A Project Report On:

Need of financial advisors for

mutual fund investors

(With special reference to KARVY)

Interim report SUBMITTED BY:

Leena sharma
Roll no. -

Under the guidance of:

Mr. Rohit vyas

Product head( MF), Eastern region,
prof. p. mahapatra
faculty,ASBM,Bhubaneswar
KARVY, Kolkata
 DECLARATION

I, Ms.leena sharma do hereby declare that the project report titled“NEED OF

FINANCIAL ADVISORS FOR MUTUAL FUND INVETORS” is a genuine
research work undertaken by me and it has not been published anywhere earlier.

Date:
Place:

Leena sharma
MDU(IMSAR)
 PREFACE

The successful completion of this project was a unique experience for me

because by visiting many place and interacting various person, I achieved
a better knowledge about sales. The experience which I gained by doing
this project was essential at this turning point of my career this project is
being submitted which content detailed analysis of the research under
taken by me.
The research provides an opportunity to the student to devote his/her skills
knowledge and competencies required during the technical session.
The research is on the topic “Share Khan Demat
Account”.
 Acknowledgement
It was a great opportunity for us to work with karvy stock broking Ltd., We
are extremely grateful to all those who have shared their expertise and
knowledge with me and without whom the completion of this project would
have been virtually impossible.
Firstly, we would like to thank our Company Guide Mr. krishan ……… who
has been a constant source of inspiration for us during the completion of
this project. He gave us invaluable inputs during our endeavor to complete
this project.
We are indebted to all staff of Sharekhan Ltd for their valuable support and
cooperation during the entire tenure of this project. Not to forget, all those
who have kept our spirits surging and helped delivering our best.
We thank our faculty guide Mrs. Poonam Purohit who helped us out at
every critical situation that We faced in our project and gave us her
valuable advice to solve problems.
We want to give our special thanks to all members of BIMS, for providing us
opportunity to work on this project with this great organization.
At last We would like to thank all the respondents met in the preparation,
who gave their valuable time to provide us required information and their
honest support to complete our project in time.
Leena Sharma
REG. NO: -
TABLE OF CONTENTS FOR PROJECT REPORT

Serial TOPIC Page

no No
 Executive summary

This project has been a great learning experience for me , at the

same time it gave me enough scope to implement my analytical
ability. This project as a whole can be divided into two parts :

 The ist part gives an insight about the mutual fund and its
various aspects. It is purely based on whatever I learned at
karvy.One can have a brief knowledge about mutual fund and
all its basics through this project. Other than that the real
service come when one moves ahead . some of the most
interesting question regarding mutual fund have been covered.
Some of them are :…………………………………………………………….All
the topics have been covered in a very systematic way . all the
dats have been well analyzed with the help of charts and
graphs .

 Second part consists of data and their analysis collected

through a survey done on 50 people . it coveres the topic “
need of financial advisors for mutual fund investors “ . the data
collected has been well organized and presented . hope the
research findings and conclusions will be of use . it has also
covered why people don’t want to go for financial advisors .the
advisors can take further steps to approach more and more
people an dindulge them for taking their advice .
 INTRODUCTION

COMPANY PROFILE

Introduction:
“Success is a journey, not a destination.” If we look for
examples to prove this quote then we can find many but there is none like that of karvy. Back in
the year 1981, five people created history by establishing karvy and company which is today
known as karvy, the largest financial service provider of India.

Success sutras of karvy:

The success story of karvy is driven by 8 success sutras adopted by it namely trust,
integrity, dedication, commitment, enterprise, hard
work and team play, learning and innovation,
empathy and humility. These are the values that bind success with karvy.
Vision of karvy:
To achieve & sustain market leadership, Karvy shall aim for complete customer satisfaction, by
combining its human and technological resources, to provide world class quality services. In the
process Karvy shall strive to meet and exceed customer's satisfaction and set industry standards.

Mission statement:

“Our mission is to be a leading and preferred serviceprovider to our customers, and we

aim to achievethis leadership position by building an innovative,
enterprising , and technology driven organizationwhich will set the highest standards of
service andbusiness ethics”.

Karvy Values:

Integrity
Responsibility
Reliability
Unity
Understanding
Excellence
Confidentiality

Karvy has adequate internal control systems and procedures

commensurate with the size nature of its business. These system
and procedures provide reasonable assurance of maintenance of
proper accounting records, reliability of financial information,
protection of resources and safeguarding of assets against
unauthorized use.

Company overview:

Karvy was established as karvy and company by five chartered accountants during the
year 1979-80, and then its work was confined to audit and taxation only. Later on it
diversified into financial and accounting services during the year 1981-82 with a capital
of rs.150000. it achieved its first milestone after its first investment in technology. Karvy
became a known name during the year 1985-86 when it forayed into capital market as
registrar.

Evolution of KARVY:
It is well said that success is a journey not a destination and we can see it being proved
by karvy. Under this section we will see that how this “karvy and company” of 1980
became “karvy” of 2008. Karvy blossomed with the setting up of its first branch at
Mumbai during the year 1987-88. The turning point came in the year 1989 when it
decided to enter into one of the not only emerging rather potential field too i.e; stock
broking. It added the feather of stock broking into its cap. At the same time it became
the member of Hyderabad Stock Exchange through associate firm karvy securities ltd
and then karvy never looked back……..it went on adding services one after another, it
entered into retail stock broking in the year 1990. Karvy investor service centers were
set up in the year 1992. Karvy which already enjoyed a wide network through its
investor service centers, entered into financial product distribution services in the year
1993. One year more and karvy was now dealing into mutual fund services too in the
year 1994 but it didn’t stopped there, it stepped into corporate finance and investment
banking in the year 1995.
Karvy’s strategy has always been being the first entrant in the market. Karvy again hit
the limelight by becoming the first registrar in the country to be awarded ISO 9002 in
the year 1997. Then it stepped into the other most happening sector i.e; IT enabled
services by establishing its own BPO units and at a gap of just 1 year it took the path of
e-Business through its website www.karvy.com . Then it entered into insurance services
in the year 2001 with the launch of its retail arm “karvy- the finapolis: your personal
finance advisor”. Then in the year 2002 it launched its PCG(Private Client Group) which
looks after its High Networth Individuals .and maintain their portfolio and provides
them with other financial services. In the year 2003, it commenced secondary debt and
WDM trading.
It was a decade which saw many Indian companies going global…..so why the largest
financial service provider of India should lag behind? Hence, karvy launched “karvy
global services limited” after entering into a joint venture with Computershare, Australia
in the year 2004.the year 2004 also saw karvy entering into commodities marketing
through karvy comtrade.
Year 2005 saw karvy establishing a separate branch for its insurance services under the
head “ karvy insurance broking ltd” and in the same year, after being impressed with the
rapid growth of karvy stock broking limited, PCG group of Hong Kong acquired 25%
stake at KSBL. In the year 2006, karvy entered into one of the hottest sector of present
time i.e real estate through Karvy realty& services (India) ltd. hence , we can see now
karvy being established as the lagest financial service provider of the country.

