WINTER INTERNSHIP

REPORT

To Study the Customer/investor behavioral analysis towards investment

done at

Latin Manharlal Securities Pvt. Ltd.,Mumbai

by

Shreya singh

MBA18D51

under the guidance of

Jahnavi Surpur

Sr. Business Manager

Winter Internship Report, Pune Institute of Business Management, Pune

ACKNOWLEDGMENT

The internship opportunity I had with Latin Manharlal Securities Pvt. Ltd., Mumbai was a
great chance for learning and professional development. Therefore, I consider myself as a very
lucky individual as I was provided with an opportunity to be a part of it. I am also grateful for
having a chance to meet so many wonderful people and professionals who led me though this
internship period.

Bearing in mind previous I am using this opportunity to express my deepest gratitude and special
thanks to the MD of Company Mr. Bhavin Shah who in spite of being extraordinarily busy with
his duties, took time out to hear, guide and keep me on the correct path and allowing me to carry
out my project at their esteemed organization and extending during the training.

I express my deepest thanks to Mr. Saurabh Bhushan [Head of Wealth] for taking part in useful
decision & giving necessary advices and guidance and arranged all facilities to make life easier. I
choose this moment to acknowledge his contribution gratefully.

It is my radiant sentiment to place on record my best regards, deepest sense of gratitude to

Mrs.Jahnavi Surpur[Sr.Business Manager],for their careful and precious guidance which were
extremely valuable for my study both theoretically and practically.

I perceive as this opportunity as a big milestone in my career development. I will strive to use
gained skills and knowledge in the best possible way, and I will continue to work on their
improvement, in order to attain desired career objectives. Hope to continue cooperation with all of
you in thefuture.

Sincerely,

Name Surname: Shreya singh

Place:Mumbai
Date:

2
Winter Internship Report, Pune Institute of Business Management, Pune

COMPANY CERTIFICATE

3
Winter Internship Report, Pune Institute of Business Management, Pune

Contents
ACKNOWLEDGMENT 2
COMPANY CERTIFICATE 3
1. PROJECT SYNOPSIS 5
2. ABOUT THE SECTOR 6
3. ABOUT THE COMPANY & DEPARTMENT 7
4. INTERNSHIP SUMMARY 8
5. PROJECT DESCRIPTION 9
6. LEARNING/ FINDING 10
7. SUGGESTION (IF ANY) 11
8. REFERENCES 12

4
Winter Internship Report, Pune Institute of Business Management, Pune

1. PROJECT SYNOPSIS

Project Title Financial Services Marketing Activity

Company Name Latin Manharlal Securities’ Pvt. Ltd.

Student Name Shreya Singh

Student Roll No MBA18B37

Project Guide Name Jahnavi Surpur

Project Guide Designation Sr. Business Manager

Confidential Report (Yes/No) No

Duration of project 1 Month

 The term investment means conversion of cash or money into a monetary asset or a claim
on future money for a return.
 The major features of an investment are safety of principal amount, liquidity, income
stability, appreciation and easy transferability.
 A variety of investment avenues are available such as shares, bank, companies, gold and
silver, real estate, life insurance, postal savings and so on.
 This project is carried out to know customer’s/investor’s perception towards various
investment options available.
 In this project a survey was conducted for a period of one month in Andheri (W) and
Thane(W).
 In Andheri(W) there were various types of firms like manufacturing firms, consultants, IT
companies, Travel Agencies, Third Party vendors, etc.
 The survey was carried among the employees who are currently working in respective
firms.
 In this survey we got an opportunity to meet Directors, Head HRs, Senior Business
Managers, Assistant Engineers of various firms.
 We got to know their views on investments and their current investment pattern.
 Thane(W) is one of the big market to explore as the area is dominated by only one
“Financial service provider” i.e.Sharekhan.
 There are certain market places in that area namely Makhmali Road, Jambhli Naka,
Goakhle Road, Ram-Maruti Road, Naupada, 3-Petrol Pump on which we mainly focused.

5
Winter Internship Report, Pune Institute of Business Management, Pune

 The Investor Awareness Survey was carried out among the shop owners, vendors,
retailers, medical shop owners, traders, wholesalers, Street-Shop Owners.
 Vendors do have a mindset that invest only in raw material process it sells it and get the
profit within short period of time.
 In the whole survey we met over 200+ customers/investors from various background
having different income slab and different pattern of investment.

6
Winter Internship Report, Pune Institute of Business Management, Pune

2. ABOUT THE SECTOR

Banking, Financial Services and insurance

Introduction
Banking, financial services and insurance (BFSI) is an industry term for companies that provide
a range of such financial products/services, such as universal banks. India has a diversified
financial sector undergoing rapid expansion, both in terms of strong growth of existing financial
services firms and new entities entering the market. The sector comprises commercial banks,
insurance companies, non-banking financial companies, co-operatives, pension funds, mutual
funds and other smaller financial entities. The banking regulator has allowed new entities such as
payments banks to be created recently thereby adding to the types of entities operating in the sector.
However, the financial sector in India is predominantly a banking sector with commercial banks
accounting for more than 64 per cent of the total assets held by the financial system.

The Government of India has introduced several reforms to liberalise, regulate and enhance this
industry. The Government and Reserve Bank of India (RBI) have taken various measures to
facilitate easy access to finance for Micro, Small and Medium Enterprises (MSMEs). These
measures include launching Credit Guarantee Fund Scheme for Micro and Small Enterprises,
issuing guideline to banks regarding collateral requirements and setting up a Micro Units
Development and Refinance Agency (MUDRA). With a combined push by both government and
private sector, India is undoubtedly one of the world's most vibrant capital markets. In 2017, a new
portal named 'Udyami Mitra' has been launched by the Small Industries Development Bank of
India (SIDBI) with the aim of improving credit availability to Micro, Small and Medium
Enterprises' (MSMEs) in the country. India has scored a perfect 10 in protecting shareholders'
rights on the back of reforms implemented by Securities and Exchange Board of India (SEBI).

