Preeti Singh PDF Final Project

CHAPTER I
INTRODUCTION TO INVESTMENT PATTERN OF PUBLIC

SECTOR BANKING EMPLOYEES IN NAVI MUMBAI.
Public Sector Banks (PSBs) are a major type of bank in India, where a majority stake (i.e. more
than 50%) is held by a government. The shares of these banks are listed on stock exchanges. There
are a total of 12 Public Sector Banks alongside 1 state-owned Payments Bank in India.
1.1 HISTORY:
❖ Emergence of public sector banks

The Central Government entered the banking business with the nationalization of the Bank of
India in 1955. A 60% stake was taken by the Reserve Bank of India and the new bank was named
as the State Bank of India .The seven other state banks became the subsidiaries of the new bank in
1959 when the State Bank of India (Subsidiary Banks) Act, 1959 was passed under the Nehru
government. The next major government intervention in banking took place on 19 July 1969 when
the Indira Gandhi government nationalised an additional 14 major banks. The total deposits in the
banks nationalised in 1969 amounted to 50 crores. This move increased the presence of nationalised
banks in India, with 84% of the total branches coming under government control.
❖ Before the economic liberalization

The share of the banking sector held by the public banks continued to grow through the 1980s, and
by 1991 the public sector banks accounted for 90% of the banking sector. A year later, in March,
1992, the combined total of branches held by public sector banks was 60,646 across India, and
deposits accounted for ₹1,10,000 crore. The majority of these banks were profitable, with only one
out of the 21 public sector banks reporting a loss.
❖ Liberalisation in the 2000s

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The nationalised banks reported a combined loss of ₹1160 crores. However, the early 2000s saw a
reversal of this trend, such that in 2002-03 a profit of ₹7780 crores by the public sector banks: a
trend that continued throughout the decade, with a ₹16856 crore profit in 2008-2009 of India on
August 27, 2010. The remaining 27 nationalised banks were merged into 12 banks from 2017-19.
The State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of Mysore State Bank of
Patialaand State Bank of Travancore, and BharatiyaMahilaBank were merged with State Bank of
India with effect from 1 April 2017. Vijaya Bank and Dena Bank were merged into Bank of Baroda
in 2018. IDBI Bank was categorised as a private bank with effect from January 2019.
On 30 August 2019, Finance Minister Nirmala Sitharaman announced the government's plan for
further consolidation of public sector banks: Indian Bank is to be merged with Allahabad
Bank (anchor bank - Indian Bank); PNB, OBC and United Bank are to be merged (anchor bank
- PNB); Union Bank of India, Andhra Bank and Corporation Bank are to be merged (anchor bank
- Union Bank of India); and Canara Bank and Syndicate Bank are to be merged (anchor bank
- Canara Bank)
1.2DIFFERENT LEVELS AND POSTS IN PUBLIC SECTOR BANKS

Banking is a very lucrative sector and banking jobs are today among the most sought-after jobs by
youth and even several students opt to study Banking oriented courses are different types of banks
in India. Banking job provides good pay and perks. It also provides rapid growth and job
satisfaction.
The following the managerial hierarchy in nationalized bank in india:
FROM TOP TO BOTTOM:
1. CHAIRMAN AND MANAGING DIRECTOR :

❖ Provides leadership and governance of the Board so as to create the conditions for overall
Board’s and individual Director’s effectiveness, and ensures that all key and appropriate
issues are discussed by the Board in a timely manner
❖ Promotes effective relationships and open communication, and creates an environment that
allows constructive debates and challenges, both inside and outside the boardroom, between
Non-executive Directors and the management
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❖ Ensures that the Board as a whole plays a full and constructive part in the development and
determination of the Group’s strategies and policies, and that Board decisions taken are in
the Group’s best interests and fairly reflect Board’s consensus
2.EXECUTIVE DIRECTOR :
❖ The role of the executive director is to design, develop and implement strategic plans for
the organization in a manner that is both cost and time-efficient.
❖ The executive director is also responsible for the day-to-day operation of the organization,
which includes managing committees and staff as well as developing business plans in
collaboration with the board.
❖ In essence, the board grants the executive director the authority to run the organization. The
executive director is accountable to the chairman of the board of directors and reports to
the board on a regular basis – quarterly, semiannually, or annually.
3.CHIEF GENERAL MANAGER :
1.( ONLY IN LARGE BANKS )- TOP EXECUTIVE- SCALE VIII:
❖ Establish and carry out departmental or organizational goals, policies, and procedures
❖ Direct and oversee an organization’s financial and budgetary activities
❖ Manage general activities related to making products and providing services
2..GENERAL MANGER- EXECUTIVE – SCALE VII:
❖ Managing the performance of each employee.

❖ Sustaining current market position and growing market share.
❖ Creating business plans to support the company’s financial objectives.
3.DEPUTY GENERAL MANAGER – EXECUTIVE –SCALE VI:
❖ Monitor work of all repairers and attorneys and ensure quality of all processes and evaluate all
facilities and recommend improvements to same.
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❖ Monitor and recommend amends for all company operation manual and ensure compliance to
all departments and government regulations.
❖ Design all departmental targets and evaluate all staff performance at various meetings and
develop and implement an efficient staff training programs as per requirement.
4.ASSISTANT GENERAL MANAGER –SENIOR MANAGEMENT – SCALE V:
❖ Supervise employees, making sure they follow regulations and meet customer service
standards.
❖ Work to realize financial objectives by motivating staff and implementing marketing
strategies.
❖ Schedule employee shifts and administer payroll.
5..DIVISIONAL MANAGER / CHIF MANAGER- SENIOR MANAGEMENT – SCALE IV:
❖ Directing all operational aspects including distribution, customer service, human resources,
administration and sales in accordance with the bank's objectives
❖ Providing training, coaching, development and motivation for bank personnel
❖ Developing forecasts, financial objectives and business plans
6.SENIOR MANAGER – MIDDLE MANAGEMENT – SCALE III:
❖ Planning, organizing, directing, and evaluating all business activities, ensuring they meet
the organization’s goals, objectives, and regulations.
❖ Monitoring budgets and progress for all projects and activities.
❖ Developing, implementing, and updating procedures and policies.
7.MANAGER – MIDDLE MANAGEMENT – SCALE II:
❖ A Bank Manager’s primary task is to provide leadership to their banking staff, provide a
high level of service and to increase the performance of their bank branch.
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❖ Their role is very key, as they bear the responsibility of their bank branch’s performance
and success.
❖ To ensure that their branch is performing at an exceptional level, Bank Managers must have
expert knowledge of every aspect of their branch’s operations.
8. OFFICER – JUNIOR MANAGEMENT – SCALE I:
❖ General duties include monitoring the operations for correct accounting procedures,
approving loan packages, and developing relationships with banking customers.
9.CLERK – SCALE “0”:
❖ Process Customer Transactions.

❖ Answer Visitor Questions.
❖ Direct Customers to Bank Personnel,
1.3COMPENSATION AND INCENTIVES:
The bank employees’ salary range is set as per the recommendations of the pay commission. Being
an employee in a bank is considered as a prestigious profession due to the nature of the job as well
as the salaries that the bankers command.
As per the latest update released in October 2019, on the Wage Settlement of the Bank employees,
it has been decided that the employees can claim a part wage arrear before the wage settlement
agreement reaches a certain conclusion. The part wage arrear is like Diwali bonanza for the
employees of public sector banks as there is a 12% wage revision amounting to a sum of close Rs.
50,000/- to Rs.100000/-.
I .Bank PO Salary:
The Bank PO salary has many inclusive advantages along with the basic pay .For this reason,
aspirants seeking jobs in the banking sector, find the PO (Probationary Officer) post as the most
sought-after job with fruitful career growth option. A Probation officer (PO) is an Assistant
Manager of Scale I in the bank
.The Indian bank PO salary varies for various posts like :
1.Bank PO salary for SBI.
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2.Bank PO salary for IBPS.
1.SBI PO Salary:
The State Bank of India is reputed to have the highest salary range among the public banks in
India.The SBI Exams are conducted to recruit candidates into various revered posts under the State
Bank of India.Every year lakhs of candidates appear for the SBI PO exam to get into the banking
sector. The SBI PO exam is conducted to recruit probationary officers for SBI. The SBI PO salary
structure is as follows:
• As per the SBI PO salary structure, the basic pay is set at Rs. 27,620/- with 4 advance
increments.
• The minimum compensation per annum is Rs. 7.55 lakhs, the maximum compensation is
Rs. 12.93 lakhs, and it depends on the place of posting and the other factors.
• In the annual package of SBI PO salary, the various inclusions are basic salary, city
compensatory allowance, Tax & PPF, dearness allowance, petrol, food allowance,
compensation for bank stationery & accommodation is provided if it is available at the place
of your posting.
2.IBPS PO Salary:
The Institute of Banking personnel Selection is the recruiting body for various IBPS bank
exams.The public sector banks follow the IBPS salary structure which is different from the SBI
salary structure.These IBPS exams are for candidates trying to get a good and secured job in the
Public banking domain.The following paragraphs cover the IBPS PO salary in public sector
banks.The IBPS PO exam is used to select probationary officers for PSBs.The following is the
IBPS PO salary structure: The basic pay component of IBPS PO salary is Rs.23,700/- per month.
• In the IBPS PO salary, there are other allowances such as special allowance, dearness
allowance and HRA, the total compensation is Rs. 38703.38 per month.
• The gross annual CTC including HRA but without leased accommodation, it is Rs.
5,57,640.52.
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II .Bank Clerk Salary:
The bank clerk salary varies with respect to different banks .Salary for the following are discussed:
1. Bank Clerk Salary – SBI.

2. The Bank Clerk Salary- IBPS.
1.SBI Clerk Salary:

The SBI Clerk salary has a pay scale is as follows:
Rs. 11765-655/3-13730-815/3-16175-980/4-20095-1145/7-28110-2120/1-30230-1310/1- 31540.
The SBI Clerk salary structure will be Including the dearness allowance, house rent allowance and
other allowance the starting salary is Rs. 20,950/- per month.
Candidates should clear the SBI clerk exam to get into this post under the State bank of India.
2.IBPS Clerk Salary:
The IBPS(Institute of banking personnel selection ) Clerk CWE exam is conducted on two levels-
preliminary exam and mains .Candidates aspiring for clerk post under the IBPS need to clear
the IBPS Clerk Exam.
The IBPS Clerk salary structure is as follows:
• The basic IBPS clerk salary is Rs 11,765- Rs 42,020 per month.

• Rs 11,765 is the basic pay in the IBPS clerk salary and the remaining pay includes dearness
allowance, house rent allowance, medical allowance and transport allowance.
• The cash in hand with regard to the IBPS Clerk salary is Rs 19,461 for those who join
initially.
• Increments are based on performance and length of service.
III .IBPS RRB Salary:

The IBPS RRB bank post has divisions such as office assistants, officer scale I, II & III. Below are
the salary structure for these posts.The Institute of Banking Personnel Selection conducts the IBPS
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RRB Exam to recruit officers who will head the various Regional Rural Banks (RRB) across the
country.
The IBPS RRB salary details are as follows:
The salary structure for office assistant is in the range of Rs. 7200-400/3-8400-500/3-9900-600/4-
12300-700/7-17200-1300/1-18500-800/1-19300. Rs 19000- Rs 22000 is the cash in hand for new
joiners.
The IBPS RRB salary details as per the various officer scale are given below:
IBPS RRB salary- officer scale IBPS RRB salary- Cash in hand
Officer Scale I Rs 30000- Rs 36000
Officer Scale-II Rs 36000- Rs 42000
Officer Scale III Rs 41000- Rs 47000
IV.Bank SO Salary:
The bank Specialist officer(SO) salary varies from bank to bank.
The bank SO salary for the various banks are as follows:
1.SBI SO Salary:
The State Bank of India Specialist officer (SO) has two scales.
They are:
1. Junior Management Grade Scale (JMGS) I

2. Middle Management Grade Scale (MMGS) II
The following are the pay scales for these grades:
• For junior management grade scale I, the bank salary structure is Rs.23700-980/7-30560-
1145/2-32850-1310/7-42020 and 73600 is inclusive of leased rental at Mumbai.
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• For middle management grade scale II, the bank salary structure is Rs.31705-1145/1-
32850-1310/10-45950 and 90700 is inclusive of leased rental at Mumbai.
2.IBPS SO Salary
The IBPS SO salary covers pay scales of Officer Scale I, Officer Scale-II, Officer Scale-III. The
IBPS SO exam is to recruit candidates into Specialist Officers Post under the Institue of Banking
Personnel Selection. The IBPS SO salary details are as follows:
• The salary structure of Officer Scale I is in the range of Rs. 23700-980/7-30560-1145/2-

32850-1310/7-42020. They get around 36400/- per month including dearness allowance
and HRA.
• The salary structure of Officer Scale-II is in the range of Rs. 31705-1145/1-32850-1310/10-

45950. Rs. 48800/- is the basic pay per month including dearness allowance and HRA.
• The salary structure of Officer Scale III is in the range of Rs. 42020-1310/5-48570-1460/2-
51490. Rs. 64600/- is the total compensation per month including dearness allowance and
HRA.
Performance-linked incentives (PLI) is set to become the buzzword for about eight lakh public
sector bank employees which they may receive from the next fiscal over and above of their revised
salary which is under negotiation at present.This is a major shift from managements insistence on
variable pay, or performance-linked pay, which was earlier proposed as part of wage increase.
The Indian Banks Association’s (IBA) wage negotiation committee has come up with this proposal
last Friday and leading bank unions negotiating wage revision have readily accepted it in-principle,
according to three people familiar with the development.
1.4.Various investments option open for employees :
Most investors want to make investments in such a way that they get sky-high returns as fast as
possible without the risk of losing the principal money. This is the reason why many investors are
always on the lookout for top investment plans where they can double their money in few months
or years with little or no risk .However, it is a fact that investment products that give high returns
with low risk do not exist. In reality, risk and returns are inversely related, i.e., higher the returns,
higher is the risk, and vice versa.
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So, while selecting an investment avenue, you have to match your own risk profile with the risks
associated with the product before investing. There are some investments that carry high risk but
have the potential to generate high inflation-adjusted returns than other asset class in the long term
while some investments come with low-risk and therefore lower returns .There are two buckets
that investment products fall into - financial and non-financial assets. Financial assets can be
divided into market-linked products (like stocks and mutual funds) and fixed income products (like
Public Provident Fund, bank fixed deposits). Non-financial assets - most Indians invest via this
mode – the likes of gold and real estate.
Here is a look at the top 10 investment avenues Indians employees look at while savings for their
financial goals.
1.Direct equity :
Investing in stocks may not be everyone's cup of tea as it's a volatile asset class and there is no
guarantee of returns. Further, not only is it difficult to pick the right stock, timing your entry and
exit is also not easy. The only silver lining is that over long periods, equity has been able to deliver
higher than inflation-adjusted returns compared to all other asset classes. At the same time, the risk
of losing a considerable portion of capital is high unless one opts for stop-loss method to curtail
losses. In stop-loss, one places an advance order to sell a stock at a specific price. To reduce the
risk to certain extent, you could diversify across sectors and market capitalisations. Currently, the
1-, 3-, 5 year market returns are around 13 percent, 8 percent and 12.5 percent, respectively. To
invest in direct equities, one needs to open a demat account.
2.Equity mutual funds
Equity mutual funds predominantly invest in equity stocks. As per current Securities and Exchange
Board of India (SEBI) Mutual Fund Regulations, an equity mutual fund scheme must invest at least
65 percent of its assets in equities and equity-related instruments. An equity fund can be actively
managed. In an actively traded fund, the returns are largely dependent on a fund manager's ability
to generate returns. Index funds and exchange-traded fund (ETFs) are passively managed, and these
track the underlying index. Equity schemes are categorised according to market-capitalisation or
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the sectors in which they invest. They are also categorised by whether they are domestic (investing
in stocks of only Indian companies) or international (investing in stocks of overseas companies).
3.Debt mutual funds