Now karvy group consists of 8 highly renowned entities which are as follow:

KARVY CONSULTANTS LIMITED

The first securities registry to receive ISO 9002 certification in India. Registered with
SEBI as Category I Registrar, is Number 1 Registrar in the Country. The award of being
  ‘Most Admired’ Registrar is one among many of the acknowledgements we received for
our customer friendly and competent services.
  
KARVY STOCK BROKING LIMITED
 

karvy stock broking ltd. Consists of five units namely stock broking servics, depository
  participant, advisory services, distribution of financial products, advisory services and
private client goups.

 
 
Distribution of
Financial Products
 

  The paradigm shift from pure selling to knowledge

based selling drives the business today. With our wide
portfolio offerings, we occupy all segments in the retail
 financial services industry.

  
KARVY INVESTOR SERVICES
  LIMITED

it is registered with SEBI as a category 1 merchant banker. Its clientele includes include
  leading corporates, State Governments, foreign institutional investors, public and private
sector companies and banks, in Indian and global markets.
  
KARVY Computershare Private
Limited
 

 
it is a joint venture between Computershare, Australia and Karvy Consultants Limited, India in the
  registry management services industry.
  

 
KARVY GLOBAL SERVICES LIMITED

Karvy Global is a leading business and knowledge process outsourcing Services Company
offering creative business solutions to clients globally. It operates in banking and financial
  services, inurance, healthcare and pharmaceuticals,
media , telecom and technology. It has its sales and business development office in New
York, USA and the offshore global delivery center in Hyderabad, India
  
Karvy Comtrade Limited
 

  
The company provides investment, advisory and brokerage services in Indian
  Commodities Markets. And most importantly, it offer a wide reach through our branch
network of over 225 branches located across 180 cities.
  
  Karvy Insurance Broking Limited
  karvy insurance broking ltd is also a part of karvy stock broking ltd. At Karvy Insurance
  Broking Limited both life and non-life insurance products are provided to retail
individuals, high net-worth clients and corporates.
KARVY
  REALTY&SERVICES(INDIA)Limited

Karvy Realty (India) Limited is engaged in the business of real estate and property services
offering:
Buying/ selling/ renting of properties
Identifying valuable investments opportunities in the real estate sector
Facilitating financial support for real estate and investments in properties
Real estate portfolio advisory services

Organization structure of karvy:

Talking about the organization structure of karvy, we have the board of directors as the supreme
governing body , the chairman being Mr. C parthasarthy, mr. m yugandhar as the managing director, mr
m s ramakrishna andmr. Prasad v. potluri as directors.

The board of diretors head the karvy group, karvy computershares limited, karvy investors
services ltd., karvy comtrade, karvy stock broking ltd., and karvy global services ltd.
Karvy group being the flagship company looks after the functional departments such as
corporate affairs, group human resources, finance & accounting, training & development,
technology services and corporate quality.

Karvy computershare private limited facilitates mutual fund services, share registry and issue
registry whereas merchant banking is looked after by karvy investor services ltd. Karvy stock
broking ltd heads its another branch too ie. Karvy insurance broking ltd. The services offered by
KSBL are: stock broking, depository, research, distribution, personal client group and
institutional desk. And finally the BPO services are managed by karvy global services ltd.
Summarizing it in a diagram, it can be presented as:
KARVY SERVICES – AN OVERVIEW
________________________________________

1. Stock broking
2. Demat services
3. Investment product distribution
4. Investment advisory services
5. Corporate finance & Merchant banking
6. Insurance
7. Mutual fund services
8. IT enabled services
9. Registrars & Transfer agents
10. Loans

1. Stock Broking:

KARVY is working as Capital Market Intermediaries. Stockbrokers

are regulated by SEBI [Stock-brokers and Sub-brokers]
Regulations, 1992. The stockbroker is a member of the stock
exchange. Stockbrokers are the intermediaries who are allowed
to trade in securities on the exchange of which they are
members. They buy and sell on their own behalf as well as on
behalf of their clients.
Stockbrokers expand their business by engaging sub-broker.
Sub-brokers mean “any person not being a member of a stock
exchange who acts on behalf of a stock broker as an agent or
otherwise for assisting the investors in buying, selling or dealing
in securities through such stock-brokers.”

2. Demat Services:

Karvy is a depository participant with the National Securities

Depository Limited (NSDL) for trading and settlement of
dematerialized shares.
Depository Participants (DPs) are described as an agent of the
depository. They are intermediaries between the depository and
the investors. The relationship between the DPs and the
depository is governed by an agreement made between the two
under Depositories Act.
A DP can offer depository-related services only after obtaining a
certificate of registration from SEBI.
Since Karvy is also in the broking business, investors who use
Karvy’s depository services get a dual benefit. They can use
Karvy’s brokerage
services to execute transactions and Karvy’s depository services
to settle them.

3. Investment Products Distribution:

Company is also concern with the distribution of investment
products like

(a). Fixed Deposit

(b). Bonds
(c). IPO
(a). Fixed Deposit:

KARVY is dealer of 34 fixed deposits of various types which

includes fixed deposits of Public Sector, Non Banking Finance
Companies, Housing Finance Companies and Manufacturing
Companies.

4. Investment Advisory Services:

This division provides portfolio management services to high net-
worth individuals and corporate. The expertise of Karvy in
research and stock broking gives it the right perspective to
provide investment advisory services. Company provides advisory
services to its clients.
Financial goal of each individual investor varies according to his
dream, ambition and family size and future financial planning for
the children & old age pension for self and wife so does the
pathway to achieve it. Karvy apply the principles of Financial
Planning as both science & art, it understands the time horizon,
risk bearing capacity and investment goals of investors keeping in
mind their psyche and financial needs. Based upon this Karvy
helps individual investors to plan their entire life up to retirement,
Taxes, Insurance needs and other important personal financial
goals. It designs portfolio for investor to invest their saving in
various financial products like shares, bonds, debentures, mutual
funds, fixed deposits, insurance etc., Company design portfolio by
considering following factors.
Investor’s requirement of getting money back,
Investor’s willingness to take risk,
Investor’s tax planning etc.

5. Corporate finance & Merchant banking:

Corporate finance is the financial activity of corporation. It deals
with the firm's operations with regard to investing and financing.
It concerned with how firms raise capital and the consequences of
alternative methods of raising capital. Firm’s capital can be raised
by raising loans, issuing shares, and acquiring or merging with
other businesses by public or private companies.
Merchant banking is a financial intermediation that matches
entities that need capital and those that have capital. Hence they
facilitate the flow of capital in the market.
Karvy enjoys SEBI category (I) authorization for Merchant
Banking. Karvy offers the full spectrum of Merchant Banking
Services, beginning from identifying the best time for an issue to
final stage of marketing it, to harvest unparalleled success.
As a merchant banker Karvy offer following services:
Issue management
Instrument designing
Pricing of the issue
Registration process for the issue of shares
Marketing efforts
Final allotment to investors
Listing details on stock exchanges
Loan syndication
Lease financing
Corporate advisory services
Underwriting
Portfolio management

6. Insurance:
Karvy is also dealer of many private life insurance companies. At
Jamnagar branch, company is associated with dealing of following
companies.
ICICI Prudential Life Insurance
HDFC Life Insurance
TATA AIG Life Insurance

