Project report of axis mutual fund by kamal

A PROJECT REPORT
ON

“CHANNEL MANAGEMENT OF
AXIS MUTUALFUND
AND
ANALYSING PREFERENCES OF THE INVESTORS
FOR INVESTMENT IN MUTUAL FUNDS”

AT
AXIS ASSET MANAGEMENT COMPANY LTD.
JAIPUR

BY
KAMLESH SHARMA

FOR THE PARTIAL FULFILLMENT OF THE COURSE
PGDM [BUSINESS ADMINISTRATION]

MITCON INSTITUTE OF MANAGEMENT
BALEWADI, PUNE - 411045
2011 – 2013

DECLARATION

I HEREBY DECLARE THAT THIS PROJECT TITLED

CHANNEL MANAGEMENT OF AXIS MUTUAL FUND AND ANALYSING
PREFERENCES OF THE INVESTORS FOR INVESTMENT IN MUTUAL FUNDS

IS SUBMITTED IN PARTIAL FULFILLMENT OF THE POST GRADUATE
DIPLOMA IN MANAGEMENT (PGDM) TO MITCON INSTITUTE OF
MANAGEMENT, PUNE AS A FINAL PROJECT.

Project Guide:
Faculty Guide: Ms.AditiGosain
Company Guide: Mr.Ashish Sharma

Date: 06-July-2012 Kamlesh Sharma
PGDM

ACKNOWLEDGEMENT

I put myself in humblest desk in order to give the same measure and recognition to all
those who have instrumental through out the entire process of carrying out this project
report. I would like to take this opportunity to acknowledge and thanks to Axis Asset
Management Company Ltd. Jaipur for providing me this highly coveted opportunity to
associate my summer internship project with the organisation of national repute.
I am very thankful to my faculty guide Ms. AditiGosainfor constant support and
encouragement as well as the valuable guidance and direction. She has provided the
information to complete my project report.

My special thanks and heartiest gratitude flows to Mr.Sandeshjoshi (Branch Manager),
Mr.DevendraSaini (Regional Head), Mr.Ashish Sharma (Sr. Relationship Manager),
Mr.VineetMathur (Sr. Relationship Manager), Ms.Poorva Jain (Investor service)Axis
Mutual Fund, Jaipur. Their help in various capacities towards making me familiarwith the
research problem and preparing the report is invaluable. Their knowledge, nature and
judgement along with their experience were an immense source of inspiration in
completing this project.

I was indeed an enriching experience for me as a management student for getting a chance
to do a project in an organization of international repute like AXIS AMC.

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EXECUTIVE SUMMARY

In few years Mutual Fund has emerged as a tool for ensuring one‟s financial well being.
Mutual Funds have not only contributed to the India growth story but have also helped
families tap into the success of Indian Industry. As information and awareness is rising
more and more people are enjoying the benefits of investing in mutual funds. The main
reason the number of retail mutual fund investors remains small is that nine in ten people
with incomes in India do not know that mutual funds exist. But once people are aware of
mutual fund investment opportunities, the number who decide to invest in mutual funds
increases to as many as one in five people. The trick for converting a person with no
knowledge of mutual funds to a new Mutual Fund customer is to understand which of the
potential investors are more likely to buy mutual funds and to use the right arguments in
the sales process that customers will accept as important and relevant to their decision.

This Project gave me a great learning experience and at the same time it gave me enough
scope to implement my analytical ability. The analysis and advice presented in this Project
Report is based on market research on the saving and investment practices of the investors
and preferences of the investors for investment in Mutual Funds. This Report will help to
know about the investors‟ Preferences in Mutual Fund means Are they prefer any
particular Asset Management Company (AMC), Which type of Product they prefer, Which
Option (Growth or Dividend) they prefer or Which Investment Strategy they follow
(Systematic Investment Plan or One time Plan). This Project as a whole can be divided into
two parts.

The first part gives an insight about Mutual Fund and its various aspects, the Company
Profile, Objectives of the study, Channel Management and Research Methodology. One
can have a brief knowledge about Mutual Fund and its basics through the Project.

The second part of the Project consists of data and its analysis collected through survey
done on 200 people. For the collection of Primary data I made a questionnaire and
surveyed of 200 people. I also taken interview of many People those who were coming
at the Axis Bank Branch where I done my Project. I visited other AMCs in Jaipur to get
some knowledge related to my topic. I studied about the products and strategies of
other AMCs in Jaipur to know why people prefer to invest in those AMCs. This
Project covers the topic “Channel Management Of Axis Mutual Fund And Analysing
Preferences Of The Investors For Investment In Mutual Funds” The data collected has
been well organized and presented. I hope the research findings and conclusion will be
of use.

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TABLE OF CONTENTS

Ref No TITLES Page No.

iii ACKNOWLEDGEMENT 3
iv EXECUTIVE SUMMARY 4
1. INDUSTRY PROFILE 7
1.1 Mutual Funds Concept 8
1.2 Mutual Fund Industry in India 14
1.3 Association of Mutual Funds in India (AMFI) 19
2. COMPANY PROFILE 22
2.1 Company Overview 23
2.2 SWOT 27
2.3 Schemes of Axis AMC 29
3. OBJECTIVE 36
4. CHANNEL MANAGEMENT OF AXIS AMC 38
4.1 Chart On Channel Management 39
4.2 Work for Axis Channel Management 40
5. RESEARCH METHODOLOGY 41

5.1 Methodology 42
5.2 Sampling 43
6. DATA PRESENTATION AND ANALYSIS 44
7. SUGGESTIONS AND RECOMMENDATIONS 65

8. LIMITATIONS AND SCOPE 68

9. CONCLUSION 71

10. ANNEXURE 75
10.1 Questionnaire 76
10.2 Bibliography 80

Chapter-1

Industry Profile

MUTUAL FUND CONCEPT
7

A Mutual Fund is a trust that pools the savings of a number of investors who share a
common financial goal. The money thus collected is then invested in capital market
instruments such as shares, debentures and other securities. The income earned through
these investments and the capital appreciation realized is shared by its unit holders in
proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable
investment for the common man as it offers an opportunity to invest in a diversified,
professionally managed basket of securities at a relatively low cost. The flow chart below
describes broadly the working of a mutual fund:

The flow chart below describes broadly the working of a mutual fund:

A Mutual Fund is a trust that pools the savings of a number of investors who share
common financial goal; investments may be in shares, debt securities, money market
securities or a combination of these. Those securities are professionally managed on behalf
of the unit-holders, and each investor holds a pro-rata share of the portfolio i.e. entitled to
any profits when the securities are sold, but subject to any losses in value as well.

The income earned through these investments and the capital appreciations realized are
shared by its unit holders in proportion to the number of units owned by them. Thus a
Mutual Fund is the most suitable investment for the common man as it offers an
opportunity to invest in a diversified, professionally managed basket of securities at a
relatively low cost.
Reasons to invest in mutual funds :

Expert on your side: When you invest in a mutual fund, you buy into the
experience and skills of a fund manager and an army of professional analysts

Limited risk: Mutual funds are diversification in action and hence do not rely on the
performance of a single entity.

More for less: For the price of one blue chip stock for instance, you could get
yourself a number of units across a number of companies and industries when you
invest in a fund!

Easy investing: You can invest in a mutual fund with as little as Rs. 5,000. Salaried
individuals also have the option of investing in a monthly savings plan.
Convenience: You can invest directly with a fund house, or through your bank or
financial adviser, or even over the internet.

Investor protection: A mutual fund in India is registered with SEBI, which also
monitors the operations of the fund to protect your interests.

Quick access to your money: It's good to know that should you need your money at
short notice, you can usually get it in four working days.

