A STUDY OF AWARENESS LEVEL OF SMALL SAVING OPTIONS AND KNOWING THE CUSTOMER PREFERANCE WITH KOTAK MUTUAL FUND

IN CHENNAI PROJECT REPORT Submitted to the SCHOOL OF MANAGEMENT In the partial fulfillment of the requirement For the award of the degree of MASTER OF BUSINESS ADMINISTRATION By AMIT KUMAR SINGH (35080035) Under the guidance of Prof. S.Sundararajan

SRM SCHOOL OF MANAGEMENT SRM UNIVERSITY KATTANKULATHUR 603203 MAY 2010

BONAFIDE CERTIFICATE

This is certify that Mr. Amit kumar Singh ,Reg No: 35080035 is a bonafide student of the department of management Studies, SRM college and the project work titled, A STUDY OF AWERNESS LEVEL OF SMALL SAVING OPTIONS AND KNOWING THE CUSTOMER PREFERANCE WITH KOTAK MUTUAL FUND IN CHENNAI is in partial fulfillment for obtaining the Post Graduate Degree of Master in Business Administration.

Dr. Jayshree Suresh Dean Prof. S.Sundararajan Project Guide

Signature of the External Examiner

DECLARATION

I hereby declare that this project report titled A STUDY OF AWERNESS LEVEL OF SMALL SAVING OPTIONS AND KNOWING THE CUSTOMER PREFERANCE WITH KOTAK MUTUAL FUND IN CHENNAI has been submitted by me for the award of management of business management, as partial fulfillment of the requirements for these courses.

This is the result of the original work carried out by me. This Report has not been summated anywhere else for the award of any other degree/diploma.

DATEAMIT KUMAR SINGH (REG.NO-35080035)

ACKNOWLEDGEMENT Itisamomentofgreatpleasureformeinventuringouttopresentthisprojectreporttothe SRMSchoolofmanagement,kattankulathur,Chennai. I wish to convey my deep sense of gratitude to my project guide Prof. S.Sundararajan without his kind cooperation my project report would not be in such a shape. I am fortunatetohaveanopportunitytostudyunderhisableguidance. IalsoexpressmyprofoundsenseofgratitudetoMr.GopalKrishnan(Sr.FinanceManager) whogavemevaluabletimeandsuggestionforthepreparationofthisprojectreport. I will also remember the cooperation of Mr.Muttu sir, and the employees of kotak Mahindramutualfund,Teynampet,Chennai. I will also oblige to my intimate friends and colleagues who have provided valuable suggestionsforthepreparationofthisprojectreport. I feel proud to present my report as part of my MBA studies with a view to accomplish a degreeofMBA(FINANCEANDHR)Session20082010. Lastly, this project report is the result of continuous help of many known and unknown Im heartilyindebted. AmitKumarSingh

INDEX CHAPTER I. INTRODUCTION 1.1 Abstract 1.2 Introduction to mutual fund and its aspects 1.3 Objective of study 1.4 Scope of Study 1.5 Limitation of Study II. III. COMPANY PROFILE RESEARCH METHODOLOGY 3.1 Sample Plan 3.2 Source of Data 3.3 Data Collection Method 3.4 Tools of Data Collection 3.5 Statistical Tools IV. DISCRIPTION OF PLANS 4.1 Need of Small Savings Plans 4.2 Category of small saving Investment 4.3 Detail Study of Small saving plan V. VI. VII. VIII. IX. X. ANALYSIS AND INTERPRETATION FINDINGS SUGGESTIONS CONCLUSION BIBLIOGRAPHY ANNEXURE 28 62 65 67 69 71 13 9 11 CONTENTS PAGE NO. 1

LISTOFTABLES S.NO. 1 2 3 Table for sec Return Investment preference of custom Investment customer prefer acc. to small saving option. Investment in accordance to social economic class Income wise small saving investment Saving investment acc. to age group Money invested acc. to income of customer Saving plans related to money invested from income Sources for knowledge about plans Customer consults whom for investment TABLE NAME PAGE NO. 29

30 31

4 5 6 7 8 9 10

33 35 37 39 40 42 43

11

No. of respondents invested plans

44

S.NO. 12

TABLE NAME Schemes in which customer has invested

PAGE NO. 45

13

Schemes in which customer has invested relation with age group Effect of income on future reinvestment

47

14

49

15

Investmentreasons

51

16

Factorsaffectingtheinvestingdecision Specialisthelpsreturn

52

17

53

18

Trustedinstitutionsforinvestment Distributer interest in plans Distributer interest in plans suggestion for investment products. Small saving products in which distributor deal Saving plans advice by distributor