7. Mutual Fund Services:

Since its inception in 1982, Karvy has demonstrated a dedication
coupled with dynamism that has inspired trust from various
segments – corporate, government bodies and individuals. Karvy
has since been performing a pivotal role as the intermediary –
the interface – between these players.
With Mutual Funds emerging as a distinct asset class, Karvy has
made a strategic choice to leverage the power of latest
technology to provide a cutting edge to its services. Karvy, today,
service nearly 80% of the asset management companies (AMCs)
across an extensive network of service centers with assets under
service in excess of Rs.10,000 crores.
Karvy's ability to mass customize and offer a diverse range of
products for a diverse range of customers has helped mutual fund
companies to uniquely position themselves in the market place.
These diverse range of services cut across multiple delivery
channels – service centers, web, mobile phones, call center – has
brought home the benefits of technology to investors,
distributors, and the mutual funds.
Going forward, Karvy shall strive to create new products and
services, which would address the needs of the end customer.
Company’s single minded focus in delivering products for
customers has given it the distinguished position of being the
preferred provider of financial services in the country.

List of Mutual Fund Clients of KARVY:

1 Alliance Mutual Fund
2 Birla Mutual Fund
3 Bank of Baroda Mutual Fund
4 Can Bank Mutual Fund
5 Chola Mutual Fund
6 Deutsche Mutual Fund
7 DSP Merrill Lynch Mutual Fund
8 Franklin Templeton Investments
9 GIC Mutual Fund
10 HDFC Mutual Fund
11 HSBC Mutual Fund
12 IL & FS Mutual Fund
13 JM Mutual Fund
14 Kotak Mutual Fund
15 LIC Mutual Fund
16 Punjab National Bank Mutual Fund
17 Prudential ICICI Mutual Fund
18 Principal Mutual Fund
19 Reliance Mutual Fund
20 State Bank of India Mutual Fund
21 Standard Chartered Mutual Fund
22 Sundaram Mutual Fund
23 SUN F&C Mutual Fund
24 Tata Mutual Fund

8. Income Tax enabled services:

Karvy has been started this service since March, 2004. Karvy is
work as TIN Facilitation Centre it provides following IT enabled
services.
a. Distribution of PAN Card.
b. Distribution of TAN Card.
c. Services related to e-TDS.
Karvy work as an intermediary between NSDL and IT payers.
Karvy provides various form for different IT enabled services and
guide people to fill that forms. It also solves queries of the tax
payers. It also distributes PAN and TAN card to the tax payers.

9. Registrars & Transfer agents:

In 1985, Karvy entered the Registrar and Share Transfer Business
to create a market niche in the competitive field of financial
services. In 1994-95, it reached a milestone when it processed
104 Public Issues constituting 46 per cent market share. Now in
its second decade of existence, Karvy is the leader in the
industry: In an opinion poll conducted by an independent market
research agency - MARG, Karvy has been rated as India’s Most
Admired Registrar on various parameters: -
Overall Excellence.
Handling of Volumes
Timely Dispatch
Quality Management and Technological Up gradation.
A SEBI Category 1 Registrar, So far, Karvy has handled over 675
ISSUES as Registrars to public issues processed over 52 million
applications and is servicing over 16 million investors from
various locations spread over 205 clients.

10. Loan:
Karvy has recently started this service at selected branches of
metro cities. This service has not been started in Saurashtra-
Kucch region. Karvy provides loans for following.
Vehicle Loan
Home Loan
Personal Loan

MARKETING STRATEGY OF KARVY

________________________________________
Market Positioning:
Market positioning statements of Karvy are “At Karvy we give you
single window service” and “We also ensure your comfort”.
So, Karvy focus on the consumers who prefer almost all
investment activities at same place by providing number of
various financial services. At Karvy a person can purchase or sell
shares, debentures etc. and at the same place also demat it.
Karvy also provides other investment option to the same person
at same place like Mutual Fund, Insurance, Fixed Deposit, and
Bonds etc. and help the person in designing his portfolio. By this
way Karvy provides comfort to its customers.
Karvy is also positioned according to Ries and Trout. Karvy is
promoted as a no. 1 investment product distributor and R & T
agent of India.

Target Market:

Karvy uses demographic segmentation strategy and segment

people based on their occupation. Karvy uses selective
specialization strategy for market targeting. Target person for the
Karvy Stock Broking and Karvy Investment Service are persons
who can work as sub-broker for the companies. Companies focus
on Advisors of Insurance and post office, Tax consultants and CAs
for making sub-broker.

Marketing channel System:

Karvy uses one level marketing channel for investment product
distribution. Sub-brokers work as intermediary between
consumer and company. Company has both forward and
backward flow of activity through channel. Company distributes
stationery, brokerage, and information forward to its sub-broker.
The sub-brokers send filled forms, queries, amount of investment
etc. back to the company.

Training Channel Members:

Karvy provides training to the sub-brokers because they will be

viewed as the company by the investors. The executives of Karvy
explain various new schemes of investment to the sub-brokers
with its objective, risk factors and expected return. Company also
periodically arrange seminar to guide sub-brokers.

Advertising and Promotion:

The objective of advertising of Karvy is to create awareness about

services of Karvy among investors and sub-brokers and increase
sub-brokers of Karvy.

Company doesn’t give advertisement in media like TV,

Newspapers, and Magazines etc. Karvy’s advertisement is made
indirectly by the companies associate with it. Karvy is R & T agent
of around 700 companies. They publish name, address and logo
of Karvy on their annual report.

Karvy also publish its weekly Stock Market Newsletter ‘Karvy

Bazaar Baatein’ and monthly magazine ‘The Finapolis’ to guide
investors and sub-brokers about market.
HR POLICY OF KARVY
________________________________________

Karvy’s HR Department is located at Hyderabad.

Recruitment and Selection Policy:

The upper level members like zonal managers, regional

managers, branch managers and senior executives are recruited
by publishing recruitment advertisement in leading national level
newspaper. The qualified applicant are then called for interview
and selected.

The regional manager has authority to select lower level

employee like peon, marketing executives, accountant etc. by
approval of zonal manager.

Training and Development:

Continuous training and upgrading technical, behavioral and

managerial skills is a way of life in Karvy. Karvy encourages
employees to hone their skills regularly to enable them to face
the challenges of the changing requirements of customers that fit
market up and down.

Training needs analysis is done on a regular basis and systematic

methodologies are ensured that skills and capabilities of all
employees are constantly upgraded to enable them to perform in
the challenging work environment.
New employee has given training under experienced employee.
The new employee work under experience employee and observe
his all activities. When company employs new technology or there
is any change in the working of company the training program is
arranged.

Employee Motivation:

Karvy’s employees are highly empowered. They don’t have to

report any person of the same branch but they report upper level
branch. E.e. Marketing executive of Jamnagar branch directly
reports Senior Marketing executive of Baroda zonal office.

If particular branch earn certain profit then Karvy gives them

special incentives. E.g. last year Karvy had arranged two days
tour of Div for their employees of Rajkot, Jamnagar, Junagadh
and Bhavnagar branch which was totally free of cost. This also
helps in maintaining co-operation between employees.