Transparency: As an investor, you get updates on the value of your units,
information on specific investments made by the mutual fund and the fund
manager's strategy and outlook.

Low transaction costs: A mutual fund, by sheer scale of its investments is able to
carry out cost-effective brokerage transactions.

Tax benefits: Over the years, tax policies on mutual funds have been favourable to
investors and continue to be so.

Organization of a Mutual Fund

9

Sponsor :

Sponsor is the person who acting alone or in combination with another body corporate
establishes a mutual fund. The sponsor of a fund is akin to promoter of a company as he
gets the fund registered with SEBI. The sponsor will form a Trust and appoint a Board of
Trustees. The sponsor will also generally appoint as Asset Management Company as fund
managers. The sponsor, either directly or acting through the Trustees, will also appoint a
Custodian to hold the fund asset. All these appointments are made in accordance with
SEBI Regulations.

Sponsor must contribute at least 40% of the net worth of the Investment Managed and
meet the eligibility criteria prescribed under the Securities and Exchange Board of India
(Mutual Funds) Regulations, 1996.The Sponsor is not responsible or liable for any loss or
shortfall resulting from the operation of the Schemes beyond the initial contribution made
by it towards setting up of the Mutual Fund.

Trust :

The Mutual Fund in India is constituted in the form of a public Trust created under the
Indian Trustees Act, 1882. The fund sponsor acts as the settler of the trust, contributing to
its initial capital, and appoints Trustees to hold the asset of the Trust for the benefit of the

unit holders, who are the beneficiaries of the Trust. The fund then invites investors to
contribute their money in the common pool, by subscribing to „‟Units‟‟ issued by various
schemes established by the trust, units being the evidence of their beneficial interest in the
fund.

It should be understood that a mutual fund is just „‟ a pass-through‟‟ vehicle. Under the
Indian trusts Act, or the fund has no independent legal capacity itself, rather it is the
Trustee or Trustees who have the legal capacity and therefore all acts in relation to the
trust are taken on its behalf by the Trustees. The Trustees hold the unit holder‟s money in a
fiduciary capacity, i.e the money belongs to the unit – holders and is entrusted to the fund
for the purpose of investment. In legal parlance, the investor or the unit-holders are the
„‟beneficial owners‟‟ of the investment held by the Trust, even as these investments are
held in the name of the trustees on a day – to - day basis.

Being public Trusts, mutual fund can invite any number of investors as beneficial owners
in their investment schemes.

Trustee:

The trust – the mutual fund – may be a Board of Trustees – a body of individuals, or a
Trust company – a corporate body. Most of the funds in India are managed by Board of
Trustees. While the board of Trustees is governed by the provisions of the Indian Trusts
Act, where the Trustee is a corporate body, it would also be required to comply with the
provisions of the companies Act, 1956. The Board or the Trustee Company, as an
independent body, act as protector of the unit – holder‟s interests. The Trustee doesn‟t
directly manage the portfolio of securities. For this specialist function, they appoint an
Asset Management Company. They ensure that the fund is managed by the AMC as per
the defined objectives and in accordance with the Trust Deed and SEBI regulations.

The trust is created through a document called the Trust Deed that is executed by the fund
sponsor in favour of the Trustees. Trust Deed is required to be stamped as registered under
the provisions of the Indian Registration Act and registered with SEBI. Clauses in the
Trust Deed, inter alia, deal with the establishment of the Trust, the appointment of
Trustees, their powers and duties, and the obligations of the Trustees towards the unit-
holders and AMC. These clauses also specify activities that the fund/ AMC cannot

11

undertake. The third schedule of the SEBI (MF) Regulations, 1996 specifies the contents
of the Trust Deed.

The Trustees being the primary guardians of the unit-holders‟ funds and assets, a Trustee
has to be a person of high repute and integrity. SEBI has laid down a set of conditions to be
fulfilled by the individuals being proposed as trustees of mutual funds – independent and
non - independent. Besides specifying the „‟disqualifications‟‟, SEBI has also set down the
Right and obligations of the Trustees. Broadly, the Trustees must ensure that the investors‟
interests are safeguarded and that the AMC‟s operations are along professional lines. They
must also ensure that the management of the fund is in accordance with SEBI Regulations.
To ensure the independence of the trustee company, SEBI mandates a minimum of two-
third independent directors on the board of the trustee company.

Asset Management Company (AMC) :

The role of an AMC is to act the investment manager of the Trust. The sponsors or the
trustees, if so authorized by the Trust Deed, appoint the AMC. The AMC so appointed is
required to be approved by SEBI. Once approved, the AMC functions under the
supervision of its own Board of Directors, and also under the directions of the Trustees and
SEBI. The Trustees are empowered to terminate the appointment of the AMC and appoint
a new AMC with the prior approval of SEBI and unit-holders

The AMC would, in the name of the Trust, float and then manage the different investment
„‟schemes‟‟ as per SEBI Regulations and as per the Investment Management Agreement it
signs with the Trustees. Mutual fund Regulations,1996 describes the issues relevant to
appointment, eligibility criteria, and restrictions on business activities and obligations of
the AMC.

The AMC of a mutual fund must have a net worth of at least Rs. 10 crores at all times.
Directors of the AMC, both independent and non independent, should have adequate
professional experience in financial services and should be individuals of high moral
standing, a condition also applicable to other key personnel of the AMC. The AMC cannot
act as a trustee of any other mutual fund. Besides its role as the fund manager, it may
undertake specified activities such as advisory services and financial consulting, provided
these activities are run independently of one another and the AMC‟s resources are properly

segregated by activity. The AMC must always act in the interest of the unit-holders and
report to the trustees with respect to its activities. To ensure the independence of the asset
management company, SEBI mandates that a minimum of 50% of the directors of the
board of the asset management company should be independent directors.

Registrar and Transfer Agent :

The AMC if so authorized by the Trust Deed appoints the Registrar and Transfer Agent to
the Mutual Fund. The Registrar processes the application form; redemption requests and
dispatches account statements to the unit holders. The Registrar and Transfer agent also
handles communications with investors and updates investor records.

Custodian :

Mutual funds are in the business of buying and selling of securities in large volumes.
Handling these securities in terms of physical delivery and eventual safekeeping is
therefore a specialized activity. The custodian is appointed by the Board of Trustees for
safe keeping of physical securities or participating in any clearing systemthrough approved
depository companies on behalf of mutual fund in case of dematerialized securities. A
custodian must fulfill its responsibilities in accordance with its agreement with the mutual
fund. The custodian should be an entity independent of the sponsers and is required to be
registered with SEBI.

MUTUAL FUND INDESTRY IN INDIA

13

Origin of mutual fund industry in India is with the introduction of the concept of mutual fund by
UTI in the year 1963. Though the growth was slow, but it accelerated from the year 1987 when
non-UTI players entered the industry.
In the past decade, Indian mutual fund industry had seen a dramatic improvement, both qualities
wise as well as quantity wise. Before, the monopoly of the market had seen an ending phase; the
Assets under Management (AUM) were Rs. 67bn. The private sector entry to the fund family
raised the AUM to Rs. 470 bn in March 1993 and till April 2004; it reached the height of 1,540 bn.

Putting the AUM of the Indian Mutual Funds Industry into comparison, the total of it is less than
the deposits of SBI alone, constitute less than 11% of the total deposits held by the Indian banking
industry.

The main reason of its poor growth is that the mutual fund industry in India is new in the country.
Large sections of Indian investors are yet to be intellectuated with the concept. Hence, it is the
prime responsibility of all mutual fund companies, to market the product correctly abreast of
selling.

The Indian mutual funds industry was non – existent till 1960s. in 1963, the govt. of India
took the initiative by passing the UTI Act, under which the Unit Trust of India (UTI) was
set –up as a statutory body. The designated role of UTI was to act as a mutual fund. This
was expanded in 1985 to make UTI a financial institution as well.