54

19

55

20

56

21

57

22

59

LIST OF GRAPHS S.NO. 1 2 3 4 5 6 7 8 9 10 11

GRAPH Graph for sec Return Investment preference of custom Investment customer prefer acc. to small saving Investment in accordance to social economic class Income wise small saving investment Saving investment acc. to age group Money invested acc. to income of customer Saving plans related to money invested from income Sources for knowledge about plans Customer consults whom for investment No. of respondents invested plans

PAGE NO. 29 30 option. 32 34 36 38 39 41 42 43 44

S.NO. 12 13 14 15 16 17 18 19 20 21 22

GRAPHS Schemes in which customer has invested Schemes in which customer has invested relation with age group Effect of income on future reinvestment Investmentreasons Factorsaffectingtheinvestingdecision Specialisthelpsreturn Trustedinstitutionsforinvestment Distributer interest in plans Distributer interest in plans suggestion for investment products. Small saving products in which distributor deal Saving plans advice by distributor

PAGE NO. 46 48 50 51 52 53 54 55 56 58 60

INTRODUCTION

Abstract
Investing money is a freater than earning money, especially slow down and with so many options in market

available (mutual fund, FDs,

Insurances, Post office savings.) Today saving plans play an important role in the economy. India's high savings rate has been a crucial driver of its economic boom, providing productive capital and helping to fuel a virtuous cycle of higher growth. Indian mutual fund market has high proportion and about 5-10% of the Indian population is in mutual fund investment. My project is Study of awareness level of small saving options and knowing the customer Preferences about plans. The purpose of the project is to know about the small savings options and how customer prefers

these plans. Today around 27% of total investment is covered by small saving plans. Secondary data will be used for getting knowledge

about these plans and customers preferences will be known by the Primary sources data. Primary data is collected from the market survey through the questionnaire. After that social economic class (SEC) A, B, C is formed on the basis of profession and education. Data entry is done in SPSS software. Analyzing is done on the basis of hypothesis formed. Finally through

this analyzing we get to know about how people invest acc. to their income and age.

INTRODUCTION TO MUTUAL FUND AND ITS VARIOUS ASPECTS Mutual fund is a trust that pools the savings of a number of investors who share a common financial goal. This pool of money is invested in accordance with a stated objective. The joint ownership of the fund is thus Mutual, i.e. the fund belongs to all investors. 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 appreciations realized are shared by its unit holders in proportion the number of units owned by them. Thus a Mutual Fund is the 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. A Mutual Fund is an investment tool that allows small investors access to a well-diversified portfolio of equities, bonds and other securities. Each shareholder participates in the gain or loss of the fund. Units are issued and can be redeemed as needed. The funds Net Asset value (NAV) is determined each day. Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders.

When an investor subscribes for the units of a mutual fund, he becomes part owner of the assets of the fund in the same proportion as his contribution amount put up with the corpus (the total amount of the fund). Mutual Fund investor is also known as a mutual fund shareholder or a unit holder. Any change in the value of the investments made into capital market instruments (such as shares, debentures etc) is reflected in the Net Asset Value (NAV) of the scheme. NAV is defined as the market value of the Mutual Fund scheme's assets net of its liabilities. NAV of a scheme is calculated by dividing the market value of scheme's assets by the total number of units issued to the investors.

ADVANTAGES OF MUTUAL FUND Portfolio Diversification Professional management Reduction / Diversification of Risk Liquidity Flexibility & Convenience Reduction in Transaction cost Safety of regulated environment Choice of schemes Transparency

DISADVANTAGE OF MUTUAL FUND

No control over Cost in the Hands of an Investor No tailor-made Portfolios Difficulty in selecting a Suitable Fund Scheme Managing a Portfolio Funds

CATEGORIES OF MUTUAL FUND:

Objective of the project:

PRIMARY OBJECTVES:

1) To know whether investors have good knowledge of plans. 2) To know about the relationship between available information and investment of the people. 3) To know inclination towards future reinvestment. 4) To know which plan is suitable for investors to get maximum return.

SECONDARY OBJECTIVES: 1) Analyzing investors way, modes and types of investments in

mutual funds and small saving schemes plans. 2) Analyzing the inclination of SEC (social economic class), (middle class, whose incomes are in between 1lakh to 5lakhs ) towards the Investments

Scope of project: Of late saving plans play an important role in the Indias economy. The scope of this project is limited to the study of Small investment and savings options available nearby. Social economy classes know about the plans or not. My project is Study of awareness level of small saving options in mutual fund and knowing the customer Preferences with kotak securities, Chennai. The purpose of the project is to know about the small savings options and how customer prefers these plans. Today around 27% of total investment is covered by small saving plans.