Quality Policy Of Karvy:

To achieve and retain leadership, Karvy shall aim for complete
customer satisfaction, by combining its human and technological
resources, to provide superior quality financial services. In the
process, Karvy will strive to exceed Customer’s expectations.
Quality Objectives of Karvy

Build in-house processes that will ensure transparent and

harmonious relationships with its clients and investors to provide
high quality of services.

Establish a partner relationship with its investor service agents

and vendors that will help in keeping up its commitments to the
customers.

Provide high quality of work life for all its employees and equip
them with adequate knowledge & skills so as to respond to
customer's needs.

Continue to uphold the values of honesty & integrity and strive to

establish unparalleled standards in business ethics.

Use state-of-the art information technology in developing new

and innovative financial products and services to meet the
changing needs of investors and clients.

Strive to be a reliable source of value-added financial products

and services and constantly guide the individuals and institutions
in making a judicious choice of same.

Strive to keep all stake-holders (shareholders, clients, investors,

employees, suppliers and regulatory authorities) proud and
satisfied.

Achievements of Karvy:

Largest mobilizer of funds as per PRIME DATABASE

First ISO - 9002 Certified Registrar in India
A Category- I Merchant banker
A Category- I Registrar to Public Issues
Ranked as "The Most Admired Registrar” by MARG
Handled the largest- ever Public Issue - IDBI
Strategic tie-up with Jardine Fleming India Securities Ltd
Handled over 500 Public issues as Registrars
Handling the Reliance Account which accounts for nearly 10
million account holders
First Depository Participant from Andhra Pradesh

INDUSTRY DETAILS
________________________________________

Sr. No. Mutual Fund Name No. of Schemes

1 Alliance Mutual Fund 36
2 Benchmark Mutual Fund 5
3 Birla Mutual Fund 74
4 Bank of Baroda Mutual Fund 17
5 Can Bank Mutual Fund 25
6 Chola Mutual Fund 45
7 Deutsche Mutual Fund 40
8 DSP Merrill Lynch Mutual Fund 40
9 Escorts Mutual Fund 15
10 Franklin Templeton Investments 130
11 GIC Mutual Fund 5
12 HDFC Mutual Fund 79
13 HSBC Mutual Fund 32
14 IL & FS Mutual Fund 43
15 ING Vysya Mutual Fund 55
16 JM Mutual Fund 55
17 Kotak Mutual Fund 56
18 LIC Mutual Fund 35
19 Morgan Stanley Mutual Fund 1
20 Punjab National Bank Mutual Fund 4
21 Prudential ICICI Mutual Fund 124
22 Principal Mutual Fund 68
23 Reliance Mutual Fund 74
24 Sahara Mutual Fund 12
25 State Bank of India Mutual Fund 59
26 Standard Chartered Mutual Fund 100
27 Sundaram Mutual Fund 52
28 SUN F&C Mutual Fund 1
29 Tata TD Mutual Fund 100
30 Taurus Mutual Fund 9
31 Unit Trust of India 42
32 UTI Mutual Fund 66

HISTORY OF MUTUAL FUND

Development of Mutual Funds in India

The mutual fund industry in India started in 1963 with the

formation of Unit Trust of India, at the initiative of the
Government of India and Reserve Bank the. The history of mutual
funds in India can be broadly divided into four distinct phases

FirstPhase-1964-87
Unit Trust of India (UTI) was established on 1963 by an Act of
Parliament. It was set up by the Reserve Bank of India and
functioned under the Regulatory and administrative control of the
Reserve Bank of India. In 1978 UTI was de-linked from the RBI
and the Industrial Development Bank of India (IDBI) took over
the regulatory and administrative control in place of RBI. The first
scheme launched by UTI was Unit Scheme 1964. At the end of
1988 UTI had Rs.6,700 crores of assets under management.
Second Phase – 1987-1993 (Entry of Public Sector Funds)
1987 marked the entry of non- UTI, public sector mutual funds
set up by public sector banks and Life Insurance Corporation of
India (LIC) and General Insurance Corporation of India (GIC). SBI
Mutual Fund was the first non- UTI Mutual Fund established in
June 1987 followed by Canbank Mutual Fund (Dec 87), Punjab
National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund
(Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund
(Oct 92). LIC established its mutual fund in June 1989 while GIC
had set up its mutual fund in December 1990.
At the end of 1993, the mutual fund industry had assets under
management of Rs.47,004 crores.

Third Phase – 1993-2003 (Entry of Private Sector Funds)

With the entry of private sector funds in 1993, a new era started
in the Indian mutual fund industry, giving the Indian investors a
wider choice of fund families. Also, 1993 was the year in which
the first Mutual Fund Regulations came into being, under which
all mutual funds, except UTI were to be registered and governed.
The erstwhile Kothari Pioneer (now merged with Franklin
Templeton) was the first private sector mutual fund registered in
July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a
more comprehensive and revised Mutual Fund Regulations in
1996. The industry now functions under the SEBI (Mutual Fund)
Regulations 1996.
The number of mutual fund houses went on increasing, with
many foreign mutual funds setting up funds in India and also the
industry has witnessed several mergers and acquisitions. As at
the end of January 2003, there were 33 mutual funds with total
assets of Rs. 1,21,805 crores. The Unit Trust of India with
Rs.44,541 crores of assets under management was way ahead of
other mutual funds.

Fourth Phase – since February 2003

In February 2003, following the repeal of the Unit Trust of India
Act 1963 UTI was bifurcated into two separate entities. One is the
Specified Undertaking of the Unit Trust of India with assets under
management of Rs.29,835 crores as at the end of January 2003,
representing broadly, the assets of US 64 scheme, assured return
and certain other schemes. The Specified Undertaking of Unit
Trust of India, functioning under an administrator and under the
rules framed by Government of India and does not come under
the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB,
BOB and LIC. It is registered with SEBI and functions under the
Mutual Fund Regulations. With the bifurcation of the erstwhile UTI
which had in March 2000 more than Rs.76,000 crores of assets
under management and with the setting up of a UTI Mutual Fund,
conforming to the SEBI Mutual Fund Regulations, and with recent
mergers taking place among different private sector funds, the
mutual fund industry has entered its current phase of
consolidation and growth. As at the end of September, 2004,
there were 29 funds, which manage assets of Rs.153108 crores
under 421 schemes.
The graph indicates
REGULATORY BODIES
________________________________________

Financial System is basically responsible for the major up and

downs in the economy. So, there are some regulatory bodies on
it which ensures effectiveness in the management of fund of the
investors and transparency in the transactions.
Ministry of Finance

SEBI RBI Dept. of IT

Stock Brokers Commercial PAN

R & T Agent Banks TAN
Mutual Fund NBF Co. E-TDS

[Fig.8: Regulatory bodies]

COMPETITORS DETAILS
________________________________________

1. Bajaj Capital

It was established in 1964 at Delhi. In 1965 it innovates a new

financial instrument ‘Companies Fixed Deposits’ and becomes the
first company to raise Fixed Deposits. The objective of company
is to provide professional guidance to investors on where, when
and how to invest and to assist the corporate sector in its
resource raising activities. Bajaj Capital became the first company
to set up ‘Investment Centers’ all over India for this purpose.
Today, Bajaj Capital has 90 offices in over 40 important Indian
Cities and has a team of around 500 employees nationwide.
Services provided

Merchant banking
Buying and Selling of Money Market Investments
Distribution of financial products
Investment Advisory Service

» Company fixed deposits

» Bonds
» Mutual funds
» Life insurance
» General insurance
» Pension schemes
» Post office schemes
» Tax saving schemes
» Insurance linked investment schemes
» Initial public offerings
» Housing loans
» NRI schemes
» Car insurance

Financial Planning

» Investment planning
» Retirement planning
» Insurance planning
» Children's future planning
» Tax planning
» Short-term cash flow planning

2. MCS Ltd.
It is established in 1985 in Delhi. It is one of the largest Data
Processing House employing more than 600 people.
MCS Ltd. has 8 branches all over India.

