A RESEARCH PROJECT REPORT ON

INVESTMENT BEHAVIOURS OF INVESTOR TOWARDS SBI MUTUAL FUND

Submitted in partial fulfillment of the requirement for the award of degree of MASTER OF BUSINESS ADMINISTRATION BY
Sanjay Kumar Verma MBA 2007-2009 ICCMRT, LUCKNOW Roll No-0712470076

UNDER THE GUIDANCE OF

Dr. Rakesh Sharma ICCMRT

INSTITUTE OF CO-OPERATIVE AND CORPORATE MANAGEMENT, RESEARCH AND TRAINING

467, Sector-21, Ring Road, Indira Nagar, Lucknow-226016 Website: www.iccmrt.ac.in, Email: iccmrt@satyam.net.in

2009 ACKNOWLEDGEMENT
I express my acknowledgement with deep sense of gratitude for my project
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guide Dr.R.K.Sharma for his full support and effective guidance which have proved immensely helpful in my project. His constant inspiration and valuable time throughout the project development made it feasible and easy to carry out project in much better way. I would also like to thanks all my friends who constantly helped me throughout this project during development and testing. Despite of their busy schedule they patiently helped and gave valuable suggestions. I am highly thankful to them for making this project successful. It was a great learning experience. Last but not the least I acknowledge my deep sense of regards and respect for my Parents and God who was the main source of energy behind this project work.

Sanjay Kumar Verma

PREFACE
Mutual Fund is a trust that pools the savings, which are than invested in capital market instruments such as shares, debenture and other securities. It works in a different manner as compared to other savings organizations such as banks, national savings, post office, nonbanking financial company etc. As most if not all-capital market instrument have an element of risk, it is very essential that the investors have a clear understanding of how a mutual fund operates and what are its advantages as well as limitations. This understanding has to be created in the investors by the distributors, investors desk service centers and other sources those are engaged in the marketing of mutual fund products. In this project I am trying to focus the Comparison of SBI Taxgain Scheme with others Mutual Funds tax scheme. And trying to focus on the Performance. But before comparing this scheme of mutual funds I discuss the concept of mutual fund. Than I can compare the SBI Taxgain schemes with others mutual funds equity schemes. Then I conclude the results that SBI Taxgain scheme is benefited for the investors in the present market scenario.

DECLARATION
Myself SANJAY KUMAR VERMA student of M.B.A 4th semester (INSTITUTE OF CO-OPERATIVE AND CORPORATE , MANAGEMENT, RESEARCH AND TRAINING, LUCKNOW) worked on Research work and my topic is INVESTMENT BEHAVIOURS OF INVESTOR TOWARDS SBI MUTUAL FUND is my original work it has not previously been submitted at any institute.

DATE :-

Sanjay Kumar Verma

CONTENTS
1. INTRODUCTION. 2. IMPORTANCE OF THE STUDY 3. SCOPE 4. SCHEMES & ACTIVITIES OF MUTUAL FUNDS 5. OBJECTIVES OF THE STUDY

6. COMPANY PROFILE PRODUCT PROFILE 7. RESEARCH SECTION 8. FINDINGS AND ANALYSIS 9. INTERPRETATION/CONCLUSION 10. SUGGESTIONS AND RECOMMENDATIONS 11. LIMITATIONS. 12. ANNEXURE. QUESTIONNAIRE.

13. BIBLOGRAPHY.

Introduction

INTRODUCTION
Different investment avenues are available to investors. Mutual funds also offer good investment opportunities to the investors. Like all investments, they also carry certain risks. The investors should compare the risk and expected yields after adjustment of tax on various instruments while taking investment decisions. The investors may seek advice from experts and consultants including agents and distributors of mutual fund schemes while making investment decisions. A Mutual Fund is an investment tool that allows small investors access to a welldiversified portfolio of equities, bonds and other securities. Each shareholder participates in the gain or loss of the fund. Units are issued and can be redeemed as needed. The fund's Net Asset Value (NAV) is determined each day.

About The Industry

The Indian mutual fund industry is dominated by the Unit Trust of India, which has collected from more than 20 million investors. The UTI has many funds/schemes in all categories i.e. equity, balanced, income etc. with some being open-ended and some being close ended. UTI was floated by the financial institutions and is governed by a special act of Parliament. Most of the investors believe that the UTI is government owned and controlled. Which, while legally incorrect, is true for all practical purposes? The second largest category of mutual funds is the ones floated by nationalized banks. Canbank Mutual Fund floated by Canara Bank and SBI Mutual Fund floated by the State Bank of India are the largest of these. The aggregate Corpus of assets managed by this category of AMCs is in excess of Rs 18,000 crores. The third largest category of mutual funds is the ones floated by the private sector and by foreign asset management companies. The largest of these are Prudential ICICI Mutual Fund and Birla Sun Life Mutual Fund. The aggregate Corpus of assets managed by this category of AMCs is in excess of Rs 250 bn.