Market Size
The Mutual Fund (MF) industry in India has seen rapid growth in Assets Under Management
(AUM). Total AUM of the industry stood at Rs.24.03 trillion (US$ 342.01 billion) between April-
November 2018. At the same time the number of Mutual fund (MF) equity portfolios reached a
high of 74.6 million as of June 2018.
Another crucial component of India’s financial industry is the insurance industry. The insurance
industry has been expanding at a fast pace. The total first year premium of life insurance companies
reached Rs 193,866.23 crore (US$ 30.10 billion) during FY18.
Along with the secondary market, the market for Initial Public Offers (IPOs) has also witnessed
rapid expansion. The total amount of Initial Public Offerings (IPO) increased to US$ 1.2 billion
raised from 37 between April – June 2018.

7
Winter Internship Report, Pune Institute of Business Management, Pune

Over the past few years India has witnessed a huge increase in Mergers and Acquisition (M&A)
activity. In H12018, 74 deals of acquisition took place in financial sector. The total value of such
transactions was US$ 4.166 billion. *
Furthermore, India’s leading bourse Bombay Stock Exchange (BSE) will set up a joint venture
with Ebix Inc. to build a robust insurance distribution network in the country through a new
distribution exchange platform.

Government Initiatives
● In December, 2018, Securities and Exchange Board of India (SEBI) proposed direct
overseas listing of Indian companies and other regulatory changes.
● Bombay Stock Exchange (BSE) introduced weekly futures and options contracts on Sensex
50 index from October 26, 2018.
● In September 2018, SEBI asked for recommendations to strengthen rules which will
enhance the overall governance standards for issuers, intermediaries or infrastructure
providers in the financial market.
● The Government of India launched India Post Payments Bank (IPPB), to provide every
district with one branch which will help increase rural penetration. As of August 2018, two
branches out of 650 branches are already operational.

Road Ahead
● India is today one of the most vibrant global economies, on the back of robust banking and
insurance sectors. The relaxation of foreign investment rules has received a positive
response from the insurance sector, with many companies announcing plans to increase
their stakes in joint ventures with Indian companies. Over the coming quarters there could
be a series of joint venture deals between global insurance giants and local players.
● The Association of Mutual Funds in India (AMFI) is targeting nearly five-fold growth in
assets under management (AUM) to Rs.95 lakh crore (US$ 1.47 trillion) and a more than
three times growth in investor accounts to 130 million by 2025.
● India's mobile wallet industry is estimated to grow at a Compound Annual Growth Rate
(CAGR) of 150 per cent to reach US$ 4.4 billion by 2022 while mobile wallet transactions
to touch Rs.32 trillion (USD $ 492.6 billion) by 2022.
Exchange Rate Used: INR 1 = US$ 0.0142 as of Q2 FY19.

8
Winter Internship Report, Pune Institute of Business Management, Pune

3. ABOUT THE COMPANY

Latin Manharlal Securities pvt. Ltd Mumbai

Latin Manharlal Group, incorporated in

1989, offers financial services in India and
has become synonymous with reliability and
trust. For us, safeguarding the interest of our
investors is the uppermost concern. Therefore, our aim is to simplify the investment process by
offering 360-degree view on financial planning that suit the goals and needs of our clients.

Often referred to as among the ‘best investment advisors in India’, Latin Manharlal Group, is has
been serving a diverse customer base comprising retail and institutional investors. The company
has accumulated rich experience in capital markets and provides a wide portfolio of savings and
investment solutions.

Latin Manharlal Group has six business verticals offering different products and financial services
across various asset classes, all under one umbrella. Be it stocks, derivatives, mutual fund, IPOs,
fixed deposits, risk management services, bonds, currency derivatives or PMS Distribution, we
have products for every investment need of our clients.

We serve more than 40,000 clients through a multichannel route – comprising a countrywide
network of over 200 channel partners.

Vision: The vision is to “We ensure wealth maximization while minimizing risks”.

9
Winter Internship Report, Pune Institute of Business Management, Pune

A snapshot of the financial performance of the company during the last 10 years (2007-17)

● Net revenues: Rs 34,487 crores (FY17)

● EBITDA : Rs 6,047 crores (FY17)
● EPS : Rs 20.75 (FY17)
● Cash from operations: Rs 6,500+ crores
● The gross sales have grown at a CAGR of 12.57%
● The Operating profit margin has grown at 13.54%.
● Net profit margin growth is 11.7%
● The average percentage of Return on Capital Employed (ROCE) is 96.5%
● Market Capitalization (FY17) is 1,96,902 crores

150.00%

100.00%

50.00%

0.00%
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
-50.00%

Gross sales 11.3% 11.8% 11.8%2

11.6% 11.5% 10.6% 11.4%
12.4% 12.3% 12.0%

Highlights

● On any given day, nine out of ten Indian households use HUL’s products to feel good or look good
● HUL Brands are used by 2 billion people everyday
● By 2020, Unilever will help more than a billion people take action to improve their health and
well-being.
● By 2020, Unilever will enhance the livelihoods of millions of people as it grows its business.
● By 2030, Unilever’s goal is to halve the environmental footprint of the making and use of its
products as it grows its business.

10
Winter Internship Report, Pune Institute of Business Management, Pune

History

● In late 1880s, the era of FMCG began in India

● The 1990s witnessed a string of crucial mergers, acquisitions and alliances on the Foods and
Beverages front after the liberalization of the Indian economy
● HUL launched a slew of new business initiatives in the early part of 2000’s out of which some of
them are in the rural sector.
● In 2012 HUL’s state of the art Learning Centre and the Customer Insight & Innovation Centre (CiiC)
was inaugurated at the Hindustan Unilever campus at Andheri, Mumbai.
● HUL completed 80 years of corporate existence in India on October 17th, 2013

11
Winter Internship Report, Pune Institute of Business Management, Pune

Organization Chart:

Mr. Latin Manharlal Shah

(Founder)

Mr. Bhavin Shah

(Director)

Mr. Ankit Dalal Mr. Latin Manharlal Shah

(Head HR) (FOUNDER)

12
Winter Internship Report, Pune Institute of Business Management, Pune

13
Winter Internship Report, Pune Institute of Business Management, Pune

4. INTERNSHIP SUMMARY

Internship Work Summary:

Week 1:

● In the first phase we have learnt about various financial products and services that
company offers like Mutual Funds, ELSS, NCDs, Insurance, PMS, Commodity
Trading, Currency Derivative and equity.
● Also had a brief session on Mutual Funds and the points that we have learnt are
1. What is Mutual Fund?
2. Benefits of investing in mutual fund over other financial products/services?
3. Types of Mutual funds.
4. What is SIP?
5. How to invest in mutual fund?
● Learned product pitching skills from Mr. Bhavin Shah(Director)and Mr.Saurabh
Bhushan (Head of Wealth).
● Interacted with Various Customers/Investors who are currently Directors , HRs and
employees regarding their current investments and future plans about investments.

