A

PROJRCT REPORT
ON
MUTUAL FUND DISTRUBUTION & SALES IN INDIA
AT
GLOBAL MULTI SERVICES

SUBMITTED TO
Savitribai Phule Pune University

IN PARTIAL FUFILMENT OF
MASTER OF BUSINESS MANAGEMENT
YEAR 2019-2020

Rajuli Siddhesh Ghodke

Project Guide
Mrs. Renu M Thakur

Gokhale Education Society’s

J D C Bytco Institute of Management Studies & Research, Nashik-5

 Acknowledgement

Before we get into thick of things, I would like to add a few words of
appreciation for the people who have been a part of this project right from
its inception. The writing of this project has been one of the significant academic
challenges I have faced and without the support, patience, and guidance of the people
involved, this task would not have been completed. It is to them I owe my deepest
gratitude.
It gives me immense pleasure in presenting this project report on "Mutual Fund". It has
been my privilege to have a team of project guide who have assisted me from
the commencement of this project. The success of this project is a result of sheer hard
work, and determination put in by me with the help of my project guide. I hereby take

this opportunity to add a special note of thanks for Mrs. Renu Thakur,
who undertook to act as my mentor despite her many other academic and professional
commitments. Her wisdom, knowledge, and commitment to the highest standards
inspired and motivated me. without her insight, support, and energy, this project wouldn’t
have kick-started and neither would have reached fruitfulness.
I also feel heartiest sense of obligation to my library staff members 3 seniors, who helped
me in collection of data resource material also in its processing as well as in drafting
manuscript. The project is dedicated to all those people, who helped me while doing this
project.
 Declaration

I hereby declare that this Project Report entitled “Mutual fund in INDIA”
Submitted in the partial fulfilment of the requirement of Master of Business Administration of
J D C BYTCO INSTITUTE OF MANAGEMENT STUDIES & RESEARCH, NASHIK
Based on primary and secondary data found by me in various departments, books, magazines
and website & collected by me in under guidance of Mr. Santosh Tajne.

Date:- Rajuli S. Ghodke

MBA II Year
 Executive Summary

A mutual fund is a scheme in which several people invest their money for a
Common financial cause. The collected money invests in the capital market and the money,
which they earned, is divided based on the number of units, which they hold.
The mutual fund industry started in India in a small way with the UTI act creating what
was effectively a small savings division within the RBI. Over a period of 25 years this grew
fairly successfully and gave investors a good return, and therefore in 1989, as the next logical
step , public sector banks and financial institutions were allowed to float mutual funds and their
success emboldened the government to allow the private sector to foray into this area.
The advantages of mutual fund are professional management, diversification, economies of
scale, simplicity, and liquidity .
The disadvantages of mutual fund are high costs, over-diversification, possible tax
consequences, and the inability of management to guarantee a superior return.
The biggest problems with mutual funds are their costs and fees it include purchase
fee, Redemption fee, Echange fee, Management fee, Account fee 3 Transaction costs. There
are some loads which add to the cost of mutual fund. Load is a type of commission depending
on the type of funds .
Mutual funds are easy to buy and sell. You can either buy them directly from the fund
company or through a third party. Before investing in any funds one should consider some
factor like objective, risk, fund Manager’s and scheme track record, cost factor etc.
There are many, many types of mutual funds. You can classify funds based Structure?
( open - ended & close-ended), Nature ( equity, debt, balanced), Investment objective
(growth, income, money market) etc.
A code of conduct and registration structure for mutual fund intermediaries, which
were subsequently mandated by SEBI. In addition, this year AMFI was involved in a
number of developments and enhancements to the regulatory framework.
 The most important trend in the mutual fund industry is the aggressive expansion
of the foreign owned mutual fund companies and the decline of the companies floated by
nationalised banks and smaller private sector players.
Reliance Mutual Fund, UTI Mutual Fund, ICICI Prudential Mutual Fund, HDFC
Mutual Fund and Birla sun life Mutual Fund are the top five mutual fund company in India.
Reliance mutual funding is considered to be most reliable mutual funds in India. People
want to invest in this institution because they know that this institution will never dissatisfy
them at any cost. You should always keep this into your mind that if particular mutual funding
scheme is on larger scale then next time, you might not get the same results so being a careful
investor you should take your major step diligently otherwise you will be unable to obtain the
high returns.
Chapter :-1 Introduction to the topic
 Mutual Fund
A mutual fund is a professionally managed investment fund that pools money from
many investors to purchase securities. These investors may be retail or institutional in nature.
Mutual funds have advantages and disadvantages compared to direct investing in
individual securities. The primary advantages of mutual funds are that they provide economies
of scale, a higher level of diversification, they provide liquidity, and they are managed by
professional investors. On the negative side, investors in a mutual fund must pay various fees
and expenses.
Primary structures of mutual funds include open-end funds, unit investment trusts,
and closed-end funds .Exchange-traded funds (ETFs) are open-end funds or unit investment
trusts that trade on an exchange. Some close- ended funds also resemble exchange traded funds
as they are traded on stock exchanges to improve their liquidity. Mutual funds are also classified
by their principal investments as money market funds, bond or fixed income funds, stock or
equity funds, hybrid funds or other. Funds may also be categorized as index funds, which are
passively managed funds that match the performance of an index, or actively managed funds.
Hedge funds are not mutual funds; hedge funds cannot be sold to the general public as
they require huge investments. They are more risky than mutual funds and are subject to
different government regulations.

