Thesis Final s

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DIVYA KOTHIWAL

INDIAN INSTITUTE OF

PLANNING AND

MANAGEMENT

NEW DELHI

THESIS REPORT ON

STUDY OF INVESTMENT PATTERNS OF SMALL AND MEDIUMENTERPRISES (SMEs)

SUBMITTED TO:

PROF.SUMANTA SHARMA

PROF. VIJAY KR.BODDU

EXTERNAL GUIDE:

MR.ANIRUDH SHARMA

SUBMITTED BY:

DIVYA KOTHIWAL

PGP-FW-2008-2010

ALUMNI ID NO.: DF/08/10-F-579

ABSTRACT

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Starting with the acknowledgement, I have presented with the background of the

Mutual Fund Industry. There is information on mutual fund comprising of things

like as to what mutual fund is: its history, types of mutual funds etc. Next there is

information of study etc., actual analysis but firstly starting with giving someinformation on the type of questionnaire design used, sampling technique,

research design etc.,

The primary objective of the report is to study the investment patterns of Small

and Medium Enterprises and to further establish if the type of trade they are in

affects the investment decisions in Mutual Funds.

We did a market research by making the company fill a structured questionnaire

and find out their exposure to Mutual Funds.

SIGNATORY PAGE

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This is to certify that the thesis titled Study of investment patterns of Small

and Medium Enterprises(SMEs) prepared by Ms. Divya Kothiwal for the

award of degree in Master of Business Administration has been completed under

my supervision & guidance. It is an original piece of work based on primary as

well as secondary data.

This work is satisfactory and complete in every respect. I wish her all the success

for her future endeavour.

Thanking you

Yours Sincerely

ANIRUDH SHARMA

THESIS APPROVAL LETTER

Dear Divya Kothiwal,

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This is to inform that your thesis proposal on Study of Investment Patterns of

Small & Medium Enterprises, to be conducted under the guidance of Mr.

Anirudh Sharma is hereby approved and the topic registration id number

is DF/08/10-F-579

Make it a comprehensive thesis by ensuring that all the objectives as stated by

you in your synopsis are met using appropriate research design; a thesis should

aim at adding value to the existing knowledge base.

You are required to correspond with your internal guide Prof. Vijay Kr. Boddu

at [email protected] Ph.-0124-3350714 by sending at least four response

sheets (attached along with this mail) at regular intervals before the last date of

thesis submission.

Regards,

Prof .Sumanta Sharma

Dean (Projects)

IIPM

[email protected]

Phone:

+91 0124 3350701 (D)+91 0124 3350715 (Board)

SYNOPSIS

Name: Divya Kothiwal

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NB:

1) A thesis would be rejected if there is any variation in the topic/title from the

one approved and registered with us.

2) The candidate needs to handwrite at least 1200 to 1500 words on the

summary of thesis at the time of viva.
mailto:[email protected]:[email protected]:[email protected]:[email protected]


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DIVYA KOTHIWAL

Section: F.7

Batch: Fall/Winter 2008-2010

Phone Number: 9818593910

E-mail Id: [email protected]

Thesis Topic: Study of Investment Patterns of Small & Medium

Enterprises

Specialization Area: Finance

Introduction:

I will be focusing primarily on the small and medium enterprises in New Delhi, NCR

analyzing their investment patterns. My External Guide, Mr. Anirudh Sharma

(Manager, ICICI Bank) will be helping me in the research and the study. The basic

aim of the research in the initial stages will be to analyze the trend of the mutual fund

industry. Later, followed by the primary research and by forecasting with and without

the two external forces or factors and finally coming up with a solution in the final

stage.

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Research Objectives:

1. To study and understand the investment patterns of SMEs.

2. To further establish that if the type of trade affects the investmentdecisions in Mutual funds.

Hypothesis: Mappingthe concerned areato do a market research study with the

help of the questionnaires and find out their exposure to the Mutual Funds.

Research Methodology:

Secondary Data: This form of methodology will be used for finding the trend

followed by the enterprises and forecasting the possible outcome in the coming

years. The sources for the same will consist of internet, relevant study papers,

newspaper articles, books and so on. Hence, an analysis of pre-existing data in a

different way to answer the questions or else to answer a separate question than

the originally intended one will help with the use of secondary data.

Primary Data: This form of data will be used to in the form of questionnaires

which will be filled by the top management and officials of various enterprises

and set- ups involved in this business. Mostly, the questions will be open ended

but will make sure that the information that will be extracted from the same

should be very effective in coming to conclusions.

Scope of the Work: The scope for this study is to gather information from the

various sources, understand it and derive the factors that are responsible or

affect the investment patterns of SMEs in relation to the mutual fund industry. A

primary research will help show (in which I would be visiting officials of various

companies in this business) the forecasting in which I would be using all the tools

possible to forecast what could go wrong and what can possibly be the effects

and after effects?

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Justification for choosing the topic: Mutual funds industry has been moving

up and a growing sector recently. It is very important to understand how the

various enterprises work towards handling the mutual funds in their respective

companies? Depending, on the market conditions and the various ups and

downs, the fund value changes. I would study all that affects these changes.

Details of External Guide:

Name: Mr.Anirudh Sharma

Qualification: MBA

Designation: Manager

Company: ICICI Bank Ltd

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ACKNOWLEDGEMENT

I sincerely feel that the guidance and support extended towards me by all themembers of ICICI was more than I could expect. I express my immense gratitudetowards all the members of this organization.

They really made my learning experience the most memorable and respectableone. It was a great honour to be associated with a company.

I take the opportunity to express my sincere gratitude to my project guide Mr.Anirudh Sharma, without whose guidance and support I could not havecompleted my project.

I am also thankful to all the other managers and employees for taking out timefrom their busy schedule and guiding me in order to make this project a success.

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TABLE OF CONTENTS

1. Acknowledgement

2. Background

3. Mutual Funds

3.1Returns

3.2Advantages

3.3Disadvantages

3.4Risks

3.5Mutual fund types

3.6Procedure of opening a folio

4. Mutual fund companies in India

5. The study

5.1Purpose

5.2Scope

5.3Data collection and job requirement

5.4Limitations

5.5About Small and Medium enterprises

5.6Current investment patterns

5.7Instruments in Indian debt market

6. The analysis

6.1Sources of data

6.2Sampling

6.3Scope of study

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6.4Research design

6.5Questionnaire design

6.6Procedure of data collection

7. Results and interpretation

7.1Findings

8. Conclusion

9. Annexures

10. References

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BACKGROUND

My work involved two tasks:

I. Lead generation through series of appointments with the prospective

company.