Week 2:
● For the deeper and updated knowledge about mutual funds our director asked us to
attend training program organized by “SBI MUTUAL FUNDS” which was
conducted by Mr. Prakash Ranjan Sinha (Consultant, Trainer on Investment,
Equity, Wealth management, Mutual Fund, Financial & Retirement Planning, Sales
& business Development).
● The learnings from the session are-
1. Capital Gains
2. Offer Document
3. Asset Management Company(AMC)
4. Accounting Valuation & Taxation
5. Time Stamping
6. Fundamental & Technical Analysis
7. Risk involved in equity funds and depth funds
8. Financial and Physical assets
9. Strategic and Tactic Allocation
10. Sharp Ratio
11. Treynor Ratio

14
Winter Internship Report, Pune Institute of Business Management, Pune

12. Drivers of risk in mutual fund schemes

13. ASBA
● AS per allotted task, conducted and successfully completed “Investment
Awareness Survey” .
● A Session was conducted by Komal Raghani(Relationship Manager)on NCDs,
Various Tax Slabs and Calculation of tax, Deduction under 80C, Debentures and
types of debentures, DEMAT account, Asset classes and Fund houses.

Week 3:
● Go to societies and fill the forms of survey . on 9th day I received six visiting cards
from different peoples .
● Interacted with Assistant Aviation officer and the staff of organization.
● In the interaction we got to know about his current investments and plans for the
future investments, with the staff also we had the same discussion .In that
discussion we got to know that all employees do have traditional investments like
provident fund and FDs .so, Told him about awareness program which L.M
Securities conduct to aware the prospect customers and investors about latest
investment schemes and products and convinced him to give us an opportunity to
conducted the program for company employees.

Week 4:

● In this week I covered area Hinjewadi pune, Baner, bhavdhan, FC Road,

Magarpatta city .
● I studied about marketing mix of the company and got some knowledge about
competitors in the market.
● I met over 200+ investors/customers having various businesses like Wholesale
business, Trading Business, Street Shops, Grocery Stores and asked about their
investments weather they are investing in any kind of securities like government
or non-government
● I also did cold calling from the collected data.

15
Winter Internship Report, Pune Institute of Business Management, Pune

5. INTRODUCTION ABOUT MUTUAL FUND

What is a Mutual fund?

Mutual fund is an investment company that pools money from shareholders and invests in a variety
of securities, such as stocks, bonds and money market instruments. Most open-end Mutual funds
stand ready to buy back (redeem) its shares at their current net asset value, which depends on the
total market value of the fund's investment portfolio at the time of redemption. Most open-end
Mutual funds continuously offer new shares to investors. Also known as an open-end investment
company, to differentiate it from a closed-end investment company. Mutual funds invest pooled
cash of many investors to meet the fund's stated investment objective. Mutual funds stand ready
to sell and redeem their shares at any time at the fund's current net asset value: total fund assets
divided by shares outstanding.

16
Winter Internship Report, Pune Institute of Business Management, Pune

CONCEPT OF THE 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 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. The flow chart below describes
broadly the working of a mutual fund:

Why Select Mutual Fund?

The risk return trade-off indicates that if investor is willing to take higher risk then correspondingly
he can expect higher returns and vice versa if he pertains to lower risk instruments, which would
be satisfied by lower returns. For example, if an investors opt for bank FD, which provide moderate
return with minimal risk. But as he moves ahead to invest in capital protected funds and the profit-
bonds that give out more return which is slightly higher as compared to the bank deposits but the
risk involved also increases in the same proportion. Thus investors choose mutual funds as their
primary means of investing, as Mutual funds provide professional management, diversification,
convenience and liquidity. That doesn’t mean mutual fund investments risk free. This is because
the money that is pooled in are not invested only in debts funds which are less riskier but are also
invested in the stock markets which involves a higher risk but can expect higher returns. Hedge
fund involves a very high risk since it is mostly traded in the derivatives market which is
considered very volatile.

17
Winter Internship Report, Pune Institute of Business Management, Pune

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 July1993.

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.

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 421scheme with the provisions of the Indian Trusts Act, 1882 by the Sponsor.

18
Winter Internship Report, Pune Institute of Business Management, Pune

THE WAY & TYPE TO INVEST IN MUTUAL FUND

Mutual funds normally come out with an advertisement in newspapers publishing the date
of launch of the new schemes. Investors can also contact the agents and distributors of mutual
funds who are spread all over the country for necessary information and application forms. Forms
can be deposited with mutual funds through the agents and distributors who provide such services.
Now days, the post offices and banks also distribute the units of mutual funds. However, the
investors may please note that the mutual funds schemes being marketed by banks and post offices
should not be taken as their own schemes and no assurance of returns is given by them. The only
role of banks and post offices is to help in. distribution of mutual funds schemes to the investors.
Investors should not be carried away by commission/gifts given by agents/distributors for
investing in a particular scheme. On the other hand, they must consider the track record of the
mutual fund and should take objective decision.

● ONE TIME INVESTMENT

The amount that has to be invested in onetime is known as Onetime Investment. The
investor has to pay the whole amount at once. The minimum amount is Rs.5000 and
maximum is as per the investors Choice. This investment is generally preferred for the
business man who is able to pay at one time.

