About Mutual Funds

Creating wealth, Transforming life.
ACKNOWLEDGMENT
Writing acknowledgement is probably the most difficult task for us as this report
is an outcome of the direct and indirect support of many, but only some of who end up
receiving a mention due to several constraints. Yet we would be failing in our duty if we
did not mention the names of at least a few of the many institutions and individuals who
spontaneously supported us in completing the project, and without whose support this
study would have remained incomplete.
We are really very thankful to the owner of our firm, Mr. Neeraj Choksi for
allowing us to conduct the study in NJ India Invest.
We would like to express our sincere gratitude towards Mr Avinash Sir, branch
manager, Suart for his keen interest and generously helping and guiding us in preparing
this report.
We would also like to thank NJ India Invest Family, Surat who has helped us
directly or indirectly in completing this project.
We would also like to thank some key personnel like Jay, Ashlesh sir, Dharmesh
sir who have contributed significantly in preparing this report.
Last but not least we would like to express our sincere gratitude to Mr. Mayur
Patel and all the faculty members and whole Navnirman Institute family for their constant
support and guidance because without their help this project wouldn’t be possible.
Devika Jariwala Rubab Lokhandwala Nirali Shah
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PREFACE
In India the saving contributes more than 26% of G.D.P. This figure shows that
the people of our country are very keen to save their money. Here the proportion of
saving is more than any other countries in the world. Here the rate of return on the saving
is healthy apart from other countries so people tend to save their money rather than
spending it.
In market various instrument (alternatives) are available to save one’s money.

These can be names as Banks, Insurance, Mutual funds, Government Securities, Post
Office Saving, and Public Provident Fund (P.P.F.) and so on. Here people use to save
their money mostly in the government securities because of the safety reasons and they
neglect certain other alternatives in the market. i.e. mutual funds.
In India people seems to be not aware about the various alternatives available for
the investment. They only go for the traditional instruments such as banks and sometimes
they do invest their money in order to save tax in the instruments like insurance and govt.
bonds. Still they are not having the awareness of such instruments. Even the awareness
regarding these alternatives is limited to the certain section of the society.
Now day’s mutual funds are becoming more popular as an investment options as
they give healthy returns equivalent to the stock markets. Still most of the people do not
have the basic knowledge about the mutual fund. Even the insurance is becoming now
days very popular because of its unit linked products in the market. Still the awareness is
very less among the people.
The above facts inclined us to go for the study of the industry and expand ours as
well as investors’ knowledge by doing our summer project in one of the most reputed
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company in the industry named NJ India Invest at Surat. These eight weeks were full of
learning and real world experience.
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Contents
• Acknowledgement 1
• Preface 2
1. Introduction to Mutual Fund

1.1 Mutual Fund – 6
1.2 How safe is Mutual Fund- 11
1.3 Types Of Mutual Funds- 13
1.4 Future of Mutual Fund -17
1.5 Advantages – Disadvantages of Mutual Fund- 18
2. History of the Firm- 22

2.1 NJ Divisions- 25
2.2 Management- 28
2.3 Products- 30
2.4 Recognitions- 31
3. Marketing Department
3.1 Mutual Fund Marketing Perspective- 32
3.2 Activities of Marketing Department- 35
3.3 Marketing Environment- 38
3.4 Product Life Cycle- 41
3.5 Packaging and Labeling- 44
3.6 Pricing Policies- 45
3.7 Distribution Channel- 46
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4. Human Resource Department

4.1 Human resource Management- 53
4.2 Human Resource Department-54
4.3 Hierarchy Structure of NJ- 56
4.4 Recruitment and Selection- 57
4.5 Human Resource Planning- 59
4.6 Training and Development- 61
4.7 Promotion and Transfer- 64
4.8 Performance Appraisal- 66
4.9 Salary and Wages- 68
4.10 Employee Welfare- 70
4.11 Absenteeism Rate- 73
4.12 Employees Turnover- 74
4.13 Human Resource Audit- 75
5. Operations Department
5.1 Operations Management- 77
5.2 Activities of Operation Department- 78
5.3 Service Operation- 83
5.4 Job Design- 84
5.5 Process Design- 93
5.6 Project Planning and Control- 95
5.7 Total Quality Management- 97
5.8 Total Productivity of Employee- 102
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6. Finance Department:
6.1 Financial Management- 104
6.2 Activities of Financial Department- 105
6.3 Cash Budget- 109
6.4 Fund Flow Statement- 111
6.5 Working Capital Requirement- 115
6.6 Annual Reports- 118
6.7 Accounting Ratios- 121
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1. ABOUT MUTUAL FUNDS:

The modern mutual fund was first introduced in Belgium in 1822. This form of
investment soon spread to Great Britain and France. Mutual funds became popular in the
United States in the 1920s and continue to be popular since the 1930s, especially open-
end mutual funds. Mutual funds experienced a period of tremendous growth after World
War II, especially in the 1980s and 1990s.
The mutual fund industry in India started in 1963 with the formation of Unit Trust
of India, at the initiative of the Government of India and Reserve Bank of India. The
history of mutual funds in India can be broadly divided into four distinct phases
First Phase – 1964-87
Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was
set up by the Reserve Bank of India and functioned under the Regulatory and
administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the
RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and
administrative control in place of RBI. The first scheme launched by UTI was Unit
Scheme 1964. At the end of 1988 UTI had Rs.6,700 crores of assets under management.
Second Phase – 1987-1993 (Entry of Public Sector Funds)
1987 marked the entry of non- UTI, public sector mutual funds set up by public
sector banks and Life Insurance Corporation of India (LIC) and General Insurance
Corporation of India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund
established in June 1987 followed by Canbank Mutual Fund (Dec 87), Punjab National
Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90),
Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund in June 1989
while GIC had set up its mutual fund in December 1990. At the end of 1993, the mutual
fund industry had assets under management of Rs.47,004 crores.
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Third Phase – 1993-2003 (Entry of Private Sector Funds)
With the entry of private sector funds in 1993, a new era started in the Indian
mutual fund industry, giving the Indian investors a wider choice of fund families. Also,
1993 was the year in which the first Mutual Fund Regulations came into being, under
which all mutual funds, except UTI were to be registered and governed. The erstwhile
Kothari Pioneer (now merged with Franklin Templeton) was the first private sector
mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund) Regulations were
substituted by a more comprehensive and revised Mutual Fund Regulations in 1996. The
industry now functions under the SEBI (Mutual Fund) Regulations 1996. The number of
mutual fund houses went on increasing, with many foreign mutual funds setting up funds
in India and also the industry has witnessed several mergers and acquisitions. As at the
end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores.
The Unit Trust of India with Rs.44,541 crores of assets under management was way
ahead of other mutual funds.
Fourth Phase – since February 2003
In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI
was bifurcated into two separate entities. One is the Specified Undertaking of the Unit
Trust of India with assets under management of Rs.29,835 crores as at the end of January
2003, representing broadly, the assets of US 64 scheme, assured return and certain other
schemes. The Specified Undertaking of Unit Trust of India, functioning under an
administrator and under the rules framed by Government of India and does not come
under the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of
assets under management and with the setting up of a UTI Mutual Fund, conforming to
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the SEBI Mutual Fund Regulations, and with recent mergers taking place among
different private sector funds, the mutual fund industry has entered its current phase of
consolidation and growth.
Mutual Funds in India is gaining ground and getting popular as an investment

option. The fund industry has witnessed healthy growth in last five years or so. Mutual
Fund is a common pool of savings created by a number of investors. Mutual Fund is an
ideal investment product for an individual investor. Different investors with common
investment objective contribute to create a common pool of money. This money is then
invested by fund manager according to the objective of the scheme.
Structure of Mutual Funds:
In India mutual funds function as trust created under the Indian Trust Act, 1882.
There are three layers of mutual fund in India. (i) Sponsors (ii) Trustee and (iii) Asset
Management Company. Sponsors work as Promoters of the company. They take
responsibility of starting mutual fund business. Sponsors contribute initial capital (40% of
net worth of AMC) and appoint Trustees and Board of Trustees. Board of Trustees act as
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guardians of investors and ensure that money invested by investors is used according to
the objective of the scheme. Asset Management Company is the public face of fund
management business. Sponsors and Trustees together form AMC and appoint Fund
Manager. Fund manager with help of fund management team makes all investment
decisions.
Regulatory Authorities:
To protect the interest of the investors, SEBI formulates policies and regulates the
mutual funds. It notified regulations in 1993 (fully revised in 1996) and issues guidelines
from time to time. MF either promoted by public or by private sector entities including
one promoted by foreign entities is governed by these Regulations.
SEBI approved Asset Management Company (AMC) manages the funds by

making investments in various types of securities. Custodian, registered with SEBI, holds
the securities of various schemes of the fund in its custody.
According to SEBI Regulations, two thirds of the directors of Trustee

Company or board of trustees must be independent.
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The Association of Mutual Funds in India (AMFI) reassures the investors in units
of mutual funds that the mutual funds function within the strict regulatory framework. Its
objective is to increase public awareness of the mutual fund industry.
AMFI also is engaged in upgrading professional standards and in promoting best

industry practices in diverse areas such as valuation, disclosure, transparency etc
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1.2 HOW SAFE IS INVESTING IN MUTUAL

FUNDS?
In India mutual funds function as trusts. The sponsor of the fund appoints Board
of Trustees who acts as guardians of investor's money. The board or Trustee Company, as
an independent body acts as protector of the unit holder's money. These trustees ensure
that investor's interest is safeguarded and that the AMC's operations and Fund Manager's
actions are along the professional lines. To ensure independence of Board of Trustees,
SEBI mandates a minimum of two-third independent directors on the board of Trustee
Company.
Apart from Trustees, the entire mutual fund industry functions under the preview
of SEBI. This structure and stringent guidance make investing in mutual funds safe and
easy. Fund Managers also have to function within the broad framework and rules &
regulations designed by AMC.
Investing in Mutual Fund:
Mutual funds are considered as favorable investment vehicle for individual

investors particularly for investors who have limited resources available in terms of
capital and ability to carry out their investment decisions.
Advantages of investing in mutual funds:
Portfolio Diversification:
‘Do not Put All Eggs in One Basket’. Mutual Fund is the best vehicle to apply this
proverb in practical life as a diversified equity scheme invests across multiple sectors and
stocks. A typical diversified equity scheme holds around 30 to 50 stocks in portfolio so
even if few stocks or sectors do not perform well investor’s money can get protected.
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Diversification of Risk:
Whatever is your investment amount, that amount gets diversified across multiple
stocks held by fund manager.
Liquidity:
Mutual Fund investment provides high degree of liquidity as investors can sell
units to the fund if scheme is open ended or in the stock market if scheme is close ended.
Investor normally gets money credited in bank account or receives cheque within three
working days of redemption.
Professional Management and Expertise:
Through mutual fund, individual investor can take advantage of expertise of fund
manager and his fund management and research team. This kind of detailed research
work is not possible to do for an individual investor. Fund managers are highly qualified
and experienced in their field which allows investors to take advantage of their expertise.
Convenience:
Mutual Funds score over other products in terms of convenience and ease. What
investors require is to fill an application form and attach a copy of PAN card and cheque.
Tax Advantage: Investment made in mutual funds offer multiple tax advantages and
proves tax efficient. There is no long term capital gain in equity schemes if an investor
stays invested for one year. Dividends are also tax free in hands of investors in equity
schemes.
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1.3 TYPES OF MUTUAL FUNDS

Most funds have a particular strategy they focus on when investing. For instance,
some invest only in Blue Chip companies that are more established and are relatively low
risk. On the other hand, some focus on high-risk start up companies that have the
potential for double and triple digit growth. Finding a mutual fund that fits your
investment criteria and style is important. Types of mutual funds are:
Value stocks
Stocks from firms with relative low Price to Earning (P/E) Ratio usually pay good
dividends. The investor is looking for income rather than capital gains.
Growth stock
Stocks from firms with higher low Price to Earning (P/E) Ratio usually pay small
dividends. The investor is looking for capital gains rather than income.
Based on company size, large, mid, and small cap
Stocks from firms with various asset levels such as over $2 Billion for large; in
between $2 and $1 Billion for mid and below $1 Billion for small.
Income stock
The investor is looking for income which usually comes from dividends or
interest. These stocks are from firms which pay relative high dividends. This fund may
include bonds which pay high dividends. This fund is much like the value stock fund, but
accepts a little more risk and is not limited to stocks.
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Index funds
The securities in this fund are the same as in an Index fund such as the Dow Jones
Average or Standard and Poor's. The number and ratios or securities are maintained by
the fund manager to mimic the Index fund it is following.
Enhanced index
This is an index fund which has been modified by either adding value or reducing
volatility through selective stock-picking.
Stock market sector

The securities in this fund are chosen from a particular marked sector such as
Aerospace, retail, utilities, etc.
Defensive stock
The securities in this fund are chosen from a stock which usually is not impacted
by economic down turns.
International
Stocks from international firms are traded in international mutual fund.
Real estate
Stocks from firms involved in real estate such as builder, supplier, architects and
engineers, financial lenders, etc.
Socially responsible
This fund would invest according to non-economic guidelines. Funds may make
investments based on such issues as environmental responsibility, human rights, or
religious views. For example, socially responsible funds may take a proactive stance by
selectively investing in environmentally-friendly companies or firms with good employee
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relations. Therefore the fund would avoid securities from firms who profit from alcohol,
tobacco, gambling, pornography etc.
Balanced funds
The investor may wish to balance his risk between various sectors such as asset
size, income or growth. Therefore the fund is a balance between various attributes
desired.
Tax efficient
Aims to minimize tax bills, such as keeping turnover levels low or shying away
from companies that provide dividends, which are regular payouts in cash or stock that,
are taxable in the year that they are received. These funds still shoot for solid returns;
they just want less of them showing up on the tax returns.
Convertible
Bonds or Preferred stock which may be converted into common stock are
included here.
Junk bond
Bonds which pay higher that market interest but carry higher risk for failure and
are rated below AAA.
Mutual funds of mutual funds

This funds that specializes in buying shares in other mutual funds rather than
individual securities are mutual funds of mutual funds.
Closed end
This fund has a fixed number of shares. The value of the shares fluctuates with the
market, but fund manager has less influence because the price of the underlining owned
securities has greater influence.
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Exchange traded funds (ETFs)

Baskets of securities (stocks or bonds) that track highly recognized indexes.
Similar to mutual funds, except that they trade the same way that a stock trades, on a
stock exchange.
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1.4 FUTURE OF MUTUAL FUND INDUSTRY:

