Project report:

(Submitted for the Degree of B.com Honours in Accounting and

Finance under the University of Calcutta)

A COMPARATIVE STUDY OF SELECTED

MUTUAL FUNDS IN INDIA

SUBMITTED BY:

Name of the Student: Sahil Nahar

C.U. Registration No: 235-1111-0782-22
C.U. Roll No: 201235-21-0782-22
College Roll No: 685
Shift: Day

Name of the supervisor: Amit Mitra

Name of the College: T. H. K. Jain College
Month of submission: 2025-2026

1
 SUPERVISOR CERTIFICATE

This is to certify that Sahil Nahar, student of B.COM(HONOURS) in Accounting &

Finance of THK JAIN COLLEGE under the university of Calcutta has worked under the
supervision and guidance for his project work and prepared a project report with the title
"A COMPARATIVE STUDY OF SELECTED MUTUAL FUNDS IN INDIA".

The project report, which he has submitted is his genuine and original work to the best of
my knowledge.

Place: Kolkata Signature of the Supervisor

Name: AMIT MITRA

Designation: Professor

College Name: Tara Devi Harakh

Date: Chan Kankaria Jain College

2
 STUDENT DECLARATION

This I hereby declare that the project work with the title "A
Comparative Study of Selected Mutual Funds In India”. Submitted by
me for the partial fulfilment of the degree of B.COM Honours in
Accounting & Finance under the University of Calcutta is my original
work and has not been not submitted earlier to any other university/
institution of the requirement for any course of study.
I also declare that no chapter of this manuscript is whole or in part has
been incorporated in this report from any earlier work done by others
or by me. However, extracts of any literature which has been used in
this report has been duly acknowledged by providing details of such
literature in the references

3
 ACKNOWLEDGMENT

It is a matter of great pleasure to present this project on " A Comparative Study of

Selected Mutual Funds in India. "This project work helped me to gather a lot of
real-world knowledge and experience which would definitely help me in future.
But, this project would be incomplete without thanking our respected Principal
Dr. Mausumi Singh Sengupta and our Department in charge Anjali Ma’am who
gave me this opportunity to work on this field. I am very thankful to my
supervisor Prof. “AMIT Mitra” for her full support in completing this project
work. Finally, I am grateful for the support of my family/friends/ others and
would also like to thank them for co-operating with me to carry out these research
work and help me with the project work by filling up the questionnaire/report.

Sahil Nahar

4
 TABLE OF CONTENTS

CHAPTERS TOPICS PAGE NO

CHAPTER-1 • Background Study 6
INTRODUCTION • Need of study 7
• Literature Review 8
• Objective of the Study 9
• Research and
Methodology 10
11
• Limitations of the study
• Chapter Planning 12

CHAPTER-2 • Concept and meaning of 13

CONCEPTUAL Mutual Funds
FRAME WORK • Advantages of Mutual 15
Funds
• Disadvantages of Mutual 16
Funds
• National Scenario 17
• International Scenario 18

CHAPTER-3 • TOP 5 Small Cap 18

DATA Mutual Funds In INDIA
ANALYSIS AND • Data Analysis of the 19
company
FINDING 31
• Survey Analysis
• Findings 37
• Limitation of the report 38
CHAPTER-4 • Conclusion 39
CONCLUSION AND • Recommendation 40
RECOMMENDATION
CHAPTER-5 • References 41
BIBLIOGRAPHY • Annexure 42

5
 CHAPTER 1
INTRODUCTION
BACKGROUND OF THE STUDY
Post the government strategy of liberalization in the industrial and financial
industry, various financial instruments arose as a result of the government's
industrial and financial sector deregulation agenda. The rising relevance and the
people who are interested to invest MFs shall be demonstrated on stipulations
of rising capital mobilization and an expanding number of schemes and investors
in the sector. Mutual funds must perform as effective institutional investors in
order to meet the expectations of millions of account holders.

Researchers aimed to investigate investors' evolving attitudes regarding mutual

fund investments, as well as their demands and expectations from the various
types of MFs accessible in the sector of India and the ROI perception associated
with mutual fund purchases. Various methodologies were used to identify the key
features that Indian investor evaluate when making investment decisions. Today's
investors are interested in learning more about MFs and how they may be used
as an investment tool.

The Indian financial industry offers investors a variety of options. It has sparked
a surge in the mutual fund industry, which now offers reasonable options for
ordinary people to invest their money.

6
 NEED OF STUDY:

• The main purpose of doing this project was to know about mutual fund and its
functioning. This helps to know in details about mutual fund industry right from its
inception stage, growth and future prospects.

• To study a comparative performance analysis for the selected mutual funds for five
years.

• To analyze the risk and returns of mutual fund schemes.

• To achieve a comprehensive understanding regarding the mutual fund schemes.

7
 LITERATURE REVIEW

A. Hybrid Mutual Funds were studied by Dr. Ashok Khurana and Kavita Panjwani
“

(November 2010). The Arithmetic Mean and CAGR can be used to compare mutual fund
results. Standard Deviation and Beta can be used to assess risk, whereas Risk-Return
Adjustment is used to assess performance. For risk-return analysis, Sharpe and Treynor
ratios are employed. To determine how well a fund performs in comparison to the market,
it is compared to various benchmarking standards, industry average data points and study
of volatility and return on a per unit basis. Value at Risk analysis may be used to
determine the greatest probable losses in a particular month.

B. A Comparative Study on Evaluation of Selected MFs in India was completed by Ms.

“

K. Hema Divya (April 2012). During the latter two decades of the twentieth century, the
mutual fund sector grew by leaps and bounds. Proper fund performance evaluation would
promote peer comparison among investment managers and assist typical investors in
identifying qualified managers. Furthermore, increasing market rivalry drives the
managers of such funds to maintain a high standard of performance in order to please
management and customers. As a result, frequent mutual fund performance review is
critical for both customers and fund managers. The goal of this analysis is to draw a
comparison between the return of MFs to BSE Indices on an annual basis. ”

C. Review and Performance of Select Mutual Funds Operated by P rivate Sector Banks:
“

Axis Equity and Kotak 50 Funds - Growth Option, B. Raja Manner and Dr. B.
Ramachandra Reddy (Oct 2012). The funds are statistically evaluated based on their
association with the benchmark. CNX S&P Sharpe's Index, Nifty, standard deviation are
all examples of ratios.

8
 OBJECTIVES OF THE STUDY

The primary reasons behind studying this topic are:

• To gain insight and comprehension about MFs.

• To know the performance of MFs relative to the current market.

• To evaluate and compare the performance of top performing mutual fund

schemes.

• To compare how the MFs have performed in categories differentiated by

their capitalization in market.

• To study change in returns pattern.

9
 RESEARCH METHODOLOGY
It refers to the methods used to collect, organize, and analyze data during the
research process. It refers to the tools used in a research endeavor to acquire
significant data. Common research methods include surveys, questionnaires, and
interviews. Since research is an academic activity, it should be utilised in a
technical sense.

Data Collection

Primary Data- Not Applicable

Secondary Data- “ In this study, secondary data is utilized as the foundation

for analysis. The top five asset management firms were chosen based on their
AUM asof March 2022. The top five small caps, mid-cap and big cap funds are
chosen based on performance. Various websites were used to acquire dailydata
on the day end NAV of selected Mutual Funds. The NSE SENSEX, the most
prominent and extensively followed index, is regarded as a representative of the
market. The data's period of reference ranges fromMarch 2017 to March 2022.

Data Analysis Tools

Tools used- While making the project various tools has been used. These are:-
• Microsoft Word
• Various analysis tools like Line Graphs, Stock Charts, Tables
• Mutual Fund Beta Ratio
• Annualized and Rolling Returns

10
 LIMITATIONS

• Mutual
Funds of only five years are taken into
account for analyzing the performance.

• The comparative study is restricted to the

selected schemes of asset management
companies.

• The financial market in India is unpredictable

in nature and the future aspects of the mutual
funds may vary.

11
 CHAPTER PLANNING:

This project paper is segmented into three sections to explore the link between
conventional subjective and statistical approach of Mutual Fund analysis. To start
with,
The first section deals with the introductory part of the paper by giving an
overview of the Mutual fund industry and company profile. This section also talks
about the theory of portfolio analysis and the different measures of risk and return
used for the comparison.

The second section details on the need, objective, and the limitations of the study.
It also discusses about the sources and the period for the data collection. It also
deals with the data interpretation and analysis part wherein all the key measures
related to risk and return are done with the interpretation of the results.

In the third section, an attempt is made to analyze and compare the performance
of the small cap mutual fund.
The portfolio analysis of the selected fund has been done by the measure return
for the holding period.

At the end, it illustrates the suggestions and findings based on the analysis done in
the previous sections and finally it deals with conclusion part.

12
 CHAPTER :2
CONCEPTUAL FRAMEWORK

2.1 Concept and Meaning of Mutual Fund

An instrument which aggregates the money from a lot of people who wantto
invest and have similar objectives for making money, infuse it in assets that
meet the schemes declared goals. All Mutual funds are handled by fund
managers, who employ their investment expertise, abilities through
conducting the required analysis, provide a considerably more lucrativegains
than any person could get alone.
Evolution of Mutual Funds

“UTI was established in 1963 with the purpose of getting small investor’s or
retail investor’s to invest in MFs. This was facilitated by the joint venture of
GOI and RBI. The evolution of India’s MF sector can be categorized as follows:

Stage 1. Founding and Rise of Unit Trust of India - 1964-87

“ Initially, UTI had a monopoly in the Indian MF sector. It continued to function

under its regulatory authority until 1978, when the two were de- linked and full
authority was passed to the IDBI. The Unit Scheme of 1964, UTI's inaugural
investment scheme, was introduced in 1964 and drew the biggest highest of
investors of any individual scheme during that time.

Stage II. Public Sector Funds Started - 1987-1993

“Then in 1987, the Indian MF business saw several public sector companies
enter the industry. SBI launched India's first non-UTI MF in 1987. The
industry’s AUM had grown 7 times till 1993, while UTI stayed the most
dominant playerinthe market.” 13
Stage III. The beginning of the Private Sector Funds - 1993-96

Private sector funds, including international fund management organizations (often

“

entering through joint ventures with Indian entrepreneurs), were granted permission to come
into the MF industry in 1993, providing investors with several options. Innovative products,
investing approaches, and investor-servicing technologies were introduced by private funds.
Around 11 private sector funds had established their programmes by 1994- 95.

Stage IV. The start of SEBI Regulations and Growth of MF Industry – 1996- 2004

“Post 1996, the MF industry experienced strong expansion but stronger

oversight from SEBI. As the general public began to get more interested in MFs,
fund mobilization and volume of firms performing in this field touched new
heights.”

“SEBI protected the interests of investors, while the government granted tax
breaks to people who were investing in MFs in order to attract them. SEBI
created the Mutual Funds Regulations, 1996, which established similar
requirements for all mutual funds in India. During this time, SEBI and AMFI
developed a number of Investor Awareness Programs with the goal of educating
and informing the general public about Mutual fund business.”

In 1999, there was a considerable increase in the amount of money raised from
investors and the amount of money under management.”

Stage V. Rise and Unification – 2004 Onwards

“The market saw many MnA’s from 2004 onwards. International players also
entered India around this time. By the end of FY 2006, there were a total of 29
MFs. The industry is still growing, thanks to consolidation and the arrival of
new foreign and private sector firms.

14
 Advantages of Mutual Fund Investment

1. Professional Management: “The person investing in mutual fund can rest assured that
their funds are being handled by a professional investor.
2. Diversification: “Mutual funds are a basket which means that the money in the fund
has been invested in various companies and industries. They are also diversified in terms
of the type of security that it is invested in.
3. Convenient Administration: This means that the person investing in MFs does not
have to go to the bureaucracy of investment and liquidation process.
4. Transparency: The person investing in mutual fund can regularly monitor its
performance through online or offline modes.
5. Flexibility: The person investing in mutual fund can invest his or her money in lump

sum or on a regular basis which is also known as systematic investment plan.

6. Choice of Schemes: “Several distinct funds are managed by many mutual fund
providers, and you can switch between them for little or no cost. This allows you to
adjust the balance of your portfolio when your personal requirements, financial
ambitions, or market conditions change.”
7. Tax Benefits: Certain MF schemes provide investors with the benefit of deducting the
amount deposited from their taxable income. This lowers their taxable income and, as
a result, their tax bill.

15
 Disadvantages of Mutual Fund Investment

1. Fluctuating Returns: “Because MFs cannot promise fixed returns, you should always
be prepared for the worst-case scenario, which includes depreciation in the mutual fund.
To put it another way, mutual funds are subject to a vast range of price changes.
2. No Control: “Fund managers administer every sort of MFs. In various situations, a team
of analysts may aid fund management. As a result, you have no influence over your
money as an investor.

However, you can look into certain key factors including an Asset Management
Company's transparency policies, corpus, and overall investing strategy (AMC).”

3. Costs: “The value of a MF may fluctuate as market conditions change. Additionally,

fees and charges associated with professional MF management, which are not present
when purchasing stocks or assets directly from the market. The salaries of market
analysts and fund managers are mostly funded by investors.
4. Dilution: “One of the most frequently touted benefits of a MF is diversification. Over
diversification, on the other hand, can raise a fund's running costs, necessitate increased
due diligence, and dilute the relative benefits of diversification.”
5. Cash Drag: To fulfil investor redemptions and retain liquidity for purchases, mutual
funds must keep assets in cash. Investors, on the other hand, pay to keep their funds in
cash because annual expenses are charged on all fund assets, whether invested or not

16
 National Scenario

The mutual fund industry added Rs 2.2 lakh crore to its asset base in 2022, driven by consistent
monthly increase in SIP (Systematic Investment Plan) flows. The Assets Under Management
(AUM) of the mutual fund industry rose by 5.7 per cent or Rs 2.2 lakh crore to a total Rs 39.88
lakh crore in 2022, data from the Association of Mutual Fund Industry (Amfi) showed on
Tuesday.

This was way lower than a surge of nearly 22 per cent or an increase of close to Rs 7 lakh crore in
the asset base to Rs 37.72 lakh crore in 2021. "The industry grew at a slower pace in 2022 due to
uncertainty in stock markets, and changing interest rate scenarios affecting the business
environment at large. Understandably, investors have been in step with these changes by
reallocating their investments between equity, debt and hybrid schemes,

The increase in asset base in 2022 is mostly the result of advanced SIP flows, which touched Rs
13,000-crore for the second time in a row in November. Besides, industry body Amfi has played
an important role in driving awareness towards mutual funds among retail investors, Akhil
Chaturvedi, Chief Business Officer of Motilal Ostwal AMC, said.

During the calendar year, SIP inflows averaged more than Rs 12,500 crore per
month, helping investors to stay in the stock market and benefit from Rupee cost
averaging. The steady inflow suggests resilience in domestic inflows, which have
been strong counterbalance to FPIs (Foreign Portfolio Investors) selling.

Further, the current run rate of inflows is expected to continue in 2023 with
monthly SIPs touching around Rs 14,000 crore on an average, Chaturvedi said.

l7
 INTERNATIONAL
SCENARIO
International mutual funds or overseas funds are portfolio of equities, bonds, and money
market securities traded in foreign market. Recently these funds have gained popularity
because of the diversification they offer. They offer many benefits such as taking
advantage of emerging markets, commodities boom, or business cycle of different markets.
Just like domestic funds, international mutual funds offer many varieties such as
commodity-based fund, thematic fund, country based, sector based, and others. Moreover,
these funds are managed by experts in international markets. Many fund houses have
international mutual Funds in their portfolio. RISKS & IMPORTANT POINTS Every
reward comes with the
Associated risk. While international mutual funds open up new avenues for diversification,
they also expose investors to few risk factors. First, international mutual funds invest in
foreign markets and hence most of the investors will
not have any idea about the business environment, changing business scenario, and
regulatory consequences. This can be a major disadvantage, especially for active mutual
fund investors
who keep a keen eye on movements. In case of international mutual funds, they may find
themselves helpless. Moreover, many of these mutual funds are new in nature and hence
may not. have any history of1 returns.
Second, investors may not get enough time to1 react to news which impact mutual funds
and its NAV. There will be a time lag between when the policy decisions are announced in
foreign countries and when it reaches to investors to make right decision. International
funds are also prone to global political situation. While domestic market provides
a better defense against any adverse movement, international politics and business are
more difficult to understand. "here may be possibility that a fund focused in China may be
impacted because of war in Middle East. These events are difficult to predict as well as
impossible to factor in your
investment plan.

18
 CHAPTER-3
DATA ANALYSIS
Small Cap Mutual Funds in India

“ Small-cap mutual funds invest mostly in equities of small businesses with growth
prospects. These stocks have the potential to double or triple in value in a few of years, but
this also means that the return on these funds is highly volatile. When it comes to selecting
equities portfolios, the size of the company is a crucial factor to consider. This is because
the portfolio would have its own set of opportunities and dangers, depending on the size
of the organisation.”
Table 3– Top 5 Small Cap Mutual Funds in India

NAME TYPE DATE NAV as

LAUNCHED on
Mar 31,
2022 (in
Cr)
SBI Small Cap Growth Plan 09-Sep-2009 ₹ 102.33
Fund (Regular)
Quant Small Cap Growth Plan 24-Nov-1996 ₹ 135.3
Fund (Regular)

HDFC Small Cap Growth Plan 03-Apr-2008 ₹ 72.9

Fund (Regular)
Kotak Small Cap Growth Plan 02-Jan-2013 ₹ 163.9

Fund (Regular)
ABSL Small Cap Growth Plan 31-May-2007 ₹ 52

Fund (Regular)

Source – Money control website

19
 SBI Small Cap Fund
SCHEME OBJECTIVE

By infusing primarily in a well-diversified basket of small-cap equities firms, investors

will be able to benefit from long-term capital growth and the liquidity of an open-ended
scheme.

SCHEME DETAILS

Fund manager(s) – R. Srinivasan

Expense ratio – 2.03% (class average is 1.39%)

Benchmark – NIFTY Small cap 100

Type: Open Ended Fund.

Table 3.1- 1-5Y Return by SBI Small Cap Fund

Investment Investment of ₹10000 Current Absolute Yearly Returns Division

Duration NAV Returns Average

YTD 31st Mar’22 10027.30 0.27% --- 0.46%

1 Year 31st Mar’21 12844.30 28.44% 28.44% 29.13 %

2 Year 31st Mar’20 23696.60 19.65% 53.94% 54.77 %

3 Year 31st Mar’19 20490.00 104.90% 26.93% 27.65%

5 Year 31st Mar’18 24624.70 146.25% 19.74% 20.42%

Source – Money control website

The table above gives information on the returns and value of the mutual fund over a
period of 5 years as compared to the average returns given by funds in the small cap
category.

20
 Fig 3.1 Performance of SBI Small Cap Fund for the period of 2017-22

Source – Money Control Website

Inference: The graph depicts the performance of SBI Small Cap Fund for the
period of 2017-22. This mutual fund has consistently performed over the
benchmark index that tracks the performance of companies with small market
capitalization since the 1st quarter of 2017 and has garnered returns 0.68% lower
than the industry average for regular investment type small cap funds for the
investment period of 5 years.

SBI Small Cap Fund Risk Factor

Beta Value = 0.76

Category Average = 0.76

Low Volatility

Here, the Beta value is equal to the category average; this implies that the
stock price tends to move with the market. Thus, it will have a systematic risk.

21
 Quant Small Cap Fund

SCHEME OBJECTIVE

The primary goal is to achieve long-term capital appreciation by infusing primarily in[[[[-//
small- cap equities and equity-related instruments, with a secondary goal of generating
consistent returns by infusing in debt and money market securities.

SCHEME DETAILS

Fund manager(s) – Ankit Pande, Vasav Sahgal, Sanjeev Sharma

Expense ratio – 1.75 % (class average is 1.92%)

Benchmark - Nifty Small cap 100 TRI

Type: Open Ended Fund.

Table 1.2 – 1-5Y Return by Quant Small Cap Fund

Investment Investment Current Absolute Yearly Division

Duration of ₹10000 NAV Returns Returns Average

YTD 31st Mar’22 10027.30 2.27% --- -1.45%

1 Year 31st Mar’21 14138.10 41.38% 41.38% 37.05%

2 Year 31st Mar’20 39521.10 295.21% 98.80% 62.42%

3 Year 31st Mar’19 27296.90 172.97% 39.63% 24.91%

5 Year 31st Mar’18 27604.90 176.05% 22.50% 13.76%

Source – Money control website

The table above gives information on the returns and value of the MF over a period
of 5 years as compared to the average returns given by funds in the small cap category.

22
 Fig 3.2 – Performance of Quant Small Cap Fund for the period of 2017-22

Source – Money Control Website

Inference: The graph depicts the performance of Quant Small Cap Fund for the
period of 2017-22. This mutual fund has gradually improved its performance
since the 1st quarter of 2020 and has garnered returns 8.74% higher than the
industry average for direct investment type small cap funds for the investment
period of 5 years.

Quant Small Cap Fund Risk Factor

Beta Value = 0.39

Category Average = 0.76

Low Volatility

Here, the Beta value is less than the category average; this implies that the
stock is less risky and will likely offer low returns.

Here, the Beta value is less than the category average; this implies that the stock is less
risky and will likely offer low returns.

23
 HDFC Small Cap Fund

SCHEME OBJECTIVE

To provide long-term capital appreciation /income by infusing predominantly

in Small-Cap companies. There is no guarantee that the investment goal of the
Scheme will be realized.

SCHEME DETAILS

Fund manager(s) – Chirag Setalvad

Expense ratio – 1.92% (class average is 1.93%)

Benchmark - Nifty Small cap 100 TRI

Type: Open Ended Fund.

Table 3.3 – 1-5Y Return by HDFC Small Cap Fund

Investment Investment Current Absolute Yearly Division

Duration of ₹10000 NAV Returns Returns Average

YTD 31st Mar’22 9558.10 -4.42% --- - 1.45%

1 Year 31st Mar’21 13276.70 32.77% 32.77% 37.05%

2 Year 31st Mar’20 25664.10 156.64% 60.20% 62.42%

3 Year 31st Mar’19 16734.50 67.34% 18.67% 24.91%

5 Year 31st Mar’18 20285.20 102.85% 15.19% 13.76%

Source – Money control website

The table above gives information on the returns and value of the MF over a
period of 5 years as compared to the average returns given by funds in the small
cap category.

24
 Fig 3.3 – Performance of HDFC Small Cap Fund for the period of 2017-22

Source – Money Control Website

Inference: The graph depicts the performance of HDFC Small Cap Fund for
the period of 2017-22. This mutual fund has consistently performed over the
benchmark index that tracks the performance of companies with small market
capitalization since the 1st quarter of 2018 and has garnered returns 1.43%
lower than the industry average for direct investment type small cap funds for
the investment period of 5 years.

HDFC Small Cap Fund Risk Factor

Beta Value = 0.88

Category Average = 0.76

High Volatility

Here, the Beta value is more than the category average; this implies that the
stock is riskier and will likely offer high returns.

25
 Kotak Small Cap Fund

SCHEME OBJECTIVE

The investment goal of the scheme is to generate capital appreciation from a

diversified portfolio of equity and equity related securities by infusing
predominantly in small cap companies. There is no assurance that the
investment objective of the Scheme will be achieved.

SCHEME DETAILS

Fund manager(s) – Pankaj Tibrewal

Expense ratio – 1.85% (class average is 1.84%)

Benchmark - Nifty Small cap 100 TRI

Type: Open Ended Fund.

Table 3.4. – 1-5Y Return by Kotak Small Cap Fund

Investment Investment Current Absolute Yearly Division

Duration of ₹10000 NAV Returns Returns Average

YTD 31st Mar’22 9789.20 - 2.11% --- - 1.45%

1 Year 31st Mar’21 13362.90 33.63% 33.63% 37.05%

2 Year 31st Mar’20 28619.50 186.19% 69.17% 62.42%

3 Year 31st Mar’19 23093.20 130.93% 32.08% 24.91%

5 Year 31st Mar’18 22547.70 125.48% 17.65% 13.76%

Source – Money control website

The table above gives information on the returns and value of the MF over a period of 5 years
as compared to the average returns given by funds in the small cap category.

26
 Fig 3.4 – Performance of Kotak Small Cap Fund for the period of 2017-22

Source – Money Control Website

Inference: The graph depicts the performance of Kotak Small Cap Fund for the
period of 2017-22. This mutual fund has gradually improved its performance
since the 3rd quarter of 2018 and has garnered returns 3.89% higher than the
industry average for direct investment type small cap funds forthe investment
period of 5 years.

Kotak Small Cap Fund Risk Factor

Beta Value = 0.74

Category Average = 0.76

Low Volatility

Here, the Beta value is less than the category average; this implies that the
stock is less risky and will likely offer low returns.

27
 Aditya Birla Sun Life Small Cap Fund
SCHEME OBJECTIVE

The Scheme seeks to generate consistent long-term capital appreciation by infusing

predominantly in equity and equity related securities of small cap companies.

SCHEME DETAILS

Fund manager(s) – Jayesh Gandhi

Expense ratio – 1.96% (class average is 1.84%)

Benchmark - Nifty Small cap 100 TRI

Type: Open Ended Fund.

Table 3.5 – 1-5Y Return by Aditya Birla Sun Life Small Cap Fund

Investment Investment Current Absolute Yearly Division

Duration of ₹10000 NAV Returns Returns Average

YTD 31st Mar’22 9357.40 - 6.43% --- -1.45%

1 Year 31st Mar’21 11933.70 19.34% 19.34% 37.05%

2 Year 31st Mar’20 23434.50 134.24% 53.08% 62.42%

3 Year 31st Mar’19 15009.90 50.10% 14.45% 24.91%

5 Year 31st Mar’18 13936.20 39.36% 6.86% 13.76%

Source – Money control website

The table above gives information on the returns and value of the MF over a
period of 5 years as compared to the average returns given by funds in the small
cap category.

28
 Fig 3.5 – Performance of ABSL Small Cap Fund for the period of 2017-22

Source – Money Control Website

Inference: The graph depicts the performance of ABSL Small Cap Fund for
the period of 2017-22. This mutual fund has experienced both an upward and
downward trend and thus, has performed similarly to the benchmark index. It
has garnered returns 6.9% lower than the industry average for direct investment
type small cap funds for the investment period of 5 years.

ABSL Small Cap Fund Risk Factor

Beta Value = 0.88

Category Average = 0.76

High Volatility

Here, the Beta value is more than the category average; this implies that the
stock is riskier and will likely offer high returns.

29
 What kind of investors are these funds suitable for?

“This is a fund that makes investments in small businesses. When the market
starts to fall, this fund’s returns will be severely eroded. As a result, you must stay
invested for the long term in order for the fund to achieve the profits you want.
You can expect gains that easily outperform inflation as well as returns from fixed
income choices if you invest for seven years or more. Thus, we can say that these
funds are an excellent investment option for individuals who are willing to take
on greater risk and seek more aggressive development. So, while you might
expect larger long-term returns, you can also expect more severe ups and downs
along the way.

30
 SURVEY ANALYSIS:
TABLE 1: Showing percentage and number of survey respondents under different age group

AGE NUMBER PERCENTAGE

BELOW 18 2 5%
18-25 37 92.5%
25-30 0 0%
ABOVE 30 1 2.5%
TOTAL 40 100%

ABOVE 30 BELOW 18
3% 5%

18-25
92%
BELOW 18 18-25 25-30 ABOVE 30

SOURCE: Filled survey

Interpretation: 92% of the respondents are in the group of 18-25 years.

TABLE 2: Showing percentage on the basis of Gender

GENDER NUMBER PERCENTAGE

MALE 23 57.5%
FEMALE 17 42.5%
PREFER NOT TO SAY 0 0%
TOTAL 40 100%

PREFER NOT TO SAY

0%
FEMALE
43%
MALE
58%

MALE FEMALE PREFER NOT TO SAY

SOURCE: Filled survey

Interpretation: Male respondents (58%) is higher than Female respondents (43%).

31
TABLE 3: Showing QUESTION: 1

Q. According to you, are mutual funds good?

OPTIONS NUMBER PERCENTAGE

YES 30 75%
NO 0 0
MAYBE 7 17.5%
NOT INTERESTED 3 7.5%
TOTAL 40 100%

SOURCE: Filled survey

Interpretation: According to 75% people mutual fund is good and 7.5% are not an investor
and the rest don't know about it.

TABLE 4: Showing QUESTION: 2

Q. What is your source of information while investing in mutual funds?

OPTIONS NUMBER PERCENTAGE

INTERNET 22 55%
MAGAZINE 3 7.5%
FINANCIAL ADVISOR 10 25%
FRIENDS 5 12.5%
TOTAL 40 100%

SOURCE: Filled survey

Interpretation: 55% people know about MF via internet 25% from financial advisor and
restfrommagazine andfromfriends.
32
TABLE 5: Showing QUESTION: 3

Q. Are you a regular or a new investor in mutual fund?

OPTIONS NUMBER PERCENTAGE

REGULAR 10 25%
NEW 6 15%
NOT AN INVESTOR 24 60%
TOTAL 40 100%

SOURCE: Filled survey

Interpretation: As you see in the pie chart 60% people not investing in mutual fund
only25% are regular investors.

TABLE 6: Showing QUESTION: 4

Q. Your investment portfolio consists in?

OPTIONS NUMBER PERCENTAGE

DEBT 3 7.9%
FD 9 23.7%
MUTUAL FUNDS 12 31.6%
SHARES 14 36.8%
TOTAL 38 100%

SOURCE: Filled survey

Interpretation: Mostly of the persons investing portfolio consist of Fixed deposit, mutual
fund and shares.
33
TABLE 7: Showing QUESTION: 5

Q. Which types of funds you prefer the most?

OPTIONS NUMBER PERCENTAGE

REGULAR INCOME 26 68.4%
DEBT 1 2.6%
DIVERSIFIED EQUITY 7 18.4%
SECTOR FUNDS 4 10.5%
TOTAL 51 100%

SOURCE: Filled survey

Interpretation: Mostly people prefer regular income fund and the rest choose diversified
Equity and sector funds.

TABLE 8: Showing QUESTION: 6

Q. Which Features attract you the most while choosing a specific mutual fund ?

OPTIONS NUMBER PERCENTAGE

FLEXIBILITY 15 38.5%
RETURN 17 43.6%
RISK DIVERSON 4 10.3%
LESS EXPENSE 3 7.7%
TOTAL 39 100%

SOURCE: Filled survey

Interpretation: People attract toward mutual fund because of its return and flexibility.

34
TABLE 9: Showing QUESTION: 7

Q. What type of Mutual Fund Scheme you prefer?

OPTIONS NUMBER PERCENTAGE

OPEN ENDED SCHEME 13 34.2%
CLOSE ENDED SCHEME 2 5.3%
NONE OF THE ABOVE 23 60.5%
TOTAL 38 100%

SOURCE: Filled survey

Interpretation: 34.2% people choose open Ended scheme and the rest choose other
scheme.

TABLE 10: Showing QUESTION: 8

Q. What type of return you expect?

OPTIONS NUMBER PERCENTAGE

MONTHLY 18 46.2%
QUATERLY 5 12.8%
SEMI ANNUAL 6 15.4%
ANNUAL 10 25.6%
TOTAL 39 100%

SOURCE: Filled survey

Interpretation: 46.2% people prefer monthly return and 25.6% prefer annual return.

35
TABLE 11: Showing QUESTION: 9

Q. What is your investment horizon?

OPTIONS NUMBER PERCENTAGE

UPTO 6 MONTHS 14 36.8%
UPTO 1 YEAR 11 28.9%
UPTO 2 YEARS 7 18.4%
UPTO 5 YEARS 6 15.8%
TOTAL 38 100%

SOURCE: Filled survey

Interpretation: Mostly people prefer investment of 6 months or 1 year and the rest above.

TABLE 12: Showing QUESTION: 10

Q. IF not invested in mutual fund, then why?

OPTIONS NUMBER PERCENTAGE

NOT AWARE OF MF 9 26.5%
HIGHER RISK 8 23.5%
NOT INTERESTED 13 38.2%
LESS RETURN 4 11.8%
TOTAL 34 100%

SOURCE: Filled survey

Interpretation: 38.2 % people are not interested in mutual fund and 26.5 % are not
awareof it
36
 FINDINGS
“Small-cap funds offer a great potential for profit. These funds have a higher chance of
outperforming the benchmark during market highs. When the market is in a depression,
however, the fund’s NAV can change dramatically. These funds may be of interest to
risk-seeking investors looking to increase their portfolio returns. Small cap funds, even if
only a small component of your portfolio, can help you build long-term wealth.”

Small cap mutual funds have a history of providing exponential growth and return when
they invest in the appropriate stocks. Because these stocks are less examined and traded
by major investors, there is a significant probability that small-cap funds will find some
inexpensive stocks among small-cap companies.

“Over the course of 5 years, 2017-22, we can see that the top 5 performing mutual funds
have maintained a similar trend in performance in the SC category. The Quant SCF is best
performing fund among all of them, notably outperforming its peers since 2017, with SBI
Small Cap Fund following behind.”

“It has also shown notable growth in performance since 2017 and maintained a similar
pattern to that of the Quant Small Cap Mutual Fund. After that is Kotak Small Cap Fund
which falls short in performance by a considerable margin compared to the second-place
holder. Following Kotak SCF is the HDFC SCF which has performed better and better
over time. Closely behind it is the ABSL Small Cap Fund which has performed worse
since 2017 than before.”

The SCF with most elite performance have different NAVs according to market right
now, however their performance trends have been consistent with market trends and have
typically given returns higher than that of the industry average

37
 CHAPTER: 4
LIMITATIONS OF THE REPORT

Every research endeavor should always aim to arrive at the most exact
findings possible based on the information available. It is, however, carried
out with certain limitations in mind. I did my best to employ useful study
information, however I also discovered the following limitations:

➢ The first concern is that the results are skewed due to survivorship bias,
as the study only included funds that had reported monthly returns and
had survived the study period. The survivorship bias arises from the
truncation of the data set as a result of the fund's departure from the
sample.

Only looking at funds that have survived could lead to an exaggeration

of measured performance. This common occurrence in the fund
business leads to an overestimation of mutual fund performance since
long ago.

➢ The MF market is a fast-paced sector, where hundreds of new funds

being established each year and hundreds more being phased out. This
is done to better align mutual funds with market developments and
investor preferences.

38
 CHAPTER: 5
CONCLUSION:

“Based on the complete analysis, we can conclude that all the small-cap mutual
funds carry minimal risk and a stable high returns assurance by outperforming
a good performance and providing growth. The intermediaries in the investment
business i.e., Fund houses indirectly act as a bridge between the public and
private corporate sectors hence, these are significant engines for mobilizing
resources between common investors and corporates. The main advantages of
mutual funds are that unlike a lot of other investment vehicles, it helps you
create a diversified and balanced portfolio. Due to the increased rivalry in the
industry, MFs companies are offering various kinds of plans to appeal to the investors
tastes. So stock market has been increasing for more than three years, which has helped
to not only safeguard but also grow the money deposited in mutual funds.”In comparison
to ELSS or large size equity-oriented funds, small-cap funds are extremely hazardous and
volatile. Small-cap investments are not an appropriate choice for rookies entering the
market due to the high-risk aspect, but they are great for seasoned investors or those
with a high-risk appetite. Dividends are especially difficult to come by in small-cap funds
because, unlike bigger firms, smaller companies prefer to reinvest any gains in building
their business. Hence, we can safely conclude that by the comparative index of both
mutual funds of mid-cap and small-cap, the small-cap mutual funds are a good investment
option for the investors who are attracting huge investment interest and exponential
growth potential.

39
 RECOMMENDATION FOR FUTURE RESEARCH:

ONE, never make small cap schemes the core portfolio. Small cap schemes
always go through severe phases of ups and downs. So, they will not offer you
stable returns. So, it is better to take a calculated exposure to them to add to
your total returns.

TWO, always opt for fund houses and managers who are known for their skills
in managing small cap schemes. Always keep in mind that investing in small
cap schemes is extremely challenging - it is about identifying promising
companies, taking meaningful stakes well in advance, and holding on to them
patiently to make money. Only a very few fund managers have managed to
deliver superior reruns over a long period.

THREE, make sure the fund size is not very large. It is very difficult to find
investment options in the small cap space. When you have a really large corpus,
it becomes extremely challenging. That explains why many fund houses are
forced to shut their schemes for subscription after a certain point. So, always
choose a scheme with a small corpus.

Last, do not start investing in small cap schemes when you see huge returns
posted by them and stop at the first sign of a fall. This is a sure way to lose
money. If you panic about your investments during a bad phase in the market, it
clearly indicates that you do not have the necessary risk appetite to invest in
small cap schemes. If you have the necessary risk profile and a long-term invest
horizon, invest in small cap schemes regularly over a long period, irrespective
of the market conditions. That is the only way to make money on your small
cap investments.

40
 REFERENCES

☆Journals

A. Khurana, A., & Panjwani, K. (2010). Hybrid mutual funds: An analysis. Asia Pacific Journal
of Research in Business Management. Volume 1, Issue 2, ISSN 2229-4104.

B. HemaDivya, K. (2012). A Comparative study on Evaluation of Selected Mutual Funds in India.

International Journal of Marketing and Technology. Volume 2. Issue 4. Pp 238-261. ISSN:
2249-1058.

Websites

A. http://www.indiainfoline.com/MutualFunds/Balanced-Funds.aspx

B. http://nseindia.moneycontrol.com/mutualfundindia/tracker_home.php

C. http://www.indiainfoline.com/MutualFunds/Regular-Funds.aspx

D. http://www.indiainfoline.com/MutualFunds/Direct-Funds.aspx

E. http://www.dnb.co.in/bfsisectorinindia/MFund5.asp

41
 ANNEXURE:

QUESTIONNAIRE
NAME:…………………………………………………………………….

GENDER: (a) Male (b) Female (c) Prefer not to say

AGE: (a) Below 18 (b) 18-25 (c) 25-30

(d) Above 30

1•According to you, are mutual funds good?

(a) Yes
(b) No
(c) Maybe
(d) Not interested

2) What is your source of information while investing in mutual funds?

(a) Internet
(b) Magazine
(c) Financial advisor
(d) Friends

3•Are you a regular or a new investor in mutual fund?

(a) Regular
(b) New
(c) Not an investor

4•Your investment portfolio consists in ?

(a) Debt
(b) Fixed deposit
(c) Mutual fund
(d) Shares

5• Which type of fund you prefer the most?

(a) Regular income
(b) Debt
(c) Diversified Equity
(d) Sector funds
42
6• Which Features attract you the most while choosing a specific mutual fund ?
(a) Flexibility
(b) Return
(c) Risk diversion
(d) Less expense

7• What type of Mutual Fund Scheme you prefer?

(a) Open Ended Scheme
(b) Close Ended Scheme
(c) None of the above

8•What type of return you expect?

(a) Monthly
(b) Quarterly
(c) Semi annual
(d) Annual

9•What is your investment horizon?

(a) Upto 6 months
(b) Upto 1 year
(c) Upto 2 years
(d) Upto 5 years

10• IF not invested in mutual fund then why?

(a) Not aware of Mutual Fund
(b) Higher Risk
(c) Not interested
(d) Less return

43