● SYSTEMATIC INVESTMENT PLAN (SIP)

The amount that has to be invested through same monthly installment is known as
Systematic Investment Plan. The investor has to pay the minimum amount
Rs.1000monthly for all equity and balanced schemes like that for 6months. And Rs.500
monthly for Tax Saver scheme like that for 12 months. The minimum amount that the
investor has to invest is Rs6000 and maximum as per their choice. This type of investment
is generally preferred for the salaried people.

Who can invest?

Who can invest in Mutual Funds in India: First of all, distributors need to be aware of who mutual
fund units. Mutual funds in India are open to investment by

1. Residents including:

19
Winter Internship Report, Pune Institute of Business Management, Pune

a. Resident Indian Individuals.

b. Indian Companies/Partnership Firms.
c. Indian Trust/Charitable Institutions
d. Banks/Financial Institutions.
e. Non-Banking Finance Companies.
f. Insurance Companies.
g. Provident funds.
h. Mutual funds.

2. Non-Residents including:

a. Non-Resident Indians, and Persons of Indian Origin.

b. Overseas Corporate Bodies (OCBs) and3) Foreign entities, viz.
c. Foreign Institutional Investors(FII) registered with SEBI.
d. Foreign citizens/ entities are not allowed to invest in mutual funds in India.

TYPES OF MUTUAL FUND SCHEMES:

20
Winter Internship Report, Pune Institute of Business Management, Pune

A).BY STRUCTURE

1. Open - Ended Schemes:

An open-end fund is one that is available for subscription all through the year. These do not have
a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value("NAV") related
prices. The key feature of open-end schemes is liquidity.

2. Close - Ended Schemes:

A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15years. The
fund is open for subscription only during a specified period. Investors can invest in the scheme at
the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the
stock exchanges where they are listed. In order to provide an exit route to the investors, some
close-ended funds give an option of selling back the units to the Mutual Fund through periodic
repurchase at NAV related prices. SEBI Regulations stipulate that at least one of the two exit routes
is provided to the investor.

3. Interval Schemes:

Interval Schemes are that scheme, which combines the features of open-ended and close-ended
schemes. The units may be traded on the stock exchange or may be open for sale or redemption
during pre-determined intervals at NAV related prices.

B).BY NATURE

1. Equity Fund:

These funds invest a maximum part of their corpus into equities holdings. The structure of the fund
may vary different for different schemes and the fund manager’s outlook on different stocks. The
Equity Funds are sub-classified depending upon their investment objective, as follows:

•Diversified Equity Funds

•Mid-Cap Funds

•Sector Specific Funds

•Tax Savings Funds (ELSS)Equity investments are meant for a longer time horizon, thus
Equity funds rank high on the risk-return matrix.

2. Debt Funds:

21
Winter Internship Report, Pune Institute of Business Management, Pune

The objective of these Funds is to invest in debt papers. Government authorities, private
companies, banks and financial institutions are some of the major issuers of debt papers. By
investing in debt instruments, these funds ensure low risk and provide stable income to the
investors. Debt funds are further classified as:

● Gilt Funds: Invest their corpus in securities issued by Government, popularly known as
Government of India debt papers. These Funds carry zero Default risk but are associated
with Interest Rate risk. These schemes are safer as they invest in papers backed by
Government.
● Income Funds: Invest a major portion into various debt instruments such as bonds,
corporate debentures and Government securities.
● MIPs: Invests maximum of their total corpus in debt instruments while they take minimum
exposure in equities. It gets benefit of both equity and debt market. These scheme ranks
slightly high on the risk-return matrix when compared with other debt schemes.
● Short Term Plans (STPs): Meant for investment horizon for three to six months. These
funds primarily invest in short term papers like Certificate of Deposits (CDs) and
Commercial Papers (CPs). Some portion of the corpus is also invested in corporate
debentures.
● Liquid Funds: Also known as Money Market Schemes, These funds provides easy
liquidity and preservation of capital. These schemes invest in short-term instruments like
Treasury Bills, inter-bank call money market, CPs and CDs. These funds are meant for
short-term cash management of corporate houses and are meant for an investment horizon
of 1day to 3 months. These schemes rank low on risk-return matrix and are considered to
be the safest amongst all categories of mutual funds.

3. Balanced Funds:

As the name suggest they, are a mix of both equity and debt funds. They invest in both equities
and fixed income securities, which are in line with pre-defined investment objective of the scheme.
These schemes aim to provide investors with the best of both the worlds. Equity part provides
growth and the debt part provides stability in returns.

Further the mutual funds can be broadly classified on the basis of investment parameter viz, Each
category of funds is backed by an investment philosophy, which is pre-defined in the objectives
of the fund. The investor can align his own investment needs with the funds objective and invest
accordingly.

C).BY INVESTMENT OBJECTIVE:

1. Growth Schemes:

22
Winter Internship Report, Pune Institute of Business Management, Pune

Growth Schemes are also known as equity schemes. The aim of these schemes is to provide capital
appreciation over medium to long term. These schemes normally invest a major part of their fund
in equities and are willing to bear short-term decline in value for possible future appreciation.

2. Income Schemes:

Income Schemes are also known as debt schemes. The aim of these schemes is to provide regular
and steady income to investors. These schemes generally invest in fixed income securities such as
bonds and corporate debentures. Capital appreciation in such schemes may be limited.

3. Balanced Schemes:

Balanced Schemes aim to provide both growth and income by periodically distributing a part of
the income and capital gains they earn. These schemes invest in both shares and fixed income
securities, in the proportion indicated in their offer documents (normally 50:50).

4. Money Market Schemes:

Money Market Schemes aim to provide easy liquidity, preservation of capital and moderate
income. These schemes generally invest in safer, short-term instruments, such as treasury bills,
certificates of deposit, commercial paper and inter-bank call money.

