NFO PROCESS IN MUTUAL FUNDS AT INDIA INFOLINE

Project report submitted in Partial fulfillment for the award of

MASTER OF BUSINESS ADMINISTRATION

Submitted by: RANJITH !"AR#P $earin% Roll No#&'(&)*&)+(+

PRIN,-T.N P#/# ,.00-/1Affiliated to .smania !ni2ersity3 RA"ANTHAP!R4 H56-RA$A6 1'&&*)'&&73

DECLARATION
I hereby declare that the project titled 8N9. PR.,-SS IN "!T!A0 9!N6S: done at India Info line submitted by me as part of partial fulfillment for the award of the Masters of Business Administration, at Princeton P.G College, .S"ANIA ni!ersity, "yderabad is a record of Bonafide wor# done by me.

I also declare that this report has to my #nowledge is my own and is neither submitted to any other uni!ersity nor published any time before.

1RANJITH KUMAR P3

ACKNOWLEDGEMENT
$he presentation of this project has gi!en me an opportunity to e%press myprofound gratitude to all concern in guiding me. &oremost I would li#e to than# GOPAL SIR 'Manager of Indiainfoline( for gi!ing me an opportunity to underta#e this projectwor#. I would li#e to than# the IN6IAIN9.0IN- staff for gi!ing me support and the re)uired material on time. Iwould also than# the principal of our college, P.G.*.* C+,$+* &-* .I/$,AC+ +. CA$I-,,-/MA,IA ,I0+*/I$1

"yderadad. &or pro!iding an opportunity to undergo a project study program. I would li#e to than#".H6#A$6!0 NA5--" for assisting and guiding me to complete the project wor#.

1C.VINAY VARMA3

FOREWORD
In!estments goals !ary from person to person. 2hile somebody wants security, others might gi!e more weightage to returns alone. /omebody else might want to plan for his child3s education while somebody might be sa!ing for the pro!erbial rainy day or e!en life after retirement. 2ith objecti!es defying any range , it is ob!ious that the products re)uired will !ary as well. Indian Mutual &unds industry offers a plethora of schemes and ser!es broadly all tupe of in!estors. $he range of products includes e)uity funds, debt, li)uid, gilt and balanced funds. $here are also funds meant e%clusi!ely for young and old, small and large in!estors. Moreo!er, the setup of a legal structure, which has enough teeth to safeguard in!estors intersts, ensures that the in!estors are not cheated out of their hard earned money. All in all, benefits pro!ided by them cut across the boundaries of in!estor category and thus create for them, a uni!ersal appeal. In!estors of all categories could choose to in!est on their own in multiple options but opt for Mutual &unds for the sole reason that all benefits come in a pac#age.$he Mutual &und industry is ha!ing its hands full to cater to !arious needs of the in!estors by coming up with new plans, schemes and options with respect to rate of returns, di!idend fre)uency and li)uidity. In !iew of the growing competition in the Mutual &unds industry, it was felt necessary to study the in!estors orientation towards Mutual &unds i.e. their pattern of ris# apetite and preferences in !arious schemes, plans and options in order to pro!ide a better ser!ice, $he study is an attempt in that direction.

ABSTRACT

$he purpose of this project creates a design in relation to process of ,&- ',+2 & ,. -&&+*( and how this process is carried out till the end. $he school wor# of this project is based on the procedure ta#es place in indiainfoline while going through the ,&-. $o schoolwor# the technical procedure, legal dimensions of ,&- at India info line and e%amine briefly the organi4ational structure, communication networ#, resource, re)uirements to launch a new fund. $he analysis is made by carrying the applications of reliance e)uity fund $he data for his study is colleted from !arious sources li#e maga4ines, Boo#s, 2ebsites, and from the staff of Indian Info 5ine. It generates an Idea to the in!estors in #nowing the technical procedure in carrying a ,&- by the -rgani4ation. ,ew &und -ffer process may not be same for all Mutual funds that are released. It may differ from one fund to other depending up on the si4e li#e ,- .of Applications recei!ed, /ubscriptions amount recei!ed etc. .

CONTENTS
TITLE INTRODUCTION REVIEW OF LITERATURE COMPANY PROFILE ANALYTICAL FRAME WORK PAGE NO 1 7 23 29 52 57 58 !"

QUESTIONNAIRE FINDINGS AND CONCLUSIONS SUGGESTIONS & RECOMMENDATIONS BIBLIOGRAP Y

INTRODUCTION

Introduction to the study:

Mutual &und Industry which is a relati!ely of a post6economic reforms phenomena in India, has been e%panding during this Period in branch and bound Many commercial ban#s, insurance companies entered into mutual fund industry apart from foreign players. In the early years of e!olution of mutual fund industry in the Indian financial mar#et it was a monopoly and continued to be the same till !ery recent time. $hen many players both foreign and Indian entered in the Mutual &und Industry. $his increased the competition between the !arious firms wor#ing in the mutual fund Industry $he need for de!eloping !arious new schemes arises so as to attract in!estors towards the firm and e)ually encouraging them to in!est. $his growth in the Mutual &und Industry and scope of increasing mar#ets has further increased the competition between the firms in the industry. $he competitions had gi!en raise to demand for speciali4ed products and s#ills of !arious indi!iduals who can contribute towards the containment and growth of indi!idual firms in the mutual firm industry. $his ga!e rise to !arious related organi4ations and indi!iduals wor#ing as speciali4ed teams in the !arious areas of mutual funds. -ne such organi4ation is IN6IA IN9. 0IN- P;T 0T6 it comes into pictures where the in!estors apply for the units in a Mutual &und schemes and !erify the !alidity and eligibility of the in!estor and allots the units $he mutual fund companies now recei!e millions of applications if a new scheme is launched.

$his is due to the wide spread awareness created among the urban and rural Population of India. It therefore becomes a "erculean tas# to Manage the flooding applications "owe!er it should be noted that this is a -ne time acti!ity similar to that of a short run project It is needless to /tate that a gi!en mutual fund firm will not be possessing $he technological, human and #nowledge resources to ta#e up such a gigantic tas#, it is in fact not needed by a mutual fund firm to create such a !ast organi4ational structure when it is seen from the point of !iew scale of economies. &urther to this problem, the mutual fund industry does not #now where it stands in the current !olatile and turbulent en!ironment. $his may be $he reason they prefer to hire the ser!ices of professionals firm with speciali4ed #nowledge and +%pertise.

