A SURVEY REPORT

ON
STUDY ON INVESTMENT PATTERN OF SALARIED EMPLOYEE
IN VARANASI
Project report submitted for the award of
MASTER OF BUSINESS ADMINISTRATION

(Approved by the AICTE, Ministry of HRD Government of India, New Delhi)

SESSION 2015-16
PROJECT GUIDE:
MR.KARTIKEYA SINGH
Assistant Professor
SMS Varanasi

SUBMITTED BY:
AKHILESH KUMAR
MBA/03/007
2nd Sem.

SCHOOL OF MANAGEMENT SCIENCEs, VARANASI

ACKNOWLEDGEMENT
Before I thank anybody for the compilation of this work I
would like to thank almighty for providing me guidance and
strength. It is his grace only that I have completed this work.
It is my pleasure to thank all who helped me directly or
indirectly in preparation of this field survey report. It was very
exciting for me to work on the
STUDY ON INVESTMENT PATTERN OF SALARIED EMPLOYEE
IN VARANASI

During this field survey I have gained practical as well as theoretical

knowledge of great significance. I am grateful to the SCHOOL OF
MANAGEMENT SCIENCES VARANASI for providing me
opportunity to work in the external environment as well as providing
an excellent internal guidance for the completion of my survey report.
I am thankful to our Director Prof P.N. JHA for his blessings to
accomplish my work and to the MBA Coordinator Mr. Kartikeya

Singh for his necessary support and cooperation.. I am also thankful

to all faculty members of college for their guidance and contribution
in the work. At last I am very much thankful to everyone who
supported me, and my family for their patience and cooperation.

AKHILESH KUMAR

DECLARATION
I AKHILESH KUMAR hereby declare that the report entitled,
STUDY ON INVESTMENT PATTERN OF SALARIED EMPLOYEE
IN VARANASI
is a project work carried out by me independently. The information presented
done is correct to the best of knowledge and the analysis is as per the norms and
guidelines provided for the report. I have utilized the requisite concepts and
applied the required methodologies to analyse the data collected to reach the
conclusion present in the report.
I claim the report to be my indigenous work and have not been presented
anywise for any purpose, what-so-ever.

AKHILESH KUMAR

Date:

SMS, VARANASI

Place: Varanasi

TABLE OF COTENTS

Particulars
1 Introduction
2 Research Objective
3 Research Methodology
4 Data Analysis
5 Conclusion
6 Implication
7 limitation
8 Recommendation
9 Appendix
10 Bibliography

Page No.

INTRODUCTION

In Mutual Fund organizations, mutual fund trust

appoints Asset Management
Company (AMC) to look after the funds of trustees of
mutual funds. The AMC is in
charge of funds management and allocation of assets of
unit holders. Such allocation of
assets is nothing but a judicious investment of
resources mobilized from investors.
Resource mobilization patterns and projections for
mutual fund industry and factors
influencing resource mobilization were discussed in
Chapter-3.
In this context, this chapter is intended to examine the
trends in investments by

mutual fund organizations in India across various

schemes, financial instruments. The
changes in investment pattern during the postliberalization period i.e. 1993-2009 are also
examined. This also focuses on guidelines issued by
SEBI and AMFI with respect to
investment practices of mutual fund organizations.
Finally, contribution to mutual funds
by various categories of investors is presented across
important categories of schemes
suggested by AMFI.
4.1. SEBI guidelines on Investment pattern of mutual
fund:
Securities Exchange Board of India (SEBI) formulates
policies and regulates the
mutual funds. It notified regulations in 1993 (fully
revised in 1996) and issues guidelines
from time to time. MF either promoted by public or by
private sector entities including
one promoted by foreign entities are governed by these
Regulations.
The notification of the SEBI (Mutual Fund) Regulations
of 1993, brought about a

restructuring of the mutual fund industry. An arms

length relationship is required
between the fund sponsor, trustees, custodian, and asset
management company. This is in
contrast to the previous practice where all three
functions, namely trusteeship,
custodianship, and asset management, were often
performed by one body, usually the
fund sponsor or its subsidiary. The regulations
prescribed disclosure and advertisement
norms for mutual funds, and, for the first time,
permitted the entry of private sector
mutual funds. FIIs registered with SEBI may invest in
domestic mutual funds, whether
listed or unlisted.
The 1993 Regulations have been revised on the basis of
the recommendations of
the Mutual Funds 2000 Report prepared by SEBI. The
revised regulations strongly
emphasize the governance of mutual funds and increase
the responsibility of the trustees
in overseeing the functions of the asset management
company. Mutual funds are now

