Anda di halaman 1dari 79

CHAPTER-1

INTRODUCTION

INTRODUCTION: The project basically carried out to give good guidelines for investor. And also to educate the investors about mutual funds. The project idea is to project mutual funds as the better avenue for investment. Mutual fund is productive package for a lay-investor with limited finances. Mutual fund is a very old practice in U.S., and it has made a recent entry into India. Common man in India still finds Bank as a safe door for investment. This shows that mutual funds have not gained a strong foot-hold in his life. The project creates an awareness that the mutual fund is worthy investment practice. The various schemes of mutual funds provide the investor with a wide range of investment options according to his risk-bearing capacities and interest. Besides, they also give a handy return to the investor. The project analyses various schemes of mutual fund by taking different mutual fund schemes from different AMCS. The future challenges for mutual funds in India are also considered. INVESTMENT CHOICE: Investment experts recommend equities for the long term (in the short run the price movements can lead to serious losses), debt for the medium term and bank deposits for the short term. APPROPRIATE MIX FOR THE VARIOUS INVESTMENTS/ ASSET ALLOCATION PLAN: All investments can be broadly categorized into Equity, Debt and Cash/ Bank Deposits. These categories, in financial parlance are termed as Asset classes. Making an Asset Allocation plan. Therefore categories and just the individual investments those are within each category. Reasons for which investments are made: For security and liquidity For income For growth and capital appreciation Proportions of these investments will depend upon individual goals, time horizons available to meet those goals, ones risk-profile (i.e., reactions to down turn in the stock/ bond market) An example of Asset Allocation Plan: 1. An Aggressive growth portfolio 2. A moderate portfolio 3. A conservative portfolio

An Aggressive growth portfolio suggests 70% of portfolio in stocks or equity funds, 20% in bonds or debt funds and 10% in short-term money market instruments or liquid funds. This portfolio is meant for capital appreciation. 1. A moderate portfolio seeks to balance growth and stability. It recommends around 50% of the portfolio in stocks or equity funds, 30% in bonds or debt funds and 20% in short-term instruments or liquid funds. This portfolio would seek to provide regular income with moderate protection against inflation. 2. A conservative portfolio suggest s 20% in stocks or equity funds, 40% in bonds or debt funds and 40% in bank deposits or liquid funds and is ideal for investment strategy aiming to keep savings secure.

Many of us do not have the time, the inclination or the to make and manage investments in the complex equity or debt market directly. And thats where Mutual Fund Manager can be of great proffessional help. OBJECTIVES: 1. To project mutual funds as the productive avenue to invest in contrast to the laxity of bank investing.
2.

To show the wide range of investment options available in MFs by explaining various schemes offered by different AMCs.

3. To help an investor to make a right choice of investment, while considering the inherent risk factors. 4. To understand the recent trends in the MF world. 5. To understand the risk and return of the various schemes. 6. To find out the various problems faced by Indian mutual funds and possible solutions.

PURSPOSE OF THE STUDY: The study basically made to educate the investors about Mutual Funds. Analyze the various schemes to highlight the risk and return of diversity of investment that mutual funds offer. Thus through the study one would understand how a common man could fruitfully convert a pittance into great penny by wisely investing into the right scheme according to his risk- taking abilities. DATA COLLECTION METHODS: SCOPE OF THE STUDY: The study is limited to the analysis made for three major types of schemes offered by four AMCs namely Birla Sun life Asset Management Co. Ltd. Can bank Investment Management Services, DSP Merrill Lynch Investment Managers Ltd. and Templeton Asset Management (India) Pvt. Ltd. Each scheme is calculated their risk and return using different performance measurement theories. The reasons for such performance are immediately analyzed in the commentary. Pie charts are used to reflect the portfolio risk and return. LIMITATIONS OF THE STUDY: 1. The study is conducted in short period, due to which the study may not be detailed in all aspects. 2. The study is limited only to the analysis of different schemes and its suitability to different investors according to their risk-taking ability. 3. The study is based on secondary data available from monthly fact sheets, web sites, offer documents, magazines and newspapers etc. as primary data was not accessible. 4. The study is limited by the detailed study of various schemes.

CHATPER-2

REVIEW OF LITERATURE

INTRODUCTION TO MUTUAL FUNDS


CONCEPT A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciation realized are shared by its unit holders in proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, -professionally managed basket of securities at a relatively low cost. The flow chart below describes broadly the working of a mutual fund:

Mutual Fund Operation Flow Chart

BENEFITS OF MUTUAL FUND INVESTMENT


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.
8

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. 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: You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme, the proportion invested in each class of assets and the fund manager's investment strategy and outlook. 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.

TYPES OF MUTUAL FUNDS


TYPES OF MUTUAL

FUNDS

Operational

Investment Objective

Asset class

Territory

Closed ended

Growth (Capital Appreciation) Income

Equity

Sector

Open ended

(Dividend /
Interest) Balanced Growth

Bond

Domestic

income
Money Market

Taxable

Tax Exempt

International

Hybrid

(Share + Bonds

Single Fund

Country

Tax Free

Index

Regional Fund (eg.S.E. Asia)

International

Money Market

/foreign
Fund of Funds

International Fund

Specialized

Globel Fund

By Structure: Openended funds: An open end fund is one that is available for subscription all through the year. These do not have a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value (NAV) related prices. The key feature of open-end schemes is liquidity. Closed-ended funds: A closed end funds has a stipulated maturity period which generally raging from 3 to 15 years. The funds are open for subscription only during a specified period. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the

10

scheme on the stock exchanges where they are listed. In order to provide an exist route to the investors, some close ended funds give an option of selling back the units to the Mutual fund through periodic repurchase at NAV related prices. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor. Interval Funds: Interval funds combine the features of open-ended schemes. They are open for sale or redemption during pre-determined intervals at NAV related prices. By Investment Objective: Growth Funds: The aim of growth funds is to provide capital appreciation over the medium to long-term. Such schemes normally invest a majority of their corpus in equities. It has been proven that returns from stocks, have outperformed most other kind of investments held over the long term. Growth schemes are ideal for investors having a long-term outlook seeking growth over a period of time. Income Funds: The aim of income funds is to provide regular and steady income to investors. Such Schemes generally invest in fixed income securities such as bonds, corporate debentures and Government securities. Income Funds are ideal for capital stability and regular income. Balanced Funds: The aim of balanced funds is to provide both growth and regular income. Such schemes periodically distribute a part of their earning and invest both in equities and fixed income securities in the proportion indicated in their offer documents. In a rising stock market, the NAV of these schemes may not normally keep pace, or fall equally when the market falls. These are ideal for investors looking for a combination of income and moderate growth. Money Market Funds: The aim of money funds is to provide easy liquidity, preservation of capital and moderate income. These schemes generally invest in safer short-term instruments such as treasury bills, certificates of deposit, commercial paper and inter-bank call money. Returns on these schemes may fluctuate depending upon the interest rate prevailing in the market. These are ideal for Corporate and individual investors as a means to park their surplus funds for short periods.

11

Load Funds: A Load Funds is one that charge a commission for entry of exit. That is, each time you buy or sell units in the fund, a commission will be payable. Typically entry exit loads range from 1% to 2%. It could be corpus is put to work. No-Load Funds: A No-Load Fund is one that does not charge a commission for entry or exit. That is, no commission is payable on purchase or sale of units in the fund. The advantage of a no load is that the entire corpus is put to work. Other Schemes: Tax Saving Schemes: These schemes offer tax rebates to the investor under specific provisions of the Indian Income Tax laws as the Government offers tax incentives for investment in specified avenues. Investments in Equity Linked Saving Schemes (ELSS) and Pension Schemes are allowed as deduction u/s 88 of the Income Tax Act. The Act also provide opportunities to investors to save capital gains u/s 54EA and 54EB by investing in Mutual Funds, provided the capital assets has been sold to April 1, 2000 and the amount is invested before September 30, 2000. Special Schemes Industry Specific Schemes: Industry Specific Schemes invest in the industries specified in the offer document. The investment or these funds is limited to specific like InfoTech, FMCG, and Pharmaceuticals etc. Index Schemes: Index Funds attempt to replicate the performance of a particular index such as the BSE Sensex or the NSE Sectoral Schemes: Sectoral Funds are those, which invest exclusively in a specified industry or a group of industries or various segments such as A Group shares or initial public offerings.

12

HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY


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 the. The history of mutual funds in India can be broadly divided into four distinct phases First Phase 1964-87(UTI MONOPOLY) An Act of Parliament established Unit Trust of India (UTI) on 1963. 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 Can bank 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. 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.

13

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 Ltd, 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 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. As at the end of June 30, 2003, there were 31 funds, which manage assets of Rs.104762 crores under 376 schemes.

The graph indicates the growth of assets over the years.

14

Note: While UTI was bifurcated into UTI Mutual Fund and the Specified Undertaking of the Unit Trust of India effective from February 2003. The Assets under management of the Specified Undertaking of the Unit Trust of India has therefore been excluded from the total assets of the industry as a whole from February

TREND IN MUTUAL FUNDS INDUSTRY


15

The Indian Mutual fund industry, despite all that has been said about it is still in a nascent stage and has extremely bright future ahead. The industry is still one-tenth size of the banking deposits in the country. The private sector mutual fund industry in its resent avatar is barely 7 years old. The total asset under management over the past 4 to 5 tears has almost remained stagnant around the Rs 100, 000 crore mark. This has put a question mark in front of the claims that mutual funds are growing part of the financial savings and planning industry in India. It holds scope for growth. In India this industry began with the setting up of the Unit Trust Of India (UTI) in 1964 by the government of India in order to mobiles small saving. During the past 37 years, UTI has grown to be a dominant player in the industry with assets with over Rs 76,547 crore as of March2000. However, trouble hit UTI has lost its dominant position in the industry and the asset under management has slipped drastically to Rs 46,396 crore. Private sector mutual funds, which were permitted along with foreign partners in 1993, now enjoy a dominant position in the country. Kothari Pioneer Mutual fund was the first fund to be established in the private sector with foreign fund. The private sector now controls around RS 45,818 crore assets under management, almost half the size of the industry. The mutual fund industry has become a fastest growing sector in the countrys capital and financial market with an average compounded growth rate of 20 percent over the past five years. This is despite increasing competition with more than 30 asset management companies for investors money. As on June 2002, the industry has Rs 100,703 crore asset under management spread across 36 funds with more than 390 schemes. Substantial development have made; spurred on by changes and amendments in regulation as the mutual fund regulation that established a comprehensive legal framework for the mutual fund industry to develop coherently. The securities and Exchange Board Of India (SEBI) came out with comprehensive regulation in 1993 which defined the structure of the mutual fund and asset management Companies for the first time. The industry is in the process of evolving into a bigger and better investment medium for all market segment, Say Kavita Hurry, CEO ING Investment Management, further, currently, ING Investments manages around Rs.364 crore as on June 2002. Drastic Transformation:
16

The industry is undergoing a transformation and is witnessing large number of mergers, acquisitions and takeovers in the schemes and asset management companies. Mutual fund products are competing with the banks deposits, Reserves Banks of India (RBI) bonds, pension funds and post offices schemes that provide not only guaranteed return but also tax-free returns. However, mutual funds are unable to provide assured return since they are investing in financial markets and returns from them are, by definition, uncertain. These transformation benefiting the investor friendly open-ended schemes, increasing the range of funds to choose from, enhanced transparency and improvement regulation. New challenges and growth areas: However, an important step towards maturating of the industry will be develop third party distribution channel and expand distribution outside of the major cities. The challenges for the private fund players manager will be to break the big city limit and begin to sell and educate the rest of the market and to diversify sales, says Moodys Investors services and ICRA report on the industry. Further the report notes, asset management companies must attract more retail investors. A strong retail back-bone will create better standards, greater competition and more liquidity, in addition to maintain and improving best practices and better company governances. The industry needs go deeper into the existing markets and wider into the new markets and provides newer financial products to grow. Adds Nikhil Kattau, chief executive officer, Sun F&C. Sun F&C currently manages around Rs.427 crore. Another fundamental turning point in the growth of the mutual fund market is the opening of the market to the foreign investments. Now there is an industry wide limit for investing in overseas securities $500 million offering Indian Mutual funds and Indian investor the possibility to invest in the non-Indian security mutual funds is a fundamental step towards modernization and evolution of the market, notes Moddys ICRA report. Stable and long-term fiscal incentives designed to capture long-term retail and private pension savings will be of utmost importance for the industry. Here, governments fiscal policy and have the capital market regulators for the industrys continued growth will play an essential role.

