AProject Report On CUSTOMER EDUCATION

PROGRAM OF MUTUAL FUNDS:

A BUSINESS DEVELOPMENT INITIATIVE
FOR
RELIANCE NIPPON LIFE ASSET MANAGEMENT
LTD

Submitted in partial fulfillment of the requirements

for the award of the degree of

Master of Business Administration (MBA)

To

K.R. Mangalam University, Gurugram

Guide: Submitted by:

DR. ANSHIKA VINAY YADAV
1702570017

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 Certificate

I, Mr.VinayYadav Roll No.1702570017 certify that the Summer Internship Project

Report entitled “Customer Education Program Of Mutual Funds” is completed by me and
it is an authentic work carried out by me at Reliance. The matter embodied in this project
work has not been submitted earlier for the award of any degree or diploma to the best of
my knowledge and belief.

Signature of the Student

Date:

Certified that the Summer Internship Project Reportentitled “Customer Education

Program Of Mutual Funds” done by Mr. Vinay Yadav, Roll No. 1702570017 is completed
under my guidance.

Signature of the Guide

Date:
Name of the Guide: Dr. Anshika
Designation: Assistant Professor
K.R. Mangalam University

Countersigned

Director/Project Coordinator

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 501/2, Mehrauli-Gurgaon rd.
Sector 15 Part 2, Sector 15,
Gurugram, Haryana-122001
(CINL65910MH1995PLC220793)
www.reliancemutual.com

20th July, 2018

To WHOM-SO-EVER IT MAY CONCERN

This is to certify that Vinay Yadav has completed project work for the period
from 5th June 2018 – 5thJuly 2018 with Reliance Nippon Life Asset Management at
Gurugram.
During this time, He has exhibited great interest and enthusiasm.
His Project was “A Study on Customer Education Program of Mutual Funds – Business
Development Initiative”.
He completed the project successfully.
We value his contribution to Reliance Nippon Asset Management in terms of the insights
And recommendations of his project report.

Sheeba K Santha
Zonal HR Manager

Corporate Office:Reliance Nippon Life InsuranceReliance Centre, 5th Floor,

Off. Western Express Highway,Santacruz (East), Mumbai – 400055
A RELIANCE CAPITAL COMPANY

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ACKNOWLEDGEMENT

The internship opportunity I had with “RELIANCE NIPPON LIFE ASSET

MANAGEMENT LIMITED (RNLAM)” was a great chance for learning and
professional development. Therefore, I consider myself as a lucky individual as
I was provided with an opportunity to be a part of it.

I also take this opportunity to express my deepest gratitude and special

thanks to the Mr.VarunYadav,Regional Manager of RNLAM of Gurugram
Branch Office, who in spite of being extraordinarily busy with his duties, took
time out to hear, guide and keep me on the correct path and allowing me to
carry out my project at their esteemed organization.

I am very thankful to Dr. ANSHIKA, My Guide and Professor of K.R.

Mangalam Universityfor greatest support at every moment.

I express my deepest thanks to Mr. Manjunath, Relationship Manager

andMr. Govardhan, Relationship Officer, for taking part in useful decision &
giving necessary advices and guidance. I choose this moment to acknowledge
their contribution gratefully.

I perceive this opportunity as a great step in my career development. I will

strive to use gained skills and knowledge in the best possible way, and I will
continue to work on their improvement, in order to attain desired career
objectives. Hope to continue cooperation with all of you in the future too.

Finally, I would like to thank all the people from the organization who
provided me with valuable inputs and information for carrying out this project.

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 EXECUTIVE SUMMARY

Primary investment objective of any individual or organization is to maximize

the returns and minimizing Market risk and Credit risk through diversification
Mutual Funds (MF) have become one of the most attractive ways for the
average person to invest their money. It is said that Bank investment is the first
priority of people to invest their savings and the second place is for investment
in Mutual Funds and other avenues. A Mutual Fund pools resources from
thousands of investors and then diversifies its investment into many different
holdings such as stocks, bonds, or Government securities in order to provide
high relative safety and returns. The Project which tries to explain in layman‟s
language about the history, growth, & pros and cons of investing in Mutual
Funds and the second part of its deals with the analysis of risk and returns of
Equity(growth) ,

The main objective of the project was to get an Overview of Mutual Fund
Industry, its setup, its working and to find out the risks and returns of Equity, on
various schemes available tocustomers.The project includes a brief idea about
the growth of MF industry (History), the broad idea about the organization and
concept of MF and SEBI Guidelines on Mutual Funds. There are many
improvements pending in the field and it has to happen as soon
as possible so as to call the MF industry as an organized and well-
developed sector. The past performance of MF is not necessarily indicative of
future performance of the scheme and noAMC guarantees returns and or safety
of principal.

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 CONTENTS

S No Topic Page No
1 Certificate (s) 2
2 Acknowledgement (s) 4
3 Executive Summary 5
4 List of Tables -
5 List of Figures -
6 List of Symbols -
7 List of Abbreviations -
8 Chapter-1: Introduction 8-14
9 Chapter-2: Literature Review 15-18
10 Chapter-3: Data Presentation & Analysis 19-32
11 Chapter-4: Summary and Conclusions 33
13 References/Bibliography 33

LIST OF TABLES

Table No Title Page No

1.1 Number of Employees in Organisation ABC
2.1

LIST OF FIGURES

Figure No Title Page No

1.1 Sales Figures of RO Water Purifier 2006-2010
2.1

LIST OF SYMBOLS

S No Symbol Nomenclature & Meaning

1  Sigma (Summation)
2 @ At the rate
LIST OF ABBREVIATIONS

S No Abbreviated Name Full Name

1 CRM Customer Relationship Management
EPS Earnings Per Share

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ABSTRACT

MUTUAL FUND INDUSTRY:

A mutual fund is a professionally managed investment fund that pools money
from many investors to purchase securities
The main advantage of mutual funds is they provide stock diversification and
professional investors managing the account
There are a lot of investment avenues available today in the financial market for
an investor with an invest able surplus. Customer can invest in bank deposits,
corporate debentures and bonds where there is low risk but low return.
Customers have one more option that is mutual funds where the risk is high as
well as returns are high
 Mutual fund brings the benefits of diversification and money
management to the individual investor, providing an opportunity for
financial success that was once available only to select few
 Mutual fund makes it easy and less costly for investors to satisfy their
needs for capital growth, income and or income preservation
 Where the inflation rates are between 5.5 to 6 with the fixed deposits and
recurring deposits we cannot beat inflation directly, but in the mutual
fund the returns are tax free and we can beat the inflation

The project will include:

 To find out the necessary facts regarding investor‟s opinion and
perception and to build awareness consumer benefit of mutual fund.
 To compare the different factors with demographic factors such as age,
occupation & gross annual income of the respondents to analyze
awareness of investment opportunities in mutual fund
 To achieve the target of 40 applicants per month in a segmented area

 As there are many schemes and we are focusing mainly on 7 schemes and
produce awareness of that schemes and make the customer to invest

A) Reliance top 200 fund

B) Reliance vision fund
C) Reliance growth fund
D) Reliance mid & small cap fund
E) Reliance small cap fund

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 F) Reliance tax saver (ELLS) fund
G) Reliance balance (equity/debt) fund

 handling key customers as assigned by company guide

To find out the new clients or new opportunities for company sales

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INTRODUCTION

Company profile:

Reliance Nippon Life Asset Management - RNAM (formerly Reliance

Capital Asset Management Limited) is one of the largest asset manager in
India and manages and advises Rs. 3,58,059 crore (US$ 55.1 billion) as
per March, 2017, across mutual funds, pension funds, managed accounts,
alternative investments and offshore funds. RNAM is the only AMC to
have the mandate for fund management by EPFO, PFRDA and CMPFO.
RNAM is the asset manager of Reliance Mutual Fund (RMF) Schemes.
Mr. SundeepSikka is the Executive Director & Chief Executive Officer of
RNAM.
As per Mar‟17, RMF manages the highest assets from „beyond Top 15
cities‟ category across all AMCs in the Industry.
RNAM acts as the advisor for India focused Equity and Fixed Income
funds in Japan (launched by Nissay Asset Management) and Korea
(Samsung Asset Management). RNAM also manages offshore funds
through its subsidiaries in Singapore and Mauritius thereby catering to
investors across Asia, Middle East, UK, US, and Europe.

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VISION AND MISSION STATEMENT of reliance nippon life asset management ltd:

VISION STATEMENT:
To be a globally respected wealth creator with an emphasis on customer care
and a culture of good corporate governance.
MISSION STATEMENT
To create and nurture a world-class, high performance environment aimed at
delighting our customers.

Industry profile:
SCHEMES
To make their packages more attractive, reliance mutual fund offered many
schemes called the equity/growth schemes, debt/income schemes and sector
specific scheme
Schemes under reliance Mutual fund:
By structure
 Open ended schemes
 Close ended schemes
 Interval schemes

By investment objective
 Growth schemes
 Dividend schemes
 Dividend payout schemes
 Balanced schemes
 Tax saving schemes
 Sector specific schemes

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ECONOMIC, INDUSTRY AND COMPANY ANALYSIS: (EIC ANALYSIS)

Overview of Economy:

India's diverse economy encompasses traditional village farming, modern

agriculture, handicrafts, a wide range of modern industries, and a multitude of
services. Slightly less than half of the workforce is in agriculture, but services
are the major source of economic growth, accounting for nearly two-thirds of
India's output but employing less than one-third of its labor force. India has
capitalized on its large educated English-speaking population to become a major
exporter of information technology services, business outsourcing services, and
software workers. Nevertheless, per capita income remains below the world
average.

India is developing into an open-market economy, yet traces of its past autarkic
policies remain. Economic liberalization measures, including industrial
deregulation, privatization of state-owned enterprises, and reduced controls on
foreign trade and investment, began in the early 1990s and served to accelerate
the country's growth, which averaged nearly 7% per year from 1997 to 2017.
India's economic growth slowed in 2011 because of a decline in investment
caused by high interest rates, rising inflation, and investor pessimism about the
government's commitment to further economic reforms and about slow world
growth. Rising macroeconomic imbalances in India and improving economic
conditions in Western countries led investors to shift capital away from India,
prompting a sharp depreciation of the rupee through 2016.

Growth rebounded in 2014 through 2016, exceeding 7% each year, but slowed
in 2017. Investors‟ perceptions of India improved in early 2014, due to a
reduction of the current account deficit and expectations of post-election
economic reform, resulting in a surge of inbound capital flows and stabilization
of the rupee. Since the election, the government has passed an important goods
and services tax bill and raised foreign direct investment caps in some sectors,
but most economic reforms have focused on administrative and governance
changes largely because the ruling party remains a minority in India‟s upper
house of Parliament, which must approve most bills. Despite a high growth rate
compared to the rest of the world, India‟s government-owned banks faced
mounting bad debt in 2015 and 2016, resulting in low credit growth and
restrained economic growth.

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GDP annual growth rate

Recent news about economic growth:

Growth accelerated in the quarter ended December to 7.2%, the government

said Wednesday. That's faster than China's growth over the same period, and a
big jump from the 6.5% India recorded the previous quarter.
The latest GDP numbers point to a clear strengthening of India's recovery from
a sharp slump in the first half of 2017, when growth fell from 7% to a three-year
low of 5.7% after two disruptive policy changes by Prime Minister
NarendraModi.
The country was stunned in November 2016 when Modi abruptly banned its
two largest currency notes, leading to a sharp slump in many sectors of India's
cash economy. A landmark overhaul of the tax system in July last year also
disrupted business, as many companies struggled to adapt to the new regime.
India is expected to further widen the gap over China in 2018, with the
International Monetary Fund predicting last month that it will grow by 7.4%
this year.

Different sectors of Indian economy

Infrastructure sector:
Infrastructure sector is a key driver for the Indian economy. The sector is highly
responsible for propelling India‟s overall development and enjoys intense focus
from Government for initiating policies that would ensure time-bound creation
of world class infrastructure in the country. Infrastructure sector includes power,
bridges, dams, roads and urban infrastructure development. In 2016, India
jumped 19 places in World Bank's Logistics Performance Index (LPI) 2016, to
rank 35th amongst 160 countries.

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India has a requirement of investment worth Rs 50 trillion (US$ 777.73 billion)
in infrastructure by 2022 to have sustainable development in the country. India
is witnessing significant interest from international investors in the
infrastructure space. Some key investments in the sector are listed below.

 In February 2018, the Government of India signed a loan agreement

worth US$ 345 million with the New Development Bank (NDB) for the
Rajasthan Water Sector Restructuring Project for desert areas.
 In January 2018, the National Investment and Infrastructure Fund (NIIF)
partnered with UAE-based DP World to create a platform that will
mobilise investments worth US$ 3 billion into ports, terminals,
transportation, and logistics businesses in India.

Manufacturing sector:
With the help of Make in India drive, India is on the path of becoming the hub
for hi-tech manufacturing as global giants such as GE, Siemens, HTC, Toshiba,
and Boeing have either set up or are in process of setting up manufacturing
plants in India, attracted by India's market of more than a billion consumers and
increasing purchasing power.
Cumulative Foreign Direct Investment (FDI) in India‟s manufacturing sector
reached US$ 73.70 billion during April 2000-December 2017.
India has become one of the most attractive destinations for investments in the
manufacturing sector. Some of the major investments and developments in this
sector in the recent past are:

 Mahindra and Mahindra is planning to start operating a fleet of electric

cabs and supplying parts to Electric Vehicle (EV) manufacturers.
 Grasim Industries has received clearance for expansion of its plant at
Vilayat. The expansion will entail an investment of Rs 2,560 crore (US$
396.8 million)
 Over 350 mobile charger factories are expected to be set up in India by
2025, on the back of the government‟s push to encourage production of
battery chargers. Setting up of these factories is expected to lead to
production of 1.46 billion chargers and generation of 0.8 million jobs.

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  Government of India is planning to invite bids for setting up of 20
Gigawatts (GW) of solar power capacity with the objective of boosting
domestic manufacturing of solar power equipment.
 JSW Energy has signed a memorandum of understanding (MoU) with the
Government of Gujarat, for setting up an electric vehicle (EV)
manufacturing unit in Gujarat at an estimated cost of Rs 4,000 crore (US$
608.88 million).
 With an aim to increase its presence in India, Denmark-based heating
ventilation and air-conditioning (HVAC) giant, Danfoss, is planning to
take its manufacturing localisation to 50 per cent as well as double its
supplier base in India by 2020.

Tourism
Tourism in India is economically important and is growing rapidly. The World
Travel & Tourism Council calculated that tourism generated ₹15.24 lakh
crore (US$230 billion) or 9.4% of the nation's GDP in 2017 and
supported 41.622 million jobs, 8% of its total employment. The sector is
predicted to grow at an annual rate of 6.9% to ₹32.05 lakh
crore (US$490 billion) by 2028 (9.9% of GDP). In October 2015, India's
medical tourism sector was estimated to be worth US$3 billion. It is projected to
grow to $7–8 billion by 2020. In 2014, 184,298 foreign patients traveled to
India to seek medical treatment.

Real Estate Sector

The Indian real estate sector has witnessed high growth in recent times with the
rise in demand for office as well as residential spaces. Private equity
investments in real estate are estimated to grow to US$ 100 billion by 2026 with
tier 1 and 2 cities being the prime beneficiaries. India stood third in the US
Green Building Council's (USGBC) ranking of the top 10 countries for
Leadership in Energy and Environmental Design (LEED) certified buildings,
with over 752 LEED-certified projects across 20.28 million gross square meters
of space. According to data released by Department of Industrial Policy and
Promotion (DIPP), the construction development sector in India has received
Foreign Direct Investment (FDI) equity inflows to the tune of US$ 24.67 billion
in the period April 2000-December 2017.
Some of the major investments in this sector are as follows:

 In February 2018, DLF bought 11.76 acres of land for Rs 15 billion (US$
231.7 million) for its expansion in Gurugram, Haryana.

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  In February 2018, Japanese conglomerate Sumitomo Corporation
announced its US$ 2 billion partnership with Krishna Group to develop
real estate projects in the country.
 KKR India Asset Finance Pvt Ltd has invested over US$ 500 million in
residential real estate projects in India in 2017, taking its total
investments in real estate projects in India to US$ 1 billion.

Agriculture sector:
 Gross Value Added by agriculture, forestry and fishing is estimated at Rs 17.67
trillion (US$ 274.23 billion) in FY18*.
 Agriculture and allied sector‟s GVA at constant 2011-12 prices grew a CAGR
of 2.75 per cent between FY12-18.
 Agriculture is the primary source of livelihood for about 58 per cent of India‟s
population.
 As per Union Budget 2018-19, allocation of Rs 57,600 crore (US$ 8.9 billion)
was made for The Agriculture Ministry.
 As per Union Budget 2018-19, the farm credit is likely to be raised to INR 11
lakh crore (US$ 170.74 billion)
 Cotton production in India is expected to increase 9.3 per cent to 37.7 million
bales in 2017-18.

Service sector:
The services sector is not only the dominant sector in India‟s GDP, but has also
attracted significant foreign investment flows, contributed significantly to
exports as well as provided large-scale employment. India‟s services sector
covers a wide variety of activities such as trade, hotel and restaurants, transport,
storage and communication, financing, insurance, real estate, business services,
community, social and personal services, and services associated with
construction.

Retail and wholesale trade:

As one of the leading service providers to the Indian retail industry, EY offers
existing and new retailers an array of risk, tax, advisory and transaction
services. We have been associated with the industry since its early growth phase
in India and have worked with players across categories, formats and scale of

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operations. Our knowledge and experience acquired from our industry focus can
help you address your most complex business challenges.

Banking and insurance:

The banking sector in India has the advantage of access to one of the largest and
most stable global financial networks. It has been strengthened by a series of
financial and regulatory reforms implemented recently, such as flexibility in
lending rates, gradual dilution of government holdings in public-sector banks,
and the easing of restrictions on private-sector and international banks. As the
Indian economy is poised for a faster growth rate, its financial sector dominated
by both insurance and banking companies looks attractive for long-term
investment. Indian banks and insurance companies can take advantage of the
growing domestic market while aspiring for global competitiveness.

IT Industry
The global sourcing market in India continues to grow at a higher pace
compared to the IT-BPM industry. The global IT &ITeS market (excluding
hardware) reached US$ 1.2 trillion in 2016-17, while the global sourcing market
increased by 1.7 times to reach US$ 173-178 billion. India remained the world‟s
top sourcing destination in 2016-17 with a share of 55 per cent. Indian IT
&ITeS companies have set up over 1,000 global delivery centres in over 200
cities around the world.

TransportationIndustry:
The Indian transportation industry is continually growing at a CAGR of 15
percent. With over seven million goods vehicles moving around the country, the
freight volume has reached 1,325 billion ton-km, a figure that is supposed to
double by 2025. We spend almost 14 percent of our GDP on transportation and
logistics, whereas in developed countries the spend is around 6-8 percent.
However, the industry remains heavily fragmented, unorganized and very rough
in nature. In order to gain a better understanding of the issues, we must
understand the day-to-day operations in the industry and its key stakeholders.

Capital goods & engineering sector:

The Indian engineering sector is divided into two major segments - heavy
engineering and light engineering. The capital goods and engineering turnover
in India is expected to have reached US$ 125.4 billion by FY 2016-17.
Likewise, Electrical equipment market size is expected to reach US$ 100 billion
by FY 2021-22. Comparative advantage vis-à-vis peers in terms of
manufacturing costs, market knowledge, technology and creativity has been a
driving force for engineering exports from India. Engineering exports from

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 India grew 16.81 per cent to US$ 76,204.38 million in FY18 from US$
65,239.19 million in FY17.

Chemical Industry:
India's chemical sector is expected to double its size at USD 300 billion by
2025, clocking an annual growth rate of 8-10 per cent per, the government said
today.
To meet this objective, the Centre also announced plans to bring a new policy to
promote the domestic industry and curb imports.

PEST ANALYSIS OF MUTUAL FUNDS

POLITICAL ANALYSIS
• In India, SEBI (Mutual Fund) Regulations, 1996 regulates the structure of
Mutual Funds.
• Mutual funds in India are constituted in the form of a Public Trust created under
The Indian Trusts Act, 1882
• The stability of the government and people faith into it acts as an important
return factor.
• The impact of foreign investment.
• Forced renegotiation of contract.
• A requirement that a minimum percentage of supervisory positions be held by
locals.

ECONOMIC ANALYSIS
• India's population is young, with 54% under the age of 25 and 80% under 45 and
the percentage of working population is rising rapidly.
• If we see the position of BSE Sensex as compared to other major indexes in the
world then we find that BSE has been the best performer.
• India – Potential 'Services Capital' of the World-With services becoming
increasingly tradable, India is well placed in terms of costs and skill sets and
over the past 13 years.
• Inflation affects the Return-Inflation has always lowered the actual return from
bank savings except the year 2002.

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• Impact of Various Changes-With the increase in global trade and finance, there
is a need for level playing field as the WTO has laid down common rules to
facilitate smooth trade among member countries irrespective of their size.

SOCIO-CULTRAL ANALYSIS
 The most important factor shaping in today's global economy is the process of
globalization.
 The increasing share of India and other emerging market economies in world
trade.
 To fund future needs, to meet contingencies, to maintain same standard of living
after retirement.
 Standard of living of population tends to improve.

TECHNOLOGICAL ANALYSIS
 Indian companies are moving in search of low-cost markets, technology is
driving growth in production and competition is becoming more intense.
 The outburst in communication technology has led to greater integration of
Indian financial markets across the world.
 The outburst of technology has made it possible for the foreign companies to
look for Indian market and returns associated with it.

INDUSTRY ANALYSIS

About mutual funds

The first introduction of a mutual fund in India occurred in 1963, when
the Government of India launched Unit Trust of India (UTI). UTI enjoyed a
monopoly in the Indian mutual fund market until 1987, when a host of other
government-controlled Indian financial companies established their own funds,
including State Bank of India, Canara Bank and by Punjab National Bank.
More than 50 years have gone by since UTI started its first sale in July 1964,
and we believe that in the next few years, the industry will perform closer to the

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original mandate of encouraging and mobilizing savings of small investors. The
confluence of emerging technology and enabling regulation will facilitate the
industry to broaden and deepen its reach amongst retail investors. • Evaluation
of e-commerce platforms to sell mutual funds is currently underway, and a
positive outcome will help unlock the buying power of the 400 mn Internet
users and 1 bn mobile phone users in India; • Financial inclusion has received a
fillip with the JAM number trinity (Jan Dhan, Aadhar& Mobile), and opening of
192 mn Jan Dhan accounts in 15 months with a deposit base of Rs 27,000 crore.
This builds the case forevaluating adoption of a similar model and cross-selling
opportunities; • More clarity on E-KYC and its subsequent adoption will aid the
penetration amongst the hitherto un-served segment; • the recently approved
payment banks, with permission to sell third-party mutual fund products are
expected to improve the reach.

What is a Mutual Fund?

A mutual fund is a professionally-managed trust that pools the savings of many

investors and invests them in securities like stocks, bonds, short-term money
market instruments and commodities such as precious metals. Investors in a
mutual fund have a common financial goal and their money is invested in
different asset classes in accordance with the fund‟s investment objective.
Investments in mutual funds entail comparatively small amounts, giving retail
investors the advantage of having finance professionals control their money
even if it is a few thousand rupees.
Mutual funds are pooled investment vehicles actively managed either by
professional fund managers or passively tracked by an index or industry. The
funds are generally well diversified to offset potential losses. They offer an
attractive way for savings to be managed in a passive manner without paying
high fees or requiring constant attention from individual investors. Mutual funds
present an option for investors who lack the time or knowledge to make
traditional and complex investment decisions. By putting your money in a
mutual fund, you permit the portfolio manager to make those essential decisions
for you.

History of industry

The mutual fund industry in India started in 1963 with the formation of Unit
Trust of India (UTI) at the initiative of the Reserve Bank of India (RBI) and the
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Government of India. The objective then was to attract small investors and
introduce them to market investments. Since then, the history of mutual funds in
India can be broadly divided into six distinct phases.

Phase I (1964-87): Growth of UTI

In 1963, UTI was established by an Act of Parliament. As it was the only entity
offering mutual funds in India, it had a monopoly. Operationally, UTI was set
up by the Reserve Bank of India (RBI), but was later delinked from the RBI.
The first scheme, and for long one of the largest launched by UTI, was Unit
Scheme 1964.Later in the 1970s and 80s, UTI started innovating and offering
different schemes to suit the needs of different classes of investors. Unit Linked
Insurance Plan (ULIP) was launched in 1971. The first Indian offshore fund,
India Fund was launched in August 1986. In absolute terms, the investible funds
corpus of UTI was about Rs 600 crores in 1984. By 1987-88, the assets under
management (AUM) of UTI had grown 10 times to Rs 6,700 crores.
Phase II (1987-93): Entry of Public Sector Funds

The year 1987 marked the entry of other public sector mutual funds. With the
opening up of the economy, many public sector banks and institutions were
allowed to establish mutual funds. The State Bank of India established the first
non-UTI Mutual Fund, SBI Mutual Fund in November 1987. This was followed
by Can-bank Mutual Fund,LIC Mutual Fund, Indian Bank Mutual Fund, Bank of
India Mutual Fund, GIC Mutual Fund and PNB Mutual Fund. From 1987-88 to
1992-93, the AUM increased from Rs 6,700 crores to Rs 47,004 crores, nearly
seven times.

Phase III (1993-96): Emergence of Private Funds

A new era in the mutual fund industry began in 1993 with the permission granted
for the entry of private sector funds. This gave the Indian investors a broader

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choice of 'fund families' and increasing competition to the existing public sector
funds. Quite significantly foreign fund management companies were also
allowed to operate mutual funds, most of them coming into India through their
joint ventures with Indian promoters.
The private funds have brought in with them latest product innovations,
investment management techniques and investor-servicing technologies. During
the year 1993-94, five private sector fund houses launched their schemes
followed by six others in 1994-95.

Phase IV (1996-99): Growth and SEBI Regulation

Since 1996, the mutual fund industry scaled newer heights in terms of
mobilization of funds and number of players. Deregulation and liberalization of
the Indian economy had introduced competition and provided impetus to the
growth of the industry. Erstwhile UTI voluntarily adopted SEBI guidelines for
its new schemes. Similarly, the budget of the Union government in 1999 took a
big step in exempting all mutual fund dividends from income tax in the hands of
the investors. During this phase, both SEBI and Association of Mutual Funds of
India (AMFI) launched Investor Awareness Programme aimed at educating the
investors about investing through MFs.

Phase V (1999-2004): Emergence of a Large and Uniform Industry

The year 1999 marked the beginning of a new phase in the history of the mutual
fund industry in India, a phase of significant growth in terms of both amount
mobilised from investors and assets under management. In February 2003, the
UTI Act was repealed.

UTI Mutual Fund is the present name of the erstwhile Unit Trust of India (UTI).
While UTI functioned under a separate law of the Indian Parliament earlier, UTI
Mutual Fund is now under the SEBI's (Mutual Funds) Regulations, 1996 like all
other mutual funds in India.
The emergence of a uniform industry with the same structure, operations and
regulations make it easier for distributors and investors to deal with any fund
21
house. Between 1999 and 2005 the size of the industry has doubled in terms of
AUM which have gone from above Rs 68,000 crores to over Rs 1,50,000crores.

Phase VI (From 2004 Onwards): Consolidation and Growth

The industry has lately witnessed a spate of mergers and acquisitions,

most recent ones being the acquisition of schemes of Allianz Mutual Fund by
Birla Sun Life, PNB Mutual Fund by Principal, among others. At the same time,
more international players continue to enter India including Fidelity, one of the
largest funds in the world.
How mutual fund works??

Why should invest mutual funds??

Mutual funds allow investors to pool in their money for a diversified
selection of securities, managed by a professional fund manager. It offers an
array of innovative products like fund of funds, exchange-traded funds, Fixed
Maturity Plans, Sectoral Funds and many more.
Whether the objective is financial gains or convenience, mutual funds offer
many benefits to its investors.

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MANAGE INFLATION

Mutual Funds help investors generate better inflation-adjusted returns, without

spending a lot of time and energy on it. While most people consider letting their
savings 'grow' in a bank, they don't consider that inflation may be nibbling away
its value.

Suppose you have Rs. 100 as savings in your bank today. These can buy
about 10 bottles of water. Your bank offers 5% interest per annum, so by next
year you will have Rs. 105 in your bank. However, inflation that year rose by
10%. Therefore, one bottle of water costs Rs. 11. By the end of the year, with Rs.
105, you will not be able to afford 10 bottles of water anymore.
Mutual Funds provide an ideal investment option to place your savings for a
long-term inflation adjusted growth, so that the purchasing power of your hard
earned money does not plummet over the years.

EXPERTISE
Backed by a dedicated research team, investors are provided with the services
of an experienced fund manager who handles the financial decisions based on
the performance and prospects available in the market to achieve the objectives
of the mutual fund scheme.

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CONVENIENCE

Mutual funds are an ideal investment option when you are looking at
convenience and timesaving opportunity. With low investment amount
alternatives, the ability to buy or sell them on any business day and a multitude
of choices based on an individual's goal and investment need, investors are free
to pursue their course of life while their investments earn for them.

LOW COST

Probably the biggest advantage for any investor is the low cost of investment
that mutual funds offer, as compared to investing directly in capital markets.
Most stock options require significant capital, which may not be possible for
young investors who are just starting out.

Mutual funds, on the other hand, are relatively less expensive. The benefit of
scale in brokerage and fees translates to lower costs for investors. One can start
with as low as Rs. 500 and get the advantage of long term equity investment.

DIVERSIFICATION

Going by the adage, 'Do not put all your eggs in one basket', mutual
funds help mitigate risks to a large extent by distributing your investment across
a diverse range of assets. Mutual funds offer a great investment opportunity to
investors who have a limited investment capital.

LIQUIDITY

Investors have the advantage of getting their money back promptly, in case
of open-ended schemes based on the Net Asset Value (NAV) at that time. In
case your investment is close-ended, it can be traded in the stock exchange, as
offered by some schemes.

HIGHER RETURN POTENTIAL

Based on medium or long-term investment, mutual funds have the

potential to generate a higher return, as you can invest on a diverse range of
sectors and industries

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 Advantages of investing in mutual fund

 Affordability:An investor can buy in to a portfolio of equities, which would

otherwise be extremely expensive. Depending upon the investment objective of
the scheme mutual fund invests in the portfolio of the assets, that is bonds, shares
etc

 Diversity:They spread their investment in different securities such as stocks,

bonds, money market instruments, real estate, fixed deposit etcand different
sectors (auto, textile, information technology etc.).
 Regulations: Securities Exchange Board of India (“SEBI”), the mutual funds
regulator has clearly defined rules, which govern mutual funds. These rules
relate to the formation, administration and management of mutual funds and also
prescribe disclosure and accounting requirements. Such a high level of
regulation seeks to protect the interest of investors.

 Variety:As you grow your portfolio of mutual funds, you will want to diversify
into various mutual fund categories and types. You can invest in mutual funds
that cover the main asset classes (stocks, bonds, cash) and various sub-categories
or you can even venture into specialized areas, such as sector funds or precious
metals funds.

 Liquidity: Another advantage of mutual funds is the ability to get in and

out with relative ease. In general, you are able to sell your mutual funds in a
short period of time without there being much difference between the sale price
and the most current market value. However, it is important to watch out for any
fees associated with selling, including back-end load fees. Also, unlike stocks
and exchange-traded funds (ETFs), which trade any time during market hours,
mutual funds transact only once per day after the fund's performance of net asset
value is calculated(NAV).

 Flexibility:All of the above benefits of mutual funds overlap into simplicity and
flexibility. You can invest in just one fund or invest in a wide variety. Automatic
deposit, systematic withdrawal, 401(k) plans, annuity sub-accounts, dividends,
short-term savings, long-term savings, and nearly limitless investment strategies

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 make mutual funds the best overall investment type for both beginners and
advanced investors.

 Frugality: Costs as a percentage of assets in the portfolio are usually lower for
an actively-managed mutual fund when compared to an actively-managed
portfolio of individual securities.

COMPANY ANALYSIS

BACKGROUND
Reliance Mutual Fund (RMF) is one of India's leading mutual funds, with
Average Assets Under Management (AAUM) of ` 2,44,903.56 Crores (January
2018 - March 2018 Quarter Q4) and 81.7243 lakhs folios (as on 31st March,
2018). To know more details about the AUM, please click here.
Reliance Mutual Fund, a part of the Reliance Anil DhirubhaiAmbani (ADA)
Group, is one of the fastest growing mutual funds in India. RMF offers
investors a well-rounded portfolio of products to meet varying investor
requirements and has presence in 160 cities across the country. RMF constantly
endeavours to launch innovative products and customer service initiatives to
increase value to investors.
DIFFERENT TYPES OF MUTUAL FUND OFFERED BY RELIANCE
MUTUAL FUND

Equity/Growth Schemes

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. These schemes provide
different options to the investors like dividend option, capital appreciation, etc.
and the investors may choose an option depending on their preferences. The
investors must indicate the option in the application form. The mutual funds
also allow the investors to change the options at a later date. Growth schemes
are good for investors having a long-term outlook seeking appreciation over a
period of time.

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Debt/Income Schemes

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 schemes. These funds are not
affected because of fluctuations in equity markets. However, opportunities of
capital appreciation are also limited in such funds. The NAVs of such funds are
affected because of change in interest rates in the country. If the interest rates
fall, NAVs of such funds are likely to increase in the short run and vice versa.
However, long term investors may not bother about these fluctuations.

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. Investors need to keep a watch on the
performance of those sectors/industries and must exit at an appropriate time.
They may also seek advice of an expert.

Exchange Traded Fund

Exchange Traded Funds (ETFs) are usually passively managed mutual fund
schemes tracking a benchmark index and reflect the performance of that index.
These schemes are listed on the stock exchange and therefore have the
flexibility of trading like a share on the stock exchange. It can also be looked as
a security that tracks an index, a commodity or a basket of assets like an index
fund, but trades like a stock on an exchange, thus experiencing price changes
throughout the day as it is bought and sold.

Fixed Maturity Plans (FMPs)

Fixed Maturity Plans (FMPs) are basically debt oriented investment schemes
with a pre-specified tenure offered by mutual funds. FMPs invest in a portfolio
of debt instruments whose maturity coincides with the maturity of the
concerned FMP. The primary objective of a FMP is to generate income while
aiming to protect the capital by investing in a portfolio of debt and money
market securities. Since FMPs are available with several maturity options, one

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can invest in the relevant plan depending upon his investment horizon and the
requirement of cash flows.

Important Products Which Reliance Mutual Fund Offers

Reliance Growth Fund (An Open-ended Equity Growth Scheme): The primary
investment objective of the scheme is to achieve long term growth of capital by
investing in equity and equity related securities through a research based
investment approach.
Reliance Vision Fund (An Open-ended Equity Growth Scheme): The primary
investment objective of the scheme is to achieve long-term growth of capital by
investment in equity and equity related securities through a research based
investment approach
Reliance Equity Opportunities Fund (An Open-ended Diversified Equity
Scheme): The primary investment objective of the scheme is to seek to generate
capital appreciation & provide long-term growth opportunities by investing in a
portfolio constituted of equity securities & equity related securities and the
secondary objective is to generate consistent returns by investing in debt and
money market securities.
Reliance Quant Plus Fund (An Open-ended Equity Scheme): The investment
objective of the Scheme is to generate capital appreciation through investment
in equity and equity related instruments. The Scheme will seek to generate
capital appreciation by investing in an active portfolio of stocks selected from S
& P CNX Nifty on the basis of a mathematical model.
Reliance NRI Equity Fund (An Open-ended Diversified Equity Scheme): The
primary investment objective of the scheme is to generate optimal returns by
investing in equity and equity related instruments primarily drawn from the
Companies in the BSE 200 Index.
Reliance Tax Saver (ELSS) Fund (An Open-ended Equity Linked Savings
Scheme): The primary objective of the scheme is to generate long-term capital
appreciation from a portfolio that is invested predominantly in equity and equity
related instruments.
Reliance Regular Savings Fund (An open ended Scheme) Equity
Option: The primary investment objective of this Option is to seek capital
appreciation and/or to generate consistent returns by actively investing in equity
/ equity related securities.
Reliance Regular Savings Fund (An open ended Scheme) Balanced Option: The
primary investment objective of this Option is to generate consistent return and
appreciation of capital by investing in mix of securities comprising of Equity,
Equity related Instruments & Fixed income instruments.
Reliance Equity Fund (An open-ended Diversified Equity Scheme): The
primary investment objective of the scheme is to seek to generate capital

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appreciation & provide long-term growth opportunities by investing in a
portfolio constituted of equity & equity related securities of top 100 companies
by market capitalization & of companies which are available in the derivatives
segment from time to time and the secondary objective is to generate consistent
returns by investing in debt and money market securities.
Reliance Equity Advantage Fund (An Open ended Diversified Equity
Scheme): The primary investment objective of the scheme is to seek to generate
capital appreciation & provide long-term growth opportunities by investing in a
portfolio predominately of equity & equity related instruments with investments
generally in S & P CNX Nifty stocks and the secondary objective is to generate
consistent returns by investing in debt and money market securities.
Reliance Long Term Equity Fund (An open ended Diversified Equity
Scheme): The primary investment objective of the scheme is to seek to generate
long term capital appreciation & provide long-term growth opportunities by
investing in a portfolio constituted of equity & equity related securities and
Derivatives and the secondary objective is to generate consistent returns by
investing in debt and money market securities.
Reliance Equity Linked Saving Fund – Series I (A 10 year close-ended Equity
Linked Savings Scheme): The primary objective of the scheme is to generate
long-term capital appreciation from a portfolio that is invested predominantly in
equities along with income tax benefit.
Reliance Natural Resources Fund (An Open Ended Equity Scheme): The
primary investment objective of the scheme is to seek to generate capital
appreciation & provide long-term growth opportunities by investing in
companies principally engaged in the discovery, development, production, or
distribution of natural resources and the secondary objective is to generate
consistent returns by investing in debt and money market securities.
Reliance Infrastructure Fund (An open ended Equity Scheme): The primary
investment objective of the scheme is to generate long term capital appreciation
by investing predominantly in equity and equity related instruments of
companies engaged in infrastructure and infrastructure related sectors and
which are incorporated or have their area of primary activity, in India and the
secondary objective is to generate consistent returns by investing in debt and
money market securities.

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 SWOT ANALYSIS

SWOT Analysis is a useful technique for understanding the Strengths and

Weaknesses, and for identifying both the Opportunities opens to the organisation
and the Threats. A company has to identify its plus and minus in order to
overcome negative factors and penetrate the market using its positive factors. On
identifying the strengths and weakness, a company can come to a solution on
where it has got an opportunity and where it has a threat.

STRENGTH

 Brand strategy: as opposed to some of its competitors (e.g. HSBC), Reliance

ADAG operates a multi-brand strategy. The company operates under numerous
well-known brand names, which allows the company to appeal to many different
segments of the market.
 Distribution channel strategy: Reliance is continuously improving the
distribution of its products. Its online and Internet-based access offers a
combination of excellent growth prospects and its retail direct business also saw
growth of 27% in 2002 and 15% in 2003.
 Various sources of income: Reliance has many sources of income throughout
the group, and this diversity within the group makes the company more flexible
and resistant to economic and environmental changes.

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 Large pool of installed capacities.
 Experienced managersfor large number of Generics.
 Large pool of skilled and knowledgeable manpower.
 An increasing liberalization of government policies.

WEAKNESS
 Emerging markets: since there is more investment demand in the
United States, Japan and the rest of Asia, Reliance should concentrate
on these markets, especially in view of low global interest rates.

 Guaranteed Return: there is always the possibility that the value of

your mutual fund will depreciate. Unlike fixed-income products, such
as bonds and Treasury bills, mutual funds experience price
fluctuations along with the stocks that make up the fund. When
deciding on a particular fund to buy, you need to research the risks
involved – just because a professional manager is looking after the
fund, that doesn‟t mean the performance will be stellar.

 Fees: In mutual funds, the fees are classified into two categories:
shareholder fees and annual operating fees. The shareholder fees, in
the forms of loads and redemption fees are paid directly by
shareholders purchasing or selling the funds. The annual fund
operating fees are charged as an annual percentage – usually ranging
from 1-3%. These fees are assessed to mutual fund investors
regardless of the performance of the fund. As you can imagine, in
years when the fund doesn‟t make money, these fees only magnify
losses.

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 OPPURTUNITIES

 Online market:offers Reliance Mutual Fund the ability to greatly expand

their business, Reliance Mutual Funds can market to a much wider audience for
relatively little expense.

 New products: can help Reliance Mutual Funds to expand their business and
diversify their customer base.

 Great innovation: can help Reliance Mutual Fund to produce unique products
and services that meet customer‟s needs. For Eg- Reliance Mutual Fund Day on
7th of every month.

THREATS

 Mature Markets: are competitive. In order for Reliance Mutual Fund to grow
in a mature market, it has to increase the market share, which is difficult and
expensive.

 Bad economy: can hurt Reliance by decreasing the their customer base

 Intense competition: can lower their profits, as competition can entice

consumers away with superior products

COMPETITOR ANALYSIS

Competitor for the Reliance the performance of other mutual funds which is the
major competitor for reliance are:
 LARGE CAP CATEGORY

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 LARGE AND MID CAP CATEGORY
 MULTI CAP CATEGORY
 SECTOR SPECIFIC CATEGORY

LARGE CAP

These are the funds which invest major corpus into the companies with large
market capitalisation. There is no particular theory to decide as each fund house
apply its own research and analysis and categorise stock under different
categories. In general, companies with market capitalisation of Rs.1000 to 1500
crores or more are considered as large cap companies.

PERFORMANCE OF FUNDS IN LARGE CAP

Performance as of apr 30,2018
Large cap oriented fund

Corpus
Absolute returns Compounded annual
Scheme (Rs. Crs.)
name
2w 1 2 6 1 3 5 7 10 15
1wk
k mths mths mths year year year year year year
Axis equity
1.0 1.0 6.6 2.4 7.3 21.0 12.0 15.6 13.1 1850
fund
Edelweiss 1.7 2.5 7.5 -0.1 6.6 17.7 10.8 16.2 13.5 125
Invesco
1.0 0.8 4.9 -1.8 5.7 16.6 11.2 16.1 12.2 135
india
ICICI
0.5 1.0 5.0 -3.2 2.2 15.6 12.3 17.1 13.4 16102
prudential
Reliance
1.5 2.3 5.7 -4.5 2.8 15.4 11.7 18.4 13.8 11.4 8825
large cap
Kotak 50 1.0 1.3 5.0 -3.1 2.9 11.5 10.3 15.0 11.8 9.3 21.8 1326
HDFC
1.2 1.4 5.1 -6.9 -2.1 8.9 10.4 15.3 11.1 12.2 24.2 14350
TOP 200

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 LARGE AND MID CAP

A mid-cap fund is a type of investment fund that focuses its investments on companies
with a capitalization in the middle range of stocks in the investable market.
Companies with market capitalizations ranging from 200 to 300 crore are typically
considered mid-cap companies.

PERFORMANCE OF FUNDS
Large & mid cap fund
Absolute returns Compounded annualized

1 2 1 3 6 1 3 5 7 10 15 Corpus
Scheme name
wk wks mth mths mths year year year year year year (Rs.crs.)

Invesco India
growth
1.1 1.6 7.1 1.2 8.0 24.1 14.5 20 14.6 12.2 382
opportunities
fund
BOI AXA 1.7 1.6 7.4 -0.4 7.3 23.2 12.8 17 12.0 114
Edelweiss 1.2 1.9 6.6 0.6 7.9 21.9 13.1 18 13.1 10.3 260
L&T India
1266
special 1.7 2.4 8.2 0.3 5.9 18.3 14.6 20 15.6 13.3
situations Fund
Sundaram
Equity 1.4 2.0 6.9 0.5 7.0 17.8 15.2 20.4 13.0 10.1 337
multiplier fund
Reliance vision 0.8 0.9 4.2 -10.5 -6.2 11.1 8.3 16.5 10.7 9.6 22.1 3245
Kotak
opportunities 0.3 0.3 4.4 -3.0 -0.1 9.3 13.3 19.1 14.1 10.8 2356
fund
HDFC large cap
1.4 0.8 3.4 -6.8 -1.3 8.4 7.7 10.7 8.3 6.6 17.2 1225
fund

MULTI CAP

Multi-cap funds are diversified mutual funds that can invest in companies
across market capitalization. In other words, they are market capitalization
agnostic and invest across the breadth of the equity market.

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 PERFORMANCE OF FUNDS

Large & mid cap fund

Absolute returns Compounded annualized
Scheme name 1 2 1 3 6 1 3 5 7 10 15 Corpus
wk wks mth mths mths year year year year year year (Rs.crs.)
Kotak classic equity 0.8 1.9 6.8 1.3 6.2 21.3 12.9 16.4 13.5 11.2 297
UTI equity fund 2.0 3.0 8.5 4.5 12.1 20.6 12.0 17.6 14.0 13.0 22.1 4905
Principal multi cap
1.3 2.6 7.9 -2.0 3.1 19.9 17.6 22.3 16.5 10.2 20.2 629
fund
Paragparikh long 990
1.4 1.7 5.1 -2.8 3.9 17.8 12.3
term equity fund
Motilaloswalmulticap
1.3 0.9 4.5 0.7 4.9 16.5 19.1 337
35 fund
Reliance multi cap
0.6 1.9 5.4 -5.2 3.7 14.5 9.3 17.4 14.6 14.8 9551
fund
Franklin india prima
1.6 2.3 5.3 -2.7 3.4 12.1 11.5 19.5 14.9 13.1 24.0 11224
plus
DSP black rock 0.9 1.4 5.8 -1.9 3.7 13.2 13.2 18.4 12.6 12.2 2522

FINDINGS
1. In equity schemes fund there is reliance top 200 funds in which more people
is invest as it is large cap fund and give good return. Reliance top 200-12.22
2. As the most of people are not aware of much about mutual funds they don‟t
want to invest.
3. Selling the product is not easy as customer is not so much interest in it. If
bank staff will say to customer to buy then only they will buy the mutual funds.

CONCLUSION
 Most of the investors don‟t know about the mutual fund concepts itself so
they want some kind of advisory services from reliance.
 75% of the investors are totally unaware of these mutual funds
 Most of the investors want risk free investments
 Promotional activities such as posters, banners are rarely seen with
respect of Reliance Mutual funds

35
  Half of the respondents have a wrong perception regarding mutual funds.
They feel mutual funds are very risky investment alternative

REFERENCES
 http://www.moneycontrol.com/india/stockmarket/sector-
classification/marketstatistics/bse/automotive.html
 http://www.moneycontrol.com/mutual-funds/nav/reliance-top-200-fund-
retail-plan/MRC155
 https://en.wikipedia.org/wiki/Mutual_funds_in_India
 https://mutualfundindia.com/Images/Research/PdfPaths/4a9861211a1740
328205cd607cbc29e8MutualFundScreeners_Nov_2015_v1.pdf
 http://business.mapsoindia.com/
 https://www.ibef.org/

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