required to obtain the consent of investors for any

change in the fundamental attributes
of a scheme, on the basis of which unit holders have
invested. The revised regulations
require disclosures in terms of portfolio composition,
transactions by schemes of mutual
funds with sponsors or affiliates of sponsors, with the
asset management company and
trustees, and also with respect to personal transactions
of key personnel of asset
management companies and of trustees.
SEBI approved Asset Management Company (AMC)
manages the funds by
making investments in various types of securities.
Custodian, registered with SEBI, holds
the securities of various schemes of the fund in its
custody. The general power of
superintendence and direction over AMC is vested with
the trustees.
According to SEBI Regulations, two thirds of the
directors of Trustee Company or board
of trustees must be independent. They should not be
associated with the sponsors. 50% of

the directors of AMC must be independent. All mutual

funds are required to be registered
with SEBI before they launch any scheme. Increase of
load more than the level
mentioned in the offer document is applicable only to
prospective investments by the
MFs. For original investments, the offer documents
have to be amended to make
investors aware of loads at the time of investments.
The investment pattern varies according to scheme and
it has to follow stipulated
norms by SEBI from time-to-time. Considering the
market trends, any prudent fund
managers can change the asset allocation i.e. he can
invest higher or lower percentage of
the fund in equity or debt instruments compared to what
is disclosed in the offer
document. It can be done on a short term basis on
defensive considerations i.e. to protect
the NAV. Hence the fund managers are allowed certain
flexibility in altering the asset
allocation considering the interest of the investors. In
case the mutual fund wants to

change the asset allocation on a permanent basis, they

are required to inform the
unitholders and giving them option to exit the scheme at
prevailing NAV without any
load.

The mutual funds are required to disclose full portfolios

of all of their schemes on
half-yearly basis which are published in the
newspapers. Some mutual funds send the
portfolios to their unit holders. The scheme portfolio
shows investment made in each
security i.e. equity, debentures, money market
instruments, government securities, etc.
and their quantity, market value and % to NAV. These
portfolio statements also required
to disclose illiquid securities in the portfolio, investment
made in rated and unrated debt
securities, non-performing assets (NPAs), etc.
4.2. Restrictions on Investments:

Schedule VI of SEBI (Mutual Funds) Regulations

1993deals with Restrictions
on Investments vide Regulation 41 of the SEBI. The
following are the important
restrictions:
Debt instruments should be rated as investment
grade by a credit rating agency.
Credit rating agencies are CRISIL, ICRA etc. If the
debt instruments is not rated,
the specific approval of the board of Asset Management
Company should be
taken for investment.
No term loans for any purpose may be advanced by
Mutual funds
Investments by way privately placed debentures,
securitized debts and other
unquoted debt instruments shall not respectively exceed
10 per cent of the total
assets of the relevant scheme in case of income scheme.
No individual scheme of the mutual fund should
invest more than 5 per cent of its
corpus in any one companys shares.

 No mutual fund under all it should own more than 5

per cent of any companys
paid up capital carrying voting rights.

No mutual fund under all its schemes taken together

should invest more than 10
per cent of the funds in the shares, debentures or other
securities of a single
company.
No mutual fund under all its schemes taken together
should invest more than 15
per cent of its funds in the shares and debentures of any
one industry.
4.3. Instruments of Investment:
There are various financial instruments for investment
by mutual fund
organizations to reap returns in turn distribute the same
in the form of dividend or interest
to their unit holders i.e., investors.
1. Equity shares
2. convertible debentures

3. Fixed Income securities:

3.a. Debt Instruments i.e., non-convertible debentures
3.b. Bonds of public sector., and
3.c. Government Securities of Gilt
4. Money Market Instruments:
4.a. Certificate of Deposits
4.b. Treasury Bills
4.c. Bill discounting
4.d. Commercial paper
4.e. Call Money
124
4.4. Investment Mix:
It is known fact that the investment pattern of mutual
fund scheme is governed by
the type of scheme. A growth scheme would have a pre
dominant accent on equities. For
an income scheme, high degree of investment in debt
instruments is required to generate
a steady flow of return to investors. In case any offer
document of a scheme, it stand to

reason that the equity element would be still lower.