II. Marketing Research and data collection which involved mapping the

allotted area, getting the required information by asking the company to fill

the questionnaire. Here is a little background on marketing research:

Marketing research is defined as the systematic and objective identification,collection, analysis, and dissemination of information for the purpose of assisting

management in decision making related to the identification and solution of

problems (and opportunities) in marketing.

1) Identification: Involves defining the marketing research problem (or

opportunity) and determining the information that is needed to

address it.

2) Collection: Data must be obtained from relevant sources.

3) Analysis: Data are analyzed, interpreted, and inferences are drawn.

4) Dissemination of information: The findings, implications, andrecommendations are provided in a format that makes this informationactionable and directly useful as an input into decision making.

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Mutual Funds

A Mutual Fund is a trust that pools the savings of a number of investors who

share a common financial goal. It is essentially a diversified portfolio of financialinstruments - these could be equities, debentures / bonds or money marketinstruments. The corpus of the fund is then deployed in investment alternativesthat help to meet predefined investment objectives. The income earned throughthese investments and the capital appreciation realised are shared by its unitholders in proportion to the number of units owned by them. Thus a Mutual Fundis a suitable investment for the common man as it offers an opportunity to investin a diversified, professionally managed basket of securities at a relatively lowcost.

One could make money from a mutual fund in three ways:

1) Income is earned from dividends declared by mutual fund schemes from timeto time.

2) If the fund sells securities that have increased in price, the fund has a capitalgain. This is reflected in the price of each unit. When investors sell these units atprices higher than their purchase price, they stand to make a gain.

3) If fund holdings increase in price but are not sold by the fund manager, thefund's unit price increases. You can then sell your mutual fund units for a profit.This is tantamount to a valuation gain.

Every mutual fund has a goal - either growing its assets (capital gains) and/orgenerating income (dividends) for its investors. Distributions in the form ofcapital gains (short-term and long-term) and dividends may be passed on (paid)to shareholders as income or reinvested to purchase more shares.

Like any business, mutual funds have risks and costs associated with returns.As a shareholder, the risks of a fund and the expenses associated with fund'soperation directly impact your return. You can look at the flowchart to understandin brief as to how mutual funds work.

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A. Returns on Mutual Funds

As an investor, you want to know the fund's return-its track record over aspecified period of time. So what exactly is "return?" A mutual fund's return is therate of increase or decrease in its value over a specific period of time usuallyexpressed in the following increments: one, three, five, and ten year, year to

date, and since the inception of the fund. Since return is a common measure ofperformance, you can use it to evaluate and compare mutual funds within thesame fund category. Generally expressed as an annualized percentage rate,return is calculated assuming that all distributions from the fund are reinvested.

Since average returns can sometimes "hide" short-term highs and lows, youshould evaluate returns for a time period of several years-not just one year orless. A fund that has a high return in one year may have experienced losses inother years-these fluctuations may not be apparent in its average return. While afund's return shows its track record, keep in mind that past performance is noguarantee of future results.

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purchase decision. Investors should always read the prospectus carefully beforeinvesting in any mutual fund.

Liquidity

Mutual fund shares are liquid and orders to buy or sell are placed during markethours. However, orders are not executed until the close of business when theNAV (Net Average Value) of the fund can be determined. Fees or commissionsmay or may not be applicable. Fees and commissions are determined by thespecific fund and the institution that executes the order.

C. Disadvantages

Risks and Costs

Changing market conditions can create fluctuations in the value of amutual fund investment.

There are fees and expenses associated with investing in mutual fundsthat do not usually occur when purchasing individual securities directly.

As with any type of investment, there are drawbacks associated withmutual funds.

No Guarantees

The value of your mutual fund investment, unlike a bank deposit, could fall andbe worth less than the principle initially invested. And, while a money market fundseeks a stable share price, its yield fluctuates, unlike a certificate of deposit. Inaddition, mutual funds are not insured or guaranteed by an agency of the U.S.government. Bond funds, unlike purchasing a bond directly, will not re-pay theprinciple at a set point in time.

The Diversification Penalty

Diversification can help to reduce your risk of loss from holding a single security,but it limits your potential for a "home run" if a single security increasesdramatically in value. Remember, too, that diversification does not protect youfrom an overall decline in the market.

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Costs

In some cases, the efficiencies of fund ownership are offset by a combination ofsales commissions, redemption fees, and operating expenses. If the fund ispurchased in a taxable account, taxes may have to be paid on capital gains.Keep track of the cost basis of your initial purchase and new shares that areacquired by reinvesting distributions. It's important to compare the costs of fundsyou are considering.

D. Risk

Every type of investment, including mutual funds, involves risk. Risk refers to thepossibility that you will lose money (both principal and any earnings) or fail tomake money on an investment. A fund's investment objective and its holdingsare influential factors in determining how risky a fund is. Reading the prospectuswill help you to understand the risk associated with that particular fund.

Generally speaking, risk and potential return are related. This is the risk/returntrade-off. Higher risks are usually taken with the expectation of higher returns atthe cost of increased volatility. While a fund with higher risk has the potential forhigher return, it also has the greater potential for losses or negative returns. Theschool of thought when investing in mutual funds suggests that the longer yourinvestment time horizon is the less affected you should be by short-termvolatility. Therefore, the shorter your investment time horizon, the moreconcerned you should be with short-term volatility and higher risk.

Defining Mutual fund risk

Different mutual fund categories as previously defined have inherently differentrisk characteristics and should not be compared side by side. A bond fund withbelow-average risk, for example, should not be compared to a stock fund withbelow average risk. Even though both funds have low risk for their respectivecategories, stock funds overall have a higher risk/return potential than bondfunds.

Of all the asset classes, cash investments (i.e. money markets) offer the greatestprice stability but have yielded the lowest long-term returns. Bonds typicallyexperience more short-term price swings, and in turn have generated higherlong-term returns. However, stocks historically have been subject to the greatestshort-term price fluctuationsand have provided the highest long-term returns.Investors looking for a fund which incorporates all asset classes may consider abalanced or hybrid mutual fund. These funds can be very conservative or veryaggressive. Asset allocation portfolios are mutual funds that invest in othermutual funds with different asset classes. At the discretion of the manager(s),

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securities are bought, sold, and shifted between funds with different assetclasses according to market conditions.