What Is a Mutual Fund?

A mutual fund is a type of financial vehicle made up of a pool of money collected from
many investors to invest in securities such as stocks, bonds, money market instruments, and
other assets. Mutual funds are operated by professional money managers, who allocate the
fund's assets and attempt to produce capital gains or income for the fund's investors. A mutual
fund's portfolio is structured and maintained to match the investment objectives stated in its
prospectus.

Mutual funds give small or individual investors access to professionally managed

portfolios of equities, bonds and other securities. Each shareholder, therefore, participates
proportionally in the gains or losses of the fund. Mutual funds invest in a vast number of
securities, and performance is usually tracked as the change in the total market cap of the fund
derived by the aggregating performance of the underlying investments.

The Basics of a Mutual Fund

Mutual funds pool money from the investing public and use that money to buy other
securities, usually stocks and bonds. The value of the mutual fund company depends on the
performance of the securities it decides to buy. So, when you buy a unit or share of a mutual
fund, you are buying the performance of its portfolio or more precisely, a part of the portfolio's
value.

Investing in a share of a mutual fund is different from investing in shares of stock. Unlike
stock, mutual fund shares do not give its holders any voting rights. A share of a mutual fund
represents investments in many different stocks (or other securities) instead of just one holding.
 That's why the price of a mutual fund share is referred to as the net asset value (NAV) per
share, sometimes expressed as NAVPS. A fund's NAV is derived by dividing the total value of
the securities in the portfolio by the total amount of shares outstanding. Outstanding shares are
those held by all shareholders, institutional investors, and company officers or insiders. Mutual
fund shares can typically be purchased or redeemed as needed at the fund's current NAV,
which—unlike a stock price—doesn't fluctuate during market hours, but is settled at the end of
each trading day.

The average mutual fund holds hundreds of different securities, which means mutual fund
shareholders gain important diversification at a low price. Consider an investor who buys only
Google stock before the company has a bad quarter. He stands to lose a great deal of value
because all of his dollars are tied to one company. On the other hand, a different investor may
buy shares of a mutual fund that happens to own some Google stock. When Google has a bad
quarter, she only loses a fraction as much because Google is just a small part of the fund's
portfolio.

KEY TAKEAWAYS

 A mutual fund is a type of investment vehicle consisting of a portfolio of stocks, bonds

or other securities.
 Mutual funds give small or individual investors access to diversified, professionally
managed portfolios at a low price.
 Mutual funds are divided into several kinds of categories, representing the kinds of
securities they invest in, their investment objectives, and the type of returns they seek.
 Mutual funds charge annual fees (called expense ratios) and, in some cases,
commissions, which can affect their overall returns.
 The overwhelming majority of money in employer-sponsored retirement plans goes into
mutual funds.

How Mutual Funds Work

A mutual fund is both an investment and an actual company. This dual nature may seem
strange, but it is no different from how a share of AAPL is a representation of Apple, Inc. When
an investor buys Apple stock, he is buying part ownership of the company and its assets.
Similarly, a mutual fund investor is buying part ownership of the mutual fund company and its
assets. The difference is that Apple is in the business of making smartphones and tablets, while a
mutual fund company is in the business of making investments.