The mutual fund industry is still at an embryo stage in India. With savings rate of
about 25% and a booming economy, mutual fund industry has a great scope to expand,
provided they evolve out of the existing challenges. The major issue for the industry is its
lack of penetration.
In 2004, the rate of penetration was standing at 13.7 per cent in urban households
against 3.8 per cent in rural households. Another threat for the industry is “over
conservatism” of the fund managers. Considering the investment pattern of the mutual
funds in comparison with investments made by FIIs during financial year 2004-05, they
completely hang around the opposite poles.
Mutual funds have invested 97% of the total investments in the debt market
whereas FII investments are 96% in equities. Such high investments in an under
developed debt market operating in a rising interest rate environment is no way
appreciable. Thus, maintaining such high debt investments is just another kick to the
returns of the investors, especially during the Bull Run.
Regulation is another key area of concern in the industry. SEBI, which also
extends its supervision over capital markets, somehow finds time to regulate the
operation and management of mutual funds as well. The series of controversies that took
place involving Alliance Capital Mutual Fund (ACMF) and Samir Arora, its erstwhile
star fund manager regarding internal control practices clearly sends signals for the
requirement of careful watchdogs for the industry.
As such, Indian investors are extremely apprehensive when it comes to stock
market investments, as they have been often battered by a series of scams and scandals. It
is imperative for the industry to develop and derive a communication strategy, which not
only removes existing apprehensions of Indian investors, but also creates an environment
of transparency and trust. After all it is not so very difficult to create wealth mutually.
Till now AMCs were investing in capital market, debt market and money market
but now they are permitted to invest in real estate as well as commodities like gold,
silver, grains etc.
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1.5 Advantages and Disadvantages of Mutual Fund
Advantages of Mutual Fund
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.
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.
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.
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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.
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.
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.
Transparency
Investors get regular information on the value of their investment in addition to
disclosure on the specific investments made by their scheme, the proportion invested in
each class of assets and the fund manager's investment strategy and outlook.
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.
Affordability
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.
Choice of Schemes
Mutual Funds offer a family of schemes to suit your varying needs over a
lifetime.
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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.
Disadvantages of Mutual Fund
Entry and Exit load

Mutual funds are a victim of their own success. When a large body like a fund
invests in shares, the concentrated buying or selling in adverse price movements lay at
the time of buying, the fund ends up paying a higher price and while selling it realize a
lower price. This problem is especially severe in emerging markets like India, where,
excluding a few stocks, even the stocks in the Sensex are not liquid. Let alone stocks in
the NSE 50 or the CRISIL 500. So there is simply no way that a fund can beat the Sensex
or any other index, if it is blindly invests in the same stocks as those in the Sensex and in
the same proportion.
No control over costs

The costs of the fund management process are deducted from the fund. This
includes marketing and initial costs deducted at the time of entry itself, called, ‘Load’.
Then there is the annual asset management fee and expenses, together called the expense
ratio. Usually, the former is not counted while measuring performance, while the latter is.
A Standard 2 percent expense ratio means that, everything else being equal, the fund
manager under performs the benchmark index by an equal amount.
No tailor-made portfolio
The portfolio of a fund does not remain constant. The extent to which the
portfolio changes is a function of the style of the individual fund manager i.e. whether he
is a buy and hold type of manager or one who aggressively churns the fund. It is also
depends on the volatility of the fund size i.e. whether the fund constantly receives fresh
subscriptions and redemptions. Such portfolios changes have associated costs of
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brokerage, custody fees, registration fees etc. that lowers the portfolio return
commensurately.
No Guarantee of return
No investment is risk free. If the entire stock market declines in value, the value
of mutual fund shares will go down as well, no matter how balanced the portfolio.
Investors encounter fewer risks when they invest in mutual funds than when they buy and
sell stocks on their own. However, anyone who invests through a mutual fund runs the
risk of losing money.
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.
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.
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2. HISTORY:
Doing the 'right' thing is a virtue most desirable. The difference between success
and failure is often not dictated by knowledge or expertise but by its actual application
and perseverance. When it comes to successful wealth creation for customers, it is
something that they believe & practice. For us it is more than a mission; it is what defines
their lives and their actions at NJ India Invest. With this passion, they continue to evolve
and make the right product accessions and service innovations in their offerings. To the
advisors, they offer a 360 comprehensive business platform with unmatched IT solutions,
empowering them to set the best practice standards and deliver real value to their
customers. Over the years, their passion has seen them grow from strength to strength and
expand rapidly, setting new benchmarks in the process. But to them, what really matters
most is the number of lives they have managed to transform.
NJ India Invest Pvt. Ltd. is one of the leading advisors and distributors of
financial products and services in India. Established in year 1994, NJ has over a decade
of rich exposure in financial investments space, portfolio advisory services and
distribution of financial products.
At NJ they exist to provide quality financial / investment advisory solutions to

customers of diverse profiles and needs. They aim to take the benefits of a maturing
Indian financial market to the masses and provide them with solutions that best serve
their interests.
At NJ it is believe having single window, multiple solutions that are integrated for
simplicity and sapience making innovations, accessions, value-additions, a constant
process providing customers with solutions for tomorrow which will keep them above the
curve, today.
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NJ had over INR 5,050* Crores of mutual fund assets under advice with a wide
presence in over 130 locations* in 22 states* in India. The numbers are reflections of the
trust, commitment and value that NJ shares with its clients
At NJ, they continue to innovate, enrich their intellect, and ask critical questions.
They challenge their own processes and systems on constant basis to emerge more
convinced. At NJ, they continue to expand the scope and depth of their offerings, making
apt use of technological support.
Today NJ India Invest Pvt. Ltd. is one of the leading advisors and distributors of
financial products and services in India. Established in year 1994, NJ has over a decade
of rich exposure in financial investments space and portfolio advisory services. From a
humble beginning, NJ, over the years has evolved out to be a professionally managed,
quality conscious and customer focused financial / investment advisory & distribution
firm.
They are headquartered in Surat, India, and have more than INR 7,500* Crores of
mutual fund assets under advice, with a wide presence at over 110* locations in 20*
states in India. The numbers are reflections of the trust, commitment and value that NJ
shares with 11* Lacs customer base with over 14000 Advisors.
NJ prides in being a professionally managed, quality focused and customer centric

organization. The strength of NJ lies in the strong domain knowledge in investment
consultancy and the delivery of sustainable value to clients with support from cutting-
edge technology platform, developed in-house by NJ.
At NJ, they believe in.
Having single window, multiple solutions that are integrated for simplicity and sapience
Making innovations, accessions, value-additions, a constant process
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Providing customers with solutions for tomorrow which will keep them above the curve,
today
Technology has traditionally been NJ's key strength. Their offering on the
technological front is unmatched, vibrant, and comprehensive in nature. Their focus &
commitment on technology can be gauged from the fact that they have set-up distinct
entity with a very strong, talented work-force for the sole purpose of providing the best to
NJ in terms of technology and support. Finlogic Technologies (India) Pvt. Ltd. does all
the development & support work in-house on a continuous basis. It has successfully
developed & implemented a powerful support system for the mutual fund distribution
business at NJ with a provision for integrating the same with other investment products as
well as the financial accounting system. Today Finlogic Technologies has more than 100
employees for its IT development
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2.1 THEIR DIVISIONS
NJ FUNDZ NETWORK:
NJ Fundz Network has been playing a pioneering role in India in providing

independent advisors / advisory firms with integrated, comprehensive and practical
business solutions for ensuring continuous growth & continuity of business. It provides
the financial advisors and the institutions that serve them with insights, strategies and
tools to help them significantly grow their businesses. How do they do it? That’s because
they understand how financial & wealth management businesses work and what is
needed to manage, monitor and grow the practice.
With the 360° Advisory platform, NJ has managed to successfully transform the
business of many advisory / distribution houses, bringing them on equal footing or even
better than the toughest competitors in the industry in the concerned domain. With a vast
experience & strong delivery mechanism, we at NJ Fundz Network, help & ensure
transformation and the exploitation of the opportunities available.
First in the Indian Mutual Fund Industry to offer a Complete Business Platform to
Advisors
NJ REALTY SERVICES:
This is an integrated service model offering solutions for meeting the diverse real-
estate needs of corporate & retail customers in transacting properties.
Finding the right property at the right value and the best buyer for a property is
the crux of any realty solution. At NJ India Realty they value this critical element of
retailing and aim to provide the customer with an integrated service model that not only
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focuses on the customers meeting his desired needs but also on enhancing the overall
experience of the transaction.
The scope of properties embraces both commercial & residential projects /

properties. The integrated value-added services ensure that the solutions are feasible,
authentic, secure & profitable.
Leveraging upon the strengths of the parent company NJ, NJ India Realty aims to
offer attractive options and operational guidance to satisfactorily realize the customer’s
realty dreams.
Today NJ Realty Services has tied up with over 40 developers with over 150
projects across India.
NJ GURUKUL:
Making people benefit from the growing economy is possible by attracting them
to participate in Equity for long term, to make their money work for itself and create
wealth. For this to happen, a huge force of effective Financial Advisors is needed.
Visualizing this need and with a view to bridge the gap, NJ India Invest Pvt. Ltd. has set
up NJ Gurukul to offer different training programs at moderate costs.
NJ Gurukul works to conceive craft, design, develop and execute effective

training modules to energize people with right inputs through different training programs
at modest cost. Powered by NJ's experience of over 14 years as leaders in financial
advisory services, NJ Gurukul has emerged successful in conducting sizeable number of
trainings since inception in April 2007 and enjoys lineage of efforts put in by NJ prior to
April 07. NJ Gurukul seeks to create an enlightened community of ‘quality’ financial
advisors capable of changing millions of lives across India and even beyond.
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NJ Gurukul also seeks to help people become better professionals / business

personalities & achieve success in their own endeavors.
For businesses, as a people partner, NJ Gurukul seeks to groom employees &

management so that they deliver upon their expectations & responsibilities, successfully.
NJ Gurukul is authorized to give training for Certified Financial Planner (CFP) by FBSB
India. Today NJ Gurukul has offered over 1200 training programs with over 20000
candidates.
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2.2 MANAGEMENT:
The management at NJ brings together a team of people with wide experience and
knowledge in the financial services domain. The management provides direction and
guidance to the whole organization. The management has strong visions for NJ as a
globally respected company providing comprehensive services in financial sector.
The 'Customer First' philosophy is deeply ingrained in the management at NJ. The
aim of the management is to bring the best to the customers in terms of:
• Range of products and services offered

• Quality Customer Service
All the key members of the organization put in great focus on the processes &
systems under the diverse functions of business. The management also focuses on
utilizing technology as the key enabler for all the activities and to leverage the technology
for enhancing overall customer experience.
The key members of the management are:
Mr. Neeraj Choksi Jt. Managing Director

Mr Jignesh Desai Jt. Managing Director
Key Sales Team:
Mr. Misbah Baxamusa National Head

Mr. Naveen Rathod V.P. (Sales)
Mr. Kulbhushan Nandwani A.V.P. (Marketing)
Mr. Prashant Kakkad A.V.P. (Sales)
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Key Executive Team:
Mr. Shirish Patel Information Technology

Mr. Abhishek Dubey Business Process
Mr. Vinayak Rajput Operations
Mr. Dhaval Desai Human Resources
Mr. Col. Dixit Administration
Mr. Tejas Soni Finance
Mr. Viral Shah Research
Mr. Rakesh Tokarkar Compliance
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2.3 PRODUCTS:
NJ offers advisory and distribution services on the following products.
1. Mutual funds – covering all AMCs &

all schemes
2. Fixed deposits of companies
3. Government/ RBI Bounds
4. Infrastructure Bonds,
5. Approved securities for charitable trusts,

etc
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2.4 RECOGNITIONS:
Some of the awards and recognitions that they have received in past are:
Year 2000:
For Outstanding Performance presented by
Chairman, Prudential Plc. at London
Year 2002:
For Outstanding Performance presented by Group
Chief Executive, Prudential Plc. at London
Year 2003:
For Outstanding Performance presented by Group
Chief Executive, Prudential Plc. at London
Year 2004:
Among Most Valued Business Associates presented
by HDFC Standard Life at Edinburgh, Scotland
Year 2004:
For Outstanding Performance by Deputy CEO,
Prudential Singapore at Malaysia
Year 2006:
Award for mobilizing the Highest Number of SIPs at
National Level by Fidelity Mutual Fund Plc at
Mumbai
Year 2006: Award – Vietnam
- 32 -
3.1 MUTUAL FUND – MARKETING

PERSPECTIVE:
What do mutual funds companies sell? Really speaking, they do not sell anything,
tangible or intangible. This does seem confusing. Banks sell their products based on
certain assured returns; insurance companies sell contracts. Not so mutual funds. They
mobilize funds from the investing public to manage those funds efficiently, i.e. they
create an expectation of good returns in the minds of investors and generate a desire in
them to put their money with a particular fund. Thus, there is a clear distinction between
company shares and mutual fund units. When a company issues capital, investors expect
that company will be able to return the worth of their investments through manufacturing
or servicing activities, but in case of mutual funds, managerial efficiency and investment
skill would determine returns. Successful mutual fund marketing, therefore, must create
confidence among potential investors and strengthen their desire to put their money with
a particular fund.
The market segments are quite distinct because of investment objectives.

Accordingly, a marketing strategy specific to each type of funds needs to be devised.
MARKETING STRATEGIES ADOPTED BY THE MUTUAL

FUNDS
The present marketing strategies of mutual fund products can be divided into
following heads:
(a) Direct Marketing
(b) Selling through Intermediaries
(c) Other Channels
(a) Direct Marketing

This constitutes 20 % of the total sales of mutual funds. Some of the important
tools used in this type of selling are:
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Personal selling
In this case, the Customer Support Officer at particular branch takes appointment
from the potential prospect. Once the appointment is fixed, he informs the management
executives in marketing department to meet and give him all details about the schemes
being offered by the fund.
Telemarketing
In this type of marketing, the database of the people is to be picked from the
telephone directory or other commercial sources randomly. Sometimes people belonging
to particular profession are also contacted through phone and informed about fund.
Advertisements
The Asset Management Companies advertises the particular schemes in
newspaper, magazines, televisions and radios at regular interval of time. Now days,
mutual fund NFOs (IPO’s) are coming at every two months, which are heavily advertised
through these mediums. The purpose is to keep investor aware about the schemes offered
by funds and their performance in recent past.
Hoardings and Banners

In this type of marketing, the various funds advertised their schemes through
hoardings and banners, which are put at important locations of the city where the
movement of the people is very high
.
(B) Selling Through Intermediaries

Intermediaries include Distributors or Agents or Brokers who contribute in great
manner to increase the sales of mutual funds schemes. These people or distributors are in
direct touch with the investors. Most of them are also involved in selling shares and other
investment instruments. They are completely associated with financial markets and hence
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perform a good job to convince the investors to invest in mutual funds. On the other
hand, customers prefer to put trust on those distributors who give them right information
about the fund and keep them update with market conditions.
Regular meeting with distributors is also plays vital role in collecting the sales of
mutual funds. The Sales executives are regularly meet with these distributors and solve
their requirements and complain from either service side or from customer side. The
objective is to make a good business relation and work with co-operation because these
distributors or brokers contribute 70-80% of total sales of mutual funds.
Sometimes special training sessions are also to be organized for the new agents or
distributors. Training involves giving details about the schemes, their investment
objective, its performance in the market and the competitors’ schemes also.
Sometimes big distributors have their own sub agents or sub brokers to increase
their sales activities.
(C) Other Channels

