A

RESEARCH REPORT
ON

“STUDY OF HDFC MUTUAL FUND”

SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE DEGREE OF MASTERS OF BUSINESS
ADMINISTRATION.

Submitted To: Submitted By:

Sargam Bahl Aakash Chaudhary
(Faculty)

SCHOOL OF MANAGEMENT
GRAPHIC ERA HILL UNIVERSITY,
DEHRADUN
BATCH 2022-2024
 DECLARATION

I, Aakash Chaudhary, student of GRAPHIC ERA HILL UNIVERSITY, 2022-24, batch

declare that every part of the project report, “Study of HDFC Mutual Fund” that I have

submitted is original. I was in regular contact with the nominated guide.

The empirical findings in the report are based on the data collected by myself. It is a result of my

hard work. I have not copied anything from any resources or any other projects submitted for the

similar purpose.

DATE: Aakash Chaudhary

PLACE MBA- IVth Sem.
 ACKNOWLEDGEMENT

It gives me immense pleasure to place before my examiners my Project Report “STUDY OF

HDFC MUTUAL FUND” The need for this project was felt because communication has been

accepted as one of the important source in the human society.

I am thankful to Sargam Bahl (Faculty) and all faculty members of MBA Department who

helped me to materialize this report.

I would also take the chance to express my sincere thanks to the staff of the “HLM College,
Ghaziabad” that were extremely cooperative in providing relevant materials.
My happiness cumulates when I recalled the corporation extended by my friends during the
completion of this project.

Final and hearty thanks go to my parents.

Aakash Chaudhary

MBA IVth Sem.

PREFACE

The project program of Master Business Administration involves the exposure of student to get

an insight in the real life business situation. This practical training gives an ample opportunity to

apply ones academic knowledge in the field substantiate by ones personality, initiative and

capabilities.
Although, each business strategy is unique, it is not comparable with that of other firms or other

kind. Yet it provides a background to possible aspects of any problem and choosing the best

alternative.

Marketing/Consumer Research is a method by which one can feel the nerve of the market. It is

used to find out the attitude of consumer toward the product. It also help in explaining the fact

that how do consumers make decisions in favour of certain brands.

The entire project helps me in gaining valuable experience & knowledge during the survey. The

project consists of various findings after tabulation of collected data, then analyzed conclusions

were drawn and finally suggestions were put forward.

 TABLE OF CONTENTS

TABLE OF CONTENTS

Contents Page number

Introduction 7-17

Objective 18-19

Review of Literature 22-65

Research and methodology 66-70

Data Analysis & Interpretation 71-75

Conclusion 76-77

Recommendations 78-80

Annexure 81-86
 INTRODUCTION

INTRODUCTION

The economy is highly influenced by the Financial System of the country. The Indian Financial

System has been broadly divided into two segments: the organized and unorganized. An investor

has a wide array of investment avenues available. Economic well being in the long run depends

significantly on how wise he invests.

In present financial scenario where the economy is poised to grow at 9% ,as stated by our finance

minister P Chidambaram, and the present bulls run in the capital market ,where lot of money is

being pumped into the economy by FII, and increasing disposable income with the generation

next has created a problem of investment because there is lot money on hand but they don’t

know where to invest as there is no attractive return in the bank FD, PPF, KVP, NSC, MIS, and

other Post saving scheme.

Due to uncertainty in share market and low returns due to low interest a rate has left investor are

puzzled, i.e. to spend the money or save the money. If to save the money then where to save it, so

that they can get better return with flexibility, tax benefit and as well as capital appreciation. So it
is necessary for investor to find the answer and way of capital growth with better return rather

than uncertain share market and other low yield investment avenues.

All investments involve risk in varying degrees, and hence it is necessary to understand risk

profile of each investment avenues and know how it can affect your investments. There should

be trade off between risk and return. There are also risks that are not in our control like inflation

risk, credit risk, risk of sudden rise in oil prices, risk pertaining to political environment for

instance. In present financial system, investment has lost their potential to earn additional

income, which can help for growth of their capital because the interest return which varies from

approx 4% to 8% and the inflation rate hovering in and around 5%-6% so the real return is

varying between (-)2% to 2% so this is the real return what a investor gets by investing in

FIXED DEPOSIT, GOVERNMENT SECURITY ,KVP,NSC,PPF,MIS and also blocking their

money for min of 2-5 years ,in these instruments ,which is not very encouraging for an investor

to invest in these instruments .So the investor is likely to spend his earnings than invest(save),

which what is happening in our country.

Mutual fund is indeed of great benefit in this respect. They provide the services of experienced

and skilled professionals who determine this risk and monitor them ongoing basis they are also

backed up by research, done by individual asset Management Company based on the fund

objectives.

When investors are confronted with an outstanding range of products, form traditional bank

deposits to downright shady money-multiples schemes, it has to be judged on the yardsticks of

returns, liquidity, safety, convenience and tax efficiency. An important question facing many

investors across the country today is whether one should invest in a bank fixed deposit or in a

debt-oriented Mutual Fund. Mutual fund gives an opportunity to the IFA’s to select from different

investment options ranging from liquid funds to diversified equity, based on their client’s

appetite for risk and the return they want.

During the training period and interaction with people it was found that awareness of Mutual

Fund among IFA’s was there to a limited extent but there was lot of misconceptions among them

about mutual fund as We had meet few who had lost their money in UTI scam and others though

where aware of mutual fund where not suggesting this to their clients as they thought it as to be

to risky for their clients and those who were aware where really aggressive to take the

opportunity offered by mutual fund to earn a high return. On the whole if We have to conclude

my survey We would like to say that if we have to create awareness about diversified portfolio,

professional management and SEBI Regulations and benefits it offers to IFA’s and their clients

and also we have to clear few misconception which IFA’s have, to tap the huge potential which

mutual fund market has to offer.

SHORT HISTORY OF MUTUAL FUNDS

WHERE DID THEY COME FROM?

Mutual funds are not an American invention. The first was started in the Netherlands in 1822,

and the second in Scotland in the 1880's. Originally called investment trusts, the first American

one was the New York Stock Trust, established in 1889. Most that followed were begun in

Boston in the early 1920's, including the State Street Fund, Massachusetts Investor's Trust (now

called MFS), Fidelity, Scudder, Pioneer, and the Putnam Fund. The Wellington Fund, the first

balanced fund that included both stocks and bonds, was founded in 1928, and today is part of the

giant Vanguard Funds Group. In the 1960's there was a phenomenal rise in aggressive growth

funds (with very high risk). Sometimes called "go-go" or "hot-shot" funds, they received the

majority of the billions of dollars flowing into mutual funds at that time. In 1968 and 1969, over

100 of these new aggressive growth funds were established.

A severe bear market began in the autumn of 1969. People became disillusioned with stocks and

mutual funds. The market's toast. It’ll never get back to where it was!" was echoed by panicked

investors. Unemployment grew; inflation went crazy, and investors pulled billions back out of

the funds. They should have hung in there! Many funds have risen 9,000% since then.

The 1970's saw a new kind of fund innovation: funds with no sales commission called "no load"

funds. The largest and most successful no load family of funds is the Vanguard Funds, created by

John Boggle in 1977.

At the end of the 1920's there were only 10 mutual funds. At the end of the 1960's there were

244. Today there are more than 6,500 unique funds and even thousands more that differ only by

their share class (how they are sold, and how their expenses are charged).
Before we continue with all you need to know about mutual funds, here is something that merits

your attention. Since 1940, no mutual fund has gone bankrupt. You sure can't say that about

banks and savings and loans!

THE CONCEPT OF MUTUAL FUND IN DETAIL

“A mutual fund is a common pool of money into which investors place their contributions that

are to be invested in accordance with a stated objective. The ownership of the fund is thus joint

or “mutual”, fund belongs to all investors. The work ‘Mutual’ means a vehicle wherein the

benefits of a certain investment are reaped by investors in proportion to their investment.”

A mutual fund uses the money collected from investors to buy those assets which are specifically

permitted by its stated investment objective. Thus, an equity fund would buy equity assets –

ordinary shares, preference shares, warrants etc. A bond fund would buy debt instruments such as
debentures, bonds or government securities. It is these assets which are owned by the investors in

the same proportion as their contribution bears to the total contributions of all investors put

together.

When an investor subscribes to a mutual fund, he or she buys a part of the assets or the pool of

funds that are outstanding at that time. It is no different from buying “shares” of joint stock

Company, in which case the purchase makes the investor a part owner of the company and its

assets. In fact, in the USA, a mutual fund is constituted as an investment company and an

investor “buys in to the fund”, meaning he buys the shares of the fund. In India, a mutual fund is

constituted as a Trust and the investor subscribes to the “units” issued by the fund, which is

where the term Unit Trust comes from. However, whether the investor gets fund shares or units

is only a matter of legal distinction. In any case, a mutual fund shareholder or unit-holder is a

part owner of the fund’s assets. The term unit-holder includes the mutual fund account-holder or

close-end fund shareholder.