$hese de!elopments ha!e led to an outcome that today, launching of mutual fund scheme has become a well organi4ed acti!ity which is accomplished through the coordinated endea!ors of tas# groups. $he asset management companies ha!e designed !arious schemes in accordance with the re)uirements of the !arious sections on in!estors on basis of e)uity lin#ed, debt instruments lin#ed, commodities lin#ed and specific industry lin#ed instruments. $he in!estor today is gi!en a wide

range of options to in!est in !arious types of funds according to his interests and capabilities. Mutual funds enable e!en a small in!estor to in!estor to in!est, as most of the mutual funds just start from a minimum amount of in!estment of */. 7888 hence e!en a small in!estor can in!est into a mutual fund and reap returns in the same proportions as the other big time in!estors. $his shows that mutual fund industry is one which aims at e!ery section of the society. $o deal with this large population of in!estors and the competition, the asset management company has been forced to de!elop and design new schemes and hire the ser!ices of professionals.

mutual fund industry in!ol!es !arious operations from the stage of identification of the target group or defining a mar#et segment, designing a scheme which comes up to the e%pectations and aspirations of the target group or mar#et segment, reaching the selected mar#et through launching the scheme which is thereby called ,&-, till the stage of in!esting the amount raised in accordance with the norms stipulated with offer document and distributing the returns to the in!estor by way of di!idend, after ma#ing ade)uate pro!ision for ta%ation and other operating costs. All this process is well organi4ed and performed in a specific order. $here are !arious related organi4ations which speciali4e in the acti!ities at !arious stages of the functioning of the mutual funds.

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It is therefore felt e%pedient to e%amine the !arious intricacies in!ol!ed in the new fund offer ',&-(. /pecifically the !arious documents that are being processed, the parameters e!ol!e either customarily or by legal mandate to scrutini4e the applications. 0arious stages in!ol!ed in the scrutiny, the rejection criteria, the creation of human organi4ation to monitor the acti!ities, the communication channel and the structure of the organi4ed acti!ities and the legal en!ironment of ,&- to some e%tent. /uch a

dissertation would help to come out with a comprehensi!e report which may ser!e as a guide for the prospecti!e entrants into mutual fund in!estment and to the e%isting mutual fund in!estors to some e%tent.

Ob ecti!es o" the study:

9 $o study the technical, procedural, legal dimensions of the ,&9 $o e%amine briefly the organi4ational structure,

communication networ#, resource re)uirements to launch a new fund 9 $o study a sample of application drawn from *eliance Mutual &und.

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Methodo#o$y o" study:

$o fulfill the objecti!e of the study both primary and secondary data has been collected. Primary data is the data collected specifically for the study. .ata is collected directly from people and organi4ations !ia )uestionnaires or sur!eys before being analy4ed to reach conclusions concerning the issues co!ered in the )uestionnaire or sur!ey. In this study primary data was collected through interaction with staff of India info line P2t 0td# and the applications of *eliance e)uity fund. /econdary data is the data collected pre!iously by someone else for some other purpose which can be analy4ed and interpreted according to re)uirements. &or e%ample, sources of secondary data are go!ernment

publications, newspapers, worldwide web etc. In this study the /econdary data is mainly ta#en from 9 9 9 $he company:s training material. *econciliation statements. -ther documents generated with in the organi4ation 2hich ha!e to Access; < www. indiainfoline.com, www.amfiindia.com,www.sebi.com.

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Li%it&tions o" study:

Analysis of the applications is carried out by ta#ing the applications from *eliance e)uity &und. $he data a!ailable is therefore restricted by the design of the application.

$he inspection of applications is done on the basis of a sample of <=8 applications. $hough the sample is drawn randomly, the possibility of sampling fluctuations affecting the findings cannot be ruled out.

,umerical data li#e number of applications recei!ed, total subscription amount recei!ed, statement of accounts, in!estor details, etc are not a!ailable and therefore a description of these aspects is gi!en.

,&- process may not be same for all mutual funds that are released. It may differ from one fund to other depending upon the si4e li#e the no. of applications recei!ed, subscription amount recei!ed, etc.

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REVIEW OF LITERATURE

Ne' "und o""er (NFO):

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2hen a mutual fund asset management company announces Public issue of units of a new fund>scheme it is called a ,ew &und -ffer 'N9.(. 2hen a mutual fund company plans for a new fund offer it first informs to the registrar or the bac# office functions pro!ider li#e I,.IA I,&- 5I,+

through email. $his is called as ?,&- 5aunching Information Mail@ send by the fund manager of the asset management company to the ,&coordinator of the I,.IA I,&-5I,+. In this Mail the fund manager will as# the ,&- coordinator to get ready for the new fund with the re)uired man power and software. 5ater they send the sample application form, the #ey information

memorandum ' I"( and offer document to IN6IA IN9. 0IN-. $his offer document sets forth concisely, necessary information about the scheme for a prospecti!e in!estor to ma#e an informed in!estment decision on the scheme described. $he offer document contains the salient features of the scheme li#e ,&- opening date, ,&- closing date, /cheme name, /cheme class, reopening date, plans a!ailable ban#s in!ol!ed, number of ban# branches in!ol!ed, minimum amount A fresh purchase, ma%imum amount A fresh purchase, e%pected number of applications, entry load and e%it load. $he unit manager or the ,&- coordinator will arrange a meeting where the AMC team, ,&- e%pert:s team, .ata entry team, *econciliation team and the dispatch team will discuss and fi% the target dates by which the wor# has to be completed accordingly.

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Wh&t is & %utu&# "und=

Mutual fund is a mechanism for pooling the resources by issuing to the in!estors and in!esting funds in securities in accordance with objecti!es as disclosed in offer document. In!estments in securities are spread across a wide cross6section of industries and sectors and thus the ris# is reduced, .i!ersification reduces the ris# because all stoc#s may not mo!e in the same direction in the same proportion at the same time. Mutual fund issues units to the in!estors in accordance with )uantum of money in!ested by them. In!estors of mutual funds are #nown as unit holders. $he profits or losses are shared by the in!estors in proportion to their in!estment. $he mutual funds normally come out with a number of schemes with different in!estment objecti!es which are launched from time to time. A mutual fund is re)uired to be registered with /ecurities and +%change Board of India 'S-$I( which regulates securities mar#ets before it can collect funds from the public. Mutual fund is a collection of stoc#s and > bonds. A mutual fund as a company brings together a group of people and in!ests their money in stoc#s, bonds and other securities. +ach in!estor owns shares, which represent a portion of the holdings of the fund. 2ith increased uncertainties or fluctuations in the primary mar#et and decreasing ban# interest rates, mutual funds are gaining popularity day by day ,ow6a6 day:s mutual funds are performing well will high returns to the

16

in!estors. $here are !arious types of schemes and plans a!ailable to all type of in!estors. 5et us assume that you inertia million rupees o!er night and want to in!est the same to get better returns you can consider the following in!estment a!enues that are popular in Indian conte%t Company shares &i%ed deposits in ban#s Go!ernment bonds &i%ed deposits in ,B&C Chit fund *eal estate -ther local money lending options

*ros &nd con+s o" the in!est%ents:

/,-. In!estment a!enue Company shares and stoc#s &i%ed deposits in ban#s Go!t. bonds &i%ed deposits in ,B&C Chit funds *eal estate -ther money lending options *is# *eturn +ffort re)uired to trac#>maintain in!estment "igh 5ow Medium Medium Medium Medium .epends

<. =. B. C. 7. D. E.