Mutual funds face risks based on the investments they hold. For example, a bond

fund faces interest rate risk and income risk. Bond values are inversely relatedto interest rates. If interest rates go up, bond values will go down and viceversa. Bond income is also affected by the change in interest rates. Bond yieldsare directly related to interest rates falling as interest rates fall and rising asinterest rise. Income risk is greater for a short-term bond fund than for a long-term bond fund.

Similarly, a sector stock fund (which invests in a single industry, such astelecommunications) is at risk that its price will decline due to developments in itsindustry. A stock fund that invests across many industries is more sheltered fromthis risk defined as industry risk.

Following is a glossary of some risks to consider when investing in mutual funds.

Call Risk: The possibility that falling interest rates will cause a bond issuerto redeemor callits high-yielding bond before the bond's maturity date.

Country Risk: The possibility that political events (a war, nationalelections), financial problems (rising inflation, government default), ornatural disasters (an earthquake, a poor harvest) will weaken a country'seconomy and cause investments in that country to decline.

Credit Risk: The possibility that a bond issuer will fail to repay interest

and principal in a timely manner. Also called default risk.

Currency Risk: The possibility that returns could be reduced forAmericans investing in foreign securities because of a rise in the value ofthe U.S. dollar against foreign currencies. Also called exchange-rate risk.

Income Risk: The possibility that a fixed-income fund's dividends willdecline as a result of falling overall interest rates.

Industry Risk: The possibility that a group of stocks in a single industrywill decline in price due to developments in that industry.

Inflation Risk: The possibility that increases in the cost of living willreduce or eliminate a fund's real inflation-adjusted returns.

Interest Rate Risk: The possibility that a bond fund will decline in valuebecause of an increase in interest rates.

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Manager Risk: The possibility that an actively managed mutual fund'sinvestment adviser will fail to execute the fund's investment strategyeffectively resulting in the failure of stated objectives.

Market Risk: The possibility that stock fund or bond fund prices overallwill decline over short or even extended periods. Stock and bond marketstend to move in cycles, with periods when prices rise and other periodswhen prices fall.

Principal Risk: The possibility that an investment will go down in value, or "lose

money," from the original or invested amount.

E. Mutual Fund Types

Wide varieties of Mutual Fund Schemes exist to cater to the needs such asfinancial position, risk tolerance and return expectations etc. The table belowgives an overview into the existing types of schemes in the Industry.

TYPES OF MUTUAL FUND SCHEMES

By Structureo Open - Ended Schemes

o Close - Ended Schemes

o Interval Schemes

By Investment Objective

o Growth Schemes

o Income Schemes

o Balanced Schemes

o Money Market Schemes

Other Schemes

o Tax Saving Schemes

o Special Schemes

Index Schemes

Sector Specific Schemes

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Mutual Funds by Structure

Open-Ended Schemes: An open-ended fund or scheme is one that is available

for subscription and repurchase on a continuous basis. These schemes do not

have a fixed maturity period. Investors can conveniently buy and sell units at Net

Asset Value (NAV) related prices which are declared on a daily basis. The key

feature of open-end schemes is liquidity.

Close-Ended Schemes: A close-ended fund or scheme has a stipulated

maturity period e.g. 5-7 years. The fund is open for subscription only during aspecified period at the time of launch of the scheme. 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 scheme on the stock exchanges where the units are listed. In

order to provide an exit 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 i.e. either repurchase facility or through listing

on stock exchanges. These mutual funds schemes disclose NAV generally on

weekly basis.

Mutual Funds by Investment Objective

Growth / Equity Scheme: The aim of growth funds is to provide capital

appreciation over the medium to long-term. Such schemes normally invest a

major part of their corpus in equities. Such funds have comparatively high risks.

Growth schemes are good for investors having a long-term outlook seeking

appreciation over a period of time.

Income / Debt Oriented Scheme: 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, Government securities and

money market instruments. Such funds are less risky compared to equity

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schemes. These funds are not affected because of fluctuations in equity markets.

However, opportunities of capital appreciation are also limited in such funds.

Balanced Funds: The aim of balanced funds is to provide both growth and

regular income as such schemes invest both in equities and fixed income

securities in the proportion indicated in their offer documents. These are

appropriate for investors looking for moderate growth. They generally invest 40-

60% in equity and debt instruments. These funds are also affected because of

fluctuations in share prices in the stock markets. However, NAVs of such funds

are likely to be less volatile compared to pure equity funds.

Money Market / Liquid Schemes: These funds are also income funds and their

aim is to provide easy liquidity, preservation of capital and moderate income.

These schemes invest exclusively in safer short-term instruments such as

treasury bills, certificates of deposit, commercial paper and inter-bank call

money, government securities, etc. Returns on these schemes fluctuate much

less compared to other funds. These funds are appropriate for corporate and

individual investors as a means to park their surplus funds for short periods.

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Risk Hierarchy of Different Mutual Funds


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Others:

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Gilt Funds: These funds invest exclusively in government securities.

Government securities have no default risk. NAVs of these schemes also

fluctuate due to change in interest rates and other economic factors as is

the case with income or debt oriented schemes.

Index Funds: Index Funds replicate the portfolio of a particular index such

as the BSE Sensitive index, S&P NSE 50 index (Nifty), etc. These

schemes invest in the securities in the same weightage comprising of an

index. NAVs of such schemes would rise or fall in accordance with the rise

or fall in the index, though not exactly by the same percentage.

Sector-Specific Schemes: These are the funds/schemes which invest in

the securities of only those sectors or industries as specified in the offer

documents E.g. Pharmaceuticals, Software, Fast Moving Consumer

Goods (FMCG), Petroleum stocks etc. The returns in these funds are

dependent on the performance of the respective sectors/industries. While

these funds may give higher returns, they are more risky compared to

diversified funds.

Tax Saving Schemes: These schemes offer tax rebates to the investors

under specific provisions of the Income Tax Act, 1961 as the Government

offers tax incentives for investment in specified avenues. E.g. Equity

Linked Savings Schemes (ELSS). Pension Schemes launched by the

mutual funds also offer tax benefits. These schemes are growth oriented

and invest pre-dominantly in equities. Their growth opportunities and risks

associated are like any equity-oriented scheme.

Load or No Load Funds: Load Fund is one that charges a percentage of

NAV for entry or exit. That is, each time one buys or sells units in the fund,

a charge will be payable. This charge is used by the mutual fund for

marketing and distribution expenses. The investors should take the loads

into consideration while making investment as these affect their

yields/returns. However, the investors should also consider the

performance track record and service standards of the mutual fund which

are more important.

