initiative, to socialize the policy
advocacy work being done under the aegis of the India Infrastructure Report (IIR).
Releases a handbook titled "EVOLVING PERSPECTIVES IN THE
DEVELOPMENT OF INDIAN INFRASTRUCTURE", encompassing the policy
work done in the last 15 years.

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IDFC BUSINESS
 Alternative Asset Management
 Corporate Investment Banking
 Capacity Building Initiatives
 Community Engagement
 Foundation
 Government Advisory Services
 Financial Markets Groups
 Infrastructure
 Project Finance
 Private Equity
 Public Market Asset Management
 Policy Advocacy
 Mutual Fund
 Real Estate
 Securities
COMPANY’S STRUCTURE
Structure of the company consists of following entities:-
 Country head
 State head distribution channel

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 Cluster heads of investments
 Individual brokers
 Back office operation
 Sales team
State head looks after all the operation in Karnataka region like Bellary, Mysore
and other cities of Karnataka and coordinates with asset management companies
i.e. AMCs and reports to country head, and cluster heads of investments are
responsible for sales team and report to state head distribution channel and sales
people who directly interact with investors for the investments report to cluster
head investment. Sales team is supported by back office operations, like role of
back office operation.

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SWOT analysis of the company and its competitor
STRENGTH
 BRANDNAME
 KNOWN TO BE ETHICAL
 PRESENCE IN ALL OVER INDIA
 EXPERIENCED PEOPLE IN THE
COMPANY
 UNBIASNESS
WEAKNESS
 BRANCHASE OF COMPANY IS LESS
ONLY 27 IN INDIA.
 LACK OF MANPOWER
 NOT HAVING NECESSARY
INFRASTRUCTURE
OPPORTUNITY
 ZERO BASE
 LACK OF PROPER SERVICES
AVAILABLE IN THE MARKET
 ABSENCE OF LEADER IN THE
MARKET, IN DISTRIBUTION
( MUTUAL FUNDS)
 HUGE POTENTIAL OF MUTUAL
FUND MARKET
 GROWTH OF MUTUAL FUND
MARKET
 INCREASE IN INCOME LEVEL OF
PEOPLE
THREATS
 INDIVIDUAL BROKERS
 ITS COMPETITOR’S
PROMOTIOAL ACTIVITIES
 ITS COMPETITOR’NEW BUSINESS
PLANS
 ATTRITION
 LACK OF MANPOWER
 NOT HAVING NECESSARY
INFRASTRUCTURE

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Chapter – 5
A
COMPARATIVE ANALYSIS
OF
MUTUAL FUND

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AVERAGE ASSETS UNDER MANAGEMENT
Assets under management (AUM) is a financial term denoting the market value of
all the funds being managed by a financial institution (a mutual fund, hedge fund,
private equity firm, venture capital firm, or brokerage house) on behalf of its
clients, investors, partners, depositors, etc.
The average Assets under management of all Mutual funds in India for the quarter
Jul-13 to Sep-13 (in INR billion) is given below:
Sr No Mutual Fund Name Average AUM %
1 HDFC Mutual Fund 1,034.42 12.70%
2 Reliance Mutual Fund 952.28 11.69%
3 ICICI Prudential Mutual Fund 853.03 10.48%
4 Birla Sun Life Mutual Fund 773.44 9.50%
5 UTI Mutual Fund 700.57 8.60%
6 SBI Mutual Fund 595.58 7.31%
7 Franklin Templeton Mutual Fund 448.12 5.50%
8 IDFC Mutual Fund 396.65 4.87%
9 Kotak Mahindra Mutual Fund 352.99 4.34%
10 DSP BlackRock Mutual Fund 304.86 3.74%
11 Tata Mutual Fund 179.66 2.21%
12 Deutsche Mutual Fund 170.59 2.10%
13 L&T Mutual Fund 150.79 1.85%
14 Sundaram Mutual Fund 139.47 1.71%
15 JPMorgan Mutual Fund 132.57 1.63%
16 Religare Invesco Mutual Fund 125.12 1.54%
17 Axis Mutual Fund 123.18 1.51%
18 LIC NOMURA Mutual Fund 79.76 0.98%
19 Canara Robeco Mutual Fund 76.16 0.94%
20 HSBC Mutual Fund 67.18 0.83%
21 JM Financial Mutual Fund 62.44 0.77%

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22 Baroda Pioneer Mutual Fund 52.63 0.65%
23 IDBI Mutual Fund 47.71 0.59%
24 PRINCIPAL Mutual Fund 43.00 0.53%
25 Goldman Sachs Mutual Fund 41.49 0.51%
26 BNP Paribas Mutual Fund 35.38 0.43%
27 Morgan Stanley Mutual Fund 32.90 0.40%
28 Peerless Mutual Fund 28.35 0.35%
29 Taurus Mutual Fund 27.32 0.34%
30 Pramerica Mutual Fund 21.66 0.27%
31 Union KBC Mutual Fund 19.80 0.24%
32 Indiabulls Mutual Fund 16.06 0.20%
33 ING Mutual Fund 11.05 0.14%
34 PineBridge Mutual Fund 11.03 0.14%
35 BOI AXA Mutual Fund 10.82 0.13%
36 Mirae Asset Mutual Fund 5.08 0.06%
37 Motilal Oswal Mutual Fund 4.37 0.05%
38 Quantum Mutual Fund 3.15 0.04%
39 PPFAS Mutual Fund 2.67 0.03%
40 Escorts Mutual Fund 2.52 0.03%
41 Sahara Mutual Fund 2.33 0.03%
42 IIFL Mutual Fund 2.07 0.03%
43 Edelweiss Mutual Fund 1.94 0.02%
44 Daiwa Mutual Fund 0.51 0.01%
45 IL&FS Mutual Fund (IDF) - 0.00%
46 Shriram Mutual Fund - 0.00%
47 SREI Mutual Fund (IDF) - 0.00%
Grand Total 8,142.68
100.0%