Volumes Handled
Share registry activities for over 100 corporate servicing over 10
million investors.
Mutual fund operations for 25 funds, servicing over 4.5 million
investors.
Billing & settlement plan for Indian operations of IATA Geneva for
1.2 million tickets per annum covering (26 airlines & over 1200
agents).

Services Offered:
Registrars and Transfer Agents
Registrars to IPO’s /Right Issues
Registrars to Open Offers
Registrars to Mutual Funds
Data Processing for Airlines
Print Shop Services
MCS is a major player in these activities in the Country with a
market share of about 25%. MCS today provides these services
to over 140 Corporate and Mutual Funds for a total investor base
of 15 million.

3. N.J.India Investments Pvt. Ltd.

NJ India Invest (formerly known as NJ Capital stocks) was started
in 1994 to cater to the growing financial services sector. NJ India
Invest evolved out as a client focused need based investment
advisory firm. NJ regards mutual fund as one of the best
investment avenue available to satisfy any kind of investment
need.
4. ICICI Securities Ltd.
ICICI Securities Limited (i-SEC) is a wholly owned investment-
banking subsidiary of ICICI Limited. ICICI is the only non-
Japanese Asian financial institution to be listed on the New York
Stock Exchange (NYSE). ICICI Securities was formed on 22nd
Feb. 1993, when ICICI's Merchant Banking Division was spun off
into a new company, ICICI Securities today is India's leading
Investment Bank and one of the most significant players in the
Indian capital markets. ICICI Brokerage Services Limited (IBSL)
set up in March 1995, IBSL is a 100% subsidiary of i-SEC. It
commenced its securities brokerage activities in February 1996
and is registered with the National Stock Exchange of India
Limited and The Stock Exchange, Mumbai.
ICICI has started a website ICICIdirect.com which is the most
comprehensive website, which allows you to invest in Shares,
Mutual funds, Derivatives (Futures and Options) and other
financial products.
ICICI has a large network of branches all over India.
Services offered:

Merchant Banking
Demat Service
Stock Broking

5. HDFC

HDFC is the leading financial company in India. IT has large

network of branches all over India. HDFC Securities which is fully
subsidiary of HDFC provides demat service.
HDFC and its subsidiary provides following services.

Demat Service
Life Insurance
Banking Service
Housing Finance
Vehicle Finance
Education Loan
Personal Loan
Mutual Fund

6. Kotak Securities Ltd.

Kotak Securities needs no introduction as one of the largest stock

broking houses in the country and a leading distributor of primary
market offerings. Kotak Securities limited is a joint venture
between Kotak Mahindra Bank and Goldman Sachs, the
international investment banking and brokerage firm.
Kotak Securities is a corporate member of both the BSE and the
NSE. It is also a depository participant with the National
Securities Depository Limited (NSDL) for trading and settlement
of dematerialized shares.

Services offered:

Stock Broking
Financial Product Distribution
Demat Services
Investment Advisory Services

7. Motilal Oswal Securities Ltd.

Motilal Oswal Securities Ltd (MOSt) is one of the leading equity

research and broking houses of India. MOSt has a 20-member
research team, which is engaged round the clock in analyzing the
Indian economy and corporate sectors to identify equity
investment ideas. Asia Money Broker's Poll 2002 has rated MOSt
as one of the best Indian broking house, for research, for the
second time since 2000.

Motilal Oswal is member of NSDL and CDSIL for DP. It has wide
network of branches. It has 158 branches all over India.

Services Offered:

Demat Services
Stock Broking
Investment Advisory Service

PRODUCT DETAILS
________________________________________

Mutual funds serve as a link between the saving people and the
capital market in that they mobilize saving from investors and
bring them to borrowers in the capital markets. In short, it is a
common pool of money into which investors place their
contribution that is to be invested in accordance with a stated
objective.

A mutual fund uses the money collected from the investors to buy
those assets, which are specially permitted by its stated
investment objective. When an investor subscribes to a mutual
fund, he/she buys a part of asset or the pool of funds that are
outstanding at that time.

A mutual fund is constituted as an investment company and an

investor buys into the fund, means he buys the share of the fund
and is known as a unit holder. Since each unit holder is a part of
owner of a mutual fund, it is necessary to establish the value of
his part. Since the unit held by an investor evidences the
ownership of the fund’s assets, the value of the total asset of the
fund when divided by the total number of units issued by the
mutual fund gives us the value of one unit. This is called as Net
Asset Value (NAV).

STRUCTURE OF INDIAN MUTUAL FUNDS

________________________________________

Mutual fund industry is highly regulated by the government

keeping in view of the protection of investor’s interest as well as
to maintain operational transparency.

In India SEBI Regulations Act, 1996, guides the formation and

operation of Mutual Funds. A Mutual Fund comprises of 4
separate entities.

1. Sponsor
2. Board of Trusties
3. Asset Management Company
4. Custodian and Depositories
5. Distributors

1. Sponsor:

“Sponsor” is defined under SEBI regulation as any person who,

acting alone or in combination with another body corporate,
establishes a mutual fund. The sponsor gets the fund registered
with SEBI. The sponsors form a trust and appoint a Board of
Trustees.
The sponsor must contribute at least 40% of the net worth of the
AMC.
The sponsor must posses a sound financial track record over 5
years prior to registration.

2. Board of Trustees:

Mutual funds are managed by Board of Trustees. Trust is created

by a document called the Trust Deed that is executed by fund
sponsor in favour of trustees.

The trustees appoint the AMC and custodian with the prior
approval of SEBI.
They also approve all the schemes floated by the AMC.
They have right to dismiss the AMC, with the approval of SEBI.
Half of the trustees should be independent persons. Neither the
AMC, nor its employees can act as trustee.
A trustee can not be appointed as a trustee of two or more
mutual funds until and unless he is an independent person or has
permission from the Mutual Fund where he is trustee.
Trustees can be removed only by prior approval of SEBI.

3. Asset Management Company:

The role of an AMC is to act as the investment manager of the

Trust under the Board supervision and direction of the Trustees.
The AMC is required to be approved and registered with SEBI.