A Mutual Fund is a trust that pools the savings of a number of investors who share a common

financial goal. The money thus collected is then invested in capital market instruments such as

shares, debentures and other securities. The income earned through these investments and the

capital appreciation realized is shared by its unit holders in proportion to the number of units

owned by them. Thus Mutual fund is 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.

TYPES OF MUTUAL FUNDS

There are two BASIC TYPES of mutual funds. "Open-ended" or "Open" mutual funds are the

most common type of mutual funds. Investors may purchase units from the fund sponsor or

redeem units at the valuation promised in the fund documents, usually on a daily basis. "Closed-

ended" or "Closed" mutual funds are traded as financial securities, once they are issued, and

holders must sell their units on the stock market to receive their funds back.

• AS PER INVESTMENT OBJECTIVE

Schemes can be classified by the way of their stated investment objective such as Growth Fund,

Balanced Fund and Income Fund etc

• EQUITY ORIENTED SCHEMES

These schemes, also commonly called Growth Schemes, seek to invest a majority of their funds

in equities and a small portion in money market instruments. Such schemes have the potential to

deliver superior returns over the long term. However, because they invest in equities, these
schemes are exposed to fluctuations in value especially in the short term. Equity schemes are

hence not suitable for investors seeking regular income or needing to use their investments in the

short term. They are ideal for investors who have a long term investment horizon.

General Purpose
The investment objectives of general-purpose equity schemes do not restrict them to invest in
specific industries or sectors. They thus have a diversified portfolio of companies across a large
spectrum of industries. While they are exposed to equity price risks, diversified general purpose
equity funds seek to reduce the sector or stock specific risks through diversification. They mainly
have market risk exposure. HDFC Growth Fund is a general purpose equity scheme.

Sector Specific
The schemes restrict their investing to one or more pre-defined sectors, e.g. technology sector.
Since they depend upon the performance of select sectors only, these schemes are inherently
more risky than general purpose schemes. They are suited for informed investors who wish to
take a view and risk on the concerned sector.

ORGANISATION OF MUTUAL FUND

THE STRUCTURE CONSISTS OF:

SPONSOR

Sponsor is the person who acting alone or in combination with another body corporate

establishes a mutual fund. Sponsor must contribute at least 40% of the net worth of the

Investment managed and meet the eligibility criteria prescribed under the Securities and

Exchange Board of India (Mutual Fund) Regulations, 1996. The sponsor is not responsible or

liable for any loss or shortfall resulting from the operation of the Schemes beyond the initial

contribution made by it towards setting up of the Mutual Fund.

TRUST

The Mutual Fund is constituted as a trust in accordance with the provisions of the Indian Trusts

Act, 1882 by the Sponsor. The trust deed is registered under the Indian Registration Act, 1908.

TRUSTEE

Trustee is usually a company (corporate body) or a Board of Trustees (body of individuals). The

main responsibility of the Trustee is to safeguard the interest of the unit holders and ensure that

the AMC functions in the interest of investors and in accordance with the Securities and

Exchange Board of India (Mutual Funds) Regulations, 1996, the provisions of the Trust Deed

and the Offer Documents of the respective Schemes. At least 2/3rd directors of the Trustee are

independent directors who are not associated with the Sponsor in any manner
OBJECTIVE OF THE STUDY

OBJECTIVE
The main aim of the study is to accomplish the following objective:

• To know about HDFC mutual funds.

• To know about financial statements of HDFC mutual funds.

• To know the satisfaction level of the customers on value added services provided by the

HDFC Standard life insurance company

• To know the motivational factors those made them buy an insurance policy from the

company.

• To know the image of the private life insurance companies in the minds of the customers.

• To know the preferences of the people in the taking policies by conducting market survey.

• To know the perception of the customers on value added services offered by private

HDFC Standard life insurance

LITERATURE REVIEW
 LITERATURE REVIEW
MAN WITH A MISSION

Mr. H.T. PAREKH is conferred the

Padma Bhushan by the Government

of India in the year 1992.

 If ever there was a man with a mission it was Hasmukhbhai Parekh,

Founder and Chairman-Emeritus, of HDFC Group who left this earthly abode on November 18,

1994. Born in a traditional banking family in Surat, Gujarat, Mr. Parekh started his financial

career at Harkisandass Lukhmidass – a leading stock broking firm. The firm closed down in the

late seventies, but, long before that, he went on to become a towering figure on the Indian

financial scene.

In 1956 he began his lifelong financial affair with the economic world, as General

Manager of the newly-formed Industrial Credit and Investment Corporation of India (ICICI). He

rose to become Chairman and continued so till his retirement in 1972.

At the ripe age of 60, Hasmukhbhai started his second dynamic life, even more illustrious than

his first. His vision for mortgage finance for housing gave birth to the Housing Development

Finance Corporation – it was a trend-setter for housing finance in the whole Asian continent.

He was also a writer in his own right. There are over 200 published articles by him...

In 1992, the Government of India honoured him with the Padma Bhushan Award. The London

School of Economics & Political Science conferred on him an Honorary Fellowship.

He was one of the Founder Members of the Centre for Advancemen

t of Philanthropy, and it’s Chairman till 1993.

He took active interest in the Bombay Community Public Trust, designed specifically to serve

the needs of the city’s underprivileged citizens.

When Mr. Deepak Parekh took over as Chairman from Hasmukhbhai, he said: “Taking over from

H.T. Parekh is a formidable task; his vision… brought about not only an institution, but an entire

concept which has proved itself to be of lasting importance.”

Today we are the largest residential mortgage finance institution in India, with a net worth of Rs.

2,703 cores as of March 31, 2006 and an asset base of over Rs. 22,000 cores. We also aim to

increase the flow of resources to the housing sector by integrating the housing finance sector

with the overall domestic financial markets.

Over a span of 25 years, HDFC has become the pioneer in housing finance in India and made it

possible for over two million Families to own their homes, through housing loans worth over Rs.

42,000 cores.

ABOUT COMPANY HDFC

 VISION

To be a dominant player in the Indian mutual fund space, recognized for its high levels of ethical

and professional conduct and a commitment towards enhancing investor interests.

ORGANIZATION AND MANAGEMENT

HDFC is a professionally managed organization with a board of directors

consisting of eminent persons who represent various fields including finance, taxation,

construction and urban policy & development. The board primarily focuses on strategy

formulation, policy and control, designed to deliver increasing value to shareholders.

Name and Designation Location Contact Number

Mr. Deepak S. Parekh is the executive Chairman of the Corporation. He is fellow of the Institute

of Chartered Accountants (England & Wales).Mr. Parekh joined the Corporation in a senior

management position in 1978.He was inducted as a whole time director of the Corporation in
1985 and was appointed as the Chairman in 1993. He is the chief executive officer of the

Corporation Mumbai.

Mr. K. M. Mistry the Managing Director of the Corporation. Is a Fellow of

the Institute of Chartered Accountants of India? He has been employed with the Corporation

since 1981 and was the executive director of the Corporation since 1993. He was appointed as

the deputy managing director in 1999 and the Managing Director in 2000. He is also a member

of the Investors’ Grievance Committee of Directors.

Ms. Renu S. Karnad the Executive Director of the Corporation. Is a

graduate in law and holds a Master’s degree in economics from Delhi University. She has been

employed with the Corporation since 1978 and was appointed as the Executive Director of the

Corporation in 2000. She is responsible for overseeing all aspects of lending operations of

HDFC.New Delhi.

BOARD OF DIRECTORS
 Mr. D S Parekh - Chairman Mr. D N Ghosh

Mr. Keshub Mahindra - Vice Chairman Dr. S A Dave

Ms. Renu S. Karnad - Executive Director Mr. S Venkitaramanan

Mr. K M Mistry - Managing Director Dr. Ram S Tarneja

Mr. Shirish B Patel Mr. N M Munjee

Mr. B S Mehta Mr. D M Satwalekar

HDFC ASSET MANAGEMENT COMPANY LIMITED (AMC)

AMC was incorporated under the Companies Act, 1956, on December 10, 1999, and was

approved to act as an AMC for the Mutual Fund by SEBI on July 30, 2000.

The registered office of the AMC is situated at Ramon House, 3rd Floor, H.T. Parekh Marg, 169,

Back bay Reclamation, Church gate, Mumbai - 400 020.