A no-load fund is one that does not charge for entry or exit. It means the

investors can enter the fund/scheme at NAV and no additional charges

are payable on purchase or sale of units.

Here is a sales sheet of various types of mutual funds as on April 2008:

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Sales during the month of April, 2008

Amount in Rs. Crores

Nature StructureOpen End Close End Total

No. of Schemes

Amount No. ofSchemes

Amount No. ofSchemes

Amount

Balanced 31 370 6 - 37 370ELSS 30 271 11 179 41 450FOFInvestingOverseas

6 143 - - 6 143

Gilt 30 157 - - 30 157GOLD ETF 5 33 - - 5 33

Growth 222 4071 49 29 271 4100Income 152 118553 265 4222 417 122775Liquid/Money Market

57 386820 - - 57 386820

Other ETF 8 352 - - 8 352Total 541 510770 331 4430 872 515200

F. Procedure of Opening up a Folio

Fresh Purchase: After deciding on the type of scheme, the investor will have to

fill in the Application form, attach a payment instrument and submit it at any of

the funds' collection centers before the cut off time. The investor has to invest in

rupees and units will be allotted to him in fractions depending upon the NAV.

Additional Purchase: Buying more units either of the same scheme or of

a different scheme under the SAME FOLIO is an additional purchase,which can be done through Additional Purchase slips provided along with

the account statement. After filling the same, the investor will have to

attach a cheque with it and submit it at any of the collection centers before

the cut-off time.

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Switch Units: A switch request will have to be filled in and submitted at

any of the collection centers before the cut off time. SWITCH can be done

with either partial or all units under a particular scheme to another scheme

as specified by him under the same folio.

Redeem / Repurchase Units: If the fund is open ended, the investor hasto send the repurchase requisition slip, duly completed and signed, to anyof our branches. It is possible to lodge repurchase requests on the Internetalso. The redemption can be done for all units, partial units, or for anamount.

Mutual Fund Companies in India

ABN AMRO Mutual Fund

ABN AMRO Mutual Fund was setup on April 15, 2004 with ABN AMRO Trustee(India) Pvt. Ltd. as the Trustee Company. The AMC, ABN AMRO AssetManagement (India) Ltd. was incorporated on November 4, 2003. DeutscheBank A G is the custodian of ABN AMRO Mutual Fund.

Birla Sun Life Mutual Fund

Birla Sun Life Mutual Fund is the joint venture of Aditya Birla Group and Sun Life

Financial. Sun Life Financial is a golbal organisation evolved in 1871 and is beingrepresented in Canada, the US, the Philippines, Japan, Indonesia and Bermudaapart from India. Birla Sun Life Mutual Fund follows a conservative long-termapproach to investment. Recently it crossed AUM of Rs. 10,000 crores.

Bank of Baroda Mutual Fund (BOB Mutual Fund)

Bank of Baroda Mutual Fund or BOB Mutual Fund was setup on October 30,1992 under the sponsorship of Bank of Baroda. BOB Asset Management

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Company Limited is the AMC of BOB Mutual Fund and was incorporated onNovember 5, 1992. Deutsche Bank AG is the custodian.

HDFC Mutual Fund

HDFC Mutual Fund was setup on June 30, 2000 with two sponsorers nemelyHousing Development Finance Corporation Limited and Standard LifeInvestments Limited.

HSBC Mutual Fund

HSBC Mutual Fund was setup on May 27, 2002 with HSBC Securities andCapital Markets (India) Private Limited as the sponsor. Board of Trustees, HSBCMutual Fund acts as the Trustee Company of HSBC Mutual Fund.

ING Vysya Mutual Fund

ING Vysya Mutual Fund was setup on February 11, 1999 with the same namedTrustee Company. It is a joint venture of Vysya and ING. The AMC, INGInvestment Management (India) Pvt. Ltd. was incorporated on April 6, 1998.

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Prudential ICICI Mutual Fund

The mutual fund of ICICI is a joint venture with Prudential Plc. of America, one ofthe largest life insurance companies in the US of A. Prudential ICICI Mutual Fund

was setup on 13th of October, 1993 with two sponsorers, Prudential Plc. andICICI Ltd. The Trustee Company formed is Prudential ICICI Trust Ltd. and the

AMC is Prudential ICICI Asset Management Company Limited incorporated on22nd of June, 1993.

Sahara Mutual Fund

Sahara Mutual Fund was set up on July 18, 1996 with Sahara India FinancialCorporation Ltd. as the sponsor. Sahara Asset Management Company PrivateLimited incorporated on August 31, 1995 works as the AMC of Sahara MutualFund. The paid-up capital of the AMC stands at Rs 25.8 crore.

State Bank of India Mutual Fund

State Bank of India Mutual Fund is the first Bank sponsored Mutual Fund tolaunch offshor fund, the India Magnum Fund with a corpus of Rs. 225 cr.approximately. Today it is the largest Bank sponsored Mutual Fund in India. Theyhave already launched 35 Schemes out of which 15 have already yieldedhandsome returns to investors. State Bank of India Mutual Fund has more thanRs. 5,500 Crores as AUM. Now it has an investor base of over 8 Lakhs spreadover 18 schemes.

Tata Mutual Fund

Tata Mutual Fund (TMF) is a Trust under the Indian Trust Act, 1882. Thesponsorers for Tata Mutual Fund are Tata Sons Ltd., and Tata InvestmentCorporation Ltd. The investment manager is Tata Asset Management Limitedand its Tata Trustee Company Pvt. Limited. Tata Asset Management Limited's isone of the fastest in the country with more than Rs. 7,703 crores (as on April 30,2005) of AUM.

Kotak Mahindra Mutual Fund

Kotak Mahindra Asset Management Company (KMAMC) is a subsidiary of

KMBL. It is presently having more than 1,99,818 investors in its variousschemes. KMAMC started its operations in December 1998. Kotak MahindraMutual Fund offers schemes catering to investors with varying risk - returnprofiles. It was the first company to launch dedicated gilt scheme investing only ingovernment securities

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Unit Trust of India Mutual Fund

UTI Asset Management Company Private Limited, established in Jan 14, 2003,manages the UTI Mutual Fund with the support of UTI Trustee Company Private

Limited. UTI Asset Management Company presently manages a corpus of overRs.20000 Crore. The sponsorers of UTI Mutual Fund are Bank of Baroda (BOB),Punjab National Bank (PNB), State Bank of India (SBI), and Life InsuranceCorporation of India (LIC). The schemes of UTI Mutual Fund are Liquid Funds,Income Funds, Asset Management Funds, Index Funds, Equity Funds andBalance Funds.