Such situation takes place in the case
of monthly income schemes.
4.5. INVESTMENT PATTERNDURING 1993-2009:
A detailed break-up of security-wise investment pattern
of all mutual funds during
Post-liberalization period is exhibited in table 4.1,
which indicates that unexpected
growth in bank deposits in case of private sector as well
as public sector by mutual fund
investment companies during the last 16 years. Average
annual growth rate is very high
for the CD/CPs and bank fixed deposits i.e 1280 per
cent and 6720 per cent of average
annual growth rate. The data also shows that mutual
funds are relying more on fixed
returns than that of equity shares and debentures.
Investment in Equity shares
component is decreased from 49 per cent in 1993-94 to
34 per cent by the year 2008-09.
In case of investment relating to debentures also
declined from 26.51 per cent in 1993

94, to 17.40 per cent by the year 2008-09. Similarly

investment in government treasury
bills also declined marginally

Q1. You belong to which one of the following category:

?

a. Govt. Employee
b- Professional Pvt.
c. Firm Employee
d. Self Employed

58
12
15
15

d; 12%

c; 15%

a; 58%
b; 15%

INTERPRITATION:-in above chart there that are 58% empl. Of

government

Q2 Your annual income is in the range of:

a) Below Rs. 1 Lakh
b) Between

1 Lakh to 2 Lakh

25
15

c) Between 2 Lakh to 3 Lakh

d) Between 3 Lakh to 4 Lakh

17%

43
17

25%
a
b

15%
43%

c
d

INTERPRETATION: from the above finding we can

interpret that most of the employee which in 43% are in
Favour the use of these services.

Q3.what is currently your monthly budget for these services?

a)less than
b)from 20 to 30
c)from 50 to 100
d)from100 to 150

24
6
22
5

25

20

15

10

INTERPRETETION: Maximum No. of respondent

having positive feeling for less than follow by the
budget of the services.

Q4. Where do you invest your savings?

a) Savings Bank

45

b) Fixed Deposit

15

Chart Title

45
40
35
30
25
20
15
10
5
0

INGTERPRETETION: from the above finding 45% of

Responding only branded thing.

Q5. What are the factors to which you give priority when you
invest ?

a . Safety
b . High Return
c . Liquidity
d . Less Risk

17
20
16
7

12%
28%
a

27%

b
c
d

33%

INGTERPRETETION: from the above finding 33% of

Responding only employee to highly agree to the friend.
Q6. How is your invest pattern :

a. Monthly (SIP)
b. Once in Six Months
c. Once in a year
d. Very Rare

14
39
6
1

40
35
30
25
20
15
10
5
0

INTERPRETETION: Maximum No. of respondent

having positive feeling for the internet for the services.

Q7. You have invested in which type of Mutual Fund Scheme

?
a Equity fund
b. Debt funds
c. Hybrid Funds
d. other

17
27
9
7

12%
28%
15%
a
b
c
d

45%

INTERPRETETION: From the above finding we can

interpret that most of the employee which in 45% are in
Favour of the shopping is risky.
Q8. If Equity Funds then, in which category ?

a. Diversified Equity Funds

b. Mid-Cap Funds
c. Sector Specific Funds

15
33
4

d. Tax Savings Funds

35
30
25
20
15
10
5
0

INGTERPRETETION: from the above diagram finding that

33 % of people is responding only secure traditional shopping
which are mostly mid cap fund.

Q9.Necessity of having a bank account and credit card creates

difficulties?

a. agree
b. strongly agree
c. strongly disagree
d. disagree

13
28
15
4

30

25

20

15

10

INTERPRETETION:

Maximum No. of respondent

Having positive feeling for the having a bank account and
credit card creates difficulties.

Q10. If Debt Funds then, in which category ?

a. Gilt Funds

19

b. Income
c. Funds MIPs
d. Short Term Plan

15
14
12

20
18
16
14
12
10
8
6
4
2
0

INTERPRETETION: in this diagram maximum customer is

agree to the gift fund from the pay for investment.

CANCLUSION

This study is to identify the potential of online sales on

Penang fruit pickles by examining

The attitudes of potential customers towards such alternative

way of shopping. It also
Investigated the relationships between attitude and Behavioral
intention to make a
Purchase on such product through online shopping. In
addition, this study also examines
Tether demographic profile (gender, age, education level,
income, employees, location), previous experience, perceived
benefits, employee income,
Perceived merchants trustworthiness influence employee
attitude in adopting on Penang fruit pickles. This study tries to
capture the inter-relationship of all
The said dependent and independent variables by applying the
theory of reasoned action
(TRA). The result of this study indicated that consumers
showed positive intention to be
Strongly and positively correlated which fitted well in the
TRA model. The review of the
Remaining hypotheses shows that the attitude is also
correlated moderately or strongly
And positively with the identified factors. The most
significant factor is the perceived
Benefits of online shopping, followed by perceived
merchants trustworthiness,
Consumers lifestyle and lastly consumers prior e-commerce
experience. Although the demographic profiles are variables
which have significant effects on the attitudes as
Evident by various previous researches, this study found
otherwise and concluded that
Demographic profiles are not significant at all in influencing
the attitude in the context of this study. The reason for this
could be it is not an expensive product and every working

Adults can afford it regardless of income level, age and

gender as long as they like the
Products. The education level becomes irrelevant as long as
the consumers are internet
Users and are familiar with the e-commerce environment.
Besides, the types of residential
Area also become not relevant as long as there is internet
access available anywhere. In
Addition, it is also found that there is no significant effect by
the frequency of online
Shopping and the duration of daily internet usage. This may
due to once consumers have
Exposure to Internet and e-commerce environment, these two
variables become redundant.