UTI‟s first scheme, called the US-64, which was an open –end scheme, was launched in
1964. It subsequently launched a number of schemes to suit the differing needs of the
investors. Till 1987, UTI was the only mutual fund in the market since no one else was
legally allowed to set –up mutual fund. In 1987, other public sector institutions like banks,
financial institutions and insurance companies started establishing mutual fund, following
the government‟s decision to allow them to do so. State Bank of India became the first one
to launch a mutual fund when it launched the SBI Mutual fund in November, 1987. It was
followed by the Can bank mutual fund, LIC Mutual fund, etc. In this regulated era, UTI

was acting more as a vehicle for the implementation of the economic policies and the
developmental activities of the government, than as an investment vehicle for the investors.

Finally in 1992, the government allowed private sector players to set-up mutual funds. A
few of them are, Kothari pioneer MF, ICICI MF, Birla MF, Morgan Stanley MF, Tauras
MF, ect. As the number of mutual funds increased giving a choice to the competition in the
industry increased, thus jolting the hitherto complacent public sector mutual fund into
action. As a result, the investors not only had a wider choice regarding the kind of schemes
and the sponsor of the mutual fund, they started getting better service even from the old
players. These private sector funds provided an added advantage to the investors. These
were generally set-up in partnership with foreign mutual funds, with the letter providing
the technology and the experience in managing funds. The investors could thus derive the
consequent benefits by investing in these funds.

As the industry developed, the need was felt to regulate it. From the beginning, UTI was
governed by the provisions of the UTI Act 1963.Till 1987, as there were no other players
in the market, the need to come out with specific regulations for investment companies did
not arise. With the government allowing banks, financial institutions and insurance
companies to set-up mutual funds in 1987, a set of regulations was also needed. However,
till 1989, the only regulations in place were those which required banks to obtain RBI‟s
permission before setting up a mutual fund.

In 1989, RBI came out with comprehensive guidelines applicable to mutual funds
promoted by banks. Following this, the Central Government came out with guidelines
applicable to all mutual funds in June, 1990. The letter was to be administered by SEBI.
SEBI was initially established as an interim body under the Ministry of Finance in April,
1988 to regulate and develop the capital markets. It was later converted into a statutory
body under the SEBI Act, 1992 and given wide ranging powers. Mutual funds were one of
the players SEBI was authorized to regulate.

In August, 1990, SEBI ruled that the guidelines would only supplement those issued by the
Central Government. Hence the mutual funds sponsored by banks were required to fulfill
obligations under both sets of regulations. After allowing private sectors to enter the

15

industry, the Government came out with a fresh set of comprehensive guidelines for all the
players in February, 1992. These guidelines superseded the earlier guidelines of the
government and RBI. All mutual funds except money market mutual fund (those investing
exclusively in the money market) and offshore mutual funds were governed by these
guidelines. While the former were governed by guidelines issued by RBI, the latter were
governed by the Deportment of Economics Affairs under the Ministry of Finance.

Subsequently, SEBI issued even more detailed, comprehensive and stringent Mutual Funds
Regulations in 1993, which replaced the guidelines issued by the government in 1992.
These were further revised and replaced by Mutual Funds Regulations, 1996.

In October, 1999, the administration of Money Market Mutual Funds was handed over
by RBI to SEBI. With effect from March 7, 2000, RBI has withdrawn its guidelines on
Money Market Mutual Funds. Accordingly, such money market mutual fund schemes, like
any other mutual fund schemes, would exclusively be governed by the SEBI (Mutual
Fund) Regulations, 1996.

The fact that UTI, which is the biggest mutual fund in the country, does not fall under the
purview of SEBI, result in ineffective regulation by the latter. Besides, as compare the
performance of UTI‟s schemes with other mutual funds‟ schemes. To avoid this, SEBI
tried for a long time to bring UTI under its purview. However, UTI being a statutory body,
it was finally ruled that it cannot be regulated by another statutory body. As a result of
further efforts on both sides, finally an arrangement was arrived at between SEBI and UTI
whereby the latter agreed to voluntarily comply with SEBI‟ s regulations for certain
schemes.

The mutual fund industry grew tremendously during 1998 to 2000. the total net assets of
Rs. 97,228 crore managed by 34 mutual funds through their 259 schemes as on march
31,1998 increased to 1,02,434.52 crore managed by 39 mutual funds including UTI,
through their 550 schemes as on February 28,2001.

The year 2001 was a watershed year in the history of the Indian mutual funds industry. In
July, that year, UTI froze purchase and sale of units of its flagship scheme US-64 for a

period of six months, causing panic among many individual as well as large institutional
investors. Shelving its assured returns quality, US-64 became a market – return NAV
based mutual fund in January 2002. Its opening NAV was Rs. 5.81 against the face value
of Rs. 10.In January 2003, the Government of India bifurcate the UTI into UTI I and UTI
II. UTI I is now managed by a public administrator, while UTI II was handed over to the
State Bank of India, Panjab National Bank, Bank of Baroda and the Life Insurance
Corporation, with each institutions having an equal share in the company. It also came
under the ambit of regulation by SEBI. UTI II was renamed UTI mutual fund in February
2003. As on 31 March 2003, UTI AMC had under its management, 42 SEBI complaints
schemes and 4 offshore funds, aggregating to a corpus of more than Rs. 15,000crore from
about 10 million investor accounts.

As a August, 2004 the mutual fund industry had Rs.155, 845crore wroth of asset under its
management. Of this Rs.20, 256crore were those of UTI, Rs.1, 23,258.04 were those of the
private sector, and Rs.12, 171.20 were those of the other public sector. More than 75% of
the total assets under management were managed by the private sector mutual funds.

Major Mutual Fund Companies in India:

17

 Axis Asset Management Company

 AIG Global Investment Group Mutual Fund

 Birla Sun Life Mutual Fund

 Bank of Baroda Mutual fund

 DBS Chola Mutual Fund

 Fraanklin Templeton India Mutual Fund

 HDFC Mutual fund

 ICICI Prudential Mutual fund

 ING Mutual fund

 JM Financial Mutual fund

 JP Morgan Mutual fund

 Kotak Mahindra Mutual fund

 LIC Mutual fund

 Reliance Mutual fund

 Sahara Mutual fund

 State Bank of India Mutual fund

 Standard Charted Mutual fund

 Sundaram BNP Paribas Mutual fund

 Tata Mutual fund

 Unit Trust of India Mutusl fund

Association of Mutual Funds in India (AMFI)

With the increase in mutual fund players in India, a need for mutual fund association in
India was generated to function as a non-profit organisation. Association of Mutual Funds
in India (AMFI) was incorporated on 22nd August, 1995. AMFI is an apex body of all
Asset Management Companies (AMC) which has been registered with SEBI. Till date all
the AMCs are that have launched mutual fund schemes are its members. It functions under
the supervision and guidelines of its Board of Directors.

Association of Mutual Funds India has brought down the Indian Mutual Fund Industry to a
professional and healthy market with ethical lines enhancing and maintaining standards. It
follows the principle of both protecting and promoting the interests of mutual funds as well
as their unit holders.

The objectives of Association of Mutual Funds in India

The Association of Mutual Funds of India works with 30 registered AMCs of the country.
It has certain defined objectives which supports the guidelines of its Board of Directors.
The objectives are as follows:

This mutual fund association of India maintains high professional and ethical
standards in all areas of operation of the industry.

It also recommends and promotes the top class business practices and code of
conduct which is followed by members and related people engaged in the activities
of mutual fund and asset management. The agencies who are by any means
connected or involved in the field of capital markets and financial services also
involved in this code of conduct of the association.