Reliance Mutual Fund

Reliance Mutual Fund (RMF) was established as trust under Indian Trusts Act,1882. The sponsor of RMF is Reliance Capital Limited and Reliance Capital

Trustee Co. Limited is the Trustee. It was registered on June 30, 1995 asReliance Capital Mutual Fund which was changed on March 11, 2004. RelianceMutual Fund was formed for launching of various schemes under which units areissued to the Public with a view to contribute to the capital market and to provideinvestors the opportunities to make investments in diversified securities.

Standard Chartered Mutual Fund

Standard Chartered Mutual Fund was set up on March 13, 2000 sponsored byStandard Chartered Bank. The Trustee is Standard Chartered Trustee CompanyPvt. Ltd. Standard Chartered Asset Management Company Pvt. Ltd. is the AMCwhich was incorporated with SEBI on December 20,1999.

Franklin Templeton India Mutual Fund

The group, Frnaklin Templeton Investments is a California (USA) basedcompany with a global AUM of US$ 409.2 bn. (as of April 30, 2005). It is one ofthe largest financial services groups in the world. Investors can buy or sell theMutual Fund through their financial advisor or through mail or through theirwebsite. They have Open end Diversified Equity schemes, Open end SectorEquity schemes, Open end Hybrid schemes, Open end Tax Saving schemes,Open end Income and Liquid schemes, Closed end Income schemes and Openend Fund of Funds schemes to offer.

Morgan Stanley Mutual Fund India

Morgan Stanley is a worldwide financial services company and its leading in themarket in securities, investment management and credit services. MorganStanley Investment Management (MISM) was established in the year 1975. Itprovides customized asset management services and products to governments,corporations, pension funds and non-profit organisations. Its services are also

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extended to high net worth individuals and retail investors. In India it is known asMorgan Stanley Investment Management Private Limited (MSIM India) and its

AMC is Morgan Stanley Mutual Fund (MSMF). This is the first close enddiversified equity scheme serving the needs of Indian retail investors focussing

on a long-term capital appreciation.

Escorts Mutual Fund

Escorts Mutual Fund was setup on April 15, 1996 with Escorts Finance Limitedas its sponsor. The Trustee Company is Escorts Investment Trust Limited. Its

AMC was incorporated on December 1, 1995 with the name Escorts AssetManagement Limited.

Alliance Capital Mutual Fund

Alliance Capital Mutual Fund was setup on December 30, 1994 with AllianceCapital Management Corp. of Delaware (USA) as sponsorer. The Trustee isACAM Trust Company Pvt. Ltd. and AMC, the Alliance Capital AssetManagement India (Pvt) Ltd. with the corporate office in Mumbai.

Benchmark Mutual Fund

Benchmark Mutual Fund was setup on June 12, 2001 with Niche FinancialServices Pvt. Ltd. as the sponsorer and Benchmark Trustee Company Pvt. Ltd.as the Trustee Company. Incorporated on October 16, 2000 and headquarteredin Mumbai, Benchmark Asset Management Company Pvt. Ltd. is the AMC.

Canbank Mutual Fund

Canbank Mutual Fund was setup on December 19, 1987 with Canara Bankacting as the sponsor. Canbank Investment Management Services Ltd.incorporated on March 2, 1993 is the AMC. The Corporate Office of the AMC isin Mumbai.

Chola Mutual Fund

Chola Mutual Fund under the sponsorship of Cholamandalam Investment &Finance Company Ltd. was setup on January 3, 1997. Cholamandalam Trustee

Co. Ltd. is the Trustee Company and AMC is Cholamandalam AMC Limited.

LIC Mutual Fund

Life Insurance Corporation of India set up LIC Mutual Fund on 19th June 1989. Itcontributed Rs. 2 Crores towards the corpus of the Fund. LIC Mutual Fund wasconstituted as a Trust in accordance with the provisions of the Indian Trust Act,1882. . The Company started its business on 29th April 1994. The Trustees of

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LIC Mutual Fund have appointed Jeevan Bima Sahayog Asset ManagementCompany Ltd as the Investment Managers for LIC Mutual Fund.

GIC Mutual Fund

GIC Mutual Fund, sponsored by General Insurance Corporation of India (GIC), aGovernment of India undertaking and the four Public Sector General InsuranceCompanies, viz. National Insurance Co. Ltd (NIC), The New India Assurance Co.Ltd. (NIA), The Oriental Insurance Co. Ltd (OIC) and United India Insurance Co.Ltd. (UII) and is constituted as a Trust in accordance with the provisions of theIndian Trusts Act, 1882.

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The Study

Purpose of the study

The purpose of the study is to evaluate how much SMEs have an exposure to

mutual funds and what are their investment patterns.

Scope of the Study

The scope of study is limited to studying the investment patterns and exposure to

mutual funds of SMEs in Nehru Place.

Data Collection and Job Requirement

The methods that I have employed in collecting data are:

a. Online Directories like Just dial, Fundoodata etc.

b. Existing database given by Reliance ( small proportion)

c. Mapping the areas given to us which involves fieldwork and in turn

involves gathering information like company name, financial heads

name, companys contact number, companys line of work etc.

d. Telephonic calls to fix an appointment with the concerned person.

e. Relationship management

Limitations of the Study

a. Not getting enough appointments as the financial heads may refuse

to talk to us.

b. Sometimes you cant reach the right person who is actually the

decision maker in the organization.

c. Cold calling sometimes doesnt yield the desired results

d. Database sometimes given on the net is not updated which leads to

wastage of time and effort.