"igh 5ow Medium "igh "igh Medium Medium

"igh 5ow Medium Medium Medium Medium Medium

,o' you c&n %&-e %oney "ro% & %utu&# "und=

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If the fund sells the securities that ha!e increased in price, the fund has a capital gain Most of the funds also pass on these gains to in!estors in a distribution. If fund holdings increase in price but are not sold by the fund manager, the funds shares increase in price. 1ou can then sell your mutual fund units for profit. &unds will also usually gi!e you a choice either to recei!e a chec# for distributions or to rein!est the earnings and get more shares. Income it earned from di!idends on stoc#s and interest on bonds. A fund pays out nearly all income it recei!es o!er the year to fund owners in the form of a distribution.

Ty.es o" Funds:

Mutual funds also come in !arious si4es and shapes. $here are about do4en fund classes but all of them are deri!ati!es of three basic classes are as follows. Growth Income 5i)uidity

Gro'th: 5ong term growth, since these funds in!est in e)uities, they are
also called as e)uity funds. $heir ris# le!el is high so is the return.

Inco%e: $his type of fund pro!ides regular income by in!esting in debt

instruments li#e bonds, debentures etc., Because of their nature of

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in!estment, they are also called debt schemes. $heir ris# and return le!els are medium.

Li/uidity: $hese are primarily in!ested in money mar#et instruments and

thus most !olatile, safer and gi!e lower returns. $hese funds are also #nown as cash or money mar#et funds. In addition to the abo!e type there are other deri!ati!e classes as listed below. This type of fund### $alanced fund In2est in this area Is an in!estment blend of e)uity and dept Instruments Inde> fund In!ests in the companies that participate in stoc# mar#et indices in the same weight age comprising of an inde% Sector fund In!ests in companies pertaining to specific sectors li#e health care, ban#ing, &MCG, technology etc. -lls ? Ta> funds In!ests is Go!ernment bonds and generally long term in nature. $hey pro!ide ta%

benefits.

$hese are called mutual fund schemes. It is based on the in!estment objecti!e. $here is another Classification based on the capitali4ation of funds. If the fund offers purchase or selling on a Continuous basis it is called

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open ended mutual fund. -n the contrary, if the fund is open only for a particular period, it is called closed ended fund.

Di""erences:
/,-. <. =. B. C. 7. D.

O.en ended &nd C#osed ended "unds

-pen ended nlimited 1es 1es 1es ,o 'with e%emption of &MP schemes( Generally ,o Closed ended 5imited ,o ,o ,o 1es 1es

&eature Capitali4ation Any time entry Any time e%it $a% ad!antage A!ailable for a fi%ed period 5isted on the e%change

-pen ended funds gained popularity because of their fle%ibility and !ariety of features they offer. &or this reason, majority of the mutual funds are Fopen: in nature.

Ar%s o" & %utu&# "und:

Primarily mutual fund is formed as a trust by a group of sponsors. $hey are the owners of the mutual funds and forms trust by a group of sponsors. 20

$hey are the owners of the mutual funds and forms trustees who in turn appoint AMC and manage the mutual fund. /+BI regulations re)uire that at least two at least two thirds of the directors of trustee company or board of trustees must be independent i.e. they should not be associated with the sponsors. Also, 78G of the directors of AMC must be independent. All mutual funds are re)uired to be registered with /+BI before they launch any scheme.

This entity@ Sponsor Trustees

Asset mana%ement company Re%istrar 6istributors

6oes this@ 9orms "f as a trust# Re%isters with S-$I# Holds funds in2ested in a form of units# -nsure compliance with S-$I# Appoints A", 9loats "9 Schemes4 "ana%es funds and cash# Holds in2estor data# 6o ser2ices to in2estors "arAet 2arious schemes of "9

Tr&ns&ction ty.es (co%%erci&# 0 non1co%%erci&#) :

5et:s compare !arious transactions of mutual funds with those of ban#s.

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In a banA4 you will@ .pen an account with initial deposit 6eposit money Bith draw money .pt for a recurrin% deposit

In a mutual fund@ 5ou subscribe in a scheme and buy units 6o additional purchases 5ou redeem units Start a systematic in2estment plan

/ince mutual fund offers many more options to in!estors, it will ha!e many more transaction types as well. 5et us see some popular transactions in mutual funds SN.# +# 6escription New in2estment# $uyin% units in a scheme '# Additional purchase $uyin% additional units in a scheme C# Redemption Sellin% units and %ettin% money bacA# (# Switch?shift Transferrin% in2estment from one scheme to other# D# 6i2idend Bhen A", announces di2idend in a scheme# *# Systematic In2estin% fi>ed in2estment amounts periodically liAe a recurrin% deposit# E# Systematic with Re2erse of drawl systematic in2estment Sellin% units periodically *est are relating to general maintenance only. /o they are non6commercial transactions. Net &sset !&#ue: As you must ha!e noticed, we always tal# about :units: in a mutual fund and not money itself. A unit is basic measure of in!estment n a mutual fund. 22 Transaction New purchase

+ach scheme > plan will ha!e a different mar#et !alue is called the ,et asset !alue or simply ,A0. /ince mar#et !alue of the underlying securities changes e!ery day, ,A0 of a scheme also !aries on a day to day basis.
NA2 3 Tot&# &ssets 4 Tot&# #i&bi#ities5Nu%ber o" units

SEBI Guide#ines on Ne' Fund O""er:

+# Procedure for launchin% of schemes:
1+3

,o scheme shall be launched by the asset management company unless

such scheme is appro!ed by the trustees and a copy of the offer document has been filed with the Board.
1'3

+!ery mutual fund shall along with the offer document of each scheme

pay filing fees as specified in the /econd /chedule. '# 6isclosures in the offer document:
1+3

$he offer document shall contain disclosures which are ade)uate in order

to enable the in!estors to ma#e informed in!estment decision Hincluding the disclosure on ma%imum in!estments proposed to be made by the scheme in the listed securities of the group companies of the sponsorI.
1'3

$he Board may in the interest of in!estors re)uire the asset management

company to carry out such modifications in the offer document as it deems fit.
1C3

In case no modifications are suggested by the Board in the offer

document within =< Hwor#ingI days from the date of filing, the asset management company may issue the offer document.

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1(3

,o one shall issue any form of application for units of a mutual fund

unless the form is accompanied by the memorandum containing such information as may be specified by the Board. C# Ad2ertisement material:
1+3

Ad!ertisements in respect of e!ery scheme shall be in conformity with

the Ad!ertisement Code as specified in the /i%th /chedule and shall be submitted to the Board within E days from the date of issue.
1'3

$he ad!ertisement for each scheme shall disclose Hin!estment objecti!e

for each schemeI (# "isleadin% statements: $he offer document and ad!ertisement materials shall not be misleading or contain any statement or opinion, which are incorrect or false. D# 0istin% of close ended schemes: +!ery close ended scheme shall be listed in a recogni4ed stoc# e%change within si% months from the closure of the subscription Pro!ided that listing of close ended scheme shall not be mandatory.
1a3

If the said scheme pro!ides for periodic repurchase facility to all the unit

holders with restriction, if any, on the e%tent of such repurchaseJ or

1b3

if the said scheme pro!ides for monthly income or caters to special

classes of persons li#e senior citi4ens, women, children, widows or physically handicapped or any special class of persons pro!iding for repurchase of units at regular inter!alsJ or

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1c3

If the details of such repurchase facility are clearly disclosed in the offer

documentJ or
1d3

If the said scheme opens for repurchase within a period of si% months

from the closure of subscription. *# Repurchase of close ended scheme:

1+3

$he asset management company may at its option repurchase or reissue

the repurchased units of a close ended scheme.