AMFI interacts with SEBI and works according to SEBIs guidelines in the mutual
fund industry.

Association of Mutual Fund of India does represent the Government of India, the
Reserve Bank of India and other related bodies on matters relating to the Mutual
Fund Industry.

19

It develops a team of well qualified and trained Agent distributors. It implements a
programme of training and certification for all intermediaries and other engaged in
the mutual fund industry.

AMFI undertakes all India awareness programme for investor‟s in order to promote
proper understanding of the concept and working of mutual funds.

At last but not the least association of mutual fund of India also disseminate
information‟s on Mutual Fund Industry and undertakes studies and research either
directly or in association with other bodies.

STUCTURE OF THE INDIAN MUTUAL FUNDINDUSTRY:

Structure wise mutual fund industry can be classified into three categories;

Unit trust of India
The Indian mutual fund industry is dominated by the unit trust of India, which has a total corpus of 51000
crore collected from over 20 million investors. The UTI has many fund/ schemes in all categories in equity,
balanced, debt, money market etc. With some being open ended and some being closed ended. The unit
scheme 1964 commonly referred to as US64,which is a balanced fund, is the biggest scheme with a corpus
of about 10000 crore.
Public sector mutual fund
The second largest categories of mutual funds are the ones floated by nationalized banks .can bank asset
management floated by canara bank and sbi funds management floatedby state bank of india are the largest
of these. Gicamc floated by general insurancecorporation.

On line trading is a great idea to reduce management expenses from the current 2%of total assets to about
0.75%of the total asset.
72% of the crore-customer base of mutual fund in the top 50-broking firms in theus is expected to trade on
line by 2003

Private Sector Mutual fund

The third largest categories of mutual funds are the ones floated by the private sector domestic mutual funds and the
private sector foreign mutual funds. The largest of these in private sector domestic mutual funds are Reliance

mutual fund, JM capital management company ltd. Tata mutual, Axis mutual fund, Birla sun life asset management
pvt. Ltd. and in private foreign mutual funds these are alliance capital asset management private ltd, Franklin
Templeton Investments, Sun F&C asset management private ltd, Lurich asset management company pvt ltd. The
aggregate corpus of the assets managed by this category of amc‟s is about 42000 cr.

Future of Mutual Funds in India

Financial experts believe that the future of Mutual Funds in India will be very bright.
AUM of 41 mutual fund houses in India rose to Rs681,708crore at the end of March,
2011 and Rs.664,824 crore in 2012, according to AMFI data. In the coming 10 years
the annual composite growth rate is expected to go up by 13.4%. Since the last 5 years,
the growth rate was recorded as 9% annually. Based on the current rate of growth, it can
be forecasted that the mutual fund assets will be double by 2015.

GLOBAL SCENARIO OF MUTUAL FUND:

 The money market mutual fund segment has a total corpus of 1.48 trillion in theU.S.

 Out of the top 10 mutual fund worldwide, eight are worldwide sponsored. Only fidelity and capital
are non-bank mutual funds in this group.

 In the U.S. the total numbers of schemes is higher than that of the listed companies

 Internationally, mutual funds are allowed to go short. In India fund managers do nothave such
leeway.

 In the U.S. about 9.7 million households will manage their assets online by the year2003, such a
facility is not yet of avail in India and jeevanbimasahayogamc floated bythe LIC are some of the
other prominent ones. The aggregate corpus of the fundsmanaged by this category of amc‟s is
around 8300 cr.

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Chapter-2

Company profile

Axis Asset Management Company

Company Overview

Axis Asset management Company Limited is a privately owned investment manager. The
firm manages mutual funds for its clients. It invests in the public equity and fixed income
market of india. The firm also invest in gold for some of its funds. It is based in Mumbai,
India. Axis Asset Management Company Limited operates as a subsidiary of Axis Bank
Limited.

Name of the Mutual Fund Axis Mutual Fund
Date of set up of Mutual Fund September 4, 2009
Name of Sponsor Axis Bank Limited
Name of the Asset Management Axis Asset Management Company Limited
Company
Date of Incorporation of AMC January 13, 2009
Website www.axismf.com
Registrar and Transfer Agent KarvycomputersharePvt. Ltd.

Assets under management 8,815 (Rs.Cr)

Board of Directors
Axis Mutual Fund Trustee Limited:
Dr T C Nair, Chairman, Independent Director
Mr. B Gopalakrishnan, Associate Director
Mr.Kedar Desai, Independent Director
Mr.Uday M Chitale, Independent Director

Axis Asset Management Company Limited:
Mr. Rajiv Anand, MD & CEO of Axis AMC, Associate Director
Mr. R. K. Bammi, Associate Director
Ms.Shikha Sharma, Chairperson, Associate Director
23

Mr. T S Narayanasami, Independent Director
Mr.PraneshMisra, Independent Director
Mr. U R Bhat, Independent Director

OUR KEY BUSINESS PEOPLE

Mr.Chandresh Nigam, Head – Investments
Karan Datta, National Sales Head
Mr.PankajMurarka, Senior Fund Manager – Equity
R. Sivakumar, Head – Fixed Income & Products
Praveen Bhatt, Head – Operations
MitenChawda, Head – Compliance & Company Secretary
JineshGopani, Fund Manager – Equity
SudhanshuAsthana, Fund Manager – Equity
AshishNaik, Analyst – Equity
Viresh Joshi, Chief Trader – Equity
NinadDeshpande, Fund Manager – Fixed Income
Anurag Mittal, Credit Analyst – Fixed Income

SPONSOR OF AXIS AMC
Axis Bank Limited:

Axis Bank was the first of the new private banks to have begun operations in 1994, after
the Government of India allowed new private banks to be established. The Bank was

promoted jointly by the Administrator of the specified undertaking of the Unit Trust of
India (UTI - I), Life Insurance Corporation of India (LIC) and General Insurance
Corporation of India (GIC) and other four PSU insurance companies, i.e. National
Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance
Company Ltd. and United India Insurance Company Ltd.

The Bank as on 31st March, 2011 is capitalized to the extent of ` 410.54 crores with the
public holding (other than promoters and GDRs) at 53.60%.

The Bank's Registered Office is at Ahmedabad and its Central Office is located at Mumbai.
The Bank has a very wide network of more than 1281 branches (including 169 Service
Branches/CPCs as on 31st March, 2011). The Bank has a network of over 6270 ATMs (as
on 31st March, 2011) providing 24 hrs a day banking convenience to its customers. This is
one of the largest ATM networks in the country.

The Bank has strengths in both retail and corporate banking and is committed to adopting
the best industry practices internationally in order to achieve excellence.

VISION
To be the preffered financial solutions provider excelling in customer delivery through
insight, empowered employees and smart use of technology.

CORE VALUE
 Customer Centricity
 Ethics
 Transparency
 Teamwork
 Ownership
BUSINESS PHILOSOPHY

Our business will be built on three pillars. These are:

25

Outside-in View

Investor at the heart of every single decision.
Communicate in his language, not in ours.

Enduring Wealth Creation

Play a serious and credible role in investor's money basket.
Encourage investors to build a long-term perspective of the mutual fund category.

Long-term Relationships

Leverage the equity of the 'Axis' brand
Aim at building relationships rather than being transactional.

SWOT Analaysis of Axis AMC

STRENGTHS:

Professional investment management
Mutual funds hire full-time, high-level investment professionals. Funds can afford
to do so as they manage large pools of money. The managers have real-time access
to crucial market information and are able to execute trades on the largest and most
cost-effective scale.
Diversification
Mutual funds invest in a broad range of securities. This limits investment risk by
reducing the effect of a possible decline in the value of any one security..