Investors typically earn a return from a mutual fund in three ways:

1. Income is earned from dividends on stocks and interest on bonds held in the fund’s
portfolio. A fund pays out nearly all of the income it receives over the year to fund
owners in the form of a distribution. Funds often give investors a choice either to receive
a check for distributions or to reinvest the earnings and get more shares
2. If the fund sells securities that have increased in price, the fund has a capital gain. Most
funds also pass on these gains to investors in a distribution.
3. If fund holdings increase in price but are not sold by the fund manager, the fund's shares
increase in price. You can then sell your mutual fund shares for a profit in the market.
Types of Mutual Funds
Mutual funds are divided into several kinds of categories, representing the kinds of
securities they have targeted for their portfolios and the type of returns they seek. There is a
fund for nearly every type of investor or investment approach. Other common types of mutual
funds include money market funds, sector funds, alternative funds, smart-beta funds, target-date
funds, and even funds-of-funds, or mutual funds that buy shares of other mutual funds.

 Equity Funds

The largest category is that of equity or stock funds. As the name implies, this sort of fund
invests principally in stocks. Within this group is various sub-categories. Some equity funds are
named for the size of the companies they invest in small-, mid- or large-cap. Others are named
by their investment approach: aggressive growth, income-oriented, value, and others. Equity
funds are also categorized by whether they invest in domestic (U.S.) stocks or foreign equities.
There are so many different types of equity funds because there are many different types of
equities. A great way to understand the universe of equity funds is to use a style box, an
example of which is below.

The idea here is to classify funds based on both the size of the companies invested in
(their market caps) and the growth prospects of the invested stocks. The term value fund refers
to a style of investing that looks for high quality, low growth companies that are out of favour
with the market. These companies are characterized by low price-to-earnings (P/E), low price-
to-book (P/B) ratios, and high dividend yields. On the other side of the style, spectrum
are growth funds, which look to companies that have had (and are expected to have) strong
growth in earnings, sales, and cash flows. These companies typically have high P/E ratios and
do not pay dividends. A compromise between strict value and growth investment is a “blend,”
which simply refers to companies that are neither value nor growth stocks and are classified as
being somewhere in the middle.

 Fixed-Income Funds
 Another big group is the fixed income category. A fixed income mutual fund focuses on
investments that pay a set rate of return, such as government bonds, corporate bonds, or other
debt instruments. The idea is that the fund portfolio generates interest income, which then passes
on to shareholders.

Sometimes referred to as bond funds, these funds are often actively managed and seek to
buy relatively undervalued bonds in order to sell them at a profit. These mutual funds are likely
to pay higher returns than certificates of deposit and money market investments, but bond funds
aren't without risk. Because there are many different types of bonds, bond funds can vary
dramatically depending on where they invest. For example, a fund specializing in high-yield
junk bonds is much riskier than a fund that invests in government securities. Furthermore, nearly
all bond funds are subject to interest rate risk, which means that if rates go up the value of the
fund goes down.

 Index Funds

Another group, which has become extremely popular in the last few years, falls under the
moniker "index funds." Their investment strategy is based on the belief that it is very hard, and
often expensive, to try to beat the market consistently. So, the index fund manager buys stocks
that correspond with a major market index such as the S&P 500 or the Dow Jones Industrial
Average (DJIA). This strategy requires less research from analysts and advisors, so there are
fewer expenses to eat up returns before they are passed on to shareholders. These funds are often
designed with cost-sensitive investors in mind.

 Balanced Funds

Balanced funds invest in both stocks and bonds to reduce the risk of exposure to one
asset class or another. Another name for this type of mutual fund is "asset allocation fund." An
investor may expect to find the allocation of these funds among asset classes relatively
unchanging, though it will differ among funds. This fund's goal is asset appreciation with lower
risk. However, these funds carry the same risk and can be as subject to fluctuation as other
classifications of funds.

A similar type of fund is known as an asset allocation fund. Objectives are similar to those of a
balanced fund, but these kinds of funds typically do not have to hold a specified percentage of
any asset class. The portfolio manager is therefore given freedom to switch the ratio of asset
classes as the economy moves through the business cycle.