Objective Of The study

Objective of the Study

To analyze the concept of the Mutual Fund. To study the Tax Saving Scheme of SBI Mutual Fund. To focus on the advantage and risk of Tax Saving Scheme of SBI Mutual Fund. To explore the new scope for Investors of Mutual Fund.

IMPORTANCE

This research plays an important role in finding the customer satisfaction level to access the performance of TAXGAIN Scheme of SBI Mutual Fund.

This research throws light upon the various aspects that investors/customers expect from the personnel of SBI Mutual Fund AMC at the Lucknow.

This research is also important in finding out the area where changes are to be made in regard of providing services to the existing investors of SBI Mutual Fund.

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SCOPE
The scope of this project report is to find out the customer/investors satisfaction level in regard to the return provided by the Magnum Taxgain Scheme to the investors and services being provided by the SBI mutual fund AMC office. Through this report research has tried to find out the different factors, which an investors expect from the personnel of SBI Mutual Fund AMC office. By this research the researcher will be able to explain what are the benefits of investing in Taxgain schemes of mutual fund and after sales services that prompt the people to come to SBI Mutual Fund, AMC office to quench their various queries. This research will help to know what is need to be done in regard to increase the level of customer satisfaction in regards to Taxgain scheme and to improve the performance of SBI Mutual Fund AMC office personnel, to cater the needs of SBI Mutual Fund investors.

Company Profile

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Profile of SBI Mutual fund

SBI Mutual Fund draws strength from India's premier and largest bank; the State Bank of India. Set up on July 1, 1955, the State Bank of India is the largest banking operation in the country. Through years of commitment to service and national development, SBI has grown into an instrument of social change. Today, it has 9,039 branches in India (excluding 4599 branches of banking subsidiaries) and 54 offices in 28 countries spread over all time zones. SBI entered into a Memorandum of Understanding with Socit Gnrale Asset Management (SGAM), which offers retail investors, corporate clients and institutional investors a wide range of investment products. SGAM is a dominant player in Global Mutual Fund arena with presence in over 20 countries spanning Europe, United Sates, and Asia, managing over 250 billion Euros in assets

CARPORATE PROFILE OF SBI MUTUAL FUND

Proven Skills in Wealth Generation.

SBI Mutual Fund is Indias largest bank sponsored mutual fund and has an enviable track record in judicious investments and consistent wealth creation. The fund traces its lineage to SBI - Indias largest banking enterprise. The institution has grown immensely since its inception and today it is India's largest bank, patronised by over 80% of the top corporate houses of the country. SBI Mutual Fund is a joint venture between the State Bank of India and Socit Gnrale Asset Management, one of the worlds leading fund management companies that manages over US$ 330 Billion worldwide.

Exploiting expertise, compounding growth

In eighteen years of operation, the fund has launched thirty-two schemes and successfully redeemed fifteen of them. In the process it has rewarded its investors handsomely with consistently high returns. A total of over 20,00,000 investors have reposed their faith in the wealth generation expertise of the Mutual Fund. Schemes of the Mutual fund have consistently outperformed benchmark indices and have emerged as the preferred investment for millions of investors and HNIs. Today, the fund manages over Rs. 13,000 crores of assets and has a diverse profile of investors actively parking their investments across 28 active schemes.

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The fund serves this vast family of investors by reaching out to them through network of 82 collection branches, 26 investor service centres, 21 investor service desks and 21 district organisers. SBI Mutual is the first bank-sponsored fund to launch an offshore fund Resurgent India Opportunities Fund . Growth through innovation and stable investment policies is the SBI MF credo.

Establishment Of SBI Mutual Fund

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Establishment of SBI Mutual Fund

SBI Mutual Fund has grown tremendously in terms of corpus as well as number of investors. Today we are one of the largest Bank sponsored Mutual Fund in the country. We have launched 35 Schemes, of which 15 have been redeemed, yielding handsome returns to investors. The fund has over Rs. 5,500 Crores as assets under management. We were also the first Bank sponsored Mutual Fund to launch an offshore fund, the India Magnum Fund, with a corpus of around Rs. 225 Crores. Today the Fund has an investor base of over 8 Lacs spread over 18 schemes. With a large network over 35 collection branches, 26 Investor Service Centres, 19 Investor Service Desks and 21 District Organizers, we constantly endeavor to get closer to our growing family of investors.

Plans of SBI Mutual Fund

SBI Mutual Fund launches many schemes of mutual funds. These schemes are Magnum FMCG Fund Magnum Pharma Fund Magnum Contra Fund Magnum IT Fund Magnum Equity Fund Magnum Balanced Fund Magnum Multiplier Plus Scheme Magnum Tax Gain Magnum Income fund Magnum Gilt Fund Magnum Insta Cash Fund Magnum Monthly Income Plan Magnum Index Fund Magnum Childrens Benefit Plan

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Competitors Of SBI Mutual Fund

Competitors of SBI Mutual Fund and scheme

There are many competitors of SBI Mutual Fund some Competitors are as follows1. Prudential ICICI Mutual Fund 2. Franklin Templeton Investment 3. HDFC Mutual Fund 4. Birla Sun Life Mutual Fund.

Prudential ICICI Mutual fund is the first major competitor of SBI mutual fund at national
level. They have launches many schemes in comparison of SBI mutual fund. These schemes are given below: PruICICI Power PruICICI Growth Plan PruICICI discovery Plan PruICICI Emerging S.T.A.R. Fund PruICICI Dynamic Plan PruICICI Tax Plan PruICICI FMGC Fund PruICICI Technology FUND PruICICI Index Fund

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PruICICI Balanced Fund PruICICI Child Care Plan - Gift PruICICI Child Care Plan - Study PruICICI Income Multiplier Fund PruICICI Monthly Income Plan PruICICI Blended Plan A PruICICI Blended Plan B PruICICI Flexible Plan PruICICI Long Term Plan

Franklin Templeton Investment is the second major competitor of SBI Mutual Fund at the
national or International level. They have launches many schemes in comparison of SBI mutual fund. These schemes are given below: Franklin India blue chip Fund Franklin India Prima Plus Templeton India Growth Fund Franklin India Prima Fund Franklin India Flexi cap Fund

Franklin India tax shield Franklin India Index Fund Franklin InfoTech Fund Franklin Pharma Fund Templeton India Income Fund Templeton Monthly Income plan FT India Monthly income Plan Templeton India Government Securities Fund Templeton Floating Rate Income Fund FT India Balanced Fund Templeton India Money Market Account Templeton India Treasury Management Account

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HDFC Mutual Fund is also the major competitor of SBI Mutual Fund. The main schemes of
HDFC mutual fund are as follows HDFC Growth Fund HDFC Equity Fund HDFC Index Fund HDFC Capital Builder Fund HDFC Multi-Cap Fund HDFC Multiple Yield Fund HDFC Income Fund HDFC High Interest Fund HDFC Gilt Fund HDFC Floating Rate Income Fund HDFC Balanced Fund HDFC Children s Gift Fund HDFC Long Term Advantage Fund HDFC Tax Saver HDFC Cash Management Fund

Birla Sun Life Mutual Fund is also the major competitor of SBI Mutual Fund. The main
schemes of HDFC mutual fund are as follows Birla Advantage Fund Birla Dividend Yield Plus Birla Asset Allocation Fund Birla Balance Birla MNC Fund Birla Index Fund Birla India Opportunities Fund Birla Midcap Fund Birla Equity Plan Birla Income Plus Birla Bond Plus Birla Bond Index Fund
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Birla Floating Rate Fund Birla Cash Plus Birla Gilt Plus

Mutual Fund An Introduction

INTRODUCTION OF MUTUAL FUND

Different investment avenues are available to investors. Mutual funds also offer good investment opportunities to the investors. Like all investments, they also carry certain risks. The investors

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should compare the risk and expected yields after adjustment of tax on various instrument while taking investment decisions. The investors may seek advice from experts and consultants including agents and distributors of mutual fund schemes while making investment decisions.

WHAT IS MUTUAL FUND

Mutual fund is a mechanism for pooling the resources by issuing units to the investors and investing funds in securities in accordance with objectives as disclosed in offer document. Investments in securities are spread across a wide cross-section of industries and sectors and thus

the risk is reduced. Diversification reduces the risk because all stock may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them, Investors of mutual fund are known as unit holders. The profit and losses are shared by the investors in the proportion to their investments. The mutual funds normally come out with a number of schemes with different investment objectives which are launched from time to time. A mutual fund is required to be registered with Securities and Exchange Board of India (SEBI) which regulates securities markets before it can collect funds from the public.

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Mutual Fund An Attractive Investment Option

Mutual Funds an Attractive Investment Option

Professional expertise Diversification of risk

Convenience Liquidity Transparent and well regulated Choice of schemes Choice of products One stop shop for investment avenues Tax Efficient returns

On the basis of Liquidity & Convenience

Payment for redemption with in 2-3 days Direct debt and Direct credit facility Convenience of operation Investment through ATMs, Internet Statement of account through e-mail, post in 3-4 days High level of service standards

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On the basis of Tax Efficient Returns

Tax Efficiency Dividends tax free in the hands of investors Capital gain tax benefits Indexation benefits Opportunity of double indexation benefit Sec.80 C benefit for ELSS investments

On the basis of Professional Expertise

Professional approach Funds managed by professionals with adequate qualification and experience In house research to aid the fund managers Top management involvement to guide the investment policy and the fund house philosophy Competitive performance resulting in constant improvement Portfolios and NAVs are disclosed at record timings Lower cost due to multiple choice for investors

On the basis of Transparency & Well Regulated

Transparency Every product is vetted by the regulator Three tier structure to ensure better accountability Trustees are responsible to the investors Regulatory policy determines the valuation, fairness, disclosure etc. Portfolios are disclosed on daily, weekly and monthly basis Lower costs due to multiple choice of investors Liquidity and convenience

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Role of SEBI in Mutual Fund Industry

History of Mutual Fund in India and role of SEBI in Mutual Funds industry
Unit Trust of India was the first mutual fund set up in India in the year 1963. In early 1990s, Government allowed public sectors bank and institutions to set up mutual funds. In the year 1992

Securities and Exchange Board of India Act was passed. The objectives of SEBI are to protect the interest of investors in securities and to promote the development of and to regulate the securities market. As far as mutual funds are concerned, SEBI formulates policies and regulates the mutual funds to protect the interest of the investors. SEBI notified regulations for the mutual funds in 1993. Thereafter, mutual funds sponsored by private sector entities were allowed to enter the capital market. The regulations were fully revised in 1996 and have been amended thereafter from time to time. SEBI has also issued guidelines to the mutual funds from time to time to protect the interests of investors. All mutual fund weather promoted by public sector or private sector entities including those promoted by foreign entities are governed by the same set of regulations. There is no distinction in regulatory requirements for these mutual funds and all are subject to monitoring and inspections by SEBI. The risks associated with the schemes launched by the mutual funds sponsored by these entities are of similar type. It may be mentioned here that Unit Trust of India (UTI) is not registered with SEBI as a mutual fund (as on January 15, 2002).

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SET UP OF MUTUAL FUND

How is a Mutual Fund set up

A mutual fund is set up in the form of trust, which has sponsor, trustees, Asset Management Company and custodian. The trust is established by a sponsor or more than one sponsor who is like to promoter of a company. The trustees of the mutual fund hold its property for the benefit

of the unit holders. Asset Management Company approved by SEBI manages the fund by making investment in the various types of securities. Custodians, who registered with SEBI, hold the securities of various schemes of the funds in its custody. The trustees are vested with the general power of superintendence and direction over AMC. They monitor the performance and compliance of SEBI Regulations by the mutual fund. SEBI Regulations require that at least two third of the directors of trustee company or board of trustees must be independent i.e. they should not be associated with the sponsor. Also, 50% of the directors of AMC must be independent. All mutual funds are required to be registered with SEBI before they launch any scheme. However, Unit Trust of India (UTI) is not registered with SEBI (as on January 15, 2002).

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TYPES OF MUTUAL FUND SCHEMES

TYPES OF MUTUAL FUND SCHEMES Mutual fund according to Maturity period:

A mutual fund scheme can be classified into open-ended scheme or close ended scheme depending on its maturity period.

Open-ended scheme
An open ended fund or scheme is one that is available for subscription and repurchase on a

continuous basis. These schemes do not have a fixed maturity period. Investors can conveniently buy and sell units at net asset value related prices which are de3cleared on a daily basis. The key feature of open-end schemes is liquidity.

Close-ended scheme
A close ended fund or scheme has a stipulated maturity period e.g. 5-7 years. The fund is open for subscription only during a specified period at the time of launch of the scheme. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where the units are listed. In order to provide an exit route to the investors, some close ended funds give an option of selling back the units to the mutual funds through periodic repurchase at NAV related prices, SEBI Regulations stipulate that at least one of the two exit routes to provided the investor i.e. either repurchase facility or through listing of stock exchanges. These mutual funds schemes disclose NAV generally on weekly basis.

Schemes according to Investment objective:

A scheme can also be classified as growth scheme, income scheme, or balanced scheme considering its investment objective. Such scheme may be open-ended or close-ended schemes as described earlier. Such schemes may be classified as follows:

Debt Funds Investment Objective :

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To invest in rated / unrated debt instruments of companies, government securities and also in the Money Market instruments.

Broad Classification
Income Funds Bond Funds Liquid Funds Government Securities Funds

Income Funds Investment Objective:

Debt Equity : 70 100% : 10 20%

Risk Return Profile

Low to Medium Risk

Dividend tax free in the hands of the investors

Ideal for all classes of investors

especially retired persons, housewives etc.

Bond Funds Investment Objective:

Debt and Money Market Equity : 100% : Nil%

Risk Return Profile

Low to Medium Risk

Common Features
Liquidity Interest Rate and Credit risk

Liquid Funds
Provides returns higher than banks and an ideal investment option Ideal for risk averse investors as a safe saving vechile

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Convenience of savings banks account fast liquidity No lock in period As a parking fund between financial transactions As a cash management account to earn returns at money market rates

Gilt Fund Investment Objective:

To invest fully in securities issued / guaranteed by Central and State Governments. Risk profile: Extremely low. Zero credit risk but there is interest rate risk Product between a Bond Fund and Liquid Fund Open ended and extremely liquid.

Equity Funds Investment Objective:

To invest primarily in equity and equity related instruments with the objective of capital appreciation in medium to long run.

Broad Classification:
Sector Funds Index Funds Balance Funds Equity Linked Savings Schemes (ELSS)

What is the Net Asset Value of Mutual Fund?

The performance of a particular scheme of a mutual fund is denoted by Net Asset Value (NAV).

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Mutual Fund invests the money collected from the investors insecurities markets. In simple words, Net Asset Value is the market value of the securities held by the scheme. Since market value of securities changed by every day, NAV of a scheme also varies on day to day basis. The NAV per unit is the market value of securities of a scheme dividend by the total number of units of the scheme on any particular date. For example, If the market value of securities of a mutual fund scheme is Rs 200 lacks and the mutual has issued 10 lacks unit of Rs 10 each to the investors, then than the NAV per unit of the fund is Rs 20. NAV is required to be disclosed by the mutual fund on a regular basis doily or weekly depending on the type of scheme.

Classification by Objective

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Classification by Objective
Income:
To provide regular Income at predetermined intervals. Periodicity varies from among monthly, quarterly, half yearly and annually Usually preferred by Retired People, Housewives, and all those who require a steady stream of income.

Growth:
Provide growth through Capital Appreciation. Income earned is ploughed back into the scheme and reflected as growth in the NAV. Growth schemes are usually equity oriented funds

Re-investment:
Income earned is re-invested back into the scheme. Fresh units are issued at the ex-income distribution sale price. Preferred by investors desirous of saving for long term needs.

How does one choose the right fund?

A few guidelines:

 Acquaint yourself with the fund manager's investment philosophy. Compare the returns he or she has geerated on fuds previously managed against funds with similar objectives. Both the experience of the fund manager and the results of the experience are important. Recognize the risk that emanates from an investment style. An investment philosophy and an investmetn style are distinct from one another. A philosophy has got to do the overall logic of picking stocks. That may not differ substantially, but an investment style can. For instance, within a given philosophy, one fund manager may believe in taking large concentrated bets on stocks, while another may prefer to diversify. The former is certainly a riskier style. Lastly, figure out whether the fund's investment objective and style suit your risk profile. The latter is a function of your investment time horizon, knowledge of capital markets, current net worth and future income, emotional makeup to accept losses and so on.

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How can the investors redress their complaints?

Investor would find the name of contact person in the offer document of the mutual fund scheme whom they may approach in case of any query, complaints or grievances. Trustees of a mutual fund monitor the activities of the mutual fund. The name of the directors of Asset Management Company and trustees are also given in the offer documents. Investors can also approach SEBI for redressal their complaints. On receipt of complaints, SEBI takes up the matters with the concerned mutual fund and follow up with them till the matter is resolved. Investors may send their complaints to: Securities and Exchange Board of India Mutual Funds Department Mittal Court B wing, First Floor, 224, Nariman Point 400021. Phone: 2850451-56, 2880962-70

Advantage of investing in a Mutual Fund

Investors can receive several advantages from investing in mutual funds these are given below:Professional Expertise -Fund managers in mutual funds are professionals who track the market
on a minute to minute basis. With the mix of professional qualification and market knowledge, they are better placed than the average investor to understand the markets.

Diversification -Since

a mutual fund scheme invest in a number of stocks or debentures, the

attendant risk are greatly reduced. Even if the stock price of one of the companies goes down or a company defaults on payment of interest, it does not result in a substantial loss to the investor as the other holding of the fund can compensate for this fall.

Relatively Inexpensive -When compared to direct investment in the capital market, mutual
fund cost less. This is due to savings in brokerage costs; demat costs, depository costs, etc.

Liquidity -Investments in mutual funds are completely liquid and can be redeemed at NAV related
prices on any working day. Since these are bought back by the mutual fund itself, there is no risk of not finding a buyer. Besides redemption money can be received by the investor with in a week.

Tax Benefits -Long term capital gains (period for more than 12 months) are taxed at rate of 20%
after factoring in cost inflation index or at a flat rate of 10%, without factoring in inflation.

SEBI Regulated - ALL mutual funds are registered with SEBI and function with in the provisions
and regulations that protect the interest of investors.

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Disadvantage of investing in a Mutual Fund

While the benefits of investing through mutual funds far outweigh the disadvantages, an investor and his adviser will do well to be aware of a few short comings of using the mutual funds as investment vehicles No control over costsAn investor in a mutual fund has no control over the overall cost of investing. He pays investment management fees as long as he remains with the fund, fees are usually payable as a percentage of the value of his investments, weather the fund value is rising or declining. A mutual fund investor also pays fund distribution costs, which he would no incur in direct investing. However, this shortcoming only means that there is a cost to obtain the benefit of mutual fund services. However, this cost is often less than the cost of direct investing by the investors.

No Tailor-made Portfolios- Investors who invest on their own portfolios of share, bonds, and
other securities. Investing through fund means he delegates this decision to the fund managers. The very high-net-worth individuals or large corporate investors may find this to be a constraint by offering objectives. However, mutual funds help investors overcome this constraint by offering families of schemes a large number of different schemes- within the same fund. An investor can choose from different investment plans and construct a portfolio of his choice.

Managing a Portfolio of Funds- Availability of a large number of funds can actually mean
too much choice for the investor. He may again need advice on how to select a fund to achieve his objectives, quite similar to the situation when he has to select individual shares or bonds to invest in.

PRODUCT PROFILE

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Open - ended Equity Linked Savings Scheme (ELSS)

Investment Objective
The prime objective of scheme is to deliver the benefit of investment in a portfolio of equity shares, shile offering tax rebate on such investments made in the scheme under section 80C of the Income-tax Act, 1961. It also seeks to distribute income periodically depending on distributable surplus. Investments in this scheme would be subject to a statutory lock-in of 3 years from the date of investment to avail Section 80C benefits.

Asset Allocation Pattern of the scheme

Types of Instruments Normal Allocation (% of net assets) 80 - 100%

Equity/Cum.convertible Preference Shares/ Fully Convertible Debentures and Bonds Money Market Instruments Not more than 20% Money Market Instruments will include commercial Paper, Commercial Bills, Certificates of Deposit, treasury Bills, Bills Rediscounting, repos, Government securities having an unexpired maturity of less than 1 year, Call or notice money, Usance bills and any other such short-term instruments as may be allowed under the regulations prevailing from time to time.

Performance of the scheme (As on 31 March 2008) Compounded Annualized MTGS Returns Returns for the last 1 year Returns for the last 3 year Returns for the last 5 year Returns since inception Returns (%) 106.99 121.77 44.28 19.63 BSE 100 Returns (%) 69.57 57.80 28.37 14.44

Year wise return

140 120 100 80 60 40 20 0 Returns for the last 1 Returns for the last 5

Return (%)

MTGS Return BSE Return

year

Plans and Options

Dividend Option with payout and reinvestment facility

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ASSET ALLOCATION
Minimum Application Amount 14%
Purchase

0%

Additional Purchase Multiples of Rs. 500 61%

Repurchase Rs.500

Rs. 500 25%

Large Cap

Small Cap

Mid Cap

Other Current Assets

PERFORMANCE REPORT & PORTFOLIO ANALYSIS : Benchmark : BSE 100 YTD Fund Benchmark
5.78% 8.66%

1m
-7.07% -3.42%

3m
-10.81% -8.74%

6m
5.78% 8.66%

1y
46.58% 41.63%

3y
87.26% 43.63%

5y
48.12% 26.97%

S.Inc
20.32% 13.36%

Last 3 Dividends
March 2008 150% June 2007 102% 27% Oct. 2006

Top Holdings
Infosys Technology Limited Satyam Computers Service Ltd. ` 4.78% 3.97% 3.51% 3.35% 3.11% 3.08% 3.07% 3.01% 2.98% 2.90% 2.78% 2.77% 2.61% 2.54% 2.28% 46.74%

The Associated Cement Companies Ltd. India Cements Ltd. Reliance Comunication Ltd Praj Industries Ltd. Havells India Ltd. Jai Prakash Assiciation Ltd. HLL Crompton Greaves Ltd Gujrat Ambuja Cement Ltd Zee Telefilms Ltd United Phosphours Ltd Shree Cement Ltd. Grasim Industry Ltd. Total

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Exit Load

NIL

Entry Load Investment below 5 crores- 2.25% Investment of Rs. 5 crores and above NIL

Scheme Option Dividend

SIP Rs. 500 Per Month 12 Month Rs. 1000 Per Month - 6 month Rs. 1500 per Quarter - 12 month

Minimum Investment Rs. 500

Risk profile of the scheme

Mutual fund investment are the subject to market risk . please read the offer document carefully for details on risk factor before investing

RESEARCH SECTION

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RESEARCH METHODOLOGY
Research is common parlance refresh to a search for knowledge. One can also define research as a scientific and systematic search for pertinent information on a specific topic. In fact, research is an art of scientific investigation. The Advanced Learners dictionary of current English lay down the meaning research as a careful investigation and inquiry especially through search for new facts in any branch knowledge.

Research is an academic activity and as such the term should be used in a technical sense. According to Clifford woody research comprises defining and redefining problems, formulating hypothesis or suggested solutions; collecting, organizing and evaluating data; making deductions and reaching conclusion; and at last carefully testing the conclusion to determine whether they fit the formulating hypothesis.

The systematic approach concerning generalization and the formulation of theory is also research. As such the term Research refers to the systematic method consisting of enunciating the problem, formulating a hypothesis, collecting the facts of data, analyzing the facts and reaching certain conclusion either in the form of solution towards the concerned problem or certain in certain generalization for some theoretical formulation.

RESEARCH DESIGN

A research design is the arrangement of conditions for collection and analyses of data in a manner that aims to combined relevance to the research purpose with economy in procedure. In fact, the research design is the conceptual structure within which research is conducted; it is constitute the blue print for the collection, measurement and analyses of data. Data Source Data Approach Sample Size Sample Unit Sample Area Sampling Method Persons involved : : : : : : : Primary Questionnaire 100 Persons Male and Females of age of 21 year old and above Lucknow City Non-probability -- Convenience Sampling Method 1

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FINDINGS AND ANALYSIS

1 . D o y o u k n o w a b o u t th e n a m e o f M u tu a l F u n d ?
No 14%
Interpretation

Y es
Out of total sample size of 100:

No

86% says yes they heard the name the mutual fund and 14% says no they do not heard the name the mutual fund

Y es 86%

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2 . .If Y E S , f o rm w h ic h s o u rc e s yo u k n o w a b o u t t h e M u tu a l F u n d ?
F rie n d s 10% T .V 20% F a m ily 10%
N ew s p ap er

N ew spa p er A d v e r ti s e m e n ts 2 Interpretation 0%
F a m i ly

T .V A d v e rtis e m Out of total sample size of 100: e n ts F rien d s 4 0% 10% says by news paper, 40% says by advertisements, 10% says by family,
20% says by TV, 10% says by friend to know the mutual fund

4. If ye s, than in which M utual Fund 3. D o yo u h a ve kn o w le d ge ste d? t T a x company u hav e inv e a b o u U TI S ch e m es o f M u tu al F u n d ?

20% Fra n klin No Ta m p le to n 36% 6% P R U IC IC I 14% H D FC 18% SBI B irla SBI H D FC 36% Interpretation IC IC I PRU Y es Fra n klin Ta m p le to n No Y es B irla U TI 64% 6 % of total sample size of 100: Out

64% people says they have the knowledge of tax scheme and 36% says not

Interpretation

Out of total sample size of 100:

36% says SBI MF, 20% says UTI MF, 18% says HDFC MF, 14% says PRU ICICI MF, 6% says Franklin Templeton MF and 6% says Birla Sunlife MF.

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5. If N o, than because of w hat reasons, like because of:Lack of Awareness 20% Lack of Add. 24% Lack of Add.

Interpretation Reliability Lack of

Lack of Lack of Awareness Out of total sample size of 100: Reliability 56%said lack of reliability, 24% said lack of addictively and 20% said lack of 56%
awareness.

6. If yes, then what features attract you to invest the money in Mutual Fund Company?

Interpretation returns Good Good returns Less Risk 14% Less Risk Tax rebate Diversification of 16% 30% Out of total sampleFunds 100: size of Liquidity Diversificati Liquidity 30% says Tax rebate,Fundssays liquidity, 16% says less risk, 14% says on of 22% 22% Tax rebate 14% diversification of risk, 14% says good return and 4% says others features Any other
Any other 4%

attracts them towards the mutual funds investment.

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7. W hat is minimum return that w ill attract you to put money in Mutual Funds?
Interpretation 10-15% 10-15% 16% above 25% 15-20% 42% 15-20% Out of total sample size of 100: 20-25% 20% 20-25% 42% says above 25% return, 22% says 20-25% above 25% 15-20% return return, 20% says 22%
and 16% says 10-15% return they would like to get on their investment.

8. Out of which Mutual Fund Tax Scheme would you prefer?

Nationalize 58%

Private InterpretationPrivate 42% Nationalize

Out of total sample size of 100:
58% says Nationalize and 42% says Private mutual fund companies.

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9. If Private then in which company?

Franklin Templeton 10% Reliance MF 28% Tata MF 16% Any other MF 0% PRU ICICI MF BIRLA Sunlife MF

PRU ICICI Interpretation MF Tata MF 32%

Reliance MF BIRLAof total sample size of 100: Out Sunlife MF Franklin 14% Templeton
Sunlife MF and 10% says Franklin Templeton MF.

32% says PRU ICICI MF, 28% says Reliance Any 16% says TATA MF, 14% says Birla MF, other MF

10. If nationalize, then in which company?

Any Other MF 4% UTI MF 22% SBI Interpretation MF UTI MF SBI MF 74% Any Other MF

Out of total sample size of 100:

74% says SBI Mutual Fund, 22% says UTI Mutual Fund and 4% says other.