● Load Funds: A Load Fund is one that charges a commission for entry or exit. That is, each
time you buy or sell units in the fund, a commission will be payable. Typically entry and
exit loads range from 1% to 2%. It could be worth paying the load, if the fund has a good
performance history.
● No-Load Funds: A No-Load Fund is one that does not charge a commission for entry or
exit. That is, no commission is payable on purchase or sale of units in the fund. The
advantage of a no load fund is that the entire corpus is put to work.
D). OTHER SCHEMES

1. Tax Saving Schemes:

Tax-saving schemes offer tax rebates to the investors under tax laws prescribed from time to time.
Under Sec.88 of the Income Tax Act, contributions made to any Equity Linked Savings Scheme
(ELSS) are eligible for rebate.

2. Index Schemes:

Index schemes attempt to replicate the performance of a particular index such as the BSE Sensex
or the NSE 50. The portfolio of these schemes will consist of only those stocks that constitute the
index. The percentage of each stock to the total holding will be identical to the stocks index
weightage. And hence, the returns from such schemes would be more or less equivalent to those
of the Index.

23
Winter Internship Report, Pune Institute of Business Management, Pune

3. Sector Specific Schemes:

These are the funds/schemes which invest in the securities of only those sectors or industries as
specified in the offer documents. e.g. Pharmaceuticals, Software, Fast Moving Consumer
Goods(FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the
performance of the respective sectors/industries. While these funds may give higher returns, they
are more risky compared to diversified funds. Investors need to keep a watch on the performance
of those sectors/industries and must exit at an appropriate time.

24
Winter Internship Report, Pune Institute of Business Management, Pune

MUTUAL FUND FEES AND EXPENSES

Mutual fund fees and expenses are charges that may be incurred by investors who hold mutual
funds. Running a mutual fund involves costs, including shareholder transaction costs, investment
advisory fees, and marketing and distribution expenses. Funds pass along these costs to investors
in a number of ways.

1.TRANSACTION FEES

a. Purchase Fee: It is a type of fee that some funds charge their shareholders when they buy
shares. Unlike a front-end sales load, a purchase fee is paid to the fund (not to a broker)
and is typically imposed to defray some of the fund's costs associated with the purchase.
b. Redemption Fee: It is another type of fee that some funds charge their shareholders when
they sell or redeem shares. Unlike a deferred sales load, a redemption fee is paid to the
fund (not to a broker) and is typically used to defray fund costs associated with a
shareholder's redemption.
c. Exchange Fee: Exchange fee that some funds impose on shareholders if they exchange
(transfer)to another fund within the same fund group or "family of funds."

2.PERIODIC FEES

a. Management Fee: Management fees are fees that are paid out of fund assets to the fund's
investment adviser for investment portfolio management, any other management fees
payable to the fund's investment adviser or its affiliates, and administrative fees payable to
the investment adviser that are not included in the "Other Expenses" category. They are
also called maintenance fees.
b. Account Fee: Account fees are fees that some funds separately impose on investors in
connection with the maintenance of their accounts. For example, some funds impose an
account maintenance fee on accounts whose value is less than a certain dollar amount.

3.OTHER OPERATING EXPENSES

25
Winter Internship Report, Pune Institute of Business Management, Pune

a. Transaction Costs: These costs are incurred in the trading of the fund's assets. Funds with
a high turnover ratio, or investing in illiquid or exotic markets usually face higher
transaction costs. Unlike the Total Expense Ratio these costs are usually not reported.

LOADS:

Definition of a load

Load funds exhibit a "Sales Load" with a percentage charge levied on purchase or sale of shares.
A load is a type of Commission (remuneration). Depending on the type of load a mutual fund
exhibits, charges may be incurred at time of purchase, time of sale, or a mix of both. The different
types of loads are outlined below.

a. Front-end load: Also known as Sales Charge, this is a fee paid when shares are purchased.
Also known as a "front-end load," this fee typically goes to the brokers that sell the fund's
shares. Front-end loads reduce the amount of your investment. For example, let's say you
have Rs. 10,000 and want to invest it in a mutual fund with a 5% front-end load. The Rs.500
sales load you must pay comes off the top, and the remaining Rs.9500 will be invested in
the fund. According to NASD rules, a front-end load cannot be higher than 8.5% of your
investment.
b. Back-end load: Also known as Deferred Sales Charge, this is a fee paid when shares are
sold. Also known as a "back-end load," this fee typically goes to the brokers that sell the
fund's shares. The amount of this type of load will depend on how long the investor holds
his or her shares and typically decreases to zero if the investor holds his or her shares long
enough.
c. Level load / Low load: It's similar to a back-end load in that no sales charges are paid
when buying the fund. Instead a back-end load may be charged if the shares purchased are
sold within a given timeframe. The distinction between level loads and low loads as
opposed to back-end loads, is that this time frame where charges are levied is shorter.
d. No-load Fund: As the name implies, this means that the fund does not charge any type of
sales load. But, as outlined above, not every type of shareholder fee is a "sales load." A no-
load fund may charge fees that are not sales loads, such as purchase fees, redemption fees,
exchange fees, and account fees.

26
Winter Internship Report, Pune Institute of Business Management, Pune

SELECTION PARAMETERS FOR MUTUAL FUND:

i. Your objective: The first point to note before investing in a fund is to find out whether
your objective matches with the scheme. It is necessary, as any conflict would directly
affect your prospective returns. Similarly, you should pick schemes that meet your specific
needs. Examples: pension plans, children’s plans, sector-specific schemes, etc.
ii. Your risk capacity and capability: This dictates the choice of schemes. Those with no
risk tolerance should go for debt schemes, as they are relatively safer. Aggressive investors
can go for equity investments. Investors that are even more aggressive can try schemes that
invest in specific industry or sectors.
iii. Fund Manager’s and scheme track record: Since you are giving your hard earned money
to someone to manage it, it is imperative that he manages it well. It is also essential that
the fund house you choose has excellent track record. It also should be professional and
maintain high transparency in operations. Look at the performance of the scheme against
relevant market benchmarks and its competitors. Look at the performance of a longer
period, as it will give you how the scheme fared in different market conditions.
iv. Cost factor: Though the AMC fee is regulated, you should look at the expense ratio of the
fund before investing. This is because the money is deducted from your investments. A
higher entry load or exit load also will eat into your returns. A higher expense ratio can be
justified only by superlative returns. It is very crucial in a debt fund, as it will devour a few
percentages from your modest returns.
Also, Morningstar rates mutual funds. Each year end, many financial publications list the year's
best performing mutual funds. Naturally, very eager investors will rush out to purchase
shares of last year's top performers. That's a big mistake. Remember, changing market
conditions make it rare that last year's top performer repeats that ranking for the current
year. Mutual fund investors would be well advised to consider the fund prospectus, the
fund manager, and the current market conditions. Never rely on last year's top performers.