The AMC of a Mutual Fund must have a net worth of at least Rs.
10 crore at all time.
The AMC can not act as a trustee of any other Mutual Fund.
They will float schemes only after obtaining the prior approval of
the Trustees and SEBI.
The director of AMC should be a person of reputed of high
standing and at least have five years experience in relevant field.
AMC can be terminated with 75% unit holders or majority of
trustees.

4. Custodian and Depositories:

As per SEBI Regulations Mutual Funds shall have a custodian who

is not any way associated with the AMC. It carry outs the activity
of safe keeping the securities or participating, in any clearing
system. The custodian should be independent from sponsors and
AMC and should have a sound track record and adequate relevant
experience.

As Indian capital markets are moving away from having physical

certificates to ownership of these securities in “dematerialized”
form with Depository. Mutual Fund’s “dematerialized” securities
are hold by depository participant.

5. Distributors:

For a fund to sell units across a wide retail base of individual

investors, an established network of distribution agents is
essential. AMCs usually appoint Distributors or Brokers, who sell
units on behalf of the fund. A broker usually acts on behalf of
several mutual funds simultaneously and may have several sub-
brokers under him for the purpose of distribution of units.
MUTUAL FUND – A GLOBALLY PROVEN INVESTMENT
________________________________________

Worldwide, the mutual fund has a long and successful history.

The popularity of mutual fund has increased manifold. In
developed financial market, like US mutual funds have almost
overtaken bank deposits and total assets of over US $ 3 trillion.

In India, Mutual Fund industry started with the setting up of UTI

in 1964. Public sector banks and financial institution began to
establish Mutual Funds in 1987. The private sector and foreign
institutions were allowed to set up Mutual Fund in 1993.

WHAT IS MUTUAL FUND?

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.

Critical View About Mutual Fund

Advantage

1. Portfolio Diversification:

Each investor in a fund is a part owner of all the funds assets,

thus enabling investor to hold a diversified investment portfolio
even with a small amount of investment, which would otherwise
require big capital.

2. Professional Management:

Mutual Funds provide the services of experienced and skilled

professionals, backed by a dedicated investment research team
that analyze the performance and prospect of companies and
selects suitable investments to achieve the objectives of the
scheme.

3. Diversification:

Mutual Fund invests in a number of companies across a broad

cross-section of industries and sectors. This diversification
reduces the risk because all stock can not go through a
downtrend at the same time and in the same proportion. You
achieve this diversification through a mutual fund with powerless
money that you can do on your own.

4. Reduction of Transaction Cost:

The investors bear all the cost of investing such as brokerage or

custody of securities. When going through the fund investor has
the benefit of economies of scale; the funds pay lesser cost
because of larger volumes, a benefit passed on to its investors.

5. Liquidity:

By investing in Mutual Funds the investors can cash their

investment by selling their units to the fund if open-ended, or
selling them in the stock market if the fund is close ended.

6. Convenience & Flexibility:

Mutual Funds Companies offer investor to transfer their holding

from one scheme to other.

7. Tax Benefits:

The investors are totally exempt from paying any tax on the
income they receive from the Mutual Funds.
Investment up to 10000 in ELSS qualifies for tax rebate of 20%.

8. Regulatory oversight:

Mutual funds are subject to many government regulations that

protect investors from fraud.

9. Convenience:

You can usually buy mutual fund shares by mail, phone, or over
the Internet.
10. Well regulated

Limitations:

1. No Control over Costs:

An investor in a mutual fund has no control over the overall cost

of investing. He/she has to pay investment management fees as
long as he/she remains with the fund. Fees are payable even
while the value of the investment may be declining.

2. No Tailor made Portfolios:

Investors who invest on their own can build their own portfolios
of shares and bonds and other securities. Investing through fund
means he/she delegates this decision to the fund managers.

3. Managing a Portfolio of Funds:

Availability of a large number of funds can actually mean too

much choice for the investor. He/she may again need advice on
how to select a fund to achieve his/her objectives, quite similar to
the situation when he/she has to select individual shares or bonds
to invest in.

4. Entry and Exit Cost:

When large bodies like a fund invest in shares, the concentrated

buying or selling often result in adverse price movements i.e. at
the time of buying, fund has to pay high and vise-versa.
5. No Guarantees:

No investment is risk free. If the entire stock market declines in

value, the value of mutual fund shares will go down as well, no
matter how balanced the portfolio. Investors encounter fewer
risks when they invest in mutual funds than when they buy and
sell stocks on their own. However, anyone who invests through a
mutual fund runs the risk of losing money.

MUTUAL FUND CYCLE

________________________________________

From the shown cycle, it can be observed clearly that how the
money from the investors flow and they get returns out of it.
With a very small amount of fund, investors pool their money
with fund managers.

After studying the market, the fund manager invests money of

the investors in various securities like shares, bonds, debentures,
government securities etc. to achieve goal of the investors.

With ups and downs in the market returns are generated and
they are passed on to the investors in form of dividend or capital
gain or lost. The above cycle is very clear and also very effective.

The fund manager while investing on behalf of investors takes

into consideration various factors like time, risk; amount etc. so
that he/she can make proper investment decision.

Types of Mutual Fund

________________________________________
1. By objective:
Investment goals vary from person to person. While somebody
wants security, others might give more weightage to returns
alone. Somebody else might want to plan for his child’s education
while somebody might be saving for the proverbial rainy day or
even life after retirement. With objectives defying any range, it is
obvious that the products required will vary as well. So, Mutual
funds can be classified based on the objectives of the investor.
(a). Equity Fund:

Equity funds invest a major portion of their corpus in equity

shares issued by companies. NAV of equity funds are fluctuated
by fluctuation in price of shares that it holds. So there is a high
risk as well as high return in equity fund. Potential to earn in such
funds is higher when they are invested for long term.
The leading example of such funds are
Prudential ICICI Growth Plan,
Tata Pure Equity Fund,
Reliance Vision,
Franklin India Prima Fund etc.

(b). Debt Fund:

Debt funds invest in debt instruments debt instruments issued by

governments, private companies, banks and financial institutions.
By investing in debt, these funds target low risk and stable
income investors. These funds are low risk low return funds.

The leading examples are

Birla Income Plus,

Principal Income Fund,
HDFC Income Fund,
UTI Bond Fund etc.
(c). Balanced Fund:

A balanced fund is one that has a portfolio comprising debt

instruments as well as preference and equity shares. The idea is
to reduce volatility of funds, while providing some upside for
capital appreciation. They are best suitable for the people looking
for a combination for capital appreciation and regular income and
best time spend for such investment is more than 3 years.
The leading examples are
Prudential ICICI Balanced Fund,
Birla Balance Fund,
Franklin India Balance Fund,
Sundaram Balance Fund etc.

(d). Money Market Fund:

Money market funds invest in securities of a short-term nature,

which generally means securities of less than one-year maturity
such as Treasury Bills issued by governments, Certificates of
deposit issued by banks and Commercial paper issued by
companies.

The major strength of money market funds are the liquidity and
safety of principal that the investors can normally expect from
short term investments.
The leading examples are

Prudential ICICI Liquid Plan,

Templeton India Liquid Fund,
Grindlays Cash Fund etc.

