New Fund Offer and Impact of Advertisements on Buying Behaviour

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[MANAGEMENT THESIS FINAL REPORT]

A STUDY
ON
IMPACT OF ADVERTISING ON N.F.O (NEW FUND OFFER) IN MUTUAL FUNDS OF RELIANCE MONEY [MANAGEMENT THESIS-1]
SUBMITTED BY
SHARIF.SHEIK
8NBNL019
INC, NELLORE.

AN FINAL REPORT
ON
STUDY ON IMPACT OF ADVERTISING ON N.F.O (NEW FUND OFFER) IN MUTUAL FUNDS OF RELIANCE MONEY

Submitted by
SHARIF.SHEIK (8NBNL019)

Under the Guidance of
Mrs. S. JYOTHIRMAYE REDDY
Faculty Supervisor

NELLORE
(2008-2010)

CONTENTS

1.Industry profile………………………………………..3 2.Company profile………………………………………7 3.Objectives……..………………………………………9 4.Limitations……………………………………………10 5.Methodology…………………………………………..11 6.Time Estimation……………………………………….12 7.Summary…….…………………………………………13 8.Questionnaire…………………………………………..14 9.Reference...…………………………………………….17

INDUSTRY PROFILE
The Evolution
The formation of Unit Trust of India marked the evolution of the Indian mutual fund industry in the year 1963. The primary objective at that time was to attract the small investors and it was made possible through the collective efforts of the Government of India and the Reserve Bank of India. The history of mutual fund industry in India can be better understood divided into following phases: Phase 1. Establishment and Growth of Unit Trust of India - 1964-87 Unit Trust of India enjoyed complete monopoly when it was established in the year 1963 by an act of Parliament. UTI was set up by the Reserve Bank of India and it continued to operate under the regulatory control of the RBI until the two were de-linked in 1978 and the entire control was transferred in the hands of Industrial Development Bank of India (IDBI). UTI launched its first scheme in 1964, named as Unit Scheme 1964 (US-64), which attracted the largest number of investors in any single investment scheme over the years.

UTI launched more innovative schemes in 1970s and 80s to suit the needs of different investors. It launched ULIP in 1971, six more schemes between 1981-84, Children's Gift Growth Fund and India Fund (India's first offshore fund) in 1986, Mastershare (Inida's first equity diversified scheme) in 1987 and Monthly Income Schemes (offering assured returns) during 1990s. By the end of 1987, UTI's assets under management grew ten times to Rs 6700 crores.

Phase II. Entry of Public Sector Funds - 1987-1993
The Indian mutual fund industry witnessed a number of public sector players entering the market in the year 1987. In November 1987, SBI Mutual Fund from the State Bank of India became the first non-UTI mutual fund in India. SBI Mutual Fund was later followed by Canbank Mutual Fund, LIC Mutual Fund, Indian bank Mutual Fund, Bank of India Mutual Fund, GIC Mutual Fund and PNB Mutual Fund. By 1993, the assets under management of the industry increased seven times to Rs. 47,004 crores. However, UTI remained to be the leader with about 80% market share. 1992-93Amount MobilisedAssets Under ManagementMobilisation as % of gross Domestic Savings UTI11,05738,2475.2%

Public Sector1,9648,7570.9%
Total13,02147,0046.1%
Phase III. Emergence of Private Secor Funds - 1993-96
The permission given to private sector funds including foreign fund management companies (most of them entering through joint ventures with Indian promoters) to enter the mutal fund industry in 1993, provided a wide range of choice to investors and more competition in the industry. Private funds introduced innovative products, investment techniques and investor-servicing technology. By 1994-95, about 11 private sector funds had launched their schemes. Phase IV. Growth and SEBI Regulation - 1996-2004

The mutual fund industry witnessed robust growth and stricter regulation from the SEBI after the year 1996. The mobilisation of funds and the number of players operating in the industry reached new heights as investors started showing more interest in mutual funds. Invetors' interests were safeguarded by SEBI and the...
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