17

In a supportive environment, investors would be reassured of a stable industry, private fund managers will be motivated and encouraged to develop new products and foreign managers will be attracted to the dynamic market. In an economy growing at 6 percent per annum, any fall in any segment by more than 30 percent obviously indicates that something serious is happening and concerned people need to take remedial steps. In the relative absence of UTI from the scne, till it fate decided by its masters in North Block, the onus of building investor confidences falls on the shoulders of the private sector mutual funds. With maturing financial markets and increasing marketing there are reasons for more than moderate optimisms. Market Trends: A lone UTI with just one scheme in 1964 now competes with as many as 400 odd products and 34 players in the market. In spite of the stiff competition and losing market share, UTI still remains a formidable force to reckon with. Last six years have been the most turbulent as well as exiting ones for the industry. New players have come in, while others have decided to close shop by either selling off or merging with others. Product innovation is now pass with the game shifting to performance delivery in fund management as well as service. Those directly associated with the fund management industry like distributors, registrars and transfer agents, and even the regulators have become more mature and responsible. The industry is also having a profound impact on financial markets. While UTI has always been a dominant player on the bourses as well as the debt markets, the new generation of private funds which have gained substantial mass are now seen flexing their muscles. Fund managers, by their selection criteria for stocks have forced corporate governance on the industry. By rewarding honest and transparent management with higher valuations, a system of risk-reward has been created where the corporate sector is more transparent then before. Funds have shifted their focus to the recession free sectors like pharmaceuticals, FMCG and technology sector. Funds performances are improving. Funds collection, which averaged at less than Rs100bn per annum over five-year period spanning 1993-98 doubled to Rs210bn in 1998-99. In the current year mobilization till now have exceeded Rs300bn. Total collection for the current financial year ending March 2000 is expected to reach Rs450bn. What is particularly noteworthy is that bulk of the mobilization has been by the private sector mutual funds rather than public sector mutual funds. Indeed private MFs saw a net inflow
18

of Rs. 7819.34 crore during the first nine months of the year as against a net inflow of Rs.604.40 crore in the case of public sector funds. Mutual funds are now also competing with commercial banks in the race for retail investors savings and corporate float money. The power shift towards mutual funds has become obvious. The coming few years will show that the traditional saving avenues are losing out in the current scenario. Many investors are realizing that investments in savings accounts are as good as locking up their deposits in a closet. The fund mobilization trend by mutual funds in the current year indicates that money is going to mutual funds in a big way. The collection in the first half of the financial year 1999-2000 matches the whole of 1998-99. India is at the first stage of a revolution that has already peaked in the U.S. The U.S. boasts of an Asset base that is much higher than its bank deposits. In India, mutual fund assets are not even 10% of the bank deposits, but this trend is beginning to change. Recent figures indicate that in the first quarter of the current fiscal year mutual fund assets went up by 115% whereas bank deposits rose by only 17%. (Source: Thinktank, the Financial Express September, 99) This is forcing a large number of banks to adopt the concept of narrow banking wherein the deposits are kept in Gilts and some other assets which improves liquidity and reduces risk. The basic fact lies that banks cannot be ignored and they will not close down completely. Their role as intermediaries cannot be ignored. It is just that Mutual Funds are going to change the way banks do business in the future.

Banks v/s Mutual Funds Returns Administrative exp. Risk BANKS Low High Low MUTUAL FUNDS Better Low High

19

STRUCTURE OF MUTUAL FUNDS


Sponsor Company
Managed by a Board of Trustees
Establishes MF as a Trust Registers MF with SEBI

Mutual Fund

Hold Unit holders Fund in MF Ensure Compliance to SEBI Enter into Agreement with AMC

Appointed by Board of Trustees

Asset Management Company

Float, MF Funds Managers Fund as Per SEBI guidelines & AMC Agreement

Appointed by Trustees

Custodian

Provides Necessary Custodian Services

Appointed by AMC

Bankers

Provide Banking Services

Appointed by AMC

Registrars and Transfer Agents

Provide Registrars Services and act as a Transfers Agents

The formation and operations of mutual funds in India is solely guided by SEBI (Mutual Fund) Regulations, 1993, which came into force on 20 January 1993. The regulations have since been replaced by the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, through a notification on 9 December 1996 (Appendix 2). Figure gives an idea of the structure of Indian mutual funds. A mutual fund comprises four separate entities, namely sponsor, mutual fund trust, AMC and custodian. They are of course

20

assisted by other independent administrative entities like banks, registrars and transfer agents. We may discuss in brief the formation of different entities, their functions and obligations. The sponsor for a mutual fund can by any person who, acting alone or in combination with another body corporate establishes the mutual fund and gets it registered with SEBI. The sponsor is required to contribute at least 40 per cent of the minimum net worth (Rs 10 crore) of the asset management company. The sponsor must have a sound track record and general reputation of fairness and integrity in all his business transactions. As per SEBI Regulation, 1996, a mutual fund is to be formed by the sponsor and registered with SEBI. A mutual fund shall be constituted in the form of a trust and the instrument of trust shall be in the form of a deed, duly registered under the provisions of the Indian Registration Act, 1908, executed by the sponsor in favors of trustees named in such an instrument. The board of trustees manages the mutual fund and the sponsor executes the trust deeds in favors of the trustees. The mutual fund raises money through sale of units under one or more schemes for investing in securities in accordance with SEBI guidelines. It is the job of the mutual fund trustees to see that the schemes floated and managed by the AMC appointed by the trustees, are in accordance with the trust deeds and SEBI guidelines. It is also the responsibilities of the trustees to control the capital property of mutual funds schemes. The trustees have the right to obtain relevant information from the AMC, as well as a quarterly report on its activities. They can also dismiss the AMC under specific condition as per SEBI regulations. At least half the trustees should be independent persons. The AMC or its employees cannot act as a trustee. No person who is appointed as a trustee of a mutual fund can be appointed as a trustee of any other mutual fund unless he is an independent trustee and prior permission is obtained from the mutual fund in which he is a trustee. The trustees are required to submit halfyearly reports to SEBI on the activities of the mutual fund. The trustees appoint a custodian and supervise their activities. The trustees can be removed only with prior approval of SEBI. As per SEBI guidelines, an asset management company is appointed by the trustees to float the schemes for the mutual fund and manage the funds raised by selling units under a scheme. The AMC must act as per SEBI guidelines, trust deeds and management agreement between trustee & the AMC. List of AMCs

21

Benchmark Mutual Fund Birla, Sun Life Mutual Fund BOB Mutual Fund, BOI Mutual Fund, Can bank Mutual Fund, Chola Mutual Fund, Deutsche Mutual Fund, DSP Merrill Lynch Mutual Fund, GIC Mutual Fund, HDFC Mutual Fund, HSBC Mutual Fund, ING Savings Trust Mutual Fund, JP Morgan Mutual Fund, Alliance Capital, Mutual Fund, JM Mutual Fund, Kotak Mahindra Mutual Fund, LIC Mutual Fund, Morgan Stanley Mutual Fund, PNB Mutual Fund, Principal Mutual Fund, Prudential ICICI Mutual Fund, Reliance Capital Mutual Fund, SBI Mutual Fund, Standard Chartered Mutual Fund, Sundaram Mutual Fund, Tata Mutual Fund, Taurus Mutual Fund, Franklin Templeton Mutual Fund, Unit Trust of India, UTI Mutual Fund, , Alliance Capital Mutual Fund. SEBI GUIDELINES (BRIEFLY) Schemes of a Mutual Fund: fees. The offer document shall contain disclosures which are adequate in order to enable the investors to make the investment decision including the disclosure on maximum investments proposed to be made by the scheme in the listed securities of the groups companies of the sponsor A close-ended scheme shall be fully redeemed at the end of the maturity period. unless a majority of the unit holders otherwise decide for its rollover by passing a resolution. 1. 2. The mutual fund and asset management company shall be liable to refund the If the mutual fund fails to receive the minimum subscription amount referred to in If the moneys received from the applicants for units are in exceeded subscription application money to the applicants;clause (a) of sub-regulation (1); as referred to in clause (b) of sub-regulation (1) The asset management company shall issue to the applicant whose (uncompleted) The asset Management Company shall launch no scheme unless the trustees Every mutual fund shall along with the offer document of each scheme pay filing approve such scheme and a copy of the offer document has been filed with the Board.

Rules Regarding Advertisement:

22

The offer document and advertisement materials shall not be misleading or contain

any statement or opinion, which are incorrect or false. Investment Objectives and Valuation Policies: The price at which the units may be subscribed or sold and the price at which such units any time be repurchased by the mutual fund shall be made available to the investors. General Obligations: Every asset management company for each scheme shall keep and maintain proper books of accounts, records and documents, for each scheme so as to explain its transactions and to disclose at any point of time the financial position of each scheme and in give a true and fair view of the state of affairs of the fund and intimate to the Board the place where such books of account, records and document are maintained. The financial year for all the schemes shall end as of March 31 of each year. Every mutual or the asset Management Company shall prepare in respect of each financial year an annual report and annual statement of accounts of the schemes and the fund as specified in Eleventh schedule. Every mutual fund shall have the annual statement of accounts guided by an auditor who is not any way associated with the auditor of the asset management company. Proactive For Action in Case Of Default: On and from the date of the suspension of the certificate or the approval as the case may be the mutual fund, trustees or asset management company, shall cease to carry on any activity as mutual fund, trustees or asset management company, during the period of suspension, and shall be subject to the directions of the Board with regard to any records, documents, or securities that may be in its custody of control, telling to its activities as mutual fund, trust asset management company.

Restrictions On Investments:

23

A mutual fund scheme shall not invest more than 15% of its NAV In debt

instruments issued by a single issuer, which are rated not below investment grade by a credit rating agency authorized to of the scheme with the prior approval of the Board of Trustees and the Board of asset management company y.

A mutual fund scheme shall not invest more than 10% of its NAV in unrated debt

instruments issued by a single issuer and the total investments in such not exceed 25% of the NAV of the Board of asset Management Company. No mutual fund under all its schemes should own more than ten per cent of any Such transfers are done at the prevailing market price for quoted Instruments on companys. paid up capital carrying voting rights, spot basis, The securities so transferred Shall be in conformity with the investment objective of the scheme to which such transfer has been made. A scheme may invest in another scheme under the same asset management company or any other mutual fund without charging any fees , provided that aggregate interschmes investment made by all schemes under the same management of any other asset management company shall not exceed 5% of the net asset value of the mutual fund . The initial issue expansion in respect of any scheme may not exceed six per cent of Every management company shall buy and sell securities on the basis of deliveries and the funds raised under that scheme. shall in all cases of purchases, take delivery of relative securities and in all cases of sales, deliver the securities and shall in no case put itself in a position whereby it Has to make short sale or carry forward transaction or engage in bad finance. Every management company shall, get the securities purchased or transferred in the name of the mutual fund on account of the concerned scheme, wherever investments are intended to be of long-term nature. Pending deployment of funds of a scheme in securities in terms of investment objective is of the scheme a mutual fund can invest the funds, of the scheme in short term deposits of scheduled commercial banks. No mutual fund scheme shall make any investment in; I. Any unattested security of an associate or group company of the sponsor or

24

II. Any security issued by way of private placement by an associate or group company of the sponsor; or The listed securities of group companies of the sponsor which is in Excess of 30% of the net assets [of all the schemes of a mutual fund] No mutual fund scheme shall invest more than 10 per cent of its NAV in the equity shares or equity related instruments of any company. Provided that, the limit of 10 per cent shall not be applicable for investments in index fund or sector industry specific scheme.

INVESTORS RIGHTS AND OBLIGATIONS


Investors Rights: The offer document of a scheme lays down the investors rights. Investors are the owners of the schemes assets, and it is therefore imperative that they are aware of their rights with respect to the schemes assets, its management, recourse to the trustees, the AMC and other constituents. The important rights of the unit-holders are outlined below: Unit-holders have a proportionate right in beneficial ownership of the schemes assets otherwise held in trust for them by the Trustees of the fund. They also have the proportionate right to any dividend or income declared under the scheme. Unit-holders have the right to obtain from the trustees any information that may Unit-holders are entitled to receive dividend warrants within 42 days of the date of The appointment of an AMC of a fund can be terminated by 75% of the unithave an adverse bearing on their investments. dividend declaration. holders of the scheme present and voting at a special meeting that can be called for the purpose with the prior approval of SEBI. Unit-holders have the right to inspect major documents of the fund i.e. material contracts (the trust deed, the investment management agreement, the custodian services agreement and the registrar and transfer agency agreement), memorandum and articles of association of the

25

AMC, recent audited financial statements, the texts of SEBI (MF) Regulations, Indian Trusts Act and the offer document of the scheme. Investors have the right to approve any changes in the fundamental attributes of a closed-end scheme (type of scheme, investment objective and terms of issue), provided the consent of 75% of unit-holders has been obtained. In case of open-end schemes they have the right to be adequately informed of such changes, so they can exercise the option redeeming their holdings in the fund. Each unit-holder has the right to receive a copy of the annual financial statements, and periodic statements regarding his transactions (purchase, redemption, transfer), distributions and reinvestments. Legal Limitations to Investors Rights Investors need to note that while they enjoy several rights as outlined above, they are also subject to certain limitations in their capacity as unit-holders. Unit-holders are not distinct from the trust and therefore cannot sue the trust i.e. they do not have legal recourse to the trust as, under Indian law, the Trust is not a district or separate legal entity. However, an investor can initiate legal proceedings against the trustees who are the protectors of the investors interests, if they feel aggrieved by any action of the trustees that is seen not to be in their interest. Also, the fundamental concept of a mutual fund is that the investors invest as their own risk and cannot force the AMC to assure a specified level of return. In other countries, mutual funds, do not offer assured return schemes, as any profits or losses on fund investments in any case belong to the investors. In India, in the initial stages of development of the fund industry, some of the fund sponsors have, however, offered such assured returns to investors. But, the investors need to understand that except in certain circumstances the sponsors of a mutual fund do not have any legal obligation to meet the shortfall in case the assured return is not achieved. Since assured return schemes do exist in India, an exception has been made by SEBI in case of schemes where such assurance is provided in the offer document, with a guarantee from the sponsor to meet any shortfall. Only if the offer document has specifically provided such guarantee by a named sponsor, the investors will have the right to sue the sponsors to make good any shortfall in promised returns.