Debt funds are ideal for investors who want steady returns. They are less volatile and, hence, less
risky compared to equity funds. Debt mutual funds primarily invest in fixed-interest generating
securities like corporate bonds, government securities, treasury bills, commercial paper and other
money market instruments. Currently, the 1-, 3-, 5-year market return is around 6.5 percent, 8
percent, and 7.5 percent, respectively. Read more about debt mutual fund
Investment Options in India
4.National Pension System(NPS)
The National Pension System (NPS) is a long term retirement - focused investment product
managed by the Pension Fund Regulatory and Development Authority (PFRDA). The minimum
annual (April-March) contribution for an NPS Tier-1 account to remain active has been reduced
from Rs 6,000 to Rs 1,000. It is a mix of equity, fixed deposits, corporate bonds, liquid funds and
government funds, among others. Based on your risk appetite, you can decide how much of your
money can be invested in equities through NPS .
5. Public Provident Fund (PPF)
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The Public Provident Fund (PPF) is one product a lot of people turn to. Since the PPF has a long
tenure of 15 years, the impact of compounding of tax-free interest is huge, especially in the later
years. Further, since the interest earned and the principal invested is backed by sovereign guarantee,
it makes it a safe investment
6. Bank fixed deposit (FD)
A bank fixed deposit (FD) is a safe choice for investing in India. Under the deposit insurance and
credit guarantee corporation (DICGC) rules, each depositor in a bank is insured up to a maximum
of Rs 1 lakh for both principal and interest amount. As per the need, one may opt for monthly,
quarterly, half-yearly, yearly or cumulative interest option in them. The interest rate earned is added
to one's income and is taxed as per one's income slab
7. Senior Citizens' Saving Scheme (SCSS)
Probably the first choice of most retirees, the Senior Citizens' Saving Scheme (SCSS) is a must-
have in their investment portfolios. As the name suggests, only senior citizens or early retirees can
invest in this scheme. SCSS can be availed from a post office or a bank by anyone above 60. SCSS
has a five-year tenure, which can be further extended by three years once the scheme matures.
Currently, the interest rate that can be earned on SCSS is 8.3 per cent per annum, payable quarterly
and is fully taxable .
8. RBI Taxable Bonds
The government has replaced the erstwhile 8 percent Savings (Taxable) Bonds 2003 with the 7.75
per cent Savings (Taxable) Bonds. These bonds come with a tenure of 7 years. The bonds may be
issued in demat form and credited to the Bond Ledger Account (BLA) of the investor and a
Certificate of Holding is given to the investor as proof of investment. Read more about RBI Taxable
Bonds.
9.Real Estate
The house that you live in is for self-consumption and should never be considered as an investment.
If you do not intend to live in it, the second property you buy can be your investment. The location
of the property is the single most important factor that will determine the value of your property
and also the rental that it can earn. Investments in real estate deliver returns in two ways - capital
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appreciation and rentals. However, unlike other asset classes, real estate is highly illiquid. The other
big risk is with getting the necessary regulatory approvals, which has largely been addressed after
coming of the real estate regulator.
10.Gold
Possessing gold in the form of jewellery has its own concerns like safety and high cost. Then
there's the 'making charges', which typically range between 6-14 per cent of the cost of gold (and
may go as high as 25 percent in case of special designs). For those who would want to buy gold
coins, there's still an option. One can also buy ingeniously minted coins. An alternate way of
owning paper gold in a more cost-effective manner is through gold ETFs. Such investment (buying
and selling) happens on stock exchange with gold as underlying asset.
11.Corporate debenture
Corporate debentures are normally backed by the reputation and general creditworthiness of the
issuing company. It is a type of debt instrument that is not covered by the security of physical assets
or collateral. Debentures are a method of raising credit for the company and although the money
thus raised as a part of the company's capital structure, it is not part of the share capital.
12.Post office savings
Post Office Monthly Income Scheme is a low risk saving instrument, which can be availed through
any Post Office. The interest rate on deposits is slightly higher than banks. The interest is calculated
half yearly and paid yearly.
1.5 NAVI MUMBAI BRANCHES OF PUBLIC SECTOR BANK
The following are the list of public sector bank in navi Mumbai:
1.STATE BANK OF INDIA , PANVEL .
2..VIJAYA BANK , NEW PANVEL .
3.INDIAN BANK , KALAMBOLI .
4.ORIENTAL BANK OF COMMERCE , KHARGHAR .
5.RAIGAD DISTRICT CENTRAL CO-OPERATION BANK , NEW PANVEL .

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6.UCO BANK , KHARGHAR .
7.RATANAKAR BANK LTD , NERUL.
8.INDIAN OVERSEAS BANK ,VASHI .
9.CANARA BANK , KHARGHAR .
10.CORPORATION BANK , VASHI .
11.DENA BANK , AIROLI .
12.KARNATAKA BANK , BELAPUR .
13.BANK OF INDIA , NERUL .
14.BANK OF MAHARASHTRA,NEW PANVEL .
15.LAXMI VILAS BANK , KHARGHAR .
16.BANK OF BARODA ,KAMOTHE.
17.UNION BANK OF INDIA , NEW PANVEL .
18.ANDHRA BANK ,NERUL .
19.SARASWAT CO-OPERATIVE BANK ,SANPADA.
20.ALLAHABAD BANK, BELAPUR .
1.6 NAVI MUMBAI :
Navi Mumbai is a planned satellite city of Mumbai on the west coast of Maharashtra in India. It
was developed in 1972 as a new urban township of Mumbai, and is currently the largest planned
city in the world.
HISTORY :
Navi Mumbai, located in the eastern harbour of Mumbai, is one of the world's largest planned
townships. Since independence there was a specific reason to build a new city on the mainland
across the harbour: to lower the population of Mumbai, an island city whose physical expansion
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had a limit. It was regarded as an alternative for the many people who wanted to come to Mumbai
from all over India. This decision required the Maharashtra government to relocate its seat of
governance along with all its important offices to this new city, and completely stop the backbay
reclamation project in the island city. It did not do this. It continued with the reclamation and put
brakes on the efforts of CIDCO (such as the shifting of wholesale markets).
PLANNED CITY :
Planning of Navi Mumbai did not fully begin until 1971. South Navi Mumbai is being quickly
developed with modern infrastructure in parts of Kharghar, Kamothe, New Panvel and Kalamboli.
CIDCO DEVELOPMENT:
The City and Industrial Development Corporation (CIDCO) was formed on 17 March 1971, under
the Indian Companies Act, 1956. The area covered 150 kilometres (93 mi) of the total 720
kilometres (450 mi) of the Konkan coast. Privately owned land with 86 villages covering 15,954
hectares (39,420 acres) within the present limits of Navi Mumbai and further villages measuring
an additional 2,870 hectares (7,100 acres) were acquired by the government of Maharashtra.
CIDCO carved out 16 nodes small townships with a view towards facilitating comprehensive
development. These nodes are named Airoli, Ghansoli, Kopar Khairane, Juhu
Nagar, Vashi,Turbhe, Sanpada, Nerul, CBD Belapur, Kharghar, Kamothe, New Panvel, Taloja,
Kalamboli, Ulwe, and Dronagiri. CIDCO acquired 193.94 square kilometres (74.88 sq mi) of land,
of which 141.05 square kilometres (54.46 sq mi) was private land, 22.92 square kilometres
(8.85 sq mi) salt-pan land and 52.89 square kilometres (20.42 sq mi) government land. By 2000,
CIDCO had developed about 117.60 square kilometres (45.41 sq mi) of land. Of this land, 54.45
square kilometres (21.02 sq mi) is saleable under various land uses. CIDCO has sold about 21.90
square kilometres (8.46 sq mi) leaving a balance land for sale about 32.58 square kilometres
(12.58 sq mi) under various land uses. CIDCO planned and constructed all the railway stations in
Navi Mumbai and developed nearby areas commercially.
Recent Developments:
By the end of the 1990s, the planning authority of Navi Mumbai started private participation in the
developmental activity of Navi Mumbai.A new railway line between Nerul and Uran is under
construction. Kharghar and Panvel are experiencing major infrastructural developments due to
their being close to the proposed Navi Mumbai International Airport.
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ADMINISTRATION:
When Navi Mumbai was created in 1970s, CIDCO was the only authority that looked after the
development and maintenance of the city. CIDCO made a developmental plan for Navi Mumbai
covering 95 villages
For the first ten years of the project CIDCO was the planning and administrative body, and as the
developer and builder for the project. Taxes on property, land, commercial and water were payable
to CIDCO. The 14 nodes which CIDCO created were named Airoli, Ghansoli, Kopar Khairane,
Juhu Nagar, Vashi,Turbhe, Sanpada, Nerul, CDB Belapur, Kharghar, Kamothe, New Panvel,
Kalamboli, Ulwe, Pushpak and Dronagiri. Each of the nodes is divided into smaller groups called
sectors.
Initially only Juhu Vashi, Nerul and CBD Belapur were developed by CIDCO with housing,
schools and community centre roads. But after the arrival of the harbour railway line extension in
1990s, there was an increase in population. CIDCO shifted its development plan to nodes like
Kharghar, Kamothe, New Panvel, and Kopar Khairane. In its new development plan, CIDCO land
was allocated to builders for housing. CIDCO only provided basic infrastructure like roads, water
and electricity, these nodes were developed mostly by private builders according to the CIDCO
plan.
STATISTICS:
As per provisional reports of Census India, population of Navi Mumbai as of 2011 is 1,119,477;
of which male and female are 611,501 and 507,976 respectively. Although Navi Mumbai city has
population of 1,119,477; its urban population is 18,414,288 of which 9,894,088 are males and
8,520,200 are females.In education section, total number of literates in Navi Mumbai city are
911,542 of which 519,257 are males while 392,285 are females. Average literacy rate of Navi
Mumbai city is 91.57 percent of which male and female literacy was 95.05 and 87.33 percent. The
sex ratio of Navi Mumbai city is 831 females per 1000 males. Child sex ratio is 901 girls per 1000
boys
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CHAPTER II
RESEARCH METHODOLOGY.
2.1 OBJECTIVE OF THE STUDY:
The purpose of analysis is to determine the investment behaviour of public sector banking
employees and investment preferences for the same .
• To study the growth and development of various investment opportunities