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e. Corporates not revealing true information sometimes

f. Small sample size

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About Small and Medium Enterprises (SMEs)

With the advent of planned economy from 1951 and the subsequent policyfollowed by government of India, both planners and government earmarked a

special role for small-scale industries and medium scale industries in the Indian

economy. Due protection was accorded to both sectors, and particularly for small

scale industries from 1951 to 1991, till the nation adopted a policy of liberalization

and globalization. Certain products were reserved for small-scale units for a long

time, though this list of products is decreasing due to change in industrial policies

and climate. It can be observed that by and large, SMEs in India met the

expectations of the government and developed in a manner, which made it

possible for them to achieve the following objectives:

High contribution to domestic production

Significant export earnings

Low investment requirements

Operational flexibility

Location wise mobility Low intensive imports

Capacities to develop appropriate indigenous technology

Import substitution

Technology oriented industries

Competitiveness in domestic and export markets

At the same time one has to understand the limitations of SMEs, which are:

Low capital base

Inadequate exposure to international environment

Inability to face impact of WTO regime

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Inadequate contribution towards R&D

Lack of professionalism

In spite of these limitations, the SMEs have made significant contribution towards

technological development and exports. SMEs have been established in almost

all major sectors in the Indian industry such as:

Food processing

Agricultural inputs

Chemicals & pharmaceuticals

Electronics

Textiles and Garments

Leather and leather goods

Meat products

Bio-engineering

Sports goods

Plastics products

Computer software, etc.

The following points more clearly brings out why banks and mutual fund

companies should

focus on SMEs:

Government and RBI pushing for SME funding in urban and semi urban

areas.

Large corporate are accessing funds directly from the capital markets.

SMEs have become big producers and exporters of consumer goods.

SMEs are now conscious of quality, production efficiencies and costs.

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SMEs have a repayment record comparable to the best borrowers.

Sector growing at over 10% per annum.

Large corporate are increasingly outsourcing work to SMEs.

As clearly stated above, SMEs sector has become a major source of income for

the banks and

mutual fund companies and is therefore selling like hot cake. Bust just making

the funds and FMP s available is not a solution-neither for the SMEs nor for the

banks. These products have to be made known to the investors for whom they

are meant. The project undertaken deals with the marketing of these new and

existing funds and FMP s to the SMEs. The project therefore started with the

study of the history of mutual fund industry in India and various stages which

contributed to its evolution in India and the various factors and developments

added at each stage.

When the thought and research process was started for the first one it was found

out that the SMEs has several investment options in their pockets from the very

starting like:

Fixed interest government bonds.

Bank fixed deposits.

Share market.

Commercial papers.

Although as we can see that there were various options available in the hands of

the people but if we give a good analyzing look at most of these options today

and have a comparative evaluation for various investments with reference to the

rate of return and the unavoidable evil inflation rate we can see very clearly that

in most of these investments the rate of return is very much closer to the inflation

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rate which minimizes the net increase in the income and increase of the wealth of

the people keeping it somewhere around 1-3%. So what is required by all the

AMC s and other broking houses is that apart from the normal business they are

doing they should also organize or sponsor several such seminars in which

various prospective clients could be called and all their doubts can be cleared off

according to their convenience and they should be encouraged to be a part of

this booming Indian economy.

Current Investment Pattern of SMEs

The investment pattern of people whose investment perspective have taken anew turn, has changed a lot and they are looking towards new horizons of

investments.

Currently the chief options available for investment are:

Government bonds and debentures

Commercial papers and deposits

Fixed deposits

PPF

Retirement and Pension schemes

Equity based MF & ELSS plan

Direct trading into stock market

Multi commodity exchange

Real estate

Now we can make out that today people are not just looking towards a simple

and safer saving but they are making attempts to get an investment which can

lead for a healthy return along with the security of money and moreover they are

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diversifying their investment and following the simple policy of don t keep all your

eggs in one basket. So a wise diversification no doubt reduces the net risk and

makes the total portfolio a better returning one and obviously a lesser risky.

Hence we can conclude by saying that the present day investor is much wiser

and has more number of baskets to keep his eggs in.

Factors affecting the investors while making the portfolio:

Time frame of investment

Return on investment

Risk-benefit ratio

Diversification of risk

Tax benefits

Risk coverage

Value added features

Flexibility and liabilities of investments

Inflation rate

If we analyze closely we can see that the MF more or less satisfy all the

parameters of the present day investor, may be this is the reason behind the fast

and healthy growth of the MF industry.

Instruments in the Indian Debt Market:

Certificate of Deposit: Issued by the scheduled commercial banks

excluding the regional rural banks. These are unsecured negotiable

promissory notes.

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Commercial Paper: A CP is a short term, unsecured instrument

issued by corporate bodies (public and private) to meet short term

working capital requirements. The maturity varies between 3

months to 1 year.

Corporate debentures: These are issued by companies with

physical assets, as secured instruments in the form of certificates.

They are assigned a credit rating by the rating agencies.

Floating rate bonds: Short to medium term interest bearing

instruments issued by financial corporations. A typical maturity

ranges from 3 years to 5 years. Such bonds if issued by Financial

Institutions are generally unsecured, while those issued by Private

corporations are secured.

Government Securities: These are medium to long term interest

bearing obligations issued by the Government of India and the

States through the RBI. These are issues where the rates are pre-

specified and the investor (a corporate or an individual) only bids

for quantity. The RBI here acts only as a Depository.

Treasury Bills: These are short term obligations issued through

the RBI also by the government of India at a Discount. RBI issues

T- Bills for different tenures ranging from 91 days to 364 days, also

issued through an auction procedure. The yield is determined on

the basis of bids tendered and accepted.

Bank and Financial institution Bond: Most of these are in the

form of promissory notes transferable by endorsement and delivery.These are issued mainly by Financial Institutions such as

ICICI/IDBI/IFCI or by commercial Banks

Public Sector Undertaking (PSU) Bonds: These are medium and

long term obligations issued by public sector companies where the

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government shareholding is grater than 51%. Some PSU bonds

Carry tax exemptions. The minimum maturity is 5 years for taxable

bonds and 7 years for tax free bonds. Such bonds are generally not

guaranteed by the government and are transferable in the Formby

endorsement and delivery

The Analysis

Sources of Data

Data are of two types namely primary and secondary:

Primary Data refers to information that is developed or gathered by the

researcher specifically for the research project at hand.

Secondary Data refers to information that has previously been gathered by

someone other than the researcher and/or for some other purpose than the

research project at hand.

When deciding if the data to be collected is secondary in nature, ask the following

question: Would the data have been collected as a part of the normal course

requirements? If the answer is no, then the data should be classified as primary.

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INTERNAL DATA

Internal data are data available within the organization for which the research is

being conducted. The information may be in a ready to use format or may require

processing. In our organization data was found on the company server.

EXTERNAL DATA

External data are data that originate external to the organization. This data was

found on company websites, it included published material, online databases and

some syndicated services.

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QUALITATIVE RESEARCH

An unstructured, exploratory research methodology based on small samples that

provides insights and understanding of the problem setting.