Low Cost
A mutual fund let's you participate in a diversified portfolio for as little as
Rs.5,000/-, and sometimes less. And with a no-load fund, you pay little or no sales
charges to own them.

Convenience and Flexibility
You own just one security rather than many, yet enjoy the benefits of a diversified
portfolio and a wide range of services.

Personal Service
One call puts you in touch with a specialist who can provide you with information
you can use to make your own investment choices.

Liquidity
In open-ended schemes, you can get your money back promptly at net asset value
related prices from the mutual fund itself.

Transparency
You get regular information on the value of your investment in addition to
disclosure on the specific investments

WEAKNESS
Risk is defined as short-term price variability. But on a long-term basis, risk is the
possibility that your accumulated real capital will be insufficient to meet your financial

27

goals. And if you want to reach your financial goals, you must start with an honest
appraisal of your own personal comfort zone with regard to risk.
Individual tolerance for risk varies, creating a distinct "investment personality" for each
investor. Some investors can accept short-term volatility with ease, others with near panic.
So whether you consider your investment temperament to be conservative, moderate or
aggressive, you need to focus on how comfortable or uncomfortable you will be as the
value of your investment moves up or down.

OPPORTUNITIES
As per the BLOOM BERG survey India's total disposable income will increase to 40% by
2015,along with total income of an average Indian family will be 450000.
As people are getting aware of the fact of investment and want to invest more with
specialized assistant mutual funds have a great opportunities.
As the risk is diversified and funds are available as per the different objective people can
invest as per their requirement.
Maximum money is invested in equity market and as the GDP is growing studily this is a
great opportunity for the companies to go ahead and invest more in to the market.

THREATS
A new competitor in your home market
Price wars with competitors
Competitor has new innovative product or service
Taxation

Schemes of Axis Mutual Fund

 Equity Funds:

Axis Equity Fund
Axis Long Term Equity Fund
Axis Midcap Fund
Axis Focused 25 Fund

 Fixed Income Funds:
Axis Liquid Fund
Axis Treasury Advantage Fund
Axis Short Term Fund
Axis Dynamic Bond Fund

 Hybrid Funds:
Axis Triple Advantage Fund
Axis Income Saver

 Gold Funds:
Axis Gold Fund
Axis Gold ETF

Axis Equity Fund:

An Open-ended Growth Scheme

29

To achieve long term capital appreciation by investing in a diversified portfolio
predominantly consisting of equity and equity related securities including derivatives.
However, there can be no assurance that the investment objective of the scheme will be
achieved.

Key Features

A diversified equity fund that invests primarily in the Indian equity markets
Provides the opportunity to capitalize on India's high paced growth
Supported by a strong investment management team at Axis Mutual Fund
Suitable for an investment horizon of 5 years or more
With no entry load
EasyCall facility available

Axis Long Term Equity Fund:

An Open-ended Equity-Linked Saving Scheme with a 3 year lock in.

To generate income and long term capital appreciation from a diversified portfolio of
predominantly equity and equity related securities.

Key Features

A diversified equity fund that invests in the Indian equity markets
Provides the opportunity to capitalize on India‟s high paced growth
Also provides tax benefits under section 80C of the Income Tax Act, 1961
Lock-in period of only 3 years is the lowest amongst all section 80C options
available today
With no entry load
Flexibility to invest across market caps in high growth stocks

Axis Midcap Fund:

An Open-ended Equity Scheme

To achieve long term capital appreciation by investing predominantly in equity and equity
related instruments of mid size companies. The focus of the fund would be to invest in
relatively larger companies within this category.

Key Featurs

An equity fund that invests primarily in mid sized companies to capitalise on their
fast paced growth
Amongst the mid sized companies, it has a preference for the larger ones that carry
relatively lower risk
It is suitable for an investment horizon of 5 yrs or more
It is suitable when you want to plan for a bigger home, better holidays, bigger cars,
etc.

Axis Focused 25 Fund:
An Open-ended Equity Scheme
Axis Focused 25 Fund - a fund that attempts to unearth and invests exclusively in just these
quality companies. The reassurance of quality companies who have not just weathered
storms over time but prospered and bloomed even in adverse times.
Key Features

Focus in the best ideas at any point of time
Nurtures companies over their business cycle without being affected by short term
market volatility
Professional fund management with established track record
With no entry load

Axis Liquid Fund:

An open-ended Liquid Scheme

To provide a high level of liquidity with reasonable returns commensurating with low risk
through a portfolio of money market and debt securities.

Key Features
31

An extremely low risk fund suitable for an investment horizon of 1 day – 90 days
Returns are calculated for the number of days you remain invested
No entry or exit loads
High liquidity - Under normal circumstances, we will endeavour to ensure that an
investor gets his money back one day after putting in a valid redemption request

Axis Treasury Advantage Fund:

An open-ended Debt scheme

To provide optimal returns and liquidity to the investors by investing primarily in a mix of
money market and short term debt instruments which results in a portfolio having
marginaly higher maturity as compared to a liquid fund at the same time maintaining a
balance between safety and liquidity.

Key Features

A low risk fund suitable for an investment horizon of 1 day to 90 days
No entry or exit loads
Tax efficient as dividends are tax-free in your hands (post deduction of 14.1625%
dividend distribution tax for individual investors - inclusive of cess and surcharge)

Axis Short Term Fund:

An Open-ended Debt Scheme

To Generate stable returns with a low risk strategy while maintaining liquidity through a
portfolio comprising of debt and money market instruments.

Key Features

A low risk fund suitable for an investment horizon of 6 months or more
Aims to provide stable returns by investing in debt and money market instruments

Tax efficient as dividends are tax-free in your hands (post deduction of 14.1625%
dividend distribution tax for individual investors - inclusive of cess and surcharge)

Axis Dynamic Bond Fund:

An Open-ended Debt Scheme

To generate optimal returns while maintaining liquidity through active management of a
portfolio of debt and money market instruments.

Key Features

A low risk fund suitable for an investment horizon of 1 year or more
Dynamic asset allocation policy across fixed income assets
Seeks to exploit market opportunities & manage risk
Able to invest across all segments of fixed income
Flexibility to invest only in high conviction ideas
Does not track benchmarks, i.e. can be invested in money market during rising rate
environment

Axis Triple Advantage Fund:

An Open-ended Hybrid Fund

To generate long term capital appreciation by investing in adiversified portfolio of equity
and equity related instruments, fixed income instruments and gold exchange traded funds.

Key Features

Provides diversification across three asset classes viz. equity, fixed income and
gold thereby leading to reduction in risk

33

Returns potential not compromised even with reduced risk levels
Returns more stable than pure equity or gold investments over the long term
Offers convenience. Now one single application is sufficient for investment in three
asset classes.
20 - 30% of investment in gold. Gold is a good hedge against financial crises.

Axis Income Saver:

An Open-ended Income Fund

To generate regular income through investments in debt and money market instruments,
along with capital appreciation through limited exposure to equity and equity related
instruments. It also aims to manage risk through active asset allocation.

Key Features

A low to medium risk fund suitable for an investment horizon of 2 – 4 years
Brings stability to your portfolio by investing primarily in fixed income instruments
Offers the potential for capital growth through limited exposure to equity
instruments
Adopts a quantitative asset allocation strategy for risk management
Open-ended nature allows you to buy or sell units of the scheme at any point of
time subject to applicable loads
Scheme managed by an experienced team of fund managers

Axis Gold Fund:

Key Features

Systematically invest in gold each month through SIPs
Buy gold in amounts as small as Rs 1000 without having to worry about purity
No demat account required
Buy/sell units of Axis Gold Fund on any business day at NAV based prices
No storage charges , no making charges, no safe-keeping worries

Axis Gold ETF:

Axis Gold ETF offers a simple way of investing in gold. It is a mutual fund scheme that
lets you buy gold without the necessity of taking physical delivery or of the associated
risks of physical storage or of impurities.