26

A prospective investor does not enjoy any standing or rights with respect to the fund, the AMC or any other constituent. It is only after he has invested in a scheme that he becomes entitled to the rights discussed earlier. The courts have also upheld this view in relevant cases in India. In case a unit-holder is aggrieved by any actions of the Fund or AMC, the appropriate form for him to approach is SEBI as mentioned below. Investors Obligations It is the investors duty to carefully study the offer document before investing in units of a scheme. He must appreciate the fundamental attributes of the scheme, the risk factors, his rights and the funds and the sponsors track record. Failure to effectively study the offer document does not entitle him later to have recourse to the fund, the trustees or the AMC. The investor must also monitor his investment in a scheme by carefully studying the schemes financial statements, its portfolio composition and research reports published by mutual fund tracking agencies. He can certainly exercise in a reasonable way his right to ask the trustees for information that he requires. But, the monitoring is entirely the investors own responsibility. Investor Complaints Redressal Mechanism SEBI does entertain receipt of complaints against mutual funds and intervenes with fund managements to help the investor resolve his complaints. Another manner in which SEBI helps the investors in a new scheme is by requiring the sponsors of a new scheme to appoint a Compliance Offer who must issue a Due Diligence Certificate to the effect that all relevant SEBI and other regulations have been compiled with by the fund managers and sponsors. In rare cases involving frauds by the Directors of an Asset Management Company, investors may have the recourse to the regulators under the Companies Act such as the Department of Company Affairs or even the Company law Board. These regulators have helped with the cases of investors who did not receive the refunds of company deposits. However, the fund investors are neither shareholder in the AMC nor depositors, hence, their investments cannot be protected by any of these Companies Act regulators. Investors can at best remove the AMCs prosecuted. But, clearly, such recourse would be very rate. In any case, SEBI and all other regulators take great care to ensure that only persons of integrity serve as AMC Directors or Fund Trustees, and only companies with track record in investment management are given recognition
27

to manage funds. That is why Mutual Funds are probably the most highly regulated intermediary in financial markets, and a prime purpose of a regulating agency like the SEBI is Investor Protection.

Accounting and Valuation:


The Importance of Accounting Knowledge The balance sheet of a mutual fund is different from the normal balance sheet of a bank or a company. All of the fund's assets belong to the investors and are held in fiduciary capacity for them. Mutual fund employees and mutual fund agents need to be aware of the special requirements concerning accounting for the fund's assets, liabilities and transactions with investors and other outside constituents such as banks, securities custodians and registrars. This knowledge will help them better understand their responsibilities and their place in the organization, by getting an overview of the functioning of the fund, and to explain the performance of mutual funds to investors. Mutual funds in India are required to follow the accounting policies laid down in SEBI (Mutual Fund) Regulations, 1996 and the amendments in 1998. This section of the workbook summarizes the important Regulations, and periodical budgets. Net Asset Value (NAV) A mutual fund is a common investment vehicle where the assets of the fund belong directly to the investors. The fund does not account for investors' subscriptions as liabilities or deposits but as Unit Capital. On the other hand, the investments made on behalf of the investors are reflected on the assets side and are the main constituent of the balance sheet. There are, however, liabilities of a strictly short-term nature that may be part of the balance sheet. The fund's Net Assets are therefore defined as the assets minus the liabilities. As there are many investors in a fund, it is common practice for mutual funds to compute the share of each investor on the basis of the value of Net Assets Per Share/Unit, commonly known as the Net Asset Value (NAV).

The following are the regulatory requirements and accounting definitions lay down by SEBI. NAV = Net Assets of the scheme / Number of Units Outstanding, i.e.

28

Market value of investments + Receivables + Other Accrued Income + Other Assets =Accrued Expenses - Other Payables - Other Liabilities No. of Units Outstanding as at the NAV date A fund's NAV is affected by four sets of factors: -- Purchase and sale of investment securities -- Valuation of all investment securities held -- Other assets and liabilities, and -- Units sold or redeemed Pricing of Units: Although NAV per share defines the value of the investor's holding in the fund, the fund may not repurchase the investor's units at the same price as NAV. However, SEBI requires that the fund must ensure that repurchase price is not lower than 93% of NAV (95% in the case of a closed end fund). On the other side, a fund may sell new units at a price that is different from the NAV, but the sale price cannot be higher than 107% of NAV. Also, the difference the repurchase price and the sale price of the unit is not permitted to exceed 7% of the sale price. Fees and Expenses: An AMC may incur many expenses specifically for given schemes, and other common expenses. In any case, all expenses should be clearly unidentified and allocated to the individual schemes. The AMC may charge the scheme with investment management and advisory fees that are fully disclosed in the offer document subject to the following limits: @ 1.25% of the first Rs. 100 crore of weekly average net assets outstanding in the For no load schemes, the AMC may charge an additional management fee upto 1% accounting year, and @ 1% of weekly average net assets in excess of Rs. 100 crore. of weekly average net assets outstanding in the accounting year Investment management and advisory fees are subject to the overall ceiling for expenses discussed in 6.1.4.3 below.

29

A. Initial expenses of launching schemes (not to exceed 6% of initial resources raised under the scheme); and B. Recurring expenses including: i. marketing and selling expenses including agents' commission ii. Brokerage and transaction costs iii. Registrar services for transfer of units sold or redeemed v. fees and expenses of trustees v. audit fees vi. Custodian fees vii. Costs related to investor communication viii. Costs of fund transfers from location to location ix. Costs of providing account statements and dividend / redemption cheques and warrants x. insurance premium paid by the fund xi. Winding up costs for terminating a fund or a scheme xii. Other costs as approved by SEBI The total expenses charged by the AMC to a scheme, excluding issue or redemption expenses but including investment management and advisory fees, are subject to the following limits: on the first Rs. 100 crores of average weekly net assets-2.5% on the next Rs. 300 crores of average weekly net assets- 2.25% on the next Rs. 300 crores of average weekly net assets -2.0% on the balance of average weekly net assets-1.75%

For bond funds, the above percentages are required to be lower by 0.25%

\Initial Issue Expenses: When a scheme is first launched, the AMC will incur significant expenses, whose benefit will accrue over many years. All expenses cannot, therefore, be charged to a scheme in the first year itself. SEBI permits "amortization" of initial expenses as follows:

30

For a closed-end scheme floated on a 'load' basis, the initial issue expenses shall be

amortized on a weekly basis over the period of scheme. For example, a 5 year (i.e. 260 week) closed-end scheme with initial issue expenses of Rs. 5 lakhs must charge Rs.1923 (5 lakhs / 260 weeks) every week to the fund. It cannot charge the entire amount of Rs. 5 lakhs at the time of issue. For an open-end scheme floated on a 'load' basis, initial issue expenses may be amortised over a period not exceeding five years. For example, if an open-end scheme has initial issue expenses of Rs. 10 lakhs, it need not charge this entire amount to the fund in the year of issue. Instead, it may charge Rs. 2 lakhs (10 lakhs / 5 years) per year to the fund, thereby spreading the charge of initial issue expenses over a maximum of 5 years. Issue expenses incurred during the life of an open-end scheme cannot be amortised.

Unamortized portion of initial issue expenses shall be included for NAV

calculation, considered as "other asset". The investment advisory fee cannot be claimed on this asset. Hence, they have to be excluded while determining the chargeable investment management / advisory fees. While calculating the maximum amount of chargeable expenses, the unamortized portion of the initial issue expenses will not be included as part of the average weekly net assets figure. Accounting Policies:

Investments are required to be marked to market using market prices. Any Dividend received by the fund on a share should be recognized, not on the date of

unrealized appreciation cannot be distributed, and provision must be made for the same.

declaration, but on the date the share is quoted on ex-dividend basis. For example, if a fund owns shares on which dividend is declared on April 5, and the shares are quoted on ex-dividend basis on April 20, the dividend income will be included by the fund for distribution/NAV computation only April 20.

In determining gain or loss on sale of investments, the average cost method must Purchase / sale of investments should be recognized on the trade date and not

be followed to determine the cost of purchase. This will be applied by security. settlement date

31

Bonus / rights shares should be recognized only when the original shares are Income receivable on investments, which is accrued, but not received for 12

traded on the stock exchange on an ex-bonus /ex-rights basis investment

months beyond due date, should be provided for, and no further accrual should be made for such An investment shall be regarded as non-performing if it has provided no returns Investments owned by mutual funds are marked to market. Therefore, the value of

through dividend/interest for more than 2years at the end of the accounting year investments appreciates or depreciates based on market fluctuations, which is reflected in the balance sheet. However, this change in value constitutes unrealized gain/loss. When any investments are actually sold, the proportion of the unrealized gain / loss that pertains to such investments becomes realized gain/loss. Therefore, at any given time, the NAV includes realised and unrealised gain/loss on investments. While SEBI prohibits the distribution of unrealised appreciation on investments, realised gain in available for distribution. An open-end scheme sells and repurchases units on the basis of NAV. SEBI therefore prescribes the use of an equalization account, to ensure that creation / redemption of units does not change the percentage of income distributed. This involves the following steps: Computation of distributable reserves: Income+Realised Gain on Investments- Expenses-Unrealised Losses (unrealised

gains are excluded) - If distributable reserves are positive, the following percentage is computed: Distributable Reserve / Units Outstanding - The above percentage is multiplied with the number of new units sold, and the equalisation account is credited by this amount, if units are sold above par; if the units are sold below par, the equalisation account is debited by this amount. The same percentage is multiplies with the number of units repurchased, and the equalisation account is debited by this amount if the units are repurchased above par; if the units are repurchased below par, the equalisation account is credited. -The net balance in the equalisation account is transferred to the profit and loss account. It is only an adjustment to the distributable surplus and does not affect the net income for the period.

32

VALUATION
Mutual funds value their investments on a 'mark-to-market' basis with reference to the date on which they are valued i.e., the valuation date.

Valuation of Traded Securities: Where a security is traded on a stock exchange, it is valued at the last quoted If a security is not traded on any stock exchange on a particular valuation day, the closing price on the stock exchange where it is "principally traded". value at which it was traded on the selected/other stock exchange on the earliest previous day may be used, provided such date is not more than 60 days prior to the valuation date. Valuation of traded securities, once the market price is obtained as above, is quite simple. The fund will multiply its current holding in number of shares or bonds by the applicable market price to get the "mark to market" value.

Valuation of Non-traded Securities: When a security is not traded on any stock exchange for 60 days prior to the Non-traded securities shall be valued 'in good faith' by the AMC on the basis of valuation date, it must be treated as a 'non-traded' scrip. appropriate valuation methods, which shall be periodically reviewed by the trustees and reported by the auditors as fair and reasonable. The following principles are to be applied for the valuation of non-traded securities:

33

Equity instruments: are to be valued on the basis of capitalisation of earnings

solely or in combination with its balance sheet Net Asset Value. For this purpose, capitalisation rate will be determined by

reference to the price or earning rations of comparable traded securities with an appropriate discount for lower liquidity to be used.

Debit instruments: are to be valued on a yield to maturity basis, the capitalisation

factor being determined for comparable traded securities with an appropriate discount for lower liquidity.

Call money, bills purchased under rediscounting and short term deposits with

banks are to be valued at cost + accrual: other money market instruments at yield at which they are currently traded; non-traded instruments (not traded for 7 days) will be valued at cost plus interest accrued till the beginning of the valuation day plus the difference between redemption value and cost, spread uniformly over the remaining maturity of the instruments

Government Securities are to be valued at yield to maturity based on prevailing

market rate

Convertible debentures and bonds: non-convertible component is to be valued

as a debt instrument, and convertible as any equity instrument. If after conversion, the resultant equity instrument would be traded pari passu with an existing instrument which is traded, the value of the latter instrument can be adopted after an appropriate discount for the non-tradability of the instrument.

Instruments bought on 'repo' basis must be valued at the resale price minus

interest up to the date of resale.

34

Valuation Models
Where the securities are traded and their prices are quoted on the markets, they are valued by "mark to market" method using the market prices. However, untraded securities do pose a problem. While the above Regulations give the principles of valuation for untraded securities, agencies such as I-Sec and Crisil have developed valuation models which have been implemented at some of the mutual funds with operations in the country. However, these models have yet to gain complete acceptance by the funds, and have thus far been used by them as tools to supplement valuations based on internal methods approved by their Boards and reviewed by their Trustees. Hence these models have not been disscussed separately. RISK INVOLVED IN MUTUAL FUNDS INDUSTRY Mutual funds are not free from risk. It is so because basically the mutual funds also invest their funds in stock markets on shares, which are volatile in nature and are not risk free, the following risk are inherent in their dealing.

INHERENT RISK FACTORS:


1) Market Risks: In general there are certain risks associated with the every kind of investment on shares. They are called market risks. These market risks can be reduced, but cannot be completely eliminated even by a good investment. The prices of shares are subjected to wide price fluctuations depending upon market conditions over which nobody has a control. Moreover, every economy has to pas through a cycle-Boom, Recession, Slump and Recovery. The phase of the business cycle affects the market conditions toa large extent.

35

2) Scheme Risks There are certain risks inherent in the scheme itself. It all depends upon the nature of the scheme. For instance, in a pure growth scheme, risks are greater. 3) Investment Risks Whether the mutual fund makes money in shares or loses depends upon the investment expertise of the Asset Management Company. If the investment advice goes wrong, the fund has to suffer a lot. The investment expertises of various funds are different and it is reflected on the returns, which they offer to investors. 4) Business Risks The corpus of a mutual fund might have been invested in a companys shares. If the business of that company suffers any set back, it cannot declare any dividend. It may even go to the extent of winding up its business. Though the mutual fund can withstand such a risk, its income paying capacity is affected. 5) Political Risks Successive Governments bring with them fancy new economic ideologies and policies. It is often said that many economic decisions are politically motivated. Changes in Government bring in the risk of uncertainty which every player in the financial service industry has to face. So mutual funds are no exception to it.