In terms of the Investment Management Agreement, the Trustee has appointed HDFC Asset

Management Company Limited to manage the Mutual Fund

As per the terms of the Investment Management Agreement, the AMC will conduct the

operations of the Mutual Fund and manage assets of the schemes, including the schemes

launched from time to time.

The present share holding pattern of the AMC is as follows:

Particulars % of the paid up capital

Housing Development Finance Corporation Limited 50.10

Standard Life Investments Limited 49.90

Zurich Insurance Company (ZIC), the Sponsor of Zurich India Mutual Fund, following a review

of its overall strategy, had decided to divest its Asset Management business in India. The AMC

had entered into an agreement with ZIC to acquire the said business, subject to necessary

regulatory approvals.

On obtaining the regulatory approvals, the Schemes of Zurich India Mutual Fund has now

migrated to HDFC Mutual Fund on June 19, 2003. These schemes have been renamed as

follows:

FORMER NAME NEW NAME

Zurich India Equity Fund HDFC Equity Fund

Zurich India Prudence Fund HDFC Prudence Fund

Zurich India Capital Builder Fund HDFC Capital Builder Fund

Zurich India Tax Saver Fund HDFC Tax Saver Fund

Zurich India Top 200 Fund HDFC Top 200 Fund

Zurich India High Interest Fund HDFC High Interest Fund

Zurich India Liquidity Fund HDFC Liquidity Fund

Zurich India Sovereign Gilt Fund HDFC Sovereign Gilt Fund

The AMC is managing 2 close ended Income Scheme viz. HDFC Fixed Investment Plan and

HDFC Long Term Equity Fund and 23 open-ended schemes of the Mutual Fund viz. HDFC

Growth Fund (HGF), HDFC Balanced Fund (HBF), HDFC Income Fund (HIF), HDFC Liquid

Fund (HLF), HDFC Long Term Advantage Fund, HDFC Tax Plan 2000 (HTP), HDFC

Children's Gift Fund (HDFC CGF), HDFC Gilt Fund (HGILT), HDFC Short Term Plan (HSTP),

HDFC Index Fund, HDFC Floating Rate Income Fund (HFRIF), HDFC Equity Fund (HEF),

HDFC Top 200 Fund, (HT200), HDFC Capital Builder Fund (HCBF), HDFC Tax Saver (HTS),

HDFC Prudence Fund (HPF), HDFC High Interest Fund (HHIF), HDFC Sovereign Gilt Fund

(HSGF) and HDFC Cash Management Fund (HCMF), HDFC MF Monthly Income Plan

(HMIP), HDFC Core & Satellite Fund (HSCF), HDFC Multiple Yield Fund (HMYF), HDFC

Premier Multi-Cap Fund (HPM) and HDFC Multiple Yield Fund Plan 2005 (HMY2005).

The AMC is also providing portfolio management / advisory services and such activities are not

in conflict with the activities of the Mutual Fund. The AMC has renewed its registration from

SEBI vide Registration No. - PM / INP000000506 dated December 22, 2000 to act as a Portfolio

Manager under the SEBI (Portfolio Managers) Regulations, 1993. The Certificate of Registration

is valid from January 1, 2004 to December 31, 2006.

SPONSORS
HOUSING DEVELOPMENT FINANCE CORPORATION LIMITED (HDFC):

HDFC was incorporated in 1977 as the first specialised housing finance institution in India.

HDFC provides financial assistance to individuals, corporate and developers for the purchase or

construction of residential housing. It also provides property related services (e.g. property

identification, sales services and valuation), training and consultancy. Of these activities, housing

finance remains the dominant activity.

HDFC currently has a client base of over 8, 00,000 borrowers, 12, 00,000 depositors, 92,000

shareholders and 50,000 deposit agents. HDFC raises funds from international agencies such as

the World Bank, IFC (Washington), USAID, CDC, ADB and KFW, domestic term loans from

banks and insurance companies, bonds and deposits. HDFC has received the highest rating for its

bonds and deposits program for the ninth year in succession. HDFC Standard Life Insurance

Company Limited, promoted by HDFC was the first life insurance company in the private sector

to be granted a Certificate of Registration (on October 23, 2000) by the Insurance Regulatory and

Development Authority to transact life insurance business in India.

HDFC is India's premier housing finance company and enjoys an impeccable track record in

India as well as in international markets. Since its inception in 1977, the Corporation has

maintained a consistent and healthy growth in its operations to remain the market leader in

mortgages. Its outstanding loan portfolio covers well over a million dwelling units. HDFC has

developed significant expertise in retail mortgage loans to different market segments and also has

a large corporate client base for its housing related credit facilities. With its experience in the
financial markets, a strong market reputation, large shareholder base and unique consumer

franchise, HDFC was ideally positioned to promote a bank in the Indian environment.

STANDARD LIFE INVESTMENTS LIMITED

The Standard Life Assurance Company was established in 1825 and has considerable experience

in global financial markets. In 1998, Standard Life Investments Limited became the dedicated

investment management company of the Standard Life Group and is owned 100% by The

Standard Life Assurance Company.

With global assets under management of approximately US$186.45 billion as at March 31, 2005,

Standard Life Investments Limited is one of the world's major investment companies and is

responsible for investing money on behalf of five million retail and institutional clients

worldwide. With its headquarters in Edinburgh, Standard Life Investments Limited has an

extensive and developing global presence with operations in the United Kingdom, Ireland,

Canada, USA, China, Korea and Hong Kong. In order to meet the different needs and risk

profiles of its clients, Standard Life Investments Limited manages a diverse portfolio covering all

of the major markets world-wide, which includes a range of private and public equities,

government and company bonds, property investments and various derivative instruments. The

company's current holdings in UK equities account for approximately 2% of the market

capitalization of the London Stock Exchange.

HDFC MUTUAL FUND PRODUCTS

Equity Funds

HDFC Growth Fund

HDFC Long Term Advantage Fund

HDFC Index Fund

HDFC Equity Fund

HDFC Capital Builder Fund

HDFC Tax saver

HDFC Top 200 Fund

HDFC Core & Satellite Fund

HDFC Premier Multi-Cap Fund

HDFC Long Term Equity Fund

HDFC Mid-Cap Opportunity Fund

Balanced Funds

HDFC Children's Gift Fund Investment Plan

HDFC Children's Gift Fund Savings Plan

HDFC Balanced Fund

HDFC Prudence Fund

Debt Funds

HDFC Income Fund

HDFC Liquid Fund

HDFC Gilt Fund Short Term Plan

HDFC Gilt Fund Long Term Plan

HDFC Short Term Plan

HDFC Floating Rate Income Fund Short Term Plan

HDFC Floating Rate Income Fund Long Term Plan

HDFC Liquid Fund - PREMIUM PLAN

HDFC Liquid Fund - PREMIUM PLUS PLAN

HDFC Short Term Plan - PREMIUM PLAN

HDFC Short Term Plan - PREMIUM PLUS PLAN

HDFC Income Fund Premium Plan

HDFC Income Fund Premium plus Plan

HDFC High Interest Fund

HDFC High Interest Fund - Short Term Plan

HDFC Sovereign Gilt Fund - Savings Plan

HDFC Sovereign Gilt Fund - Investment Plan

HDFC Sovereign Gilt Fund - Provident Plan

HDFC Cash Management Fund - Savings Plan

HDFC Cash Management Fund - Call Plan

HDFCMF Monthly Income Plan - Short Term Plan

HDFCMF Monthly Income Plan - Long Term Plan

HDFC Cash Management Fund - Savings Plus Plan

HDFC Multiple Yield Fund

HDFC Multiple Yield Fund Plan 2005

ACHIEVEMENT AND AWARDS

• These annual awards are given to top performing Banks in the categories of Best Bank,

Fastest Growing Bank, Most Tech-savvy Bank, Best Banker and Lifetime Achievement,

among others in 2013.

• “HDFC Prudence fund” has been ranked ICRA-MFR 1, and Has Been awarded the Gold

Award for ‘Best Performance’ in the category of “Open Ended Balanced Scheme” for one

year Period Ending Dec 31, 2005.

• “HDFC Tax saver fund” has been ranked ICRA-MFR 1, and Has Been Silver award for

“Second Best Performance” in the category of “Open Ended Equity Linked Saving

Scheme(ELSS)” for Three year Period Ending Dec 31, 2005.

• “HDFC MIP~LTP” has been ranked ICRA-MFR 1, and Has been awarded the Gold Award

For “Best Performance” in the category of “Open Ended Marginal Equity Scheme” for one

year Period Ending Dec 31, 2005.

DEPARTMENT DETAILS

OPERATION DETAILS
PRODUCTION / OPERATION PROCESS

A process is any activity or group of activities that takes one or more inputs, transforms and add

value to them, and provides one or more output for its customers.”

“The term operation management refers to the direction and control of the process that transform

inputs into product and services.”

LOCATION DETAILS

HDFC AMC is located at Yagnik road which is in the heart of the city where service is easily

available for all customer and easy access compare with other place that available in city.

Location has major impact on success or failure of operation. Advantages of this type of location

are that service cost and distribution cost is minimum comparison with other place.

The major investor service centres of HDFC MUTUAL FUND are as below.

LAYOUT DETAILS
There is a plan of all the act of planning & optimum arrangement of planning including flow of

man & material and customer, operating equipment, storage space, material handling equipments

and all other supporting services along with the design of best structure to contain all these

facilities.

PLANNING AND CONTROL

It is useful for effective utilization of resources, to achieve organization goal and objectives with

respect to quality service, cost control timely service to co-ordinate with other department to

ensure continuous quality service. There is a proper planning and planning with respect to which

type of scheme to be introduced, what are expenses of R&D for finding out feasibility of that

scheme, how many people will work on that particular job, before introducing new scheme.

There is special research department for carrying out the analysis of market and there is a fund

manager who carries out all planning for investing in various sector and he is also responsible for

controlling the cost of transaction so that it can give return to investors.

MAINTENANCE

HDFC AMC is the service sector industry so all work is carried out with the help of computer

System. There is contract given to service provider and other maintenance is done by staff itself.

PROCUREMENT

HDFC AMC is the service sector industry so procurement is only for computer machinery and

computer stationary and other stationary include brochures of all the schemes and monthly fact

sheet is used in daily work.

MARKETING DETAILS
Marketing generally refers as the task of creating, promoting and delivering goods and services

to consumers and business. Marketing managers seeks to influence the level of timing and

composition of demand to meet the organisation’s objectives. Marketing people are involved in

10types of entities: goods, services, experiences, events, persons, places, properties,

organization, information and ideas. The marketing concept rests on four pillars: target market,

customer needs, integrated marketing and profitability.

“Marketing is defined as a societal process by which individuals and groups obtain what they

need and want through creating, offering and freely exchanging products and services of value

with others.

The basic four P’s of marketing are PRODUCT, PRICE, PLACE and PROMOTION.

MARKETINGSCENARIO

The last few years have seen an increased attention to mutual funds across all genres of

investors’ big or small, individuals or corporate. The growing awareness of the advantages that

mutual funds offer over other investments avenues have been better communicated and more

understood.

A mutual fund is the ideal investment vehicle for today’s complex and modern financial scenario.

Markets for equity shares, bonds and other fixed income instruments, real estate, derivatives and

other assets have become mature and information driven. Price changes in these assets are driven

by global events occurring in faraway places. A typical individual is unlikely to have the

knowledge, skills, inclination and time to keep track of events, understand their implications and

act speedily.
A mutual fund is answer to all these situations. It appoints professionally qualified and

experienced staffs that manages each of these functions on a fulltime basis. Now, Mutual Fund is

new developing market. In fact, the mutual fund vehicle exploits economies of scale in all three

areas –research, investment and transaction processing.

MARKET SEGMENTATION

Market segmentation is an effort to increase a company’s precision marketing. A market segment

consists of large identifiable group within a market with similar wants, purchasing power, buying

attitudes or buying habits. As HDFC mutual fund is a service sector industry they introduce

different schemes for different people. Each person is different in nature and each have differ

criteria for investment like risk factor, return, liquidity, tax benefits etc.

So that HDFC Asset management company have introduced variety of scheme like debt scheme,

balanced scheme, equity related scheme and each schemes have option to invest in SIP

(Systematic Investment Plan) which help investor to invest a specific amount for a continuous

period, at regular intervals so that investor has the advantage of rupee cost averaging and also

helps him save compulsorily a fixed amount each amount.

TARGET MARKET

HDFC Asset Management Company is a joint venture of HDFC bank (50.10%) and Standard

Life Investment Limited (49.90%). The joint venture was formed with the key objective of

providing the Indian investor mutual fund products to suit a variety of investment needs. HDFC
Asset Management Company, have variety of scheme both open ended and close ended scheme.

Both have different objective and different target market. Equity Mutual Fund Scheme has target

market of person who wants to take high risk and also expect high return.

Balanced scheme have target market of person who wants to take moderate risk and expect

average return and Debt scheme have target market of person who wants to take less risk. Close

ended scheme have target market of person who wants long term equity investment.

CUSTOMERS’ PROFILE

HDFC Asset Management Company, have variety scheme and each scheme have different

customer profile. For Equity related scheme customer profile is young generation, for liquid

scheme customer profile is business man who wants to utilize their money in effective manner

for shorter period, in SIP (Systematic Investment Plan) customer basically are serviced person

who invest regularly and want to earn more than average return. Thus, HDFC Asset

Management Company, have introduced variety of scheme to suit need of variety of customer.

POSITIONING STRATEGY

“Positioning is the act of designing the company’s offering and image to occupy a distinctive

place in the target market’s mind.”Positioning starts with a product. A piece of merchandise, a

service, a company, an institution, or even a person. But positioning is not what you do to a

product. Positioning is what you do the mind of the prospect. That is, you position the product in

the mind of prospect. A company’s differentiating and positioning strategy must change as the

product, market, and competitors change over time. Once the company has developed a clear
positioning strategy, it must communicate at the positioning effectively. There should be no

under positioning, over positioning, confused positioning or doubtful positioning.

HDFC Asset Management Company, have positioning strategy of “Continuing a Tradition of

Trust”. It is accurate positioning strategy because it signifies a trust with its clients.

Here is special Relationship Manager dedicated towards customer service and satisfaction and

give them guidance about various schemes which helps them to get right scheme which suit their

investment needs. In this way it continues to maintain a trust with its clients.

DISTRIBUTION COMPANIES

Availing of the services of established distribution companies is practice accepted by mutual

fund internationally. This practice evolve with a view to provide the huge administrative

mechanism require supporting a large agent force. Instead of having to deal with several agents,

a fund can interact with distribution a company which has several employees or sub brokers

under it.

BANK & NBFCS

In developed countries, bank are an important marketing vehicles for mutual funds given that

banks themselves had large depositors/ clients base of their own. We can see the opening up of

this new channel now in India. Several banks, particularly private and foreign banks are involved

in fund distribution by providing services similar to those of distribution companies, on a

commission basis.

DIRECT MARKETING
Direct marketing means that the mutual funds sell their own products without any use of

intermediateries. Usually, this takes the form of the sales officer and employees of the AMC who

approach the investor and accept their contribution directly. However in India, independent

agents may really be created as a direct marketing channel in a sense that they do not form a well

knit independent and organized a single entity and act more like fund employees. Others channel

like distribution companies or banks or even stock brokers are clearly distinct and independent

intermediaries.

PRICING POLICY

HDFC Asset Management Company is service Provider Company so there is Entry Load and

Exit Load for each scheme.

NO Scheme name Entry load Exit load

1 Equity Funds 2.25% <=5 cr Nil

Nil above 5 cr

2 SIP 2.25 % 1.25% before 6

months

Thus each scheme has different Entry Load and Exit Load.
PROMOTIONAL TOOLS

The objective of advertising of HDFC AMC is to create awareness about services and scheme of

HDFC among investors and sub-brokers and increase sub-brokers of HDFC AMC.

Company does give advertisement in media like Newspapers, and Magazines etc. when in

introduce new scheme or mutual fund IPO and through direct marketing they advertise and

create awareness about their services and new schemes. HDFC also do presentation about

various schemes so that investors can know more about their product and services.

Another tool of promotion of HDFC AMC is Public Relation involves a variety of programs

designed to promote or protect a company’s image or its individual products. HDFC has PR

department monitors the attitudes of the organization’s publics and distributes information and

communications to build goodwill. They also perform following function:

Press relation: Presenting news and information about the HDFC AMC in the most positive light.

Product publicity: Sponsoring efforts to publicize specific products.

Counselling: Advising management abut public issues and company positions and image.

HUMAN RESOURCE DETAILS

HUMAN RESOURCE MANAGEMENT

“Human Resource Management function that helps managers recruits select, train and develop

members for an organization. Obviously, HRM is concerned with the people’s dimension in

organizations
In all business concerns, there is one common element i.e. HUMAN RESOURCE. Work force

of an Organization is one of the most important inputs of components. It is said that people are

our single most important assets. Because of the unique importance of HUMAN RESOURCE

and its complexity due to ever changing psychology, behaviour and attitudes of men and women

at work, personnel function, i.e., manpower management function is becoming increasingly

specialized. The personnel function or system can be broadly defined as the management of

people at work- management of managers and management of workers. Personnel function is

particularly interested in personnel relationship and interaction of employees-human relations.

In a sense, management is personnel administration. Management is the development of people,

and not mere direction of material resources. Human capital is the greatest asset of a business

enterprise. The essential ingredient of management is the leadership and direction of people.

Each manager of people has to be his own personnel man. Personnel management is not

something you really turn over to personnel department staff.

DEFINITIONS

According to Edward Flippo “ Personnel management organizing, directing and controlling of

the procurement, development, compensation, integration, maintenance and separation of human

resources to the end that individual, organizational and societal objectives are accomplished.”

“Personnel planning are the process by which an organization ensures that is has the right

number and kind of people, at right places, at the right time, capable of effectively and efficiently

completing those tasks that will help the organization achieve its overall objectives.”
MANPOWER PLANNING

Human Resource Planning is the process by which an organization ensures that it has the right

number and kind of people, at the right place, at the right time, capable of effectively and

efficiently competing those tasks that will help the organization achieve its overall objectives.

Human Resource Planning translates the organization’s objectives and plans into the number of

workers meet those objectives. Without a clear-cut planning, estimation of an organization’s

human resource need is reduced to mere guesswork

Manpower planning is needed with respect to persons who can work as sub-broker for the

companies. Companies focus on Advisors of Mutual Fund product and ELSS schemes of HDFC

AMC and focused on Insurance Advisor and post office agent, Tax consultants and CAs for

making sub-broker.

HDFC AMC follows the following process:

The first step is forecasting the need of man power in terms of divisions, department or

functions. Along with the estimate of the number of the people required in different departments

it is also decided that at which level they will be needed.

After estimating the man power requirement, next step is to have a look at the current human

resource. The current human resource is assessed so as to know whether the requirement can be

filled by the existing personnel or not.

At last detailed policies for recruitment, selection, training, promotion, retirement, replacement

etc. of existing and new employees to meet the forecasted needs is made

HDFC is incorporated under the companies Act 1956, December 10, 1999

• CULTURE
INTEGRITY

Integrity is central filature of HDFC culture and hence HDFC AMC is no exception and the same

is expected of the dealings, behaviour and work conduct.

TRUST

Based on principal of trusteeship and HDFC AMC recognizes the immense trust placed in it by

its shareholders, employees and customers base and strives to live by the standards it has set for

itself, the standards that have made it what it is today.

INFORMAL WORKPLACE RELATIONSHIP

Informality in relationships at the workplace is the core of HDFC AMC culture. Here at HDFC

AMC is believed that Human resource is not the domain of the Human Resource Department

alone but also superior and hence of every superior – juniors share both a professional and

personal relationship. The superior is not only the person the junior reports into but is also a

guide, advisor and mentor.

COMMITTED, DILLEGENT AND ENTHUSIASTIC

HDFC SMC workplace environment is various and infused with enthusiasm and ambition.

• EMPLOYMENT TERMS

EEO
EEO is the policy and practice of the company to provide it to all the persons regardless of their

religion, caste, creed, gender or other factors. All the employees and applicants receive equal

consideration and treatment with respectively to employment, training, promotion,

compensation, transfer, layoff, recall, discipline termination and other conditions.

MENTORING

HDFC AMC understands the constant need of guidance and direction to employees. Every

superior acts as a mentor for all employees reporting into him. The mentor acts like a coach

provides constructive feedback which helps the subordinates to sheer their career in the right

direction.

EXCLUSIVE EMPLOYMENT

The employee position is that of full time employed with HDFC AMC. The company strictly

prohibits the employees from seeking employment of any nature with any other entity. The

employees have to take prior approval

from the superior and the Human Resource department before engaging in activities like

addressing seminars, teaching etc. and ensure that this official duties do not suffer on this

account and no monetary benefit is derived there from.

The employee or its relatives should also not be empanelled as an authorized / unauthorized

distributor / agent / broker or in any other similar capacity of any entity (including HDFC Mutual

Fund) engaged in distribution and selling of financial products.

RECRUITMENT POLICY
Recruitment & Selection

The upper level members like zonal managers, regional managers, branch managers and senior

executives are recruited by publishing recruitment advertisement in leading national level

newspaper. The qualified applicant are then called for interview and selected.

The regional manager has authority to select lower level employee like peon, marketing

executives, financial accountant etc. by approval of zonal manager.

RECRUITMENT PROCESS

Step 1: Prospecting

It consists of the following steps:

Generating leads of potential candidates

Contacting the leads and finding out their prima facie interest

Step 2: Attracting talent

Developing your own recruiting style

Developing a resource pool of talent

Creating interest in the potential advisor

Step 3: Selecting talent

Conducting an initial interview

Administrating the candidate

Final Selection interview is conducted by Managing Director.

TRAINING

Continuous training and upgrading technical, behavioural and managerial skills is a way of life

in HDFC AMC. HDFC AMC encourages agent or sub-broker to hone their skills regularly to

enable them to face the challenges of the changing requirements of customers that fit market up

and down.

Training needs analysis is done on a regular basis and systematic methodologies are ensured that

skills and capabilities of all agents are constantly upgraded to enable them to perform in the

challenging work. There is special training session at regular time period in local branch to all

financial consultant and agents about new scheme and to improve their effectiveness.
The successful candidates of the AMFI Exam are given the product training. The primary

purpose is to become quite conversant with the product that one sells. In other words, product

knowledge is very important for any advisor. Product knowledge is not just about knowing the

broad terms and conditions of the various schemes of mutual fund. The advisors are explained

about the schemes, the terms related with it, the benefits it provides to investor. This training is

aimed at making the advisors fully equipped with the companies’ product information. This

training is aimed at making the advisors experts in selling the mutual fund products.

This gives the advisors a systematic framework which they can follow so as to attract the

customers and be effective in their work. Later the agents are trained on products, need analyses

and how to deliver the message to the market.

PERFORMANCE APPRAISAL

Objective of Performance appraisal if for Developmental uses for agents and financial

consultants, for wages, transfer, promotion, for documentation and for organizational purpose

like Human Resource Planning, Job analysis and for training and development.

For Performance Appraisal modern method is used like MBO (Management by Objectives) and

360” appraisal. But there is some limitation like Hello effect, Bias, Perception factor, Spill over

etc.

FINANCIAL DETAILS

IMPORTANCE OF FINANCE

Finance is regarded as the life blood of a business enterprise. This is because in the modern

money oriented economy. Finance is the one of the basic foundation of all kind of electronic
activity. It is the master key which provides access to the entire source for being employed in

manufacturing and merchandizing activities. It has rightly been said the business needs money to

make more money. However it is also true that money begets more money, only when it is

properly managed. Hence, efficient management of every business enterprise is closely linked

with efficient management of its finance.

MEANING OF BUSINESS FINANCE

In general finance may be defined as the provision of money at the time it is wanted. However,

as a management function it has a special meaning. Finance function may be defined as the

procurement of funds and their effective utilization. Some of the authoritative definitions are as

follows:

“Business finance is that business activity which is concerned with the acquisition and

conservation of capital funds in meeting financial needs and overall objectives of far business

enterprise.”

“Business finance can broadly be defined as the activity concerned with planning rising,

controlling and administrating of the funds used in the business.”

MEANING OF FINANCIAL MANAGEMENT

From the various definition of the term business finance given above, it can be conclude that the

term business finance mainly involves, rising of funds and their effective utilization keeping in

view the overall objectives of the firm. This requires great caution and wisdom on the part of

management. The management makes use of various financial techniques, devices, etc. For

administrating the financial affairs of the firm in the most effective and efficient way. Financial
management, therefore, means the entire gamut of managerial efforts devoted to the management

of finance both its sources and uses of the enterprise.

According to somloman “financial management is concerne4d with the efficient use of an

important economic resource, namely, capital funds.” Phillipppatus has given a more elaborate

definition of the term financial management. According to him “financial management is

concerned with the managerial decisions that result in the acquisition and financing of long-term

and short-term credits for the firm. As such it seals with the situations that require selection of

specific assets (or combination of assets), the selection of specific liability (or combination of

liabilities) as well as the problem of size and growth of an enterprise. The analysis of these

decisions is based on the executed inflows and outflow of funds and their effects upon

managerial objectives.

Thus, financial management is mainly concerned with proper management of funds. The finance

manager must see that the funds are procured in a manner that the risk, cost and control

consideration are properly balanced in a given situation and there is optimum utilization of

funds.

EQUITY SCHEMES

• HDFC GROWTH FUND

Investment objective

The primary investment objective of the Scheme is to generate long term capital appreciation

from a portfolio that is invested predominantly in equity and equity related instruments.

Basic Scheme Information

Nature of Scheme Open Ended Growth Scheme

 Inception Date Sep 11, 2000

Option/Plan Dividend Option, Growth Option,

Entry Load. -In respect of each purchase / switch-in

(as a % of the Applicable NAV) of Units less than Rs. 5 crore in value, an

Entry Load of 2.25% is payable.

-In respect of each purchase / switch-in

of Units equal to or great than Rs. 5 crore

in value, no Entry Load is payable.

Exit Load. Nil

(as a % of the Applicable NAV)

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

Additional purchases is Rs. 1000 and in

multiples of Rs. 100 thereof

Lock-In-Period Nil

Net Asset Value Periodicity Every Business Day

Redemption Proceeds Normally despatched within 3 Business

days

Investment pattern

The corpus of the Scheme will be invested primarily in equity and equity related instruments.

The Scheme may invest a part of its corpus in debt and money market instruments, in order to

manage its liquidity requirements from time to time, and under certain circumstances, to protect

the interests of the Unit holders. The asset allocation under the Scheme will be as follows :
 SR TYPE OF INSTRUMENTS NORMAL RISK

NO. ALLOCATION PROFILE

(%of net asset)

1 Equities & Equities related 80-100 Medium to

instruments high

2 Debt securities, money market 0-100 Low to

instruments & cash medium

Investment Strategy & Risk Control

The investment approach will be based on a set of well established but flexible principles that

emphasise the concept of sustainable economic earnings and cash return on investment as the

means of valuation of companies. In summary, the Investment Strategy is expected to be a

function of extensive research and based on data and reasoning, rather than current fashion and

emotion. The objective will be to identify "businesses with superior growth prospects and good

management, at a reasonable price".

Benchmark Index : SENSEX

Fund Manager : Mr. Shrinivas Rao

• HDFC EQUITY FUND

Investment Objective

The investment objective of the Scheme is to achieve capital appreciation.

Basic Scheme Information

 Nature of Scheme Open Ended Growth Scheme

Inception Date Jan 01, 1995

Option/Plan Dividend Option, Growth Option,

Entry Load. In respect of each purchase / switch-

(as a % of the Applicable NAV) in of Units less than Rs. 5 crore in value,

an Entry Load of 2.25% is payable.

In respect of each purchase / switch-

in of Units equal to or great than Rs. 5

crore in value, no Entry Load is payable.

Exit Load. Nil

(as a % of the Applicable NAV)

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

Additional purchases is Rs. 1000 and in

multiples of Rs. 100 thereof

Lock-In-Period Nil

Net Asset Value Periodicity Every Business Day

Redemption Proceeds Normally despatched within 3 Business

days

Investment Pattern

The asset allocation under the Scheme will be as follows:

 SR NO. TYPE OF INSTRUMENTS NORMAL RISK

ALLOCATION PROFILE

(%of net asset)

1 Equities & Equities related 80-100 Medium to

instruments high

2 Debt securities, money market 0-100 Low to medium

instruments & cash

Investment in Securitised debt, if undertaken, would not exceed 20% of the net assets of the

scheme. The Scheme may also invest upto 25% of net assets of the Scheme in derivatives such as

Futures & Options and such other derivative instruments as may be introduced from time to time

for the purpose of hedging and portfolio balancing and other uses as may be permitted under the

Regulations.

Investment Strategy & Risk Control

In order to provide long term capital appreciation, the Scheme will invest predominantly in

growth companies. Companies selected under this portfolio would as far as practicable consist of

medium to large sized companies which: are likely achieved above average growth than the

industry; enjoy distinct competitive advantages, and have superior financial strengths.

The aim will be to build a portfolio, which represents a cross-section of the strong growth

companies in the prevailing market. In order to reduce the risk of volatility, the Scheme will

diversify across major industries and economic sectors.

Benchmark Index : S&P CNX 500. HDFC Equity, which is benchmarked to S&P CNX 500

Index is not sponsored, endorsed, sold or promoted by Indian Index Service & Products Limited

(IISL).

Fund Manager : Mr. Prashant Jain

• HDFC TAXSAVER

Investment Objective

The investment objective of the Scheme is to achieve long term growth of capital.

Basic Scheme Information

Nature of Scheme Open Ended Equity Linked Saving

Scheme

Inception Date Mar 31, 1996

Option/Plan Dividend Option, Growth Option,

Entry Load. In respect of each purchase / switch-in

(as a % of the Applicable NAV) of Units less than Rs. 5 crore in value, an

Entry Load of 2.25% is payable.

In respect of each purchase / switch-in

of Units equal to or great than Rs. 5 crore

in value, no Entry Load is payable.

Exit Load. Nil

(as a % of the Applicable NAV)

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

 Lock-In-Period 3 yrs

Net Asset Value Periodicity Every Business Day

Redemption Proceeds Normally despatched within 3 Business

days

Investment Pattern

The asset allocation under the Scheme will be as follows:

SR NO. ASSET TYPE (% OF RISK

PORTFOLIO) PROFILE

1 Equities & Equities Minimum 80% Medium to high

related instruments

2 Debt securities, money Minimum 20% Low to medium

market instruments &

cash

Investment in Securitized debt, if undertaken, would not exceed 20% of the net assets of the

scheme.

The Scheme may also invest up to 25% of net assets of the Scheme in derivatives such as Futures

& Options and such other derivative instruments as may be introduced from time to time for the

purpose of hedging and portfolio balancing and and other uses as may be permitted under the

regulations and guidelines.

The Scheme may also invest a part of its corpus, not exceeding 40% of its net assets, in overseas

markets in Global Depository Receipts (GDRs), ADRs, overseas equity, bonds and mutual funds
and such other instruments as may be allowed under the Regulations from time to time. The

ELSS (Equity Linked Savings Scheme) guidelines, as applicable, would be adhered to in the

management of this Fund. If the investment in equities and related instruments falls below 80%

of the portfolio of the Scheme at any point in time, it would be endeavoured to review and

rebalance the composition.

Benchmark Index :

S&P CNX 500. HDFC Tax saver, which is benchmarked to S&P CNX 500 Index is not

sponsored, endorsed, sold or promoted by Indian Index Service & Products Limited (IISL).

• HDFC TOP 200 FUND

Investment Objective

The investment objective is to generate long term capital appreciation from a portfolio of equity

and equity linked instruments. The investment portfolio for equity and equity linked instruments

will be primarily drawn from the companies in the BSE 200 Index. Further, the Scheme may also

invest in listed companies that would qualify to be in the top 200 by market capitalisation on the

BSE even though they may not be listed on the BSE This includes participation in large IPO’s

where in the market capitalisation of the company based on issue price would make the company

a part of the top 200 companies listed on the BSE based on market capitalisation.

Basic Scheme Information

Nature of Scheme Open Ended Equity Growth Scheme

 Inception Date Oct 11, 1996

Option/Plan Dividend Option, Growth Option,

Entry Load. In respect of each purchase / switch-in

(as a % of the Applicable NAV) of Units less than Rs. 5 crore in value, an

Entry Load of 2.25% is payable.

In respect of each purchase / switch-in

of Units equal to or great than Rs. 5 crore

in value, no Entry Load is payable.

Exit Load. Nil

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

Additional purchases is Rs. 1000 and in

multiples of Rs. 100 thereof.

Lock-In-Period Nil

Investment Pattern

The asset allocation under the Scheme will be as follows:

SR NO. ASSET TYPE (% OF PORTFOLIO) RISK

PROFILE

1 Equities & Equities Upto 100% (including use Medium to high

related instruments of derivatives for hedging

and other uses as permitted

by prevailing SEBI
 Regulations)

2 Debt securities, money Balance in Debt & Money Low to medium

market instruments & Market Instruments

cash

Investment in Securitised debt, if undertaken, would not exceed 20% of the net assets of the

scheme. The Scheme may also invest upto 25% of net assets of the Scheme in derivatives such as

Futures & Options and such other derivative instruments as may be introduced from time to time

for the purpose of hedging and portfolio balancing and other uses as may be permitted under the

regulations and guidelines.

Investment Strategy & Risk Control

The investment strategy of primarily restricting the equity portfolio to the BSE 200 Index scrips

is intended to reduce risks while maintaining steady growth. Stock specific risk will be

minimised by investing only in those companies / industries that have been thoroughly

researched by the investment manager's research team. Risk will also be reduced through a

diversification of the portfolio.

Benchmark Index : BSE 200

Fund Manager : Mr. Prashant Jain

• HDFC MID-CAP OPPORTUNITIES FUND

Investment Objective
To generate long-term capital appreciation from a portfolio that is substantially constituted of

equity and equity related securities of Small and Mid-Cap companies.

Basic Scheme Information

Nature of Scheme Close Ended Equity Scheme

Inception Date May 07, 2009

Option/Plan Growth Option. Dividend Option (with Payout

Facility only).

Entry Load Nil

(as a % of the Applicable

NAV)

Exit Load Nil

(as a % of the Applicable

NAV

Minimum Application Rs.5000 and in multiples of Re.1000 thereafter

Amount

Lock-In-Period Nil

Net Asset Value Periodicity Every Business Day

Redemption Proceeds Within 10 working days.

Investment Pattern

The asset allocation under the Scheme will be as follows:

SR NO. ASSET TYPE (% OF RISK

PORTFOLO) PROFILE

1 Equities & Equities related Upto 100% HIGH

instruments

2 Debt securities, money market Not more than Low to medium

instruments & cash 25%

3 Equity and equity related 100 % HIGH

securities of Small and Mid-Cap 15 %

companies of which Small-Cap 95 %

companies Mid-Cap companies

The Investment in Securitised Debt will not normally exceed 25% of the net assets of the

Scheme.

The Scheme may seek investment opportunity in the ADR / GDR / Foreign Equity and Debt

Securities (max. 25% of net assets). The Scheme may take derivatives position for hedging and

portfolio balancing (max. 20% of the net assets) based on the opportunities available subject to

SEBI Regulations.

Fund Manager

MR. CHIRAG SATELVAD

MR. ANAND LADDHA

BALANCED SCHEMES

• HDFC BALANCED FUND

Investment Objective

The primary objective of the Scheme is to generate capital appreciation along with current

income from a combined portfolio of equity and equity related and debt and money market

instruments. Basic Scheme Information

Nature of Scheme Open Ended balanced Scheme

Inception Date Sep 11, 2000

Option/Plan Dividend Option, Growth Option,

Entry Load. In respect of each purchase / switch-in

(as a % of the Applicable NAV) of Units less than Rs. 5 crore in value, an

Entry Load of 2.25% is payable.

In respect of each purchase / switch-in

of Units equal to or great than Rs. 5 crore

in value, no Entry Load is payable.

Exit Load. Nil

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

 Additional purchases is Rs. 1000 and in

multiples of Rs. 100 thereof.

Lock-In-Period Nil

Net Asset Value Periodicity Every Business Day

Investment Pattern

The Scheme will be invested in equity and equity related instruments as well as in debt and in

money market instruments in normal circumstances. The following table provides the asset

allocation of the Scheme’s portfolio.

The asset allocation under the Scheme will be as follows:

SR TYPE OF Normal Allocation (% Normal Deviation RISK

NO. INSTRUMENT of Net Assets) (% of Normal PROFILE

Allocation)

1. Equity & Equity 60 20 Medium to

related high

instruments

2. Debt securities & 40 20 Low to

Money Market medium

instruments)
Investment Strategy & Risk Control

The balanced product is positioned as a lower risk alternative to a pure equities scheme, while

retaining some of the upside potential from equities exposure. The Scheme provides the

Investment Manager with the flexibility to shift allocations in the event of a change in view

regarding an asset class. Asset allocation between equities and debt is a critical function in a

balanced fund. It is proposed to continuously monitor the potential for both debt and equities to

arrive at a dynamic allocation between the asset classes.

The equity and debt portfolios of the Scheme would be managed as per the respective investment

strategies detailed herein. The investment approach would be based on the concept of economic

earning power and cash return on investments

Risk control

The overall portfolio structure would aim to maintain risk at a moderate level. The Fund

Manager would avoid adopting either a very defensive or aggressive posture at any point in time.

Risk will also be controlled through portfolio diversification and a conscious focus on

maintaining adequate levels of liquidity at all points in time. Macro economic risk will be

addressed through a constant review of the business and economic environment. The AMC may

from time to time, review and modify the Schemes? Investment strategy if such changes are

considered to be in the best interest of Unit holders and appropriate to the existing market

situation. Investments in securities and instruments not specifically mentioned earlier may also

be made, provided they are permitted by SEBI Regulations.

Benchmark Index: CRISIL Balanced Fund Index

• HDFC PRUDENCE FUND

Investment Objective

The investment objective of the Scheme is to provide periodic returns and capital appreciation

over a long period of time, from a judicious mix of equity and debt investments, with the aim to

prevent/ minimise any capital erosion. Under normal circumstances, it is envisaged that the debt :

equity mix would vary between 60:40 and 40:60 respectively. This mix is geared to achieve the

investment objective and is expected to result in regular income, capital appreciation and also

prevent capital erosion.

Basic Scheme Information

Nature of Scheme Open Ended balanced Scheme

Inception Date Feb 01, 1994

Option/Plan Dividend Option, Growth Option,

Entry Load. In respect of each purchase / switch-in

(as a % of the Applicable NAV) of Units less than Rs. 5 crore in value, an

Entry Load of 2.25% is payable.

In respect of each purchase / switch-in

of Units equal to or great than Rs. 5 crore

in value, no Entry Load is payable.

Exit Load. In Respect of each purchase/ switch in an

(as a % of the Applicable NAV) Exit load of 1% is payable if Units are

redeemed / switched out within 1 year

 from the date of allotment.

Minimum Application Amount Rs.5000 and in multiples of Rs.100

thereof to open an account / folio.

Additional purchases is Rs. 1000 and in

multiples of Rs. 100 thereof.

Lock-In-Period Nil

Net Asset Value Periodicity Every Business Day

Redemption Proceeds Normally despatched within 3 Business

days

Investment Pattern

The asset allocation under the Scheme will be as follows:

SR NO. ASSET TYPE (% OF RISK

PORTFOLIO) PROFILE

1 Equities & Equities related Upto 100% Medium to high

instruments

2 Debt securities, money Not more than Low to medium

market instruments & cash 20%

Investment in Securitised debt, if undertaken, would not exceed 10% of the net assets of the

scheme. In such times when the interest rates are high, investment in debt would be more

attractive versus equities and accordingly the Fund is likely to increase the debt component in the

Scheme's portfolio. Similarly in times when the interest rates are low and the equity valuations

are cheap, the Scheme is likely to reduce exposure to debt and increase exposure to equities. In
addition to debt and equities the scheme will also invest in money market instruments. The exact

proportion in money market instruments will be a function of the liquidity needs and the

attractiveness of the debt/ equity markets. At times when neither the debt market nor equities are

attractive for investment, more resources may be temporarily invested in money market

investments to be invested in debt/ equities at a more appropriate time.

Investment Strategy & Risk Control

As outlined above, the investments in the Scheme will comprise both debt and equities. The

Fund would invest in Debt instruments such as Government securities, money market

instruments, securitised debts, corporate debentures and bonds, preference shares, quasi

Government bonds, and in equity shares

Benchmark Index : CRISIL Balanced Fund Index

RESEARCH METHODOLOGY

RESEARCH METHODOLOGY
Research methodology is a systematic way, which consists of series of actions or steps necessary

to effectively carry out research & the desired sequencing of these steps. The marketing research

is a process of involves a number of inter-related activities, which overlap & do rigidly follow a

particular sequence. It consists of the following steps:

• Formulating the objective of the study

• Designing the methods of data collection

• Selecting the sample plan

• Collecting the date

• Processing & analyzing the data

• Reporting the findings

RESEARCH DESIGN

Research Design specifies the methods & procedures for conducting a particular study.

A research design is the arrangement of conditions for collection & analysis of the data in a

manner that aims to combine relevance to the research papoose with economy in procedure.

Research design is broadly classified into three types as:

• Exploratory Research Design

• Descriptive Research Design

• Hypothesis testing Research Design

On the basis of the objective of study, the studies which are concerned with describing the

character tics of a particular individual, or a of a group of individual under study comes under

exploratory Research Design

EXPLORATORY RESEARCH DESIGN

Exploratory Research is also termed as formulate research studies. The main purpose of such

studies is that of formulating the problem for more precise investigation .the major emphasis in

such studies is on the discovery of new ideas & insights.

Since our aim is to obtain complete & accurate information in the said studies, the procedure to

be used is carefully planned. The Research Design make enough provision for protection against

bias & must maximize reliability, with due concern for the economical completion of the

research study.

Sampling design

It is needless to say that no investigator can study the entire population & hence selects a few

individuals belonging to the populations for the purpose of investigation

A sample design is a definite plan for obtaining a sample from a given population. It refers to the

technique or the procedure adopted in selecting items for the sample .the main constituents of the

sampling design are as below:-

• Sampling Unit

• Sample Size

• Sampling Procedure

• Collection of Data
Sampling unit

A sampling framework i.e. developed for the target population will be sampled i.e. who is to

• Retailers & Distributors of PCs

It is the substantial portion of the target population that is sample to achieve reliable results.

I have taken 55 retailers & distributors as a sample.

Sampling Procedure

The procedure to choose the respondents to obtain a representative sample, a probability

sampling technique is applied for the target-market.

Non – Probability Sampling

It is a purposive sampling which deliberately chooses the particular units of the universe for

constituting a sample on the basis that the small mass that they so select out of a huge one will be

typical or representative of the whole. Now probability sampling technique is used in the study

because the random selection of the universe i.e. all retailers can’t be available randomly.

DATA COLLECTION

Primary data

The primary data are those data that are collected a fresh & for the first time. And happen to be

original in character. The primary data to be collected for the study are:

• Recruitment of Financial Advisor

• By Structured Questionnaire.

Secondary data
Secondary data are those data which have already been collected by someone else & which

already had been passed through the statically process. The secondary data to be collected for

the study are:-

• Publication of the company

• Periodical of the company

• By companies websites

RESEARCH INSTRUMENT

Structured questionnaire:

A questionnaire consists of a number of questions printed or typed and a definite order on a form

or set of forms. It is the setoff questions presented to the respondents for their answers.

When the questions have only two alternatives or of multiple choices, then it is known as close

enSd questionnaire, which is hence used to given study.

Research Step

Step-1

The topic “recruitment of financial advisor” was selected & a synopsis containing the tile of the

organization & objective was prepared.

Step-2

A questionnaire is prepared of retailers consists of objective type questions; & given to the

respondent.

Step-3
The questionnaire was circulated to a random sample of 55 retailers in order to find out answers

to the given questions.

Step-4

The researcher for data analysis collected the questionnaire duly filled by the respondents.

Step-5

After going through the entire questionnaire, researcher is able to find out various aspects related

with topic.

DATA ANALYSIS & INTERPRETATION

DATA ANALYSIS & INTERPRETATION

Satisfaction level of services about HDFC

Satisfaction level of other services

Majority of the population (50%) , when they think of insurance it means LIC where as 20% &

30 % of the population think it as tax saving & security espectively .thus it can be seen that LIC

is well based in the minds of the people.

Have you ever invested/ interested to invest in mutual funds?

YES 135
NO 65

Where do you find yourself as a investor?

Totally ignorant 28
Partial knowledge of MFs 37
Aware of only scheme in which invested 46
Good knowledge of MFs 24

Where from you purchases mutual funds?

Directly from the AMCs 33

Brokers only ( large intermediaries) 28
Broker/ sub-brokers 59
 Other sources 15

CONCLUSION

CONCLUSION

This report is prepared to get the basic ideas of mutual fund and various schemes of HDFC. The

general concept of the market study will help the different individuals to invest in different

investment tools as per their appetite. Through research study, it is very much visualized the

present market trend opted by the selected number of people and their perception regarding

Mutual Fund.

Hence, from this report I conclude that people are keener to invest in Mutual Fund due to the

stability and getting more diversified options.

 RECOMMENDATION

RECOMMENDATION

• An aggressive advertising campaigning should be there to encourage more people to invest.

• As some of the people think that mutual fund is risky so the company should show people

the advantages of the mutual fund and how it is better than the other investment avenues.

• There is a great potential for the mutual fund because the people are ready to invest in the

mutual fund as there is a positive responses.

• Now a days people are investing in more of an equity fund because it gives high return as

compare to other mutual fund schemes.

• People are preferred to invest in the long term savings when only they have enough of

surplus. They are least concerned about the other’s advice.

• The people of Rajkot have enough purchasing power supported by N.R.I. Mutual Fund

Companies should take this fact positively at the time of designing promotional scheme.

• HDFC MF is doing comparatively very less marketing in MF industry in compare to other

players. Due to this other player are getting the advantage. Thus it should try to increase the

marketing and advertising related activities time to time or at least at the time of new

NFO’s, at the time when they are declaring dividends or at the peak time (i.e. January -

March) last quarter of financial year when people are searching for investing instruments.

• A very small part market has been cover by HDFC MF. It can increase the circle of its

business in small and rural areas of every state and cities of India where they an find a huge

business.

• To uproot the investment level the company should give training programme to financial

agents who approach the investor for the investments. And they should be aware of all the

benefits of the mutual Funds.

• Company should undertake the Campaign, Road shows, Advertisement and other type of

Publicity for the effective awareness of different schemes that are available in the market.

• The company should arrange seminars and presentations, giving detail idea about securities

and benefits of investment in mutual fund.

 ANNEXURE

• CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED

MARCH 31, 2022

• BALANCE SHEET AS ON MARCH 31, 2022

• CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2022

• QUESTIONNAIRE

• BIBLIOGRAPHY

• RANKING OF SAMPLE SCHEMES

ANNEXURE

Consolidated Profit and Loss Account for the year ended March 31, 2022

March 31, 2022 March 31, 2020

BALANCE SHEET AS ON MARCH 31, 2022
 Rupees Rupees(2022) Rupees(2020)

FUNDS EMPLOYED

SHAREHOLDER’S FUNDS

Share Capital 1 50,16,10,000 50,16,10,000

Reserves and Surplus 2 59,54,32,963 37,00,04,035

109,70,42,963 87,16,14,035

APPLICATION OF FUNDS

FIXED ASSETS 3

Gross Block 81,70,23,962 79,49,92,631

Less: Depreciation 19,28,39,455 12,62,51,492

Net Block 62,41,84,507 66,87,41,139

Capital Advances 3,25,993 11,15,856

63,05,10,500 66,98,56,995

INVESTMENTS 4 51,36,82,426 33,26,90,199

DEFERRED TAX ASSET 5 4,64,76,435 1,24,04,535

CURRENT ASSETS,

LOANS

AND ADVANCES

Sundry Debtors 6 5,94,48,534 2,42,20,249

Cash and Bank Balances 7 1,14,77,426 1,01,93,726

Other Current Assets 8 6,027 4,823

Loans and Advances 9 67,95,60,821 31,47,04,320

 75,04,92,808 34,91,23,118

Less: CURRENT

LIABILITIES AND

PROVISIONS

Current Liabilities 10 19,97,83,840 17,39,08,663

Provisions 11 64,43,35,366 31,85,52,149

84,41,19,206 49,24,60,812

NET CURRENT ASSETS (9,36,26,398) (1433,37,694)

109,70,42,963 87,16,14,035

CASH FLOW STATEMENT FOR THE YEAR ENDED MARCH 31, 2022

Rupees(2013) Rupees(2012)

• CASH FLOW FROM OPERATING

ACTIVITIES

Profit before taxation and extraordinary items 70,05,12,090 49,33,12,324

Add / (Less) : Adjustment for Depreciation 6,83,28,410 6,65,90,054

Profit on sale of investment (net) (16,81,892) (1,00,75,602)

(Profit) / Loss on sale of fixed assets (net) (3,62,004) (10,48,315)

Investment Income (dividend) (1,82,62,800) (1,65,99,156)

Provision for wealth tax 75,472 62,998

Operating Profit before working capital changes 74,86,09,276 53,22,42,303

(Increase) / Decrease in Loans and Advances (9,21,49,302) (1,32,43,781)

(Increase) / Decrease in Other Current Assets (1,204) 2,349

(Increase) / Decrease in Sundry Debtors (3,52,28,285) (83,46,683)

Increase / (Decrease) in Current Liabilities 11,83,75,177 71,39,908

Cash generated from Operations 73,96,05,662 51,77,94,096

Income tax paid (27,62,84,709) (16,24,85,230)

Net cash from operating activities 46,33,20,953 35,53,08,866

• CASH FLOW FROM INVESTING

ACTIVITIES

Purchase of fixed assets (2,91,99,454) (4,58,05,383)

Proceeds from sale of fixed assets 5,79,543 17,42,848

Purchase of investments (48,14,67,068) (118,75,61,739)

Proceeds from sale of investments 132,04,19,533 128,67,69,273

Net cash used in investing activities (18,96,67,446) 5,51,44,999

• CASH FLOW FROM FINANCING

ACTIVITIES

Share Capital - Preference — (25,00,00,000)

Dividend paid (23,88,68,500) (14,03,01,535)

Tax paid on Dividend (3,35,01,307) (1,83,35,658)

Net cash from financing activities (27,23,69,807) (40,86,37,193)

Net Increase / (Decrease) in cash and cash

equivalents 12,83,700 18,16,672

Cash and cash equivalents at the beginning

of the yea 1,01,93,726 83,77,054

Cash and cash equivalents at the end of the year 1,14,77,426 1,01,93,726

12,83,700 18,16,672