Key Features

Protects against inflation
Allows you to take advantage of Gold as an investment opportunity
Investors bear no risk of storage and safekeeping of gold
Get 99.5% purity at prevailing market prices without premium charges

35

Chapter-3

Objective

OBJECTIVES OF THE STUDY

1. To find out the physiology of investors in India towards investment in mutual
funds.
2. To know the Preferences for the portfolios.
3. To know why one has invested or not invested in Axis Mutual fund
4. To find out the most preferred channel.
5. To find out what should do to boost Mutual Fund Industry.
6. It is to understand the concept of mutual funds as well as to know the scope of
various schemes.
7. To Study and analyze the Economic impacts of growth of the Mutual Funds
industry in India.
8. The main objective of this project is concerned with getting the opinion of
people regarding mutual funds and what they feel about availing the services of
financial advisors.
9. I have tried to explore the general opinion about mutual funds. It also covers
why/ why not investors are availing the services of financial advisors.

37

CHANNEL MANAGEMENT OF THE AXIS
ASSET MANAGEMENT COMPANY

AXIS AMC

BUSINESS CORPORATION

INSTITUTIONAL RETAIL COMPANY PARTNERSHIP HUF

BANKS

IFA’s

1. BUSINESS
Under the category of business there are two sub-divisions.
1.1 INSTITUTIONAL
National distributors come under it. They are more viable in nature. Have more
business generating capacity.
1.2 RETAIL
Under the category of retail mainly Banks and IFA‟s have major role.

1.2.1 BANKS
There banks acts as a mediator between investors and asset management companies
through that they help in promoting various schemes. On the basis of their business
generating capability they got commission.
1.2.2 IFA’s
Individual financial agencies are the distributors who work for selling mutual funds
directly to the investors.

39

2. CORPORATION

2.1 COMPANY

2.2 PARTENRSHIP
It is a relationship between persons who have agreed to share the profits of a
business.

2.3 HINDU UNDIVIDED FAMILY

UNDER CHANNEL MANAGEMENT OF AXIS AMC

1. Empannelise Distributors (IFA‟s) From Jaipur (Rajasthan) first of all I started with
empanelling or adding new distributors from Jaipur according to their AUM in other
AMC‟s. My mentor helped me in collecting this data. I have to prepare database related to
it, where I synchronised the data of those distributors according to highest AUM. After
getting the data I was supposed to do cold calls to all those distributors and convince them
to do business with Axis AMC.

2. Retail Business While doing the work of empanelment, I have also started concentrating
on existing IFA‟s. I gave presentations in front of many of them and even they appreciated
my work. The main focus was on SIP as there was an incentive based proposition came for
IFA‟s till the limited period.

Under Banking channel I mate with relationship managers and convinced them regarding
the schemes and I was in regular contact with them in case of any query.

Chapter-5

Research
Methodology

41

RESEARCH METHODOLOGY

This report is based on primary as well secondary data, however primary data
collection was given more importance since it is overhearing factor in attitude
studies. One of the most important users of research methodology is that it helps in
identifying the problem, collecting, analyzing the required information data and
providing an alternative solution to the problem. It also helps in collecting the vital
information that is required by the top management to assist them for the better
decision making both day to day decision and critical ones.

Data sources:

Research is totally based on primary data. Secondary data can be used only for the
reference. Research has been done by primary data collection, and primary data has
been collected by interacting with various people. The secondary data has been
collected through various journals and websites.

Duration of Study:

The study was carried out for a period of two months, from 2nd May to 1st July 2012.

Sampling:

Sampling procedure:

The sample was selected of them who are the customers/visitors of Axis Bank,
Malviya Nagar and Vaishali Nagar Branch, irrespective of them being investors or
not or availing the services or not. It was also collected through personal visits to
persons, by formal and informal talks and through filling up the questionnaire
prepared. The data has been analyzed by using mathematical/Statistical tool.

Sample size:

The sample size of my project is limited to 200 people only. Out of which only 120
people had invested in Mutual Fund. Other 80 people did not have invested in
Mutual Fund.

Sample design:

Data has been presented with the help of bar graph, pie charts, line graphs etc.

Limitations of the study

The following are the major limitations of the study.
The sample was restricted to specified region only.
The sample collected may not represent the entire population and the result may not
be a true representation of total universe.

43

Chapter-6

Data Presentation
and Analysis

ANALYSIS & INTERPRETATION OF THE DATA

1. a) Age distribution of the Investors

Age Group <= 30 31-35 36-40 41-45 46-50 >50

No. of 12 18 30 24 20 16
Investors
Investors invested in Mutual Fund

35

30

25

20

15 30
24
10 18 20
16
5 12

0
<=30 31-35 36-40 41-45 46-50 >50
Age group of the Investors

Interpretation:
According to this chart out of 120 Mutual Fund investors of Jaipur the most
are in the age group of 36-40 yrs. i.e. 25%, the second most investors are in
the age group of 41-45yrs i.e. 20% and the least investors are in the age
group of below 30 yrs.

45

b). Educational Qualification of investors:

Educational Qualification Number of Investors

Graduate/ Post Graduate 88

Under Graduate 25

Others 7

Total 120

6%

23%

71%

Graduate/Post Graduate Under Graduate Others

Interpretation:

Out of 120 Mutual Fund investors 71% of the investors are Graduate/Post
Graduate, 23% are Under Graduate and 6% are others (under HSC).

c). Occupation of the investors:

Occupation No. of Investors
Govt. Service 30
.
Pvt. Service 45
Business 35
Agriculture 4
Others 6

50
45
No. of Investors

40
35
30
25
45
20
35
15 30
10
5 6
0 4
Govt. Service Pvt. Service Business Agriculture Others

Occupation of the customers

Interpretation:

In Occupation group out of 120 investors, 38% are Pvt. Employees,
25% are Businessman, 29% are Govt. Employees, 3% are in
Agriculture and 5% are in others.

d). Monthly Family Income of the Investors:

47

Income Group No. of Investors
<=10,000 5
10,001-15,000 12
15,001-20,000 28
20,001-30,000 43
>30,000 32

50
45
40
No. of Investors

35
30
25
20 43
15 32
28
10
5 12
5
0
<=10 10-15 15-20 20-30 >30
Income Group of the Investorsn (Rs. in Th.)

Interpretation:

In the Income Group of the investors, out of 120 investors, 36%
investors that is the maximum investors are in the monthly income
group Rs. 20,001 to Rs. 30,000, Second one i.e. 27% investors are
in the monthly income group of more than Rs. 30,000 and the
minimum investors i.e. 4% are in the monthly income group of
below Rs. 10,000

e). Percentage (%) of Annual Savings:

0

9.17
15.83

Less then
10%
10-20%
35
21-30%

31-40%
40

Less than 0% 10-20% 21-30% 31-40%
19 48 42 11

Interpretation
Everybody saves some proportion of the income looking at the present and future needs.
The pie chart shows that major proportion that is 40 % investors have annual savings
ranging from 10 -20% whereas 35% investors annual saving ranges from 21-30%.

f). Risk-Taking Ability Of Investors:

49

High-Risk

Reluctant

Low risk

Careful

0 10 20 30 40 50

Careful Low risk Reluctant to risk High risk
33 49 24 14

Interpretation
There are very few investors who believe in avoiding risk while investing in different
avenues. The major proportion is those of low risk taker here the investors invest their
wealth mainly in mutual funds, fixed deposits etc.