 Money Market Funds

The money market consists of safe (risk-free) short-term debt instruments, mostly
government Treasury bills. This is a safe place to park your money. You won't get substantial
returns, but you won't have to worry about losing your principal. A typical return is a little more
than the amount you would earn in a regular checking or savings account and a little less than
the average certificate of deposit (CD). While money market funds invest in ultra-safe assets,
during the 2008 financial crisis, some money market funds did experience losses after the share
price of these funds, typically pegged at $1, fell below that level and broke the buck.
  Income Funds

Income funds are named for their purpose: to provide current income on a steady basis.
These funds invest primarily in government and high-quality corporate debt, holding these
bonds until maturity in order to provide interest streams. While fund holdings may appreciate in
value, the primary objective of these funds is to provide steady cash flow to investors. As such,
the audience for these funds consists of conservative investors and retirees. Because they
produce regular income, tax-conscious investors may want to avoid these funds.

 Global/International Funds

An international fund (or foreign fund) invests only in assets located outside your home
country. Global funds, meanwhile, can invest anywhere around the world, including within your
home country. It's tough to classify these funds as either riskier or safer than domestic
investments, but they have tended to be more volatile and have a unique country and political
risks. On the flip side, they can, as part of a well-balanced portfolio, actually reduce risk by
increasing diversification since the returns in foreign countries may be uncorrelated with returns
at home. Although the world's economies are becoming more interrelated, it is still likely that
another economy somewhere is outperforming the economy of your home country.

 Specialty Funds

This classification of mutual funds is more of an all-encompassing category that consists

of funds that have proved to be popular but don't necessarily belong to the more rigid categories
we've described so far. These types of mutual funds forgo broad diversification to concentrate
on a certain segment of the economy or a targeted strategy. Sector funds are targeted strategy
funds aimed at specific sectors of the economy such as financial, technology, health, and so on.
Sector funds can, therefore, be extremely volatile since the stocks in a given sector tend to be
highly correlated with each other. There is a greater possibility for large gains, but also a sector
may collapse (for example the financial sector in 2008 and 2009).

Regional funds make it easier to focus on a specific geographic area of the world. This
can mean focusing on a broader region (say Latin America) or an individual country (for
example, only Brazil). An advantage of these funds is that they make it easier to buy stock in
foreign countries, which can otherwise be difficult and expensive. Just like for sector funds, you
have to accept the high risk of loss, which occurs if the region goes into a bad recession.

Socially-responsible funds (or ethical funds) invest only in companies that meet the
criteria of certain guidelines or beliefs. For example, some socially responsible funds do not
invest in “sin” industries such as tobacco, alcoholic beverages, weapons or nuclear power. The
idea is to get competitive performance while still maintaining a healthy conscience. Other such
funds invest primarily in green technology such as solar and wind power or recycling.

 Exchange Traded Funds (ETFs)

A twist on the mutual fund is the exchange traded fund (ETF). These ever more popular
investment vehicles pool investments and employ strategies consistent with mutual funds, but
they are structured as investment trusts that are traded on stock exchanges and have the added
benefits of the features of stocks. For example, ETFs can be bought and sold at any point
throughout the trading day. ETFs can also be sold short or purchased on margin. ETFs also
typically carry lower fees than the equivalent mutual fund. Many ETFs also benefit from
active options markets where investors can hedge or leverage their positions. ETFs also enjoy
tax advantages from mutual funds. The popularity of ETFs speaks to their versatility and
convenience.

Advantages of Mutual Funds

There are a variety of reasons that mutual funds have been the retail investor's vehicle of
choice for decades. The overwhelming majority of money in employer-sponsored retirement
plans goes into mutual funds.

 Diversification

Diversification, or the mixing of investments and assets within a portfolio to reduce risk,
is one of the advantages of investing in mutual funds. Experts advocate diversification as a way
of enhancing portfolio return while reducing its risk. Buying individual company stocks and
offsetting them with industrial sector stocks, for example, offers some diversification. However,
a truly diversified portfolio has securities with different capitalizations and industries and bonds
with varying maturities and issuers. Buying a mutual fund can achieve diversification cheaper
and faster than by buying individual securities. Large mutual funds typically own hundreds of
different stocks in many different industries. It wouldn't be practical for an investor to build this
kind of a portfolio with a small amount of money.