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A COMPARATIVE ANALYSIS OF MUTUAL FUND SCHEMES
Equity Diversified Scheme
AUM or Asset Under Management is the total market value of investments
managed by an asset management company (AMSs).
AMC wise Quarterly Average AUM
Mutual Fund Name
No. of
Funds
QAAUM
Date
QAAUM (Rs.
Cr)
Prev
Date
Prev QAAUM
(Rs. Cr)
Inc/Dcr
(Rs. Cr)
Aditya Birla Sun Life
Mutual Fund
125 Mar 2022 269278.03
Dec 2021
255458.48 13819.55
Axis Mutual Fund 50 Mar 2022 196548.66 Dec 2021 177473.65 19075.01
Baroda Mutual Fund 21 Mar 2022 9624.44 Dec 2021 8269.68 1354.76
BNP Paribas Mutual Fund 18 Mar 2022 7830.18 Dec 2021 7323.49 506.69
BOI AXA Mutual Fund 16 Mar 2022 2288.11
Dec 2021
2349.96 -61.85
Canara Robeco Mutual
Fund
23 Mar 2022 28241.44 Dec 2021 23177.03 5064.41
DSP Mutual Fund 63 Mar 2022 97352.83
Dec 2021
89457.34 7895.49
Edelweiss Mutual Fund 38 Mar 2022 46844.09 Dec 2021 41418.59 5425.5
Essel Mutual Fund 10 Mar 2022 697.45
Dec 2021
669.95 27.5
Franklin Templeton
Mutual Fund
77 Mar 2022 82441.26 Dec 2021 81154.98 1286.28
HDFC Mutual Fund 102 Mar 2022 415566.1
Dec 2021
389466.56 26099.54
HSBC Mutual Fund 35 Mar 2022 10373.72 Dec 2021 9953.7 420.02

Pranav Kr Singh
Page - 71
Mutual Fund Name
No. of
Funds
QAAUM
Date
QAAUM (Rs.
Cr)
Prev
Date
Prev QAAUM
(Rs. Cr)
Inc/Dcr
(Rs. Cr)
ICICI Prudential Mutual
Fund
174 Mar 2022 405360.42 Dec 2021 379901.26 25459.16
IDBI Mutual Fund 22 Mar 2022 4120.2
Dec 2021
4324.6 -204.4
IDFC Mutual Fund 58 Mar 2022 122110.74 Dec 2021 121081.39 1029.35
IIFL Mutual Fund 3 Mar 2022 2369.93
Dec 2021
1885.1 484.83
Indiabulls Mutual Fund 15 Mar 2022 663.68 Dec 2021 921.33 -257.65
Invesco Mutual Fund 45 Mar 2022 36791.04 Dec 2021 32739.35 4051.69
ITI Mutual Fund 11 Mar 2022 1178.53
Dec 2021
844.81 333.72
JM Financial Mutual Fund 12 Mar 2022 2383.38
Dec 2021
3699.07 -1315.69
Kotak Mahindra Mutual
Fund
92 Mar 2022 233780.35
Dec 2021
216227.92 17552.43
L&T Mutual Fund 39 Mar 2022 72727.95 Dec 2021 68976.29 3751.66
LIC Mutual Fund 25 Mar 2022 16594.23 Dec 2021 15443.04 1151.19
Mahindra Manulife
Mutual Fund
16 Mar 2022 5271.07
Dec 2021
5058.05 213.02
Mirae Asset Mutual Fund 25 Mar 2022 69597.6
Dec 2021
58070.29 11527.31
Motilal Oswal Mutual
Fund
24 Mar 2022 25763.16
Dec 2021
22761.83 3001.33
Nippon India Mutual Fund 161 Mar 2022 228586.39
Dec 2021
213033.04 15553.35

Pranav Kr Singh
Page - 72
Mutual Fund Name
No. of
Funds
QAAUM
Date
QAAUM (Rs.
Cr)
Prev
Date
Prev QAAUM
(Rs. Cr)
Inc/Dcr
(Rs. Cr)
PGIM India Mutual Fund 33 Mar 2022 6522.13 Dec 2021 4842.02 1680.11
PPFAS Mutual Fund 3 Mar 2022 8720.3
Dec 2021
6631.72 2088.58
PRINCIPAL Mutual Fund 19 Mar 2022 7768.23 Dec 2021 6854.92 913.31
Quant Mutual Fund 13 Mar 2022 721.48
Dec 2021
453.3 268.18
Quantum Mutual Fund 10 Mar 2022 1785.69 Dec 2021 1592.34 193.35
SBI Mutual Fund 146 Mar 2022 504390.41 Dec 2021 456497.93 47892.48
Shriram Mutual Fund 4 Mar 2022 202.72
Dec 2021
189.43 13.29
Sundaram Mutual Fund 61 Mar 2022 31971.17
Dec 2021
30385.18 1585.99
Tata Mutual Fund 60 Mar 2022 61684.02
Dec 2021
59263.06 2420.96
Taurus Mutual Fund 8 Mar 2022 475.34 Dec 2021 434.33 41.01
Trust Mutual Fund 2 Mar 2022 625.25 Dec 2021
0 625.25
Union Mutual Fund 17 Mar 2022 5240.41
Dec 2021
4612.83 627.58
UTI Mutual Fund 149 Mar 2022 182852.67
Dec 2021
165358.55 17494.12
YES Mutual Fund 3 Mar 2022 109.68
Dec 2021
128.99 -19.31
Note: No. of funds displayed as on latest data.

Internship _report_AT IDFC MUTUAL FUNDS.pdf

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