27
Winter Internship Report, Pune Institute of Business Management, Pune

WHAT IS THE PROCEDURE FOR REGISTERING A MUTUAL FUND WITH SEBI?

An applicant proposing to sponsor a Mutual fund in India must submit an application in Form A
along with a fee of Rs.25, 000. The application is examined and once the sponsor satisfies certain
conditions such as being in the financial services business and possessing positive net worth for
the last five years, having net profit in three out of the last five years and possessing the general
reputation of fairness and integrity in all business transactions, it is required to complete the
remaining formalities for setting up a Mutual fund. These include inter alia, executing the trust
deed and investment management agreement, setting up a trustee company/board of trustees

28
Winter Internship Report, Pune Institute of Business Management, Pune

comprising two-thirds independent trustees, incorporating the asset management company

(AMC), contributing to at least 40% of the net worth of the AMC and appointing a custodian.
Upon satisfying these conditions, the registration certificate is issued subject to the payment of
registration fees of Rs.25.00 lacs for details; seethe SEBI (Mutual funds) Regulations, 1996.

HOW TO REDUCE RISK WHILE INVESTING?

● Any kind of investment we make is subject to risk. In fact, we get return on our investment
purely and solely because at the very beginning we take the risk of parting with our funds,
for getting higher value back at a later date. Partition itself is a risk.
● Well known economist and Nobel Prize recipient William Sharpe tried to segregate the
total risk faced in any kind of investment into two parts -systematic (Systemic)risk and
unsystematic (Unsystematic) risk.
● Systematic risk is that risk which exists in the system. Some of the biggest examples of
systematic risk are inflation, recession, war, political situation etc.
● Inflation erodes returns generated from all investments e.g. If return from fixed deposit is
8 per cent and if inflation is 6 percent, then real rate of return from fixed deposit is reduced
by 6 percent.
● Similarly, if returns generated from equity market is 18 per cent and inflation is still 6per
cent then equity returns will be lesser by the rate of inflation. Since inflation exists in the
system there is no way one can stay away from the risk of inflation.
● Economic cycles, war and political situations have effects on all forms of investments. Also
these exist in the system and there is no way to stay away from them. It is like learning to
walk.
● Anyone who wants to learn to walk has to first fall; you cannot learn to walk without
falling. Similarly, anyone who wants to invest has to first face systematic risk; there can
never make any kind of investment without systematic risk.
● Another form of risk is unsystematic risk. This risk does not exist in the system and hence
is not applicable to all forms of investment. Unsystematic risk is associated with particular
form of investment.
● Suppose we invest in stock market and the market falls, then only our investment inequity
gets affected OR if we have placed a fixed deposit in particular bank and bank goes
bankrupt, then we only lose money placed in that bank.
● While there is no way to keep away from risk, we can always reduce the impact of risk.
Diversification helps in reducing the impact of unsystematic risk. If our investment is
distributed across various asset classes, the impact of unsystematic risk is reduced.
● If we have placed fixed deposit in several banks, then even if one of the banks goes
bankrupt our entire fixed deposit investment is not lost.
● Similarly, if our equity investment is in Tata Motors, HLL, Infosys, adverse news about
Infosys will only impact investment in Infosys, all other stocks will not have any impact.
29
Winter Internship Report, Pune Institute of Business Management, Pune

● To reduce the impact of systematic risk, we should invest regularly. By investing regularly,
we average out the impact of risk.
● Mutual fund, as an investment vehicle gives us benefit of both diversification and
averaging.
● Portfolio of mutual funds consists of multiple securities and hence adverse news about
single security will have nominal impact on overall portfolio.
● By systematically investing in mutual fund we get benefit of rupee cost averaging. Mutual
fund as an investment vehicle helps reduce, both, systematic as well as unsystematic risk.

ADVANTAGES OF MUTUAL FUNDS

Professional Management.

The major advantage of investing in a mutual fund is that you get professional money
manager to manage your investments for a small fee. You can leave the investment
decisions to him and only have to monitor the performance of the fund at regular intervals.

Diversification.

Considered the essential tool in risk management, mutual funds make it possible for even
small investors to diversify their portfolio. A mutual fund can effectively diversify its

30
Winter Internship Report, Pune Institute of Business Management, Pune

portfolio because of the large corpus. However, a small investor cannot have a well-
diversified portfolio because it calls for large investment. For example, a modest portfolio
of 10 bluechip stocks calls for a few a few thousands.

Convenient Administration.

Mutual funds offer tailor-made solutions like systematic investment plans and systematic
withdrawal plans to investors, which is very convenient to investors. Investors also do not
have to worry about investment decisions, they do not have to deal with brokerage or
depository, etc. for buying or selling of securities. Mutual funds also offer specialized
schemes like retirement plans, children’s plans, industry specific schemes, etc. to suit
personal preference of investors. These schemes also help small investors with asset
allocation of their corpus. It also saves a lot of paper work.

Costs Effectiveness.

A small investor will find that the mutual fund route is a cost-effective method (the AMC
fee is normally 2.5%) and it also saves a lot of transaction cost as mutual funds get
concession from brokerages. Also, the investor gets the service of a financial professional
for a very small fee. If he were to seek a financial advisor's help directly, he will end up
paying significantly more for investment advice. Also, he will need to have a sizeable
corpus to offer for investment management to be eligible for an investment advisers
services.

Liquidity.

You can liquidate your investments within 3 to 5 working days (mutual funds dispatch
redemption cheques speedily and also offer direct credit facility into your bank account
i.e. Electronic Clearing Services).

Transparency.