• To study the awareness and pattern of investment among the bank employees .
• To analyze factors influencing investment decisions of public sector banking employees .
• To evaluate the risk and return on investment .
• To examine various problems faced by the employees while investing .
• To suggest suitable measures for improving profitable and safe investment
2.2 HYPOTHESIS:
• Hypothesis 1:
• H1: Ho: There is significant relationship between the income of the respondents and
investment made by the respondents .
• Ho: There is no significant relationship between the income of the respondents and
investment made by the respondents .
• Hypothesis 2:
• H2: Ho: There is significant relationship between demographic factors of the respondents
and the basis of investment made by the respondents
• Ho: There is no significant relationship between demographic factors of the respondents
and the basis of investment made by the respondents .
• Hypothesis 3:
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• H3:Ho: There is significant association between income category and basis of investment
of the respondents
• Ho : There is no significant association between income category and basis of investment
of the respondents .
• Hypothesis 4:
• H4:Ho: There is significant associations between investment category and basis of
investment of the respondents
• Ho: There is no significant associations between investment category and basis of
investment of the respondents.
2.3 SCOPE OF STUDY:
Every human being has a tendency to have a social status in the society. To obtain or maintain the
status, they are in need of money. This can be achieved through proper savings and channeling
their savings into a variety of investments. There are different types of portfolios available to the
investors based on the risk and return. This study focuses on the various investment opportunities
available, aiding the investors to divert a portion of their income into proper investment, thereby
benefiting the individual and thereby the growth of the economy of the country. To analyze the
pattern of investmen, bank employees are taken into consideration. Bank employees have wider
knowledge on the financial sector as almost all the banks have started their financial services in
terms of investments from the public. Therefore, bank employees have better clarity and experience
in this field. This study analyzes the awareness among bank employees and the types of investments
made by them.
2.4 SIGNIFICANCE OF THE STUDY:
The understanding of the relationship between the savings and investment pattern is essential as
savings forms the basis for the development of the economy. If the savings and investment pattern
among the households is good, then it results in the development of both money and capital market
and in turn the economy.
The present study is an empirical study to identify the extent, nature and preferences of the
investors in Navi Mumbai and to ascertain their investment habits. The study area is featured by a
good number of salaried employees belonging Government sector and these employees have the
ability to save and invest. This study will help the salaried class employees to plan savings and
18
investment towards maximising the returns. The in depth analysis of the preference, risk
perception, perception on return on investment and level of satisfaction will help the Government
to work out the various feasible schemes to mobilize finance from salaried class investors.
Further, the passion of this research is to make a comparative analysis between both Government
Sector employees in order to know the differences in demographic and socioeconomic factors and
the level(s) of investments. Thus, this study will benefit a large spectrum of salaried individuals
belonging to various households, investment agencies, financial institutions, banks and the
Government in general, in understanding the movement and scope for accumulation on money for
public and private sector growth
2.5 LIMITATIONS OF STUDY :
1.This study has been confined to Navi Mumbai .
2. The sample size was limited to only Government sector employees.
3. The reliability of information is based on the respondent’s opinion about the investment
techniques and the risk relating to it.
4. The study has been limited to salaried people who are employed in Government sector.
5. The study is based on the assumption that the respondents have given correct information.
6. The economy and industry are so wide and inclusive that it is difficult to comprise all the likely
factors influencing the investors’ investment pattern in the given period of time.
2.6 STATEMENT OF PROBLEM:
The behavior of the investors is drastically affected worldwide by the cyclical movements of the
economy. At present the interest rates are low for bank deposits and debt instruments. The values
of equities of many companies are low. The situation is suitable for investing in risk bearing
instruments. However, investors are hesitating to take any bold decisions. Investors tend to believe
that future will be a continuation of past trends. Hence they are reluctant to invest as they have
burnt their fingers. Investors mostly look out for most simple form of investments such as
Government securities, real estates, bank deposits, etc. for safety of their funds. They prefer to
invest only in what they know. They are not ready to invest in complex and new investments. Their
preference for a holding of high degree of cash could affect future return. The investors take time
19
to analyze the economic scenario with reference to each investment and make decisions
accordingly .
During periods of economic depression, investors are pessimistic and overestimate the risk. They
lack confidence and hesitate to invest in greater risks bearing investments, fearing loss. Most
investors incur loss on their investment during these tough times. However, due to the
unprecedented loss incurred by them during recessions, investors are disinclined towards changing
their investment pattern even at times of economic growth and stability. Investors in general, expect
their investments to fetch maximum returns and at the same time, they want to feel more safe and
comfortable. To choose the suitable investment 16 option, they should exercise their knowledge,
skills and experience more efficiently. Else, the entire investment made by them, may end up waste.
This study evaluates many different options for choosing best the investment portfolio and to
overcome the difficulties undergone by investors in investing their funds.
2.7 SAMPLE SIZE :
Navi Mumbai was selected for the purpose of collecting primary data, as almost all the major
banks have their branches located in the city. Non probability sampling method has been adopted
to select the sample. The sample respondents are the investors in various investments during 2018-
19. 125 samples are selected from various bank employees from Navi Mumbai . The researcher
visited these bank branches on different dates and collected data from the respondents. The present
study proposes to cover the banking employees in navi Mumbai . The samples are selected from
employees of major five categories namely Managers, Assistant Managers, Accountants, Senior
Clerks and Clerks. Each category is considered as a cluster. As the total 5 sample size covering all
the five categories combined together was found to be adequate, it was decided to have a complete
study.
2.8 DATA COLLECTION:
The present study is based on primary data. The primary data were collected in the form of
structured questionnaire from Government sector employees who have the experience and interest
in investment. The secondary data were collected from various journals, published research
articles, periodicals, Indian report of various private agencies, various thesis and dissertations
related to savings and investment, and other related areas.
20
2.9 TECHNIQUES AND TOOLS :
In this project Percentage analysis test was used. The percentage method is used to know
the accurate percentages of the data we took.. The following formula was used
No. of respondents favorable

Percentage of respondent = x 100
Total no of respondents
From the above formula, we can get percentages of the data given by the respondents.
2.10 RESEARCH DESIGN :
This study was designed to perform a descriptive analysis of the investment options of public sector
employees at Navi Mumbai.This study was conducted over a period of one month from October
2019 to November 2019 .
2.11 TYPES OF DATA COLLECTED:
❖ Primary Data
The primary data was collected from the questionnaire .It had questions of both multiple choice
and closed ended type.
❖ Secondary Data
Secondary data was collected from the internet, books, journals and company records.
2.12 QUESTIONNAIRE CONSTRUCTION:

A comprehensive questionnaire covering all aspects of the organizational function was drawn and
used in this study. The questionnaire comprised multiple choices and closed ended questions.
Questionnaires were constructed based on the following types
• Closed ended questions .
• Open ended question.
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2.13 SAMPLING PLAN :
A sampling plan is a definite design for obtaining a sample from the sampling frame. It refers to
the technique or the procedure the researcher would adopt in selecting some sampling units from
which inferences about the population is drawn. Sampling design is determined before any data are
collected.
Simple random sampling technique was adopted. In this method the researcher selects those
units of the population in the sample, which appear convenient to him or to the management of the
organization where he is conducting the research.
22
CHAPTER III.
REVIEW OF LITERATURE.
3.1 INTRODUCTION :
The economic development of a country depends mainly on the sustained growth of the industrial
and service sectors. This sectorial growth, in turn, requires vast resources and a major part of it is
met from domestic savings. In India, household sector savings are held mainly in physical assets
and conventional forms of financial assets like currency, post office bank savings, chit funds,
insurance funds, and bank deposits and provident and pension funds. If these savings can be
directly channelized into the corporate sector, it will facilitate the development of the country
through the development of industrial and service sectors. This demands the creation of an efficient
investment market. Many studies have been conducted to review various aspects of the investment
market nationally and internationally. Some of the relevant studies are reviewed in this chapter.
3.2 INTERNATIONAL STUDIES :

Myers (1977) correctly identified investment opportunities, including, for example, the
maintenance of equipment, as leading to potential underinvestment. He also noted the owners by
devising complex debt contracts can reduce the effect of potential underinvestment and induce
bondholders to pay a higher price for debt. But debt contracts can be effective only when the firm's
investment opportunity set is observable.
Colin M. Mason and Richard T. Harrison (2002) in their study Barriers to investment in the
informal venture capital sector, much of the government intervention into the market gap for start-
up and early-stage equity finance in the UK is based on the belief that the problem is on the supply
side. Based on the analysis of informal venture capital market this paper argues that there is no
shortage of finance available. A survey by business angels clearly states that many are willing to
allocate a higher proportion of their investment portfolio to investments in unquoted companies;
with tax incentives is having a positive effect on their willingness to invest. Over 90 per cent are
currently looking to make more investments. However, there are constraints on their ability to
23
invest: they do not see enough deals that meet their investment criteria, the majority of the
investment proposals that they receive are of poor quality, and they are often unable to negotiate
acceptable investment terms and conditions with entrepreneurs. The implication is that there is a
need for further interventions by policy-makers to remove these barriers so that more small firms
can take advantage of the substantial pool of angel finance that is available. The study concluded
that the issue was fundamentally one of competence: many investors lack familiarity with
techniques of successful investing, the opportunities which come forward more often than not are
not ` investment ready‟ , and the bottom level service providers in the small business support
network lack the expertise needed to add value to the process.
Akiko Kamesaka, John R. Nofsinger and Hidetaka Kawakita (2003) in their study Japan ,Using
weekly aggregate investment flow from Japan, we study the investment patterns and performance
of foreign investors, individual investors and five types of institutional investors. Securities firms,
banks, and foreign investors perform well over the sample period. Individual investors perform
poorly. They also find that foreign investor trading is associated with positive feedback market
timing and that this trading earns high returns. Alternatively, individual investors use positive
feedback trading in their market timing but earn low returns. Consequently, we document evidence
consistent with information-based models (foreign investors) and behavioral based models
(individual investors). It is a particularly new and interesting finding that evidence of both
information-based trading and behavioral-based trading occurs in the same market.
Dr. Odoemenem in their study, saving and Investment Pattern of Small-Scale Farmers of Benue
State, Nigeria‟. In his study was based on the saving and investment pattern of Small Scale Farmers
in Makurdi Local government Area of Benue State, Nigeria. 120 farmers were randomly sampled
using multi-stage sampling techniques and data were collected using structured questionnaire for
interview schedule. A multiple linear regression model was used to analyze the determinants of
saving and investment of the farmers with coefficient of determination (R2) of 77 per cent and F
value of 66.387 (p ≤0.00) for overall significance. Two variables were statistically significant, and
these are sex (10 per cent) and income (1 per cent) of the farmer. The result showed that 19.17 per
cent of the respondents were of the age between 39 and 48 and 79.2 per cent of them were males.
Analysis also revealed that 79.19 per cent of these farmers operated 4.9 hectares or less as farmland.
About 64.2 per cent of the respondents have the saving volume of N 100,000 or less and 51.80 per
cent of them save to carter for the family. Majority (64%) invested in non-farm activities.
24
Douglas J.Skinner in their study, “The investment opportunity set and accounting procedure
choice” This paper provided evidence on the cross-sectional relation between firms‟ investment
opportunities, their debt and compensation contracts, their size and financial leverage and their
accounting procedure choices. This evidence is important, because previous studies hypothesis but
the link between firms‟ investment opportunities and their accounting choices helps explain extant
results on the size. Debt/equity and bonus plan hypotheses. However, while he find that firms‟
investment opportunities do affect the nature of their contracts, he also find that the „traditional‟
explanations for accounting choice are important after controlling for the effects of the investment
opportunity set.
Stephen Thomsen in his study, “Investment Patterns in a Longer-Term Perspective”. Explorative

approach research type research was used. Hundred samples were chosen to be the sample size to
meet the required objective. For the growth process in the economy, reduction plays a vital role.
Production of output depends upon material inputs, human inputs, and financial inputs. Material
inputs are in the form of raw materials; plant, and machinery etc., Human inputs are like labor and
enterprise. Financial inputs are in the kind capital, cash, credit etc., the proper coordination between
these inputs; it promotes the growth process in the economy and promotes the well-being and
standard of living of in the country. So this paper tries to find the various factors. Finally he
concluded that the investors should be aware of the various hedging and speculation strategies,
which can be used for reducing their risk. Awareness about the various uses of derivatives can help
investors to reduce risk and increase profits. Though the stock market is subjected to high risk, by
using derivatives the loss can be minimized to an extent. Indian markets amongst the best regulated
markets in the world. Need for greater integration with international markets in terms of capital
flows, products and processes need to introduce new age.
3.3 PREFERENCE FOR INVESTMENT:
Madhusudhan Jambodekar (1996) in their study to assess the awareness of Mutual Funds among
investors, to identify the information sources influencing the buying decision and the factors
influencing the choice of a particular fund. The study reveals that Income Schemes and Open Ended
Schemes are more preferred than Growth Schemes and Close Ended Schemes during the then
prevalent market conditions. Investors gaze for safety of Principal, Liquidity and Capital
25
appreciation in the order of importance; Newspapers and Magazines are the first source of
information through which investors get to know about Mutual Funds Schemes and investor service
is a major differentiating factor in the selection of Mutual Fund Schemes.
Baskaran (1997) in his article titled “A study on the perception of investors towards small saving
schemes”analysed that it was very much necessary for institutions offering investment instruments
to study about the perception of investors towards various investment instruments because it
influences the saving behavior of investors. Hence, this study attempts to measure the nature of
perception of investors using a five-point scaling. To have a better understanding, investors are
segmented into three groups based on their perception by using cluster analysis. The study has used
correspondence analysis, chi-square test, analysis of variance and discriminant analysis in order to
understand the impact of perception on saving behavior of investors and the factors which
determine the perception of investors towards saving instruments.
The Securities and Exchange Board of India (SEBI) and NCAER, (2000) ‘Survey of India
Investors’ has reported that safety and liquidity were the primary considerations which determined
the selection of an asset. Ranked by an ascending order of risk perception fixed deposit accounts
in bank were measured very safe, followed by gold, units of UTI-US64, fixed deposits of
nongovernment companies, mutual funds, equity shares, and debentures. Households’ preference
for investments in which they commonly invested matched the risk perception. Higher proportions
of households invest in investments with a lower risk perception. Bank deposits, which had an
appeal across all income classes and tax-saving schemes, were preferred by middle-income and
higher-income groups of investors. There exist positive correlation between the income levels and
investments of households in market-related securities.
Karthikeyan (2001) has conducted research on Small Investors’ Perception on Post Office Saving
Schemes and found that there was significant difference among the four age groups, in the level of
awareness for Kisan Vikas Patra, National Savings Schemes, and Deposit Scheme for Retired
Employees and the overall score confirmed that the level of awareness among investors in the old
age group was higher than in those of the young age group. No dissimilarity was observed between
male and female investors except for the Kisan Vikas Patra and National Savings Schemes. Out of
the factors analyzed, necessities of life and tax benefits were two major ones that influence the
investors both in semi-urban and urban areas. Majority (73.3per cent) of investors of both semi
26
urban and urban areas were very much willing to invest in small savings schemes in opportunity
provided they have more for savings.
National council of applied Economics research (NCAER) ( 2002) in “Household savings and
investment behavior in India”. National council of applied Economics research (NCAER) and the
Economic and Political weekly Research foundation have observed that female headed household
in Urban Sector have a better pathway of record of saving than the household headed by males.
However the trend is overturn in rural areas where male-headed household are more inclined to
saving.
Kumar, Banu and Nayagam (2008) studied the financial product preferences
of Tiruchirapalli investors to rank their product preferences among investment choices, that is, post
office savings, bank deposits, gold, real estate, equity investments and mutual funds. The
preferences of the respondents were known according to their attributes like safety of principal,
liquidity, stability of income, capital growth, tax benefits, inflation resistance and concealability.
The authors studied this concept and found that the investors are unlikely to determine the financial
product preference, that is, which is better on each attribute. So, the investors needed to make
choices depending on what is available and what are his own priority ratings of the attribute needed
in the product. The rank preferences of investors were prioritized as post office, bank deposits,
gold, real estate, equity investments and mutual funds.
3.4 RISK PERCEPTION :
Kent Baker H.et al., (1977) in their study entitled, “An empirical Analysis of the risk return
preferences of individual investors’, tried to provide positive evidence on the nature of relationship
between acceptable risk level and expected annual rates of return and attempted to examine the
nature of the relationship between risk and the components of total return. The data for the study
were collected from individual common stock investors in Washington D.C. though a pre-tested
mail survey from 851 responses. A chi-square test of independence was used to test whether the
responses to the risk return preference question were statistically independent. Based on the result
of the study, the authors pointed out that a strong association excised between expected annual rate
of returns and acceptable risk levels on common stocks. An extremely storing relationship
prevailed between acceptable levels of risk & dividend income. Lower – Risk investors preferred
27
high dividend paying stocks that are less risky, to growth oriented stocks that return small dividend.
The study was also found a strong association between risk and capital appreciation.
Madhumathi (1998) “to examine the risk perception of individual investors and its impact of their
investment decisions”.Sample of 450 individual investors selected on a random basis from major
metropolitan cities in India. The investor where divided into. groups as risk sectors, risk bearers
and risk avoiders. The result of the study revealed that, a large number of investors (76%) were
risk bears. The risk bearers me tendency to use company performance as a basic factor to take
investment decisions and they used to depend on the advice of share brokers and investment
consultants. The risk reefers, on the hand, took their decision on the basis of market conditions,
industrial position, and social changes. Their sources of information consisted of impersonal
sources such as newspapers and reports. In fact they were advice givers rather man advice takers.
Risk avoiders did not have a specific trait in terms of information reception processing capacity or
situational constraints. They were very objective and looked for facts and certainly in their
investment decision situations. Their decisions were mainly based on the advice of their friends
and relatives. Market performance of the share, company’s operating level, capital performance
and the expectation of the investors were found to influence the risk perception of the investors.
Rajarajan (2000) in his article “Investor’s life styles and investment characteristics” with the
objective of finding out life styles bared on regimentation of individual investor and to analyze the
investment size, pattern and future investment preference of individual investors on the basis of
their life styles, the study was carried out in a state capital with 405 investors, divided into three
categories of groups like active investor, individualists and passive investors. The tools used were
cluster analysis, correspondence analysis and wallis test. The study revealed that the level
expenses, earnings and investment were associated with the size of the households active investor
was dominated by officers. Individual groups were dominated by clerical & passive groups was
dominated by professionals . The expected rate of return from the investment varied based on the
investment styles. As for risk bearing capacity is concerned, it was found out, that investors who
has more than 40% of their financial assets in risky category dominated the active investor group.
Individualists were possessing upto 20% of them financial assets in the risky investment.
The Securities and Exchange Board of India (SEBI) and NCAER, (2000) ‘Survey of Indian
Investors’ has reported that safety and liquidity were the primary considerations which determined
28
the choice of an asset. Ranked by an ascending order of risk perception fixed deposit accounts in
bank were considered very safe, followed by gold, units of UTI-US64, fixed deposits of
nongovernment companies, mutual funds, equity shares, and debentures. Households’ preference
for instruments in which they commonly invested matched the risk perception. Higher proportions
of households invest in instruments with a lower risk perception. Bank deposits, which had an
appeal across all income classes and tax-saving schemes, were preferred by middle-income and
higher-income groups. There was a correlation between the income levels and investments of
households in market-related securities.
Ranjith Singh (2002) study “Equity Investment Culture and Entrepreneurship-Culture-Initiation