Apart from direct marketing and intermediaries, there are other distribution
channels also developed by mutual funds. It includes banks and other financial
institutions that are promoting these mutual funds schemes as per the regulations
prescribed by SEBI and RBI. In private as well as nationalized banks, there is a separate
section for mutual funds. They have their own executives with efficient sales force to
promote the mutual fund schemes among their customers.
Nowadays, Mutual fund companies also set up their own professional distribution
units to promote the mutual fund schemes and with an object to expand the business.
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3.2 ACTIVITIES OF MARKETING

DEPARTMENT:
Some of the activities NJ India Invest practices in marketing department are as

follows:
1. Joint calls
2. Client meet
3. Stall activity
4. Van activity
5. SMS
6. Courier
7. Khichdi meet
8. Large meeting
9. E-Mails
1. Joint calls:
Joint calls includes the calling the partners and informing them about
various new schemes and keeping them aware about the market conditions. It also
includes going to the partner and explaining him about the new stocks in the
market and where actually he is investing his money i.e. in what type of mutual
fund he wants to invest and what is the amount. Sometimes the head also
accompanies the mutual fund advisory to do joint calls.
2. Client meet:
Client meets are arranged whenever it is required. There are different
meets like meet for issuing of new mutual funds, a project visit incase of NJ
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reality, meeting telling the partners about the conditions and new schemes which
are recently added. These meetings and gatherings are known as client meets.
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3. Stall Activity:
NJ uses a very common technique as its marketing techniques, i.e. keeping
stalls and booths at various fairs. At these stalls the try to get convince the people
to invest in mutual funds and become an advisor. This is a widely used technique
by major by NJ India Invest.
4. Van Activity:
Another technique used by NJ is using a car for advertising. Majorly
Maruti car is used for doing this work.
5. SMS:
In this modern time marketing through SMS is a very trendy and
extensively used method. It is the fastest way of communication. NJ too uses this
method for its marketing. Leads are collected from various different places and
these people are messaged about the attractive schemes which would convince
them be become an advisor. Even the current partners are informed about various
meeting or any information to be conveyed to them is done through SMS.
6. Courier:
This is technique is also used for marketing of NJ India Invest. Different
brochures, templates, booklets are sent on Monthly or weekly bases to the
partners places. This keeps the partners update with what is going on in the firm
and market conditions.
7. Khichdi Meet:
Khichidi meet is one of the unique marketing techniques used by NJ India
Invest. In this meet 10 to 15 partners are invited. This is a technique which makes
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the partners feel their importance in the company and motivates them to work
more and more.
8. Large Meets:
Large meetings are held when different brokers or partners get together and
arrange a meeting for their clients. These meets can be for a new scheme or some
changes etc. These meets makes the clients fell that NJ is concerned for them and
motivates them.
9. E-Mails:
Emails are also frequently used technique by NJ India Invest. Different
schemes showing the return % are sent to clients as an email. This is a quick and
efficient way of marketing and making the clients aware about various things going
around him.
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3.3 MARKETING ENVIRONMENT:
Global marketing issues concerning the process involved in planning for global
marketing. It stresses that, without careful consideration of the contemporary
developments in the emerging global market environment involved in the planning for
global marketing, the chances of survival for any organizations are minimal. The
emphasis is on the changes and new challenges that the marketing environment poses to
the global marketer.
Global marketing has become a popular subject, which is reflected in the

burgeoning number of publications in this area. In the light of increasing globalization of
the world economy, global marketing is a necessity for the survival of all organizations,
big or small, rather than a luxury traditionally reserved for the multinational corporations
(MNCs). As consumers and citizens, we live in an era when almost everything can be
made and sold anywhere. The phrase ‘global village’ is such an integral part of the
international vocabulary that it is difficult to conceive of a place which is not touched by
something ‘international’. Climbing Mount Everest, for instance, once an awe-inspiring
achievement for the brave few is no longer an expedition but a commoditized package
tour. Growth in the total volume and value of world trade now exceeds any other period
in history.
The actors and forces outside marketing that affect marketing management’s
ability to build and maintain successful relationships with target customers. It consists of
the task environment and the broad environment. The task environment includes the
actors engaged in producing, distributing, and promoting the offerings. These are the
company suppliers, distributers, dealers and the target customers. In the suppliers group
are material suppliers and service suppliers, such as marketing research agencies,
advertising agencies, banking and insurance companies, transportation companies, and
telecommunication companies. Distributers and dealers include agent, brokers,
manufacturer’s representatives, and others who facilitate finding and selling to customers.
- 40 -
The broad environment consists of six components: Demographic environment,

economical environment, physical environment, technological environment, political-
legal environment, and social-culture environment. Marketers should pay close attention
to the trends and developments in these environments and make timely adjustments to
their marketing strategies.
Even though NJ is the market leader in mutual funds, some of the major
competitors of NJ India Invest are:
1. Angle Broking:
Angel Broking, Ltd. provides retail personal financial services in India.
The company offers e-broking, portfolio management, mutual fund, private client
group, commodities broking, investment advisory, wealth management, IPO, and
depository services. The company was founded in 1987 and is based in Mumbai,
India.
Investing in a Mutual fund is an excellent way of diversifying risk as well
as portfolio. Angel presents its Mutual fund services that strive to meet all your
mutual fund investment needs. They have a wide spectrum of investment schemes
from all top mutual fund houses.
Angel also provides recommendations based on in-depth research, mutual
fund performance and mutual fund ratings to help meet your investment goals.
2. Prudent:
Incorporated in year 2000 with a clear vision of providing professional
services in the area of personal and corporate investments, Prudent has created a
niche segment over a period to time with an excellent quality client base. Over the
past few years Prudent Corporate Advisory Services has created in-house
capabilities of analyzing funds on various parameters before suggesting them to
clients.
- 41 -
The team approach worked wonders and in the short-span of just one
decade, the Prudent Group expanded its horizon by offering specialized services
in the areas of Personal and Corporate Investment Planning through Mutual
Funds, Equities, Derivatives, Third Party Products, Fixed Income Products,
Life/General Insurance and Real Estate through various companies listed below.
3. Bjaj Capital
The Bajaj Capital Group is one of India’s premier Investment Advisory and
Financial Planning companies. They are also SEBI-approved Category I Merchant
Bankers.
As one of India’s largest distributors of financial products, they offer a
wide range of investment products such as mutual funds, life and general
insurance, bonds, post office schemes, etc. offered by reputed public and private
and government organizations.
4. Karvy
Since its inception in 1982, Karvy has demonstrated a dedication coupled
with dynamism that has inspired trust from various segments, corporate,
government bodies and individuals. Karvy has since been performing a pivotal
role as the intermediary the interface between these players.
With Mutual Funds emerging as a distinct asset class, Karvy has made a
strategic choice to leverage the power of latest technology to provide a cutting
edge to its services. They, today, service nearly 60% of the asset management
companies (AMCs) across an extensive network of service centers with assets
under service in excess of Rs.220,341.59 crores. Mutual fund services have been
undergoing a sea change in the Indian market place and asset management
companies are finding their niche in delivering unique products and service
offerings.
- 42 -
3.4 PRODUCT LIFE CYCLE:
Every company has a life. Some live short and some live long. Ultimately
whether company is short lived or long its sales declines. During its whole life the
company passes through various stages which is knows as its life cycle. If we study the
life history of any branded multinational company we come to know that the life time
sales of many branded product reveal a typical pattern of development which is known as
product life cycle. It may also be defined as a history of life time sales of a product from
its stage of introduction to the stage of decline.
The life cycle of a product consist of four major stages:

1. Introduction
2. Growth
3. Maturity
4. Decline
- 43 -
Introduction:
With marketing of a new product the first stage of life cycle is known as
introduction begins. During this stage the product is new in the market and a large
number of customers ate not familiar with it. Therefore the volume of sales in the
beginning is very less. During this stage in order to increase sales the company has to
incur advertising expenditure on a large scale, sales representative also to be appointed,
incentives are to be given to them and for a successful entry in the competitive market.
This stage continues as long as incremental rate of sales growth does not go up and
company begins to make profit. The time span of this stage will be short if the product is
quite consistent with the customer’s demand otherwise it’s likely to be long.
Growth:
This stage begins with the increase in the growth rate of sales and earning profit.
If the product is consistent with customers preference, within a short time growth rate of
the sales star to increase. Customers satisfied with purchasing continue to purchase and
canvass the amongst other customers. As a result sales increase with the increase in
production and average cost of production declines and profit increases. During this stage
the product begins to make rapid sales gains because of the cumulative effects of
introductory promotion, distribution and word of mouth influence.
Maturity:
In this stage sales growth continues but at a declining rate because of the
diminishing number of potential customers who remains unaware of the product. When
sales growth rate reaching to the highest level begins to decline maturity stage begins.
This stage lasts longer than earlier stages.
- 44 -
Maturity stage consists of three stages:

1. In the beginning sales increases but at declining rate
2. In second stage sales remains stable
3. In third stage sales begins to decline.
During the maturity stage market become highly competitive. Competitors resort
to cut price. The company has also to decrease the price to survive competition. As a
result profit and sales growth rate either cease to increase or increase at decreasing rate.
Decline:
In this stage sales begin to diminish absolutely as the product gradually replaced
by better products or substitutes. No doubts. The producer continues to make efforts to
increase the sales but the efforts do not bear the fruits. Sale get stagnated for some time
and therefore begins to decline profit also stats declining and number of customers also
decline. Generally because of changing preferences of customers or losing utility by the
product sales reach this stage of decline.
NJ India Invest today is in the growth stage. It is the market leader since last 5
years. In this stage new product are to be searched on. So due to the excellent outcome of
mutual funds NJ has now started with new financial products like SIP, Portfolio
management, Reality, and insurance. New campaign to search out new areas of market is
one of the marketing strategies a company has to consider. This is exactly what is done
by NJ, to find out new customers leads are collected from various sources by given
brochures, arranging meeting and giving information to the newly recruited members.
Other marketing strategy which is followed by NJ is they find different source of
advertisement and find out new channels of distribution for wide spread sales. It is very
necessary to build in trust in our customers and to enhance that trust NJ follows various
different techniques such as calling the client, keeping them updated with new schemes
etc.
- 45 -
3.5 PACKAGING AND LABELLING:
Packaging:
Packaging is all the activities of designing and producing the container for the
product. Packages might include up to three levels of material.
 Primary package: Cool water cologne comes in a bottle.

 Secondary package: In a cardboard box.
 Shipping package: In a corrugated box containing six dozen boxes.
In NJ India Invest, the products of mutual funds, fixed deposits, insurance, reality etc.
thus packaging does not take place.
Labeling:
The label may be a simple tag attached to the product or an elaborately designed
graphic that is the part of the package. It might carry only the brand name, or a great deal
of information. Labeling performs various functions:
 Label identifies the product or the brand

 Label also grades the product such as on the fruits of reliance fresh written best
quality or export quality.
 It describes the product such as:
 Who made it where it was made
 When it was made
 What it contains
 How it is to be used
 How to use it safely
- 46 -
As NJ is a service firm, there is no labeling done here.
3.6 PRICING POLICIES:
LOCATION
ACQUISITION
COST
These three are the major factors which are taken into account while deciding the
pricing policies. Location is most prominent factor.
For ex: the hoarding placed in the midst of the city would cost more in relation to the
hoardings placed at the outer areas of Surat.
NJ India Invest comprises of products like mutual funds, reality, insurance fixed
deposits, portfolio management service, etc. there is no specific pricing policies. It has to
go with the prevailing market rates.
- 47 -
3.6 DISTRIBUTTION CHANNEL:
A new mutual fund product may have all the desired qualities but that does not
ensure its spontaneous acceptance by customers. Success would greatly depend on
appropriate distribution and promotion. The identification of appropriate market
segments for the product, selection of appropriate distribution channels and promotional
aids are essential.
Rel. India SBI ICICI
Mutual Fund
AMC’S
Banks and Large

Distribution Companies (NJ
Individual Agents INDIA) Institutional Brokers
NJ Fund Manager
Customer Segments
- 48 -
The Indian mutual fund industry is going through a phase of

transformation since liberalization. Liberalization has opened the way for foreign
investors in the mutual fund. This has increased the pace of evolution in the industry.
Institutional investors dominate the industry. They hold majority of the Indian mutual
fund assets, whereas retail investors account for small portion of total asset under
management. The low penetration among the retail investors can be attributed to their
lack of awareness and risk-aversion attitude.
Individual Agents
Indian mutual fund market is greatly depends on retail investors. For such
purpose, mutual fund companies appoint the distributors whose main target segment
would be retail investors. However, they are also having High Net worth Individuals
(HNI). All the distributors have to clear their AMFI examination conducted by
Association of Mutual Funds in India (AMFI) to become a Certified AMFI distributor.
Public Sector mutual funds like LIC MF and UTI have an edge over others due to
their well-established agency network. Distributors/Agents have their own investors’
universe and they always try to make the new investors. The Distributors frequently
arrange the meetings or get together for investors to aware about the schemes offered by
the mutual fund and aware about the benefits that one can derived from it. The main
purpose for arranging these types of meetings is to maintain the good relationship with
investors in today’s competitive financial market. To unload their work, the companies
bear huge market expenses in the form of higher commission to lure the investors.
The distribution can also be made by using lead managers and brokers along with
sub-brokers for selling units.
• BANKS AND NBFC
- 49 -
Till the early 1990s, the stockbrokers, sub-brokers and agents were the mainstay
of fund sales. Lack of professionalism in this method of sales led to the adoption of new
channels of distribution such as banks and Non-banking Financial Corporation. UTI is
distributing its offerings through selected branches of the Indian bank, Corporation bank,
Bank of India and Allahabad Bank.
Today, private sector banks are also promoting mutual funds through their
distribution channel. These banks have their own mutual fund section in bank itself and
two or three executives are delegated to meet the investors, educate them and sell their
products.
Large Distribution House
Apart from banks and other retail distributors, the large distribution companies
like NJ India Invest are also in the ground to promote the mutual fund schemes. An agent
is essential channel between investors and mutual fund products. However, it is difficult
for AMCs to manage and monitor a large agent force. So, they take shelter in third party
distribution companies. These houses appoint their agents to sell the Mutual fund
schemes. These houses focus on financial products like insurance, dematerialization,
PPF, Post office savings like NSC/KVP, FD, and Govt. Securities etc. Moreover, they
have a large prospectus for investors and they provide the excellent facilities to investors
in terms of awareness of new schemes, market tips for investing etc. This results into
large mobilization of funds in the market ultimately which helps to mutual fund
companies.
• Institutional Agents/Brokers
The Corporate segment is one of the more lucrative for mutual fund companies.
Earlier, we have discussed about institutional investor that they dominate the industry and
hold about 65% of the Indian mutual fund assets. To get the tax benefits and capital
- 50 -
appreciation, the corporate clients are more interested to choose their regular investment
vehicle as Mutual fund.
The distribution channel of NJ India Invest is somewhat like the general process.
It goes on in various different channels. The channels are:
Data Collection:
Data is collected from various different sources like internet, trainee surveys,
present employee reference, walk- in and different surveys conducted by the company
itself. This data is preserved in a systematic way and is used as and when required. Data
collections plays a very important role in the distribution channel because one a client is
made ready to join NJ the process starts.
Meeting:
After the data has been collected, the people who are interested in becoming
advisors are called for a meeting. Here they are given information about what is mutual
fund? How to invest in it and various questions related to financial products. Any queries
by the people interested are cleared here in this meeting.
Value Pack:
After the meeting is over the clients actually interested are given the value pack. It
contains the enrollment process and certain rules and requirements. At NJ the enrollment
is around Rs. 4000. Here information regarding the AMFI exam is also given.
Opportunity forecasting:
The advisor at NJ then forecasts the opportunities from the market and explains
opportunity in the meeting to the interested people.
Training:
- 51 -
Training at NJ is given by NJ Gurukul; they train the clients for the AMFI test
which is necessary to clear to become a mutual fund advisor. The clients are trained and
given all the information about the test and various methods to clear it easily.
- 52 -
Data Collection
Meeting
Opportunity Forecasting
Value Pack
AMFI Training
AMFI Exam
If passed Not Cleared
NJ partner enrollment form
Client Acquisition Small meet
Joint Call
Training of advisors
- 53 -
AMFI Exam:
All the people who want to be a mutual fund advisor have to clear this test. It is a
computerized test which contains basic questions about mutual funds and its market. One
goes to the next stage only after clearing this stage. Or else he again has to go back to the
training stage.
NJ Partners:
After clearing the test all the clients are given NJ enrollment form. They are now
made NJ partners.
Client Acquisition:
Client acquisition is divided into two major parts:
1. Small Meets
2. Joint Calls
1. Small Meets:
Small meets includes meeting with the employees, discussing with them the
market situation and the major stocks to be invested.
2. Joint Class:
When the in charge and the advisors go and meet the partner in order to convince
him/her to join and invest with NJ, these small meeting are called joint calls.
Training of advisors:
The advisors are given product training and they communicate new information in
this training. They also discuss about regular business development. The advisors are
encouraged to get new clients and help them to be well versed with the new and
changing situation.
- 54 -
4.1 HUMAN RESOURCE MANAGEMENT:

“Human Resource Management may be defined as a set of policies, practices and
programs designed to maximize both personal and organizational goals.”
It is the process of binding people and organizations together so that the objectives of
each are achieved.
Organizational Objectives and Goals
- 55 -
4.2 HUMAN RESOURCE DEPARTMENT:
Activities of Human Resource Department:-
Human Resource activity is the heart of the company, any company cannot work
without HR department because they provide the manpower to company and without
them the firm can’t operate.
The activities conducted by HR Department are:-

1. They conduct the recruitment and selection process on basis of certain criteria.
2. Human Resource Planning is done by them for recruiting candidates for company,
3. The also provide training, transfer and employee welfare.
4. They also supervise the work done by candidates or workers in the company.
- 56 -
- 57 -
4.3 HIERACHY OF HR DEPARTMENT:
- 58 -
4.4 RECRUITMENT AND SELECTION:
Recruitment:
“Recruitment is the process of searching for prospective employees and

stimulating and encouraging them to apply for jobs in an organization.”
Selection:
“Selection is the process of choosing the most suitable persons out of all the
applicants.”
“Selection is the process of matching the qualifications of applicants with the job
requirements.”
General Process of Recruitment & Selection:-

1. Recruitment process generally begins when the human resource department
receives requisitions from any department of the company. The human resource
requisitions contain details about the position to be filled, number of persons to be
recruited, the duties to be performed, qualifications required from the candidate,
terms and conditions of employment and the time by which the person should be
available for appointment, etc.
2. Locating and developing the sources of required number and type of employees.
3. Identifying the prospective employees with required characteristics.
- 59 -
4. Communicating the information about the organization, the job and the terms and
condition of service.
5. Encouraging the identified candidates to apply for jobs in the organization.
6. Evaluating the effectiveness of recruitment process.
The process which NJ’s follows for its recruitment and selection is:
- 60 -
4.5 HUMAN RESOURCE PLANNING:
“Human Resource Planning has been defined as the process by which

management determines how an organization should move from current manpower
position to its desired manpower position.”
“HRP includes the estimation of how many qualified people are necessary to
carry out the assigned activities, how many people will be available & what if
anything must be done to ensure that personnel supply equals personnel demand at
the appropriate point in the future.”
“HRP is the process by which originations ensure that it has the right number
& kind of people, at the right place, at the right time, capable of effectively & efficiently
completing those tasks that will help the organization achieve its overall objectives. HRP
translates the organizations’ objectives & plans into the number of workers needed to
meet those objectives. Without a clear-cut planning estimation of an organizations’ need
is reduced to mere guesswork”
HRP is the system matching supply & demand of manpower.
- 61 -
Candidates required = Current manpower – Attrition + Shortfall
Process of HRP:-
Organizational goal
Strategies
Forecasting the personal

(HRP)
Demand of Supply of
personal personal
HR Programming
HR Implementation
- 62 -
Surplus Deficit
4.6 TRAINING AND DEVELOPMENT:
Every individual who is selected for the job needs the training. Without getting
training it is not easy for the individual to perform the job accurately and the precisely.
He should be given at least the basic knowledge with the help of which he can carry out
his work. Therefore, training is a must for each and every employee working in the
organization. It helps the employees to get the basic facts of their jobs and the working
environment under which they are supposed to perform their duties.
“Training is the process of increasing knowledge and skills for doing a particular
job.”
“Training is the process by which the aptitudes, skills and abilities of employees to
perform specific jobs are increased.”
 NJ analyse employees requirement for training time to time.
 They also share views of employees.
 They take actions against weakness, limitations and shortcoming of the

employees.
- 63 -
- 64 -
Training and development of NJ depends upon following factors:-
- 65 -
Development:
“Development is a long term process utilizing a systematic and organized

procedure by which managerial personnel learn conceptual and theoretical knowledge for
general purpose.”
Training and development:
- 66 -
4.7 PROMOTION AND TRANSFER:
Promotion:-
“Promotion refers to advancement of an employee to a higher post carrying

greater responsibilities, higher stats and better salary. It is the upward movement of an
employee in the organization’s hierarchy, to another job commanding greater authority,
higher status and better working conditions.”
Promotion means an improvement in pay, prestige, position and responsibility of

an employee within his or her organization.
In promotion the salary of the workers is raised according to his efficiency.

In NJ the promotion is given on the basis of performance as well as experience basis.
Some of the factors which influence the promotion are his post records, person’s
behavior, his interview report, job knowledge etc.
The company follows the seniority basis for promotion because the seniors are
usually more experienced and the young people may get the chance for gaining more
knowledge, skills etc.
Promotion is also based on the performance of employees.

Performance of employees is divided into grades:-
A, B, C, D.
For example
A means Employee working for 5 years continuously
- 67 -
Transfer:
“A transfer refers to horizontal movement of an employee from one job to another

in the same organization without any significant change in status and pay.”
There are very less cases of transfer in the office its more at the factory.
Conditions for transfer
When an employee had joined for a specific department at that time there was no
vacancy in that department, slowly it was observed that he works better than the person
currently working in that department so he can be transferred to this respective
department of higher productivity.
• Necessity of manpower at the work place.

• Employee’s personal need, due to personal problems and preferences.
Some other reasons are:-

• Transfer is also done after 1 target is settled by the employee.
• Sometimes transfer is done to punish the employees.
• If an employee is not efficient in some department, he is transferred to the

department where he can work efficiently.
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4.8 PERFORMANCE APPRAISAL:

“Performance Appraisal is the process of assessing the performance and progress
of an employee or of a group of employees on a given job and his potential for future
development.”
Performance appraisal is also useful in providing proper guidance to the
employees who are potential of success and require a bit of guidance. Human resource is
the most valuable asset for any organization; every firm does a huge investment in it and
believes that the value, which human asset can increase in them, is much more than any
other asset.
 Process of Performance Appraisal
1. Job Analysis, Job Description and Job Specification
2. Establishing Standards of Performance
3. Communicating Performance Standards to Employees
4. Measuring Actual Performance
5. Comparing Actual Performance with Standards and Discussing the Appraisal with
Employees
6. Initiating Corrective Action, if any.
 In NJ performance appraisal grades are given to workers according to the work

done by them. This process is done at the end of financial year.
Online appraisal is also done in NJ.
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4 kinds of appraisal are done:

• Self appraisal
• Immediate/Review officer
• Superior
• Management
This means that 1st employee has to rate himself.

Secondly, a review officer approves or disapproves it within 3 days.
Thirdly, decision is carried on to the superiors and they also take decision
within 3 days whether to approve or disapprove he appraisal within 3 days
and
Finally the decision of appraisal is taken by the management in 3 days.
Totally approximately 9 to 10 days are undertaken for this process.
The employee’s appraisal is finally done in the following grades:-
A Excellent
B Very Good
C Good
D Poor
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4.9 SALARY AND WAGES:

“Wage is derived from words which suggest "making a promise," which is
often used in monetary form. Specifically from the Old French
word “wagier” or “gagier” meaning to pledge or promise, from which the money placed
in a bet (wager) also derives.”
“A salary is a form of periodic payment from an employer to an employee, which

may be specified in an employment contract. It is contrasted with piece wages, where
each job, hour or other unit is paid separately, rather than on a periodic basis.”
From the point of a view of running a business, salary can also be viewed as the
cost of acquiring human resources for running operations, and is then termed personnel
expense or salary expense. In accounting, salaries are recorded in payroll accounts.
Wages represent the hourly rates of pay and salary refers to the monthly rate of
pay, irrespective of the number of hours put in by an employee. Wages and salaries are
subject to annual increment. The wages differ from employee to employee and it also
depends on the nature of the job, seniority and merits. On the other hand we can define
salary as the amount of money paid to an employee monthly or yearly.
Two copies of the pay slip are maintained. One is given to the employee and the other is
kept by the company for its records.
NJ has divided cities and has given grades to different cities. Grades are allotted in this
way.
A+ Delhi and Mumbai
A Ahmedabad, Pune, Bangalore and Chennai
B Surat, Valsad and Vapi
C Others
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Hierarchy structure of salary is as following:
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4.10 EMPLOYEE WELFARE:

“The efforts to make life worth living for workmen are known as
employee welfare.”
“Anything done for the comfort and improvement, intellectual or social, of the
employees over ad above the wages paid which is not a necessity of the industry.
Types of Welfare Services:
Intramural:
These services are provided within the establishment. These include

latrine and urinals, washing and bathing facilities, crèches, rest shelters, canteens,
uniform, medical aid, library, recreation facilities, free or subsidies food, etc.
Extramural:
These services are provided outside the establishment. These consist of

housing accommodation, transport, maternity benefits, children’s education,
sports fields, family planning and welfare, holiday homes, leave travel facility,
workers cooperative stores, fair price shops, credit societies, vocational guidance,
interest free loan, etc.
 Nothing can be done without employees. Even though a firm has a lot of
investment ready or full tech new machines they are of no use if the
employees are not well or not willing to work all this technology will be of
no use. It is very necessary to keep your employees happy and motivated
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in order to get the maximum skills out of them. So employee welfare is

very necessary in any firm.
 Some of the facilities given by NJ India Invest are:
1. Mediclaim:
Mediclaim policy is a financial agreement wherein the insurer promise to
pay the amount which is spent by the insured for his health purpose during
hospitalization. NJ provides its employees the mediclaim policies.
2. Blood Donation Camps:

NJ arranges blood donation camps for its employees.
3. Plantation:
NJ Also believes in helping the society and upliftment of it. It brings out
the campaign of tree planting every year. This builds up the moral of the
employees as they have the feeling that NJ is helping of clean up the society.
4. Magazine:
A monthly magazine is issued to all the employs of the firm. This

magazine tells about the different market conditions and the things prevailing
in the market. It also tells about the different social work done by the
employees. So this makes the employee feel at home and motivates them to
keep the flag of their firm ever rising.
5. NJ Connect Bog:
Blog is a very new and mainly use by the Modern world today. NJ also
provides each employee with an employee user ID and password. Here the
employee gets an opportunity to connect with other employees; this gives them
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the feeling of unity. Here the employee with extra ordinary work is also
recognized.
6. Gym:
It is very necessary that the employee has to be physically fit in order to

work enthusiastically. For this NJ provides their employees with a Gym in their
office so that an employee can work out while he is having a break.
7. Canteen:
For motivation of employees NJ provides its staff with an excellent and

hygienic canteen. Here the employees can interact with other employees during lunch
breaks and create a friendly atmosphere. Here employee’s birthday and any special
occasions are also celebrated here.
8. Library:
NJ has a library consisting of different range of books which are related to
their work, and other books like novels, encyclopedia etc are available. Its library
also consists of past NJ records, projects from trainees, NJ books available for
marketing, annual reports etc.
9. Annual function:
Every year NJ organizes Annual Function for their employees. It is a
motivating tool for the employees. Employees with outstanding performance are
given awards and are recognized.
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4.11 ABSENTEEISM RATE:

There is no exact rate of absenteeism in organization. Absenteeism rate depends
upon employees leave. While estimating demand for manpower, the prevailing rate of
absenteeism in the company should be considered.
“Frequency of employees failing to report to work when they are scheduled to

do so is known as absenteeism rate. An absence rate above 5 percent is considered
high.”
NJ grants different kinds of leave:

1. Privilege leave 15 days
2. Sick leave 9 days
3. Maternity leave 12 weeks +1
4. Paternity leave 3 days
5. Advance leave (extraordinary) 1 day
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4.12 EMPLOYEES TURNOVER:

“Employee turnover ratio means in the year how many new employees recruited
and how many left the job.”
Employee turnover is a ratio comparison of the number of employees a company

must replace in a given time period to the average number of total employees. A huge
concern to most companies, employee turnover is a costly expense especially in lower
paying job roles, for which the employee turnover rate is highest. Many factors play a
role in the employee turnover rate of any company, and these can stem from both the
employer and the employees. Wages, company benefits, employee attendance, and job
performance are all factors that play a significant role in employee turnover.
Companies take a deep interest in their employee turnover rate because it is a

costly part of doing business. When a company must replace a worker, the company
incurs direct and indirect expenses. These expenses include the cost of advertising,
headhunting fees, human resource costs, loss of productivity, new hire training, and
customer retention -- all of which can add up to anywhere from 30 to 200 percent of a
single employee's annual wages or salary, depending on the industry and the job role
being filled.
In over all financial industry employment turnover is 10-15%.
Employees turnover of NJ’s is quite low than any other in this industry. It’s less
than 1%. And total manpower in NJ is around 5000.
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4.13 HUMAN RESOURCE AUDIT:

“Human Resource Audit involves examination and verification of accounts and
records of human resource. Human resource audit implies critical examination and
evaluation of policies, programs and procedures in the area of human resource
management.”
It is the periodic review to measure effectiveness of human resource management and

to determine the steps required for more effective use of human resources.
Human Resource Audit is carried on by the appointed inspector who inspects the
work done by all workers. He pays special attention on every worker from the lowest post
to highest post.
This inspector evaluates the worker’s performance, his working time and over
time done by an employee.
 Benefits of HR Audit:
It provides the various benefits to the organization. These are:
• It helps to find out the proper contribution of the HR department towards the
organization.
• Development of the professional image of the HR department of the organization.
• Reduce the HR cost.
• Motivation of the HR personnel.
• Find out the problems and solve them smoothly.
• Provides timely legal requirement.
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• Sound Performance Appraisal Systems.
• Systematic job analysis.
At NJ an inspector is appointed to do human resource audit. He checks that all the

employees are paid on time. Their attendance and overtime is checked by the inspector
and feedbacks are given accordingly. He also sees that all the different branches of NJ are
S&E registered, all the employees are give ESI (employee State Insurance) or not.
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5.1 OPERATIONS MANAGEMENT:

Operations management is an area of business concerned with the production of
goods and services, and involves the responsibility of ensuring that business operations
are efficient in terms of using as little resource as needed, and effective in terms of
meeting customer requirements. It is concerned with managing the process that converts
inputs (in the forms of materials, labour and energy) into outputs (in the form of goods
and services).
Operations traditionally refer to the production of goods and services separately,

although the distinction between these two main types of operations is increasingly
difficult to make as manufacturers tend to merge product and service offerings. More
generally, Operations Management aims to increase the content of value-added activities
in any given process. Fundamentally, these value-adding creative activities should be
aligned with market opportunity (see Marketing) for optimal enterprise performance.
According to the U.S. Department of Education, Operations Management is the

field concerned with managing and directing] the physical and/or technical functions of a
firm or organization, particularly those relating to development, production, and
manufacturing. [Operations Management programs typically include] instruction in
principles of general management, manufacturing and production systems, plant
management, equipment maintenance management, production control, industrial labor
relations and skilled trades supervision, strategic manufacturing policy, systems analysis,
productivity analysis and cost control, and materials planning.
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5.2 ACTIVITIES OF OPERATIONS

DEPARTMENT:
The activities of the operations department are spread over the five segments of
N.J. India.
Those segments are:-
1. Mutual funds
2. Insurance
3. Real estate
4. Fixed deposits
5. Portfolio management service
MUTUAL FUNDS:
TRANSACTION:
Over here, the person has to fill the form which consist all the details of the type
of mutual fund, the amount which he is willing to invest, the name of the mutual fund and
other things like bank A/C details, address proof and the like.
Care should be taken that all the details are filled properly and without mistake.
PURCHASE:
After transactions take place, those forms are sent to AMC’s where again the form
details are scanned and are sent to the head quarter. At the head quarter the details sent by
the AMC is checked with the details of the employees of operations department. If any
deviations found, they are checked and corrected.
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SYSTEMATIC INVESTMENT PLAN (SIP):

After the procedure of purchasing gets complete, the most crucial thing is to
decide in which company’s mutual fund you want to invest and in how much proportion?
The proportion is decided by the investor himself.
SWITCH:
Switch means transfer of the money from one type of mutual fund to another type
of mutual fund. This can be done by the N.J. or by the investor. The main purpose of
doing such thing is to maximize “money” invested. Switch mainly occurs when the other
type of mutual fund is yielding more profits.
REDEMPTION:
Redemption means that the investor withdraws all his money from the N.J. India
Invest. Redemption occurs when the period of the money invested in any mutual fund has
come to an end. The maturity date of that mutual fund has come. This may also be done
because he no more wants to invest his money in mutual funds for some time, May he is
satisfied with the profit he has earned.
SYSTEMATIC TRANSFER PLAN (STP):

This means that the money invested in one type of mutual fund can be transferred
to another type of mutual funds also. For example it can be transferred to textile industry
to IT industry.
SYSTEMATIC WITHDRAWAL PLAN (SWP):

A systematic withdrawal plan is a financial plan that allows a shareholder to
withdraw money from an existing mutual fund portfolio at predetermined intervals. The
money withdrawn through a systematic withdrawal plan can be reinvested in another
portfolio or used to pay for something else. Often, a systematic withdrawal plan is used to
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funds expenses during retirement. However, this type of plan may be used for other
purposes as well.
INSURANCE:
Insurance sector came into existence in October 2009 and is carried on under the
name of H.M.LOGISTICS Pvt. Ltd. As it’s not registered in the list of IRDA, they can
sell the insurance policies of one firm only. For this they selected I.C.I.C.I. The main
reason for selecting I.C.I.C.I is because they are market leaders, brand equity is good,
N.J. is the beginner and they are experienced, their fund management is good.
N.J. is having 150 partners till now for insurance and was 4th highest in I.C.I.C.I in
making profits in its 1st quarter only.
REAL ESTATE:
Stocks from firms involved in real estate such as builder, supplier, architects and
engineers, financial lenders, etc.
PORTFLIO MANAGEMENT SERVICES (PMS):

Portfolio Management Services (PMS) is a sophisticated investment vehicle that
offers a customized investing into stocks, fixed income products, cash, other structured
products and mutual funds units etc. to meet specific investment objectives. Though,
PMS is managed by a professional managers, it has potential to address the personal
preferences tailored into the investment portfolio giving the freedom and flexibility
required for achieving the financial goals.
FIXED DEPOSITS:
Company Fixed Deposit is a fixed deposit scheme offered by a company. It works
similar to a bank deposit where you earn interest income. Company FDs offer much
higher returns than bank FDs, since they entail higher risks. The higher the risk, the
higher is the interest rate offered. Furthermore, company fixed deposits are 'unsecured'.
This means, you have no lien on the assets of company, in case it goes into financial
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difficulties and is wound up. Hence, it is of utmost importance to obtain professional

financial advice with regards to Company Fixed Deposit.
RETURNS OFFERED BY COMPANY’S FIXED DEPOSIT:
Returns offered by Company fixed deposits are higher compared to the Bank FD.
However, higher the return, higher is the risk. Hence, be careful before choosing a
company with say a 15 per cent coupon rate as against one with 11 per cent coupon.
While the higher return may be tempting, the safety may be lower.
Before investing you can also check for the rating given to the Company FD and
also the past track record of making timely interest payments.
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5.3 SERVICE OPERATION:
At service operation centre at N.J. India Invest, queries of the customers are
solved.
The activities carried at the service operation department at N.J. India invest are
as follows:
The data sent by the employees of the operation department to the head quarter
and to the AMC’s are checked. If any, deviations are found out, then are verified and the
mistakes are corrected.
It is being checked that the customers has filled the form properly and have given
each and every minute details needed by N.J. If not then they are guided by our
employees to do so. Which includes checking of pan card, address proof, etc.
The customers are even given one customer service no. by calling on which they
can solve their queries and can get answers for their questions.
All kinds of problems related to the “paper work” are solved by the service department.
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5.4 JOB DESIGN:
Work arrangement (or rearrangement) aimed at reducing or overcoming job

dissatisfaction and employee alienation arising from repetitive and mechanistic tasks.
Through job design, organizations try to raise productivity levels by offering non-
monetary rewards such as greater satisfaction from a sense of personal achievement in
meeting the increased challenge and responsibility of one's work. Job enlargement, job
enrichment, job rotation, and job simplification are the various techniques used in a job
design exercise
Job design refers to the way that a set of tasks, or an entire job, is organized. Job
design helps to determine:
o What tasks are done,

o How the tasks are done,
o How many tasks are done, and
o In what order the tasks are done.
It takes into account all factors which affect the work, and organizes the content and
tasks so that the whole job is less likely to be a risk to the employee. Job design involves
administrative areas such as:
o Job rotation,
o Job enlargement,
o Task/machine pacing,
o Work breaks, and
o Working hours.
A well designed job will encourage a variety of 'good' body positions, have
reasonable strength requirements, require a reasonable amount of mental activity, and
help foster feelings of achievement and self-esteem.
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JOB DESIGN PRINCIPLES CAN ADDRESS PROBLEMS SUCH AS:
o Work overload,
o Work under load,
o Repetitiveness,
o Limited control over work,
o Isolation,
o Shift work,
o Delays in filling vacant positions,
o Excessive working hours, and
o Limited understanding of the whole job process.
Job design is sometimes considered as a way to help deal with stress in the workplace.
See the OSH Answers document "Workplace Stress - General" for more information.
IS THERE A DIFFERENCE BETWEEN JOB DESIGN AND

WORKPLACE DESIGN?
Job design and workplace design are often used interchangeably because both
contribute to keep the physical requirements of a job reasonable.
Job design refers to administrative changes that can help improve working
conditions.
In comparison, workplace design concentrates on dealing with the workstation,

the tools, and the body position that all influence the way a person does his or her work.
Good workplace design reduces static positions, repetitive motions and awkward body
positions. More information on workplace design is available in the Ergonomics - Human
Factors section of OSH Answers.
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WHAT ARE FEATURES OF "GOOD" JOB DESIGN?
Good job design accommodates employees' mental and physical characteristics by

paying attention to:
o Muscular energy such as work/rest schedules or pace of work, and

o Mental energy such as boring versus extremely difficult tasks.
Good job design:
o Allows for employee input. Employees should have the option to vary activities
according to personal needs, work habits, and the circumstances in the workplace.
o Gives employees a sense of accomplishment.
o Includes training so employees know what tasks to do and how to do them
properly.
o Provides good work/rest schedules.
o Allows for an adjustment period for physically demanding jobs.
o Provides feedback to the employees about their performance.
o Minimizes energy expenditure and force requirements.
o Balances static and dynamic work.
Job design is an ongoing process. The goal is to make adjustments as conditions

or tasks change within the workplace.
WHAT ARE COMMON APPROACHES TO JOB DESIGN?
Achieving good job design involves administrative practices that determine what
the employee does, for how long, where, and when as well as giving the employees
choice where ever possible. In job design, you may choose to examine the various tasks
of an individual job or the design of a group of jobs.
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APPROACHES TO JOB DESIGN INCLUDE:
• Job Enlargement:
Job enlargement changes the jobs to include more and/or different tasks. Job
enlargement should add interest to the work but may or may not give employees more
responsibility.
• Job Rotation:
Job rotation moves employees from one task to another. It distributes the group
tasks among a number of employees.
• Job Enrichment:
Job enrichment allows employees to assume more responsibility, accountability,

and independence when learning new tasks or to allow for greater participation and new
opportunities.
• Work Design (Job Engineering):
Work design allows employees to see how the work methods, layout and handling
procedures link together as well as the interaction between people and machines.
GOALS OF JOB DESIGN:-
Goals can be in many difference areas and include:
1. Task Variety :
To alleviate boredom, avoid both excessive static body positions and repetitive
movements. Design jobs to have a variety of tasks that require changes in body position,
muscles used, and mental activities.
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Two methods are job enlargement and job rotation. For example, if an employee
normally assembles parts, the job may be enlarged to include new tasks such as work
planning, inspection / quality control, or maintenance. Alternatively, the tasks may
include working in the same department, but changing tasks every hour. For example, in
a laundry facility employees can rotate between various stations (sorting, washer, dryer,
iron, etc) as long as it provides for a change in physical or mental expenditure.
2. Work Breaks / Rest Breaks :
Rest breaks help alleviate the problems of unavoidable repetitive movements or

static body positions. More frequent but shorter breaks (sometimes called "micro breaks")
are sometimes preferable to fewer long breaks.
During rest breaks, encourage employees to change body position and to exercise. It
is important that employees stretch and use different muscle groups. If the employee has
been very active, a rest break should include a stationary activity or stretching.
3. Allowance for an Adjustment Period:
When work demands physical effort, have an adjustment period for new
employees and for all employees after holidays, layoffs, or illnesses. Allow time to
become accustomed to the physical demands of work by gradually "getting in shape."
Employees who work in extreme hot or cold conditions also need time to acclimatize.
4. Provide Training:
Training in correct work procedures and equipment operation is needed so that

employees understand what is expected of them and how to work safely. Training should
be organized, consistent and ongoing. It may occur in a classroom or on the job.
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5. Vary Mental Activities :
Tasks should be coordinated so that they are balanced during the day for the
individual employee as well as balanced among a group of employees. You may want to
allow the employee some degree of choice as to what types of mental tasks they want to
do and when. This choice will allow the employee to do tasks when best suited to their
'alertness' patterns during the day. Some people may prefer routine tasks in the morning
(such as checklists or filling in forms) and save tasks such as problem solving until the
afternoon, or vice versa.
CAN I USE JOB DESIGN FOR TEAMS?
Yes. Since most tasks are not done in isolation, job design is very often used for a
group of employees. In some cases, teams can be created that have an overall
responsibility for larger task or set of tasks. It is up to the team to decide how the job will
be accomplished, which individual will do what tasks, and when. In most cases, team
members will have many skills which allow them to change jobs from time to time. As
with job design for individuals, additional opportunities such as inspection / quality
control, maintenance, and related tasks such as ordering supplies are often assigned to the
team in addition to their regular tasks.
WHAT STEPS SHOULD I TAKE WHEN CARRYING OUT A JOB

DESIGN PROJECT?
Although there are many ways to carry out job design, the following stages are essential:
1. DO AN ASSESSMENT OF CURRENT WORK PRACTICES.
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Is job design needed or feasible? Discuss the process with the employees and
supervisors involved and are clear about the process or any changes or training that will
be involved.
2. DO A TASK ANALYSIS.
Examine the job and determine exactly what the tasks are. Consider what
equipment and workstation features are important for completing the tasks. Identify
problem areas.
3. DESIGN THE JOB.
Identify the methods for doing the work, work/rest schedules, training
requirements, equipment needed and workplace changes. Coordinate the different tasks
so each one varies mental activities and body position. Be careful not to under or
overload the job.
4. IMPLEMENT THE NEW JOB DESIGN GRADUALLY.
You may want to start on a small scale or with a pilot project. Train employees in
the new procedures and use of equipment. Allow for an adjustment period and time to
gain experience with the new job design.
5. RE-EVALUATE JOB DESIGN ON A CONTINUAL BASIS.
Make any necessary adjustments.
You may also want to establish a committee to represent the various groups
involved. Job design should involve employees, unions, the health and safety committee
and managers during the entire process. Participation of all parties increases
communication and understanding.
Be clear that purpose of the job design is to strengthen the operations and its workforce,
not to eliminate jobs or sets of skills.
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THE JOB DESIGN FOLLOWED BY N.J. INDIA IS AS FOLLOWS:
• ZONE MANAGER:
In N.J., there are zone managers for every zone. The whole responsibility
of the every zone lies with the managers of the respective zone. In N.J., there are
five zones. Like north, south, east, west and Mumbai. These zone managers work
according to the goals and objectives set by N.J. India invest.
• REGIONAL MANAGER:
Under every zone manager, there works regional manager. For example; in
north zone, different regional managers will work under the north zone manager. Like
regional managers of Delhi, Chandigarh, Punjab, etc. will work under the north zone
manager.
• BRANCH MANAGER:
In every region, there are several branches of N.J. Every branch has its own
manager. These branch managers will work under the regional managers.
• RELATIONSHIP MANAGERS:
Now in every branch there are people working for the N.J. These people are
called relationship manager. They communicate with the public and work according
to the rules and instructions of the respective branch manager.
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5.5 Process Design:

Process design is the method by which an organization understands and defines
the operation activities that enable it to function. Process designs is concerned with
designing an operation processes to ensure that they are optimized, effective, meet
customer requirements, support and sustain organizational development and growth. A
well-designed process will improve efficiency and deliver greater productivity while an
inefficient process leads to poor communication, duplication of effort, functional barriers
and delays, unnecessary costs (money, materials and manpower) and, ultimately, an
output that either partially or wholly fails to achieve its designated purpose.
“No matter how hard individuals work, they cannot overcome a flawed process
design, much less the burden of no design at all.” (Michael Hammer)
Three core element in process design activity in operation management:

1. Layout & Flow
2. Process Technology
3. Job Design and Work Organization
The process designs followed by N.J. India invest is as follows:
Firstly, there are number of companies in AMC (Asset Management Company)

like reliance, S.B.I., I.C.I.C.I.; etc. We here at N.J. are having the mutual funds of all the
company’s with different AMC’S registered with us. The clients are given various
options and schemes to invest their money.
The client then selects the
There are so many public and private sector companies in the market. These
public and private sector companies run on a huge scale with a huge amount of capital
investment. Therefore, due to their big scale business, they often need money to finance
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their business. Every time, they can’t go to the banks or issue shares for the company to
get the required capital.
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5.6 PROJECT PLANNING AND CONTROL
PROJECT PLANNING:
Project planning includes all activities that results in a course of action for a
project. Planning begins with the setting well defined objectives. Also, planning involves
decisions regarding the resources to be committed, completion times, priorities of
activities, etc. Areas of responsibility must be identified and assigned. Time and resource
requirements to perform the work activities must be forecasted and budgeted. Planning
also involves establishing project boundaries and identifying controllable and
uncontrollable variable that must be managed. Also the performance criteria should be
stated related to the project objectives and in measures of time, cost and quality
characteristics.
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PLANNING SCHEDULING:
Planning scheduling establishes times and sequences of the various phases of the
project. In project scheduling, the project manager considers the various activities of an
overall project and the tasks that must be accomplished and relates them to one another
over the projects time horizon.
Techniques for scheduling projects include Gantt charts and network techniques
such as PERT and CPM.
PROJECT CONTROL:-
Project controls are activities designed to measure the status of competent
activities of a project, transmit data to a control centre where it is compared with the
performance standard and initiate corrective action when required.
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5.7 TOTAL QUALITY MANAGEMENT:-
Total Quality Management is an approach to the art of management that

originated in Japanese industry in the 1950's and has become steadily more popular in the
West since the early 1980's.
TQM is a set of management practices throughout the organization, geared to

ensure the organization consistently meets or exceeds customer requirements. TQM
places strong focus on process measurement and controls as means of continuous
improvement.
Total Quality is a description of the culture, attitude and organization of a

company that aims to provide, and continue to provide, its customers with products and
services that satisfy their needs. The culture requires quality in all aspects of the
company's operations, with things being done right first time, and defects and waste
eradicated from operations.
Some useful messages from results of TQM implementations:
o If you want to be a first-rate company, don't focus on the second-rate

companies who can't handle TQM, look at the world-class companies that
have adopted it
o The most effective way to spend TQM introduction funds is by training top
management, people involved in new product development, and people
involved with customers
o It's much easier to introduce EDM/PDM in a company with a TQM culture
than in one without TQM. People in companies that have implemented TQM
are more likely to have the basic understanding necessary for implementing
EDM/PDM. For example, they are more likely to view EDM/PDM as an
information and workflow management system supporting the entire product
life cycle then as a departmental solution for the management of CAD data
- 102 -
IMPORTANT ASPECTS OF TQM INCLUDE:-
1. CUSTOMER-DRIVEN QUALITY:
TQM has a customer-first orientation. The customer, not internal activities and
constraints, comes first. Customer satisfaction is seen as the company's highest priority.
The company believes it will only be successful if customers are satisfied. The TQM
Company is sensitive to customer requirements and responds rapidly to them. In the
TQM context, `being sensitive to customer requirements' goes beyond defect and error
reduction, and merely meeting specifications or reducing customer complaints. The
concept of requirements is expanded to take in not only product and service attributes that
meet basic requirements, but also those that enhance and differentiate them for
competitive advantage.
Each part of the company is involved in Total Quality, operating as a customer to some
functions and as a supplier to others. The Engineering Department is a supplier to
downstream functions such as Manufacturing and Field Service, and has to treat these
internal customers with the same sensitivity and responsiveness as it would external
customers.
2. TQM LEADERSHIP FROM TOP MANAGEMENT :
TQM is a way of life for a company. It has to be introduced and led by top
management. This is a key point. Attempts to implement TQM often fail because top
management doesn't lead and get committed - instead it delegates and pays lip service.
Commitment and personal involvement is required from top management in creating and
deploying clear quality values and goals consistent with the objectives of the company,
and in creating and deploying well defined systems, methods and performance measures
for achieving those goals. These systems and methods guide all quality activities and
encourage participation by all employees. The development and use of performance
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indicators is linked, directly or indirectly, to customer requirements and satisfaction, and

to management and employee remuneration.
3. CONTINUOUS IMPROVEMENT:
Continuous improvement of all operations and activities is at the heart of TQM.

Once it is recognized that customer satisfaction can only be obtained by providing a high-
quality product, continuous improvement of the quality of the product is seen as the only
way to maintain a high level of customer satisfaction. As well as recognizing the link
between product quality and customer satisfaction, TQM also recognizes that product
quality is the result of process quality. As a result, there is a focus on continuous
improvement of the company's processes. This will lead to an improvement in process
quality. In turn this will lead to an improvement in product quality, and to an increase in
customer satisfaction. Improvement cycles are encouraged for all the company's activities
such as product development, use of EDM/PDM, and the way customer relationships are
managed. This implies that all activities include measurement and monitoring of cycle
time and responsiveness as a basis for seeking opportunities for improvement.
Elimination of waste is a major component of the continuous improvement approach.

There is also a strong emphasis on prevention rather than detection, and an emphasis on
quality at the design stage. The customer-driven approach helps to prevent errors and
achieve defect-free production. When problems do occur within the product development
process, they are generally discovered and resolved before they can get to the next
internal customer.
4. FAST RESPONSE:
To achieve customer satisfaction, the company has to respond rapidly to customer

needs. This implies short product and service introduction cycles. These can be achieved
with customer-driven and process-oriented product development because the resulting
simplicity and efficiency greatly reduce the time involved. Simplicity is gained through
concurrent product and process development. Efficiencies are realized from the
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elimination of non-value-adding effort such as re-design. The result is a dramatic

improvement in the elapsed time from product concept to first shipment.
5. ACTIONS BASED ON FACTS:
The statistical analysis of engineering and manufacturing facts is an important

part of TQM. Facts and analysis provide the basis for planning, review and performance
tracking, improvement of operations, and comparison of performance with competitors.
The TQM approach is based on the use of objective data, and provides a rational rather
than an emotional basis for decision making. The statistical approach to process
management in both engineering and manufacturing recognizes that most problems are
system-related, and are not caused by particular employees. In practice, data is collected
and put in the hands of the people who are in the best position to analyze it and then take
the appropriate action to reduce costs and prevent non-conformance. Usually these people
are not managers but workers in the process. If the right information is not available, then
the analysis, whether it be of shop floor data, or engineering test results, can't take place,
errors can't be identified, and so errors can't be corrected.
6. EMPLOYEE PARTICIPATION:
A successful TQM environment requires a committed and well-trained work force

that participates fully in quality improvement activities. Such participation is reinforced
by reward and recognition systems which emphasize the achievement of quality
objectives. On-going education and training of all employees supports the drive for
quality. Employees are encouraged to take more responsibility, communicate more
effectively, act creatively, and innovate. As people behave the way they are measured and
remunerated, TQM links remuneration to customer satisfaction metrics.
7. A TQM CULTURE:
It's not easy to introduce TQM. An open, cooperative culture has to be created by
management. Employees have to be made to feel that they are responsible for customer
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satisfaction. They are not going to feel this if they are excluded from the development of
visions, strategies, and plans. It's important they participate in these activities. They are
unlikely to behave in a responsible way if they see management behaving irresponsibly -
saying one thing and doing the opposite.
8. PRODUCT DEVELOPMENT IN A TQM ENVIRONMENT:
Product development in a TQM environment is very different to product development in

a non-TQM environment. Without a TQM approach, product development is usually
carried on in a confliction atmosphere where each department acts independently. Short-
term results drive behavior so scrap, changes, work-around, waste, and rework are normal
practice. Management focuses on supervising individuals, and fire-fighting is necessary
and rewarded.
Product development in a TQM environment is customer-driven and focused on quality.

Teams are process-oriented, and interact with their internal customers to deliver the
required results. Management's focus is on controlling the overall process, and rewarding
teamwork.
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5.7 TOTAL PRODUCTIVITY OF AN

EMPLOYEE:
Productivity of an employee is divided into following parts:-

1. Scanning
2. Data entry
3. Registration
1. Scanning:
Scanning means the forms and data filled by the customers are checked and
validated that whether they are filled properly or not. The person scans that all the
details needed for the transaction are filled properly or not.
2. Data entry:
The forms received from the customers are first scanned and then all the data are
entered in the employee desk.
It contains:-
o PANCARD
o ID and ADDRESS PROOF
o Partner or broker enrollment
o KYC (know your client)
SELF DECLARATION:
Self declaration is nothing but a form to be filled by the partners. It means that
the partners of the N.J. India have to fill up one form called self declaration then only
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they get their brokerage. These self declaration forms are sent to the AMC (Asset
Management Company).
ARM:
(AMFI registration number)
AMFI registration number is the number which the partner gets after clearing the
AMFI test. This number is valid for the 5 years. After the completion on 5 years the
partner has to get renewed from the respective authority.
WEALTH A/C:
Pan card
Address proof
Blank cheque
1.5% or RS.
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Finance:
6.1 Financial Management:
Financial Management is the operation activity of a business that is responsible
for obtaining and effectively utilizing the funds necessary for efficient operations.
It deals with the situation that requires selection of specific assets or combination
of specific assets, selection of specific or combinations of liability as well as the
problems of size and growth of an enterprise.
The analysis of these decisions is based on the expected inflows and outflows of
funds and their effects upon managerial objectives.
- 109 -
6.2 Activities of Financial Department:
Some of the activities of Financial Department are:
1. Financial Planning:
This is an important function of management planning. A financial
manager has to make plan for capital investment and also the working capital for
the coming year. The cash budget being an important form of working capital
plan has to be prepared by top management in consultation with other managers.
The control can be exercised only by comparing the actual performance with the
standards set in the plan.
A firm had to plan its financial structure in order to smooth and a
systematic flow of the firm. Similarly NJ too plans its financial structure.
2. To determine the asset-managerial policy :

Taking decision about the asset in which funds, by invested in a delicate
job. It is crucial because profitability of business depends to a large extent on this
decision. The financial manager has to take decision as how much to invest in
fixed assets. The decisions about investment in fixed asset belong to capital
budgeting decision. The day to day flow of cash will also influence the amount of
investment in current assets. The financial manager has to take decision related to
asset management in consultation with top management along with other
department heads.
NJ takes the decision of investing its funds in others places.
3. To determine requirement of finance and external source

of finance :
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The finance manager has to estimate the requirement of finance on basis

of budgets. For coming year on the basis of the estimate of inflow and outflow of
cash in future he has to estimate the additional cash that would be required from
time to time and he has to make provision to get it at the right time. In other
words he will have to decide how much finance should be raised from
commercial banks and other financial institutions and through the issue of shares,
debentures, etc.
The financial manager of NJ finds out if there is any need of external
funds and the source it can borrow the required funds.
4. Negotiation of obtaining funds :

After deciding how much finance is to be raised from external sources the
finance manager has to initiate necessary negotiations and to go through
necessary formalities and procedures. For short term requirements banks may be
approached whereas long term requirement financial institutions can be
approached and also issue of debentures and shares can be considered.
Incase of any requirement of funds, the financial department of NJ
negotiates with different financial institutes and obtains the firm.
5. Distribution of net profits :

The distribution of net profit after tax earned during the year is one of the
most important functions of financial manager. There are two uses to which net
profit can be put:
(a) To distribute among the shareholders.
(b) To retain it in the business for expansion and development in finance. It is

customary to distribute profits among other participants in business such
as employees. But in this case the distribution policy is determined
- 111 -
through an agreement with trade union in consultation with top

management.
These decisions have an impact on the market price of the share. Thus this
decision has to be taken carefully.
Distribution of net profit is a major reason of conflict between the partners.
NJ’s financial department makes sure that fair distribution is profits is made.
6. Estimating and controlling cash flow :

It is the responsibility of financial manager to ensure management there is
enough cash on hand at the time when debts are to be paid. Thus detailed estimate
of inflow and outflow of cash for coming year is done. This further depends on
volume of sales. Hence forecast of the sales must be made basis for estimating
cash flow. Also the credit policy of the firm must also be given consideration so
that a clear idea can be obtained about the cash flow.
NJ estimates the inflow and out flow of the coming year, so that a clear
picture of the firm can be seen.
7. Controlling financial performance :

It is necessary to ensure that actual performance is in accordance with
financial policy and plans. For this purpose he can use such tools and methods as ratio
analysis, break even analysis, budgetary controls, etc … In case of discrepancies,
remedial measures will have to be taken to improve technique, standards of
procedures.
As in every firm different tools are used to control its performances. NJ too
uses tools like ratio analysis, Budget etc.
8. Advice top management :
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The financial manager advises the top management in respect of financial

matter and suggests various alternative solutions for financial difficulties. He
makes effort to increase the profitability of capital invested in the firm.
If the top management at NJ has to taken some financial decision, its
financial manger helps and suggests it with the pros and corns of the decision to
be taken.
9. Tally cash and bank balance:

The inflows and outflows of cash can effectively be controlled if there
complete records are maintained. Hence financial department takes care to see a rule
that proper records of cash are maintained.
It is very necessary to keep track of the cash and bank money being used. For
this one has to see to it that its cash and bank balance tally’s with the funds being
used. One of the work of finance department of NJ is to tally its cash and bank
balance.
10. Insurance policy:

Finance department has also to look after such matters as taking out insurance
of various assets, to preserve insurance policies and to preset claim and obtain money.
NJ’s financial department sees that the insurance policies are taken properly,
premium is paid regularly.
11. Safeguarding Valuable papers:

It surplus cash is invested in securities such as shares, debentures, bound etc.
then these securities must be properly safeguarded. It must see that interests are
received on time.
The financial department at NJ safeguards all the important documents like
property papers, clients details etc.
12. To prepare reports:
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Financial department has to prepare and submit reports on financial matters so

that management is fully informed of financial and conditions of the business, annual
reports, and budgets are prepared.
Nj prepares all the reports so that the management is fully informed about the
present condition and the future plans.
Thus NJ does the above activities in order for systematic and a smooth flow of
funds.
- 114 -
6.3 CASH BUDGET:

Cash budget occupies a unique position in financial management of modern
business entriprise.
An estimation of the cash inflow and outflow for a business, for a specific period of
time is known as cash budget. Cash budgets are often used to assess whether the entity
has sufficient cash to fulfill regular operations and/or whether too much cash is being left
in unproductive capacities.
A cash budget is extremely important, especially for small businesses, because it
allows a company to determine how much credit it can extend to customers before
it begins to have liquidity problems.
For individuals, creating a cash budget is a good method for determining where
their cash is regularly being spent. This awareness can be beneficial because knowing the
value of certain expenditures can yield opportunities for additional savings by cutting
unnecessary costs.
ASSUMPTIONS:
Opening balance is 169847
Everything is paid and received in the same month.
- 115 -
Cash Budget
Particular June July August
Opening balance 169847 86706771 173243695
Receipts:
FD BROKERAGE INCOME 209461 209461 209461
INVESTMENT INCOME 133710 133710 133710
MF BROKERAGE INCOME 67017426 67017426 67017426
OTHER BROKERAGE INCOME 416667 416667 416667
OTHER INCOME 117935 117935 117935
Sales 50125378 50125378 50125378
SUBCRIPTION INCOME 959628 959628 959628
Total 11915005 205686976 292223900
2
Payments:
Purchase
ADMINISTRATIVE & GENERAL EXPENSE 2731822 2731822 2731822
COMMUNICATION EXPENSE 431759 431759 431759
CONSULTING CHARGES 4892 4892 4892
EMPLOYEE EXPENSES 9240 9240 9240
FD BROKERAGE EXPENSE 129270 129270 129270
MARKETING & BUSINESS PROMOTION 500105 500105 500105
EXPENSES
MF BROKERAGE EXPENSE 18364166 18364166 18364166
OTHER BROKERAGE EXPENSE 30967 30967 30967
OTHER EXPENSES 5712 5712 5712
POSTAGE & COURIER EXPENSE 1194652 1194652 1194652
RENT, RATES & TAXES 2261528 2261528 2261528
SALARY EXPENSE 5495746 5495746 5495746
SOFTWARE EXPENSE 655300 655300 655300
STATIONERY & PRINTING EXPENSE 318209 318209 318209
TRAVELLING EXPENSES 309913 309913 309913
Total Payments 32443281 32443281 32443281
Closing Balance 86706771 173243695 259780619
- 116 -
6.4 FUND FLOW STATEMENT:

Fund Flow Statements summarize a firm’s inflow and outflow of funds. Simply put, it
tells investors where funds have come from and where funds have gone. The statements
are often used to determine whether companies efficiently source and utilize funds
available to them.
How to Prepare a Fund Flow Statement?
Fund flow statements are prepared by taking the balance sheets for two dates
representing the coverage period. The increases and decreases must then be calculated for
each item. Finally, the changes are classified under four categories: (1) Long-term
sources, (2) long-term uses, (3) short-term sources, (4) short-term uses.
It is also important to zero out the non-fund based adjustments in order to capture only
the changes that are accompanies by flow of funds. However, income accrued but
received and expenses incurred but not received reckoned in the profit and loss statement
should not be excluded from the profit figure for the fund flow statement.
Fund flow statements can be used to identify a variety of problems in the way a company
operates. For example, companies that are using short-term money to finance long-term
investments may run into liquidity problems in the future. Meanwhile, a company that is
using long-term money to finance short-term investments may not be efficiently utilizing
its capital.
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Schedule of Change in Working Capital

Between 2009 and 2010
Particular 2009 2010 Increase Decrease

Current Assets
Bank 1,036,462 1526629 490167 -
CASH ON HAND 412804 511530 98726 -
CLOSING STOCK 53,015,630 30636519 - 22379111
MUTUAL FUND 13,559,605 6240628 - 7318977
BROKERAGE
RECEIVABLE
FD BROKERAGE 906176 1129614 223438 -
RECEIVABLE
A/C
P.I.BROKERAGE 20644 25614 4970 -
RECEIVABLE
PMS INCOME 90613 112619 22006 -
RECEIVABLE
OTHER 27235 30640 3405 -
BROKERAGE
RECEIVABLE
SUNDRY 11175059 1460609 - 9714450
DEBTORS
Total Current 80244228 41674402 842712 39412538
Assets (A)
- 118 -
Particular 2009 2010 Increase Decrease

Current liability
MUTUAL FUND 34,225,864.00 4,451,647.00 29774216
PAYABLE
FD 533,961.00 651,410.00 - 117450
SUBBROKERAGE
PAYABLE A/C.
SUNDRY 666,297.00 889,364.00 - 223067
CREDITORS
SUNDRY 492,135.00 534,508.00 - 42373
CREDITORS
(ASSETS)
SUNDRY 937,866.00 1,130,504.00 - 192638
CREDITORS
(REIMBURSEMENT)
SUNDRY 1,016,042.00 1,260,129.00 - 244087
CREDITORS (RENT)
Total Current 30616928 40232153
37,872,165.00 8917564.57
Liability (B)
Working Capital 42,372,063.00 32,756,837.43
Decrease in working 9615225.57 9615225 -

Capital
Total 42372063 42372063 4023215 40232153
3
Schedule of sources and application of funds
Sources Amount Application Amount
- 119 -
Purchase of 4011300
Investment
Adjusted profit 4182933
Purchase of Fixed 9786858
Assets
Decrease in 9615225
Working Capital
Total 13798158 Total 13798158
- 120 -
6.5 WORKING CAPITAL REQUIREMENT:
The working capital requirement is the minimum amount of resources that a

company requires to effectively cover the usual costs and expenses necessary to operate
the business. Since the capital needs of each company will be a little different, there is no
ideal working capital requirement that is universally applicable to all businesses, or even
to companies engaged in the same industry. However, new companies can develop an
idea of what type of working capital requirement they will need to operate at given
levels by researching the cost and expenses associated with other corporations engaged in
similar operations.
The basic formula for determining working capital involves only two factors.
First, it is necessary to define the current liquid assets in the possession of the company.
This may be somewhat different from general assets, since the focus is on those resources
that can be converted into cash quickly and easily. Liquid assets may be such resources as
the outstanding current Accounts Receivable balance, property that is not directly used in
the operation of the business, and balances in various operating accounts.
Working Capital Requirement = Current Assets – Current

Liability
Along with defining the liquid assets of the company, determining the working
capital requirement will also allow for the current liabilities of the corporation. This will
include both short-term liabilities, such as the usual and general monthly operating
expenses, as well as any long-term debt. By deducting the liabilities from the liquid
assets, it is possible to determine the current working capital requirement.
The general idea is to ensure there is enough revenue generated to cover the
essential operations of the corporation and allow for additional revenue to be generated in
the future. Companies may currently operate with a negative working capital
requirement, based on some long-term debt, but this is not necessarily a sign that the
- 121 -
company is in financial trouble. However, calculating the current working capital

requirement at least once a quarter will allow the company to spot trends that may
indicate problems. For example, if the working capital requirement reveals a higher
negative ratio from previous periods even though long-term debt was reduced, this may
indicate an issue with decreased sales and earnings or other factors that are causing a
lessening of needed capital.
Particular 2010 2009 2008

Current Assets
Bank 1526629 1,036,462 785,316
CASH ON HAND 511530 412804 398,021
CLOSING STOCK 30636519 53,015,630 61,498,130.80
MUTUAL FUND 6240628 13,559,605 15,407,540
BROKERAGE
RECEIVABLE
FD BROKERAGE 1129614 906176 807,786
RECEIVABLE A/C
P.I.BROKERAGE 25614 20644 18,160
RECEIVABLE
PMS INCOME 112619 90613 82,099
RECEIVABLE
OTHER 30640 27235 23,191
BROKERAGE
RECEIVABLE
SUNDRY 1460609 11175059 1,059,233
DEBTORS
Total Current 41674402 80244228 80079477
Assets
- 122 -
Particular 2010 2009 2008

Less: Current
liability
MUTUAL FUND 4,451,647.77 34,225,864.00 25,727,374.00
PAYABLE
FD 651,410.73 533,961.00 498,459.00
SUBBROKERAGE
PAYABLE A/C.
SUNDRY 889,364.82 666,297.00 58,914,268.00
CREDITORS
SUNDRY 534,508.26 492,135.00 356,487.00
CREDITORS
(ASSETS)
SUNDRY 1,130,504.00 937,866.00 861,670.00
CREDITORS
(REIMBURSEMENT)
SUNDRY 1,260,129.00 1,016,042.00 977,734.00
CREDITORS (RENT)
Total Current
8917564.57 37,872,165.00 87,335,992.00
Liability
Working Capital
32,756,837.43 42,372,063.00 (7,256,515.20)
Requirement
- 123 -
6.6 ANNUAL REPORTS:
A formal presentation of the corporation’s financial statements that is sent to its

registered stockholders is known as annual reports. If shares are registered in the nominee
name (in the care of the brokerage firm), the proxy department has to obtain copies of the
report and mail them to the beneficial owners (clients). Annual reports are intended to
give shareholders and other interested people information about the company's activities
and financial performance. Most jurisdictions require companies to prepare and disclose
annual reports, and many require the annual report to be filed at the company's registry.
Companies listed on a stock exchange are also required to report at more frequent
intervals
An annual report is primarily undertaken for the protection of shareholders and

includes financial highlights, chairman's statement and director reports
There are several aims associated with a company's annual report which include
the following: to provide protection to shareholders, information to mangers, customers
and suppliers as well as help for prospective shareholders thinking of investing in the
company. The company report is used to satisfy legal reporting requirements and is also
used by the chairman and directors as a means of advertising.
Annual reports typically consist of the following areas:
• Mission statement
• Financial highlights
• Chairman's statement
• Chief executive and directors' reports
• Operations review
• Auditors report
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Company Annual Reports - Mission Statement
A mission statement (for anyone who has not seen 'Jerry Maguire!') is basically a
strategy statement which explains the intent or vision of the company and is usually
shown on either the front cover or clearly laid out on the first page of the report. Ideally,
mission statements should be short and simple to comprehend. This statement must then
be identified as being relevant to the content of the report in order for it to be valid.
Company Annual Reports - Financial Highlights
Following the mission statement, the next part of the annual report is used to
show a financial comparison between the company's performance during previous year
and the year before. It is important to always bear in mind when reading the financial
highlights that as interesting as it may be it is highly likely that any figures will have been
very carefully chosen in order to make the company look as profitable as investment as
possible.
Company Annual Reports - Chairman's Statement
The chairman's statement is essentially associated with laying out the company's
main intentions and will usually include information on critical aspects relating to issues
from the past and those in the future. Key sections identified in this statement will include
areas such as dividends, structural information, personnel information as well as focusing
on main trading aspect from the previous year.
In terms of dividends, the chairman described a strategy on dividend in the future

which will have been put together by the board.
- 125 -
Company Annual Reports - Chief Executive/Directors' Reports
This area is legally required to provide certain information such as issues relating
to profit, dividend figures, research and development. Key aspects associated with this
section of the report include details on remuneration, shares, interest, donations
(charitable/political), auditors and creditor payment policies. Most director reports will
also offer additional information, for example regarding employment of disabled
personnel, environmental and corporate issues.
Company Annual Reports - Operations Review
The operations review is the key to understanding the company's strategy and will
involve employee at all different levels from those on the shop floor right up to directors.
This is a means of attempting to ensure that what is happening in all areas of the
company is tying in with intentions of the directors. Obviously, this is no easy task as it
effectively requires open communication throughout the entire company.
Company Annual Reports - Auditors' Report
Finally, the annual report will also contain the auditors' report which basically is
used to identify that the auditors have undertaken necessary work and how this was
completed. A key aspect of this report is what the auditors' opinion are regarding the
prepared accounts and whether there are any doubts expressed in relation to specific
accounting methods.
As highlighted above, the annual report is useful for shareholders, customers,
managers and suppliers as well as being a legal requirement. Key aspects of the annual
report include financial highlights, operations review and both the chairman and
directors' reports.
- 126 -
6.7 ACCOUNTING RATIOS:
Definition of Accounting Ratios:
The term "accounting ratios" is used to describe significant relationship between

figures shown on a balance sheet, in a profit and loss account, in a budgetary control
system or in any other part of accounting organization. Accounting ratios thus shows the
relationship between accounting data.
Ratios can be found out by dividing one number by another number. Ratios show
how one number is related to another. It may be expressed in the form of co-efficient,
percentage, proportion, or rate. For example the current assets and current liabilities of a
business on a particular date are $200,000 and $100,000 respectively. The ratio of current
assets and current liabilities could be expressed as 2 (i.e. 200,000 / 100,000) or 200
percent or it can be expressed as 2:1 i.e., the current assets are two times the current
liabilities. Ratio sometimes is expressed in the form of rate. For instance, the ratio
between two numerical facts, usually over a period of time, e.g. stock turnover is three
times a year.
Advantages of Ratios Analysis:
Ratio analysis is an important and age-old technique of financial analysis. The

following are some of the advantages / Benefits of ratio analysis:
1. Simplifies financial statements: It simplifies the comprehension of financial

statements. Ratios tell the whole story of changes in the financial condition of the
business.
2. Facilitates inter-firm comparison: It provides data for inter-firm comparison.
Ratios highlight the factors associated with successful and unsuccessful firm.
They also reveal strong firms and weak firms, overvalued and undervalued firms.
- 127 -
3. Helps in planning: It helps in planning and forecasting. Ratios can assist

management, in its basic functions of forecasting. Planning, co-ordination, control
and communications.
4. Makes inter-firm comparison possible: Ratios analysis also makes possible
comparison of the performance of different divisions of the firm. The ratios are
helpful in deciding about their efficiency or otherwise in the past and likely
performance in the future.
5. Help in investment decisions: It helps in investment decisions in the case of
investors and lending decisions in the case of bankers etc.
Limitations of Ratios Analysis:
The ratios analysis is one of the most powerful tools of financial management.
Though ratios are simple to calculate and easy to understand, they suffer from serious
limitations.
1. Limitations of financial statements: Ratios are based only on the information

which has been recorded in the financial statements. Financial statements
themselves are subject to several limitations. Thus ratios derived, there from, are
also subject to those limitations. For example, non-financial changes though
important for the business are not relevant by the financial statements. Financial
statements are affected to a very great extent by accounting conventions and
concepts. Personal judgment plays a great part in determining the figures for
financial statements.
2. Comparative study required: Ratios are useful in judging the efficiency of the
business only when they are compared with past results of the business. However,
such a comparison only provide glimpse of the past performance and forecasts for
future may not prove correct since several other factors like market conditions,
management policies, etc. may affect the future operations.
- 128 -
3. Ratios alone are not adequate: Ratios are only indicators; they cannot be taken as
final regarding good or bad financial position of the business. Other things have
also to be seen.
4. Problems of price level changes: A change in price level can affect the validity of
ratios calculated for different time periods. In such a case the ratio analysis may
not clearly indicate the trend in solvency and profitability of the company. The
financial statements, therefore, be adjusted keeping in view the price level
changes if a meaningful comparison is to be made through accounting ratios.
5. Lack of adequate standard: No fixed standard can be laid down for ideal ratios.
There are no well accepted standards or rule of thumb for all ratios which can be
accepted as norm. It renders interpretation of the ratios difficult.
6. Limited use of single ratios: A single ratio, usually, does not convey much of a
sense. To make a better interpretation, a number of ratios have to be calculated
which is likely to confuse the analyst than help him in making any good decision.
7. Personal bias: Ratios are only means of financial analysis and not an end in itself.
Ratios have to interpret and different people may interpret the same ratio in
different way.
8. Incomparable: Not only industries differ in their nature, but also the firms of the
similar business widely differ in their size and accounting procedures etc. It
makes comparison of ratios difficult and misleading.
- 129 -
Classification of Accounting Ratios:
Ratios may be classified in a number of ways to suit any particular purpose.