Mutual funds offer daily NAVs of schemes, which help you to monitor your investments
on a regular basis. They also send quarterly newsletters, which give details of the portfolio,
performance of schemes against various benchmarks, etc. They are also well regulated
and SEBI monitors their actions closely.

Tax benefits.

You do not have to pay any taxes on dividends issued by mutual funds. You also have
the advantage of capital gains taxation. Tax-saving schemes and pension schemes give
you the added advantage of benefits under section 88.

Affordability

31
Winter Internship Report, Pune Institute of Business Management, Pune

Mutual funds allow you to invest small sums. For instance, if you want to buy a portfolio
of blue chips of modest size, you should at least have a few lakhs of rupees. A mutual
fund gives you the same portfolio for meager investment of Rs.1,000-5,000. A mutual
fund can do that because it collects money from many people and it has a large corpus.

DISADVANTAGES OF MUTUAL FUNDS.

Professional Management-

Did you notice how we qualified the advantage of professional management with the
word "theoretically"? Many investors debate over whether or not the so-called
professionals are any better than you or I at picking stocks. Management is by no means
infallible, and, even if the fund loses money, the manager still takes his/her cut. We'll
talk about this in detail in a later section.

Costs

Mutual funds don't exist solely to make your life easier--all funds are in it for a profit.
The Mutual fund industry is masterful at burying costs under layers of jargon. These
costs are so complicated that in this tutorial we have devoted an entire section to the
subject.

Dilution

It's possible to have too much diversification (this is explained in our article entitled
"Are You Over-Diversified?"). Because funds have small holdings in so many different
companies, high returns from a few investments often don't make much difference on
the overall return. Dilution is also the result of a successful fund getting too big. When
money pours into funds that have had strong success, the manager often has trouble
finding a good investment for all the new money.

Taxes

When making decisions about your money, fund managers don't consider your personal
tax situation. For example, when a fund manager sells a security, a capital-gain tax is
triggered, which affects how profitable the individual is from the sale. It might have
been more advantageous for the individual to defer the capital gains liability.

32
Winter Internship Report, Pune Institute of Business Management, Pune

Equity funds

If selected in the right manner and in the right proportion, have the ability to play an
important role in achieving most long-term objectives of investors in different
segments. While the selection process becomes much easier if you get advice from
professionals, it is equally important to know certain aspects of equity investing
yourself to do justice to your hard earned money.

5. PROJECT DESCRIPTION

Project Title: The Study of Customer/Investor behavioral analysis towards investments

(L.M. Securities Pvt. Ltd.).

Problem Statement:

The statement of the problem under study is to analyze the investment pattern of
investors/customers and popularity of different products/services for investments. This problem
tries to identify the investors/customers perception and their risk taking ability in investing
different products/services of the market.

Objectives:

● To Study investment pattern of investors/customers.

● To study investment decisions of different social class investors (in terms of age group,
education and income level)

Scope of Study:

With More than 30 years of market presence L.M. Securities offers various financial products
and services. L. M. Securities as a firm wants to enhance and expand by reaching to customers
and providing them profitable offerings. As income and risk factors play a significant role while
selecting a particular financial product/service. So most of the people are not aware of the things
like Where to invest, How to invest, How much to invest and what are the best possible profitable
ways to invest. Thus, L. M. securities takes an initiative to conduct an “Investment awareness

33
Winter Internship Report, Pune Institute of Business Management, Pune

Campaign” based on the data collected through survey which can helps them to grow their
customer base.

Hypothesis:

1. Age and awareness regarding Mutual Fund

Ho=Age of the people have impact on awareness of Mutual Fund.

H1=Age of the people have not impact on awareness of Mutual Fund.

2. Occupation and awareness of Mutual Fund

Ho= Occupation have impact on awareness of mutual Fund

H1= Occupation have not impact on awareness of Mutual Fund

3. Education level and awareness of Mutual Fund

Ho=Education have impact on awareness of Mutual fund

H1=Education have not impact on awareness of Mutual Fund

4. Annual income of people and type of Mutual Fund

Ho=Income of the people have impact on purchase of type of Mutual Fund

H1=Income of the people have impact on purchase of type of Mutual Fund

34
Winter Internship Report, Pune Institute of Business Management, Pune

Methodology

Population:

Since the study is mainly related to know the investments patterns of the investors on
different financial products of the company. Their potentiality of earning income and
reducing risk of the investment community on the products, where each security in the
market has to be analyzed through their earnings over the others.

Type of research:

This is a Descriptive Research where survey method is adopted called as “Investment

awareness Survey” to collect primary information from investors using different scales as
required and the required secondary information for the analysis

Primary Data:

A Questionnaire Schedule was prepared by company and the primary data was collected
through survey method.

Secondary Data:

Company website and customer data base.

Duration of the Study:

The study was carried out for a period of 1 month, from 18th Dec.2018 to 18th Jan 2019.

Sample Size:

The population being large (250 respondents). The survey was carried among 75
respondents most of them are employees of various firms, retail and wholesale shop owners,

35
Winter Internship Report, Pune Institute of Business Management, Pune

manufacturers, owners of start-up companies and few of them are at top managerial
positions like directors, HRs, etc. having different income slabs.

Sampling Procedure:

The sampling procedure followed in this study is “Non-Probability Convenient Sampling”.

Simple-Random procedures are used to select the respondent from the available data base.
The research work was carried out on the basis of ‘Structured Questionnaire’ which was
created and provided by company.

Techniques for data analysis:

The analysis of data collection is completed and presented systematically with the use of
Microsoft excel and MS word. The various tools which were used for presentation are –

● Bar Graphs
● Pie-Charts
● Column Graphs
Limitation:

● The research is confined to a certain part of Mumbai and Pune.

● Sample size is 75 which is very small that is not enough to study the awareness of
consumers of the country.
● As sampling technique is convenient sampling so it may result in personal bias. So perfect
result cannot be achieved.
● The study might also consist of the respondents’ bias answer.
● It take much time to go in different areas and fill up questionnaire so the timings are also
limited to make the Project
● 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 75 Investors, out of these only 35 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.
● Respondents are not sincere and care full to fill up the questionnaire so we cannot find
right solution.