and Adaptation” revealed that the increase image leads to the increase in tendency to invest and
decrease in risk taking attitudes among the investors. People in the service sector are the one who
are actually involved in the share business. The respondents who are graduates actually participate
in investment activities. Other who is working in government departments or organizations makes
the poor investment decision. The investor’s awareness about the investment decision is limited to
financial performance of the company. It was analysed that the level of risk and return associated
with the following investment avenues like shares, Debenture, Bonds, Mutual fund are high when
compared to others. In case of level of return, Real estates, Gold and Silver is high whereas NSC,
Provident Fund, Fixed deposits insurance policies etc the level of return is low.
Mittal and Dhade (2007) in their research paper “Gender Difference In Investment Risk-Taking:
An Empirical Study” published in The ICFAI Journal of Behavioral Finance, 4(2): 32-42. 2007,
Observed that risk-taking involves the selection of options that might result in negative outcomes.
While present is certain, future is uncertain. Hence, all investment involves risk.
3.5 LEVEL OF INVESTMENT:

Muhlesen (1997) in his article “Improving India’s Saving Performance” published in Finance &
Development, 1997 said that India’s saving raterelatively high, compared to other countries. He
concludes that with a view to increase the efficiency of savings, allocation and financing the heavy
infrastructure needs of the Indian economy, particular attention should be paid to long-term saving
instruments.
29
Somasundaram (1998) has found that bank deposits and chit funds were the best known modes
of savings among investors and the least known modes were Unit Trust of India (UTI) schemes
and plantation schemes. Attitudes of investors were highly positive and showed their intention to
save for better future.
Gavini and Athma (1999) A study on the perception of investors towards small saving schemes.
During their research found that the post office schemes, Indira Vikaspatra (IVP), KVP and post
office recurring deposit account were most popular in rural and urban areas. They concluded their
study by saying that the reason behind investing in these schemes were tax saving.
Kar Pratip, Natarajan and Singh (2000) in their research paper “Survey of Indian Investors”
published in SEBI-NCAER June 2000 concluded that the households investment in shares,
debentures and mutual funds was below 10% and the equity investor households portfolio was of
relatively small value and undiversified. Further they found that one set of households, in spite of
their lower income and lower penetration level of consumer durables, were in the securities market,
while another set of household with higher income and higher penetration level of consumer
durables did not have investment in securities market.
Gnana Desigan.et.al (2006) in their article titled “Women investors perception towards
investment. An empirical study was made an attempt to examine the investment pattern, investment
preference, to study the problems and factors influencing while making investment and to measure
the level of awareness about various aspects of investments. The sample size was 150 investors
through convenient sampling method. Tool used for level of awareness about right of investors was
chi-square test was applied. The result reveals that safety is the most important factor for making
an investment. Liquidity, stability and regular income went to capital appreciation, tax benefits
given me next order. The hypothesis of age, education and level of awareness are significantly
associated.
Avinash Kumar Singh (2006) The study entitled "Investment Pattern of People" has been
undertaken with the objective, to analyze the investment pattern of people in Bangalore city and
Bhubaneswar analysis of the study was undertaken with the help of survey conducted .After
analysis and interpretation of data it is concluded that in Bangalore investors are more aware about
various investment avenues & the risk associated with that. All the age groups give more important
to invest in equity & except people those who are above 50 give important to insurance, fixed
30
deposits and tax saving benefits. Generally those investors who are invested in equity, are
personally follow the stock market frequently i.e. in daily basis. But those who are invested in
mutual funds are watch stock market weekly or fortnightly. In Bangalore, investors are more aware
about various investment avenues and the risk associated with that. But in Bhubaneswar, investors
are more conservative in nature and they prefer to invest in those avenues where risk is less like
bank deposits, small savings, post office savings etc.
3.6 PERCEPTION ON RETURN ON INVESTMENT :
National Council of Applied Economic Research (NCAER) (1961) 'Urban Saving Survey'
noticed that irrespective of occupation followed and educational level and age attained, households
in each group thought saving for the future was desirable. It was found that desire to make provision
for emergencies were a very important motive for saving and importance was given next to 'saving
for old age'. Among motives for saving, provision for emergencies, old age, and purchase of house
occur with same frequencies in all occupational and educational groups. The proportion of
households expressing a preference for financial assets increases with the level of education. The
preference for financial assets, especially bank accounts and small savings, while rising markedly
with education, does not seem to increase with income, except at the lowest end of income
distribution. Thus, it would appear that efforts must be taken to popularize financial forms of
savings particularly among the less educated members of upper-income group. Profitability seems
to be the most important motive for determining saving preference. Safety is another significant
consideration for most people and liquidity ranked third.
Repetto and Shah, (1975) studied the demographic and other influences on long term saving
behavior in India. The data for the study was collected from surveys conducted in the Kaira district
of Maharashtra in 1930 and 1965. They analysed that large family size had a depressing effect on
long term household saving rate and that sons in rural India served as substitute assets in households
and fulfill some of the demand for wealth and that the long term saving rate responds positively to
a higher rate of return on saving and positively to higher-level of permanent income.
Rastogi and Meenakshi Chaturvedi (2012) in their article “Impact of risk on the saving pattern
in present scenario: ways and means to diversify it ” examined that Risk and its consequences
cause a terrible threat to saving pattern in present scenario. The saving rate will probably continue
to rise but if we notice that the saving rate shows fluctuation and went negative during the
depression as investor used savings to supplement income. This study examines the impact of risk
31
on saving pattern and different ways to diversify it. After analyzing the data related to Gross
Domestic Saving and Gross Capital Formation from the Economic Survey of India a positive
correlation comes between Gross Domestic Saving and Gross Capital formation. The Objective of
Research were to identify various types of risk, to identify saving pattern of the household , to
analyze the impact of risk on saving pattern and to identify the various tools to diversify the risk.
The Study also shows that risk causes an inverse impact on the saving of the investor because every
investor wants to make a balance between their risk and return.
Nanavati Nihar (2012) in the article titled “Investment Preferences of Salaried People: A Survey”
in Journal of Advances in Developmental Research, june 2012 reviewed that The investment
ideology depends upon the individuality and many other factors. A market survey with an
instrumental tool of Questionnaire, 25 salaried people were selected randomly in specific area of
Ahmedabad has been conducted to identify their investment psychology and relevant preference.
It was concluded that Inclination towards safe, secure and tax beneficial investment is more than
that of risky or high return investment. With lower income segment, one cannot create wealth but
with good combination of investments, one can create a better and respectable living.
Suyam Praba (2013) titled “Investors’ Decision Making Process and Pattern of Investments- A
Study of Individual Investors in Coimbatore” in this project is to study how the Investor’s Behavior
is changing and they are now leaving behind the sacred investment options like the POSB, Mutual
funds, Insurance, Bank deposits, gold etc. by conducting a survey among 109 salaried respondents
in Coimbatore city who either work for IT, Bank or for NBFC with the objective to study the
savings pattern, factors influencing the decision making process of savings and investment, to do
risk profiling of investors and to assess the conceptual knowledge, awareness level and perception
about Mutual funds. Research shows that most of the working people do not plan their savings and
believe that their current savings will be enough to take care of their post retirement needs.
Research implies that there is significant relationship between gender and MF investment and also
annual income of the investors does have an impact of MF investment.
32
3.7. LEVEL OF SATISFACTION
Srinivasan Sakthi and Lakshmi Devi (2006) focuses on rural investment with reference to post
office savings schemes under title, ‘Post office savings scheme– An Impetus for Rural Investment’.
Researchers have undertaken almost all savings schemes offered by post office savings banks for
analysis. Study has been arrowed to assess the saving habit of individuals, to understand the
awareness of people towards post office savings scheme and to bring out the investors perception
towards post office for their investment. Researcher has observed the significant relationship
between gender and percentage of income saved by the respondents, status and percentage of
income saved, income level and percentage of income saved, ages and purpose of savings by the
respondents and relationship between income and purpose of saving. Absence of relationship found
between age and percentage of income saved by the respondents, investment and status of the
respondents, investment and income pattern. Majority of rural investors i.e. 61.9% invest in post
office savings schemes followed by insurance 48.5% and bank savings account 46.4%. Security is
a major reason behind investment in post office saving schemes. The research was descriptive
nature worked on 291 rural investor amples.
Geetha and Ramesh (2011) in their study on “A Study on People’s Preferences in Investment
Behaviour ” examined on people’s choice in investment avenues of Kurumbalur. The objectives
were to study the factor that influence investment behavior of the people and to study the attitude
of the respondents towards different investment choices. Data were collected using structured
questionnaires. The sample size of area is analyzed by tools selected for this study was two hundred
and ten respondents were randomly selected from the town. Data were analyzed using descriptive
statistics and chi-square technique. This study reflects the perceptions ofthose respondents who are
residing in Kurumbalur. There might be a chance that the perceptions of the respondents of
different are varied due to diversity in social life, living pattern, income level etc. All the age groups
give more important to invest in Insurance, NSC, PPF and bank deposit. Income level of a
respondent is an impotent factor which affects portfolio of the respondent. Middle age group,
Lower income level groups respondents are preferred to invest in Insurance, NSC, PPF and bank
deposit rather than any other investment avenues. In Kurumbalur respondents are more aware about
various investment avenues like Insurance, PPF, bank deposits, small savings like post office
savings etc. For that awareness program has to be
33
conducted by Stock Brokering firms because most of the respondents unaware about this new
service and about stock market.
Yogesh P. Patel and Charul Y. Patel (2012) in their article “ A Study of Investment Perspective
of Salaried People (Private Sector)” published in Asia Pacific Journal of Marketing & Management
Review, Vol.1 No. 2, October 2012 concluded that investor's greatest and most portent enemy is
Greed for Higher Returns. Many a times, rational thinking people tend to behave in the most
irrational manner while investing their savings. A well known investment guru has analyzed this
uncanny behavior in one sentence - "Investor, protect thyself from thyself". While analyzing, the
popular savings options, one should consider two key factors: Taxation and Inflation along with
risk and return. Thus, a sound investment is one which gives the investor reasonable return after
deducting outgo of tax as well as the invisible tax of inflation.
Kalavathi (2009) in her study “A study on savings and investment behavior of salaried persons –
with special reference to Coimbatore city” concluded that with the proportion of population in the
working age group of 15-64 years is also going to increase in future. The study evidences grown
in real interest rate, grown in percapita income, spread of banking facilities and the rate of inflation
as statistically positive influences on domestic savings. Accumulated savings converted into
investment total savings comprises of domestic, corporate, foreign and household.
3.8. CONCLUSION :
Many studies relating to the importance of savings and investment of investors and salaried class
individuals have been reviewed in this chapter. There are many theoretical and empirical studies
assessing the factors influencing savings and investment leading to the development of the
economy. It is understood from the review that the level of investment is influenced by risk and
return and perception on investment and level of investment. It is elicited that risk and return have
a large effect on investment which results in satisfaction of the employees which is identified as a
gap among the employees. Moreover none of the study were found to have a comparative study on
the Government and private sector employees investment pattern. So, this has been considered as
a major theme for research analysis.
34
CHAPTER IV
DATA ANALYSIS AND INTERPRETATION.
4.1 Introduction:
The growth of investment market is a reflection of the economic and social dynamism that has
been underway over time. The main indicator of the state of investment market is the regular flow
of investments and their quantum. The overall progress of the nation depends on the new
investments which performs the crucial function of facilitating capital formation in the economy.
The fund collected through the primary issue is utilized for the development of industry and
infrastructure. The retail investors are considered vital for the stability and development of
investment market and they form an important constituent of investment. This chapter discusses
the
• Factors influencing the investment, investment objectives and features of

investment.
• Investors pattern and awareness of their investment.
35
4.2 Personal Factors of Investors in study area:
This section gives the personal factors of the respondents of the study area. The respondents are
classified and distributed by gender, age education, working bank, designation, dependents, annual
income, savings per month and wealth holding.
The following table 4.1 expresses the gender wise classification of the respondents.
Gender No. of respondents Percentage

Male 60 48
Female 65 52
Total 125 100
Table 4.1
Gender wise classification of the respondents.
Source : Primary Data .
Table 4.1 shows the gender wise classification of the respondents. It is inferred that the majority of
the respondents are female (52 per cent) and male respondents are less than the female respondents
.
36
Chart 4.1
GENDER WISE DISTRIBUTION

