32068278 reliance mutual fund final project 2

8/6/2019 32068278 Reliance Mutual Fund Final Project 2

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SUMMER INTERNSHIP PROJECT REPORT2008-2009Corporate Guide:-Gaurav phatkar Faculty Guide:-

Prof,Dr. PophleIBSAR, KARJAT

Submitted in Partial Fulfillment for the Award of DegreeMASTER IN BUSSINESS ADMNISTRATIONSubmitted by: - Vinay Rastogi

FACULTY GUIDE CERTIFICATE

This is to certify that Vinay Rastogi, a student of IBSAR Institution of Management, Karjat pursuing his MMS/MBA (FINANCE) has worked under my guidance and supervision on his Work entitled “Reliance Mutual Fund”. To the best of my knowledgethis is an original piece of work.

(Prof. Dr. Phopale)Faculty finance

DECLARATION

I Vinay Rastogi do hereby declare that the project report entitled “Reliance Mutual Fund” being submitted to Mumbai University of, this is my own piece of workand it has not been submitted to any other institute or published at any time before.



Vinay R RastogiIBSAR insti

tution ofManagement

ACKNOWLEDGEMENT

This report bears the imprint of many people. Right from the experienced staff of Reliance Money, to the staff of IBSAR Institution of Management Karjat,withoutwhose support and guidance I would have not got the unique opportunity to successfully complete my internship in this esteemed organization.

I take this opportunity to express my deep gratitude to all the employees of, Reliance Money, Thane. Also I am indebted for the rich guidance, knowledge and suggestions provided by my guide, Prof. pophle who took sincere efforts and illustrated the Marketing Concept of Financial Products, with their vast knowledge in the field, which helped me in carrying out my internship.

I am gratified to Prof. Pophle for their earnest coordination owing to which, Ihad the leg-up of undertaking the internship at the prominent organization, Reliance Money Pvt ltd. Last but not least, I also thank all those people whom I met in the industry during my internship and helped me to accomplish my assignments in the most efficient and effective manner.

Date: 18th Aug 2008Place: Karjat (Vinay Rastogi)

EXECUTIVE SUMMARY

The project work is pursued as a part of MBA (FINANCE) Curriculum at IBSAR INSTITUTION OF MANAGEMENT, KARJAT. It is undertaken as a traineeship at Reliance Money Ltd. The project is done under expert supervision and guidance of Prof. Dr.POPHLE(Lecture Finance) and Mr. Gaurav patkar(Center Sales Manager, Reliance MoneyThane)

The Project is about the study of marketing and sales of financial products and

also the efforts done to make improvements in the customer acquisition process for better results.



At RELIANCE MONEY, initially the trainees were imparted process and product knowledge. They were given sufficient time to know about the products and also aboutsales and distribution channel They had to work with the sales representativesof the Distributor and think of ways of improving the sales and distribution channel and implementing them. The main aim was to increase sales and for this different ways were tried and implemented. They were provided with database and hadto make cold calls from the data. Company activity was also one of the major so

urces for generating business. Initially they even accompanied sales representatives to the clients place. Main objective was to know the need of the customer and how to fulfill that in the best way.

CONTENTS

1 INTRODUCTION 72 HISTORY & MUTUAL FUND REGULATION 9

3 TYPES OF MUTUAL FUND SCHEME IN INDIA 114 ADVANTAGES & FETURES OF MUTUAL FUND 195 COMPANY PROFILE 216 COMPETITORS RELIANCE MONEY 317 OBJECTIVE OF STUDY 368 RESERCH METHODOLOGY 379 DATA ANALYSIS AND INTERPRETATION 4010 OBSERVATION 4513 FINDINGS AND SUGGESTION ,QUESTIONNAIR 4614 LIMITATION 4815 CONCLUSION 4916 BIBLIOGRAPHY 50

INTRODUCTION

Mutual fundMutual funds can give investors access to emerging marketsA mutual fund is a professionally managed type of collective investment scheme that pools money from many investors and invests it in stocks, bonds, short-termmoney market instruments, and/or other securities. The mutual fund will have a fund manager that trades the pooled money on a regular basis. As of early 2008, the worldwide value of all mutual funds totals more than $26 trillion.Since 1940, there have been three basic types of investment companies in the United States: open-end funds, also known in the US as mutual funds; unit investment trusts (UITs); and closed-end funds. Similar funds also operate in Canada. However, in the rest of the world, mutual fund is used as a generic term for various types of collective investment vehicles, such as unit trusts, open-ended investment companies (OEICs), unitized insurance funds, and undertakings for collective investments in transferable securities (UCITS).There are a lot of investment avenues available today in the financial market for an investor with an invest able surplus. He can invest in Bank Deposits, Corporate Debentures, and Bonds where there is low risk but low return. He may investin Stock of companies where the risk is high and the returns are also proportionately high. The recent trends in the Stock Market have shown that an average re

tail investor always lost with periodic bearish tends. People began opting for portfolio managers with expertise in stock markets who would invest on their behalf. Thus we had wealth management services provided by many institutions. Howeve



r they proved too costly for a small investor. These investors have found a goodshelter with the mutual funds.