 Easy Access

Trading on the major stock exchanges, mutual funds can be bought and sold with relative
ease, making them highly liquid investments. Also, when it comes to certain types of assets, like
foreign equities or exotic commodities, mutual funds are often the most feasible way—in fact,
sometimes the only way—for individual investors to participate.

 Economies of Scale

Mutual funds also provide economies of scale. Buying one spares the investor of the
numerous commission charges needed to create a diversified portfolio. Buying only one security
at a time leads to large transaction fees, which will eat up a good chunk of the investment. Also,
the $100 to $200 an individual investor might be able to afford is usually not enough to buy a
round lot of the stock, but it will purchase many mutual fund shares. The smaller denominations
of mutual funds allow investors to take advantage of dollar cost averaging.

 Professional Management

A primary advantage of mutual funds is not having to pick stocks and manage
investments. Instead, a professional investment manager takes care of all of this using careful
research and skill full trading. Investors purchase funds because they often do not have the time
or the expertise to manage their own portfolios, or they don’t have access to the same kind of
information that a professional fund has. A mutual fund is a relatively inexpensive way for a
small investor to get a full-time manager to make and monitor investments. Most private, non-
institutional money managers deal only with high-net-worth individuals—people with at least
six figures to invest. However, mutual funds, as noted above, require much lower investment
minimums. So, these funds provide a low-cost way for individual investors to experience and
hopefully benefit from professional money management.

 Economies of Scale

Because a mutual fund buys and sells large amounts of securities at a time,
its transaction costs are lower than what an individual would pay for securities transactions.
Moreover, a mutual fund, since it pools money from many smaller investors can invest in
certain assets or take larger positions than a smaller investor could. For example, the fund may
have access to IPO placements or certain structured products only available to institutional
investors.

 Variety and Freedom of Choice

Investors have the freedom to research and select from managers with a variety of styles
and management goals. For instance, a fund manager may focus on value investing, growth
investing, developed markets, emerging markets, income or macroeconomic investing, among
many other styles. One manager may also oversee funds that employ several different
styles. This variety allows investors to gain exposure to not only stocks and bonds but
also commodities, foreign assets, and real estate through specialized mutual funds. Some mutual
funds are even structured to profit from a falling market (known as bear funds). Mutual funds
provide opportunities for foreign and domestic investment that may not otherwise be directly
accessible to ordinary investors.

Disadvantages of Mutual Funds

Liquidity, diversification, and professional management, all these factors make

mutual funds attractive options for a younger, novice, and other individual investors who
don't want to actively manage their money. However, no asset is perfect, and mutual
funds have drawbacks too.

 Fluctuating Returns

Like many other investments without a guaranteed return, there is always the possibility
that the value of your mutual fund will depreciate. Equity mutual funds experience price
fluctuations, along with the stocks that make up the fund. The Federal Deposit Insurance
Corporation (FDIC) does not back up mutual fund investments, and there is no guarantee of
performance with any fund. Of course, almost every investment carries risk. It is especially
important for investors in money market funds to know that, unlike their bank counterparts,
these will not be insured by the FDIC.
  Cash Drag

Mutual funds pool money from thousands of investors, so every day people are putting
money into the fund as well as withdrawing it. To maintain the capacity to accommodate
withdrawals funds typically have to keep a large portion of their portfolios in cash. Having
ample cash is excellent for liquidity, but money is sitting around as cash and not working for
you and thus is not very advantageous. Mutual funds require a significant amount of their
portfolios to be held in cash in order to satisfy share redemptions each day. To
maintain liquidity and the capacity to accommodate withdrawals, funds typically have to keep a
larger portion of their portfolio as cash than a typical investor might. Because cash earns no
return, it is often referred to as a “cash drag.”

 High Costs

Mutual funds provide investors with professional management, but it comes at a cost—
those expense ratios mentioned earlier. These fees reduce the fund's overall payout, and they're
assessed to mutual fund investors regardless of the performance of the fund. As you can
imagine, in years when the fund doesn't make money, these fees only magnify losses. Creating,
distributing, and running a mutual fund is an expensive undertaking. Everything from the
portfolio manager's salary to the investors' quarterly statements cost money. Those expenses are
passed on to the investors. Since fees vary widely from fund to fund, failing to pay attention to
the fees can have negative long-term consequences. Actively managed funds incur transaction
costs that accumulate over each year. Remember, every dollar spent on fees is a dollar that is not
invested to grow over time.