70
60
Number of respondents
50
40
30 NUMBER OF RESPONDENTS
PERCENTAGE
20
10
0
MALE FEMALE
Gender
37
4.2 Age :
It is essential to study about the age of respondents because age influences the performance of a
job. Moreover age refers to maturity and experience in the work situation. Longer length of the
service of the members results in better understanding of the various features of the investment.
Therefore, the age of the respondents is indicates of her relative position in their position. The data
regarding age of the respondents are furnished in Table 4.2.
S.NO Age Number of respondents Percentage

1 Below 30 40 32
2 31 – 40 25 20
3 41 – 50 30 24
4 Above 50 30 24
Total 125 100
Table 4.2
Age wise distribution of respondents
Source : Primary Data.
It is observed from the table 4.2 that 32 percent of the respondents are relatively young in age. It is
noted that 24 percent of the members are in the age group of above 40.
38
Chart 4.2
AGE WISE DISTRIBUTION

45
40
35
30
25
PERCENTAGE
15
10
0
BELOW 30 31 - 40 41 - 50 ABOVE 50
Age Group
39
4.3 Educational Status :
Education molds influenced the mind of the young and the old and has the power to determine for
what purpose the knowledge and the experience will be used. It creates new attitude or generate a
work force with new values, work ethic and new skills and positive orientation. Productivity of the
members is an essential element of the new value and new behavior. Hence Basic education
influences the productivity of the investors. It boosts the productivity, this variable is analyzed
through the table 4.3, which gives the level of education of the respondents.
S.NO Educational level Number of respondents Percentage

1. Graduate 65 52
2. Post graduate 35 28
3. Professional 25 20
Total 125 100
Table 4.3
Educational level of the respondents
It is understood from the table 4.3 that more than 52 per cent of the respondents are graduates.
However, variation in educational status has also been noticed among them 28 per cent of them
have obtained post-graduation, and the remaining 20 per cent of them have completed their
professional degree.
40
Chart 4.3
EDUCATION LEVEL
70
60
50
40
30 NUMBER ODF RESPONDENTS
20 PERCENTAGE
10
0
GRADUATE POST GRADUATE PROFESSIONAL
Educational status
41
4.4 Designations :
Designation plays a major role in the investment capacity, while salary based on only designation.
The following table 4.4 shows the respondents designation position.
S.NO Designations Number of respondents Percentage

1. Manager 10 8
2. Ass. Manager 15 12
3. Accountants 20 16
4. Senior clerks 35 28
5. Clerks 45 36
Total 125 100
Table 4.4
Designations of respondents
Table 4.4 shows that the, majority of the respondents are Senior clerks and clerks and they account
for about 64 per cent of the total respondents. Accountants are 20 per cent, occupying the second
place. The managers and assistant mangers occupy the third place with 20 per cent.
42
Chart 4.4
DESIGNATIONS
50
45
40
35
30
25
20
15
10
5
0
MANAGER ASSISTANT ACCOUNTANTS SENIOR CLERKS CLERKS
MANAGER
NUMBER OF RESPONDENTS PERCENTAGE
43
4.5 Martial Status :
Marriage burdens respondents with heavier responsibilities. They are more committed to the
society. Higher responsibility is shouldered by married men or women. A referential analysis
therefore of marital status is required here. The sample members are considered in terms of married,
unmarried, widow and separate. The marital status of the respondents is presented in Table 4.5
Sr. No Martial status Number of respondents Percentage

1. Married 50 40
2. Unmarried 30 24
3. Widow 25 20
4. Separate 20 16
Total 125 100
Table 4.5
Martial Status of the respondents.

In the sample as shown in table 4.5 the proportion of married respondents were 40 per cent,
unmarried respondents were 24 per cent and 20 per cent of them were widows and 16 per cent of
them were separate.
Chart 4.5
44
MARITAL STATUS
60
50
40
30
20
10
0
MARRIED UNMARRIED WIDOW SEPARATE
NUMBER OF RESPONDENTS PERCENTAGE
45
4.6 Family Size :
The size of the family includes the number of the people belonging to a family. The study of the
size of the family show the number employees force in the number of family or children and old
aged who dependent on the earning members. A large family with more dependent members in the
family is a burden for the earning members of the family. There would be no surplus stock. On the
other hand large families with more earning members generally have more invertible funds and
surplus stock of food materials, the economic standards of the members are influenced by the
family size. Table 4.6 shows the family size of respondents.
Sr. No Family size Number of respondents Percentage

1. Upto 2 40 32
2. 3–4 55 44
3. 5–6 20 16
4. Above 6 10 8
Total 125 100
Table 4.6
Family size of the respondents .

Table 4.6 shows that, out of 125 respondents nearly two thirds of the families have 3 – 4
members and about 32 per cent of the respondents family size is two members. The 30
respondents with large families are limited in number.
46
Chart 4.6
FAMILY SIZE
60
50
40
30
NUMBER OF RESPONDENTS
20 PERCENTAGE
10
0
UPTO 2 3 TO 4 5 TO 6 ABOVE 6
Family Size
47
4.7 Annual Income :
The deciding factor in the investment activity in securities is the income of investors family.
Income is also said to influence the quality and quantity of investment in securities. The surplus
income above expenditure finds its way into various saving channels. The Table 4.7 indicates the
total income of respondents per annum.
S.NO Annual Number of respondents Total

income in Manager & Accountants Senior clerks
lakhs assistant &clerks
manager
1. Upto 3 _ _ 15 15
(12) (100)
2. 3–4 _ 15 30 45
(12) (24) (100)
3. Above 4 28 10 22 60
(22.4) (8) (17.6) (100)
Total 28 25 67 125
Table 4.7
Annual income of the respondents.
(Figures in parenthesis indicate percentages to total)
48
Table 4.7 reveals that out of 125 respondents, more than half of the respondents‟ income ranges
between Rs 3 lakhs and Rs 4 lakhs per year. It further reveals that nearly 15 respondents earning is
less than Rs 3 lakhs per annum. 17.6 per cent of the senior clerks and clerks category respondents
income exceeds Rs 4 lakhs. This group has 22.4 percent of the managers and assistant managers.
In the accountant category 8 per cent of respondents income exceeds Rs 4 lakhs.
Chart 4.7
ANNUAL INCOME
30
25
20
15 managers and assit. manager

accountants
10 senior clerks and clerks
0
upto3 3-4 above 4
Annual income in lakhs
49
4.8 Sources of Income for Investment :
Source of income is a key factor of investment activity it, not only determines the ability of an
investor to make investment but also influences his character as either the investor or speculator.
Table 4.8 shows the details of the sources from which the funds flow for investment.
Sources of income Number of respondents Percentage
Salary income 30 24
Other sources 40 32
Borrowed funds 55 44
Total 125 100
Table 4.8
Sources of income for investment .
Table 4.8 indicates that, 44 per cent of the respondents resort to rely on borrowed funds. But 56
per cent of the investors have utilized other sources.
50
Chart 4.8
SOURCES OF FUNDS
60
50
40
Axis Title
30
20 PERCENTAGE
10
0
SALARY INCOME OTHER SOURCES BORROWED
FUNDS
Axis Title
51
4.9 Savings per month of respondents :
Savings indicate expenditure over income that is not spent on current consumption and it
constitutes a larger part of the nations aggregate savings and investments and this is a major
determinant of the growth of future income and consumption. Generally, the higher the level of
income, the greater is the scope for savings. Besides, the size of savings depends upon other
economic and non-economic factor as well. The range of savings of the respondents is shown in
Table 4.9.
Savings per month Number of respondents Percentage

( in Rs )
Upto 5000 35 28
5001 – 7500 25 20
7500 – 10,000 15 12
Above 10,000 50 40
Total 125 100
Table 4.9
Savings per month of the respondents.

From Table 4.9 it is found that 40 percent of the respondents save more than 10000 per month.
Even though the percentages vary among different savings categories all the respondents have the
aptitude for savings.
52
Chart 4.9
SAVINGS PER MONTH

60
50
40
30
PERCENTAGE
20
10
0
UPTO 5000 5001 - 7500 7500 - 10,000 ABOVE 10,000
Savings per month
53
4.10 Wealth – Holding of Respondents :
The investment pattern of an individual investor depends mainly upon the size of his wealth-
holding. An individual with larger size of wealth is better placed than an investor with smaller size
of wealth to assume the risk involved in his investment. Table 4.10 shows the wealth holdings of
the individual respondents of the area under study.
Wealth size (in lakhs ) Number of respondents Percentage
Below 35 lakhs 40 32
35 – 50 lakhs 60 48
Above 50 lakhs 25 20
Total 125 100
Table 4.10
Wealth – Holding of respondents.
Table 4.10 shows the respondents with the wealth-holding size of 35 lakhs to 50 lakhs form as
many as 48 per cent of the total respondents. It is followed by the respondents with wealth size of
below 35 lakhs who form 32 per cent. Finally only 20 per cent of the respondents hold the wealth
size of more than 50 lakhs.
54
Chart 4.10
WEALTH HOLDING
70
60
50
40
30
PERCENTAGE
20
10
0
BELOW 35 LAKHS 35 -50 LAKHS ABOVE 50 LAKHS
Wealth size
55
4.11 Investments Decisions :
For every activity or abstinence of an individual, there are some influencing factors. Investment
activity is also subjected to influencing factors. While an investor is influenced by factors namely
real investments or tangible investments, contingent investments and titular investments and the
opinion by the respondents are shown in the Table 4.11.
Investments alternatives Number of respondents Percentage
Real investment or tangible 40 32
Contingent 50 40
Titular 35 28
Total 125 100
Table 4.11
Respondents opinion about Investment Alternatives.
Table 4.11 shows the respondents opinion about the investment alternatives, out of 125
respondents one-third of them invest their fund,40 per cent of them invest in the area of contingent
and 28 percent of then invest in titular form.
56
Chart 4.11
INVESTMENT ALTERNATIVES
REAL OR TANGIBLE INVESTMENT CONTINGENT TITULAR
28%
32%
40%
57
4.12 Respondents Opinion about Real Investment or Tangible Investment :
The real assets always find a place in the portfolio of the investor. Real investments, otherwise,
known as tangible investments have a physical or tangible existence such as land, house, jewelry,
precious stones, gold, silver, property and antiques etc. These are non-financial investments in
nature. The following Table 4.12 presents the respondents opinion about real investments or
tangible investment.
Investments Number of respondents Percentage
Real estate 20 50
Jewelry 12 30
Silver & precious materials 8 20
Total 40 100
Table 4.12
Respondents opinion about real or tangible investment.
Table 4.12 shows the respondents opinion about the real or tangible investment, out of 40
respondents majority of them invest their fund in the form of real estate such as land, houses, plots
etc., 30 per cent of them are invest in the area of jewelry and rest of them invest in the form of
silver and precious materials.
58
Chart 4.12
RESPONDENTS OPINION ABOUT TANGIBLE

INVESTMENTS
Number of respondents 60
50
40
30
PERCENTAGE
10
0
REAL ESTATE JEWELRY SLIVER
&PRECIOUS
MATERIALS
Investment
59
4.13 Respondents Opinion about Contingent Investment:
Contingent investments are the second form of Investment Avenue available to investors. The
typical example of contingent investment is the insurance policies. The vital features of contingent
investments are that their value is related to a contingency in the form of death, accident, injury
etc. There are so many insurance policies are available, but some important plans are selected by
the respondents. The following Table 4.13 gives the respondents opinion about the contingent
investment.
Policies Number of respondents Percentage

Whole life assurance plan 10 20
Endowment assurance plan 3 6
Jeevan anurag plan _ _
Jeevan nidhi plan 3 6
Jeevan pramukh 2 4
Jeevan mitra _ _
Jeevan saral 3 6
Jeevan adhar 1 2
Money back policy 19 38
Bima plus 9 18
Total 50 100
Table 4.13
Respondents opinion about contingent investment .
Table 4.13 shows the opinion about the respondents investment in contingent. Out of 50
respondents 38 per cent of them select the money back policies, 20 percent of them select whole
life assurance plan and 18 per cent of them selected Bima Plus.
60
Chart 4.13
POLICIES
18% Whole life insurance plan

20%
Endowment assurance plan
Jeevan anurag plan
Jeevan nidhi plan
6% Jeevan pramukh
0% Jeevan mitra
6% Jeevan saral
Jeevan adhar
4%
38% Money back policy
6% 0% Bima plus
2%
61
4.14 Respondents Opinion about Titular Investments :
Titular investments come with merely a little to the investor by way of certificates, deposit receipt,
promissory note etc., issue by the competent authority of the borrower. By nature, they are not
tangible or physical as in the case of real investments. Titular consist of wide variety of new
financial instruments. The following Table 4.14 presents the respondents opinion about the titular
investments.
Investments Number of respondents Percentage

Bank deposits 16 45.7
Post office schemes 2 6.6
Fixed deposit schemes in companies 3 10
Provident fund schemes 8 26.6
Mutual fund schemes 4 13.3
Government securities 2 6.6
Total 35 100
Table 4.14
Respondents opinion about titular investments .
Source: Primary Data.
Table 4.14 shows that, out of 30 respondent 45.7 percent of them choose bank deposits, 26.6 per
cent of them select provident fund schemes and the remaining of them occupy next places.
62
Chart 4.14
TITULAR INVESTMENTS OPTIONS
6%
Bank deposits
12%
Post office schemes
42% Fixed deposit schemes in

companies
Provident fund schemes
25%
Mutual fund schems
Government securities
9% 6%
63
4.15 Nature of Deposits:
Among investments, deposits with banks are more popular. Banks have introduced different types
of deposit accounts with various facilities and privilege. Traditionally, deposits with banks are
classified into four categories, namely Bank Deposits, Recurring Deposit, Fixed Deposit Schemes
and Novel Deposit Schemes. The following table 4.15 presents the respondents deposits nature.
Nature of deposits Number of respondents Percentage

Bank deposits 4 36
Recurring deposits 3 27
Fixed deposits 2 18
Novel deposits 2 18
Total 11 100
Table 4.15
Nature of deposits.
It is inferred from the Table 4.15 shows that the more than 36 per cent of the respondents invest
in bank deposit form, 18 per cent of them select fixed deposits and the remaining of them select
next options.
Chart 4.15
64
NATURE OF DEPOSITS
BANK DEPOSITS RECURRING DEPOSITS FIXED DEPOSITS NOVEL DEPOSITS
18%
37%
18%
27%
65
4.16 Post Office Deposits :
Generally, post office schemes are also like the commercial bank schemes. Originally institutions
called Trustee Savings Bank were operating the savings bank accounts. These institutions became
extinct gradually and the postal department took up the task of providing a facility to save through
their postal savings accounts. As this account became popular, the Government of India could
collect crores of rupees through this account. A part from this savings bank account, post office
offers various schemes which prove to be attractive for the investors who attach utmost importance
to safety aspect. The following Table 4.16 gives investors opinion about post office schemes.
Schemes Number of respondents Percentage
Post office monthly income scheme 2 100

Kisan vikas patra _ _
National saving certificate _ _
Public provident fund _ _
Post office recurring deposits _ _
Post office time deposits _ _
Total 2 100
Table 4.16
Post office schemes.
It is understood from the Table 4.16; all the 2 respondents invest in post office monthly income
scheme . No one can select the public provident fund scheme in post office because it is not giving
tax benefits to the respondents.
66
Chart 4.16
120
Number of respondents 100
80
60
Percentage
40
20
0
Post office monthly income scheme
Schemes
67
4.17 Provident Fund Schemes:
Normally, provident fund scheme is a retirement benefit scheme. Since the schemes encourages
personal savings at micro level and generate funds for investment at macro level, the Government
provides tax incentives under Section 88 of the Income Tax Act. The following table 4.17 presents
the provident fund schemes.