1'3

$he units of close ended schemes referred to in the pro!iso to regulation

may be open for sale or redemption at fi%ed pre6determined inter!als if the ma%imum and minimum amount of sale or redemption of the units and the periodicity of such sale or redemption has been disclosed in the offer document.
1C3

$he units of close ended scheme may be con!erted into open ended

scheme.
1a3

If the offer document of such scheme discloses the option and the period

of such con!ersionJ or
1b3 1(3

$he unit holders are pro!ided with an option to redeem their units in full. A close ended scheme shall be fully redeemed at the end of the maturity

period HPro!ided that a close ended scheme may be allowed to be rolled o!er if the purpose, period and other terms of the roll o!er and all other material details of the scheme including the li#ely composition of assets immediately before the roll o!er, the net assets and net asset !alue of the scheme, are

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disclosed to the unit holders and a copy of the same has been filed with the Board. Pro!ided further, that such roll o!er will be permitted only in case of those unit holders who e%press their consent in writing and the unit holders who do not opt for the roll o!er or ha!e not gi!en written consent shall be allowed to redeem their holdings in full at net asset !alue based price. E# .fferin% Period: ,o scheme of a mutual fund other than the HinitialI offering period of any e)uity lin#ed sa!ings schemes shall be open for subscription for more than C7 days 7# Allotment of !nits and refund of money:
1+3 1a3

$he Asset management company shall specify in the offer document $he minimum subscription amount it see#s to raise under the scheme

and
1b3

In case of o!er subscription the e%tent of subscription it may retain

Pro!ided that where the asset management company retains the o!er subscription referred to in clause 'b(, all the applicants applying up to fi!e thousand units shall be gi!en full allotment subject to the o!ersubscription mentioned in clause 'b(.
1'3

$he mutual fund and asset Management Company shall be liable to

refund the application money to the applicants6

1i3

If the mutual fund fails to recei!e the minimum subscription amount

referred to in clause 'a( of sub6regulation '<(J

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1ii3

If the moneys recei!ed from the applicants for units are in e%cess of

subscription as referred to in clause 'b( of sub6regulation '<(.

1C3

Any amount refundable under sub6regulation '=( shall be refunded

within a period of si% 2ee#s from the date of closure of subscription list, by *egistered A.. and by che)ue or .emand .raft mar#ed KA>C PayeeK to the applicants. In the e!ent of failure to refund the amounts within the period specified

1(3

in sub6regulation 'B(, the asset management company shall be liable to pay interest to the applicants at a rate of fifteen percent per annum on the e%piry of si% wee#s from the date of closure of the subscription list. F# !nit certificates or Statement of Accounts: $he asset management company shall issue to the applicant whose application has been accepted, unit certificates or a statement of accounts specifying the number of units allotted to the applicant as soon as possible but not later than si% wee#s from the date of closure of the Hinitial subscription list and or from the date of receipt of the re)uest from the unit holders in any open ended schemeI.Pro!ided that if an applicant so desires, the asset management company shall issue the unit certificates to the applicant within si% wee#s of the receipt of re)uest for the certificate. +&# Transfer of units: '<( A unit certificate unless otherwise restricted or prohibited under the scheme, shall be freely transferable by act of parties or by operation of law.

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'=( $he asset management company shall, on production of instrument of transfer together with rele!ant unit certificates, register the transfer and return the unit certificate to the transferee within thirty days from the date of such production. Pro!ided that if the units are with the depository such units will be transferable in accordance with the pro!isions of the /ecurities and +%change Board of India '.epositories and Participants( *egulations, <LLD.

++# 6ispatch of warrants and proceeds: +!ery mutual fund and asset management company shall,
1a3

.ispatch to the unit holders the di!idend warrants within HB8 daysI of

the declaration of the di!idend. 1b3 .ispatch the redemption or repurchase proceeds within <8 wor#ing days from the date of redemption or repurchase. 1c3 In the e!ent of failure to dispatch the redemption or repurchase proceeds within the period specified in sub6clause 'b(, the asset

management company shall be liable to pay interest to the unit holders at such rate as may be specified by Board for the period of such delay. 1d3 Aside payment of such interest to the unit holders under sub6clause 'c( the asset management company may be liable for penalty for failure to dispatch the redemption or repurchase proceeds within the stipulated time. 2here!er an application for a total !alue of */. 78,888 or more, the applicant or in the case of application in joint names, each of the applicants,

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should mention his>her permanent account number 'PA,( allotted under the Income $a% Act, <LD< or where the same has not been allotted, the GI* number and the income6ta% Circle>2ard>.istrict should be mentioned. In case where neither the PA, nor the GI* number has been allotted, the fact of non6allotment should be mentioned in the application form. Any application form without these details should not be accepted by the mutual fund. $he abo!e clarification is being issued in accordance with *egulation EE of the /+BI 'Mutual &unds( *egulations, <LLD. +'# Instructions for filin% scheme offer document with S-$I: As ad!ised in /+BI circular M&.>CI*>8D>=E7>=88< dated Muly L, =88<, while filing offer document for launching a new scheme>re!ising and filing e%isting offer document with /+BI, the mutual funds should highlight and clearly mention the page number of the offer document on which each of the following obser!ation has been incorporated. In case of any amendment to *egulations, the new pro!isions should be incorporated in the offer documents.

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COMPANY PROFILE
30

COM*AN6 *ROFILE:
Circa<LL7. A group of professional formed a company called Probity *esearch N /er!ices P!t 5td. $he name was later changed to India Info line 5td. $he -bjecti!e was to pro!ide unbiased and independent information to mar#et intermediaries and in!estors. $he )uality of research soon caught the imagination of all major participants in the financial mar#et. In a span of = to B years the client list read li#e the who:s who of Indian &inancial mar#et. $he list included consulting firms li#e Mc Oinsey, companies li#e "industan 5e!er, Ban#s li#e Citiban#, *ating agencies li#e C*I/I5, .NB, &I/, foreign bro#ers as well as leading Indian bro#ers. -ne fine morning in early <LLL, a colleague had a cra4y idea that if the company made all the research a!ailable free on the web, the number of users may well jump from =78 to =.7 million. $o ma#e it true, the business re)uired a reincarnation. And the pre6re)uisite was a death. It meant that

31

the company put up all the information free on the website and let go of all the re!enues and profits. 2orse, if the new a!atar failed, there would be Fno comebac#s:. $he company became hea!ily dependent on its e6bro#ing business for sur!i!al. $he odds were against them. $here was no money a!ailable from the pri!ate e)uity in!estors at any !aluation. $he core promoters of the company had little e%perience of bro#ing. $o add to it, the mar#et was hit by a scam. $hey also had their share of price to pay and lessons to learn. It was difficult to retain people. Although de!astating for morale, but not surprising, most mar#et obser!ers had written them off.

$here was a core group who ne!er lost hope. $hey cut all possible costs and wor#ed on a bare bones structure. $hey sur!i!ed against all odds and started capturing mar#et share. $he company rose from strength to strength to become the leading corporate agent in life insurance and among the top retail players in mutual fund and bro#ing space.

Our Key Mi#estones:

Incorporated on -ctober <P, <LL7 as Probity Research G Ser2ices# 5aunched Internet portal www#indianinfoline#com in May <LLL. Commenced distribution of personal financial products li#e Mutual &unds and *BI Bonds in April =888. 5aunched online trading in shares and securities branded as www#Dpaisa#com in Muly =888. /tarted life insurance agency business in .ecember =888 as a Corporate Agent of ICICI Prudential 5ife Insurance. Became a depository participant of ,/.5 in /eptember =88<.

32

5aunched stoc# messaging ser!ice in May =88B. Ac)uired commodities bro#ing license in March =88C. 5aunched portfolio management ser!ices in August =88C. 5isted on NS- and $S- on May <E, =887. Ac)uired E7G sta#e holding in Money tree Consultancy ser!ices, which is a distributor of Mortgages and other 5oan products, in -ctober =887.

Ac)uired <88G e)uity of March Mont Capital Ad!isors P!t 5td in .ecember =887 through which we ha!e !entured into Merchant Ban#ing.

./P Merrill 5ynch Capital subscribed to con!ertible bonds aggregating *s.P8crores in .ecember =887. $heir current sta#e in India Info 5ine is a little o!er <C G as on B<st March =88E.

Bennett Coleman N Co 5td 'BCC5( in!ested *s.=8crores in India Info line by way of preferential allotment in .ecember =887. Became a depository participant of C./5 in Mune =88D. Merger of India Info line /ecurities Pri!ate 5imited with India Info line 5imited in Manuary =88E. +ntered into an alliance with Ban# of Baroda for Baroda e6trading in &ebruary =88E. I*.A license for Insurance Bro#ing April =88E.

Our M&n&$e%ent Te&%:

"r#Nirmal Jain 1,hairman and "ana%in% 6irector3 ,irmal Main is the founder and Chairman of India Info line 5td. "e holds an MBA degree from IIM Ahmedabad, and is a Chartered Accountant 'All India *an# =( and a Cost Accountant.

33

"r# R#;enAataraman 1->ecuti2e 6irector3 *. 0en#ataraman is the co6promoter and +%ecuti!e .irector of IndiaInfoline 5td. "e holds a B tech degree in +lectronics and +lectrical Communications +ngineering from II$ Oharagpur and an MBA degree from IIM Bangalore. "e has held the position of Assistant 0ice President with G + Capital /er!ices India 5imited in their pri!ate e)uity di!ision.

The Bo&rd o" Directors:

"r# Sat Pal hattar 1Non ->ecuti2e 6irector3

Mr. /at Pal Ohattar joined the Board with effect from April =8, =88<. Mr. /at Pal Ohattar is a lawyer by profession. "e is a director of a number of public companies in /ingapore and India.

"r# Sanji2 Ahuja 1Independent 6irector3 Mr. /anji! Ahuja joined the Board with effect from August =P, =88=. Mr. Ahuja graduated from ,ational ni!ersity of /ingapore with a

degree in Computer /cience and is also a Certified Public Accountant. "e started his own in!estment ad!isory and consulting company in =88<, named Centennial Management Consultants Pri!ate 5imited. "r# Nilesh ;iAamsey 1Independent 6irector3

34

Mr. ,ilesh /hi!ji 0i#amsey joined the Board with effect from &ebruary <<, =887. Mr. 0i#amsey )ualified as a Chartered Accountant in <LP7 and has been a member of the Institute of Chartered Accountants of India since <LP7.

"r#

ranti Sinha 1Independent 6irector3 Mr. Oranti /inha joined the Board with effect from Manuary =E, =887. Mr. /inha graduated from the Agra ni!ersity with a Masters degree.

Mr. /inha is also on the Board of .irectors of "industan Motors 5imited, 5arsen N $urbo 5imited N 5IC"&5 Care "omes 5imited.

Our 2ision7
Its !ision will not be accomplished only by maintaining high growth alone. -ur !ision is to emerge as the most respected financial ser!ices company in India. ,eedless to emphasi4e that it is imperati!e for all us to align our personal goals and !alues to this !ision.

Kno'#ed$e:
Always #eep yourself up6to6date by reading newspapers li#e +conomics $imes, Business standard and Business 5ine daily. Passing ,C&M, AM&I, I*.A e%ams also help you to get basic domain understanding. 2e are in a #nowledge industry and hence we cannot afford to go to a client and appear ignorant and foolish by not e!en #nowing basic things.

Techno#o$y:

35

By technology, we mean that as an organi4ation, we le!erage technology to deli!er best ser!ice to our clients at the least cost. -ur trading interface for bro#ing is absolutely world class. 2e e%pect our employees to be comfortable with and confident of using technology.

Ser!ice7
-ur customer ser!ice is warm, friendly and responsi!e that media cannot help but ra!e about. $oday, ser!ice is the #ey dri!er for growth in financial ser!ices. 2e ta#e pride in our ability to add !alue that our customers can feel and appreciate. *emember we ha!e to always ensure that simple things li#e ensuring customer problems are sol!ed, re)uests are catered to, gi!ing him in!estment ideas etc. Basically, whate!er it ta#es to #eep him ser!ed.

36

ANALYICAL FRAME WORK

37

NFO .rocess:
2hen a mutual fund Assets Management Company 'A",( announces a public issue of units of N new fund>scheme, it is called a new fund offer 'N9.(. $he new fund is planned and sources from where it should be collected and where the amount should be in!ested is planned by the AMC. According to the /+BI rules any new fund launched should be appro!ed by /+BI. -nce the AMC get the appro!al of /+BI for the fund it does the mar#eting of the fund by it self or through bro#ers. $he in!estors who are willing to in!est in a particular fund deposit the amount they plan to in!est in the ban# as directed by the AMC. $hese ban#s collect the application and amount and direct it towards the registrar specified by the AMC. &rom this point India info line came into the picture as the registrar. $he role, responsibilities, acti!ities, forms and reports in!ol!ed in this process of ,&- is general, are AMC, fund manager, /IP I>c, /witches I>c., ,&- Coordinator. Internal auditor, /ystems'/>2( dept. IP- Centre coordinator, IP-6*$I, IP-6+.P, /canning and Printing N .ispatching. $eams in!ol!ed in the ,&- process) Mutual fund unit 38

 $echnology team .ata entry team 0erification team +%ternal audit team /canning team &ran#ing and dispatching team

39

40

41

42

Descri.tion o" NFO .rocess:

$anA wise se%re%ation: $he India info line branches collect the applications of the in!estors across India and abroad for all the branches of the ban# that is in!ol!ed in this ,&-. $hese applications are sent to India info line processing center, "yderabad. After recei!ing, these applications are segregated ban# wise and branch wise. IH Numberin%: I" numbering is also called as In house ,umbering. India info line gi!es this I" numbering to those applications. $his is done for their con!enience in

doing bac# office functions easily. All the data on the application is entered into systems through software de!eloped by India info line technology team called O6Bolt. 5ater on, we can get any information of a particular

application or in!estor that we re)uire by entering this I" number. $indin%: All the applications that are recei!ed are gi!en for binding. Binding of

application is done by segregating them according to the ban# and branch fro which they are recei!ed. India info line does this Binding because to #eep all these applications safe, out of any damage and miss6place.

9irst -ntry: After finishing binding of applications they are sent to .ate +ntry team. "ere the first time entry is done. All the information or date of an in!estor

43

that is a!ailable on the application li#e name of the applicant, age, Address, PA,, Ban# details, bro#er code, sub bro#er code, email addresses, guardian name, amount in!ested, name of the scheme or plan in!ested in, etc., are entered into the systems of India info line. Second -ntry: After first entry the data is again sent for the second entry. "ere in second entry, the data that is entered in first entry is chec#ed and the information what e!er is missing is entered.

.nline "atchin%: After entering the data li#e applicant, age, Address, PA,, Ban# details, bro#er code, sub bro#er code, email addresses, guardian name, amount in!ested, name of the scheme or plan in!ested in, etc., in the first entry and once again in the second entry it is sent to the online matching. "ere in online matching the physical form of application are #ept side by an chec#ing of data that was entered in the first entry and second entry is done. 9irst time 2erification: .ata from online matching is sent to the !erification team. $his team !erifies mista#es that are left in online matching. Mista#es li#e blan# address, PA, blan# for amount greater than or e)ual to 78888 */. ,ame blan#, ban# details blan#, in!alid or blan# bro#er code etc., are rectified in the first time !erification. 9irst time ,,0: 44

&irst time chec# clearing list is in short is called as first time CC5. &irst $ime CC5 is prepared based on the data that is pro!ided after first time !erification. ->ternal Audit: &irst time chec#6clearing list is sent to an e%ternal audit team. India info line appoints this team before the ,&- processes. $hey are nowhere related to the organi4ation. $his e%ternal audit team will mainly chec# name of the in!estor, amount in!ested, ban# details PA, number, name of the scheme>plan and mode of holding 'M-"(. But in total they will chec# more than B8 characters Second time 2erification: If the e%ternal auditing is not satisfied and if they find any mista#es or missing information they will send the first time CC5 for second time !erification. "ere they !erify the chec# list once again and mista#es li#e in!alid mode of folding 'M-"(, in!alid email address, status minor without guardian name, in!alid date of birth for minor, in!alid e%isting account number, blan#>null application number, ,*I with blan# account type, sa!ing or current, in!estor signature missing are rectified. Second time ,,0: /econd chec# the !erification team prepares clearing after !erifying the mista#es that are pointed out by the e%ternal audit team. After preparing second time CC5 it is again sent to e%ternal audit team. Inte%rity ,hecA 1N9. team3:

45

Chec# clearing list will be gi!en by the e%ternal audit team to the ,&- team in India info line $his ,&- team in India info line will once again chec# further mista#es li#e spelling mista#es in the name of the applicant etc., and rectify them. Inte%rity ,hecA 1by Audit3: After integrity chec# by the ,&- team it is once chec#ed by the internal audit team of India info line. Scannin% 6efault ;alues4 ;erification of "ismatch cases: +ntire data is filtered at each and e!ery step and finally it is gi!en to the scanning team for scanning here scanning team will detect and rectify any further default !alues and mismatch cases. Reconciliation4 Rejections and ,heHue returns: Che)ues of the in!estors are sent are sent by the bal# to India info line *econciliation team. "ere this team will !erify ban# details of the in!estor li#e PA, number, ban# a>c number, comparing the amount in!ested with that of the minimum amount that has to be in!ested che)ues with out hue signature of the in!estor bounced che)ues etc., and they are rejected. $hese rejected che)ues are dispatched to the in!estors. A sample statement of accounts '/-A( is prepared by this reconciliation team.

Handlin% o2er the data to "9S:

46

+ntire data after getting filtered at each and e!ery step will be handing o!er to mutual fund ser!ices team. $his M&/ team will once again !erify the data and the final data will come out any mista#es and default !alues. Portin% in TasA "9: $as# M& is the software de!eloped by India info line $echnology team. It is prepared according to the suggestion gi!en by AMC. $his $as# M& will resemble the style or Performa or outloo# of the statement of accounts. &inal data that they got after filtering the mista#es and default !alues is ported in the tas# M&. Allotment of units: Allotment of units is done as per the amount that is in!ested by in!estors. $hey will a!ail the units ta#ing the ,et Asset 0alue ',A0( of that particular scheme as base. Sample S.A 2erification by audit: /tatement of accounts '/-A( is pic#ed up randomly from a huge lot and the audit team does !erification. $his !erification will result in preparing a statement of accounts which in cent percent correct and e%act.

$his /-A contains data li#eQ

47

9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9

,ame of the in!estor Address Ban# details Pan ,umber Guardian name Bro#er code /ub bro#er code ,ominee name ,ominee addresses =nd and Brd applicant name Amount in!ested ,o. -f units allotted &und name, /cheme ,ame, Plan ,ame N A>c no $ransaction type details Mode of redemption payment Mode of di!idend payment Mode of dispatch /tatus, occupation. Current balance, a!erage price, current cost, current ,A0 etc.,

6ispatch of S.A: /tatement of accounts '/-A( once prepared is dispatched to the in!estor. /-A:s are neatly pac#ed in an en!elope and dispatched to the in!estors by the dispatch team through courier.

New 9und Report: 48

India info line will finally prepare ,ew &und *eport. $his new fund report has to be submitted to the AMC. $hen AMC will submit a copy of the same to the /+BI, which is mandatory. $he new fund report details li#e
+3

/cheme details 9 9 9 9 9 9 /cheme name /cheme type .ate of opening .ate of closing the scheme > initial subscription period $arget amount Minimum amount to be raised

'3

/ubscription > Allotment details 9 ,umber of applications recei!ed with in the country 9 9 9 9 ,umber of ,*I applications recei!ed /ubscription amount recei!ed with in the country /ubscription amount recei!ed form ,*I .ate of allotment of units

C3 (3 D3 *3 E3

Initial issue e%penses .ate of dispatch of refund of refund orders nit holding pattern .istribution schedule Geographical .ispersion list

,o#din$ .ro"i#e o" &..#ic&nt7

49

*&rticu#&rs

Sin$#e

8oint

Anyone

Tot&#

N#$ #% &''()*&+,. #% &''()*&+,-

89 7/

" "

31 2!

12" 1""

80 70 60 9 o" &..#ic&nts 50 40 30 20 10 0

74

26

0 single Joint Anyone

Mode o" ho#din$

Interpretation0 It can be seen that majority of the applicants prefer to hold the allotted units indi!idually and =DG prefer to hold anyone>sur!i!ors. $his corroborates with the age profile of the applicants.

Occu.&tion .ro"i#e o" &..#ic&nts0

50

P&1,)*2(&1 B2-)+3-- S314)*3 S,253+, P1#%3--)#+&( R3,)135 #2-36)%3 O,731- T#,&( N#$ #% 3/ /! 2 / 7 23 5 12" &''()*&+,. #% 28 38 2 3 ! 19 / 1"" &''()*&+,-

40 35 9 o" &..#ic&nts 30 25 20 15 10 5 0 28

38

19

en t

sin e

rv ice

n! l

ou se $

et ir

St ud

es si o

Se

Bu

"

Pr o

Occu.&tion Interpretation0 Majority of the applicants are from ser!ices personnel at BPG, ne%t comes business People are =PG. $he housewife occupy Brd highest at <LG. It is found that professionals and retired are at the lowest.

STAT:S0
&8 Residential status of indi2idual applicants0

51

% t&

er s

ss

ed

ie

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

R3-)53+, 1"/ 9!

NRI / /

T#,&( 1"8 1""

120 100 9 o" &..#ic&nts 80 60 40 20 0 "esident St&tus '"( 96

Interpretation0 It can be obser!ed from the table and the chart that the majority of applicants are resident indi!iduals constituting LDG the applicants and remaining CG are the ,on6resident Indians.

98 Status of non)indi2iduals0

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

P&1,+31-7)' 1 1"

AOP:BOI " "

52

T12-, " "

UF 1" 8"

F(( " "

B&+;" "

P&1,)*2(&1C#<'&+= N#$ #% &''()*&+,- 1 . #% &''()*&+,- 1"

S#*)3,= " "

F( " "

SME 1" 8"

O,731- T#,&( " " " "

9 o" &..#ic&nts

90 80 70 60 50 40 30 20 10 0
&i ) er s

80

10 0
( % +r us t

10 0
,l l # S,

0
-s

0
y )! n

0
ity

0
,l

0
1 S0

0
er s % t&

*B

B! n

A% P

P! r

Non1indi!isu&#s

Interpretation0 In the non6indi!iduals category " & occupied the highest at P8G and ne%t <8G is for partnerships. In others category <8G is found and all other non6 indi!idual entities ha!e recorded 4ero applications .

A%e profile of the applicants0

P&1,)*2(&1- B3(#6 18 N#$ #% " &''()*&+,-

18>3" 3"

. o/

tn

31>!" 72

So c

A9#43 !" 18

T#,&( 12"

53

. #% &''()*&+,-

"

25

!"

15

1""

70 60 9 o" &..#ic&nts 50 40 30 20 10 0 0 Belo$ 18 18230 A$e 31260 A3ove 60 25 15 60

Interpretation0 $he age profile of the applicants shows that the majority of the applicants fall into the age Group B<6D8 years and the percentage of them being D8. $his is followed by the age Group <P6B8 years and <7G of the applicants are abo!e D8 years.

In2estment profile of the applicants0

P&1,)*2(&1-

5"""> 25"""

25""1> 5"""" 32

5"""1> 1""""" /

A9#43 1""""" !

T#,&( 12"

N#$ #% &''()*&+,- 78

54

. #% &''()*&+,-

!5

27

1""

70 60 9 o" &..#ic&nts 50 40 30 20 10 0

65

27

3 5000225000 25001250000 500012100000

A3ove 100000

A%ount in!ested

Interpretation0 Amount of in!estment is high at D7G in the range 78886=7888 and it is !ery low at BG in 7888<6<88888, but the ne%t slab. Abo!e <88888 7G. has registered

Scheme profile of applicants0

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

G1#6,7 #',)#+ 59 /9

B#+2#',)#+ / 3

D)4)53+5 13)+43-,<3+, 37 31

D)4)53+5 T#,&( '&=#2, 2" 17 12" 1""

55

60 50 9 o" &..#ic&nts 40 31 30 20 10 0 4ro$t& o)rion Bonus o)tion 5ividend reinvest/ent Sche%e 5ividend )!yout 3 17 49

Interpretation0 Majority of the applicants -pted the growth option and the option of di!idend rein!estment is B<G. $his means that P8G of the applicants are not in!esting for income sa#e rather they loo# at the accumulation of profits.

Analysis of mode of payment0

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

C73?23 119 99

DD 1 1

T#,&( 12" 1""

56

120 100 9 o" &..#ic&nts 80 60 40 20 1 0 .&e6ue Mode o" .&y%ent 55 99

Interpretation0 $he mode of payment reflects upon the )uality of applicants. -n an a!erage LLG ha!e paid through che)ues and therefore the ,&- is able to attract good )uality retail in!estors.

Analysis of type of account0

P&1,)*2(&1- SB N#$ #% 119 &''()*&+,. #% 99

C2113+, 1 1

NRO " "

57

NRE " "

FCNR " "

T#,&( 12" 1""

&''()*&+,-

120 100 9 o" &..#ic&nts 80 60 40 20 1 0 SB .urrent 0 '"% Ty.e o" &ccount 0 '"1 0 ,.'" 99

Interpretation0 Majority of the payments ha!e been made from /a!ings Ban# account '/B( # ,o payments ha!e been found from ,*-, ,*+, and &C,* e!en though CG of the applicants are ,*I s

/ender profile of the applicants0

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

M&(3 89 7/

F3<&(3 31 2!

T#,&( 12" 1""

58

80 70 9 o" &..#ic&nts 60 50 40 30 20 10 0

74

26

0!le Gender

,e/!le

Interpretation0 $he female participation in the ,&- is low at =DG. $he male applicants are !ery high at EDG as is not normally found in found in institutional in!estments.

/eo%raphical distribution of applicants0

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

A+571& P1&53-7 / 3

B)7&1 C7&+5)@7&1 D3(7) G2A&1&, K&1+&,&;& 1 1 1 1 17 1/ 11 9 5 /

59

P&1,)*2(&1N#$ #% &''()*&+,. #% &''()*&+,-

M&57=& M&7&1&-,1& R&A&-,7&+ P2+A&9 U,,&1 P1&53-7 1 1 /8 /" 2 2 2 2

T&<)(+&52

P1&53-7 5 ! / 5

P&1,)*2(&1W3-, B3+@&( N#$ #% &''()*&+,- 1" . #% &''()*&+,- 8

Interpretation0

O,731! 5

,#,&( 12" 1""

A predominant feature is that C8G of the applications are from Maharastra and ne%t highest <CG is registered for .elhi. 5owest numbers of applications are from Bihar and Chandighar.

45 40 35 30 25 20 15 10 5 0

40

9 o" &..#ic&nts

14 9 3 1 1 4 1 1 2 2 4 5 8 5

Pr !d es & . Bi &! &! nd r ig &! r 5 el & 4 i 8! u7 r rn !t !t 0 !!d &y 8 ! e ! Pr r i! 0 !d !& es !r & ! " s& !7 !s r! t& !n 9 P tt! un r P 7! r 3 +! !de / s : il ' & es t B !du en g % !l t& er s
60

An d& r!