Like most developedand developing countries the mutual fund cult has been catching on in India. Thereasons for this interesting occurrence are:1. Mutual funds make it easy and less costly for investors to satisfy theirneed for capital growth, income and/or income preservation.

2. Mutual fund brings the benefits of diversification and money management tothe individual investor, providing aOpportunity for financial success that was once available only to a select few.

Fig.5.1 Concept of mutual fund

HISTORY • Unit Trust of India is the first Mutual Fund set up under a separate act, UTIAct in 1963, and started its operations in 1964 with the issue of units under the scheme US-641. In 1978 UTI was delinked from the RBI and Industrial Developmen

t Bank of India (IDBI) took over theRegulatory and administrative control in place of RBI.

• In the year 1987 Public Sector banks like State Bank of India, Punjab National Bank, Indian Bank, Bank of India, and Bank of Baroda have set up mutual funds.• Apart from these above mentioned banks Life Insurance Corporation [LIC] andGeneral Insurance Corporation [GIC] too have set up mutual fund. LIC establishedits mutual fund in June 1989.while GIC had set up its mutual fund in December 1990.The mutual fund industry had assest under management of Rs. 47,004 crores.

• With the entry of Private Sector Funds a new era has started in Mutual Fund Industry [e.g:- Principal Mutual Fund.]

Mutual Fund Regulations

The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It isregistered with SEBI and functions under the Mutual Fund Regulations. With thebifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of assets under management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among different private sector funds, the mutual fund industry has entered itscurrent phase of consolidation and growth. As at the end of September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421 schemes.

Types of Mutual Funds Scheme in India

Open end versus Closed end SchemesThere are two different types of funds.



• Open-ended Fund/ Scheme• Closed-ended fund/ SchemeThe key differences between the closed-end and open-end schemes area as follows:-The subscription to a closed-end scheme is kept open only for a limited period (usually one month to three months). Where an open-end scheme accepts funds frominvestors by offering its units or shares on a continuing basis.

A closed-end scheme does not allow investors to withdraw funds as and when theylike, whereas an open-end scheme permits investors to withdraw funds on a continuing basis under a re-purchase arrangement.A closed-end scheme has a fixed maturity period (usually five to fifteen years)whereas an open-end scheme has no maturity period.The closed-end schemes are listed on the secondary market, whereas the open-endschemes are ordinarily not list.In India, three entities are central to a mutual fund operation:• The sponsor,• The mutual fund• The asset management company.The sponsor is the key who establishes the mutual fund and the asset Management

Company. For example, Templeton International (sponsor) set up the Templeton Mutual Fund which has been constituted as a trust under the Indian Trusts Act, 1882 and registered with SEBI. The mutual fund is, in a way, an umbrella organization that floats various schemes in which investors participate. The asset management company, organized as a separate joint Stock company, manages the funds ofmutual fund under its various schemes. For example, Templeton Asset Management(India) Pvt. Ltd., the asset management company set up by Templeton International, manages the various schemes of Templeton Mutual Fund.Why one should invest in mutual funds?Mutual funds are preferable mode of investment due to the following reasons:• Reduction of risk• Professional Management• Tax benefits

• Low transaction costs• Highly regulated• Liquidity• Easy to administer

Why one should not invest in mutual funds?The following are the reasons, which are deterrent to mutual fund investment:• No control over costs• No tailor made portfolios• Managing a portfolio of funds

Constitution of a Mutual FundThere are a number of bodies that form a part of the mutual fund, they are as follows:• SponsorsThe sponsor is the company which sets up the mutual fund. It means anybody corporate acting alone or in combination with another body corporate established a mutual fund after initiating and completing the formalities.• TrusteesThe management of the mutual fund is subject to the control of the board of trustees of the fund. They guide the operations of the fund and carry the crucial responsibility to see that AMC always act in the best interest of the investors.• Asset Management CompanyThe mutual fund is operated by a separately established asset management company(AMC).It manages the funds of the various schemes. It is entrusted with the spe

cific task of mobilizing funds under the scheme.• CustodianA custodian is a person carrying on the activities of the safekeeping of the sec



urities or participating in any clearing system on behalf of the clients to effect deliveries of the securities.