Recognized provident fund 8 100
Unrecognized provident fund _ _
Public provident fund _ _
Total 8 100
Table 4.17
Provident Fund Deposits .
Table 4.17 presents the opinion about the provident funds schemes; all the 8 respondents are
investing only recognized Provident Fund only.
Chart 4.17
120
100
Number of respodents
80
60
Percentage
40
20
0
Recognized PF
Schemes
68
4.18 Mutual Fund :
Mutual funds have become popular all over the world. Mutual funds carry benefits in the form of
safety of principal, capital appreciation and interest or dividend. Under mutual fund scheme, an
investor, even with a little money can be a participant in investing in big companies, which are
otherwise inaccessible to him because of his small investment. The investor should be aware of the
risks of these growth schemes while making an investment decision. When mutual funds have
income schemes, then investment is made in securities of a guaranteed return. Under income
schemes, mutual funds select a large share of fixed income securities like debentures and bonds.
Basically mutual funds are classified in to two categories, such as execution and operation and
yield and investment pattern. The following table 4.18 presents the respondents opinion about the
classification of mutual fund.

Basis of execution 1 25
and operation
Yield and investment pattern 3 75
Total 4 100
Table 4.18
Respondents opinion about classification of mutual fund.
Table 4.18 shows that, out of 4 respondents 60 per cent of them are select Yield and investment
pattern schemes and the remaining of them are select Basis of execution and operation.
69
Chart 4.18
CLASSIFICATION OF MUTUAL FUNDS

80
70
N umber of respondents
60
50
40
30
PERCENTAGE
20
10
0
BASIS OF EXECUTION & YIELD & INVESTMENT PATTERN
OPERATION
Schemes
70
4.18.1 Basis of Execution and Operation
There are two types of this scheme such as close –ended funds and open-ended funds. Under close-
ended funds, the corpus of the fund, its duration and the number of units are determined in advance.
When the subscription reaches the pre-determined level, the entry of investor is closed. Open-ended
funds are the just opposite of close-ended funds. The following table 4.18.1shows the respondents
opinion about the basis of execution and operation schemes.

Close ended 1 100
Open ended _ _
Total 1 100
Table 4.18.1
Respondents opinion about basis of execution and operation.
It is understood from the table 4.18.1, all the respondents select the close-ended fund .
Chart 4.18.1
120
100
80
60
Percentage
40
20
0
Close ended
Schemes
71
4.18.2 Yield and Investment pattern
There are six classifications in this pattern such as income fund, growth fund, balance fund,
specialized fund, money market and taxation funds. These are very popular and frequently used by
the investors. The following table 4.18.2 presents the respondents opinion about the yield and
investment pattern schemes.

Income fund _ _
Growth fund 1 33
Balance fund _ _
Specialized mutual fund _ _
Money Market _ _
Taxation fund 2 66
Total 3 100
Table 4.18.2
Respondents opinion about yield and investment pattern schemes.
Table 4.18.2 shows that, 66 per cent of the respondents select the taxation fund, 33 per cent of
them choose growth fund . It is interesting to note that no one can select the balance fund,
specialized fund, income fund and money market funds.
72
Chart 4.18.2
70
60
50
40
30
Percentage
20
10
0
Growth Fund Taxation fund
Schemes
73
4.19 Government Securities
The securities issued by the central, state and quasi-governments are known as Government
Securitas or gilt edged securities. So a government-guaranteed security is a claim on the
government. The rates of interest on these securities are relatively have a large market. Promissory
notes and stock certificates are the important forms of Government securities. The following table
4.19 gives the respondents opinion about the Government securities.
Securities Number of respondents Percentage

Promissory notes 1 50
Stock certificates 1 50
Total 2 100
Table 4.19
Respondents opinion about government securities.
Table 4.19 reveals that 50 per cent of the respondents desire stock certificates and the rest 50 per
cent of them craving promissory notes.
74
Chart 4.19
GOVERNMENT SECURITIES
Promissory notes Stock certificate
50% 50%
75
4.20 Investment Portfolio Comprises
Portfolio is a combination of securities such as stocks, bonds and money market instruments like
commercial papers, certificates of deposit etc. These assets are blended together so as to obtain
optimum return with minimum risk. The objective of every rational investor is to maximize his
returns and minimize the risks. Diversification is the method of reducing risks and it essentially
results in the construction of portfolio. The following table 4.20 presents the respondents ranks
about their investment portfolio.
S.NO Factors Number of respondents Total

1 2 3 4 5
1. Mainly cash/bank deposits with a 45 30 25 15 10 125
small portion invested in low risk (36) (24) (20) (12) (8) (100)
investments
2. Mainly debt market investments 35 40 20 16 14 125
(bonds, Mutual Funds) and some (28) (32) (16) (12.8) (11.2) (100)
portion in blue chip stocks
3. A mix of debt instruments, blue chip 15 10 45 25 30 125
and aggressive stocks (12) (8) (36) (20) (24) (100)
4. Mainly aggressive stocks and high 20 15 25 35 30 125
yield debt Funds (16) (12) (20) (28) (24) (100)
5. Mostly speculative or high risk 15 10 25 30 45 125
investments (12) (8) (20) (24) (36) (100)
Total 125 125 125 125 125 125
(100)
Table 4.20
Factors influencing investment portfolio comprises.
(Figures in parenthesis indicate percentage to total)
Highest numbers of respondents (45) have given first rank for the factor Mainly cash/bank deposits
with a small portion invested in low risk investments. The study indicates that the investors repose
76
great confidence in bank deposits. Many of the bank deposits are give nominal rate of interest and
they are low risk in the market than the other securities.
It is also found that the respondents are influenced by income in the form of investment in blue
chip companies (28 per cent). It is proved that the investors are confident and anticipated that their,
investment would definitely fetch income in the future. Among the respondents 8 per cent have
given second rank and only 24 per cent have given the last rank to this factor.
The respondents who preferred a mix of debt instruments, blue chip and aggressive stocks are of
the opinion that obtaining securities is an opportunity for them to identify the prospective company
before making an investment . Only 16 per cent of the respondents gave first rank to the factor
Mainly aggressive stocks and high-yield debt funds and 24 per cent of the respondents have given
last rank to this factor.
Mostly speculative or high risk investments have limited role to play in the portfolio investment.
This is reflected by the way of reporting with a little as 12 per cent of respondents favoring this
factor in the first place and as many as 36 per cent of respondents placing in the last place i.e., rank
5. The intensity value was calculated on the basis of the following calculation. Values five, four,
three, two and one respectively was given to the first , second, third, fourth and fifth ranks.
77
Chart 4.20
120
100
80
60 Rank 5
Rank 4
40
Rank 3
20 Rank 2
Rank 1
0
Cash and Debt market Mix of debt High yield Speculative
Bank investments intruments debt funds or high risk
deposits ,blue chip investment
and
aggressive
stocks
Factors
78
4.21 Factors Influencing Portfolio Management
Investing in securities is profitable as well as exciting. The expected return from individual
securities carries some degree of risks. The investors can hope that even if one security incurs a
loss, the rest will provide some protection. Thus, portfolio or combinations of securities are thought
of as a device to spread risk over many securities. Portfolio management refers to the process of
selecting securities for creating an investment portfolio in order to satisfy the investment needs of
the investors. The investor endeavors to accomplish the investment objectives. They should be
aware of the various factors of portfolio management such as planning, timing of investment,
conservatism and rationalism, close monitoring and performance appraisal. To know all these
factors, factors influencing to portfolio management of the respondents are ranked. This is shown
in Table 4.21
S.NO Factors Number of respondents Total
1 2 3 4 5
1. Planning 40 30 25 20 10 125
(32) (24) (20) (16) (8) (100)
2. Timing of investment 30 35 25 20 15 125
(24) (28) (20) (16) (12) (100)
3. Conservatism and rationalism 30 25 45 20 5 125
(30) (20) (36) (16) (4) (100)
4. Close monitoring 20 15 15 40 35 125
Of investment (16) (12) (12) (32) (28) (100)
5. Performance appraisal 10 15 25 30 45 125
(8) (12) (20) (24) (36) (100)
Total 125 125 125 125 125 125
Table 4.21
Factors influencing portfolio management.
79
Table 4.21 indicates the ranking of factors influencing to portfolio management according to the
degree of performance of the sample investors. It is found from the study that the respondents keep
in mind five broad factors at the time of taking portfolio management decision.
Among the respondents 70 per cent has given first and second rank for the factors namely planning.
This shows that the investors keeps his mind while preparing a list of portfolio, due consideration
should be given to the investment needs of an investor.
It is also found from the study that 24 per cent investors expect the timing for investment and have
given first rank to this factor. This indicates that the investors are very careful and calculative while
choosing issues in their investment. The other factors namely Conservatism and Rationalism, Close
Monitoring of Investment and Performance Appraisal are not found attractive among the
respondents.
Chart 4.21
FACTORS INFLUENCING PORTFOLIO MANAGEMENT
120
100
80
60
40
20
0
Planning Timing of Conservatism Close Performance
investments and rationalism monitoring of appraisal
investment
Rank 1 Rank 2 Rank 3 Rank 4 Rank 5
80
4.22 Principles of Portfolio Management
Investors place a varying emphasis on the portfolio management. Investors may be institutional
investors or individual investors. Institutional investors such as commercial banks, mutual funds,
non-banking finance companies, term lending institutions etc., have clear cut principles to establish
an effective investment portfolio. But individual investors lack adequate principles and seek the
assistance of competent investment assistants in designing their portfolio as to secure their
objectives. Apart from these, there are certain basics principles necessary for executing an
investment program. These are known as guiding principles in establishing and investment
portfolio.
S.NO Principles Number of respondents Total

1 2 3 4 5
1. Safety of funds 30 20 10 40 25 125
(24) (16) (8) (32) (20) (100)
2. Stability of price 40 30 20 25 10 125
(32) (24) (16) (20) (8) (100)
3. Liquidity 30 35 20 15 25 125
(24) (28) (16) (12) (20) (100)
4. Returns 45 30 25 15 10 125
(36) (24) (20) (12) (8) (100)
5. Capital growth 25 30 50 5 15 125
(20) (24) (40) (4) (12) (100)
6. Marketability 5 10 25 55 30 125
(4) (8) (20) (44) (24) (100)
7. Diversification 10 25 15 30 45 125
(8) (20) (12) (24) (36) (100)
8. Taxability 50 30 25 15 5 125
(40) (24) (20) (12) (4) (100)
Total 125 125 125 125 125 125
(100)
Table 4.22
Principles of portfolio management.
81
Table 4.22 indicates that the respondents attach returns in their investments as 45 per cent of the
respondents ranked in first in their order of preferences. Following it, taxability which is
represented by tax benefits ranked second and 50 per cent of respondents gave first rank to it. In
third place, 40 per cent of respondents want stability of price. Liquidity of investment occupy fourth
place with 30 per cent first rank score. Safety of funds, capital growth, diversification and
marketability placed next ranks.
Chart 4.22
PRINCIPLES OF PORTFOLIO MANAGEMENT
100
90
80
70
60 Rank 5
50
Rank 4
40
30 Rank 3
20 Rank 2
10
Rank 1
0
82
4.23 Problems in Portfolio Management
Like positive factors, there are certain factors which deter and discourage the investors from
making their investments. An attempt has been made further, to know what are the negative factors
which restrain the sample respondents from their portfolio investment. This is shown in Table 4.23
S.NO Problems Number of respondents Total

1 2 3 4 5
1. Constructing an optimal 40 35 15 25 10 125
investment portfolio (32) (28) (12) (20) (8) (100)
2. Non – availability of 45 30 25 10 15 125
securities (36) (24) (20) (8) (12) (100)
3. Measuring risk 50 35 20 15 5 125
(40) (28) (16) (12) (4) (100)
Total 125 125 125 125 125 125
Table 4.23
Problems in portfolio management.
Table 4.23 shows the ranking of factors indicating the degree of force with which the respondents
are influenced negatively. It shows that the constructing an optimal investment portfolio is the
most influencing factor which prevents the investors against making their investment.
Non-availability of securities is yet another factor which prevents the investor from making
investments (36 per cent). The availability of securities is therefore considered as the basic factor
for investment.
83
Chart 4.23
PROBLEMS IN PORTFOLIO MANAGEMENT
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Constructing an Non availability Measuring Risk
optimal investment
portfolio
84
4.24 Respondents Preference towards the sector in their Investment
Before selecting the portfolio the investors must confined their preferences regarding the sector.
Hence, sector is a most vital role in the portfolio investment. An attempt has been made further, to
know what are the positive factors which restrain the sample respondents from their portfolio
investment. This is shown in Table 4.24.
S.NO Preference Number of respondents Total

1 2 3 4 5
1. Product line 30 15 10 45 25 125
(24) (12) (8) (36) (20) (100)
2. Sector wise 25 30 40 10 20 125
(20) (24) (32) (8) (16) (100)
3. Business cycle wise 50 30 20 15 10 125
(40) (24) (16) (12) (8) (100)
Total 125 125 125 125 125 125
(100)
Table 4.24
Respondents preference towards the sector in their investment.
Table 4.24 shows the ranking of factors indicating the degree of force with which the respondents
are influenced positively. It shows that the preferences regarding constructing an optimal
investment portfolio is the most influencing factor which prevents the investors against making
their investment. Business cycle wise is yet another factor which prevents the investor from making
for investment.
85
Chart 4.24
PREFERENCE OF SECTOR FOR INVESTMENT
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Product line Sector wise Business cycle wise
86
4.25 Respondents Investment Experience of Primary Market :
In India the history of investment in shares and shareholding goes back to the pre-independence
period, but comprehensive data as share ownership were not available in India prior to the survey
conducted by L.C. Gupta on behalf of the society for capital market research and development in
1990. The shareholding population was very low in seventies; it registered 140 remarkable increase
mainly from eighties. The total number of share owning individuals at selected points in the year
1980 was 24 lakhs, 2009 but it increased to 203 lakhs in 2013. There was spectacular growth in
the number of share owning individuals during eighties and the new issue market played a key role
in widening the geographic distribution of shareowners. Most of the shareowners have made their
first entry into share investment is a subscription to new issues (i.e primary market) rather than
purchases on the stock exchanges (i.e secondary market). The respondents according to the years
of their presence or experience in the primary issue market are classified and presented in Table
4.25.
Experience Number of respondents Percentage

Upto 3 years 25 20
3 to 5 years 45 36
5 to 10 years 35 28
Above 10 20 16
Total 125 100
Table 4.25
Investment experience of respondents
Table 4.25 shows that 36 percent of the respondents have the market experience of 3 – 5 years and
28 percent of the total respondents have the experience of 5 – 10 years. Thus both the groups
constitute the majority 64 per cent of the total population. The investors experience is an important
factor in influencing their investment decision. The extent of the presence and association in the
market give some knowledge to understand the nature and make assessment of market conditions.
The respondents who have many years of experience in market with the period of above 10 years
are 16 per cent. 20 per cent of total respondents numbering 25 persons have the shortest experience
of up to 3 years.
87
Chart 4.25
INVESTMENT EXPERIENCE
50
45
40
35
30
25
20 Percentage
15
10
0
Upto 3 years 3 to 5 years 5 to 10 years Above 10
Experience
88
4.26 Quantum of Investment :
The household sector has three important savings and investment types viz., the saving scheme,
the fixed income corporate investments (including preference shares, debentures and fixed
deposits) and equity shares. While the investor can avail tax benefits under saving schemes and get
periodical fixed income from corporate investments, they do not protect the purchasing power of
the capital investor. Investment in equity share, especially of grown companies, which provide high
return, can protect the investor against the inflation. In general, the risk is high in equity investment
but the return is high. However equity investment provides a hedge against inflation, better liquidity
and marketability. Naturally small investors are attracted towards the equity shares. Respondents
investment in primary market ranges from the minimum level of 50000 to the maximum of above
Rs 3 lakhs. Respondents investments in primary market are shown in Table 4.26
S.NO Investment Investment Total

Below 1 – 2 2 – 3 Above
1 lakhs lakhs lakhs 3 lakhs
1. Below 50,000 35 45 25 20 125
(28) (36) (20) (16) (100)
2. 50,000 – 1,00,000 30 55 25 15 125
(24) (44) (20) (12) (100)
3. 1,00,000 – 2,00,000 40 50 20 15 125
(32) (40) (16) (12) (100)
4. Above 2,00,000 35 45 20 25 125
(28) (36) (16) (20) (100)
Total 125 125 125 125 125

(100)
Table 4.26
Quantum of investment.
(Figures in parentheses indicate percentages to total)
89
Table 4.26 shows that half of the respondents have investment in the category of 1 – 2 lakhs. In the
above 3 lakhs investment category the percentage of the respondents is meager. More than one
third of the respondents prefer to invest below 50000 in their investment. In the above 3 lakhs
investment category, only 16 per cent of the investors invest below 50000. The percentage of
respondents in the investment categories declines with the increase in investment in this particular
group. In the 50000 – 100000 investment category half of the respondents belong to investment
between 1 – 2 lakhs. Likewise 40 per cent of the respondents in the 1 – 2 lakhs investment category
belong to above mentioned group.
Chart 4.26
QUANTUM OF INVESTMENT
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Below 50,000 50,000 - 1,00,000 1,00,000 - Above 2,00,000
2,00,000
Below 1 lakhs 1 -2 lakhs 2 -3 lakhs Above 3 lakhs
90
4.27 Sources of Funds and Holding Period:
The sources of fund for investment affects the holding period. If own funds are invested, the
investors can have more retention power. At the same, if the borrowed funds are used for
investment in primary market, the cost of funds is always a cause of concern for the investors. The
sources of fund are classified into salary income, other sources and other sources. The sources of
funds and the holding period are shown in Table 4.27.
S.NO Sources of funds Holding period (in months ) Total

Upto 3 3–6 Above 6
1. Salary income 50 40 35 125
(40) (32) (28) (100)
2. Other sources 45 55 25 125
(36) (44) (20) (100)
3. Borrowed fund 50 30 45 125
(40) (24) (36) (100)
Total 125 125 125 125
Table 4.27
Sources of fund and holding period of investment
Table 4.27 shows that more than half of respondents utilized borrowed funds for their investment.
When borrowed funds are used for investment, the holding period capacity gets reduced. In the
borrowed funds category, 40 per cent of the respondents hold the stock less than three months.
Their holding period capacity is less than other groups. Respondents who had used that salary
income 28 per cent had a holding period above 6 months. This is the highest in the above 6 months
holding period category.
91
Chart 4.27
100%
90%
Holding period (in months) 80%
70%
60%
50% Above 6
40% 3 to 6
30% Upto 3
20%
10%
0%
Salary income Other sources Borrowed fund
Sources of fund
92
4.28 Sources of Fund and Respondents Preference about Level of return :
Sources of fund affect the investors expectation regarding return. If the investors utilize borrowed
funds they incur a cost. They need return higher and above the cost of funds. The particulars
regarding Sources of funds and preference of return level of the respondents are given in Table
4.28.
S.NO Sources of fund Return preference of respondents Total

Upto 20 20 – 30 Above 30
1. Salary income 55 40 30 125
(44) (32) (24) (100)
2. Other sources 40 25 60 125
(32) (20) (48) (100)
3. Borrowed fund 25 35 65 125
(20) (28) (52) (100)
Total 125 125 125
Table 4.28
Sources of fund and respondents preference about level of return.
The Table 4.28 shows that the 55 per cent of investors those who have income from salary income
had anticipated income below 20 per cent comparatively a smaller portion (24 per cent) of the
investor only expect income above 30 per cent. Borrowed funds category had higher expectations.
Half of the respondents preferred return above 30 per cent and only 20 per cent preferred low
return. They expected a high return because of the cost attached to the funds.
93
Chart 4.28
100
Return preference of respondents 90
80
70
60 Above 30
50
20-30
40
Upto 20
30
20
10
0
Salary income Others sources Borrowed fund
Sources of funds
94
4.29 Factors Determining the Return on Investment ( Rank the following ):
S.NO Factors 1 2 3 4 5 Total

1. Price of stock 40 25 30 20 10 125
2. Type of stock 35 25 15 40 10 125
3. Issue price of the stock 40 10 25 30 20 125
4. Reserve for dividend 50 30 25 15 5 125
5. Future projects of the company 30 55 25 10 5 125
6. Goodwill of the company 60 25 30 10 - 125
7. Government rules and policies 50 30 25 15 5 125
Table 4.29
Factors determining the return on
investment
In table 4.29 , 40 respondents have ranked 1 for price of stock and 5 respondents have ranked it
on number 5. For type of stock 35 respondents have ranked 1 and most of respondents have ranked
it on number 4 . for issue price of stock most of the respondents have ranked it on number
1(40respondents ) and least number of respondents have ranked it on number 2 (10respondents ) .
For reserve of dividend 50 respondents have ranked it on number 1 and for future projects of
company 55 respondents have ranked it on 2 and for goodwill of the company and government
rules and policies most of respondents have ranked it on number 1.
Chart 4.29
95
RETURN ON INVESTMENT
140
120
100
80
Rank 5
60
Rank 4
40 Rank 3
20 Rank 2
Rank 1
0
96
4.30 Loss Tolerance Level :
S.NO Loss tolerance level Number of respondents Percentage

1. Upto 10% 60 48
2. 10% - 20% 45 36
3. 20% - 30% 20 16
Total 125 100
Table 4.30
Respondents loss tolerance level.
In table 4.30 , most of respondents loss tolerance level is upto 10% (48 percent ) and for 10% -
20% the loss tolerance level of respondents is 36 percent and for 20% -30% the least number of
respondents loss tolerance level is 16 percent.
Chart 4.30
70
60
50
40
30
Percentage
20
10
0
Upto 10 % 10% - 20% 20% - 30%
Loss tolerance level
97
4.31 Problems Faced by the Respondents :
S.NO Problems 1 2 3 4 5 Total
1. Poor return 45 25 30 15 10 125
(36) (20) (24) (12) (8) (100)
2. Huge money required and 55 30 20 15 5 125
locked (44) (24) (16) (12) (4) (100)
3. No allotment or poor 30 15 45 25 10 125
allotment (24) (12) (36) (20) (8) (100)
4. Highly volatile market 30 50 15 5 25 125
(24) (40) (12) (4) (20) (100)
5. Deviation from the assured 25 30 40 20 10 125
future plans (20) (24) (32) (16) (8) (100)
6. Brokers intervention 50 30 10 15 20 125
(40) (24) (8) (12) (16) (100)
7. Government policies 30 50 25 15 5 125
(24) (40) (20) (12) (4) (100)
8. Cumbersome procedures 25 20 15 45 20 125
(20) (16) (12) (36) (16) (100)
Table 4.31
Problems faced by the respondents.
In table 4.31 , 36 percent of respondents feels that they get poor return , 44 percent of respondents
feels that huge money is required and locked , 36 percent of respondents thinks that there is poor
allotment , 40 percent of the respondents feels that the market is highly volatile , 32 percent of the
respondents feels that there is a deviation from the assured future plans ,40 percent of respondents
feels that there is brokers intervention ,40 percent of the respondents thinks that the government
policies is a problem while investing funds , 36 percent of respondents thinks that cumbersome
procedures affects the return on investment .
98
Chart 4.31
PROBLEMS FACED BY RESPONDENTS
100
90
80
70
60
50
40
Rank 5
30
20 Rank 4
10 Rank 3
0
Rank 2
Rank 1
99
CHAPTER V
SUMMARY OF FINDINGS AND CONCLUSION.
5.1 INTRODUCTION :
Savings and investment are the two important phenomenon essentially required for an economy
and its development. In India, household is the saving sector whose surplus is required for
investment purpose by the government and corporate sectors. In the process of transformation of
savings into investment, the capital market and money market plays a significant role in the
generation of funds for investment with direct participation of investors. The present study has
been undertaken with the objectives to document the growth and development of various
investment opportunities, awareness and pattern of investment, analyze factors influencing
investment decisions, evaluate the risk and return on various investment and examine the various
problem faced by the investors The findings of the study are presented in this chapter .
5.2 FINDINGS :
I . Personal Factors of the Investors in Study Area:
1.Age: The majority of the respondent of the study fall in to the age group of 31 to 45 years who
account for 47.3 per cent of total respondents.
2.Educational Status : Among the respondents having different educational background half of
the investors were the graduates accounting 48 per cent. Investors below the graduate level were
8.7per cent which is the lowest.
3. Designation : Majority of the respondents is Senior clerks and clerks and they account for
about 36 per cent of the total respondents. Accountants are 16 per cent, occupying the second
place. The managers and assistant mangers occupy the third place with 20 per cent.
4. Family Size : The respondents with the family size of 3 to 4 members form the largest group
accounting 32 per cent of total respondents.
100
5. Annual Income of the Respondents :The annual income of majority of the respondents
ranges between 3 to 4 lakhs. They account for 24 per cent.
6. Sources of Income of the Respondents : Only 40 per cent of the respondents resort to rely
on borrowed funds. As against this, 56 per cent of respondents numbering resort to borrowing by
which they can be said as having speculative tendency in their investment activity.
7. Savings per month of the respondent :The respondents those who save above 10000 were
40per cent.
8. Wealth-Holding of Respondents :The wealth holding size of more than one third of the
respondents (48 per cent) ranges between 35 lakhs and 50 lakhs.
II. Factors Influencing the Investors Decision in Primary Issue Market :
1.Investment Decision : Out of 125 respondents one-third of them invest their fund, 40 per cent
of them are investing in the area of contingent and rests of them invest titular form.
2. Real Investments or Tangible Investment: Out of 40respondents majority of them invest

their fund in the form of real estate such as land, houses, plots etc, 30 per cent of them are invest
in the area of jewellery and rest of them invest in the form of silver and precious materials.
3. Contingent Investment: Out of 50 respondents 38 per cent of them are select the money back
policies, 20 of them select whole life assurance plan and 18 per cent of them selected Bima Plus.
4. Titular Investments : Out of 30 respondents 36 per cent of them choose bank deposits, 26.6
per cent of them select provident fund schemes and the remaining of them occupy next places.
5.Nature of Deposits : More than 36 per cent of the respondents are invest bank deposit form, 18
per cent of them are select fixed deposits and the remaining of them select next options.
6.Post Office Schemes: Out of 2 respondents near one-third of the respondents are select
national savings certificates and recurring deposits. No one can select the public provident fund
scheme in post office because it is not giving tax benefits to the respondents.
7. Provident Fund Schemes : All the 8 respondents are investing only recognized provident
fund only.
101
8. Mutual Fund : Out of 4 respondents 60 per cent of them are select Yield and investment
pattern schemes and the remaining of them are select Basis of execution and operation.
9. Government Securities : More than 50 per cent of the respondents desire stock certificates
and the rest of the 50 per cent of them craving promissory notes.
10.Investment Portfolio : Mainly cash/bank deposits with a small portion invested in low risk
investments, A mix of debt instruments, blue chip and aggressive stocks, Mainly aggressive
stocks and high-yield debt funds and mostly speculative or high risk investments have acquired
second, third, fourth and fifth ranks respectively.
11. Portfolio Management: Planning ranks first rank on the basis of the calculated intensity
value. Timing of investment, Conservatism and Rationalism, Close Monitoring of Investment and
Performance Appraisal have acquired second, third, fourth and fifth ranks respectively.
12. Principles of Portfolio Management : The respondents attach returns in their investments
as 45 per cent of the respondents ranked in first in their order of preferences. Following it,
taxability which is represented by tax benefits ranked second and 50 per cent of respondents gave
first rank to it. In third place, 40 per cent of respondents want stability of price. Liquidity of
investment occupy fourth place with 30 per cent first rank score. Safety of funds, capital growth,
diversification and marketability placed next ranks.
13. Problems in Portfolio Management: The ranking of factors indicating the degree of force
with which the respondents are influenced negatively. It shows that the constructing an optimal
investment portfolio is the most influencing factor which prevents the investors against making
their investment. Non-availability of securities is yet another factor which prevents the investor
from making investments (36per cent). The availability of securities is therefore considered as the
basic factor for investment.
14. Sector of Investment :The preferences regarding constructing an optimal investment

portfolio is the most influencing factor which prevents the investors against making their
investment. Business cycle wise is yet another factor which prevents the investor from making
for investment.
15. Investment Experience : Investors with 3 years experience category want to play safely in
primary market. In this category 16 per cent of them have their investment below 50000 in
102
investment market. In the same category only 16 per cent of them are present in the above 3 lakhs
investment market investment group .
16. Respondents Preference of Holding Period : In the professional group, largest percentage
of respondents had holding period upto 3 months. Only 32 per cent of salary category
respondents wanted to hold their shares more than six months and salaried category nearly one-
third of them had holding their allotment above six months.
17. Sources of Funds and Return : 55 per cent of the respondents those who earn income from
salary source had an anticipated income below 20 per cent where as borrowed funds category had
higher expectations. In case of other sources category respondents prefer their investment return
above 30 per cent.
18. Investors Problems in Investing their Investments : An attempt is made to analyze the
investors problems in investing their investments. The responses were collected through a
questionnaire contains eight statements relating to the investors problems in investing their
investments. The responses of the sample respondents of 125to the eight statements have been
recorded.
5.3 SUGGESTIONS :
In the light of foregoing analysis and findings of the study, the following practical suggestions
are given for the improvement of investment market in general and revival of investors
confidence in particular. As the cash reserve ratio is maintained by the scheduled banks with RBI
for ensuring their liquidity performance, all the corporate making public issues may be
compulsorily required to maintain Equity Reserve Ratio (ERR) either in separate account
maintained by SEBI or any of its representative authority to be created especially for this
purpose. It would help to create confidence among investors and responsibility among issuing
corporate at least at minimum level.
SEBI must be given more powers especially to deal with the defaulting companies and bring
them to book. As the delisting of defaulting companies severely affect the interest of investing
public and shareholders, SEBI may find a mechanism of imposing partial and specific sanctions
on certain areas of mismanagement of funds and financial activities.
103
SEBI shall consider the viability of this idea seriously for which separate vigilant and
investigation wing or committee may be set up. To curtail the speculative activities of the
intermediaries in public issues, a wide publicity may be given to create awareness among public
of such ill-motivated intermediaries. It would send a strong signal to the managers and
intermediaries not to resort to such game role at least in future.
As in secondary market at present, it may try and examined the viability of introducing the
public issues through online digital system throughout the country. To boost the morale of the
investing public in new public issues, if necessary in selected sector, a one-time waiver or
exemption may be granted from capital gains tax for the investors. Where the investors have to
incur loss in case of high premium issue and due to default of the company, the company must be
held responsible for paying the amount at least equivalent to par value to its investors. It would
mitigate the loss to some extent for the investors and create sense of responsibility among the
issuing corporate.
Investors forum may be encouraged and SEBI may channelize its investors education and
information services through these forums which must be registered and which must have the
continuance of proceedings record.
Non-Government Organizations role and services may be welcomed and utilized in this regard.
Before entering into the stock market, the investors have to learn a complete knowledge about the
stock market. The investor has to invest their money in less risky securities like mutual fund,
debenture. Since the above securities have a minimum risk. While comparing equity shares. The
gold investors can prefer the gold bars or gold coins because it has no wastages.
The real estate investors can purchase urban land because it will have increase in value day by
day. Post office may offer more savings schemes compared with banks. So that, the investors can
properly invests their money in postal schemes. If the investors preferred to cover their risk of life
and to get tax benefits they can choose the insurance schemes.
104
5.4 CONCLUSION :
“No pain no gain” it is the golden principle of investment management. In this fast moving
world, we can earn more and more money. More risk leads to more profit. Investors cannot
avoid risk but they can minimize the risk by investing their money in various forms of
investments so that they can get a moderate profit. Rational investment and quick decisions
are needed to beat the new issue market and reap good returns.
105
CHAPTER VI
BIBLIOGRAPHY.
6.1 BOOKS:
Avadhani V.A., Investment and Securities Markets in India, Himalaya Publishing House,
2009, p.186.
C.R.Kothari, New Age International (P) Ltd, Publishers, New Delhi, 1990, p.180. Donald E
Fisher and Donald Jordan, Security Analysis and Portfolio Management, PrenticeHall of
India (P) Ltd, New Delhi, 1995, p.265
Punithavathy Pandian, Security Analysis and Portfolio Management, Vikas Publishing
House Pvt Ltd, New Delhi, 2003, p.214.
S.P.Gupta, Statistical Methods, Sultan Chand & Sons, New Delhi, 2010, p.376.
6.2JOURNALS :
Myers, „Pattern of Investment Strategy and Behaviour among Individual Investors”, Journal
of Business, Vol.3, No.7, 1977, pp.296-333.
Colin M. Mason and Richard T. Harrison, “The Effect of Financial Ratios on Returns
form Initial Public Offerings: An Application of Principal Component Analysis”,
International Journal of Management, Vol.23, No.1, 2002, pp.187-194.
Akiko Kamesaka, John R. Nofsinger and Hidetaka Kawakita “A Case at last for
Agephased Reduction in Equity”, Proceedings of the National Academy of Science, Vol.86,
No.34, 2003, pp.9048-9051.
Dr. Odoemenem Saving and Investment Pattern of Small-Scale Farmers of Benue State,
Nigeria‟. Multinational Finance Journal, Vol.2, No.3, 1998, pp.225-244.
Philip R. Lane and Gian Maria Milesi-Ferretti “The Price Behaviour of Initial Public
Offerings on the Taiwan Stock Exchange”, Applied Financial Economics, Vol3, No.4, 1999,
pp.201-208.
106
6.3 APPENDIX :
Interview Schedule:
I. Personal Factors of the Respondent:
1. Name (optional):
2. Sex :
3. Age :
4. Educational Status :
Educational status Yes /

No
Graduate
Post graduate
Professional
5. Name of the Bank where employed :
6. Designation :
Designations Yes /
no
Manager
Assistant manager
Accountants
Senior clerk
Clerk
7. Annual Income ( ) :
Income( in lakhs ) Yes /no
107
Upto 3 lakhs
3 – 4 lakhs
Above 5 lakhs
8. Savings per month ( ) :
Savings per month (in Yes /no

lakhs )
Upto 5000
5001 – 7500
7500 – 10,000
Above 10,000
9. Marital Status :
Marital status Yes /no

Married
Unmarried
Widow
Separate
10. Number of dependents :
II. Decision of investment awareness and pattern of the respondents :
1. Investment Alternatives :
i) Real investment or tangible investments
a. Real Estate.
b. Jewellery.
c. Silver & Precious materials.
108
ii) Contingent Investment ( Insurance Policy )
a. Whole Life Assurance Plan.

b. Endowment Assurance Plan.
c. Jeevan Anurag Plan.
d. Jeevan Nidhi Plan.
e. Keyman Insurance Plan.
f. Jeevan Mitra.
g. Jeevan Saral.
h. Jeevan Adhar.
i. Money Back Policy.
j. Bima Plus.
iii) Titular Investments
A) Deposits
a. Bank Deposits
b. Recurring Deposit
c. Fixed Deposit Schemes
d. Novel Deposit Schemes
B) Post Office Schemes
a. Bank Deposits
b. Post Office Schemes
c. Fixed Deposit Schemes in Companies
d. Provident Fund Schemes
e. Mutual Fund Schemes
f. Government Securities
C) Fixed Deposits in Companies
D) Provident Fund Scheme
a. Recognized Provident Fund

b. Unrecognized Provident Fund
c. Public Provident Fund
109
E ) Mutual Fund
i. Basis of execution and operation

ii. Yield and investment pattern
a. If you select basis of execution and operation select the following :

i. Close ended
ii. Open ended
b. If you select the basis of yield and investment pattern select the following :
a) Income fund
b) Growth fund
c) Balance fund
d) Specialized Mutual fund
e) Money market
f) Taxation fund
F) Government Securities
a. Promissory notes
b. Stock certificate
3. Your Current Investment Portfolio comprises of ( Rank the Following )
Rank 1 : Strongly Agree. Rank 2 : Agree. Rank 3: In between. Rank 4: Disagree. Rank 5:
Strongly Disagree .
S.NO Factors 1 2 3 4 5
1. Mainly cash/bank deposits with a small portion invested in
low risk investments
2. Mainly debt market investments (bonds, Mutual Funds)
and some portion in blue chip stocks
3. A mix of debt instruments, blue chip and aggressive stocks
4. Mainly aggressive stocks and high-yield debt Funds
5. Mostly speculative or high risk investment
4. Factors Influencing Portfolio Management ( rank the following )

110
Strongly Disagree .
1. Planning
2. Timing of investment
3. Conservatism and rationalism
4. Close monitoring of investment
5. Performance appraisal
5. Principles of Portfolio Management ( Rank the following ):
Strongly Disagree .
S.NO Principles 1 2 3 4 5
1. Safety of funds
2. Stability of
price
3. Liquidity
4. Returns
5. Capital growth
6. Marketability
7. Diversification
8. Taxability
5. Problems in Portfolio Management
a) Constructing an optimal investment portfolio
b) Non-availability of securities
c) Measuring risk
6. What type of sectors do you want to invest ?
111
a) Product line (manufacturing, services etc.,)
b) Sector wise (Agriculture, mining, IT etc.,)
c) Business Cycle wise
III. Risk and Return:
1. Investment Experience in years
2. Quantum of Investment per year
3. Sources of Income
a) Salary income b) Other Sources c) Borrowed Fund
4. Holding period of Investments (in months)
5. Your preference as to level of Return (in %)
a) Below 20% b) 20% – 30 % c) Above 30%
6. Factors determining the return on investment ( Rank the following )
Strongly Disagree .
1. Price of the stock
2. Type of the stock
3. Issue price of the stock
4. Reserve for dividend
5. Future projects of the company
6. Goodwill of the company
7. Government rules and policies
7. What is your Tolerance Level (in % )
a. Upto 10%
b. 10 – 20 %
112
c. 20 – 30 %
IV . Problems faced by the respondents ( Rank the following )
Strongly Disagree .
S.NO Problems 1 2 3 4 5
1. Poor return
2. Huge money required and locked
3. No allotment or poor allotment
4. Highly volatile market
5. Deviation from assured future plans
6. Brokers intervention
7. Government policies
8. Cumbersome procedures
113

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CHAPTER I

INTRODUCTION TO INVESTMENT PATTERN OF PUBLIC

❖ Emergence of public sector banks

❖ Before the economic liberalization

❖ Liberalisation in the 2000s

1.2DIFFERENT LEVELS AND POSTS IN PUBLIC SECTOR BANKS

The following the managerial hierarchy in nationalized bank in india:

FROM TOP TO BOTTOM:

1. CHAIRMAN AND MANAGING DIRECTOR :

3.CHIEF GENERAL MANAGER :

1.( ONLY IN LARGE BANKS )- TOP EXECUTIVE- SCALE VIII:

2..GENERAL MANGER- EXECUTIVE – SCALE VII:

❖ Managing the performance of each employee.

3.DEPUTY GENERAL MANAGER – EXECUTIVE –SCALE VI:

4.ASSISTANT GENERAL MANAGER –SENIOR MANAGEMENT – SCALE V:

5..DIVISIONAL MANAGER / CHIF MANAGER- SENIOR MANAGEMENT – SCALE IV:

6.SENIOR MANAGER – MIDDLE MANAGEMENT – SCALE III:

7.MANAGER – MIDDLE MANAGEMENT – SCALE II:

8. OFFICER – JUNIOR MANAGEMENT – SCALE I:

9.CLERK – SCALE “0”:

❖ Process Customer Transactions.

1.3COMPENSATION AND INCENTIVES:

.The Indian bank PO salary varies for various posts like :

1.Bank PO salary for SBI.

1. Bank Clerk Salary – SBI.

1.SBI Clerk Salary:

Rs. 11765-655/3-13730-815/3-16175-980/4-20095-1145/7-28110-2120/1-30230-1310/1- 31540.

2.IBPS Clerk Salary:

The IBPS Clerk salary structure is as follows:

• The basic IBPS clerk salary is Rs 11,765- Rs 42,020 per month.

III .IBPS RRB Salary:

The IBPS RRB salary details are as follows:

Officer Scale I Rs 30000- Rs 36000

Officer Scale-II Rs 36000- Rs 42000

Officer Scale III Rs 41000- Rs 47000

The bank SO salary for the various banks are as follows:

1. Junior Management Grade Scale (JMGS) I

The following are the pay scales for these grades:

• The salary structure of Officer Scale I is in the range of Rs. 23700-980/7-30560-1145/2-

• The salary structure of Officer Scale-II is in the range of Rs. 31705-1145/1-32850-1310/10-

1.4.Various investments option open for employees :

2.Equity mutual funds

3.Debt mutual funds

Investment Options in India

4.National Pension System(NPS)

5. Public Provident Fund (PPF)

6. Bank fixed deposit (FD)

7. Senior Citizens' Saving Scheme (SCSS)

8. RBI Taxable Bonds

12.Post office savings

1.5 NAVI MUMBAI BRANCHES OF PUBLIC SECTOR BANK

1.STATE BANK OF INDIA , PANVEL .

2..VIJAYA BANK , NEW PANVEL .

3.INDIAN BANK , KALAMBOLI .

4.ORIENTAL BANK OF COMMERCE , KHARGHAR .

5.RAIGAD DISTRICT CENTRAL CO-OPERATION BANK , NEW PANVEL .

7.RATANAKAR BANK LTD , NERUL.

8.INDIAN OVERSEAS BANK ,VASHI .

9.CANARA BANK , KHARGHAR .

10.CORPORATION BANK , VASHI .

11.DENA BANK , AIROLI .

12.KARNATAKA BANK , BELAPUR .

13.BANK OF INDIA , NERUL .

14.BANK OF MAHARASHTRA,NEW PANVEL .