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11. Your investment goal is:

Increase current Increase current income income Interpretation 32% Buy an assets Buy an Ensure a secure Out assets of total sample size of 100: retirement 48% says ensure20% retirement, 32% says increase in current income and 20% a secure
says to buy an assets.

Ensure a secure retirement 48%

12. Your plan to stay with investment?

More then 3 year 16% 2-3 year 20% Less then 1 Less then 1 year year Interpretation 1-2 year 34% 2-3 year 1-2 year 30%
Out of total sample size of 100:

More then 3 year

34% says less then one year, 30% says 1-2 year, 20% says 2-3 year and 16% says more then 3 year.

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13. From which source you would like to get information about your investment
Information through broker 30% Account Interpretation

statement at monthly base Account Account statement statement Out of total sample size of 100: at at monthly quarterly base Account 52% says account statement at monthly base, 30% says information through broker base Information statement 52% through broker and 18% says account statement at quarterly base. at quarterly base 18%

1 4 . Yo u d e s c rib e yo u rs e lf:
M o re risk ta ke r 18% little risk ta ke r 24%

R is Interpretation k av o id

Risk a vo id 58%

little ris k tak er M o re ris k tak er

Out of total sample size of 100:

58% says risk avoid, 24% says little risk taker and 18% says more risk taker.

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15. Is there any SBI Mutual Fund ISC in your city?

No 100%

Interpretation
Yes 0% Out of total sample size of 100:
All the 100% says no.

Yes No

SUGGESTION & RECOMMENDATION

As the maximum existing customers SBI Mutual Fund are highly satisfied, in that case the first and the foremost suggestion researcher would like to give is that personnel of SBI Mutual Fund should sustain the performance.

The official should try innovative measures to improve in the areas they are lagging behind so that the small percentage of dissatisfied customers can be converted into satisfied customers.

AMC officials should try and maintain Customer Relationship Management, which is not yet made applicable in such a renowned organization.

As the maximum existing customers SBI Mutual Fund are highly satisfied or organization should emphasis on customer delight rather than just satisfying the investors/customers.

SBI Mutual Fund is lagging behind in comparison to the competitors in terms of advertising. So the organization should try new and innovative methods of advertising to popularize its various schemes.

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LIMITATIONS

LIMITATIONS

1. Faced little bit of difficulty in collecting the required data. 2. Respondent were reluctant to fill the questionnaire. 3. Because of the very busy schedule. 4. Two months time is not enough to complete the survey. 5. Because of electricity problem too much time was consumed in preparation of the report. 6. Good time, efforts and money were spent in contacting the respondents to get the questionnaire filled. 7. The temperature was very high and scorching heat made the survey work very difficult.

77

ANNEXURE

QUESTIONNAIRE
1. Do you know about the name of Mutual Fund? Yes [ ] No [ [ ] ]

2. .If YES, form which sources you know about the Mutual Fund? Newspaper [ ] T.V Advertisements [ ] Friends Family [ ] Any other [

[
]

3. Do you have knowledge about Tax Schemes of Mutual Fund? Yes [ ] No [ ] 4. If yes, than in which Mutual Fund company u have invested? Specify . 5. If No, than because of what reasons, like because of:Lack of Add. [ ] Lack of Reliability Lack of Awareness [ ] Any other 6. [ [ ] ]

If yes, then what features attract you to invest the money in Mutual Fund Company? Good Returns [ ] Liquidity [ ] Less Risk [ ] Tax rebate [ ] Diversification of Funds [ ] Any other [ ]

7. What is minimum return that will attract you to put money in Mutual Funds? 10-15% [ ] 15-20% [ ] 20-25% [ ] above 25% [ ] 8. Out of which Mutual Fund Tax Scheme would you prefer? Private [ ] Nationalize 9. If Private then in which company? ICICI [ ] Tata [ ] Franklin Templeton [ ] Birla Reliance Any other [ [ [ [ [ ] ] ] ] ]

10. If nationalize, then in which company? SBI [ ] UTI Any other [ ]

79

11. Your investment goal is: Increase current income [ Ensure a secure retirement

] [

Buy an assets ]

12. Your plan to stay with investment? Less then 1 year [ ] 1-2 year 2-3 year [ ] more then 3 year

[ [

] ]

13. From which source you would like to get information about your investment? Account statement at monthly base Account statement at quarterly base Information through broker 14. You describe yourself: Risk avoid [ More risk taker [ ] ] little risk taker [ [ [ [ ] ] ] ]

15. Is there any SBI Mutual Fund ISC in your city? Yes [ ] No

Bibliography

81

BIBLIOGRAPHY
Investment management Research methodology by by V.K.Bhalla. C.R.Kothari.

Other sources
www.amfiindia.com www.indianmutualfund.com

www.moneycontrol.com

www.hdfcfund.com www.amfiindia.com www.sebi.gov.in www.mutualfundsindia.com www.nseindia.com www.bseindia.com