36

CHAPTER-3

37

COMPANY PROFILE

38

Bajaj Capital is one of Indias leading Financial Services companies offering Free Advice on Investments, Insurance, Tax Saving, Retirement Planning, Financial Planning, Childrens Future Planning and other services. They also have a wide range of products and services for Corporates, High Net worth Individuals, and NRIs all under one roof. At Bajaj Capital, they believe in dreaming big. Dreams inspire us to excel. They ignite hope and kindle in us the passion to stretch our limits. We also believe that nothing can or should stop us from realising our dreams and financial constraints should be the last thing to stop anyone. Four decades of excellence For over four decades, they have been helping people realise their aspirations by helping them make their wealth grow, and plan their financial lives. Today, they are a one of the largest financial planning and investment advisory companies in India, with a strong presence all over the country. They take pride in serving our customers both individual and institutional and are known for our strong professionalism and work ethics. Wide range of services They offer a comprehensive range of services including financial planning and investment advice, and the entire gamut of financial instruments and investment products of almost all major companies, both public and private. In addition, they also provide investment assistance by helping you complete all the formalities, and help you keep regular track of your investments. These services and products are delivered through our network of 109 Bajaj Capital Investment Centers located all over the country. They are also a SEBI-approved Category I Merchant Banker. They raise resources for over 1,000 top institutions and corporate houses every year, and offer specialised services to NonResident Indian (NRIs) and High Net worth Clients.

39

The History of Bajaj Capital Bajaj Capital has contributed to the growth of the Indian Capital Market at every step. In 1965, they were the first to innovate the Companies Fixed Deposit. Today, we are playing an active role in the growth of the Indian Mutual Fund industry. They are also working closely with private insurance companies to deepen India's insurance market. Here is a brief gist of our journey through the years. 1964 Bajaj Capital sets up its first Investment Centre in New Delhi to guide individual investors on where, when and how to invest. India's first Mutual Fund, Unit Trust of India (UTI) is incorporated in the same year. 1965 Bajaj Capital is incorporated as a Company. In the same year, the company introduces an innovative financial instrument the Company Fixed Deposit. EIL Ltd. (Oberoi Hotels, then known as Associated Hotels of India Ltd.) becomes the first company to raise resources through Company Fixed Deposits. 1966 Bajaj Capital expands its product range to include all UTI schemes and Government saving schemes in addition to Company Fixed Deposits. 1969 Bajaj Capital manages its first Equity issue (through an associate company) of Grauer & Wells India Ltd.; right from drafting the prospectus to marketing the issue. 1975 Bajaj Capital starts offering 'need-based' investment advice to investors, which would later be known as 'Financial Planning' in the investment world. 1981 SAIL becomes the first government company to accept deposits, followed by IOC, BHEL, BPCL, HPCL and others; thus opening the floodgates for growth of retail investment market in India. Bajaj Capital plays an active role in all the schemes as 'Principal Brokers'

40

1986 Public Sector Undertakings (PSUs) begin making public issues of bonds MTNL, NHPC, IRFC offer a series of Bond Issues. Bajaj Capital is among the top ranks of resource mobilisers. 1987 SBI leads the launch of Public Sector Mutual Funds in India. Bajaj Capital plays a significant role in fund mobilisation for all these players. 1991 SBI issues India Development Bonds for NRIs. Bajaj Capital becomes the top mobiliser with collections of over US $20 million. 1993 The first private sector Mutual Fund Kothari Pioneer is launched, followed by Birla and Alliance in the following years. Bajaj Capital plays an active role and is ranked among the top mobilisers for all these schemes. 1995 IDBI and ICICI begin issuing their series of Bonds for retail investors. Bajaj Capital is the comanager in all these offerings and consistently ranks among the top five mobilisers on an all-India basis.

1997 Private sector players lead the revival of Mutual Funds in India through Open-ended Debt schemes. Bajaj Capital consolidates its position as India's largest retail distributor of Mutual Funds.

1999 Bajaj Capital begins marketing Life and General Insurance products of LIC and GIC (through associate firms) in anticipation of opening up of the Insurance Sector. Bajaj Capital achieves the milestone of becoming the top 'Pension Scheme' seller in India and launches marketing of GIC's Health Insurance schemes.

41

2000 Bajaj Capital implements its vision of being a 'One-stop Financial Supermarket.' The Company offers all kinds of financial products, including the entire range of investment and insurance products through its Investment Centers. Bajaj Capital offers 'full-service merchant banking' including structuring, management and marketing of Capital issues. Bajaj Capital reinvents 'Financial Planning' in its international sense and upgrades its entire team of Investment Experts into Financial Planners.

2002 The Company focuses on creating investor awareness for Financial Planning and need-based investing. To achieve this goal, the companyintroduced the International College of Financial Planning. The graduates of this institute become Certified Financial Planners (CFPs), a coveted professional qualification.

2004 Bajaj Capital obtains the All India Insurance Broking Licence. Simultaneously, a series of wealth creation seminars are launched all over the country, making Bajaj Capital a household name.

2005 Bajaj Capital launches 360 Financial Planning, a software-based programme aimed at encouraging scientific and holistic investing.

List of Network Branches:

42

Bajaj Capital has more than 120 branches in India which has been penerated all over the country to provide the best of its services in each and every zone.

43

CHAPTER-4

44

DATA ANALYSIS AND INTERPRETATION

SELECTED AMC S -BRIEF INTRODUCTION

45

Reliance Mutual Fund Reliance Mutual Fund (RMF) has been established as a trust under the Indian Trusts Act, 1882 with Reliance Capital Limited (RCL), as the Settlor/Sponsor and Reliance Capital Trustee Co. Limited (RCTCL), as the Trustee. RMF has been registered with the Securities & Exchange Board of India (SEBI) vide registration number MF/022/95/1 dated June 30, 1995. The name of Reliance Capital Mutual Fund has been changed to Reliance Mutual Fund effective 11th. March 2004 vide SEBI's letter no. IMD/PSP/4958/2004 date 11th. March 2004. Reliance Mutual Fund was formed to launch various schemes under which units are issued to the Public with a view to contribute to the capital market and to provide investors the opportunities to make investments in diversified securities.

The main objectives of the Trust are:

To carry on the activity of a Mutual Fund as may be permitted at law and formulate and devise various collective Schemes of savings and investments for people in India and abroad and also ensure liquidity of investments for the Unit holders;

To deploy Funds thus raised so as to help the Unit holders earn reasonable returns on their savings and To take such steps as may be necessary from time to time to realise the effects Key Personnel Mr. Kanadoshi (Chairman), Mr. Amitabh jhunjhunwala (MD) Ms sulsjja motwani (Joint M.D).

UTI MUTUAL FUND.

46

UTI Mutual Fund is managed by UTI Asset Management Company Private Limited (Estb: Jan 14, 2003) who has been appointed by the UTI Trustee Company Private Limited for managing the schemes of UTI Mutual Fund and the schemes transferred / migrated from UTI Mutual Fund. The UTI Asset Management Company has its registered office at : UTI Tower, Gn Block, Bandra - Kurla Complex, Bandra (East), Mumbai - 400 051 will provide professionally managed back office support for all business services of UTI Mutual Fund (excluding fund management) in accordance with the provisions of the Investment Management Agreement, the Trust Deed, the SEBI (Mutual Funds) Regulations and the objectives of the schemes. State-of-the-art systems and communications are in place to ensure a seamless flow across the various activities undertaken by UTI AMC. UTI AMC is a registered portfolio manager under the SEBI (Portfolio Managers) Regulations, 1993 on February 3 2004, for undertaking portfolio management services and also acts as the manager and marketer to offshore funds through its 100 % subsidiary, UTI International Limited, registered in Guernsey, Channel Islands. UTI Mutual Fund has come into existence with effect from 1st February 2003. UTI Asset Management Company presently manages a corpus of over Rs.20000 Crore. UTI Mutual Fund has a track record of managing a variety of schemes catering to the needs of every class of citizenry. It has a nationwide network consisting 56 UTI Financial Centres (UFCs) and representative offices in Dubai and London. With a view to reach to common investors at district level, 11 satellite offices have also been opened in select towns and districts. It has a well-qualified, professional fund management team, who has been highly empowered to manage funds with greater efficiency and accountability in the sole interest of unit holders. The fund managers are also ably supported with a strong in-house equity research department. To ensure better management of funds, a risk management department is also in operation.

47

It has reset and upgraded transparency standards for the mutual funds industry. All the branches, UFCs and registrar offices are connected on a robust IT network to ensure cost-effective quick and efficient service. All these have evolved UTI Mutual Fund to position as a dynamic, responsive, restructured, efficient, and transparent and SEBI compliant entity Key Personnel Mr. U.K Sinha (Chairman& M.D), Mr. D.S R Murthy (Executive Director), Mr. Intaiyazul Rahaman (Chief Finance Officer).

HDFC ASSET MANAGEMENTCOMPANYPVT. LTD HDFC Asset Management Company Ltd (AMC) was incorporated under the Companies Act, 1956, on December 10, 1999, and was approved to act as an Asset Management Company for the HDFC Mutual Fund by SEBI on June 30, 2000. The registered office of the AMC is situated at Ramon House, 3rd Floor, H.T. Parekh Marg, 169, Backbay Reclamation, Churchgate, Mumbai - 400 020. In terms of the Investment Management Agreement, the Trustee has appointed the AMC to manage the Mutual Fund. As per the terms of the Investment Management Agreement, the AMC will conduct the operations of the Mutual Fund and manage assets of the schemes, including the schemes launched from time to time Key Personnel Mr. Deepak parekh (Chairman), Mr. N.Keith Steoch ( C E O) Mr. Mar Connolly (Executive Director).

48

TEMPLETON ASSET MANAGEMENT (INDIA) PVT. LTD. Templeton Asset Management Company, a company incorporated under the Companies Act, 1956, is a part of the Franklin Templeton Group. The sponsor of the Fund Templeton International Inc., is a wholly owned subsidiary of Templeton Worldwide Inc., which in turn is a wholly owned subsidiary of Franklin Resources Inc. The Franklin Templeton Group is one of the world s largest Investment Management Companies. It has over 50 years of experience in International Investment Management with 34 offices in over 23 countries, which service over 10 million unit holders. Templeton started operations in Mumbai, India in January 1996.Templeton in India has 8 different funds. Templeton has eleven offices including Mumbai, Delhi, Calcutta, Pune, Chennai, Bangalore, Cochin and Hyderabad. Key Personnel Ravi Malhotra (Chairman), Deepak Satwaleka (MD - Asia), B. Swaminathan (Director & CO). SBI MUTUAL FUND.

SBI Mutual Fund draws strength from India's premier and largest bank; the State Bank of India. Set up on July 1, 1955, the State Bank of India is the largest banking operation in the country. Through years of commitment to service and national development, SBI has grown into an instrument of social change. Today, it has 9,039 branches in India (excluding 4599 branches of banking subsidiaries) and 54 offices in 28 countries spread over all time zones. SBI entered into a Memorandum of Understanding with Socit Gnrale Asset Management (SGAM), which offers retail investors, corporate clients and institutional investors a wide range of investment products. SGAM is a dominant player in Global Mutual Fund arena

49

with presence in over 20 countries spanning Europe, United Sates, and Asia, managing over 250 billion Euros in assets

Key Personnel Mr Deepak Chawla (M.D), Mr. Didier Turpin (C.E.O), Mr. Ganti N. Murthy ( Fund Manager). PARTICULARS OF AMCS: PARTICULARS No. of schemes No. of schemes including options Equity Schemes Debt Schemes Short term debt Schemes Equity & Debt Gilt Fund PORTFOLIO MEASUREMENT METHODS: We are interested in discovering if the management of a mutual fund is performing well; that is, has management done better through its selective bying and selling of securities than would have been achieved through merely buying the market picking a large number of securities randomly and holding them throughout the period? The most popular ways of measuring managements performance are 1. Sharpes Performance Measure 2. Treynors Performance Measure 3. Jensens Performance Measure RELIANCE 31 59 20 06 07 02 09 UTI 15 59 15 26 02 04 02 HDFC 13 27 10 07 03 02 06 SBI 25 56 16 08 05 03 04 F&T 56 95 33 13 11 07 10

Sharpes Performance Measure (Sharpe ratio or Reawrd to variability ratio)


50

William Sharpe has attempted to get a summary measure of portfolio performance. His measure properly adjusts performance for risk. The Sharpe Index is given by: Si = ri r* i where Si = Sharpe Index ri = average return on protfolio t r* = riskless rate of interest i = standard deviation (risk) of the returns of portfolio While a high and positive Sharpe ratio shows a superiors risk adjusted performance of a fund. A low and negative Sharpe ratio is an indication of unfavorable performance. Assumption: Sharpe assumes that the portfolio under the consideration is whole or substantially the whole of investors total portfolio. This mean, if any unsystematic risk is left, this cannot be eliminated Treynor performance measure (Jack Treynor): This ratio also called Treynor ratio-reward to volatility ratio. It is concerned with systematic risk () . It is relationship between reward of risk premium to the volatility of return as measured by the portfolio risk. Risk premium TP = Portfolio = persons with disability rp rf

All risk averse investors would like to maximize this value while a high and positive trainers index shows a superior risk adjusted performance of a fund, a low and negative trainers index is indication of unfavorable performance. Assumption: Portfolio is itself only as part of the total investments portfolio. eliminate any unsystematic risk as his portfolio is well diversified. So,

Jensens Performance Measure(Michael):

51

It refers the actual return earned in portfolio and return expected out of portfolio given its level of risk. CAPM is used to calculate the expected return. The difference between the expected return and act retain can be said the return earned out of the mandatory of systematic risk. This excess return referes the managers pridictive ability and managerial skills. CAPM rp = rf + (rm rf) Differential return is calculated as follows: p = rp - rp p =positive > Superior returns p = Negative > Unskilled management (worse portfolio) p = 0 > Neutral performance Higher alpha represents superior performance of a fund and vice versa.