QUANTITATIVE RESEARCH

A research methodology that seeks to quantify the data and, typically, applies

some form of statistical analysis

Our research involved quantity, we had a large number of representative cases

which had structured data collection and we also recommended a final course of

action.

In my study, primary data is the data that I collected by mapping the companies

in Nehru place and appointments that I had with financial heads who gave

valuable information. Secondary data would include the already existing

database given initially by Reliance Mutual fund house and also data collected on

the internet through websites like Fundoodata, Just Dial etc.

Sampling

Sampling Design

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The sample chosen from the target population for retailers was based on the size

of the particular area of Delhi as well as the number of retailers present in that

particular area. This was also done on the basis of convenience sampling.

The customers were sampled on the basis of convenience sampling.

Sample Size

The sample size for the project was taken as 200. The market research was

based on convenient sampling.

Scope of Study

The research is categorically classified into three sub-researches on the basis of

the products provided by the company. The scope of this study essentiallyincludes the regions, areas, and the product categories in which the surveys

have been conducted. The scope of the study can be broadly categorized into

three scopes, namely:

Geographical scope

Product scope

Time scope or extent of study

Geographical scope

The geographical scope covers areas from where the samples have been taken.

Majorly the sample has been taken from Nehru place and the adjoining areas

and a couple of samples have been taken from Okhla Industrial Estate

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Product scope

The product scope features the product category in which the research has been

carried out. The product category of this study is mutual funds and specifically

highly liquid debt schemes catering to corporate clients.

Procedure for Data Collection

Data collection means gathering information to address those critical evaluation

questions that may be in the minds of the company/ researcher. And the

procedure for data collection to be adopted depends on the requirements of the

research.

For the purpose of data collection, I first identified the area that I would work inand in that I identified the companies which were capable of making an

investment who had decent turnover so that they could have the capacity to

invest atleast 1 crore which is the minimum amount for institutional investment.

This was done with the help of internet, database provided by the company as

well as cold callings.

Before going further to decide the method of data collection, we identified some

of the important issues in this regard. These were:

1. Availability: We realized that there may be some information alreadyavailable that can help answer some questions or guide the development of new

guidelines. Hence we reviewed information in prior records, reports, and

summaries.

2. Pilot Testing: It was essential to test the information collection instrument or

the process we designed.

3. Protocol Needs: In many situations, we needed to obtain appropriate

permission or clearance to collect information from people or other sources.

4. Reactivity: Reactivity refers to how the way of asking a question would alterthe response we would get. It may also be a concern if our presence during data

collection may possibly alter the results..

5. Reliability: Will the evaluation process designed consistently measure what

we want it to measure? That is whether multiple interviews, settings, or

observers, will consistently measure the same thing each time? In whatever

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instrument we design, will people interpret our questions the same way each

time?

6. Validity: Validity means will the information collection methods designed

produce information that measures what we require to measure? We should be

sure that the information we collect is relevant to the purpose in hand.

Having kept these issues in mind, we adopted the following methods for data

collection:

1. Personal Interview

An interview is called personal when the Interviewer asks the questions face-to-

face with the Interviewee. Personal interviews were conducted in companies

where I went for the appointment. These were mainly of the form of structuredinterviews.

2. Questionnaire

A questionnaire is a structured technique for data collection that consists of a

series of questions that a respondent answers. The questionnaire comprised of

multiple choice, numeric open-ended as well as text-open ended questions,

depending on the nature of the query.

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Results and Interpretation

In this section we present all the facts and figures along with analysis collectedduring the market research activities performed during the course of thesis work.

The analysis is based on the questionnaire, a copy of which is there in this

report. The software used to analyse the data is Microsoft Excel and Stats

software.

The primary purpose of the study was to understand the current investment

patterns of SMEs and their exposure to mutual funds. Companies at Nehru place

which is considered to be the IT hub of Delhi were consciously chosen for the

purpose of study as they house maximum number of companies in the cityacross various segments. The numbers of companies covered have already

been mentioned (200).

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The Findings

Diversified Portfolio

Figure 11 tells us that about how companies invest their money at present in the

market.

We see that about 55% of the companies had diversified portfolio and 45%didnt. A diversified portfolio would mean investing in more than one instruments.

Now which type of instruments are we talking about here remains to be seen

which will come up in later questions. From the information given by ICICI we are

here assuming that most companies are investing in either bank FDs or share

market. Next question will prove whether it is true or not.

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Investment Tools Company Invests In

Instruments Company invests in as you can see, majority i.e. about 61% of

investments were either done in equity or bank FDs where in Bank FDs share is

32% which actually proves our hypothesis earlier on based on past information.

Now if companies are majorly investing in FDs and Equity then Savings and

Returns should be the two biggest factors in compelling the company to invest. Itmay be because of this only that Reliance Mutual Fund Houses Fixed Maturity

Plan which is on the similar line as bank FD is selling like hot cake. This figure

also shows another important result, only 14% of the companies invest in

mutual funds which justifies our hypothesis showing lack of penetration of

mutual funds in SMEs.

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Reason for investment

As you can see from the above figure 45% of companies invests for savings

purpose and 30% returns which confirms. This could be because of companies

investing in bank FDs and equity.

Rank Instruments

If you look at the ranking you can make out that majorly companies are opting foreither bank FDs (95) or RBI bonds (66) which are safe as 1st rank or 2 nd or prefer

for equities (116). This might indicate that companies are not aware about how

safe mutual funds are on the debt side. This is an early indication that companies

are not much aware about the safety and steady retruns given by mutual funds.

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Frequency of company investment

The above figure shows the frequency of company investment where you can

see majorly companies do it once in 15 days or once in a week.

Short investment or Long term investment

As you can see from the above figure that mainly companies are going for long

term investments which indicates two things. One, companies are not aware

about highly liquid debt funds that we have in mutual funds where in you can

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invest even for one day and get return on it. Second, it gives an indication that

companies are sticking to longer term Bank Fixed deposits.

Expected rate of return on Debt investments

Mainly companies are expecting return on debt investment to be above 6% which

is reasonable enough.

Expected return on Equity investments

As we can see from the above figure that undoubtedly companies are expecting

20% and above return on their equity investment which is again reasonable as

capital gain has been increased to 15% recently.

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Awareness Level if Already Investing in Mutual Funds

As you can see those who are already investing know the benefits provide by

mutual funds. Mutual funds offer liquidity steady returns and tax advantage as

well.