St&tes

QUESTIONNAIR

61

;:ESTIONNAIR
1$ ARE YOU INTERESTED IN MUTUAL FUNDS BA8YES BB8NO
C< B< A< @< ?< >< =< < 6ES NO ?1D Co#u%n ?

1&rom the sampling of <88 people E8 percentage of people are really Interested in mutual funds#3 2$ W AT IS YOUR AGE GROUP BA825>35 BB835>/5 BC8/5>55 BD855>!5
@< ?A ?< >A >< =A =< A < AGE

>A1?A ?A1@A @A1AA AA1BA

1&rom the abo!e chart we can understand the age group 776D7 people are more in!esting in to the mutual funds3.

62

3$ W AT IS YOUR OCCUPATION BA8PRIVATE EMPLOYEE BB8GOVERNMENT EMPLOYEE BC8BUSINESS PERSON BD8RETIRED

?A ?< >A >< =A =< A < OCC:*ATION *RI2ATE EM*LO6EES GO2ERNMENT EM*LO6EES B:SINESS *ERSON RETIRED

1"ere ,umber of *etired employees are in!esting more as they are concerns about their future3. /$ IN W IC TYPE OF MUTUAL FUND DO YOU LIKE TO INVEST BA8CLOSE ENDED BB8 OPEN ENDED

D< C< B< A< @< ?< >< =< < M:T:AL F:NDS

O*EN ENDED CLOSE ENDED

1"ere open ended schemes are more fle%ible compare to close so Many people are interested into open ended schemes3.

63

5$ W AT PERCENT OF RETURN DO YOU ECPECT BA8 1">15 BB8 2">25 BC8 3">/" BD8 DOUBLING YOUR AMOUNT

B< A< @< ?< >< =< < EE*ECTING *ERCENTAGE DO:BLING 6O:R AMO:NT ><1?<9 ?<1@<9 =<1=A 9

1"ere ,umber of people li#es to double their amount. 3 !$ W IC TYPE OF FUND ALLOCATION DO YOU LIKE BA8 1"" PERCENT EQUITY BB8 8" PERCENT EQUITY & 2" PERCENT DEBT BC8 7" PERCENT EQUITY 2" PERCENT DEBT & 1" PERCENT MONEY MARKET BD8 1"" PERCENT DEBT
A< @< ?< >< =< < F:ND ALLOCATION C<9 E;:IT6 ><9 DEBT 0 =<9MONE6 MARKET =<<9 DEBT D<9 E;:IT6 0 >< 9 DEBT =OO9 E;:IT6

1"ere many in!estors are lo!e to in!est in <88 percent e)uity fund Allocation scheme.8

64

7$ IN W IC OF T E UTI SC EME YOU AVE INVESTED BA8UTI WEALT BUILDER FUND BB8UTI INFRASTRUCTURE ADVANTAGE FUND BC8UTI LONG TERM ADVANTAGE FUND BD8NONE
B< A< @< ?< >< =< < :TI SC,EMES :TI WEALT, B:ILDER F:ND :TI INFRASTR:CT:RE AD2ANTAGE F:ND :TI LONG TERM AD2ANTAGE F:ND NONE

1"ere the in!estors are li#ely to in!est in infrastructure ad!antage fund as this sector is in a booming stage.8 8$ ARE YOU SATISFIED WIT BA8YES BB8NO BC8CANNOT SAY
A< @< ?< >< =< < SATISFIED WIT, RET:RNS 6ES NO CANNOT SA6

T E RETURNS OF W IC

UTI IS GIVING

1$he abo!e chart is clearly saying that today according to mar#et situation many people are )uite satisfied with the return they are Getting.8

9$ AD YOU INVESTED IN ANY OT ER MUTUAL FUNDS BA8RELIANCE MUTUAL FUNDS

65

BB8D M FINANCIAL BC8FEDILITY MUTUAL FUNDS BD8 SBC

C< B< A< @< ?< >< =< <

RELIANCE M:T:AL F:NDS 8 M FINANCIAL FEDILIT6 M:T:AL F:NDS ,SBC

OT,ER M:T:AL F:NDS

1As people are speciali4ed in mar#et more the in!estors they all are In!esting in "/BC if not in $I because "/BC is the world:s local ban#

And international old more than =88 year old company8 1"$ DO YOU ADVICE PEOPLE TO INVEST IN MUTUAL FUNDS BA8YES BB8NO BC8CANNOT SAY
?A ?@ ?? ?> ?= ?< >F >D >C AD2ICE TO OT,ERS

6ES NO CANNOT SA6

NOTE0 As mutual funds is the subject to mar#et so people generally does not 5i#e to gi!e ad!ice to others as it is a ris#y business .

66

FINDINGS AND CONCLUSIONS

67

9indin%s and conclusions7 G $he ,&- is found to be a comple% acti!ity calling for creating an organi4ation polling the #nowledge and e%pertise of people in different areas. 9 $he ,&- process is simple and well structured as long as it is to in!estor to in!estor, but thereafter the process is lengthy time consuming and found to be o!erlapping at some stages. 9 $he /+BI regulations go!erning ,&- are comprehensi!e and protect in!estor3s interest at each le!el. 9 .ifferent funds ha!e been designing different forms of applications for ,&-. 9 An analysis of sample of applications re!ealed the following Majority applicants prefer to hold the units indi!idually. Majority of the applicants are in ser!ice. ,*I s share is about CG of the total. More than =>B rd of the applicants are " & s. $he model age group is B<6D8. $he most common in!estment amount is 78886=7888. About half of the applicants prefer Growth option. Almost all applicants ma#e the payments by che)ues. $here were no ,*-, ,*+ and &C,* accounts. Majority the applicants are male, and. Majority applications are from state of Maharastra

68

SUGGESTIONS AND RECOMMENDAIONS

69

Su%%estions and recommendations: < .ifferent funds ha!e been using different forms of applications. A standardi4ed form of application maybe designed by the competent authority and should be made mandatory for all funds to use the standard application form. < $he ,&- process is !ery comple% and there is a need to simplify the process by eliminating certain unnecessary steps in the process ie instead of carrying out audit for three times and appropriate internal chec# system maybe de!ised to #eep the errors within the tolerance limits. < $he ,*I subscribers to the fund maybe encouraged to ma#e the payments from ,*-, ,*+ and &C,* accounts. < $he application from institutional in!estors and foreign institutional in!estors are to be encouraged through a pac#age of incenti!es. 9 $he participation of senior citi4ens in the ,&- s may be encouraged as they are li#ely to hold more surpluses compared to others. 9 9 $he holding of units in joint names shall be encouraged. $here is a need to in!estigate the reasons for " & s occupying more than =>Brd share in the non6indi!idual applications as its not a body corporate. 9 A sa!ings from all channels of India > 2orld are to be tapped by the ,&- rather than one or two states applying for a loin share of the option. 70

71

BIBILOGRAPHY

Bibliography

9 9

www.Indiainfoline.com www.sebi.com

72

9 9 9 9

www.amfiindia.com ,&- propeller of India info line. ,&- records of *eliance Mutual &und. Mutual &unds in India by " /A."AO.

73