52

CALCULATIONS OF DEBT MEASUREMENT INDEX


RELIANCE CALCUL RESULT ATION (0.780.05)/ 0.1786 4.086 (0.780.05)/0.54 5 0.05+0.78 2*(1.2190.05) UTI CALCUL ATION (0.0810.05)/0.03 8 (0.0810.05)/0.00 4 FT CALCUL ATION (-0.0840.05)/0.33 1 (-0.0840.05)/ -0.071 0.05+(0.084)*(1. 219-0.05) SBI CALCUL ATION (-0.0290.05)/0.22 8 (-0.0290.05)/ -0.019 0.05+(0.029)*(1. 219-0.05) HDFC CALCUL ATION (-0.05460.05)/0.49 7 (-0.05460.05)/0.01 55

RESULT

RESULT

RESULT

RESULT

SHARPE INDEX TREYNO R INDEX JENSEN INDEX

0.815

0.108

-0.074

0.0092

1.339

7.75

-0.47

-1.1052

-0.296

0.972

0.05+(0.08 1)*( 1.219 0.153 -0.05)

-0.1566

0.092

0.05+(0.0546)*(1 0.122 .219-0.05)

DEBT FUND MEASUREMENT


10 8 6 4 2 0 -2
RE LI AN C E HD FC UT I SB I FT

SHARPE TREYNOR JENSEN

MEASUREMENT

METHODS

SCHEMES

53

CALCULATIONS OF EQUITY MEASUREMENT INDEX


RELIANCE CALCUL RESULT ATION (0.7650.05)/1.43 0.499 2 (0.7650.05)/0.54 1 0.05+0.76 5*(1.2440.05) UTI CALCUL ATION (-0.1660.05)/6.35 58 (-0.1660.05)/0.62 5 0.05+(0.166)*(1. 219-0.05) RESULT FT CALCUL ATION (1.2240.05)/1.81 1 (1.2240.05)/0.74 5 0.05+1.22 4*(-1.2190.05) RESULT SBI CALCUL ATION (1.3660.05)/2.14 7 (1.3660.05)/0.94 3 0.05+1.36 6*(-1.2190.05) RESULT HDFC CALCUL ATION (-3.1330.05)/0.94 4 (-3.1330.05)/ -0.313 0.05+(3.133)*(1. 244-0.05) RESULT

SHARPE INDEX TREYNO R INDEX JENSEN INDEX

0.0182

0.648

0.6129

-3.265

1.321

-0.1856

1.575

1.395

9.849

0.969

0.252

1.489

1.655

-3.668

EQUITY FUND MEASUREMENT MEASUREMENT METHODS 15 10 5 0


SB I H DF C CE AN U

SHARPE TREYNOR JENSEN


TI FT

-5
R EL I

SCHEMES

54

CALCULATIONS OF BALANCE MEASUREMENT INDEX RELIANCE CALCUL ATION (0.8200.05)/2.08 4 (0.8200.05)/0.03 9 0.05+0.82 0*(1.2190.05) RESULT 0.369 19.743 1.249 UTI CALCUL ATION (0.9060.05)/1.79 4 (0.9060.05)/0.20 7 0.05+(0.90 6)*( 1.219 -0.05) RESULT 0.477 4.135 1.117 FT CALCUL ATION (36.1850.05)/210. 314 (36.1850.05)/50.0 90 0.05+36.1 85*(1.2190.05) RESULT 0.171 0.721 42.35 SBI CALCUL ATION (0.2560.05)/4.47 4 (0.2560.05)/0.32 0 0.05+0.25 6*(1.2190.05) RESULT 0.0460 0.643 0.357 HDFC CALCUL ATION (0.3400.05)/3.40 5 (0.3400.05)/ -0.199 0.05+0.34 0*(1.2190.05) RESULT 0.0851 1.457 0.455

SHARPE INDEX TREYNO R INDEX JENSEN INDEX

MEASUREMENT

BA NCE FUND M SUREM LA EA ENT


METHODS 50 40 30 20 10 0
N C E U T F T B I S LI A H D F C I

SH PE AR T EYN R R O JEN SEN

R E

SC E E HM S

55

CHAPTER-5

56

SUGGESIONS & RECOMMENDATIONS

Recommendations and Suggestions to Investors: 1) 2) 3) 4) 5) 6) 7) 8) Make clearly defined goals (should be in practical and simple manner) Prioritize the goals (classify the goals which are immediate and which Are for a later date) Find out the cost to attain the goals Prepare cash statements (If you have a idea of what are the cash out Flows and in flows) Evaluate all the investment plans and identify some expenses that can be avoided Analyze the investment opportunities Allocate fund accordingly investment objective Make systematic and periodical evolution of Mutual Funds and AMCS and change accordingly. Recent informal discussion of five Indian top five fund managers sponcered by BUSINESS STANDARD has revealed the following facts for investors. One, equity as an asset class will out perform this year. Debt funds may not be able to replicate their past performance, but may still Floating rate funds are essentially for people who do not want to take a call on

post decent returns. returns. Equities are not for people who lack patience. A 3-5 year time-frame should be the investment horizon for plunging into equity funds. The longer the duration the lasser are the chances of failure Investors should not try to outguess fund managers. Select funds which are Investors should make investments based on their risk profile, and a 20 per cent diversified and show consistency in performance. overweight to equities this year may be justifiable. interest rates even as they are looking for capital protection plus some marginal

57

Recommendations and Suggestions to AMCS: 1) Brand building: Brand building is an exercise, which every business enterprise will have. Brand is the soul of an institution; it survives on it, lives with it and cherishes it. Example: UTI has a brand, every bank, insurance companies; mutual fund companies have got their own brands.
2)

Investor education:

There if only one institution that is UTIs educational & training Institution UTI institute of capital markets 3) Strength full Strategies: Every AMC should try to turn into a more modern, a more vibrant, a more transparent and regulatory compliance institution. It is with this in mind, every institution should try to come up with verity of different type of products to fill different investment objectives. 4 Marketing tools for total quality achievement.: a) b) c) d) e) f) g)
5)

Large Network. Effective Man power Distribution across the Market Customer relations(Building better relationships) Value added service Better transparency level Building brand name as a disciplined player. Innovation:

MF industry can be classified morely into three categories like equity, debt and balanced. And there is also complexive in nature. Fund managers are not able to reach niche market. The products are should be innovative that can meet niche market. Here MF should follow the FMCG industry innovative strategy.

58

Limitations of MF - Reasons and Suggestions: No Investor confidence: Reasons: 1) Asset have been garned based on performance rather than the need of Investor. 2) No regular income or historical income. There is no guarantee that last quarters top performance will be repeated in the next quarter. 3) There is no wide product range. Most of the products can be classified into three classes, like 1) cash funds 2) income funds 3) equity funds within these there are some exotics like sector funds and gilt funds. 4) Lacked in systematic evaluation of investors requirements. 5) Lack of Market debt. 6) Lack of innovative products like other industries (FMCG). 4 Suggestions: 1) Strategies should be made to gain investors trust by way of better products, better service, Better process. 2) Innovative products in such a way which cater the specific risk-return profile of investor and Create long term investment vehicle for him/her. Recent innovation are go in such way are 5 6 7 8 a) Floating rate funds b) International investment plan c) Exchange traded funds d) Gold fund

59

Lack of efficiency in the process: Reasons: 1) There is very low opinion on the investment efficiency of the MFs 2) As investors see, the MFs are Momentum chaser rather than Professional investment managers. Suggestions: 1) MFs should try to demonstrate the effectiveness of the investment process for generating sustainable investment returns with few exceptions. 2) MFs needs to demonstrate robustness of its investment process. Others Reasons: 1) No virtual infrastructure for mobilizing from retail investors(like Banks) 2) The most investors are not good educated about capital market, they thought MF managers are financial professions can post huge absolute returns in any conditions. Suggestions: 1) MFs should seek for absolute returns rather than relative returns. Should change the mentality of investors because most investors come to specific asset class based on last quarter returns on which we can not relay. 1) Assess yourself: Self-assessment of ones needs; expectations and risk profile is of prime importance failing which; one will make more mistakes in putting money in right places than otherwise. One should identify the degree of risk bearing capacity one has and also clearly state the expectations from the investments. Irrational expectations will only bring pain. 2) Try to understand where the money is going: It is important to identify the nature of investment and to know if one is compatible with the investment. One can lose substantially if one picks the wrong kind of mutual fund. In order to avoid any confusion it is better to go through the literature such as offer document and fact sheets that mutual fund companies provide on their funds.
60

3) Don't rush in picking funds, think first: one first has to decide what he wants the money for and it is this investment goal that should be the guiding light for all investments done. It is thus important to know the risks associated with the fund and align it with the quantum of risk one is willing to take. One should take a look at the portfolio of the funds for the purpose. Excessive exposure to any specific sector should be avoided, as it will only add to the risk of the entire portfolio. Mutual funds invest with a certain ideology such as the "Value Principle" or "Growth Philosophy". Both have their share of critics but both philosophies work for investors of different kinds. Identifying the proposed investment philosophy of the fund will give an insight into the kind of risks that it shall be taking in future. 4) Invest. Dont speculate: A common investor is limited in the degree of risk that he is willing to take. It is thus of key importance that there is thought given to the process of investment and to the time horizon of the intended investment. One should abstain from speculating which in other words would mean getting out of one fund and investing in another with the intention of making quick money. One would do well to remember that nobody can perfectly time the market so staying invested is the best option unless there are compelling reasons to exit.

5) Dont put all the eggs in one basket: This old age adage is of utmost importance. No matter what the risk profile of a person is, it is always advisable to diversify the risks associated. So putting ones money in different asset classes is generally the best option as it averages the risks in each category. Thus, even investors of equity should be judicious and invest some portion of the investment in debt. Diversification even in any particular asset class (such as equity, debt) is good. Not all fund managers have the same acumen of fund management and with identification of the best man being a tough task, it is good to place money in the hands of several fund managers. This might reduce the maximum return possible, but will also reduce the risks.

61

6) Be regular: Investing should be a habit and not an exercise undertaken at ones wishes, if one has to really benefit from them. As we said earlier, since it is extremely difficult to know when to enter or exit the market, it is important to beat the market by being systematic. The basic philosophy of Rupee cost averaging would suggest that if one invests regularly through the ups and downs of the market, he would stand a better chance of generating more returns than the market for the entire duration. The SIPs (Systematic Investment Plans) offered by all funds helps in being systematic. All that one needs to do is to give post-dated cheques to the fund and thereafter one will not be harried later. The Automatic investment Plans offered by some funds goes a step further, as the amount can be directly/electronically transferred from the account of the investor. 7) Do your homework: It is important for all investors to research the avenues available to them irrespective of the investor category they belong to. This is important because an informed investor is in a better decision to make right decisions. Having identified the risks associated with the investment is important and so one should try to know all aspects associated with it. Asking the intermediaries is one of the ways to take care of the problem.

8) Find the right funds: Finding funds that do not charge much fees is of importance, as the fee charged ultimately goes from the pocket of the investor. This is even more important for debt funds as the returns from these funds are not much. Funds that charge more will reduce the yield to the investor. Finding the right funds is important and one should also use these funds for tax efficiency. Investors of equity should keep in mind that all dividends are currently tax-free in India and so their tax liabilities can be reduced if the dividend payout option is used. Investors of debt will be charged a tax on dividend distribution and so can easily avoid the payout options. 9) Keep track of your investments: Finding the right fund is important but even more important is to keep track of the way they are performing in the market. If the market is beginning to enter a bearish phase, then investors of equity too will benefit by switching to debt funds as the losses can be minimized. One can always switch back to equity if the equity market starts to show some buoyancy.

62

10) Know when to sell your mutual funds: Knowing when to exit a fund too is of utmost importance. One should book profits immediately when enough has been earned i.e. the initial expectation from the fund has been met with. Other factors like non-performance, hike in fee charged and change in any basic attribute of the fund etc. are some of the reasons for to exit. For more on it, read "When to say goodbye to your mutual fund." Investments in mutual funds too are not risk-free and so investments warrant some caution and careful attention of the investor. Investing in mutual funds can be a dicey business for people who do not remember to follow these rules diligently, as people are likely to commit mistakes by being ignorant or adventurous enough to take risks more than what they can absorb. This is the reason why people would do well to remember these rules before they set out to invest their hard-earned money.

63

CHAPTER-6

64

ANNEXURE

65

66

MUTUAL FUNDS TRACK RECORD BAJAJ CAPITAL CENTRE FOR INVESTMENT RESEARCH (As on 19-April-2008) Liquid Funds (Growth Option) Fund Size (Rs Cr) Mar 07 Fund Size (Rs Cr) Mar 08 Latest NAV 2 3 7 15 1 3 6 1 Year Year Da Da Mt Mt Mt Yea CAG CAG ys ys h hs hs r R R Absolute Returns (%) as on 19-April-2007 0.1 2 0.1 6 0.1 6 0.1 5 0.1 5 0.1 5 0.1 3 0.1 3 0.1 5 0.1 7 0.1 3 0.1 6 0.1 4 0.1 7 0.1 7 0.1 7 0.1 6 0.1 6 0.1 8 0.1 5 0.1 5 0.1 6 0.2 4 0.3 5 0.3 4 0.3 3 0.3 3 0.3 3 0.2 9 0.2 7 0.3 1 0.3 4 0.2 5 0.3 4 0.2 9 0.3 5 0.3 6 0.3 6 0.3 3 0.3 4 0.3 8 0.3 2 0.3 2 0.3 2 0.5 1 0.7 6 0.8 3 0.7 1 0.7 4 0.6 3 0.6 2 0.6 0 0.8 8 0.9 9 0.4 2 0.8 2 0.6 1 1.0 1 0.8 3 0.8 2 0.8 2 0.8 1 0.8 4 0.7 2 0.8 0 0.6 8 6.3 1 7.1 5 7.1 7 6.9 4 7.2 3 7.0 6 N. A 6.8 3 7.3 4 7.8 1 6.3 1 N. A 6.4 8 7.4 8 7.5 1 7.3 9 7.0 8 N. A 7.1 1 7.0 2 7.1 8 6.6 3

Liquid Funds - Regular Plans ABN AMRO Cash Fund - Regular Plan Birla Cash Plus - Retail Birla Sun Life Cash Manager BOB Liquid Fund Can Liquid DBS Chola Liquid Fund - Regular DSP Merrill Lynch Liquid Plus Fund DSP Merrill Lynch Liquidity Fund DWS Insta Cash Plus Fund DWS Money Plus Fund Escorts Liquid Plan Fidelity Cash Fund - Retail Grindlays Cash Fund HDFC Cash Management - Call Plan HDFC Cash Management - Saving Plan HDFC Liquid Fund HSBC Cash Fund HSBC Liquid Plus Fund Regular ICICI Prudential Liquid Plan ING Vysya Liquid Fund JM High Liquidity Fund Kotak Liquid

849.1 7 3948. 59 550.4 8 67.95 1186. 76 1000. 83 N.A 4892. 33 728.4 4 80.63 4.11 N.A 844.2 2 457.3 2 1826. 14 1739. 02 1913. 04 N.A 5661. 09 597.1 5 567.8 6 3324. 80

401.9 5 4060. 80 1598. 24 34.66 612.0 1 188.2 2 1737. 22 1978. 28 513.1 3 670.4 2 1.16 346.2 8 323.7 7 1076. 67 3347. 01 1544. 48 1880. 75 1251. 18 8460. 96 1300. 80 653.1 3 2667. 78

11.4869 20.2471 18.5043 13.4664 13.7161 15.2017 1051.51 12 18.3769 12.6495 10.8775 10.9451 10.3069 13.8437 13.0192 15.7083 14.9532 12.6722 10.4123 18.4516 15.9399 20.6903
67

1.59 3.34 1.99 3.81 2.06 3.94 1.92 3.66 1.97 3.81 1.80 3.61 1.83 3.63 1.73 3.52 2.06 3.94 2.24 4.16 1.76 3.26 2.01 N.A 1.76 3.42 2.23 4.23 2.11 4.01 2.11 3.99 2.01 3.82 2.07 3.98 2.06 3.85 1.93 3.72 2.07 3.94 1.83 3.53

5.68 6.36 6.33 6.28 6.58 6.41 N.A 6.33 6.48 N.A N.A N.A 5.85 6.29 6.59 6.45 6.24 N.A 6.27 6.20 6.11 5.91

N.A 5.77 5.77 5.74 5.99 5.86 N.A 5.83 5.91 N.A N.A N.A 5.42 5.58 6.00 5.84 5.72 N.A 5.73 5.70 5.54 5.39

14.8629

68

Principal FRF - Flexible Maturity Plan SBI Magnum Income Fund - FRF - LTP Sundaram Floating Rate Fund - LTP Tata Floating Rate Fund - Long Term Templeton Floating Rate Income Fund -LTP Avg Floating Rate Fund Short Term ABN AMRO Floating Rate Fund Regular Plan Birla Floating Rate Fund - Short Term CanFloating Rate - STP DBS Chola Short Term Floating Rate Fund DWS Floating Rate Fund Grindlays Floating Rate Fund - STP HDFC Floating Rate Income Fund - STP HSBC Floating Rate Fund - Short Term Plan ICICI Prudential FRF - Option A ICICI Prudential FRF - Option B ING Vysya Floating Rate Fund JM Floater Fund - Short Term Plan Kotak Floater - Short Term LICMF Floating Rate Fund Reliance Floating Rate Fund SBI Magnum Income Fund - FRF - STP Sundaram Floating Rate Fund - STP Tata Floating Rate Fund - Short Term Templeton Floating Rate Income Fund -STP UTI Floating Rate Fund - STP Avg Debt Funds - Short Term

167.25 30.06 13.71 8.18 779.51

156.0 7 30.22 6.88 4.81 523.5 5

11.7443 11.5496 11.3468 11.6321 13.5627

0.1 8 0.1 4 0.1 2 0.1 0 0.1 7 0.1 4 0.1 1 0.1 5 0.1 7 0.1 7 0.1 5 0.1 2 0.1 6 0.1 6 0.1 8 0.1 8 0.1 4 0.1 5 0.1 5 0.1 7 0.1 7 0.1 3 0.1 5 0.1 7 0.1 7 0.1 4 0.1 5 0.1

0.3 7 0.3 1 0.2 6 0.2 1 0.3 8 0.3 0 0.2 3 0.3 1 0.3 5 0.3 4 0.3 0 0.2 6 0.3 3 0.3 3 0.3 8 0.4 0 0.3 0 0.3 1 0.3 2 0.3 7 0.3 5 0.2 8 0.3 0 0.3 8 0.3 5 0.3 1 0.3 3 0.3

0.8 8 0.6 9 0.6 0 0.7 4 0.9 1 0.7 3 0.4 5 0.8 8 0.9 8 0.9 0 0.7 2 0.5 3 0.7 6 0.8 4 0.9 3 0.9 6 0.8 3 0.6 7 0.6 9 0.8 3 0.9 7 0.5 8 0.7 2 0.8 0 0.8 9 0.6 5 0.7 8 0.6

2.1 6 1.5 8 1.6 1 1.7 1 2.1 3 1.7 9 1.4 5 2.1 3 2.2 4 2.2 0 1.9 4 1.5 8 2.0 2 2.0 4 2.1 1 2.1 8 2.0 4 1.8 5 1.9 4 2.1 6 2.2 6 1.4 9 1.8 7 2.0 6 2.1 3 1.8 5 1.9 8 1.3

4.1 1 3.2 8 3.2 9 3.4 5 3.9 9 3.4 9 3.0 5 4.0 1 4.1 4 4.2 1 3.7 9 3.2 8 3.9 0 3.7 8 3.9 0 4.0 4 4.0 2 3.6 9 3.8 7 4.2 8 4.2 3 3.1 9 3.5 3 3.9 3 3.9 7 3.6 5 3.8 2 2.9

7.7 3 6.2 9 6.5 3 5.9 6 7.2 7 6.6 6 6.1 9 7.3 7 7.7 2 7.7 7 7.2 4 6.4 3 7.3 5 7.0 1 7.1 6 7.4 2 7.4 2 7.0 9 7.1 9 7.8 4 7.7 1 6.5 5 6.6 9 7.2 8 7.1 9 7.0 8 7.1 8 6.7

6.6 8 N.A 5.7 1 N.A 5.7 5 N.A 5.2 4.7 5 5 6.2 5.7 0 6 5.9 5.4 6 9 5.6 1 6.4 9 6.9 5 N. A 6.4 9 5.8 7 6.5 1 6.2 0 6.3 2 6.5 9 6.3 5 6.4 5 6.4 3 7.0 1 6.6 9 5.9 2 5.9 4 6.4 3 6.3 0 6.5 0 6.3 7 6.1 N.A 5.9 7 N.A N.A 5.9 9 5.4 8 5.9 7 N.A N.A 6.0 4 N.A 5.9 8 5.9 3 6.2 8 N.A N.A N.A 5.9 4 5.8 3 6.0 1 5.9 5 5.6

252.88 314.06 305.51 26.93 208.05 582.47 1096.2 1 412.33 2008.3 4 2008.3 4 130.91 270.77 410.81 558.63 306.69 55.12 128.88 201.13 1287.2 9 1289.1 1

47.26 284.0 8 602.7 2 655.4 3 51.72 182.9 4 595.7 5 240.1 4 906.0 7 906.0 7 17.19 62.96 157.6 6 984.6 0 937.5 2 44.81 106.9 7 117.7 7 606.0 0 511.8 8

11.4728 12.4046 11.5287 11.2215 12.1764 12.4363 12.6611 11.5366 11.6969 12.5558 11.6300 12.3959 12.3636 12.0361 11.7519 11.6283 11.3983 12.0596 13.5542 1227.818 1
69

149.9

BOB Income Fund CanIncome DBS Chola Triple Ace Regular DSP Merrill Lynch Bond Fund DWS Premier Bond Fund - Regular Plan Escorts Income Plan Grindlays SSI Fund - Investment Plan HDFC High Interest Fund HDFC Income Fund HSBC Income Fund - Investment Plan ICICI Prudential Income Plan ING Vysya Income Fund JM Income Fund Kotak Bond Deposit Kotak Bond Regular LICMF Bond Fund Principal Income Fund Reliance Income Fund Sahara Income Fund SBI Magnum Income Fund Sundaram Bond Saver Sundaram Income Plus Tata Income Fund Tata Income Plus Fund - Option A Templeton India IBA - Plan A Templeton India Income Fund UTI Bond Advantage Fund UTI Bond Fund Avg CRISIL Fund~dX Gilt Funds - Long Term Birla Gilt Plus - Regular Plan Birla Sun Life Govt Securities LTP BOB Gilt Fund CanGilt (PGS) DBS Chola Gilt Investment DSP Merrill Lynch Govt Sec (Plan A) Grindlays G Sec Fund - Investment Plan HDFC Gilt Fund - Long Term Plan

0.47 1.43 25.12 68.57 4.20 17.40 115.69 60.54

0.45 1.24 14.50 56.36 1.65 5.55 56.40 39.54

12.7088 13.3809 24.2552 25.0666

0.47 0.87 1.26 0.16 11.9718 0.32 0.45 0.23 22.7334 0.10 0.29 0.48 16.8994 0.22 0.39 0.70 24.3776 0.14 0.35 0.49 16.6020 12.3571 21.5414 18.2310 28.8271 18.6378 19.6272 20.0754 10.5548 23.2407 13.1609 19.7410 22.8693 12.9187 25.1218 12.7403 24.7949 25.7328 21.7090 1907.5571 2471.6240 0.17 0.10 0.16 0.11 0.10 0.06 0.09 0.07 0.12 0.28 0.13 0.11 0.11 0.09 0.10 0.07 0.49 0.32 0.49 0.24 0.20 0.22 0.29 0.52 0.27 0.52 0.28 0.24 0.33 0.28 0.25 0.14 0.59 0.49 0.87 0.51 0.42 0.43 0.58 0.73 0.49 0.63 0.65

0.06 0.12 0.04 0.05

0.13 0.25 0.10 0.16

271.68 215.54 32.82 25.94 270.43 225.99 15.90 10.36 38.20 26.00 36.31 46.59 36.31 46.59 143.57 96.53 46.29 386.94 153.58 60.07 2.68 1.41 109.99 76.97 10.39 49.65 N.A 72.45 63.60 6.56 41.79 3.08

132.39 97.83 193.39 190.56 419.68 293.52 24.97 22.24

0.27 0.55 0.60 0.63 0.68 0.15 0.05 0.06 0.13 0.27 0.50 0.02 0.20 0.53 0.15 0.31 1.13 0.12 0.30 0.57 0.11 0.33 0.18 0.23 0.03 0.08 0.12 0.33 0.41 0.17 0.24 0.55 0.46 0.63 0.84

1.14 1.81 1.41 0.96 1.56 0.59 0.78 0.22 0.34 0.00 0.22 0.66 0.96 0.42 0.85 0.98 1.06 0.25 1.83 0.01 0.94 1.62 1.25 1.74 0.51 0.46 0.67 1.81 0.74 0.35 0.79 0.69 1.67 1.81 0.05 0.01 0.65 0.07

2 3 1 2

0 1 1

0 1 1 2 1 1 2 1 2 1 5

1 1 2 2 3

0 1

1 2 1

126.97 56.42 2.75 2.20 7.56 0.54 151.06 172.27 3.00 36.19 6.81 45.43
70

23.4162 19.9163 11.4157 18.5464

2 2 3 2

2.48 30.10 2.66 33.67

18.6654 0.09 0.32 0.54 23.0199 0.06 0.71 0.26 13.8017 0.21 0.36 0.73 15.5952 0.22 0.54 0.15

0 2

ICICI Prudential Gilt Investment ING Vysya Gilt Fund JM Govt Securities Regular Plan Kotak Gilt - Investment Regular LICMF G-Sec Fund Principal Gilt Fund - Investment Plan Reliance Gilt Securities Fund LTP SBI Magnum Gilt Fund - Long Term Sundaram Gilt Fund Tata Gilt Securities Fund Templeton India G-Sec - Composite Plan Templeton India G-Sec Fund LTP UTI Gilt Advantage Fund LTP UTI G-Sec Fund Growth Avg Crisil MF~Gilt Index

187.64 103.95 0.06 0.04 5.81 4.61 96.86 88.01 14.96 98.06 409.20 1.65 278.76 244.56 59.01 79.79 187.54 29.00 50.49 17.43 47.29 221.81 1.71 210.93 136.63 56.20 58.86 128.05

22.5067 0.17 0.50 0.75 1.22 3 12.2953 0.07 0.14 0.64 1.41 2 21.3313 0.24 0.30 1.01 1.32 2 23.5358 0.07 0.36 0.18 0.13 0 18.9941 0.11 0.30 0.68 0.93 1 16.0551 0.09 0.88 0.59 0.74 0 12.7779 0.34 0.61 0.66 0.55 2 17.3114 0.31 0.44 0.72 1.42 2 13.5463 0.14 0.24 0.72 1.52 2 23.2988 0.14 0.10 0.86 1.50 2 24.2229 0.08 0.50 0.34 0.14 1 16.5398 0.24 0.56 0.33 0.11 2 15.2641 0.20 0.34 0.42 0.52 1 19.1333 0.14 0.38 0.46 0.69 1 0.15 0.40 0.57 0.73 1 1994.2210 0.15 0.35 0.59 0.81 1

Gilt Funds - Short Term Birla Gilt Plus - Liquid Plan Birla Sun Life Govt Securities STP DSP Merrill Lynch Govt Sec Fund (Plan B) Grindlays G Sec Fund - Short Term Plan HDFC Gilt Fund - Short Term Plan HSBC Gilt Fund - Short Term Plan ICICI Prudential Gilt Treasury Kotak Gilt Savings Principal Gilt Fund - Savings Plan Reliance Gilt Securities Fund STP SBI Magnum Gilt Fund - Short Term Templeton India G-Sec Fund - Treasury Plan UTI G-Sec Fund - Short Term Plan Avg Monthly Income Funds (<= 20% Equity) ABN AMRO Monthly Income Plan Birla MIP II - Savings 5 Plan Birla MIP II - Wealth 25 Plan Birla Monthly Income Plan C Birla Sun Life Monthly Income DBS Chola MIP - Regular DSP ML Savings Plus - Aggressive DSP ML Savings Plus - Conservative DSP ML Savings Plus - Moderate DWS MIP Fund - Plan A DWS MIP Fund - Plan B

59.45 0.81 13.61 1.99 20.25 0.49 93.11 25.95 22.43 3.39 55.25 108.93 58.03

26.22 0.63 4.99 1.58 10.59 1.03 65.96 13.33 1.71 7.61 9.43 158.22 77.52

18.2448 16.0299 16.9423 12.6619 13.7224 11.2352 18.0292 18.2066 14.1082 11.5454 14.9486 13.9810 11.7697

0.11 0.06 0.12 0.09 0.04 0.09 0.18 0.11 0.08 0.11 0.17 0.07 0.13 0.10 0.83 0.19 0.72 0.72 0.67 0.16 0.87 0.34 0.61 1.21 0.81

0.25 0.40 0.37 0.19 0.18 0.16 0.38 0.31 0.17 0.23 0.33 0.14 0.29 0.26 1.53 0.39 1.30 1.27 1.17 0.73 1.15 0.48 0.83 1.00 0.73

0.40 0.50 0.50 0.60 0.51 0.63 0.83 0.38 0.57 0.49 0.69 0.30 0.56 0.54 1.20 0.92 2.07 2.19 1.58 0.85 1.43 0.73 1.15 1.05 1.27

1.35 1.29 1.01 1.43 1.13 1.55 1.14 1.22 0.89 1.39 2.11 1.06 1.56 1.32 -0.51 1.13 -0.64 0.27 0.23 -0.06 1.26 0.84 0.63 -1.14 -0.73

3.33 4.78 2.21 2.80 2.41 3.05 2.05 2.33 2.13 2.81 3.62 2.68 3.07 2.87 7.32 2.84 2.36 2.82 3.44 2.47 5.65 3.56 4.01 -0.09 -0.31

71.41 9.16 80.94 227.17 145.37 9.20 45.76 12.84 189.85 6.90 3.05

66.99 5.92 116.60 148.55 144.35 5.30 65.23 10.58 158.63 5.56 0.79

13.0879 11.6806 13.4391 19.2169 25.3983 13.3201 13.9928 12.1574 15.2949 12.4953 11.9066

71

FT India Monthly Income Plan HDFC Monthly Income Plan - STP HSBC MIP - Regular HSBC MIP - Savings ICICI Prudential MIP Plan ING Vysya MIP Fund - Plan B JM MIP Fund Kotak Income Plus LICMF Monthly Income Plan Principal MIP - Accumulation Plan Principal MIP - MIP Plus Reliance Monthly Income Plan SBI Magnum Monthly Income Plan Sundaram Monthly Income Plan Tata MIP Plus Fund Tata Monthly Income Fund Templeton Monthly Income Plan UTI Monthly Income Scheme Avg Monthly Income Funds (>= 20% Equity) HDFC Monthly Income Plan - LTP ICICI Prudential Income Multiplier Fund UTI MIS Advantage Plan Avg Balanced Funds Birla Balance Fund Birla Sun Life 95 Fund BOB Balance Fund CAN Balanced II CanBalance DSP Merrill Lynch Balanced Fund FT India Balanced Fund HDFC Balanced Fund HDFC Prudence Fund ICICI Prudential Balance Fund ING Vysya Balanced Fund JM Balanced Fund Kotak Balance LICMF Balanced Fund - Plan C Principal Balanced Fund Reliance Regular Savings - Balanced SBI Magnum Balanced Fund Sundaram Balanced Fund Tata Balanced Fund Tata Young Citizens Fund Templeton India Pension Plan UTI Balanced Fund

660.17 404.63 63.02 87.78 446.78 7.05 19.29 105.51 111.82 72.20 32.87 345.82 127.94 48.03 71.32 56.05 140.17 250.93

577.67 221.19 47.44 64.24 611.08 5.43 14.80 71.49 226.17 53.19 19.33 507.94 111.47 44.15 50.54 34.01 121.24 172.76

20.6314 13.0161 12.4062 13.3116 19.0386 12.1966 13.3435 13.0729 24.1969 15.1733 12.7610 13.5679 16.6921 12.7254 12.0038 14.7242 19.8983 13.8889

0.73 1.53 0.78 1.05 0.64 0.79 1.32 0.82 0.77 0.91 1.04 0.70 0.56 0.77 0.76 0.34 0.60 0.50 0.75

1.38 1.96 1.31 1.80 1.24 1.01 2.53 1.37 1.50 1.63 1.87 1.48 1.20 1.35 1.41 0.72 1.11 1.22 1.26

1.62 2.42 1.71 2.36 1.40 0.70 2.41 1.42 1.71 1.89 2.27 1.47 1.55 1.56 2.20 1.05 1.48 1.86 1.57 1.79 1.66 1.82 1.75 5.88 6.23 3.65 4.30 3.90 4.66 3.95 7.39 6.01 5.21 5.12 6.80 5.42 3.98 6.42 4.29 5.35 7.28 7.51 4.88 2.31 5.40

-0.45 0.65 0.67 0.40 0.07 -0.19 -0.07 -0.79 -0.28 0.15 -0.11 -2.73 -0.16 -0.73 -0.07 2.68 0.03 0.35 0.02 0.32 0.08 -1.62 -0.41 -1.62 -0.40

2.07 2.52 3.22 3.98 3.13 3.35 3.01 2.07 2.91 2.34 2.79 0.98 1.41 1.68 2.78 3.89 2.10 2.44 2.78 4.23 4.71 3.10 4.01 6.94 9.09

823.21 256.50 94.25

1132.49 466.63 103.15

14.8909 0.42 1.47 14.5103 0.80 1.36 13.9692 0.71 1.45 0.64 1.43 27.9000 2.24 3.41 178.9900 2.59 4.66 22.2900 0.13 3.15 36.5200 1.11 4.52 27.5100 1.78 3.97 38.3870 2.32 4.16 32.8773 2.09 3.97 30.6960 3.42 6.58 113.7340 1.83 4.92 34.5500 2.77 4.60 18.4800 2.16 3.94 23.2400 4.08 7.15 23.3820 2.23 4.12 42.8757 1.83 4.29 21.5400 2.23 5.18 11.4926 2.70 4.92 35.0800 3.15 5.06 32.6419 4.13 6.46 50.7420 2.86 5.81 22.4667 1.79 3.31 43.3969 1.28 2.39 54.0600 2.21 4.48

137.58 124.86

115.11 128.23

1.01 0.85 75.50 85.10 68.47 56.75 332.74 394.79 221.76 258.08 114.19 108.32 1645.68 2150.46 371.13 452.69 11.77 7.78 10.75 13.83 96.23 94.83 29.51 33.07 38.22 28.14 1.82 20.34 190.89 271.16 40.22 45.51 148.73 151.63 147.39 152.09 113.91 139.31 562.55 1044.84

-2.54 0.41 -4.57 -0.57 -4.15 3.30 -2.73 7.26 -1.95 7.30 -5.48 -0.62 -2.83 8.64 -3.84 7.60 -0.38 6.76 -2.84 9.57 -3.48 3.59 -7.26 1.07 -3.93 1.84 -1.22 1.88 -2.91 6.85 -1.74 6.70 -0.72 12.29 -1.05 8.15 -2.01 4.49 -4.50 0.45

72

Avg Crisil bx Index Funds - Nifty Plan Birla Index Fund Franklin India Index Fund - NSE Nifty Plan HDFC Index Fund - Nifty Plan ICICI Prudential Index Fund - Nifty Plan ING Vysya Nifty Plus Fund LICMF Index Fund - Nifty Plan Nifty Benchmark Exchange Traded - JUNIOR BeES Nifty Benchmark Exchange Traded - Nifty BeES Principal Index Fund Reliance Index Fund - Nifty Plan SBI Magnum Index Fund UTI Index Select Equity Fund UTI Nifty Index Fund Avg Index Funds - Sensex Plan Franklin India Index Fund - BSE Sensex Plan HDFC Index Fund - Sensex Plan HDFC Index Fund - Sensex Plus Plan LICMF Index Fund - Sensex Advantage Plan LICMF Index Fund - Sensex Plan Reliance Index Fund - Sensex Plan SENSEX ICICI Prudential Exchange Traded (SPIcE) UTI Master Index Fund Avg BSE Sensex S&P CNX Nifty Pure Large Cap Equity Funds ABN AMRO Equity Fund Birla Advantage Fund Birla Sun Life Frontline Equity Fund Birla Top 100 Fund DBS Cholamandalam Growth Fund DSP Merrill Lynch Equity Fund DSP Merrill Lynch Top 100 Equity Fund DWS Alpha Equity Fund Fidelity Equity Fund Franklin India Bluechip Fund Franklin India Prima Plus HDFC Core and Satellite Fund HDFC Equity Fund HDFC Growth Fund HDFC Top 200 Fund HSBC Equity Fund

2.30 4.59 7505.2643 2.22 4.75 4.73 38.17 4.76 4.65 2.54 3.44 161.70 6.16 5.24 1.20 13.74 43.62 44.37 115.52 54.55 13.29 19.94 3.76 142.60 159.80 3.39 11.09 1.98 9.27 219.02 54.02 39.5169 31.8265 38.9576 35.5345 20.6300 24.4766 402.7777 74.4534 28.5435 15.8013 36.3787 33.6900 25.5857 4.37 4.34 4.50 4.38 4.09 3.78 4.35 5.23 4.25 3.65 4.28 3.25 4.37 4.22 3.86 3.87 4.00 3.52 3.11 3.70 7.02 6.98 7.01 7.04 6.62 5.47

5.27 5.16 5.28 8.57 8.15 8.59 8.01 6.86

-2.82 -3.04 -5.20 -2.18 -1.74 -1.96 -2.04 -3.80

5.14 6.84 3.69 8.98 8.32 8.48 8.92 5.54

7.02 8.74 9.85 11.88 6.80 8.39 5.33 6.46 6.72 8.33 5.74 6.82 7.02 8.68 6.82 8.06 8.01 7.99 8.59 8.43 6.88 7.75 9.67 9.13 9.77 8.06 8.00 8.99

-1.87 9.54 -0.48 11.30 -2.32 7.06 -4.16 4.34 -2.41 7.36 -5.02 3.66 -1.94 9.18 -2.70 7.41 -1.87 -2.45 -0.53 -3.78 -3.58 -1.12 9.07 7.61 9.97 6.03 5.65 8.78

4.80 5.40 6.57 7.76 7.35 1.57 0.90 34.69

20.46 29.37 14.18 20.84 31.15 3.99 0.72 45.94

38.6362 127.7267 149.0932 28.1372 28.8311 20.4906

142.6496 3.77 7.93 9.33 43.6189 3.84 8.06 9.39 3.71 7.95 9.04 13897.4100 3.84 8.10 9.38 4083.5500 4.24 8.84 10.44 26.3300 123.5900 51.1900 15.6078 30.7100 39.0140 57.7430 50.3900 21.4090 127.5122 137.7705 24.7880 147.6740 47.7710 108.8490 70.0327 4.07 2.88 2.96 3.18 3.86 3.32 3.60 3.43 3.06 3.30 2.11 2.82 2.98 3.34 3.96 2.92 7.95 5.88 6.29 5.90 6.23 5.89 6.03 6.62 6.08 6.15 5.53 5.46 5.48 6.75 6.51 5.81 8.09 7.11 8.18 7.48 8.48 6.93 7.62 8.34 7.49 7.35 6.90 7.75 6.79 9.93 8.55 7.15

-1.78 9.39 -1.93 9.25 -2.13 8.22 -1.99 9.35 -0.16 11.06 -6.06 -3.96 -1.61 -4.13 -7.02 -4.45 -1.30 -2.95 -1.10 -5.08 -3.83 -5.72 -2.59 -3.57 -3.99 -4.65 9.25 7.81 12.41 5.36 4.85 12.17 12.38 5.29 14.43 5.75 12.11 0.92 8.25 8.49 6.47 9.05

231.03 552.48 57.54 604.92 30.68 551.69 157.41 46.11 3152.41 2280.66 691.19 641.12 2907.34 339.34 1143.78 1260.56

143.44 470.59 147.76 465.92 34.90 706.62 327.48 102.73 2659.47 2316.34 948.62 637.43 3892.90 394.48 1702.77 936.95

73

ICICI Prudential Discovery Fund ICICI Prudential Growth Plan ICICI Prudential Power ING Vysya Equity Fund ING Vysya L.I.O.N Fund Kotak 30 Principal Growth Fund Principal Large Cap Fund Reliance Equity Fund Reliance Regular Savings - Equity Reliance Vision Fund SBI Blue Chip Fund SBI Magnum Equity Fund Standard Chartered Imperial Equity Fund Sundaram Growth Fund Sundaram India Leadership Fund Sundaram Select Focus Tata Pure Equity Fund Templeton India Equity Income Fund UTI Equity Fund (Old Name - UTI Mastergain Fund) UTI Growth Value Fund UTI Leadership Equity Fund UTI Master Growth Unit Scheme UTI Master Plus Unit Scheme UTI Thematic - Large Cap Fund Avg BSE Sensex CNX MIDCAP S&P CNX Nifty Pure Mid Cap Equity Funds ABN AMRO Future Leaders Fund Baroda Global Fund Birla Midcap Fund DBS Chola Midcap Fund Franklin India Prima Fund HSBC Midcap Equity Fund ICICI Prudential Emerging S T A R ING Vysya Midcap Fund Kotak Midcap Principal Junior Cap Fund Reliance Growth Fund Sahara Midcap Fund

1103.21 335.03 1094.21 8.01 213.38 336.35 374.67 292.67 5820.10 30.20 1832.32 3013.67 N.A 449.49 134.53 274.06 81.53 285.03 N.A

873.13 430.64 1357.81 5.52 73.35 420.82 268.85 264.42 4359.60 186.39 2473.68 1892.08 282.78 210.56 154.11 268.23 331.59 304.85 1727.85

25.9700 93.0600 81.3000 31.7900 12.2200 67.3970 48.2000 17.0300 11.4100 14.9401 177.4900 11.2600 27.5900 11.8450 64.7911

5.91 4.33 3.77 3.05 3.38 3.86 2.44 3.46 2.98 3.08 2.91 3.30 2.83 3.35 3.60

8.43 6.67 7.30 5.97 6.54 6.55 5.98 6.84 5.75 6.54 6.80 5.83 5.59 6.67 6.20

8.39 8.52 8.04 7.51 6.72 7.40 7.02 8.54 6.04 5.11 7.23 8.17 7.40 7.56 5.91

27.9863 3.52 6.07 58.9301 3.70 5.75 61.1553 3.17 6.09 11.6540 0.94 2.50 31.7600 56.6900 12.1200 42.9900 63.8200 18.3100 13619.7000 5112.7500 3997.6500 2.78 2.48 3.59 3.27 3.65 2.87 3.08 3.86 3.38 4.38 5.20 5.61 6.13 5.89 5.75 0.05 5.98 6.51 7.59 7.08

-7.65 -2.61 -2.68 -3.58 -4.31 -4.13 -7.22 -2.96 -4.20 -7.88 -5.20 -6.09 -3.23 -3.10 -8.98 4.89 10.13 6.27 -5.81 7.56 -3.56 0.79 7.12 7.08 7.73 6.83 7.17 -1.51 7.02 7.71 9.61 8.66

-1.78 8.25 9.16 3.99 2.69 7.07 3.12 8.68 5.65 3.37 7.98 0.99 N.A 5.70 4.78 2.73 8.28 9.18

-2.96 10.15 -4.94 -3.92 -4.94 -6.32 -6.48 -9.71 -4.75 -3.97 -3.23 -2.26 2.65 8.33 9.09 4.29 7.04 -1.72 6.62 7.04 8.58 8.70

1747.57 1440.17 194.74 148.70 1820.73 1003.00 360.95 350.31 946.61 866.88 28.24 25.99

N.A 57.93 167.95 62.44

265.06 8.59 239.39 36.00

9.9350 10.7600 63.5800 25.5400 194.3006 18.9305 27.7900 16.9300 20.0740 14.4800 270.9500 17.8513

3.55 3.07 3.62 3.32 2.57 3.04 2.28 3.87 2.95 2.55 3.42 3.02

8.1 6.8 7.9 7.4

2481.87 1500.12 502.40 293.14 606.49 1058.42 65.93 34.09 356.24 230.63 150.18 70.39 2639.68 3263.71 15.72 10.29

6.6 6.9 6.7 6.9 6.6 5.6 6.8 6.1

74

SBI Magnum Global Fund SBI Magnum Midcap Fund Sundaram Select Midcap Tata Growth Fund UTI Thematic - Mid Cap Fund Avg BSE Sensex CNX MIDCAP S&P CNX Nifty Blend/Dynamic/Opportunistic/Flexi Cap Equity Funds ABN AMRO Opportunities Fund Birla Sun Life Equity Fund DBS Chola Multi-Cap Fund DSP Merrill Lynch Opportunities Fund DWS Investment Opportunity Fund Franklin India Flexi Cap Fund HDFC Premier MultiCap Fund HSBC Advantage India Fund HSBC India Opportunities Fund ICICI Prudential Dynamic Plan JM Equity Fund Kotak Opportunities Principal Focussed Advantage Fund Reliance Equity Opportunities Fund SBI Magnum MultiCap Fund SBI Magnum Multiplier Plus 93 Standard Chartered Classic Equity Fund Standard Chartered Premier Equity Fund Sundaram S M I L E Fund Tata Equity Opportunities Fund UTI Dynamic Equity Fund UTI Opportunities Fund Avg CNX MIDCAP Value Style Equity Funds ABN AMRO Dividend Yield Fund Birla Dividend Yield Plus DBS Chola Contra Fund HDFC Capital Builder Fund ING Vysya A.T.M Fund ING Vysya Dividend Yield Fund Kotak Contra Principal Dividend Yield Fund

534.39 355.24 562.90 46.04 79.76

1361.77 409.89 2033.95 69.52 74.36

42.3400 21.8500 89.1073 32.2206

2.27 2.39 2.26 3.47

4.9 7.1 5.2 6.0

20.7400 3.24 2.99 13619.7000 3.86 5112.7500 3.38 3997.6500 4.38 20.8900 180.5100 17.8000 53.9670 22.7600 20.3637 18.2740 12.1488 27.9504 65.3025 34.7500 28.8320 15.9900 21.0776 15.0000 53.1200 15.5236 14.1474 4.14 1.98 2.53 2.75 2.02 3.34 3.43 2.11 4.39 3.38

7.4 6.6 6.5 7.5 7.0

227.33 384.58 72.16 1053.23 7.59 2885.34 1225.69 1741.27 457.64 903.89

151.56 604.60 51.90 1306.24 8.93 3424.94 670.71 1157.77 649.08 2015.41

9.8 5.8 5.3 5.8 5.5 6.4 6.4 6.0 6.9 6.3

39.61 64.64 231.28 221.96 114.01 59.03 2338.80 2385.65 1903.98 1096.52 676.43 719.61 788.50 369.84 310.07 166.29 280.08 446.20 178.07 645.84 178.73 432.16 123.06 493.66

3.55 8.9 3.54 6.0 2.30 5.4 3.04 6.3 2.74 5.4 3.35 7.3 3.46 6.7 3.94 10.3

17.4545 2.28 57.6273 2.68 33.4500 3.75 13.8100 4.15 3.13 5652.0800 2.53

5.4 6.7

7.8 7.4 6.7 7.0

147.55 728.19 126.43 1006.49 125.95 181.73 366.24 191.56

20.07 401.40 64.92 640.37 24.91 41.40 137.11 134.49

10.3230 42.2900 11.2400 63.8050 10.8400 11.5900 14.6390 15.1900

4.89 4.52 3.12 3.64 3.44 3.39 3.00 3.47

8.0 8.1 5.9 7.3 5.1 6.4 6.4 6.9

75

SBI Magnum Sector Umbrella Contra Tata Contra Fund Tata Dividend Yield Fund Tata Equity PE Fund Templeton India Growth Fund UTI Contra Fund Avg Theme Based Equity Funds Birla India GenNext Fund Birla India Opportunities Fund - Plan B Birla Infrastructure Fund Birla MNC Fund Birla Sun Life Basic Industries Fund Birla Sun Life Buy India Fund DBS Chola Opportunities Fund DSP Merrill Lynch India T.I.G.E.R. Fidelity India Special Situations Fund Franklin India Opportunities Fund ICICI Prudential Infrastructure Fund ICICI Prudential Services Industries ING Vysya Domestic Opportunities JM Emerging Leaders Fund JM HI FI Fund Kotak Global India Kotak Life Style Fund Kotak MNC Fund Principal Infrastructure & Services Ind. Principal Resurgent India Equity Fund Sahara Infrastructure - Fixed Pricing Sahara Infrastructure - Variable Pricing SBI Magnum - COMMA Fund SBI Magnum - Emerging Business Sundaram CAPEX Opportunities Sundaram Rural India Fund Tata Infrastructure Fund Tata Life Sciences & Technology Tata Select Equity Fund Tata Service Industries Fund UTI GSF- Services Sector UTI India Advantage Equity UTI Infrastructure Fund Avg BSE Sensex CNX MIDCAP

1095.25 1499.09 502.53 189.27 249.84 143.11 108.86 84.48 391.74 292.21 N.A 631.76

37.5600 11.1348 17.4358 25.8021 65.4988

3.02 3.90 4.55 4.30 3.99

6.9 7.5 7.5 9.5 7.0

9.2900 2.65 3.71 15.9300 51.4100 11.9300 120.0000 67.5700 27.2000 27.5700 32.8970 12.5910 25.1431 18.5600 15.7400 26.9600 2.58 2.33 3.29 2.48 3.78 2.95 4.95 2.26 3.89 2.04 3.75 3.48 3.49

4.3 6.9

370.30 161.37 105.19 83.44 609.85 449.62 240.20 187.43 143.20 143.31 233.96 106.46 5.90 10.88 801.06 1435.73 N.A 2074.75 385.03 797.48 1439.00 1583.42 532.12 465.98 58.35 79.13 40.89 N.A 156.09 876.84 71.69 498.08 273.19 N.A N.A 721.50 461.15 281.75 N.A 883.84 35.08 90.19 241.57 230.86 67.45 284.65 63.24 33.44 109.90 372.42 40.61 257.96 189.42 15.05 15.05 404.29 256.37 211.37 809.92 1213.10 35.93 110.36 184.76 444.10 54.27 812.19

5.0 3.8 8.2 5.4 8.5 4.9 8.8 6.6 7.3 7.3 7.7 7.7 6.3

10.2900 3.83 9.6700 26.8490 11.8880 26.7720 11.4200 75.0200 11.0754 11.1502 15.3400 29.1600 16.5006 11.0273 23.1237 48.8285 47.5937 20.0472 47.9300 8.3600 27.4600

9.9

3.76 10.2 3.86 6.5 1.61 4.2 3.51 7.8 2.70 6.7 3.26 6.9 2.54 5.5 2.55 5.5 4.57 8.6 2.39 7.4 3.04 7.3 3.61 6.7 3.04 7.4 3.92 5.4 4.28 8.4 3.39 7.1 3.19 5.7 3.85 7.1 3.90 8.2 3.27 7.0 13619.7000 3.86 6.5 5112.7500 3.38 7.5

76

S&P CNX Nifty IT Sector Funds Birla Sun Life New Millennium Fund DSP Merrill Lynch Technology Fund Franklin InfoTech Fund ICICI Prudential Technology Fund Kotak Tech Fund SBI Magnum Sector Umbrella InfoTech UTI Growth Sectors Fund-Software Fund FMCG Sector Funds Franklin FMCG Fund ICICI Prudential FMCG Fund SBI Magnum Sector Umbrella FMCG UTI Growth Sectors Fund-Brand Value UTI MNC Fund Pharmacy Sector Funds Franklin Pharma Fund JM Healthcare Sector Fund Reliance Pharma Fund SBI Magnum Sector Umbrella Pharma UTI GSF-Pharma & Healthcare Other Sector Funds^ JM Auto Sector Fund JM Basic Fund Reliance Banking Fund Reliance Diversified Power Sector Fund Reliance Media and Entertainment Fund UTI Growth Sectors Fund-Petro Fund UTI Thematic - Auto Sector Fund UTI Thematic - Banking Sector Fund UTI Thematic - PSU Fund BSE BANKEX BSE FMCG BSE Healthcare BSE IT BSE PSU BSE Teck

3997.6500 4.38 104.76 30.14 164.04 132.73 51.00 66.57 129.58 119.88 70.22 183.30 166.38 44.71 111.87 126.91 20.9000 26.3210 52.8585 15.7400 10.4690 28.2700 27.6500 3.52 3.95 2.03 3.01 3.25 1.98 2.33

7.0

6.3 6.2 3.4 6.7 4.6 4.8 4.5

46.59 121.62 14.10 82.20 255.31 98.74 11.51 146.19 82.08 99.10

29.68 85.40 9.12 58.20 148.93 60.93 7.71 114.95 49.46 73.28

33.4602 1.00 39.8100 1.48 13.6000 1.49 24.7100 2.41 33.5700 2.25 29.7502 17.7300 21.1845 34.5900 22.2800 2.96 3.62 5.15 3.07 2.72

3.9 3.1

5.0

0.2 4.0

3.2 5.6 7.7 5.0 4.2

11.45 11.76 159.41 702.14 38.00 219.74 45.86 87.40 23.74

9.94 9.17 108.26 827.73 78.41 165.24 69.76 64.70 18.09

20.3200 19.8200 37.2500 36.0962 25.6666 26.1900

3.04 2.01 5.11 1.29 1.86 4.97

4.9 7.4 8.1 6.5 6.0 6.4

16.9200 2.55 20.2600 4.43 15.3600 2.00 6848.8500 5.85 1810.8300 3773.4200 4974.8300 6242.5500 3643.0100 1.26 3.12 1.95 3.64 3.33

4.8 7.6

2.0

9.5

5.7 3.5 3.3 5.9 5.4

77

CHAPTER-7

BIBLIOGRAPHY
78

Websites:

1) 2) 3) 4)

www.amfiindia.com www.moneycontrol.com www.valueresearchonline.com www.bseindia.com

Magazines: 1) Economic Times 2) Investors India Magazine

Books Refered: Donald E.Fischer Ronald J.Jordan 2004 Sixth edition security analysis and portfolio management Prentice Hall of India Private Limited. Gautam Bhardwaj Invest India Economic Foundation 2006

79