(e). Gilt Fund:

These funds are sort of government funds wherein the
investments are made in debt instrument of government, which
carry no risk of non payment of interest as the RBI manages the
payment of interest and principal on the investments. These
funds are best suited for regular income and long term
investment objectives.
The leading examples are
Prudential ICICI Gilt Fund,
Tata Gilt Securities Fund,
Templton India Government Securities Fund etc.

2. By Duration:

(a). Open-ended Fund:

An open ended fund is one that is available for subscription and

repurchase on a continuous basis. These schemes do not have a
fixed maturity period. Investors can conveniently buy and sell
units at NAV related prices which are declared daily basis. The
key feature of this fund is liquidity.

(b). Close-ended Fund:

A close ended fund has a stipulated maturity period e.g. 5-7

years. The fund is open for subscription only during a specified
period at the time of launch of the scheme. Investors can invest
in the scheme at the time of initial public issue and thereafter
they can buy or sell units on stock exchange where the units are
listed at NAV. These mutual fund schemes disclose NAV generally
on weekly basis.

(c). Interval Fund:

Interval funds combine the features of open-ended and close-
ended schemes. They are open for sale or redemption during pre
determined intervals at NAV related prices.

Risk Return Grid

Risk Tolerance/Return Expected Focus Suitable Products Benefits

offered by MFs
Low Debt Bank/ Company FD, Debt based Funds Liquidity, Better
Post-Tax returns
Medium Partially Debt, Partially Equity Balanced Funds, Some
Diversified Equity Funds and some debt Funds, Mix of shares and
Fixed Deposits Liquidity, Better Post-Tax returns, Better
Management, Diversification
High Equity Capital Market, Equity Funds (Diversified as well as
Sector) Diversification, Expertise in stock picking, Liquidity, Tax
free dividends

3. By Load:

(a). Load Fund:

Marketing of new mutual fund scheme involves initial expenses.

These initial expenses may be recovered from the investors by
entry or exit load.

(i). Entry Load or Front-end Load:

If initial expenses recovered from investors at the time of

investor’s entry into the fund, by deducting a specific amount
from his initial contribution it is called Entry Load.

(ii). Exit Load or Back-end Load:

If initial expenses recovered at the time of the investor’s exit

from the scheme, by deducting a specified amount from the
redemption proceeds payable to the investor it is called exit load.

(iii). Deferred Load:

The load amount charged to the scheme over a period of time is

called a deferred load.

(b). No Load Fund:

Funds that don’t charge entry, exit, or deferred load or any other
charges for sales expenses are called no load funds.

Now, generally all Mutual Fund companies charge 2 to 2.5% entry

load on equity fund.

Generally there is no exit load on equity and sectoral funds to

maintain liquidity of that funds.

Generally there is no entry load on gilt scheme and income fund.

There is 0.25 to 1% exit load on gilt and income fund if investors

exit from fund before specified time which is generally 3 to 6
months.
4. Other types of fund:

(a). Tax Saving Funds:

These schemes offer tax rebates to the investors under specific

provisions of the Income Tax Act, 1961 as the Government offers
tax incentives for investment in specified avenues. E.g. Equity
Linked Saving Scheme (ELSS). Pension schemes also offer tax
benefits.

The leading examples are

Prudential ICICI Tax Plan,

Templeton India Pension Plan,
Franklin India Taxshield etc.

(b). Index Funds:

Index Funds replicate the portfolio of a particular index such as

the BSE Sensitive index, S&P NSE 50 index (Nifty), etc. These
schemes invest in the securities in the same weightage
comprising of an index. NAV of such funds are changed
accordance with the change in the index.

The leading examples are

Birla Index Fund,

HDFC Index Fund,
Prudential ICICI Index Fund,
UTI Index Fund etc.
(C). Sector Funds:

These are the funds which invest in the securities of only those
sectors or industries as specified in the offer documents. E.g.
Pharmaceuticals, Software, Petroleum etc. These types of funds
are more risky compared to diversified funds.

The leading examples are

Birla IT Fund,
Pru. ICICI FMCG Fund,
Franklin India Pharma Fund etc.

(d). Commodity Funds:

Commodity funds invest into the different commodities directly or

through shares of commodity companies. E.g. Commodity fund
invest in gold or shares of gold mines. Commodity funds have not
yet developed in India.

(e). Off Shore Funds:

These funds invest in equities in one or more foreign countries

there by achieving diversification across the country’s borders.
However they also have additional risks such as the foreign
exchange rate risk and their performance depends on the
economic conditions of the countries they invest in.
PROBLEM FORMULATION
________________________________________
Marketing Research being a logical process definitely follows our
predetermined sequence or steps in order to obtain the desired
results or outcomes. Though the entire process of Marketing
Research is quite complex and requires a considerable degree of
knowledge and skill, the step of the Problem Formulation is the
most challenging and critical one for the researcher as well as the
research. It is rightly said that a problem, well defined is half
solved.

In today’s competitive world companies can not afford to

reactive, instead the trend is toward proactive. It is due to the
increasing competition that the companies can not afford to
undertake research until something goes wrong. This can curtail
the future growth or even affect the very existence of the
organization seeing to the trend of being proactive in the future;
companies are allocating more resources to the disciplines of
research. In such case it becomes a duty of researcher to ensure
that the organization gets an optimum return on the resources it
has invested. Thus, Problem Formulation assumes great
importance in Marketing Research.

The Marketing Research project undertaken by me for the ‘Karvy

Securities Limited’ encompasses within its scope, the study of
“The Mutual Fund and to find out market potential of KARVY
Investor Service Ltd. with special reference to distribution of
Mutual Fund in Aligarh City. Company wants to increase it’s sub-
brokers who can work as intermediary between company and the
investors.”

OBJECTIVES
________________________________________

Any activity done without an objective in a mind cannot turn

fruitful. An objective provides a specific direction to an activity.
Objectives may range from very general to very specific, but they
should be clear enough to point out with reasonable accuracy
what researcher wants to achieve through the study and how it
will be helpful to the decision maker in solving the problem.

The objective of any research is basically divided into two

categories.

Primary Objective:

To map market potential of Karvy Investor Service Ltd.

Secondary Objectives:

Following are secondary objectives.

To assess an awareness of mutual funds in Aligarh City.

To find out level of awareness of mutual funds in Aligarh City.
To find out how many investment advisors are interested in
dealing of mutual fund.
To find out how many investment advisors are willing to work
with Karvy.
To do SWOT analysis.

RESEARCH METHODOLOGY
________________________________________

1. Research Design:

A research design is a pattern or an outline of a research project’s

working. It is a statement of only the essential elements of a
study, those that provide the basic guidelines for the details of
the project. It comprises a series of prior decision that taken
together provide master plans for executing a research projects.

A research design serves as a bridge between what has been

established i.e., the research objectives and what is to be done,
in conduct of the study to relish those objectives. If there were no
research design, the research would have only foggy notions as
about what is to be done.

I have used ‘Cross-Sectional Research ’ of ‘Exploratory Research

’. The research is of both qualitative as well as quantitative type.

2. Unit of Analysis:

Mutual Fund Advisors.