Different kinds of ratios are selected for different types of situations. Mostly, the purpose
for which the ratios are used and the kind of data available determine the nature of
analysis. The various accounting ratios can be classified as follows:
Classification of Accounting Ratios / Financial Ratios

(A) (B) (C) (D) (E)
Profitability Profitability Liquidity Capital Turnover
Ratio Ratio based on Ratio Gearing Ratio Ratio
Investment
• Gross • Return on • Current • Proprietary • Stock
Profit Capital Ratio Ratio turnover
Ratio Employed • Liquid • Debt • Debtors
• Operating • Return on Ratio Equity Ratio
Ratio share • Creditors
• Acid Ratio
• Expenses holders Velocity
Ratio • Gearing
Ratio fund • Total
Ratio Asset
• Return on • Long Term Turnover
• Net Profit Equity Funds to
Ratio share Fixed
capital Assets
• Earnings • Interest
per Share Coverage
Ratio
- 130 -
PROFITABILITY RATIOS:
1. Gross Profit Ratio:

Gross profit ratio (GP ratio) is the ratio of gross profit to net sales expressed as a
percentage. It expresses the relationship between gross profit and sales.
Gross Profit = Gross Profit *100

Sales
76622394
2009-2010 = *100
601504530
= 12.74%
70860460
2008-2009= *100
484,812,651
= 14.62%
2007-2008= 49031534
*100
364511745
=13.45%
- 131 -
2. OPERATING RATIOS:
A ratio that shows the efficiency of a company's management by comparing
operating expense to net sales is known as operating ratio.
Cost of Good Sold + Operating Expense

Operating Ratio= * 100
Net Sales
2009-2010
Operating Expense= Administrative Expense + Interest + Selling Expenses
=3278166
Cost of Goods Sold= Opening stock+ Purchase – closing stock
=53015630+502503025-30636519
= 524,882,136
524,882,136 +3278166
601504530
= 88%
- 132 -
Operating Expense
= 25,995,212
Cost of Goods Sold
= 413,952,192
25,995,212+413,952,192
2008-2009= *100
484,812,651
=91%
Operating Expense
= 23684835
Cost of Goods Sold
= 315,480,211
23684835+315,480,211
2008-2007= *100
364511745
=93%
This ratio shows the operational efficiency of the firm. For a manufacturing and
service concern an operating ratio between 75% and 80% is expected. In past three years
operating ratio of NJ is above 85% so we can say that the firm’s profitability is nice and it
is an efficient firm.
- 133 -
3. NET PROFIT RATIO:
The net profit ratio is net profit expressed as a percentage of total sales. Net profit
is taken before tax and other indirect costs.
Essentially the net profit ratio tells us about how the company's profits relate to
their sales. Different industries have fundamentally different net profit ratios. The net
profit ratio can tell us about the nature of the industry the company is operating in as well
as serving to compare past performances of a company.
Net Profit Ratio = Net Profit *100

Net Sales
509704771
2009-2010= * 100
601504530
= 80.60%
469397901
2009-2010= * 100
484,812,651
= 96.82%
409000444
2009-2010= * 100
364511745
= 112.21%
- 134 -
4. PROFITABILITY RATIO BASED ON INVESTMENT:
Return on Capital Employed:
The prime objective of making investments in any business is to obtain

satisfactory return on capital invested. Hence, the return on capital employed is used as a
measure of success of a business in realizing this objective.
Return on Capital Employed= Operating Profit * 100
Capital employed
2009-2010
Operating Profit: Gross Profit - Administrative expenses
=76622394 – 32781866
=43840528
Capital employed: Owner’s Equity = 502000
Return on Capital Employed= 43840528*100
502000
= 8733.17%
2008-2009
= 70,860,460 – 25,995,212
=44865248
- 135 -

502000
=8937.30%
2007-2008
= 49,031,534 - 23,684,835
=25346699

502000
= 5,049.14%
- 136 -
5. LIQUIDITY RATIO:
(1) CURRENT RATIO
It measures the solvency of the company in the short term. It also indicates the
firm’s ability to pay its current liabilities .It shows the strength of credit, working capital
and capacity to carry on effective operation.
Current Ratio = Current Assets

Current Liabilities
41674402
2009-2010=
8917564.57
= 4.67:1
80244228
2008-2009=
37872165
= 2.12
80079477
2008-2009=
87335992
= 0.91:1
- 137 -
Liquid Ratio:
A class of financial metrics that is used to determine a company's ability to pay
off its short-terms debts obligations is known as liquid ratio. Generally, the higher the
value of the ratio, the larger is the margin of safety that the company possesses to cover
short-term debts.
Liquid Ratio= Liquid Assets

Liquid Liability
Liquid Assets= Current Assets-(Stocks and Prepaid Expenses)
Liquid Liabilities= Current Liability- Bank Overdraft
2009-2010
Liquid Assets
= 41,674,402- (30,636,519)
=11,037,883
Liquid Liability
= 8,917,564.57
= 11,037,883 .
8917564.57
=1.23:1
2008-2009
Liquid Assets
= 80,244,228-(53,015,630)
= 27,228,598
Liquid Liability
= 37,872,165
= 27,228,598
37,872,165
=0.71:1
- 138 -
2007-2008
Liquid Assets
=80,079,476.80-(18,581,346)
=61,498,130.80
Liquid Liability
= 87,335,992
= 61,498,130.80
87,335,992
=0.21:1
- 139 -
Capital Gearing Ratio
 PROPRIETARY RATIO
This ratio shows the proportion of proprietors fund to the total assets
employed in the business. The higher the ratio the stronger the financial position of
the enterprise as it signifies that the proprietors have provided the larger fund to
purchase the assets. Proprietor’s funds include share capital, reserves and surplus.
Total Assets include the total of the asset side of the balance sheet.
Proprietary Ratio = Proprietor’s Funds *100

Total Assets
2009-2010
T o t a l A s s e t s = 170,583,483
Proprietor’s fund: Share capital - 502000
Reserves and Surplus – 161163918
= 161665918 * 100
170,583,483
= 94.77%
- 140 -
2008-2009
T o t a l A s s e t s = 195,999,476
Proprietor’s fund: Share capital – 502000
Reserves and Surplus -157,625,311
= 158,127,311 * 100
195,999,476
= 80.68%
2007-2008
T o t a l A s s e t s = 177,010,760.80
Proprietor’s fund: Share capital – 502000
Reserves and Surplus - 89,172,769
= 89,674,769 * 100
177,010,760.80
= 50.66%
- 141 -
Turnover Ratio
Stock Turnover:
Stock turn over ratio and inventory turn over ratio are the same. This ratio is a
relationship between the cost of goods sold during a particular period of time and the cost
of average inventory during a particular period. It is expressed in number of times. Stock
turn over ratio / Inventory turn over ratio indicates the number of time the stock has been
turned over during the period and evaluates the efficiency with which a firm is able to
manage its inventory.
Stock Turnover Ratio=COGS
Average Inventory
Cost OF Goods Sold (COGS)
= Sales-Gross Profit
Average Inventory
= Opening stock + Closing stock
- 142 -
2009-2010
COGS=601504530-76622394
=524882136
Average Inventory
= 53015630+30636519
=41826074.5
= 524882136
41826074.5
=12.55 times
2009-2008
COGS= 413,952,192
Average Inventory
= 61,498,131 + 53,015,630
2
=57256880.4
= 413,952,192
- 143 -
57256880.4
=7.23times
- 144 -
2009-2008
COGS=315,480,211
Average Inventory
= 23,015,211 + 61,498,130.80
2
= 84,513,341.80
= 315,480,211
84,513,341.80
=3.73 times
- 145 -
TOTAL ASSETS TURNOVER RATIO
It shows the relationship between total assets to sales. The sales are
affected through investment in fixed assets to earn profits. The higher the ratio
shows that with less amount of investment in total assets the business has a
capacity to sell more as its profitability is also more.
Total Asset Turnover = Net Sales

Total Assets
2009-2010
= 601,504,530
170,583,483
=3.52 Times
2008-2009
= 484,812,651
195,999,476
=2.47 Times
2007-2008
= 364511745
177,010,760.80
= 2.06 Times
- 146 -
 Fixed assets Turnover:
To ascertain the efficiency and profitability of business, the total fixed assets
are compared to sales. The more the sales in relation to the amount invested in
fixed assets, the more efficient the use of fixed assets.
Fixed assets Turnover= Sales

Fixed assets
2009-2010
= 601,504,530
88,090,526
= 6.83 Times
2008-2009
= 484,812,651
78,303,668
=6.19 Times
2007-2008
= 364,511,745
61,760,268
= 5.90 Times
- 147 -
6.8 COMMON SIZE STATEMENT:

Financial statements when read with absolute figures are not easily
understandable. They are even misleading. Each item of assets is converted into
percentage of total assets and each item of capital and liabilities is expressed to total
liability and capital fund. Thus the whole balance sheet is converted into percentage
form. Such converted balance sheet is known as common size balance sheet. When
balance of same concern for several years or when balance sheet of two or more than two
concerns for the same year is converted into percentage form and presented as such they
are known as comparative common size balance sheets. Again in profit and loss account
sales figure is assumed to be equal to 100 and all other figures are expressed as a
percentage of sales. Similarly in balance sheet the total of assets or liabilities is taken as
100 and all figures are expressed as percentage of the total.
Common Size Profit and Loss Statement
Particular 2010% 2009% 2008%

Sales 100 100 100
Less Cost of goods 87.26 85.38 86.55
sold
Gross profit 12.74 14.62 13.45
Less administrative 2.13 5.36 6.50
expense
Less selling expense - - -
Net operating profit 10.61 9.25 6.95
Add other income 137.37 152.13 180.08
Less other expenses 25.74 64.57 74.82
Net profit 122 96.82 112.21
- 148 -
Common Size Balance Sheet

Particular 2010% 2009% 2008%
Assets
FIXED ASSETS 51.64 39.95 34.89
INVESTMENTS 23.52 18.42 19.26
CURRENT ASSETS 0.00 -
BANK A/C. 0.89 0.53 0.44
CASH ON HAND 0.30 0.21 0.22
CLOSING STOCK 17.96 27.05 34.74
MUTUAL FUND BROKERAGE 3.66 6.92 8.70
RECEIVABLE
FD BROKERAGE 0.66 0.46 0.46
RECEIVABLE A/C.
P.I.BROKERAGE 0.02 0.01 0.01
RECEIVABLE
PMS INCOME RECEIVABLE 0.07 0.05 0.05
OTHER BROKERAGE 0.02 0.01 0.01

RECEIVABLE
SUNDRY DEBTORS 0.86 5.70 0.60
ADVANCE FOR BRANCH 0.41 0.69 0.61
EXPENSES
TOTAL ASSET 100 100 100
LIABILITY
SHARE CAPITAL (PAID UP) 0.29 0.26 0.28
NET PROFIT RESERVE 94.48 80.24 50.38
Current liability
- 149 -
MUTUAL FUND PAYABLE 2.61 17.42 14.53

FD SUBBROKERAGE 0.38 0.27 0.28
PAYABLE A/C.
SUNDRY CREDITORS 0.52 0.34 33.28
(ASSETS)
(REIMBURSEMENT)
SUNDRY CREDITORS (RENT) 0.74 0.64 0.55
Total Liability 100 100 100
- 150 -

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Creating wealth, Transforming life.

Devika Jariwala Rubab Lokhandwala Nirali Shah

In market various instrument (alternatives) are available to save one’s money.

1. Introduction to Mutual Fund

2. History of the Firm- 22

4. Human Resource Department

1. ABOUT MUTUAL FUNDS:

First Phase – 1964-87

Second Phase – 1987-1993 (Entry of Public Sector Funds)

Third Phase – 1993-2003 (Entry of Private Sector Funds)

Fourth Phase – since February 2003

Mutual Funds in India is gaining ground and getting popular as an investment

Structure of Mutual Funds:

SEBI approved Asset Management Company (AMC) manages the funds by

According to SEBI Regulations, two thirds of the directors of Trustee

AMFI also is engaged in upgrading professional standards and in promoting best

1.2 HOW SAFE IS INVESTING IN MUTUAL

Investing in Mutual Fund:

Mutual funds are considered as favorable investment vehicle for individual

Professional Management and Expertise:

1.3 TYPES OF MUTUAL FUNDS

Based on company size, large, mid, and small cap

Stock market sector

Mutual funds of mutual funds

Exchange traded funds (ETFs)

1.4 FUTURE OF MUTUAL FUND INDUSTRY:

1.5 Advantages and Disadvantages of Mutual Fund

Advantages of Mutual Fund

Disadvantages of Mutual Fund

Entry and Exit load

No control over costs

At NJ they exist to provide quality financial / investment advisory solutions to

NJ prides in being a professionally managed, quality focused and customer centric

At NJ, they believe in.

2.1 THEIR DIVISIONS

NJ Fundz Network has been playing a pioneering role in India in providing

The scope of properties embraces both commercial & residential projects /

NJ Gurukul works to conceive craft, design, develop and execute effective

NJ Gurukul also seeks to help people become better professionals / business

For businesses, as a people partner, NJ Gurukul seeks to groom employees &

• Range of products and services offered

The key members of the management are:

Mr. Neeraj Choksi Jt. Managing Director

Key Sales Team:

Mr. Misbah Baxamusa National Head

Key Executive Team:

Mr. Shirish Patel Information Technology

NJ offers advisory and distribution services on the following products.

1. Mutual funds – covering all AMCs &

2. Fixed deposits of companies

3. Government/ RBI Bounds

5. Approved securities for charitable trusts,

Year 2006: Award – Vietnam

3.1 MUTUAL FUND – MARKETING

The market segments are quite distinct because of investment objectives.

MARKETING STRATEGIES ADOPTED BY THE MUTUAL

(a) Direct Marketing

Hoardings and Banners

(B) Selling Through Intermediaries

(C) Other Channels

3.2 ACTIVITIES OF MARKETING

Some of the activities NJ India Invest practices in marketing department are as

3.3 MARKETING ENVIRONMENT: