BBA Final Year Project (Finance) Christy Thomas 17PUC26084

“COMPARATIVE STUDY ON EQUITY SCHEMES OF VARIOUS MUTUAL
FUND COMPANIES”
CHAPTER 1 – INTRODUCTION
About Mutual Funds

Mutual Funds operate as collective investment vehicles (CIV) that pools resources by
issuing units to investors and collectively invests those resources in a diversified portfolio
comprising of stocks, bonds or money market instruments in accordance with the
objectives mentioned in the offer document issued for the purpose of pooling resources.
The investors share the profit or losses in proportion to their investments in the fund. The
first ever Mutual Fund in India, the Unit trust of India was set up in 1964. This was
followed by entry of MFs supported by public sector banks and insurance companies in
1987. The industry was opened for the private players in 1993 providing Indian investors
with a broader choice. Starting with an asset base of Rs. 25 crore in 1964, the industry has
grown exponentially.
The MF industry in India is governed by the SEBI, which lay norms for MF and its Asset
Managing Companies (AMCs). A Mutual Fund is allowed to issue open-ended and closed-
ended schemes under a common legal structure. Respective Asset Management Companies
(AMC) manages mutual fund schemes. Different business groups/ financial institutions/
banks have sponsored these AMCs, either alone or in collaboration with reputed
international firms. Several international funds like Alliance and Templeton are also
operating independently in India. Many more international Mutual Fund giants are
expected to come into Indian markets in the near future.
Acharya Institute of Graduate Studies Page 1

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Market survey plays a vital role in understanding the investment pattern of the customer
and the level of satisfaction. It is very important for the company to perform such activities
like market research and surveys at regular intervals and accordingly further plans and
policies can be formulated. By studying the investment pattern of the customers, the
company can plan the strategies to capture the more market share by providing the better
services and customized plans.
Mutual Funds are dynamic financial institutions, which play a crucial role in an economy
mobilizing a link between savings and the capital market. Therefore the activities of
Mutual Funds have both short and long term impact on the savings and capital markets and
the national economy. Mutual Funds thus assist the process of financial deepening and
intermediation. They mobilize Funds in the savings market and act as complementary to
banking, at the same time they also compete with banks and other financial institutions. In
the process stock market activities are also significantly influenced by Mutual Funds. The
scope and efficiency of Mutual Funds are influenced by overall economic fundamentals,
the interrelationship between the financial and real sector, the nature of development of the
savings and capital markets, market structure, institutional arrangements and overall policy
regime.

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Definition of Mutual Fund
1. A mutual fund is a professionally-managed investment scheme, usually run by an asset

management company that brings together a group of people and invests their money in
stocks, bonds and other securities.
2. A mutual fund is a type of financial vehicle made up of a pool of money collected from

many investors to invest in securities like stocks, bonds, money market instruments, and
other assets. Mutual funds are operated by professional money managers, who allocate the
fund's assets and attempt to produce capital gains or income for the fund's investors. A
mutual fund's portfolio is structured and maintained to match the investment objectives
stated in its prospectus.
Features of Mutual Funds

1. Portfolio Diversification – Mutual Funds diversifies your investments by investing
in different asset classes. As an individual investor, one cannot afford to invest in variety of
sectors, mutual funds offers diversification and exposure to multiple sectors through
minimal investment.
2. Professional Management – Mutual Funds are managed by qualified experienced
professionals who works towards fulfillment of investment objective of the fund.
3. Affordability – You can start your investment in Mutual Fund systematic investment
plan with a minimum investment of as low as Rs. 500.
4. Liquidity – Open ended Mutual Funds can be redeemed totally or partially at the
present value.
5. Transparency – Mutual Funds Performance is easily available on their own website
as well the performance is reviewed and published by esteemed publications and rating
agencies.
6. Rupee Cost Averaging – Regular investing irrespective of the market trends help
you average your investment cost over a period of time. You get higher number of units

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when the markets are falling. Similarly, if the markets are rising, the overall value of the
portfolio increases.
7. Consistent Savings – Help you make periodical and consistent investments. Adds
financial discipline into your life through regular investing .
8. Choice of Investment – There is a wide range of mutual funds schemes available to
meet individual goals. It also offers flexibility in the mode of investments such as SIP and
Lump sum.
Advantages of Mutual Fund
1. Diversification
One of the biggest advantages mutual funds give you is that of immediate diversification.
You may not have enough money to spread your investments in varied stocks and sectors,
but by pooling money from thousands of similar investors, a mutual fund spreads your
investment and hence, risk. It is highly unlikely that all the stocks will go down by the
same proportion on any particular day. This ensures that you have not kept all your eggs in
one basket and are safe from incurring huge losses from a single bad investment.
2. Professional Management
Another big benefit of investing in mutual funds is the professional expertise it provides for
your investments. Asset Management Companies (AMCs) provide qualified fund managers
who, with the help of strong research teams and their own expertise, pick the best options
to meet the fund's objective. This saves you time and the stress of constantly monitoring
your investments and wondering if you made the right buy or sell decision. With mutual
funds, you do not have to worry about market swings.
3. Affordability
You may want to buy shares of large companies or want to invest in big companies in a
particular sector of choice. However, you may not have the money to make a big
investment. Mutual funds trade in big volumes, giving their investors the advantage of
lower trading costs. Anyone can start an investment in a mutual fund through a Systematic
Investment Plan (SIP) with as little as Rs 500.

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For example, say Pooja has just started her career and wishes to put aside atleast Rs 48,000
annually to go on an overseas vacation after three years. Instead of waiting to collect a
lump sum of Rs 48,000 to kick start the investment, mutual funds allow Pooja to invest a
small sum of Rs 4,000 every month, in the form of a SIP. This makes it affordable for
Pooja and at the same time keeps her goal on track.
4. Liquidity
You can easily move your money in and out of mutual fund investments. Investments in
open-ended funds can be redeemed in part or as a whole any time to receive the current
value of the units.
5. Tax Benefits
There are various tax benefits available on your investments in mutual funds. For example,
investments in Equity Linked Savings Schemes (ELSS) qualify for tax deductions under
Section 80C of the Income Tax Act. There is no tax on capital gains on units of equity
schemes held for more than 12 months.
Schemes other than equity-oriented schemes are treated in the debt category for tax
purposes. Short term capital gain is applicable for redemption of debt mutual funds within
3 years. Long term capital gain (more than 3 years) from debt mutual funds is taxable after
claiming the benefit of Indexation.
6. Well Regulated
In India, all mutual funds are regulated by the Securities and Exchange Board of India
(SEBI). All mutual funds are required to follow transparent processes, as laid down by
SEBI, protecting the interest of investors. Further, SEBI makes it compulsory for all mutual
funds to disclose their portfolios every month.
Disadvantages of Mutual Funds

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1. High Expense Ratios and Sales Charges

If you're not paying attention to mutual fund expense ratios and sales charges, they can get
out of hand. Be very cautious when investing in funds with expense ratios higher than
1.20%, as they are considered to be on the higher cost end. Be wary of advertising fees and
sales charges in general. There are several good fund companies out there that have no
sales charges. Fees reduce overall investment returns.
2. Management Abuses
Churning, turnover, and window dressing may happen if your manager is abusing his or her
authority. This includes unnecessary trading, excessive replacement, and selling the losers
prior to quarter-end to fix the books.
3. Tax Inefficiency
Like it or not, investors do not have a choice when it comes to capital gains payouts in
mutual funds. Due to the turnover, redemptions, gains, and losses in
security holdings throughout the year, investors typically receive distributions from the
fund that are an uncontrollable tax event.
4. Poor Trade Execution

If you place your mutual fund trade anytime before the cut-off time for same-day NAV,
you'll receive the same closing price NAV for your buy or sell on the mutual fund. For
investors looking for faster execution times, maybe because of short investment horizons,
day trading, or timing the market, mutual funds provide a weak execution strategy.
Classification of Mutual Funds
Based on the maturity period:
1. Open-ended funds: An open ended fund is a fund that is available for subscription and
can be redeemed on a continuous basis. It is available for subscription throughout the year
and investors can buy and sell units at NET ASSET VALUE (NAV) related prices. These
funds do not have a fixed maturity date. The key feature of an open-ended fund is liquidity.

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2. Close-ended Funds: A close ended fund is a fund that has a defined maturity period,
for example 5-7 years. These funds are open for subscription for a specified period at the
time of initial launch. These funds are listed with a recognized stock exchange.
3. Exchange traded funds: Exchange traded funds combine the features of open-ended
and close-ended funds. These funds may trade on stock exchanges and are open for sale or
redemption at predetermined intervals on the prevailing NET ASSET VALUE (NAV).
4. Unit investment trusts: UTIs are also issued to the public only once when they are
created. They have a fixed maturity period and a fixed portfolio of securities which is
determined at the time of creation.
Based on investment objectives:

1. Equity/growth funds: Equity funds invest minimum 65% of its corpus in equity and
equity related securities. These funds may invest in a wide range of industries or focus on
one or more industry sectors. These types of funds are suitable for investors with a long-
term outlook and higher risk appetite.
2. Debt/income funds: Debt/income funds generally invest in securities such as bonds,
corporate debentures, government securities and money market instruments. These funds
invest minimum 65% of their corpus in fixed income securities. By investing in debt
instruments, these funds provide low risk and stable income to investors with preservation
of capital. These funds tend to be less volatile than equity funds and produce regular
income.
3. Balanced/Hybrid funds: Balanced funds invest in both equities and fixed income
instruments in line with the pre-determined investment objective of the scheme. These
funds provide both stability of returns and capital appreciation to investors.
4. Money market/liquid funds: Money market/liquid funds invest in safer short-term
instruments such as Treasury bills, certificates of deposit and commercial paper for a
period of less than 91 days. The aim of money market/liquid funds is to provide easy
liquidity, preservation of capital and moderate income.

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5. Gilt funds: Gilt funds invest exclusively in government securities. Although these
funds carry no credit risk, they are associated with interest rate risk. These funds are safer
as they invest in government securities.
Other schemes:
1. Tax saving funds: Tax-saving schemes offer tax rebates to investors under specific
provisions of the Income tax Act1961. These are growth-oriented schemes and invest
primarily in equities. Like an equity scheme, they largely suit investors having a higher risk
appetite and aim to generate appreciation over medium to long run.
2. Index Funds: Index Funds replicate the performance of a particular index such as the
BSE Sensex or the S&P CNX Nifty. The portfolio of these schemes consist of only those
stocks that represent the index and the weightage assigned to each stock is aligned to the
stock’s weightage in the index.
3. Sector-specific Funds: Sector-specific Funds invest in the securities of only those
sectors or industries as specified in the scheme information department. The returns in
these funds are dependent on the performance of the respective sector/industries.
Important key words related to mutual funds:
1. NAV: Net asset value refers to the total value of the related mutual fund scheme. It
shows the overall value which may vary everyday as per the changes in the market.
2. Units: The value of mutual fund is divided into units as per the number of persons it
is sold. The value of each unit changes every day.
3. Unit holder: The investor who purchases the units of mutual funds is called unit
holder. He/she may keep as many units as he/she wants.
CHAPTER – 2

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RESEARCH DESIGN
Review of Literature:
1. Sapar & Narayan(2003)
Examines the performance of Indian mutual funds in a bear market through relative
performance index, risk-return analysis, Treyor's ratio, Sharp's ratio, Sharp's measure with
a sample of 269 open ended schemes (out of total schemes of 433).
2. Rao D. N (2006)
Studied the financial performance of select open-ended equity mutual fund schemes for the
period 1st April 2005 - 31st March 2006 pertaining to the two dominant investment styles
and tested the hypothesis whether the differences in performance are statistically
significant. The analysis indicated that growth plans have generated higher returns than that
of dividend plans but at a higher risk studied classified the 419 open-ended equity mutual
fund schemes into six distinct investment styles.
3. Agrawal Deepak & Patidar
Deepak (2009) studied the empirically testing on the basis of fund manager performance
and analyzing data at the fund-manager and fund-investor levels. The objective of the study
is to provide an overview of mutual fund activity in emerging markets, to describe their
size, asset allocation, to analyze the Indian Mutual Fund Industry pricing mechanism with
empirical studies on its valuation, to analyze data at both the fund-manager and fund-
investor levels.

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The study reveled that the performance is affected saving and investment habits of the
people at the second side the confidence and loyalty of the fund Manager and rewards
affects the performance of the MF industry in India.
4. Mehta Sushilkumar (2010)
Analyze the performance of mutual fund schemes of SBI and UTI and found out that SBI
schemes have performed better then the UTI in the year 2007-2008 studied the risk and
return relationship of Indian mutual fund schemes. The study found out that out of thirty
five sample schemes, eleven showed significant t–values and all other twenty four sample
schemes did not prove significant relationship between the risk and return. According to t-
alpha values, majority (thirty two) of the sample schemes' returns were not significantly
different from their market returns and very few number of sample schemes' returns were
significantly different from their market returns during the study period.
5. Mr. Vijay Anand (2000)
Mr. Vijay Anand in IFMR, Chennai (June 2000).The study focused on to understand the
position of the schemes of birla sunlife and the competitors schemes available in the
market. The study did Analysis of Performance of Equity fund for 3 years and SWOT
Analysis of Birla Sunlife by Literature survey, Delphi technique, in depth financial review
to identify among the selected equity funds that earns higher returns than benchmark and
competitors and concluded that Birla Sunlife performs well compared to the benchmarks
and competitors.
6. Prasath.R.H (2009)
The study is trying to emphasize the core values of mutual fund investment, benefits of
mutual funds, types of mutual funds, etc., The study is going to conducted by taking the

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NAV values of different types of HDFC mutual fund products. The study concludes that
before choosing the mutual fund scheme, the investor should undergo fact sheet thoroughly
and he has to choose the best one by calculating NAV calculation. If the investor finds
difficulty of getting Rp, Rf, Standard deviation, and Beta parameters, NAV calculations are
the best alternative to assess the performance.
7. Dr S Narayan Rao (2002)
The Study is conducted to understand whether most of the mutual fund schemes were able
to satisfy investor’s expectations by giving excess returns over expected returns. The
objective of this study was to evaluate the performance of Indian Mutual Fund Schemes
during bear market through relative performance index (RPI), risk- return analysis. The
research study concluded that out of 269 schemes, 49 were under performers, 102 were par
performers and 118 were out performers of the market and Medium Term Debt Funds were
the best .It was also concluded that 58 of 269 open ended mutual funds have provided
better returns than the market during the bear period of September 98-April 2002. Some of
the funds provided excess returns over expected returns based on both premium for
systematic risk and total risk.
8. Dr. S. Anand & Dr. V Murugaiah (2003)
The purpose of this study is to apply the measurement tools of modern portfolio theory to
the performance of mutual funds. The study aims to examine the degree of correlation that
exists between fund and market return, to understand the impact of fund specific
characteristics on performance ,to evaluate the diversification and selectivity skills of fund
managers. The study concluded on the basis of overall analysis in can be inferred here that
the additional return on sampled schemes and the market over risk free return was

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significantly low during the study period. The study covers the period between April 1999
and March 2003 This indicates that the majority of schemes were showed
underperformance in comparison with risk free return.
Need for the study:
The basic need of the study is to analyse the performance of Equity schemes of few select
mutual fund companies in terms of returns and to know in which kind of fund the investor
would like to invest in. In a competitive market like India there are multiple mutual funds
working. It is necessary to know the performance of these mutual funds because it greatly
impacts the investment decisions of the public.
Objectives of the study:
 To know and explain equity schemes in brief
 To understand the concept of Mutual Fund, its working, mechanism and types traded
in India.
 To compare the performance of equity funds of few mutual fund companies in terms
of return and other factors.
 To know which scheme of Equity mutual fund is most preferable for the investors .
 To analyze the performance of equity schemes of Birla Sun Life MF, Nippon India
MF, ICICI Prudential MF, SBI, UTI.
 To give brief idea about mutual funds available in India .
 To give an idea about the schemes available.
 To give idea about the regulation of mutual fund.

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Scope of the study:
 This study is to understand the crucial role of mutual fund in the market.
 It will cover the theoretical frame work of equity schemes in these selected mutual
fund companies.
 To analyze the performance of equity schemes of the mutual fund companies and to
give suggestions for better investment options.
 The Equity Schemes were categorized and selected for evaluating their performance
and Returns. The scope of the project is mainly concentrated on the various companies
mutual funds such as equity schemes.
Operational definitions of the concepts:
1. Net Asset Value(NAV)
- The value of a collective investment fund based on the market price of securities held
in its portfolio. NAV per share is calculated by dividing net assets of the scheme /number
of Units outstanding.
2. Assets Under Management (AUM)
- It is used to gauge how much money a fund is managing. Mutual Funds use this as a
measure of success and comparison against their competitors; in lieu of revenue or total
revenue they use total 'assets under management'. The difference between two AUM
balances consists of market performance gains/ (losses), foreign exchanges movements, net
new assets (NNA) inflow/(outflow) and structural effects of the company.
3. Diversified Equity Funds

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- A diversified equity fund invests in companies regardless of size and sector. It
diversifies investments across the stock market in a bid to maximize gains for investors.
They are offered by unit-linked insurance plans / ULIPs, mutual funds and other
investment firms.
4. Sector Specific Funds
- Mutual funds which invest in a particular sector or industry are said to be sector-
specific funds. Since the portfolio of such mutual funds consists mainly of investment in
one particular type of sector, they offer less amount of diversification and are considered to
be risky.
5. Tax Planning Funds / Equity Linked Savings Scheme (ELSS)
- Tax-planning funds cater to the investors' need of minimizing tax burden on the
returns from investments. They are also called equity-linked tax saving funds or ELSS.
These funds are market capitalization agnostic. These are close ended schemes with a lock-
in period of 3 years.
6. Annual Returns
- Annual return is defined as the percentage change in an investment over a one-year
period. Annualized return is the percentage change in an investment measured over periods
shorter or longer than one year but stated as a yearly rate of return.
METHODOLOGY OF THE STUDY:
Data collection:

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Data is collected from secondary sources like company’s website, financial journals, recent
fact sheet of mutual fund, various mutual fund websites like www.amfiindia.com,
www.mutualfudsindia.com, www.valueonlineresearch.com,etc.
Data compilation and Data analysis:
The data collected from the secondary sources is refined carefully and the necessary
information is taken. The analysis is in this way, each year we observe changes in the
NAV, AUM, Return percentage, for three different equity funds (Diversified equity, sector
specific and ELSS) of the selected mutual fund companies ( Birla Sun Life MF, Nippon
India MF, ICICI Prudential MF, UTI MF, SBI MF). Then the performance of each of the
above said mutual fund is compared and analysed to find out the best performing mutual
fund among them. Large cap funds are used for analyzing diversified equity. Sectoral funds
for analysis of companies are chosen randomly .
Limitations of the study:
 Insufficient time to cover and present all schemes of the selected mutual fund
companies.
 It is restricted to Equity schemes only.
 The study does not provide any predictions or forecast of the selected schemes.
 The data collection was strictly confined to secondary sources.
 Collecting historical NAV is very difficult.
 Selection of schemes for study is very difficult because of wide varieties in equity
Schemes.

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 To get an insight in the process of risk and return and deployment of funds by fund
manager is difficult.
 The project is unable to analyse each and every equity scheme of mutual funds to
create awareness about risk and return. The risk and return of mutual fund equity schemes
can change according to the market conditions.
 Data collected from secondary sources may not always be accurate or dependable for
research and analysis.
 Technical tools have some disadvantages which have impact on Equity schemes.
Type of Research:
This research is quantitative and analytical in nature. Quantitative research talks about the
performance of equity funds of the mutual fund companies and analytical research is
concerned with determining the best equity funds to invest in based on analysis of the
collected data.
CHAPTER SCHEME:-
Chapter-1: Introduction
Chapter-2: Research design
Chapter-3: Industry profile
Chapter-4: Data analysis and interpretation
Chapter-5: Summary of findings, conclusions and suggestions
Bibliography

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CHAPTER 3 – INDUSTRY PROFILE
The mutual fund industry has been in India for a long time. This came into existence in
1963 with the establishment of Unit Trust of India, a joint effort by the Government of
India and the Reserve Bank of India. The year of 1993 marked the beginning of a new era
in the Indian mutual fund industry with the entry of private players like Morgan Stanley,
J.P Morgan, and Capital International. SEBI (Security Exchange Board of India) was
established under which all the mutual funds in India were required to be registered. SEBI
was set up as a governing body to protect the interest of investor. By the end of 2008, the
number of players in the industry grew enormously with 46 fund houses functioning in the
country. With the rise of the mutual fund industry, establishing a mutual fund association
became a prerequisite. This is when AMFI (Association of Mutual Funds India) was set up
in 1995 as a nonprofit organization. Today AMFI ensures mutual funds function in a
professional and healthy manner thereby protecting the interest of the mutual funds as well
as its investors.
Mutual funds are considered as one of the best available investment options as compare to
others alternatives. They are very cost efficient and also easy to invest in. The biggest
advantage of mutual funds is they provide diversification, by reducing risk & maximizing
returns. India is ranked one of the fastest growing economies in the world. Despite this

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huge progression in the industry, there still lies huge potential and room for growth. India
has a saving rate of more than 35% of GDP, with 80% of the population who save. These
savings could be channel zed in the mutual funds sector as it offers a wide investment
option. Further tapping rural markets in India will benefit mutual fund companies from the
growth in agriculture and allied sectors. As it can be noted, there is huge growth and
potential in the mutual fund industry. The development of this sector so far has been
commendable and with the above positive factors we are looking at a more evolved
industry.
History of Mutual Funds:
The Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 defines a
mutual fund as a ‘a fund established in the form of a trust to raise money through the sale
of units to the public or a section of the public under one or more schemes for investing in
securities, including money market instruments’.
According to the above definition, a mutual fund in India can raise resources through sale
of units to the public. It can be set up in the form of a Trust under the Indian Trust Act. The
definition has been further extended by allowing mutual funds to diversify their activities in
the following areas:
· Portfolio management services
· Management of offshore funds
· Providing advice to offshore funds
· Management of pension or provident funds
· Management of venture capital funds

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· Management of money market funds
· Management of real estate funds
A mutual fund serves as a link between the investor and the securities market by mobilising
savings from the investors and investing them in the securities market to generate returns.
Thus, a mutual fund is akin to portfolio management services (PMS). Although, both are
conceptually same, they are different from each other. Portfolio management services are
offered to high net worth individuals; taking into account their risk profile, their
investments are managed separately. In the case of mutual funds, savings of small investors
are pooled under a scheme and the returns are distributed in the same proportion in which
the investments are made by the investors/unit-holders.
Mutual fund is a collective savings scheme. Mutual funds play an important role in
mobilising the savings of small investors and channelising the same for productive ventures
in the Indian economy.
The history of mutual funds, dates back to 19th century Europe, in particular, Great Britain.
Robert Fleming set up in 1868 the first investment trust called Foreign and Colonial
Investment Trust which promised to manage the finances of the moneyed classes of
Scotland by spreading the investment over a number of different stocks. This investment
trust and other investment trusts which were subsequently set up in Britain and the US,
resembled today’s close-ended mutual funds. The first mutual fund in the US,
Massachusetts Investors’ Trust, was setup in March 1924. This was the first open-ended
mutual fund.

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The stock market crash in 1929, the Great Depression, and the outbreak of the Second
World War slackened the pace of growth of the mutual fund industry. Innovations in
products and services increased the popularity of mutual funds in the 1950s and 1960s. The
first international stock mutual fund was introduced in the US in 1940. In 1976, the first
tax-exempt municipal bond funds emerged and in 1979, the first money market mutual
funds were created. The latest additions are the international bond fund in 1986 and arm
funds in 1990. This industry witnessed substantial growth in the eighties and nineties when
there was a significant increase in the number of mutual funds, schemes, assets, and
shareholders. In the US, the mutual fund industry registered a ten fold growth in the
eighties (1980-89) only, with 25% of the household sector’s investment in financial assets
made through them. Fund assets increased from less than $150 billion in 1980 to over $4
trillion by the end of 1997. Since 1996, mutual fund assets have exceeded bank deposits.
The mutual fund industry and the banking industry virtually rival each other in size.
Growth of Mutual Funds in India:
The Indian mutual fund industry has evolved over distinct stages. The growth of the mutual
fund industry in India can be divided into four phases: Phase I (1964-87), Phase II (1987-
92), Phase III (1992-97), and Phase IV (beyond 1997).
Phase I: The mutual fund concept was introduced in India with the setting up of UTI in
1963. The Unit Trust of India (UTI) was the first mutual fund set up under the UTI Act,
1963, a special act of the Parliament. It became operational in 1964 with a major objective
of mobilising savings through the sale of units and investing them in corporate securities

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for maximising yield and capital appreciation. This phase commenced with the launch of
Unit Scheme 1964 (US-64) the first open-ended and the most popular scheme.
UTI’s investible funds, at market value (and including the book value of fixed assets) grew
from Rs 49 crore in1965 to Rs 219 crore in 1970-71 to Rs 1,126 crore in 1980-81 and
further to Rs 5,068 crore by June 1987. Its investor base had also grown to about 2 million
investors. It launched innovative schemes during this phase. Its fund family included five
income-oriented, open-ended schemes, which were sold largely through its agent network
built up over the years. Master share, the equity growth fund launched in 1986, proved to
be a grand marketing success. Master share was the first real close-ended scheme floated
by UTI. It launched India Fund in 1986-the first Indian offshore fund for overseas
investors, which was listed on the London Stock Exchange (LSE). UTI maintained its
monopoly and experienced a consistent growth till 1987.
Phase II: The second phase witnessed the entry of mutual fund companies sponsored by
nationalised banks and insurance companies. In 1987, SBI Mutual Fund and Canbank
Mutual Fund were set up as trusts under the Indian Trust Act, 1882. In 1988, UTI floated
another offshore fund, namely, The India Growth Fund which was listed on the New York
Stock Exchange (NYSB). By 1990, the two nationalised insurance giants, LIC and GIC,
and nationalised banks, namely, Indian Bank, Bank of India, and Punjab National Bank had
started operations of wholly-owned mutual fund subsidiaries. The assured return type of
schemes floated by the mutual funds during this phase were perceived to be another

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banking product offered by the arms of sponsor banks. In October 1989, the first regulatory
guidelines were issued by the Reserve Bank of India, but they were applicable only to the
mutual funds sponsored by FIIs.
Subsequently, the Government of India issued comprehensive guidelines in June 1990
covering all ‘mutual funds. These guidelines emphasised compulsory registration with
SEBI and an arms length relationship be maintained between the sponsor and asset
management company (AMC). With the entry of public sector funds, there was a
tremendous growth in the size of the mutual fund industry with investible funds, at market
value, increasing to Rs 53,462 crore and the number of investors increasing to over 23
million. The buoyant equity markets in 1991-92 and tax benefits under equity-linked
savings schemes enhanced the attractiveness of equity funds.
Phase III: The year 1993 marked a turning point in the history of mutual funds in India.
Tile Securities and Exchange Board of India (SEBI) issued the Mutual Fund Regulations in
January 1993. SEBI notified regulations bringing all mutual funds except UTI under a
common regulatory framework. Private domestic and foreign players were allowed entry in
the mutual fund industry. Kothari group of companies, in joint venture with Pioneer, a US
fund company, set up the first private mutual fund the Kothari Pioneer Mutual Fund, in
1993. Kothari Pioneer introduced the first open-ended fund Prima in 1993. Several other
private sector mutual funds were set up during this phase. UTI launched a new scheme,
Master-gain, in May 1992, which was a phenomenal success with a subscription of Rs

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4,700 crore from 631akh applicants. The industry’s investible funds at market value
increased to Rs 78,655 crore and the number of investor accounts increased to 50 million.
However, the year 1995 was the beginning of the sluggish phase of the mutual fund
industry. During 1995 and 1996, unit holders saw an erosion in the value of their
investments due to a decline in the NA V s of the equity funds.
Moreover, the service quality of mutual funds declined due to a rapid growth in the number
of investor accounts, and the inadequacy of service infrastructure. A lack of performance of
the public sector funds and miserable failure of foreign funds like Morgan Stanley eroded
the confidence of investors in fund managers. Investors perception about mutual funds,
gradually turned negative. Mutual funds found it increasingly difficult to raise money. The
average annual sales declined from about Rs 13,000 crore in 1991-94 to about Rs 9,000
crore in 1995 and 1996.
Phase IV: During this phase, the flow of funds into the kitty of mutual funds sharply
increased. This significant growth was aided by a more positive sentiment in the capital
market, significant tax benefits, and improvement in the quality of investor service.
Investible funds, at market value, of the industry rose by June 2000 to over Rs 1,10,000
crore with UTI having 68% of the market share. During 1999-2000 sales mobilisation
reached a record level of Rs 73,000 crore as against Rs 31,420 crore in the preceding year.
This trend was, however, sharply reversed in 2000-01. The UTI dropped a bombshell on

FUND COMPANIES”
the investing public by disclosing the NAV of US-64-its flagship scheme as on December
28,2000, just at Rs 5.81 as against the face value of Rs 10 and the last sale price of Rs
14.50. The disclosure of NAV of the country’s largest mutual fund scheme was the biggest
shock of the year to investors.
Crumbling global equity markets, a sluggish economy coupled with bad investment
decisions made life tough for big funds across the world in 2001-02. The effect of these
problems was felt strongly in India also. Pioneer m, JP Morgan and Newton Investment
Management pulled out from the Indian market. Bank of India MF liquidated all its
schemes in 2002.
The Indian mutual fund industry has stagnated at around Rs 1,00,000 crore assets since
2000-01. This stagnation is partly a result of stagnated equity markets and the indifferent
performance by players. As against this, the aggregate deposits of Scheduled Commercial
Banks (SCBs) as on May 3, 2002, stood at Rs 11,86,468 crore. Mutual funds assets under
management (AUM) form just around 10% of deposits of SCBs.
The Unit Trust of India is losing out to other private sector players. While there has been
an increase in AUM by around 11% during the year 2002, UTI on the contrary has lost
more than 11% in AUM. The private sector mutual funds have benefited the most from the
debacle ofUS-64 of UTI. The AUM of this sector grew by around- 60% for the year ending
March 2002.

FUND COMPANIES”
BUSINESS STRUCTURE OF MUTUAL FUND:

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Regulatory body of mutual funds in India:
SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI):
- The Indian mutual fund industry witnessed robust growth and stricter regulation from
SEBI since 1996. The mobilization of funds and the number of players operating in the
industry reached new heights as investors started showing more interest in mutual funds.
Safeguarding the interests of investors is one of the duties of SEBI. Consequently, SEBI
(Mutual Funds) Regulations, 1996 and certain other guidelines have been issued by SEBI
that sets uniform standards for all mutual funds in India. All the mutual funds have to be
registered with SEBI. The regulations have laid down a detail procedure for launching of
schemes, disclosure in the offer document, advertisements, listing and repurchase of close-
end schemes, offer period, transfer of units, investments, among others.
- SEBI, the regulatory authority for the Indian Mutual fund industry has consistently
introduced several regulatory measures and amendments in order to protect the interests of
small investors. The Securities Exchange Board of India (Mutual Funds) Regulations,
1996, is the principal regulation for the Mutual fund industry in India. This was amended
several times with the latest amendment being issued in 2012.
- In addition, the SEBI took various measures and issued guidelines to facilitate
operations of mutual funds. As part of these measures, mutual funds were allowed to invest
in foreign debt securities in the countries with full convertible currencies and with highest

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foreign currency credit rating by accredited credit rating agencies. They were also allowed
to invest in government securities where the countries are AAA rated. Moreover,
guidelines were issued for valuation of unlisted equity shares in order to bring about
uniformity in the calculation of NAVs of mutual fund schemes. In order to allow mutual
funds to invest in both gold and gold related instruments, the SEBI amended its regulation
in 2006. The amended regulation, “Securities and Exchange Board of India (Mutual Funds)
(Amendment) Regulation, 2006” permits introduction of Gold Exchange Traded Fund
(GETF) Schemes by mutual fund. The new mutual fund scheme can invest primarily in
gold and gold related instruments, subject to certain investment restrictions.
- With SEBI regulations, all mutual funds have been brought under a common
regulatory framework to ensure greater degree of transparency in their operations and
adherence to a common structure. This act spells out numerous restrictions and
requirements designed to protect the interests of the investors, and ensure that each mutual
fund scheme is managed and operated in the best interest of its unit holders.
ASSOCIATION OF MUTUAL FUNDS IN INDIA (AMFI):
- With the increase in mutual fund players in India, a need for mutual fund association
in India was generated to function as a non-profit organization. Association of Mutual
Funds in India (AMFI) was incorporated on 22nd August, 1995. AMFI is an apex body of
all Asset Management Companies (AMC) which has been registered with SEBI. Till date
all the AMCs are that have launched mutual fund schemes are its members. It functions
under the supervision and guidelines of its Board of Directors.

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- Association of Mutual Funds India has brought down the Indian Mutual Fund
Industry to a professional and healthy market with ethical lines enhancing and maintaining
standards. It follows the principle of both protecting and promoting the interests of mutual
funds as well as their unit holders.
- AMFI is an industry association, incorporated in 1995. Some researchers say it is not
an SRO, so it can just issue guidelines to members. It cannot enforce regulations. ―AMFI
uniquely positioned for a regulatory role and could become India‘s first SRO. This
proposed SRO should appoint representatives capable of regulating the industry and SEBI
also not want to appoint any of its representatives on the board. But on the other side some
of the experts include it into SRO category even in its present status.
Objectives of AMFI:
 To define and maintain high professional and ethical standards in all areas of
operation of mutual fund industry.
 To recommend and promote best business practices and code of conduct to be
followed by members and others engaged in the activities of mutual fund and asset
management including agencies connected or involved in the field of capital markets and
financial services.
 To interact with the Securities and Exchange Board of India (SEBI) and to represent
to SEBI on all matters concerning the mutual fund industry.
 To represent to the Government, Reserve Bank of India and other bodies on all
matters relating to the Mutual Fund Industry.

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 To develop a cadre of well trained Agent distributors and to implement a programme
of training and certification for all intermediaries and other engaged in the industry.
 To undertake nationwide investor awareness programme so as to promote proper
understanding of the concept and working of mutual funds.
 To disseminate information on Mutual Fund Industry and to undertake studies and
research directly and/or in association with other bodies.
 To protect the interests of investors / unit holders
Net Asset Value:
The net asset value of a fund is the market value of the assets minus the liabilities on the
day of valuation. In other words, it is the amount which the shareholders will collectively
get if the fund is dissolved or liquidated. The net asset value of a unit is the net asset value
of fund divided by the number of outstanding units.
The formula for calculating NAV:
NAV of a mutual fund = Assets of the fund – Liabilities of the fund, divided by number of
outstanding units of the fund.
A fund’s NAV is affected by four sets of factors: purchase and sale of investment
securities, valuation of all investment securities held, other assets and liabilities, and units
sold or redeemed.
SEBI has issued guidelines on valuation of traded securities, thinly traded securities and
non-traded securities. These guidelines were issued to streamline the procedure of
calculation of NAV of the schemes of mutual funds. The aggregate value of illiquid

FUND COMPANIES”
securities as defined in the guidelines shall not exceed 15% of the total assets of the scheme
and any illiquid securities held above 15% of the total assets shall be valued in the manner
as specified in the guidelines issued by the SEBI. Where income receivables on
investments has accrued but has not been received for the period specified in the guidelines
issued by SEBI, provision shall be made by debiting to the revenue account the income so
accrued in the manner specified by guidelines issued by SEBI.
Mutual funds are required to declare their NAV s and seller purchase prices of all schemes
updated daily on regular basis on the AMFI website by 8.00 p.m. and declare NAV s of
their Close-ended schemes on every Wednesday.
According to SEBI (Mutual Funds) (Second Amendment) Regulations, 2000, a mutual
fund can now invest up to 5% of its NAV in the unlisted equity shares or equity related
instruments in case of open-ended schemes; while in case of close-ended schemes, the
mutual fund can now invest up to 10% of its NAV.
Mutual Fund Investors:
Mutual funds in India are open to investment by –
a) Residents including:-
 Resident Indian Individuals, including high net worthindividuals and the retail or
small investors. Indian Companies
 Indian Trusts/Charitable Institutions
 Banks
 Non-Banking Finance Companies

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 Insurance Companies
 Provident Funds
b) Non-Residents, including
 Non-Resident Indians
 Other Corporate Bodies (OCBs)
c) Foreign entities, namely, Foreign Institutional Investors (FIIs) registered with SEBI.
Foreign citizens/ entities are however not allowed to invest in mutual funds in India.
Market survey plays a vital role in understanding the investment pattern of the customer
and the level of satisfaction. It is very important for the company to perform such activities
like market research and surveys at regular intervals and accordingly further plans and
policies can be formulated. By studying the investment pattern of the customers, the
company can plan the strategies to capture the more market share by providing the better
services and customized plans.
Major mutual funds companies in India:
Public sector mutual funds:
1. Bank of Baroda mutual fund
2. SBI mutual fund
3. LIC mutual fund
4. UTI mutual fund
5. Canara bank mutual fund
Private sector mutual funds:

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1. ABN AMRO mutual fund
2. Birla sun life mutual fund
3. HDFC mutual fund
4. HSBC mutual fund
5. ICICI Prudential mutual fund
6. Tata mutual fund
7. Standard Chartered mutual fund
8. Morgan Stanley mutual fund
9. Reliance mutual fund
10. Franklin Templeton mutual fund
These above are the various mutual funds in India which has given a good return.

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CHAPTER 4: DATA ANALYSIS AND
INTERPRETATION
ADITYA BIRLA SUN LIFE MUTUAL FUND
Equity funds used for analysis :
1. Aditya Birla Sun Life Frontline Equity (Diversified – Large cap)
- The objective of the scheme is long term growth of capital, through a portfolio with a
target allocation of 100% equity by aiming at being as diversified across various industries
and/ or sectors as its chosen benchmark index, Nifty 50 TRI. The secondary objective is
income generation and distribution of dividend.
2. Aditya Birla Sun Life MNC Fund (Sectoral Fund)
- The objective of the Scheme is to achieve long-term growth of capital at relatively
moderate levels of risk by making investments in securities of multinational companies
through a research based investment approach. Investments primarily in equity and equity-
related securities of multinational companies.
3. Aditya Birla Sun Life Tax Relief 96 (Tax Saving fund / ELSS)
- An open-ended equity linked savings scheme (ELSS) with the objective of long-term
growth of capital through a portfolio with a target allocation of 80% equity, 20% debt and

FUND COMPANIES”
money market securities. Investors looking for an investment option which offers benefit
under Section 80C of Taxation with a lock-in period of 3 years only.
Table 4.1: Performance Analysis of Equity Schemes of Aditya Birla Sun life
Mutual Fund
TYPE YEAR NAV (₹) RETURN (%) AUM

1 YEAR 3 YEAR (Cr.)
ABSL Frontline 2018 224.49 -1.90 13.74 20,829.10
Equity 2019 226.26 -4.35 6.97 20,285.51
(diversified)
2020 240.21 6.94 8.02 20,203.36
ABSL MNC 2018 780.83 -0.23 11.69 3,504.09
fund 2019 736.18 -8.15 4.78 3,388.65
(Sectoral)
2020 854.20 9.19 11.43 3,932.94
ABSL Tax 2018 31.84 -2.27 15.31 7,423.33

Relief 2019 30.39 -10.14 7.81 8,326.64
96 (ELSS)
2020 34.38 7.36 11.65 10,185.25
Graph 4.1: Graphical Representation of 3 yr return % of Aditya Birla Sun Life
Equity schemes

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18.00
16.00
14.00
12.00
10.00
3 yr return% -
8.00 2018
6.00 3 yr return% -
2019
4.00
3 yr return% -
2.00 2020
0.00
ABSL Frontline ABSL MNC fund ABSL Tax Relief
Equity 96
Interpretation :
 In Aditya Birla Sun Life Frontline Equity scheme, the performance of NAV has
increased from 224.49 to 240.21 rupees, the 1yr return % has decreased from -1.90% to
-4.35% in 2019 but increased to 6.94% in 2020, the 3 yr return % has decreased from
13.74% to 6.97% in 2019 but increased to 8.02% in 2020 and AUM has slightly decreased
from 20,829.10 to 20,203.36 crores.
 In Aditya Birla Sun Life MNC Fund, the performance of NAV has increased from
780.83 to 854.20 rupees, the 1 yr return % decreases from -0.23% to
11.69% to 4.78% in 2019 but increased to 11.43% in 2020 and AUM has increased from
3,504.09 to 3,932.94 crores.

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 In Aditya Birla Sun Life Tax Relief 96, the performance of NAV has increased from
31.84 to 34.38 rupees, the 1 yr return % has decreased from
-2.27% to -10.14% in 2019 but increased to 7.36% in 2020, the 3yr return % has decreased
from 15.31% to 7.81% in 2019 but increased to 11.65% in 2020 and AUM has increased
from 7,423.33 to 10,185.25 crores.
NIPPON INDIA MUTUAL FUND
Equity funds used for analysis:
1. Nippon India Large Cap Fund (diversified – large cap)
- The primary investment objective of the scheme is to seek to generate long term
capital appreciation by investing predominantly into equity and equity related instruments
of large cap companies. The secondary objective is to generate consistent returns by
investing in debt and money market securities.
2. Nippon India Pharma Fund (Sectoral fund)

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- The primary investment objective of the scheme is to seek to generate consistent
returns by investing in equity and equity related or fixed income securities of pharma and
other associated companies.
3. Nippon India Tax Saver Fund (Tax saving fund / ELSS)
- 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. It
is an open ended equity linked saving scheme with a statutory lock in of 3 years and tax
benefit.
Table 4.2: Performance Analysis of Equity Schemes of Nippon India

Mutual Fund

1 YEAR 3 YEAR (Cr.)
Nippon India 2018 34.43 -0.78 16.21 11,661.70
Large Cap Fund
2019 34.64 -1.31 10.83 12,033.79
(diversified)
2020 36.36 4.56 10.64 12,304.02
Nippon India 2018 162.01 9.90 4.72 2,759.32
Pharma Fund 2019 144.98 -5.86 0.00 2,318.71
(sectoral)
2020 165.16 2.47 5.81 2,446.42
Nippon India 2018 53.46 -21.99 8.61 9,554.04
Tax Saver Fund 2019 51.81 -12.92 1.69 9,486.82
(ELSS)
2020 55.80 1.79 1.56 10,223.64

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Graph 4.2: Graphical Representation of 3 yr return % of Nippon India Mutual Fund

schemes
18.00
16.00
14.00
12.00
10.00
3 yr return% -
8.00 2018
3 yr return% -
6.00 2019
4.00 3 yr return% -
2020
2.00
0.00
Nippon India Nippon India Pharma Fund Nippon India
Large Cap Fund Tax Saver Fund
Interpretation :
 In Nippon India Large Cap Fund, the performance of NAV has increased from 34.43
to 36.36 rupees, the 1 yr return % has increased from -0.78% to 4.56%, the 3 yr return %
has decreased from 16.21% to 10.64% and AUM has increased from 11,661.70 to
12,304.02 crores.
 In Nippon India Pharma Fund, the performance of NAV has decreased from 162.01
to 144.98 rupees in 2019 but increased to 165.16 rupees in 2020, the 1 yr return % has
decreased from 9.90% to -5.86% in 2019 but increased to 2.27 % in 2020, the 3 yr return %

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has decreased from 4.72% to 0% in 2019 but increased to 5.81% in 2020 and AUM has
decreased from 2,759.32 to 2,446.42 crores.
 In Nippon India Tax Saver Fund, the performance of NAV has decreased from 53.46
to 51.81 rupees in 2019 but increased to 55.80 rupees in 2020,the 1 yr return % has
increased from -21.99% to 1.79%, the 3 yr return % has decreased from 8.61% to 1.56%
and AUM has increased from 9,554.04 to 10,223.64 crores.
ICICI PRUDENTIAL MUTUAL FUND
1. ICICI Prudential Bluechip Fund (diversified – large cap)
- The primary investment objective of the scheme is to seek to generate long term
capital appreciation by investing predominantly into equity and equity related instruments
of large cap companies. This scheme is suitable for conservative investors looking for
higher returns and medium term goals like retirement planning and wealth creation.

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2. ICICI Prudential FMCG Fund (Sectoral fund)
- To generate long term capital appreciation through investments made primarily in
equity and equity related securities forming part of FMCG sector. In other words it is an
open ended equity scheme investing in FMCG sector.
3. ICICI Prudential Long Term Equity Fund (Tax Saving Fund / ELSS)
- An open ended equity linked saving scheme with a statutory lock in of 3 years and tax
benefit.
- It aims to generate long term capital appreciation by primarily investing in equity and
related securities and provides tax benefit under section 80C of income tax act,1961.
Table 4.3: Performance Analysis of Equity Schemes of ICICI Prudential Mutual

Fund

1 YEAR 3 YEAR (Cr.)
ICICI Prudential 2018 41.70 -0.71 17.51 19,823.27
Bluechip Fund
2019 42.61 -2.36 9.21 20,818.98
(diversified)
2020 45.66 8.59 10.14 24,245.79
ICICI Prudential 2018 241.91 7.44 17.82 509.77
FMCG Fund 2019 243.94 -2.56 10.23 486.21
(sectoral)
2020 259.35 5.35 12.52 497.40
ICICI Prudential 2018 366.25 -0.91 13.82 5,461.05
Long term equity 2019 382.24 -2.87 7.76 5,994.82
fund
(ELSS) 2020 407.73 9.33 9.01 6,550.48

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Graph 4.3: Graphical Representation of 3 yr return % of ICICI Prudential Mutual

Fund schemes
20.00
18.00
16.00
14.00
12.00
10.00 3 yr return% -
2018
8.00 3 yr return% -
2019
6.00
3 yr return% -
4.00 2020
2.00
0.00
ICICI Prudential ICICI Prudential ICICI Prudential
Bluechip Fund FMCG Fund Long Term Equity Fund
Interpretation :
 In ICICI Prudential Bluechip Fund, the performance of NAV has increased from
41.70 to 45.66 rupees, the 1 yr return % has decreased from -0.71% to
17.51% to 9.21% in 2019 but increased slightly to 10.14% in 2020 and AUM has increased
from 19,823.27 to 24,245.79 crores.
 In ICICI Prudential FMCG Fund, the performance of NAV has increased from 241.91
to 259.35 rupees, the 1 yr return % has decreased from 7.44% to -2.56% in 2019 but

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increased to 5.35% in 2020, the 3 yr return % has decreased from 17.82% to 10.23% in
2019 but increased to 12.52% in 2020 and AUM has decreased from 509.77 to 486.21
crores in 2019 but increased to 497.40 crores in 2020.
 In ICICI Prudential Long Term Equity Fund, the performance of NAV has increased
from 366.25 to 407.73 rupees, the 1 yr return % has decreased from -0.91% to -2.87% in
2019 but increased to 9.33% in 2020, the 3 yr return % has decreased from 13.82% to
7.76% in 2019 but increased to 9.01% in 2020 and AUM has increased from 5,461.05 to
6,550.48 crores.
UTI MUTUAL FUND

1. UTI Mastershare Fund (diversified – large cap)
- India’s first equity oriented fund launched in October 1986. The Fund invests in
leading businesses of large market capitalisation following Growth at Reasonable Price
(GARP) investment style. The Fund maintains a well-diversified portfolio and avoids
sector as well as stock concentration. The Fund has an impeccable track record of
uninterrupted dividend distribution every year since inception, regardless of bear and bull
phases of equity market.

FUND COMPANIES”
2. UTI MNC Fund (sectoral fund)
- The Fund predominantly invests in stocks of Multinational Corporations (MNCs).
The Fund endeavours to invest in companies which are characterized by low financial
leverage and has high potential to lead pricing in their respective sectors. The Fund
provides a differentiated portfolio of quality MNCs, typically not very commonly held by
pure diversified equity funds • The Fund exhibits long term performance track record, out-
performance over the benchmark with relatively lower volatility.
3. UTI Long Term Equity Fund (tax saving fund / ELSS)
- An Equity Linked Savings Scheme which provides tax deduction up to the limits
specified u/s 80C of the Income Tax Act, 1961 is eligible for deduction. The Fund attempts
to invest in businesses having healthy return ratios, cash flows and sound management,
with an aim to provide superior risk adjusted return. Shorter lock-in period of 3 years as
compared to other traditional tax saving instruments.
Table 4.4: Performance Analysis of Equity Schemes of UTI Mutual Fund

1 YEAR 3 YEAR (Cr.)
UTI Mastershare 2018 121.79 3.72 13.76 5,679.16
Fund
2019 120.63 -4.32 7.79 5,767.13
(diversified)
2020 132.84 10.47 10.79 6,430.89
UTI MNC Fund 2018 207.33 4.69 13.02 2,134.52
(sectoral) 2019 187.44 -12.95 4.75 1,974.86
2020 213.64 3.21 9.78 2,217.52
UTI Long Term 2018 87.39 -2.03 12.56 1,069.22
Equity Fund 2019 85.30 -7.16 5.92 1,121.29

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(ELSS) 2020 97.85 12.71 9.45 1,318.77
Graph 4.4: Graphical Representation of 3 yr return % of UTI Mutual Fund schemes
16.00
14.00
12.00
10.00
3 yr return% -
8.00 2018
6.00 3 yr return% -
2019
4.00 3 yr return% -
2020
2.00
0.00
UTI Mastershare Fund UTI MNC Fund UTI Long Term
Equity Fund
Interpretation:
 In UTI Mastershare Fund, the performance of NAV has decreased from 121.79 to
120.63 rupees in 2019 but increased to 132.84 rupees in 2020, the 1yr return % has reduced
from 3.72% to -4.32% in 2019 but increased to 10.47% in 2020, the 3 yr return % has
decreased from 13.76% to 7.79% in 2019 but increased to 10.79% in 2020 and AUM has
increased from 5,679.16 to 6,430.89 crores.

FUND COMPANIES”
 In UTI MNC Fund, the performance of NAV has decreased from 207.33 to 187.44
rupees in 2019 but increased to 213.64 rupees in 2020,the 1 yr return % has decreased from
4.79% to -12.95% in 2019 but increased to 3.21% in 2020, the 3 yr return% has decreased
from 13.02% to 4.75% in 2019 but increased to 9.78% in 2020 and AUM has decreased
from 2,134.52 to 1,974.86 crores in 2019 but increased to 2,217.52 crores in 2020.
 In UTI Long Term Equity Fund, the performance of NAV has decreased from 87.39
to 85.30 rupees in 2019 but increased to 97.85 rupees in 2020,the 1yr return % has
decreased from -2.03% to -7.16% in 2019 but increased to 12.71% in 2020, the 3 yr return
% has decreased from 12.56% to 5.92% in 2019 but increased to 9.45 in 2020 and AUM
has increased from 1,069.22 to 1,318.77 crores.
SBI MUTUAL FUND
1. SBI Bluechip Fund (diversified – large cap)
- SBI Blue Chip Fund aims to provide investors with opportunities for long-term
growth in capital through an active management of investments in a diversified basket of

FUND COMPANIES”
large cap equity. The fund invests a minimum of 80% in large cap stocks. Generally, Large
cap stocks are well established companies having good brand equity and are possibly
market leaders in their industries. SBI Blue Chip Fund has the flexibility to invest up to
20% in equities other than large caps or debt and/or money market instruments.
2. SBI Consumption Opportunities Fund (sectoral fund)
- SBI Consumption Opportunities Fund aims to provide investors with opportunities
for long-term capital appreciation by primarily investing in a diversified portfolio of equity
and equity related securities in consumption space.
3. SBI Long Term Equity Fund (tax saving fund / ELSS)
- The fund aims to provide investors with the benefit of investing in a portfolio of
equity shares, while offering deduction on such investments made in the scheme under
section 80C of the Income Tax Act, 1961. Investments in the scheme are subject to a
statutory lock-in of 3 years from the date of allotment.
Table 4.5: Performance Analysis of Equity Schemes of SBI Mutual Fund

1 YEAR 3 YEAR (Cr.)
SBI Bluechip 2018 39.08 -0.62 11.97 20,730.18
Fund
2019 40.08 -2.97 6.84 21,292.72
(diversified)
2020 43.14 11.69 9.25 22,962.88
SBI Consumption 2018 121.75 -1.54 17.31 708.90
Opportunities 2019 111.62 -11.89 7.87 643.62

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Fund (sectoral) 2020 128.45 4.58 13.33 689.36
SBI Long Term 2018 142.41 -3.93 11.41 6,585.41

Equity Fund 2019 138.28 -5.27 4.48 6,640.20
(ELSS)
2020 148.24 4.36 6.30 7,352.39
Graph 4.5: Graphical Representation of 3 yr return % of SBI Mutual Fund schemes
20.00
18.00
16.00
14.00
12.00
3 yr return% -
10.00 2018
8.00 3 yr return% -
2019
6.00
3 yr return% -
4.00 2020
2.00
0.00
SBI Bluechip Fund SBI Consumption SBI Long Term
Opportunities Fund Equity Fund
INTERPRETATION :
 In SBI Bluechip Fund, the performance of NAV has increased from 39.08 to 43.14
rupees, the 1 yr return % has decreased from -0.62% to -2.97% in 2019 but increased to

FUND COMPANIES”
11.69% in 2020, the 3 yr return % has decreased from 11.97% to 6.84% in 2019 but
increased to 9.25% in 2020 and AUM has increased from 20,730.18 to 22,962.88 crores.
 In SBI Consumption Opportunities Fund, the performance of NAV has decreased
from 121.75 to 111.62 rupees in 2019 but increased to 128.45 rupees in 2020, the 1 yr
return % has decreased from -1.54% to -11.89% in 2019 but increased to 4.58% in 2020,
the 3 yr return % has decreased from 17.31% to 7.87% in 2019 but increased to 13.33% in
2020 and AUM has decreased from 708.90 to 643.62 crores in 2019 but increased to
689.36 crores in 2020.
 In SBI Long Term Equity Fund, the performance of NAV has decreased from 142.41
to 138.28 rupees in 2019 but increased to 148.24 rupees in 2020, the 1 yr return % has
decreased from -3.93% to -5.27% in 2019 but increased to 4.36% in 2020, the 3 yr return %
has decreased from 11.41% to 4.48% in 2019 but increased to 6.30% in 2020 and AUM has
increased from 6,585.41 to 7,352.39 crores.
Graph 4.6: Graphical Comparison of AUM of all company’s Large Cap Funds

FUND COMPANIES”
30,000.00
25,000.00
20,000.00
15,000.00
10,000.00
5,000.00 AUM(2018)
AUM(2019)
0.00 AUM(2020)
ity nd nd un
d nd
Equ Fu Fu e F Fu
e ap hi
p
ar hi
p
tlin eC ec r sh ec
on g u lu
r ar Bl te IB
LF iaL tial as SB
S d en IM
AB In
ud UT
on Pr
ipp IC
I
N IC
Graph 4.7: Graphical Comparison of AUM of all company’s Sectoral Funds
4,500.00
4,000.00
3,500.00
3,000.00
2,500.00
2,000.00
AUM(2018)
1,500.00 AUM(2019)
1,000.00 AUM(2020)
500.00
0.00

FUND COMPANIES”
Graph 4.8: Graphical Comparison of AUM of all company’s ELSS Funds

12,000.00
10,000.00
8,000.00
6,000.00
4,000.00
2,000.00
0.00 AUM(2018)
6 d d d d AUM(2019)
f9 un un un un
elie er
F
ty
F
ty
F
ty
F AUM(2020)
R av ui ui ui
Tax S Eq Eq Eq
SL ax rm rm rm
AB iaT e Te e
In
d gT g gT
n Lon Lon Lon
o al I I
pp nti UT SB
Ni de
P ru
I
IC
IC
CHAPTER -5

FUND COMPANIES”
SUMMARY OF FINDINGS, CONCLUSIONS AND

SUGGESTIONS
Summary of Findings:
Diversified type
 Aditya Birla Sun Life Frontline Equity: NAV,1yr return % has increased, 3yr return
% has decreased and AUM slightly decreased.
 Nippon India Large Cap Fund: NAV, 1 yr return %, AUM has increased, 3 yr return
% decreased.
 ICICI Prudential Bluechip Fund: NAV, 1 yr return %, AUM has increased, 3 yr
return % decreased.
 UTI Mastershare Fund: NAV,AUM has increased, 1 yr return % and 3yr return % has
decreased in 2019 but increased in 2020.
 SBI Bluechip Fund: NAV,AUM has increased, 1 yr return % and 3yr return % has
Sector type
 Aditya Birla Sun Life MNC Fund: NAV, AUM, 1 yr return % and 3 yr return % have
all decreased in 2019 but increased in 2020.
 Nippon India Pharma Fund: NAV, AUM, 1 yr return % and 3 yr return % have all
 ICICI Prudential FMCG Fund: NAV has increased, AUM, 1 yr return % and 3 yr
return % have decreased in 2019 but increased in 2020.
 UTI MNC Fund: NAV, AUM, 1 yr return % and 3 yr return % have all decreased in
2019 but increased in 2020.
 SBI Consumption Opportunities Fund: NAV, AUM, 1 yr return % and 3 yr return %
have all decreased in 2019 but increased in 2020.

FUND COMPANIES”
Tax planning / ELSS type
 Aditya Birla Sun Life Tax Relief 96: NAV, AUM has increased, 1 yr return % and 3
yr return % have decreased in 2019 but increased in 2020.
 Nippon India Tax Saver Fund: NAV, AUM, 1 yr return % has increased and 3 yr
return % has decreased.
 ICICI Prudential Long Term Equity Fund: NAV, AUM has increased, 1 yr return %
and 3 yr return % has decreased in 2019 but increased in 2020.
 UTI Long Term Equity Fund: : NAV, AUM has increased, 1 yr return % and 3 yr
return % has decreased in 2019 but increased in 2020.
 SBI Long Term Equity Fund: AUM has increased, NAV, 1 yr return %, 3 yr return %
have decreased in 2019 but increased in 2020.
Suggestions
 Based on data analysis of the diversified large cap type of funds, ABSL Frontline
Equity has higher NAV compared to others, the 1yr return % is greater for UTI
Mastershare Fund, Nippon India Large Cap Fund and ICICI Prudential Bluechip Fund has
better 3yr return % ; ABSL, ICICI Prudential and SBI funds have high AUM’s.
 Based on data analysis of the sectoral type of funds, ABSL MNC Fund has higher
NAV compared to others, Nippon India Pharma Fund and ICICI Prudential FMCG Fund
has greater 1 yr return %, ICICI Prudential FMCG Fund and SBI Consumption
Opportunities Fund has better 3yr return % ; ABSL MNC Fund has higher AUM compared
to others.
 Based on data analysis of the tax planning / ELSS type of funds, ICICI Prudential
Long Term Equity Fund has higher NAV compared to others, the 1yr return % is greater
for ICICI Prudential Long Term Equity Fund, ABSL Tax Relief 96 has better 3 yr return %
compared to others ; Nippon India Tax Saver Fund and ABSL Tax Relief 96 have high
AUM’s.

FUND COMPANIES”
 In diversified type of funds, Nippon India Large Cap Fund, ICICI Prudential Bluechip
Fund and UTI Mastershare Fund has higher and consistent rate of returns.
 In sectoral type of funds, ICICI Prudential FMCG Fund has higher and more
consistent returns compared to others.
 In tax planning type of funds, ABSL Tax Relief 96 and ICICI Prudential Long Term
Equity Fund has higher and more consistent returns compared to others.
 AUM alone should not be a factor for selection of equity mutual funds. Here,
consistency in returns and compliance of the fund house with the investment mandate
matters more than AUM. By consistency, we mean beating the benchmark throughout the
market highs and lows. Hence, an equity fund runs on the asset manager’s skill to generate
good returns consistently rather than popularity or size. For example a company with lesser
AUM can have higher returns when compared to a company with higher AUM.
 From the data, we found that the performance of schemes during the year 2019 is
lower than the other two years. This can be due to many negative market factors which
cannot be specifically pointed out.
 The first point to analyse before investing in a fund is to find out whether objective
matches with the scheme. If there is a mismatch in the scheme the investors would be
affected with the probable returns.
 The investors with low risk tolerance should invest in small and mid cap schemes as
they are relatively safer when compared to schemes like equity. Aggressive investors can
go for equity investments and can opt for schemes that invest in specific industry or sector.
 Investors should go through schemes track record, performance against relevant
market benchmarks and its competitors.
 Investors should look at the expense ratio of the fund before investing. This is
because money is deducted from the returns.
 Investors should continuously monitor their portfolio and revise by updating
according to market position, so that their returns can be maximised.
 Investors should look for top performing assets and focus on funds latest
performance.

FUND COMPANIES”
 First time mutual fund investors are advised to go small on their investments.
Investors should invest in small and mid cap companies and wait for the returns and once
they are satisfied they should go for diversification of the funds.
 When markets are up it is advisable to invest in tax saver funds, which are giving
good returns compared to many other schemes.
 Mutual fund is a trust that pools the money of several investors and manages
investments on their behalf. The fund collects this money from investors through various
schemes. Each scheme is differentiated by its objectives of investments or in other words a
broadly defined purpose of how the collected money is going to be involved.
 Investors invest in mutual fund due to following advantages: they have professional
management, diversification, convenient administration, return potential, low cost,
liquidity, etc..
 Mutual funds are affordable for most individuals. The market is growing day by day
and websites provide the investor with much information. Investing has become easier with
the introduction of technology.
 The good performance of the economy and stock markets in the last couple of years
contributed to the growth of the mutual funds.
 For the rapid development in economy SEBI should encourage the rural investor
through post office and banks.

FUND COMPANIES”
Conclusion:-
AUM is a crucial factor to consider if you are planning to invest in debt funds. A debt fund
with more capital under it can spread the fixed fund expenses across the number of
investors. This can reduce the expense ratio per person and hence increase the fund returns.
More assets under the fund also help the fund company to negotiate reasonable rates with
debt issuers. NAV also is not a major factor for selection of equity funds. When the amount
of investment in different schemes is the same, the NAV’s are irrelevant. What an investor
needs to closely look at are the returns given by the scheme.1 yr return % can be deceiving
because companies which have lower return % for one year can have greater returns over 3
or 5 years. Therefore the true performance of a mutual fund can only be determined over
multiple years. If investors are looking to invest in equity funds they should consider long
term gains rather than short term because equity funds generate more returns in the long
run. Investors should choose funds which generate higher and more consistent returns over
the years.

FUND COMPANIES”
BIBLIOGRAPHY
Books
 LM. Bhole (2007): “Financial Institutions and Markets” TMH Publications.
 B. V. Pathak (2010): “Indian Financial System” Pearson Education Publications.
 Sundar Sankaran : “Indian Mutual Funds Handbook” (5th Edition), Vision Books.
Websites
www.investopedia.com,
mutualfund.adityabirlacapital.com,
www.nipponindiamf.com,
www.icicipruamc.com,
www.utimf.com,
www.sbimf.com,
www.valueresearchonline.com,
www.mutualfundindia.com,
www.amfiindia.com

BBA Final Year Project (Finance) Christy Thomas 17PUC26084

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“COMPARATIVE STUDY ON EQUITY SCHEMES OF VARIOUS MUTUAL

About Mutual Funds

comprising of stocks, bonds or money market instruments in accordance with the

expected to come into Indian markets in the near future.

Acharya Institute of Graduate Studies Page 1

services and customized plans.

Acharya Institute of Graduate Studies Page 2

Definition of Mutual Fund

1. A mutual fund is a professionally-managed investment scheme, usually run by an asset

2. A mutual fund is a type of financial vehicle made up of a pool of money collected from

Features of Mutual Funds

Acharya Institute of Graduate Studies Page 3

Advantages of Mutual Fund

Acharya Institute of Graduate Studies Page 4

Disadvantages of Mutual Funds

Acharya Institute of Graduate Studies Page 5

1. High Expense Ratios and Sales Charges

4. Poor Trade Execution

Classification of Mutual Funds

Based on the maturity period:

Acharya Institute of Graduate Studies Page 6

Based on investment objectives:

Acharya Institute of Graduate Studies Page 7

Important key words related to mutual funds:

Acharya Institute of Graduate Studies Page 8

1. Sapar & Narayan(2003)

a sample of 269 open ended schemes (out of total schemes of 433).

fund schemes into six distinct investment styles.

3. Agrawal Deepak & Patidar

is to provide an overview of mutual fund activity in emerging markets, to describe their

Acharya Institute of Graduate Studies Page 9

affects the performance of the MF industry in India.

4. Mehta Sushilkumar (2010)

5. Mr. Vijay Anand (2000)

Acharya Institute of Graduate Studies Page 10

the best alternative to assess the performance.

7. Dr S Narayan Rao (2002)

systematic risk and total risk.

8. Dr. S. Anand & Dr. V Murugaiah (2003)

Acharya Institute of Graduate Studies Page 11

underperformance in comparison with risk free return.

Need for the study:

impacts the investment decisions of the public.

Objectives of the study:

 To know and explain equity schemes in brief

of return and other factors.

MF, ICICI Prudential MF, SBI, UTI.

 To give brief idea about mutual funds available in India .

 To give an idea about the schemes available.

 To give idea about the regulation of mutual fund.

Acharya Institute of Graduate Studies Page 12

Scope of the study:

give suggestions for better investment options.

mutual funds such as equity schemes.

Operational definitions of the concepts:

1. Net Asset Value(NAV)

2. Assets Under Management (AUM)

new assets (NNA) inflow/(outflow) and structural effects of the company.

3. Diversified Equity Funds

Acharya Institute of Graduate Studies Page 13

- A diversified equity fund invests in companies regardless of size and sector. It

4. Sector Specific Funds

5. Tax Planning Funds / Equity Linked Savings Scheme (ELSS)