Characteristics of interest:

Advisor’s knowledge about Mutual Fund

Advisor’s knowledge about Karvy
Advisor’s interest in getting knowledge of Mutual Fund
Advisor’s willingness to deal in Mutual Fund with Karvy
Advisor’s preference in selecting tax saving instrument of
investment
Advisor’s preference in selecting dealer

3. Sources of Data:

a. Primary Source:

The primary data is collected using sampling method and by

survey using questionnaire.

b. Secondary Source:

Secondary data includes information regarding present market

scenario, Information regarding Mutual Funds and competitors
are collected by Internet, Magazines and News papers and books.
4. Sample Planning:

Sample Size: 50 units

Sample Extent: Aligarh City

Sampling Design:

A Sample Design is a definite plan for obtaining a sample from a

given population. It refers to the technique or method the
researcher would adopt in selecting items for the sample.

I have used both ‘Convenience Sampling Method’

5. Data Collection Method:

I have used ‘Survey Method’ to collect data. I have collected data

using questionnaire.

Questionnaire Plan

I have used ‘Structured Questionnaire’ for gathering the required

data through contacting respondent personally.

Type of Information:

I have collected Fact, Awareness, Attitude, Future action plan and

reason using questionnaire.
Type of Questions:

‘Close-ended questions’ or ‘Dichotomous’ and ‘Multiple Choice’

type are asked in the questionnaire for data collection.
6. Data Analysis & Interpretation:

Data Analysis is based on the data collected by way of

Questionnaires. From the collected data findings are extracted.
The data is tabulated and frequency distribution chart is
prepared.

FINDINGS
________________________________________

After getting in depth research study of Karvy, I came to know

that Karvy is not much popular as other brands operating in
Aligarh city. Bajaj Allianz, HDFC, ICICI are having much higher
tapped market in respect to mutual funds.
• Karvy as an investment option in Mutual Fund does not posses
much proficiency and potential customers in Aligarh city. Though
the financial advisors advise their clients to go for Mutual Fund as
a investment option. About 42% of advisors advise their clients to
invest in Mutual Funds, followed by investing in Insurance sector.

• The advisors after having a deep thought says that it is the

Returns that make them convince their clients to go for
investment in mutual funds. 36% of advisors said that it is the
Returns which make a person to invest in Mutual Fund. Followed
by Risk which is quite lesser in other investment options.

• A huge lott of advisors showed a positive response in dealing of

for Mutual Fund. About 60% of them said that they are interested
in dealing for Mutual Funds, because that results in higher
brokerage.

• As far as Karvy is concerned about 91% of the advisors said

that they are not aware of the services provided by Karvy,
including Mutual Fund.

• When asked, 53% of advisors said that they are not interested
to work with Karvy Securities, to the contrary with they don’t
have any such expansion plans and they have little knowledge
anout Karvy.

• In Aligarh city advisors don’t have an appropriate knowledge

about Karvy as a Investment hub.
SWOT ANALYSIS OF KARVY
________________________________________

Strengths:

Employees are highly empowered.

Strong Communication Network.
Good co-operation between employees.
Number 1 Registrar and Transfer agent in India.
Number 1 dealer of Investment Products in India.

Weaknesses:

High Employee Turnover.

Opportunity:

Growth rate of mutual fund industry is 40 to 50% during last year

and it expected that this rate will be maintained in future also.
Marketing at rural and semi-urban areas.

Threats:

Increasing number of local players.

Past image of Mutual Fund.

LIMITATIONS
________________________________________

Due to limitation of time and cost constrains a sample size of only

50 respondents was chosen.

Data Analysis and interpretation done may not be that strong due
to small sample and ‘Convenience Sampling Method’.

The sample extent for research is only Aligarh City.

Some of the respondents may be biased in giving responses.

My inexperience in research area might have affected results.

CONCLUSION
________________________________________

Mutual Fund Advisors give emphasis on mutual funds than other

investment options.

Mutual Funds have given a new direction to the flow of personal

saving and enable small and medium investors in remote rural
and semi urban areas to reap the benefits of the stock market
investment. Indian Mutual Funds are thus playing a very
important developmental role in allocation of scares resources in
the emerging economy.

Karvy is not able to provide sufficient services to the investors

due to unawareness among advisors regarding services.
The awareness level of investor is low in advisors are interested
in dealing in mutual fund.

Very less advisors are knowing about services provided by karvy.

RECOMMENDATIONS
________________________________________

There is high potential market for Mutual Fund Advisors in Aligarh

city, but this market needs to be explored as investors are still
hesitated to invest their money in Mutual Funds.

In Aligarh investors have inadequate knowledge about Mutual

Funds, So proper Marketing of various schemes is required,
company should arranges more and more seminars on Mutual
Funds.

Awareness of MF services provided by Karvy is also very low so

company needs proper marketing of their all services by
advertising, distribution of pamphlet, arranging seminars etc.

Most of advisors are not interested in dealing of Mutual Funds

because they don’t want to expand their services due to lack of
time, so company should provide them knowledge about single
window services by which investor can get all financial services
from one place.

Company should also provide knowledge about the growth rate

and the expected growth rate of Mutual Fund industry in India.

Most of people aware of life insurance, NSC and PPF for tax
saving so, company should market various tax saving schemes of
Mutual Funds and their benefits.

The interface among the investors and the Mutual Fund

Companies is the agents, so the agents should have proper
knowledge about Mutual Funds as well as market so that they can
help investors in their investment decisions. The quality of agents
performance and investors trust on them can be improved only if
they are permanent in nature.

QUESTIONNAIRE
________________________________________
We assure you that all the information that will be collected from
you will remain fully confidential and it is used for study purpose
only.

1. As a financial investment adviser which investment options you

suggest to your customers?

Shares Mutual Fund

Insurance Fixed Deposit
Tax Bond PPF

2. Please indicate reason for choosing above.

Returns Risk
Safety Tax Benefits
Timely Brokerage

3. Approximately how many customers you have?

4. What is the brokerage Payment Period?
5. Expected Brokerage Payment Period
6. If a service person who pays Income Tax wants to invest,
generally which option do you suggest for investment?

Insurance
Mutual Funds
PPF
Tax Bond
Fixed Deposits

8. Are you interested to deal in MF?

Yes
No
If No Why?

9. Do you know about MF services provided by Karvy’s Aligarh

Branch?

Yes
No

10. In future will you attend seminar arranged by Karvy to guide

investors about MF?
Yes
No

11. Would you like to work with Karvy Securities Ltd for dealing
in mutual fund?
Yes
No
11.1 If no, then the reason would be:

Not answered
No time
Lack of knowledge
No expansion plans

BIBLIOGRAPHY
________________________________________

1. www.mutualfundsindia.com
2. www.amfiindia.com
3. www.themanagementor.com
4. www.dewb-vc.com
5. www.karvy.com
6. www.indiacorporateadvisor.com
7. www.nsdl.co.in
8. www.incometaxdelhi.nic.in
9. www.incometaxindia.gov.in
10. David J. Luck & Ronald S. Rubin, “Marketing Research”,
Ed. – 7 (ISBN)
11. D.C.Anjaria & Dhaivat Anjaria, “AMFI Workbook”, Ed. – 2
(Association of Mutual Funds in India)