 'Diworsification' and Dilution

'Diworsification '—a play on words—is an investment or portfolio strategy that implies too
much complexity can lead to worse results. Many mutual fund investors tend to overcomplicate
matters. That is, they acquire too many funds that are highly related and, as a result, don't get the
risk-reducing benefits of diversification. These investors may have made their portfolio more
exposed; a syndrome called diworsification. At the other extreme, just because you own mutual
funds doesn't mean you are automatically diversified. For example, a fund that invests only in a
particular industry sector or region is still relatively risky.

In other words, it's possible to have poor returns due to too much diversification. Because
mutual funds can have small holdings in 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 growing too big. When new money pours into funds that have had strong track
records, the manager often has trouble finding suitable investments for all the new capital to be
put to good use.

One thing that can lead to diworsification is the fact that a fund's purpose or makeup isn't always
clear. Fund advertisements can guide investors down the wrong path. The Securities and
Exchange Commission (SEC) requires that funds have at least 80% of assets in the particular
type of investment implied in their names. How the remaining assets are invested is up to the
fund manager. However, the different categories that qualify for the required 80% of the assets
may be vague and wide-ranging. A fund can, therefore, manipulate prospective investors via its
title. A fund that focuses narrowly on Congolese stocks, for example, could be sold with a far-
ranging title "International High-Tech Fund."

 Active Fund Management

Many investors debate whether or not the 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 gets paid. Actively managed funds incur higher fees, but increasingly
passive index funds have gained popularity. These funds track an index such as the S&P
500 and are much less costly to hold. Actively managed funds over several time periods have
failed to outperform their benchmark indices, especially after accounting for taxes and fees.

 Lack of Liquidity

A mutual fund allows you to request that your shares be converted into cash at any time,
however, unlike stock that trades throughout the day, many mutual fund redemptions take place
only at the end of each trading day.

 Taxes

When a fund manager sells a security, a capital-gains tax is triggered. Investors who are
concerned about the impact of taxes need to keep those concerns in mind when investing in
mutual funds. Taxes can be mitigated by investing in tax-sensitive funds or by holding non-tax
sensitive mutual fund in a tax-deferredaccount, such as a 401(k) or IRA.

 Evaluating Funds

Researching and comparing funds can be difficult. Unlike stocks, mutual funds do not
offer investors the opportunity to juxtapose the price to earnings (P/E) ratio, sales
growth, earnings per share (EPS), or other important data. A mutual fund's net asset value can
offer some basis for comparison, but given the diversity of portfolios, comparing the proverbial
apples to apples can be difficult, even among funds with similar names or stated objectives.
Only index funds tracking the same markets tend to be genuinely comparable.
Chapter :-2 Industry Profile
 History
A mutual fund is a trust or a pool of investments by investors who share a common

financial goal. This pool is invested in several financial instruments such as shares, debt

instruments, bonds etc. by the company managing that trust. This company is called an Asset

Management Company. Returns so generated are later distributed among the members of the

pool in the ratio of their investments. The AMC invests its money in a manner that while the

returns are maximized, the risks are kept to a minimum level. In India, it is mandatory for every

Asset Management Firm to be registered with the Securities and Exchange Board of India

(SEBI), a body that regulates all securities instruments.

The first company that dealt in mutual funds was the Unit Trust of India. It was set up in

1963 as a joint venture of the Reserve Bank of India and the Government of India. The objective

of the UTI was to guide small and uninformed investors who wanted to buy shares and other

financial products in larger firms. The UTI was a monopoly in those days. One of its mutual

fund products that ran for several years was the Unit Scheme 1964.

 First Phase - 1964-1987

Unit Trust of India (UTI) was established in 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, 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.
The graph indicates the growth of assets over the years.
 List Of Mutual Companies In India

 ICICI Prudential Equity & Debt Fund

 SBI Mutual Fund
 RELIANCE Mutual Fund
 AXIS Mutual Fund
 UTI Mutual Fund
 HDFC Mutual Fund
 BIRLA Sun Life Mutual Fund
 TATA Mutual Fund
 KOTAK Mutual Fund
 SBI Mutual Fund
 Motilal Oswal Mutual Fund
 J.P. Morgan Asset Management Mutual Fund
 Sundaram Mutual Fund
Chapter :-3 Company Profile