(2) Investors invested in different kind of investments:

Kind of Investments No. of Respondents
Saving A/C 195
Fixed deposits 148
Insurance 152
Mutual Fund 120
Post office (NSC) 75
Shares/Debentures 50
Gold/Silver 30
Real Estate 65

65
Kinds of Investment

30
50
75
120
152
148
195

0 100 200 300

No.of Respondents

Interpretation:

From the above graph it can be inferred that out of 200 people, 97.5% people have
invested in Saving A/c, 76% in Insurance, 74% in Fixed Deposits, 60% in Mutual
Fund, 37.5% in Post Office, 25% in Shares or Debentures, 15% in Gold/Silver and
32.5% in Real Estate.

3. Preference of factors while investing:

51

Factors (a) Liquidity (b) Low (c) High Return (d) Trust
Risk

No. of 40 60 64 36
Respondents

18% 20%

32% 30%

Liquidity Low Risk High Return Trust

Interpretation:

Out of 200 People, 32% People prefer to invest where there is High Return,
30% prefer to invest where there is Low Risk, 20% prefer easy Liquidity
and 18% prefer Trust

4. Awareness about Mutual Fund and its Operations:

Response Yes No

No. of Respondents 135 65

33%

67%

Yes No

Interpretation:

From the above chart it is inferred that 67% People are aware of Mutual
Fund and its operations and 33% are not aware of Mutual Fund and its
operations.

5. Source of information for customers about Mutual Fund:

53

Source of information No. of Respondents
Advertisement 18
Peer Group 25
Bank 30
Financial Advisors 62

80

60
No. of Respondents

40
62
20
25 30
18
0
Advertisement Peer Group Bank Financial Advisors

Source of Information

Interpretation:

From the above chart it can be inferred that the Financial Advisor is the
most important source of information about Mutual Fund. Out of 135
Respondents, 46% know about Mutual fund Through Financial Advisor,
22% through Bank, 19% through Peer Group and 13% through
Advertisement.

6. Investors invested in Mutual Fund:

Response No. of Respondents
YES 120
NO 80
Total 200

No
40%

Yes
60%

Interpretation:

Out of 200 People, 60% have invested in Mutual Fund and 40% do not have
invested in Mutual Fund.

7.Reason for not invested in Mutual Fund:

55

Reason No. of Respondents

Not Aware 65
Higher Risk 5
Not any Specific Reason 10

13% 6%

81%

Not Aware Higher Risk Not Any

Interpretation:

Out of 80 people, who have not invested in Mutual Fund, 81% are not aware
of Mutual Fund, 13% said there is likely to be higher risk and 6% do not
have any specific reason.

8. Investors invested in different Assets Management Co. (AMC):

Name of AMC No. of Investors
AxisMF 55
UTI 75
HDFC 30
Reliance 75
ICICI Prudential 56
Kotak 45
Others 70

Others
70
HDFC
30
Name of AMC

Kotak
45
AxisMF
55
ICICI
56
Reliance
75
UTI
75
0 20 40 60 80
No. of Investors

Interpretation:

Most of the Investors preferred UTI and Reliance Mutual Fund. Out of 120
Investors 62.5% have invested in each of them, only 46% have invested in
AxisMF, 47% in ICICI Prudential, 37.5% in Kotak and 25% in HDFC.

9. Reason for invested in AxisMF:

57

Associated with Axis 35
Better Return 5
Agents Advice 15

27%

9% 64%

Associated with AXIS Better Return Agents Advice

Interpretation:

Out of 55 investors of AxisMF 64% have invested because of its association
with Brand AXIS, 27% invested on Agent‟s Advice, 9% invested because
of better return.

10. Reason for not invested in AxisMF

Not Aware 25
Less Return 18
Agent‟s Advice 22

34% 38%

28%

Not Aware Less Return Agent's Advice

Interpretation:

Out of 65 people who have not invested in AxisMF, 38% were not aware
with AxisMF, 28% do not have invested due to less return and 34% due to
Agent‟s Advice.

11. Preference of Investors for future investment in Mutual Fund

59

Name of AMC No. of Investors
AxisMF 76
UTI 45
HDFC 35
Reliance 82
ICICI Prudential 80
Kotak 60
Others 75

Others 75

Kotak 60
Name of AMC

ICICI Prudential 80

Reliance 82

HDFC 35

UTI 45

AxisMF 76

0 20 40 60 80 100

No. of Investors

Interpretation:

Out of 120 investors, 68% prefer to invest in Reliance, 67% in ICICI
Prudential, 63% in AxisMF, 62.5% in Others, 50% in Kotak, 37.5% in UTI
and 29% in HDFC Mutual Fund.

12. Channel Preferred by the Investors for Mutual Fund Investment

Channel Financial Advisor Bank AMC
No. of 72 18 30
Respondents

25%

15% 60%

Financial Advisor Bank AMC

Interpretation:

Out of 120 Investors 60% preferred to invest through Financial Advisors,
25% through AMC and 15% through Bank.

13. Mode of Investment Preferred by the Investors
61

Mode of Investment One time Investment Systematic Investment Plan
(SIP)
No. of Respondents 78 42

35%

65%

One time Investment SIP

Interpretation:

Out of 120 Investors 65% preferred One time Investment and 35 %
Preferred through Systematic Investment Plan.

14. Preferred Portfolios by the Investors

Portfolio No. of Investors
Equity 56
Debt 20
Balanced 44

37% 46%

17%

Equity Debt Balance

Interpretation:

From the above graph 46% preferred Equity Portfolio, 37% preferred
Balance and 17% preferred Debt portfolio

15. Option for getting Return Preferred by the Investors

63

Option Dividend Payout Dividend Growth
Reinvestment
No. of Respondents 25 10 85

21%
8%
71%

Dividend Payout Dividend Reinvestment Growth

Interpretation:

From the above graph 71% preferred Growth Option, 21% preferred
Dividend Payout and 8% preferred Dividend Reinvestment Option..

Chapter-7

Suggestions and
Recommendations

65

Suggestions and Recommendations

 The most vital problem spotted is of ignorance. Investors should be
made aware of the benefits. Nobody will invest until and unless he
is fully convinced. Investors should be made to realize that
ignorance is no longer bliss and what they are losing by not
investing.
 Mutual funds offer a lot of benefit which no other single option
could offer. But most of the people are not even aware of what
actually a mutual fund is? They only see it as just another
investment option. So the advisors should try to change their
mindsets. The advisors should target for more and more young
investors. Young investors as well as persons at the height of their
career would like to go for advisors due to lack of expertise and
time.
 Mutual Fund Company needs to give the training of the Individual
Financial Advisors about the Fund/Scheme and its objective,
because they are the main source to influence the investors.
 Before making any investment Financial Advisors should first
enquire about the risk tolerance of the investors/customers, their
need and time (how long they want to invest). By considering these
three things they can take the customers into consideration.
 Younger people aged under 35 will be a key new customer group
into the future, so making greater efforts with younger customers
who show some interest in investing should pay off.
 Customers with graduate level education are easier to sell to and
there is a large untapped market there. To succeed however,
advisors must provide sound advice and high quality.

Systematic Investment Plan (SIP) is one the innovative products launched by Assets
Management companies very recently in the industry. SIP is easy for monthly salaried
person as it provides the facility of do the investment in EMI. Though most of the
prospects and potential investors are not aware about the SIP. There is a large scope for the
companies to tap the salaried persons.

67

Chapter-8

Limitations and
scope

Limitation:

Some of the persons were not so responsive.
Possibility of error in data collection because many of investors may have not
given actual answers of my questionnaire.
Sample size is limited to 200 visitors of Axis Bank ,Malviya Nagar and
Vaishali Nagar out of these only 120 had invested in Mutual Fund. The
sample size may not adequately represent the whole market.
Some respondents were reluctant to divulge personal information which can
affect the validity of all responses.
The research is confined to a certain part of Jaipur.

69

Scope of the study

A big boom has been witnessed in Mutual Fund Industry in resent times. A large
number of new players have entered the market and trying to gain market share in
this rapidly improving market.

The research was carried on in Jaipur. I had been sent at one of the branch Axis bank
where I completed my Project work. I surveyed on my Project Topic “Channel
Management of Axis Mutual Fund and Analysing Preferences of The Investors For
Investment In Mutual Funds” on the visiting customers of the AxisMalviya Nagar
and Vaishali Nagar Branch.

The study will help to know the preferences of the customers, which company,
portfolio, mode of investment, option for getting return and so on they prefer. This
project report may help the company to make further planning and strategy.

Chapter-9

Conclusion

71

Findings

 The Age Group of 36-40 years were more in numbers. The second
most Investors were in the age group of 41-45 years and the least were
in the age group of below 30 years.
 Most of the Investors were Graduate or Post Graduate and below HSC
there were very few in numbers.
 In Occupation group most of the Investors were Govt. employees, the
second most Investors were Private employees and the least were
associated with Agriculture.
 In family Income group, between Rs. 20,001- 30,000 were more in
numbers, the second most were in the Income group of more than
Rs.30,000 and the least were in the group of below Rs. 10,000.
 About all the Respondents had a Saving A/c in Bank, 76% Invested in
Fixed Deposits, Only 60% Respondents invested in Mutual fund.
 Mostly Respondents preferred High Return while investment, the
second most preferred Low Risk then liquidity and the least preferred
Trust.
 Only 67% Respondents were aware about Mutual fund and its
operations and 33% were not.
 Among 200 Respondents only 60% had invested in Mutual Fund and
40% did not have invested in Mutual fund.
 Out of 80 Respondents 81% were not aware of Mutual Fund, 13%
told there is not any specific reason for not invested in Mutual Fund
and 6% told there is likely to be higher risk in Mutual Fund.
 Most of the Investors had invested in Reliance or UTI Mutual Fund,
ICICI Prudential has also good Brand Position among investors,
AxisMF places after ICICI Prudential according to the Respondents.
 Out of 55 investors of Axis MF 64% have invested due to its
association with the Brand Axis, 27% Invested because of Advisor‟s
Advice and 9% due to better return.

 Most of the investors who did not invested in Axis MF due to not
Aware of Axis MF, the second most due to Agent‟s advice and rest
due to Less Return.
 For Future investment the maximum Respondents preferred Reliance
Mutual Fund, the second most preferred ICICI Prudential, Axis MF
has been preferred after them.
 60% Investors preferred to Invest through Financial Advisors, 25%
through AMC (means Direct Investment) and 15% through Bank.
 65% preferred One Time Investment and 35% preferred SIP out of
both type of Mode of Investment.
 The most preferred Portfolio was Equity, the second most was
Balance (mixture of both equity and debt), and the least preferred
Portfolio was Debt portfolio.
 Maximum Number of Investors Preferred Growth Option for returns,
the second most preferred Dividend Payout and then Dividend
Reinvestment.

73

Conclusion

Running a successful Mutual Fund requires complete understanding of the
peculiarities of the Indian Stock Market and also the psyche of the small investors.
This study has made an attempt to understand the financial behavior of Mutual Fund
investors in connection with the preferences of Brand (AMC), Products, Channels
etc. I observed that many of people have fear of Mutual Fund. They think their
money will not be secure in Mutual Fund. They need the knowledge of Mutual Fund
and its related terms. Many of people do not have invested in mutual fund due to lack
of awareness although they have money to invest. As the awareness and income is
growing the number of mutual fund investors are also growing.

“Brand” plays important role for the investment. People invest in those Companies
where they have faith or they are well known with them. There are many AMCs in
Jaipur but only some are performing well due to Brand awareness. Some AMCs are
not performing well although some of the schemes of them are giving good return
because of not awareness about Brand. Reliance, UTI,AxisMF, ICICI Prudential etc.
They are well known Brand, they are performing well and their Assets Under
Management is larger than others whose Brand name are not well known like
Principle, Sunderam, etc.

Distribution channels are also important for the investment in mutual fund. Financial
Advisors are the most preferred channel for the investment in mutual fund. They can
change investors‟ mind from one investment option to others. Many of investors
directly invest their money through AMC because they do not have to pay entry load.
Only those people invest directly who know well about mutual fund and its
operations and those have time.

Chapter-10

Annexure

75

QUESTIONNAIRE

1. Personal details:

(a). Name:-

(b). City: - contact no:-

(c). Age:-

(d). Qualification:-

Graduation/pg Under graduate Others

(e). Occupation. Pl tick (√)

Govt. Ser Pvt.Ser Business Agriculture Others

(f). What is your monthly family income approximately? Pl tick (√).

Up to Rs. 10,001 to Rs. 15,001 to Rs. 20,001 to Rs. 30,001
rs.10,000 15000 20,000 30,000 and above

(g). What much do you think you will be able to save on an annual basis as a % of your
total annual income?

Less than 10% 10-20% 20-30% More than 30%

(h). How would you honestly describe yourself as a risk-taker?
Careful Low risk taking capability

Extremely reluctant to risk High risk taking capability

2. What kind of investments you have made so far? Pl tick (√). All applicable.

A. Saving account B. Fixed deposits C. Insurance D. Mutual fund
E. Post office-nsc, etc F. G. Gold/ silver H. Real estate
Shares/debentures

3. While investing your money, which factor will you prefer?
.
(a) liquidity (b) low risk (c) high return (d) trust

4. Are you aware about mutual funds and their operations? Pl tick (√).
a) yes b) no

5. If yes, how did you know about mutual fund?

A. Advertisement B. Peer group C. Banks D. Financial advisors

6. Have you ever invested in mutual fund? Pl tick (√).
a) yes b) no

77

7. If not invested in mutual fund then why?

(a) not aware of mf (b) higher risk (c) not any specific reason

8. If yes, in which mutual fund you have invested? Pl. Tick (√).All applicable.

A. B. UTI C. D. E. Kotak F. Other specify
AxisMF HDFC Reliance

9. If invested in axis mf, you do so because (pl. Tick (√), all applicable).

A. Axismf is associated with axis bank
B. They have a record of giving good returns year after year.
C. Agent‟ advice

10. If not invested in axis mf, you do so because (pl. Tick (√) all applicable).

A. You are not aware of axis mf.
B. Axis mf gives less return compared to the others.
C. Agent‟ advice

11. When you plan to invest your money in asset managementco. Which AMC will you
prefer?

Assets management co.
A. Axis mf

B. Uti
C. Reliance
D. Hdfc
E. Kotak
F. Icici

12. Which channel will you prefer while investing in mutual fund?

(a) financial advisor (b) bank (c) AMC

13. When you invest in mutual funds which mode of investment will you prefer? Pl. Tick
(√).

A. One time investment B. Systematic investment plan (sip)

14. When you want to invest which type of funds would you choose?

A. Having only debt B. Having debt & equity C. Only equity portfolio.
portfolio portfolio.

15. How would you like to receive the returns every year? Pl. Tick (√).

A. Dividend payout B. Dividend re- C. Growth in nav
investment

79

BIBLIOGRAPHY

i. News papers

ii. Outlook money

iii. Television channel (cnbcaawaj)

iv. Mutual fund hand book

v. Fact sheet and statement

vi. www.axismf.com

vii. www.moneycontrol.com

viii. www.amfiindia.com

ix. www.onlineresearchonline.com

x. www. mutualfundsindia.com

Project report of axis mutual fund by kamal

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