IMPLICATION

This study will enrich the literature on the online shopping in

Malaysian context using
Theory of Reasoned Action (TRA) model. First of all, the
result of the study can serve as an indication or trend not only
certain products can be sold through online but can cover a

Much wider ranges in Malaysian context. Secondly, it is

expected that result from this
Study can help online retailers to draw further marketing
strategy to attract more
Consumers through online shopping under Malaysian context.
They can know their
Weaknesses and try to improve or change their business
1strategy so that they can attract
More online buyers to visit their website and buy their
products or services. As benefits
Perception is the most significant influencing factors on
attitude, one of the important implications of this study to
practice is that the merchant needs to ensure that the
Websites to be developed to facilitate online shopping and be
easy to use by the
Consumers and must be able to demonstrate the benefits of
shopping online to consumers.
Thirdly, the survey revealed that consumers have strong
preference for trustworthy online
Store. This is consistent with findings by Chua et al (2006)
who concluded online consumers in Malaysians still lack
confidence and trust in utilizing the Internet as a
Shopping channel as they are very concerned about issues
related to privacy and trust
When dealing with online retailers. As such, an online store
merchant of similar nature
Can make use of such info to improve their website design
and devise their marketing
Strategy in promoting their online store. In the Internet
marketing context, Internet
employee will favour sites that represent a merchant with
which the consumer is already

Familiar from traditional channels. As such, the merchant

should actively promote their
Online channel option to their existing customers who
frequently visit their current retail
Store. This is because the reputation of the physical store will
most likely influence the
Perceptions of an online site. Concurrently, in order for
consumers to engage in trust related
Internet behaviour like this online shopping, the merchant
must make trust-building
Interventions such as posting a privacy policy, use a thirdparty seal, interact with
employee, advertise its good reputation, link to other
reputable sites, or offer guarantees
on product delivery and quality. It is also very important for
Internet merchants to ensure
that consumers have a positive shopping experience each time
the consumer visits their
online stores. Additional purpose is to convert fruit pickles
from experience product to
search product.
52
In addition, it also indicated that there are opportunities out
there where many people can
become entrepreneurs or technopreneurs as encouraged by the
government, without
heavy investment compared to traditional retailers. Malaysian
government is improving
broadband penetration as well as sustainable mobile Internet
coverage nationwide. Last
but not least, this study is useful for the academicians where
current study could serve as

A reference and guides for the future researchers who would

like to study about the
Similar topic.

LIMITATION

Firstly, the survey respondents were dominated by the

respondents from Kelantan, the
Results of this study could be biased towards the consumers
of this particular state.
However, it is expected that Kelantan consumers would not
behave very differently from
Those in other States of this country. Thus, this should not by
any means invalidate the

Generalizability of the findings. Secondly, the sample size is

rather small and not
Randomized as the sampling method used was convenient
sampling which could impose
Possible bias by answering the questions in Favours of the
researcher and not reflecting their
True perception. Thirdly, the ethnic group also dominated by
Malay only which could be a
Source of bias too. However, in this fruit pickles market, it is
the researcher valid
Understanding that Malay makes up of more than 80% of the
market. The result obtained
Can still be valid among the Malay ethnic group but has
limitation to be generalized to
Others. Fourthly, the website design appears to be very
important but not evaluated in this
Survey. This is because consumers perceived benefits and
trustworthiness to be very
Important in their evaluations and website design could be
highly correlated with them
And ultimately to attitude and behavioural intention. Lastly,
many respondents a bandied the survey half-way through
resulting in many incomplete responses which were
Discarded from this study. This can indicate that there is
possibility that some respondents
Did not answer with their true view but simply for the sake of
completing the survey.

RECOMONDATION

It is hoped that this study will be able to stimulate future

research interests in the area of E-commerce.
It is recommended to include detailed website design to be
evaluated by Consumers in future.
In order to reap the maximum benefits of future research, the
Website must have been improvised to include all the
necessary features that have been Discussed or even more .
The potential participants can be invited to take part in the
Survey through the actual website so that they can evaluate
and visualize the features,

Benefits, ease of use, security, trustworthiness and etc. with

less bias but with more true Perception and feedback.
It also serves as an evaluation of the marketing strategy
through the survey.

BIBLIOGROPHY

1 www.google.com
2 Boomberg.com
3 Wikipedia.com