On whose advice do you invest

This figure shows role of relationship management to an extent as 41% of the

companies are investing through relationship managers. So this highlights the

point that relationship management is quite necessary if you want to bring in

business for the company. Its not only with the relationship managers, but it

applies to all segments. If you want your company to grow you have to have

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good relationship with the client from whom you are thinking of bringing in the

business.

Type of mutual fund you company invests in

This again confirms the hypothesis that there is lack of awareness about highly

liquid debt schems for corporates as you can see companies are heavily

investing in equity (62%) which actually brings in another interesting point in the

forefront. This figure is actually bringing in one of the limitations of the study

which is wrong information provided by the company due to either lack of

knowledge or some other reason. As earlier on we had a chart which showed

those who invested in mutual funds knew about liquidity in mutual funds, and

they also knew everything about mutual funds. But ehre the figure are giving

contradictory views.

Reason for company investing in Debt Mutual Funds

Here you can clearly see that mainly companies are investing in debt mutual

funds because it offers steady returns and liquidity (total-74%)

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Reason for investing in equity mutual funds

As you can see mainly companies are investing in equity mutual funds for greater

return over inflation which currently is a big factor in India.

Company not investing in mutual funds because:

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As you can see the reason for not investing is dipersed but majorly its either

because of lack of knowledge or low returns as compared to share market which

again strengthens our claim of companies investing in equities more than mutual

funds.

Would you consider investing in mutual funds if:

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Since mutual funds provides liquidity, steady returns, low risk,tax benefits, once

companies are made aware about this they are either ready to invest in them orcan think of investing.

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Awareness about current account surplus earning interest

As it is clear from the above figure that mostly people are not aware about

current account surplus earning interest for even one day (61%) which again

strengthens our argument that companies are not aware about liquid funds that

much.

Would you invest in mutual funds if you knew about benefits:

As you can clearly see that most of the companies (89%) are ready to invest if

given proper information about mutual funds which is a very important point. So

this gives mutual fund companies motivation to explore even more areas where

they can find prospective clients.

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Would you like to know more about mutual funds

As you can see the eagerness of companies once they are provided the right

information about mutual funds.

It states that 94% companies want to know more about mutual funds. This is a

good indication for mutual fund houses that are always in a hunt to find new

corporate.

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Conclusion

The conclusion is that currently a lot of companies are still not fully informed

about the benefits that are associated with investing in mutual funds. The ones

which are investing are investing more in equity schemes which shows that they

dont know much about the highly liquid debt schemes that mutual fund provides.

Non mutual fund investors are mainly investing their money in bank fixed

deposits of longer maturity when they can get better returns if they park money in

mutual funds. Also, though the sample size is small but it still gives an indication

that the sector in which an SME is in will affect its decision to whether or not

invest in mutual funds but a conclusive research needs to be done on this. Its

now the job of mutual fund houses to increase their efforts even more and try tocreate more and more awareness about mutual funds.

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Annexure

In the annexure I am attaching the questionnaire which used for analysis and

interpretation:

A Study On Investment Pattern of Small & Medium Enterprise (SME) Segment

(Focus on Mutual Funds)

Name: __________________________

Company: __________________________

Designation: __________________________

Contact Number: __________________________

1. Does your company have a diversified portfolio?

2. Which are the investment tools your company invests in?

Equity

3. Your company primarily invest for

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Tax Benefits

Returns

Liquidity

Savings

Others

Any other (Please Specify)

Bank Fixed Deposit

Mutual Funds

RBI Bonds

Yes No


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4. Rank the investments options according to your companys preference ofInvestment:

5. What is the frequency of your companys investment?a. Once a Weekb. Once in 15 Daysc. Once a Monthd. Once in 3 Monthse. Once in 6 Months

f. Once a Year

6. Does your company go in for:a. Short-termb. Long-term investments(Please specify the period) _____________________

7. What is the expected rate of return of your company from debtinvestments?

a. Below 4%b. 4%-5%

c. 6%-7%d. Above 7%

8. What is the expected rate of return of your company from equityinvestments?

a. 5% - 9%b. 10% - 14%c. 15% - 20%d. Above 20%

9. If your company invests in mutual finds:

a. Are you aware of the various schemes offered by Mutual Funds?b. Do you know that Mutual Funds offers Liquidity to your funds?c. Do you know that Mutual Funds offers steady returns?d. Do you know you can get Tax Advantages by investing in Mutual

Funds?

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Bank Fixed Deposit

RBI BondsMutual FundsEquities

Any other (Please Specify)

NoYes No

Yes No

YesYes

NoYes


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e. Primarily on whose external advice do you invest?

1. Bank2. Distributor

3. Agent4. Direct Investment5. RM

f. Which type of Mutual Fund does your company primarily invest in?

g. Your company invests in Debt Mutual Funds because it offers:

h. Your company invests in Equities Mutual Funds because it offers:

i. Your company invests in Balanced Mutual Funds because it offers:

10.If your company does not invest in Mutual Funds:

a. Your company does not invest in Mutual Funds because of

i) Bitter Past Experienceii) Lack of Knowledgeiii) Lack of Confidence in Service Being Providediv) Difficulty in Selection of Schemesv) Inefficient Investment Advisorsvi) Low Returns as compared to Share Market

b. Would you invest in Mutual Funds for your company if it offered (Y/N)i) Greater Tax Benefits vis--vis Others.ii) Greater Liquidity vis--vis Others.iii) Investment for a Shorter Duration, Even for One Day

iv) Steady Returnsv) Net Returns Better than a Bank Fixed Deposit with HighLiquidityvi) Diversification of Portfoliovii) Minimization of Risks

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Debt Equities Balanced

Steady Returns

Risk Mitigation Any Other

Tax BenefitsLiquidity

Returns>InflationHigher ReturnsWealth Creation Any OtherTax Advantage

Long Term Capital Gains

Higher Returns than debt

fundsTax Advantage Any otherReturns>Inflation

Yes

Yes No

Yes NoYes No

No

Yes No


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11.Are you aware that current account surpluses can also earn interest byparking in Mutual Funds even for one day?

12..If Mutual Funds offer you Steady Returns, Tax Benefits, Liquidity,Diversification of portfolio, Lesser risk etc., would you consider it as aninvestment option in the future for your company?

13.Would you be interested to know more about Mutual Funds?

PGP/FW/08-10 DF/08/10-F-579

Yes No

Yes No

Yes No


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References

www.mutualfundsindia.com

www.amfiindia.com

Richard I. Levin, David S. Rubin Seventh edition, Statistics For

Management

www.worldbank.org

Thesis Final s

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