36
 Winter Internship Report, Pune Institute of Business Management, Pune

● In India people are not much careful and educated regarding Investment plan so to do this
type of research is little hard.86

ANALYSIS AND INTERPRETATION OF DATA

● Age distribution of Investors

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

No. of investors

Age Group
INVESTORS INVESTED IN MUTUAL FUNDS

5.6

4.5
4.3

3.5

2.5

1.2

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

Age group of the Investors

According to this chart out of 120 Mutual Fund investors of Dehradoon 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.

37
Winter Internship Report, Pune Institute of Business Management, Pune

Educational Qualification of Investors

Educational Qualification No. of Investors
Graduate/Post Graduate
Under Graduate
Other
Total
➢

EDUCATIONAL QUALIFICATION

11%

25% Graduate/Post Graduate

64% Under Graduate
Other

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

38
Winter Internship Report, Pune Institute of Business Management, Pune

Occupation of Investors
Occupation No. of investors
Service/Job
Business
Student
Others

4.3 4.5

3.5

2.5

Series 1

In occupation group out of 120 investors 71% of the investors are in service/job Dehradoon
are Graduate/Post Graduate, 23% are Under Graduate and 6% are others (under HSC).

39
Winter Internship Report, Pune Institute of Business Management, Pune

40
Winter Internship Report, Pune Institute of Business Management, Pune

Monthly income of Investors

Monthly Income No. of investors
<25 lakhs
25Lakhs-50 lakhs
50lakhs-1 Cr.
>1Cr.

4.5
4.3
4.5

4 3.5
3.5

3 2.5
2.5

1.5

0.5

0
<25lac 25lac-50lac 50lac-1Cr. >1Cr.

Monthly income

41
Winter Internship Report, Pune Institute of Business Management, Pune

Awareness about Mutual Fund and its Operations

Response Yes No

No. of respondents

28%

72%

YES NO

42
Winter Internship Report, Pune Institute of Business Management, Pune

Reason for not invested in Mutual Fund

Reason No. of Respondents

Not Aware

Higher Risk

Not any specific reason

11%

25%

64%

Not aware Higher risk Not any specific reason

43
Winter Internship Report, Pune Institute of Business Management, Pune

Type of financial asset owned

4.5
4
3.5
3
2.5
2
1.5
1
0.5
0

Series 1

44
Winter Internship Report, Pune Institute of Business Management, Pune

6. LEARNING/ FINDING:
● Among all the respondents 63% are aware about Mutual Fund and 37% are not aware about
Mutual Fund.
● From all aware respondents only34 respondents have invest in Mutual Fund.
● There are 70% male and 30% female out of all the respondents and more no. of male are
aware then the female about Mutual Fund.
● Among 18 professionals 13 are aware and 5 are not aware about Mutual fund it shows that
there is more awareness in professionals.
● There are 23 respondents who are under graduate among them 14 are aware and 9 are not
aware about Mutual Fund.
● There are 45 respondents who are graduate among them 30 are aware about Mutual Fund
and 15 are not aware about Mutual Fund.
● More respondents have their annual income between 1 lacks to 3 lacks and from the most
of the people are prefer Reliance Mutual Fund.
● From all the respondents 67% respondents have awareness regarding Mutual Fund through
Bank and less no. of respondents are aware through broker.
● 50% respondents are investing in lump sum and 50% are investing in Systematic
Investment Plan.
● 65% respondents are known about Tax benefit and 35% are not aware about tax benefit.
● 58% respondents like Growth Option and 42% respondents like Dividend Option.
● From all the service provided by company SMS alert is more known by respondents which
is 55%.
● Among all the respondents 33% are satisfied with their investment in Mutual Fund and
24% are extremely satisfied with their investment. Only 8% are extremely dissatisfied with
their investment.

45
Winter Internship Report, Pune Institute of Business Management, Pune

7. SUGGESTION (IF ANY)

● After seeing the whole Data analysis and findings my suggestions for the industry are
shown as below.
● The company should give the knowledge regarding Mutual Fund through various sources
like more advertisement, TV programmers etc. about what itis? How it works? What is its
benefit for us with its advertisement or in programs. Because many people have heard about
it but don’t know what it is?
● The company should also attract the low Income people by showing them the benefits of
the liquidity funds for the short Term to attract them.
● As per survey Bank creates higher awareness so the Mutual Fund companies should more
collaborate with the Banks.
● The company should also attract the customer through different schemes who having
knowledge about the Mutual Funds but not investing in Mutual Funds.
● The company should also make aware the people about the AMFI exam and should
motivate them to be financial adviser to get more business.
● The company should give information regarding Tax benefit to Invest into Mutual Fund.
● The company should organize seminar to give information about Mutual Fund and should
distribute brochures having detail of schemes of Mutual Fund.

46
Winter Internship Report, Pune Institute of Business Management, Pune

CONCLUSION
After making the whole report I am concluding that this project measures the awareness of Mutual
Funds and its service. As Mutual Funds having good options and schemes, so we can grow it with
creating the awareness among the people. It is also good for those who want to make their future
in it. For that the only thing you need is to give time to your money to grow, they will surely give
good returns and the other thing is the knowledge of the all product and schemes. As there is lesser
no. of people investing in the Mutual Fund in comparison of the other instruments of the
investment like L.I.C, post, savings a/c etc. So there is a good chance of its growing. Even Mutual
Fund is also having the product as substitute of it. So the industry can get the benefit of it. The
industry cans aware more investors to invest in Mutual Fund. They can do these through seminars,
advertisement etc. They can also increase their sales by collaborating with many banks. They can
also make more advisors by giving them more commission.

47
Winter Internship Report, Pune Institute of Business Management, Pune

8. REFERENCES

● www.latinmanharlal.com
● www.amfindia.com
● www.moneycontrol.com
● www.google.com
● www.wikipedia.com
● www.sharemaketbasics.com
● www.sharemarket.com

48
Winter Internship Report, Pune Institute of Business Management, Pune

49