• An EQUITY FUND invests mainly in stocks and shares of companies. EQUITYFUNDS typically aim to generate long term growth in the unit capital. There area variety of ways in which an equity portfolio can be created for investors. There are thus the following choices in equity funds:

o Simple equity fundso Industry Specific fundso Index fundso ELSSTarget market:They are ideal for investors having a long term perspective, Speculative outlook- the equity cult, who would like to make gains in the shortest period of time and investors in their prime earning years-specifically the young who have a decent earning and can take some kind of risk.

• A DEBT FUND invests mainly in debt instruments like bonds and debentures, with high and consistent dividend payout. These funds give decent returns but

the capital appreciation is not much. There are a variety of ways in which a debt portfolio can be created for investors. There are thus the following choices in debt funds:o Liquid and Money market fundso Gilt Fundso Monthly Income Plano Floating rate fundsTarget market:o Retired people and others with a need for stability and regular income.o Investors who need some income to supplement their earnings.

• A BALANCED FUND invests in both equity and debt instruments. It aims togenerate growth and income by periodically distributing its assets over both typ

es of securities.•Target market:These ideal for investors looking for a combination of income and moderate growth.

How to invest in mutual funds?The following are the essential steps which one must take into account while investing in Mutual funds:-Step 1- Identify the investment needsFinancial goals of an individual will vary, based on his/her age, lifestyle, financial independence, family commitments, level of income and expenses among manyother factors. Therefore the first step is to assess one’s needs, which can bedone by asking oneself these questions:

Net asset value (NAV)The net asset value, or NAV, is the current market value of a fund

s holdings, less the fund

s liabilities, usually expressed as a per-share amount. For most funds, the NAV is determined daily, after the close of trading on some specified financial exchange, but some funds update their NAV multiple times during the trading day. The public offering price, or POP, is the NAV plus a sales charge. Open-end funds sell shares at the POP and redeem shares at the NAV, and so processorders only after the NAV is determined. Closed-end funds (the shares of which are traded by investors) may trade at a higher or lower price than their NAV; this is known as a premium or discount, respectively. If a fund is divided into mul

tiple classes of shares, each class will typically have its own NAV, reflectingdifferences in fees and expenses paid by the different classes.Some mutual funds own securities which are not regularly traded on any formal ex



change. These may be shares in very small or bankrupt companies; they may be derivatives; or they may be private investments in unregistered financial instruments (such as stock in a non-public company). In the absence of a public market for these securities, it is the responsibility of the fund manager to form an estimate of their value when computing the NAV. How much of a fund

s assets may be invested in such securities is stated in the fund

s prospectus.Nature of Income Distribution to Investors

At a broad level, the investors have three options:• DIVIDEND PAY OUT OPTIONIn this option investors receive dividends from the mutual fund, as and when such dividends are declared. Dividends are paid in the form of warrants, or are directly credited to the investor’s bank accounts.• GROWTH OPTIONInvestors who do not require periodic income distributions can choose the growthoption, where the incomes earned are retained in the investment portfolio, andallowed to grow, rather than being distributed to the investors.• RE-INVESTMENT OPTIONIn this option investors re invest the dividends that are declared by the mutualfund, back into the fund itself, at NAV that is prevalent at the time of reinve

stment .In this option, the number of units held by the investor will change with every reinvestment. The value of the units will be similar to that under the dividend option.Different schemes of Reliance Mutual fundThe different schemes offered to various kinds of investors by Reliance mutual fund can be broadly classified into three categories –Equity, Debt and sector specific. Each of these categories has different investment objectives and therefore has different portfolio.Equity Schemes• Reliance Growth Fund• Reliance Vision Fund• Reliance NRI Equity Fund• Reliance Equity Opportunities Fund

• Reliance Index Fund• Reliance Tax Saver Fund• Reliance Equity FundDebt Schemes• Reliance Income Fund• Reliance Medium Term Fund• Reliance Short Term Fund• Reliance Liquid Fund• Reliance Monthly Income Plan• Reliance Gilt Securities Fund• Reliance Floating Rate Fund• Reliance NRI Income FundSector Specific Schemes

• Reliance Banking Fund• Reliance Pharma Fund• Reliance Media and Entertainment Fund• Reliance Diversified Power Sector FundAs I was more involved in the understanding and promotion of the NFO of RelianceEquity Fund during the initial part of my training. I would like to summarize it in brief.Reliance Equity FundThe Reliance Equity Fund is an open ended diversified equity fund that seeks toprovide long term capital appreciation by investing in a portfolio constituted of equity and equity related securities of top 100 companies by market capitalization and of companies that are available in derivatives segment, belonging to di

verse sectors.The investment strategy being that even if the markets go down, the fund has a part of its portfolio hedged, which aims at minimizing the downside risk. The fun



d will not only use hedging techniques to limit the downside risk but will alsotry & capitalize on short selling opportunities to generate additional returns for the investors. The fund will invest 75-100% in equity and equity related instruments and 0-25% in debt and money market securities. In a nut shell what thisfund tries to do:• Generate long term returns by investing in a diversified portfolio of stocks.

• Minimize the downside risk by being in a hedged position• Capitalize on generating additional returns by selective shorting.

ADVANTAGES OF MUTUAL FUNDSThere are numerous benefits of investing in mutual funds and one of the key reasons for its phenomenal success in the developed markets like US and UK is the range of benefits they offer, which are unmatched by most other investment avenues.Diversification

The nuclear weapon in your arsenal for your fight against Risk. It simply means that you must spread your investment across different securities (stocks, bonds, money market instruments, real estate, fixed deposits etc.) and different sectors (auto, textile, information technology etc.).Tax BenefitsAny income distributed after March 31, 2002 will be subject to tax in the assessment of all Unit holders. However, as a measure of concession to Unit holders ofopen-ended equity-oriented funds, income distributions for the year ending March 31, 2003, will be taxed at a concessional rate of 10.5%.Regulations

Securities Exchange Board of India (“SEBI”), the mutual funds regulatorhas 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

Affordability

A mutual fund invests in a portfolio of assets, i.e. bonds, shares, etc. depending upon the investment objective of the scheme. Azn investor can buy in to a portfolio of equities, which would otherwise be extremely expensive.

Features related mutual funds

• Reliance was the first fund house to launch sector funds with flexibility to invest in a range of 0% to 100% in either equity or debt instruments.

• Mutual fund investments linked to an ATM/debit card a Relianceinnovation India’s first long-short fund comes from Reliance Mutual Fund.

• As at 31st May 2008, more than 6.6 million people had invested in Reliance Mutual Fund;the investments comprised 16% of the country’s entire mutual fund.



RELIANCE INDUSTRIES LIMITED

Reliance Group Holdings has grown from a small office data-processing equipment firm in 1961 into a major insurance and financial-services group in one generation under one chief.

Reliance

s insurance operations constitute the nation

s 27th-largest property and casualty operation. The parent company also includes a dev

elopment subsidiary in commercial real estate. Reliance

s international consulting group contains several subsidiaries in energy, environment, and natural resources consulting. A financial arm invests in other businesses, primarily television stations.

Reliance Insurance started as the Fire Association of Philadelphia in 1817, organized by 5 hose and 11 engine fire companies. It became the nation

s first association of volunteer fire departments.Business got a boost as a result of the Great

Chicago Fire of 1871.The association soon developed a field of agents to write policies across the country. For the first two years, shareholders received dividends twice a year of $5 a share, which increased gradually to $10 in 1876.

In 1972, the Reliance insurance group divided its pool so that Reli

ance Insurance Company and itssubsidiaries handled most standard lines, while United Pacific Insurance Companyhandled the nonstandard and other operations.

In 1977, the company moved into real estate, forming Continental Cities Corporation, which became Reliance Development Group, Inc. This division handled all real estate operations of the parent company and other subsidiaries.

Reliance Capital Group, L.P. constituted the investment branch ofthe Reliance conglomerate.In December 1989, Reliance Capital sold its investment, Days Corporation, parentcompany of Days Inn of America, the world

s third-largest hotel chain; it had been purchased in 1984.

Reliance Industries Limi

ted. The Group

s principal activity is to produce and distribute plastic and intermediates, polyester filament yarn, fibre intermediates, polymer intermediates,crackers, chemicals, textiles, oil and gas. The refining segment includes production and marketing operations of the Petroleum refinery. The petrochemicals segment includes production and marketing operations of petrochemical products namely, High and Low density Polyethylene.Reliance Money is promoted by Reliance Capital; one of India

s leading and fastest growing private sector financial services companies, ranking among the top 3private sector financial services and banking companies, in terms of net worth.Reliance Capital is a part of the Reliance Anil Dhirubhai Ambani Group.Thus, Reliance Money provides a comprehensive platform, offering an investment avenue for a wide range of asset classes. Its endeavor is to change the way Indiatransacts in financial market and avails financial services. Reliance Money offers a single window facility, enabling you to access amongst others, Equities, Equity and Commodity derivatives, Offshore Investments, IPO’s, Mutual Funds, LifeInsurance and General Insurance products.Advantages offered by Reliance money over other companies:• Cost Effective• Convenience• Security• Single Window for Multiple Products• 3 in 1 Integrated Access• Demat Account with Reliance Capital• Other Services like research, live news from Reuter and Dow Jones, etc.



"Growth has no limit at Reliance. I keep revising my vision.Only when you can dream it, you can do it."

Dhirubhai Ambani founded Reliance as a textile company and led its evolution asa global leader in the materials and energy value chain businesses.He is credited to have brought about the equity cult in India in the late seventies and is regarded as an icon for enterprise in India. He epitomized the spirit

dare to dream and learn to excel

.The Reliance Group is a living testimony to his indomitable will, single-mindeddedication and an unrelenting commitment to his goals.

RELIANCE MUTUAL FUND

This groupdominates this key areain the financial sector..This megabusiness houses show that it has assetsunder management ofRs. 90,938 crore(US$22.73 billion) andan investor base of over6.6 million (Source:www.amfiindia.com).Reliance’s mutual fundschemes are managed byReliance Capital AssetManagement Li

mitedRCAM), a subsidiary ofReliance Capital Limited,which holds 93.37% ofthe paid-up capitalof RCAM.The company notchedup a healthy growth ofRs. 16,354

crore(US$ 4.09 billion)in assets under management in February2008 and helped propelthe total industry-wideAUM to Rs. 565,459 crore (US$ 141.36 billion)(Source:indiainvestments.com). A sharp rise infixed maturity plans (FMPs) and collection ofRs. 7000 crore (US$ 1.75 billion) through newfund offers (NFOs) created thissurge. In AUrankings, Reliance continues to be in thenumber one spot.

India

s Best Offering: Reliance Mutual FundInvesting has become global. Today, a lot of countries are waking up to the re

ality that in order to gain financial growth, they must encourage their citizensto not only save but also invest. Mutual funds are fast becoming the mode of in

vestment in the world.

In India, a mutual fund company called the Reliance Mutual Fund is making waves.Reliance is considered India

s best when it comes to mutual funds. Its investors number to 4.6 billion people. Reliance Capital Asset Management Limited ranksin the top 3 of India

s banking companies and financial sector in terms of net value.

The Anil Dhirubhai Ambani Group owns Reliance; they are the fastest growing investment company in India so far. To meet the erratic demand of the financial market, Reliance Mutual Fund designed a distinct portfolio that is sure to please potential investors. Reliance Capital Asset Management Limited manages RMF.

Vision And Mission

Reliance Mutual Fund is so popular because it is investor focused. They show their dedication by continually dishing out innovative offerings and unparalleled service initiatives. It is their goal to become respected globally for helping people achieve their financial dreams through excellent organization governance and customer care. Reliance Mutual fund wants a high performance environment thatis geared at making investors happy.

RMF aims to do business lawfully and without stepping on other people. They wantto be able to create portfolios that will ensure the liquidity of the investmen

t of people in India as well as abroad. Reliance Mutual Fund also wants to makesure that their shareholders realize reasonable profit, by deploying funds wisely. Taking appropriate risks to reach the company

s potential is also one of Reli



ance Mutual Fund

s objectives.

Schemes

To make their packages more attractive, Reliance Mutual Fund created proposals called The Equity/ Growth scheme, Debt/Income Scheme, and Sector Specific Scheme.

i. Debt/Income Scheme, and Sector Specific Scheme.

The Equity/ Growth scheme give medium to long term capital increase. Themajor part of the investment is on equities and they have fairly high risks. The

scheme gives the investors varying options like, capital augmentation or dividend preference. The choices are not deadlocked because if you want you may changethe options later on.

Providing steady and regular income is one of the Debt/Income Scheme

sprimary goals. The Debt/Income scheme has in its portfolio government securities, corporate debentures fixed income securities, and bonds. returns on SectorSpecific Scheme are dependent on the performance of the industry at which yourmoney is invested upon. Compared to diversified funds this is a lot more risky and you will need to really give your time on observing the market.

Although RMF is gaining good ground in the financial market, remember that they are a risk taking bunch. They give higher profit because they take a lo

t of risks. So, if you are faint hearted, then Reliance Mutual Fund is not for you.

PRODUCTS : RELIANCE MONEY

The products on offer from Reliance MutualFund fall into four main categories: equity, debt,sector specific and ETF (Exchange Traded Fund).Each taps into a specific audience profile fulfilling their varying needs.Under the equity category,Reliance has118 SUPERBRANDS sixteen schemes with Reliance Growth Fundand Reliance Vision Fund as its flagship schemes.Reliance Equity Opportunities Fund is a schemewhich operates in the multi-cap/multi-sectorsegment; Reliance Equity Fund isa long-shortfund, Reliance Quant Plus Fund is a quant fund.Reliance offers investments in banking, power,media, entertainment and pharmaceuticals;Reliance TaxSaver Fund and Reliance Equity-Linked Savings Fund – Series 1 are tax saving schemes; an NRI-dedicated equity scheme istailored for non-resident Indians. RelianceRegular Savings Fund is an asset-allocation fund with three options.Under the debt and liquid categories, Reliancehasliquid funds, liquid plus funds, income funds,an NRI-dedicated debt fund, gilt

funds, fixedmaturity plans and an interval fund.In the hybrid category, RelianceMonthlyincome Plan is a popular option



Reliance understands that investments in mutual fundshare a function of knowledge dissemination and awareness of products amongst potential investors. In building its ownbase of assets under management it will necessarily haveto carry the entire mutual fundindustry.Towards this end Reliance has launched a t wo-pronged initiative.In the first pincer it has created aformidable network of 26,000 distributors including some of thebiggest names in the banking sector.This who’s who of the financia

l industry comprises such giants asCitibank, Standard Chartered, HSBC,ICICI, AXIS, Bank of Baroda, Central Bank of India, Allahabad Bank andfund houses such asJM, DSP Merrill Lynch and Karvy in addition to a massive infrastructure of direct financial investment officers. Thisprodigious effort is supplemented by thebrands’ captive network of 120 branch officesand 30 financial centres. In the second prong, Reliance has created a series ofinformationpacked presentations which help dispel misinformationGroup.This megabusiness house dominates this key area in the financial sector.Figures for March2008 show that it has emerged as the top Indian mutual fund with average assetsunder management of Rs. 90,938 crore (US$ 22.73 billion) and an investor base of over 6.6 million (Source:www.amfiindia.com).

Reliance’s mutual fund schemes are managed by

RelianceCapitalAssetManagementLimited (RCAM), a subsidiary of Reliance Capital Limited,which holds 93.37% of the paid-up capitalof RCAM.The company notchedup ahealthy growth ofRs. 16,354 crore (US$ 4.09billion)inassetsunder management in February2008 and helped propelthe total industry-wideAUM to Rs. 565,459 crore(US$141.36 billion) (Source: indiainvestments.com). A sharp rise infixed maturity plans (FMPs)andcollection of Rs. 7000 crore (US$ 1.75 billion) through new fund offers (NFOs) created this surge. InAUMrankings, Reliance continues to be in thenumber one spot.

Reliance was the first fund house to launch sector funds with flexibility to invest in a range of 0% to 100% in either equity or debt instruments Mutual fund investments linked to anATM/debit card are a Reliance innovationIndia’s first long-short fund comes from Reliance Mutual Fund As at 31st May 2008, more than 6.6

million people had invested in Reliance Mutual Fund;the investments comprised 16% of the country’s entire mutual fund asset base.

Achievements

In two successive joint surveys by The Economic Times’ Brand Equity and ACNielsen, Reliance was recognised as India’s Most Trusted Mutual Fund.Thecompanyalsowalked away with seven other scheme prizes – five of them being outright winners –in the Gulf 2007 Lipper Awards.These included the Fund House of the Year by Lipper GCC as well asICRA Online and the Most Improved FundHouse by Asia Asset Management.It also received the NDTV Business Leadership Award 2007 in the mutual fund category and runners’ up recognition as the Best Fund House in theOutlook Money-NDTV Profit Awards. In addition,the company received thecoveted CNBC Web18 Genius of the Web distinction for the Best Mutual Fund Website inthe country. RCAM was awarded the India Onshore Fund House 2008 instituted by theAsian Investormagazine.The company also won the India Equities award in the 5-yearPerformancecategory.



COMPARATIVE STUDY OF MUTUAL FUND

Major competitor of Reliance Money

Company Profile of HDFC HDFC BANK is one of the leading Depository Participant (DP) in the country with

over 8 Lac demat accounts.

HDFC Bank Demat services offers you a secure and convenient way to keep track ofyour securities and investments, over a period of time, without the hassle of handling physical documents that get mutilated or lost in transit.

HDFC BANK is Depository participant both with -National Securities DepositoriesLimited (NSDL) and Central Depository Services Limited (CDSL).Features & BenefitsAs opposed to the earlier form of dealing in physical certificates with delays in transaction, holding and trading in Demat form has the following benefits:

• Settlement of Securities traded on the exchanges as well as off market transactions.• Shorter settlements thereby enhancing liquidity.• Pledging of Securities.• Electronic credit in public issue.• Auto Credit of Rights / Bonus / Public Issues / Dividend credit throughECS.• Auto Credit of Public Issue refunds to the bank account.• No stamp duty on transfer of securities held in demat form.

No concept of Market Lots.Change of address, Signature, Dividend Mandate, registration of power of

attorney, transmission etc. can be effected across companies held in demat formby a single instruction to the Depository Participant (DP).

Secured & easy transaction processing

HDFC Bank Ltd provides convenient facility called

SPEED-e

(Internet based transaction) whereby account holder can submit delivery instructions electronicallythrough SPEED-e website (https://speed-e.nsdl.com). SPEED-e offers secured meansof transaction processing eliminating preparation of instruction slips and submission of the same across the counter to the depository participant. The

IDEAS

facility helps in viewing the current transactions and balances (holdings) of Demat account on Internet on real time basis.

Company Profile of ICICIICICIDirect (or ICICIDirect.com) is stock trading company of ICICI Bank. Along with stock trading and trading in derivatives in BSE and NSE, it also provides facility to invest in IPOs, Mutual Funds and Bonds. Trading is available in BSE and NSEICICIDirect offers 3 different online trading platforms to its customers

1. Investment AccountAlong with stock trading and IPO investing in BSE and NSE, Wise Investment account also provide options to invest in Mutual Funds and Bonds online.



Online Mutual funds investment allows investor to invest on-line in around 19 Mutual Fund companies. ICICI Direct offers various options while investing in Mutual Funds like Purchase Mutual Fund, Redemption and switch between different schemes, Systematic Investment plans, Systematic withdrawal plan and transferring existing Mutual Funds in to electronic mode. This account also provides facility to invest in Government of India Bonds and ICICI Bank Tax Saving Bonds.ICICIDirect.com website is the primary tool to invest in Mutual Funds, IPOs, Bon

ds and stock trading.

Reliance MoneyTax Saving funds Reliance Money:

Tax-saving funds (due to their equity-oriented nature) are capable of clocking far superior returns their assured return counterparts like Natio

nal Savings Certificate (NSC) and Public Provident Fund (PPF). However investorsmust appreciate that the risk profile of tax-saving funds tends to be proportionately higher.

Reliance Tax Saver (ELSS) Fund (RTSF) is the latest entrant in the tax-saving funds segment. Flagship diversified equity funds (Reliance Growth Fund and Reliance Equity Fund) from Reliance Mutual Fund have emerged as top performers intheir segment across time horizons. However investors should note that these funds are managed aggressively; also they have displayed an opportunistic streak by moving fluidly across market segments (large caps, mid caps) to clock superiorgrowth. RTSF is likely to be a similar (high risk - high return) investment proposition within the tax-saving funds segment.

SYSTEM INVESTMENT PLAN

SIP is a way of investing in Mutual Funds. It is designed for thoseinvestors who are willing to invest regularly rather than making a lump sum investment. It is just like a recurring deposit with the post office or bank where we deposit some amount every month. The difference here is that the amount is invested in a mutual fund. Mutual Fund makes investment according to their objective .They collect fund from investor and invests it. Every fund has an objective and pattern of investing. There are various kinds of mutual funds. There are equity funds and debt funds. Further equity funds can be divided into equity diversified mutual fund where funds are invested in shares of different companies , sectoral funds where investment is made in shares of some particular sector like FMCG, IT, Auto, Oil & Gas, Banking etc. Every fund has a NAV (net asset value) which is the value per unit. It is calculated as the total asset is divided by thenumber of outstanding units. As the value of asset changes, nav also changes.

The best way to invest in stock market is mutual fund through Systematic Investment Plan. But to get the benefit of an SIP, a long term horizon is must.



OBJECTIVE

To give a brief idea about the benefits available from mutual Fund investment.

To give an idea of the types of schemes available.

Explore the recent developments in the mutual funds in India

To give an idea about the regulations of mutual funds.

To analyze reliance mutual fund strategy against its competitor.

RESEARCH METHODOLOGY

Research as a care full investigation or enquiry specially through search for anew facts in any branch of knowledge”Research is an academic activity and such as the term should be used in technical sense.The manipulation of things , concepts or symbols for the purpose of ge

neralizing to extend ,correct or verify knowledge ,whether that knowledge through objective.

TYPES OF RESEARCH

ANALYTICAL RESERCH

In this project work, analytical research is used. In this project has to use facts or information .Already used available ,and analyze these to make a critical evolution of the material.

METHODS OF DATA COLLECTION

In this project work primary and secondary data sources of data has been used.

Primary data: Primary data collect through observation, or through direct communication or doing experiments .

Secondary data: Secondary data means already available through books ,journals ,magazines ,newspaper.



TOOLS OF ANALYSIS

For the proper analysis of data Quantitative Technique such as percentage method was used.

DATA ANALYSIS AND INTERPRETATION

Q.1 Which banking mutual fund do you prefer for mutualFund ?

Co mpany Name Persentages of respondentsReliance Money 25HDFC 10ICICI 15

INTERPRETATION: 50% of respondent have Reliance Money, 30% of respondent says that other%.

Q.2 Which banking mutual fund offer you good investment plan?

Company Name Percentage of respondentReliance 22HDFC 21ICICI 7

INTERPRETATION:44% respondent for Reliance,32 %forHdfc,14% for ICICI

Q.3 Which banking mutul fund offer a lot of tax saving?Company Name Percentage of respondentReliance 20HDFC 15ICICI 15

INTERPRETATION:40% respondent for Reliance,30 %forHdfc,30% for ICICI

Q.4 Which banking mutual fund offer you a large number of product & services?Company Name Percentage of respondentReliance 18

HDFC 16ICICI 16



INTERPRETATION:36% respondent for Reliance,32%forHdfc,32% for ICICI

Q.5 Which banking mutual fund offer you a good e-mail facility ?Company Name Percentage of respondentReliance 22HDFC 15ICICI 13

INTERPRETATION:44% respondent for Reliance,30%forHdfc,26% for ICICI

Represent by pie chart

OBSERVATION

50% of respondent have Reliance Money, 30% of respondent says that other%.

44% respondent for Reliance, 32 %forHdfc,14% for ICICI.

40% respondent for Reliance, 30 %forHdfc,30% for ICICI.

36% respondent for Reliance, 32%forHdfc,32% for ICICI.

44% respondent for Reliance, 30%forHdfc,26% for ICICI.



FINDINGS AND SUGGESTION

In Equity Schemes we have taken Reliance Vison Fund and Reliance growth Fund .Both schemes are open ended but Reliance Growth fund is more valuable for Reliance Mutual Fund than reliance vision Fund.In Dedt scheme we have taken Reliance money Manager Fund and Reliance LiquidtyFund .In it boths schemes are open ended but reliance money manager is more beneficial for reliance mutual fund .In sector specific scheme we have taken Reliance media and entertainment fund and Reliance Pharma fund schemeboth is more efficient for Reliance Mutual Fund.Above all the schemes of Reliance Mutual Fund Debt schemes are best schemes forMutual Fund .

There is a Good investment plan and saving scheme in reliance Mutual Fund.SUGGESTION• Reliance Money have to add some extra features in it with aggressive marketing promotional strategy.• Advertisement on television is the main source of attraction so the company must advertise its products heavily.• Product must be improved .• There should be provision of complain suggestion boxes at each branch.

QUESTIONNAIRQ.1 Which banking mutual fund do you prefer for mutual

Fund ?• Reliance Money• HDFC• ICICI

Q.2 Which banking mutual fund offer you good investment plan?• Reliance Money• HDFC• ICICI

Q.3 Which banking mutul fund offer a lot of tax saving?• Reliance Money• HDFC• ICICI

Q.4 Which banking mutual fund offer you a large number of product & services?• Reliance Money• HDFC• ICICI

Q.5 Which banking mutual fund offer you a good e-mail facility ?• Reliance Money• HDFC• ICICI

Limitations



• The time constraint was one of the major problems.• The study is limited to the different schemes available under the mutual fundsselected.• The study is limited to selected mutual fund schemes.• The lack of information sources for the analysis part.

CONCLUSION

Mutual Fund investment is better than other raising fund .Reliance Mutual Fund have good returns in investment .

A good brand is always welcomed over here people are more aware and conscious for the brand so they go for they are ready to spend some extra bucks for the quality .

At last all con be concluded by that Reliance Money is still growing industry inIndia and is still exploring its potential and prospects in here.

BIBLIOGRAPHY

Websites:www.reliancemoney.comwww.hdfc.comwww.icicidirect.com

Referencebooks:•FINANCIAL INSTITUTIONS AND MARKETS - L.M.BHOLE•INVESTMENT MANAGEMENT - V.K.BHALLAResearch Methodology - Kothari

32068278 reliance mutual fund final project 2

Documents