Limitations of project: 1. Limited areas- As due to limited area covering, so behavior of investors is different at other regions. 2. Limited samples- Each investor has different psychology so study becomes biased and sample may not help to gather depth knowledge. 4. Lack of time- Due to limited time it is not possible to make depth study of these plans. 5. Investors behavior is affected.

6. Market condition also affects the survey i.e. Investment depends on market condition.

COMPANY PROFILE

Introduction to company Kotak Mahindra Asset Management Company Limited (AMC) is wholly wend subsidiary of Kotak Mahindra Bank a

Ltd. Kotak

Mahindra Finance Limited (KMFL) was set up in 1985 with a capital base of Rs. 3 million and a single product. From those beginnings, KMFL has grown into a highly diversified financial services company with a net worth of over Rs. 59 billion. The Group currently offers financial services of every Kind, including loans, lease and hire purchase, consumer finance, car finance, investment banking, stock broking and primary market distribution of equity and debt products, business information services and more. The Group has offices across 370 cities in India as well as in Dubai,Mauritius and London. Kotak Mahindra (UK) Ltd, a subsidiary of KMFL, is the first company owned from India to be registered with the Securities and Futures Authority in London.
No. of schemes No. of schemes including options Equity Schemes Debt Schemes Short term debt Schemes Equity & Debt 66 178 24 126 8 3

RESEARCH METHODOLOGY

Methodology for Project In this project I will go through following methods:1. Primary data: Designing the questionnaire to know the

customer preference towards the small savings plans. For e.g. a) Their preference acc. to their requirement and their age. b) Do they look for fixed or variable returns? c) Do they invest for I. Tax saving II. Safe and quite return

2. Secondary data: knowledge about these plans ,their rate of interest, minimum and maximum balance , maturity periods and their way of marketing through Private ,PSU bank, co-operative bank and post office. In this I will take help of internet, factsheets of company, documents and pamphlets provided. 3. Sample plan: Sampling size: - 105 respondents. Sampling method: simple Random sampling. 4. Statistical tools used: Percentage analysis. Simple average methods. Chi-square analysis.

DESCRIPTION OF PLANS

Need of Small Savings Plans India's high savings rate has been a crucial driver of its economic boom, providing productive capital and helping to fuel a virtuous cycle of higher growth, higher income and higher savings. Since the 1990s, the gross domestic savings rate has risen steadily from an average of 23% to an estimated high of 35% in the 2006/07 fiscal year (April-March). The latter rate compares very favorably not only with developed economies (the US and the UK have savings rates of around 14%), but also with other emerging economieswith a few exceptions such as Malaysia (38%) and Chile (35%). After losing their investments in stock markets in the past, small investors are preferring risk-free small savings schemes, which saw 27.33 per cent surge in collection to Rs 54,126 crore in AprilAugust in the current fiscal from Rs 42,507 crore in April-August in the past two fiscal years. The above plans show how the small savings are useful to the develop in country like India. Addition of rupee to rupee makes a huge amount and it is very useful to the countrys economy. Since Indias 60% population is dependable on agriculture so these small saving plays a great role and encourage the common man to come out for saving and this make a country economically good.

Category of small saving Investment Small Saving Options investment can be done through following ways:I. Variable return II. Fixed return The following plans in project can be explain through above category: 1. Variable return: - In this the return totally depends on the market like mutual fund investments. In this SIP(systematic investment plan) can be taken as small saving plan.SIP helps the customers to b shares of mutual fund by making regular payments-usually as little as Rs500. 2. Fixed return: - In this the return is being fixed earlier by the government. The chances of change in the rate of interest are less. This contain:I. Kisan Vikas Patra II. National Savings Certificate III. Fixed Deposits IV. Post office term Deposit V. Monthly Income Scheme Account VI. Recurring Deposit Account VII.Public Provident Fund(PPF) VIII.RBI Bonds IX. Post office Saving Account X. Pay Roll Saving Scheme XI. Senior Citizen Saving Schemes

Detail Study of Small saving plan Following are details of the saving plans which are considered in project:-s 1. Kisan vikas patra a) b) c) d) e) f) Maturity Period 8 years 7 months Money doubles in the after maturity period Mode of payment- Lumpsum Minimum amountRs 100 Maximum amountNo limit No tax and loan facility is available.

Advantages:Long term investment. Return is double after maturity. mostly liked by people from rural and people whose income is less. Disadvantages:If money is taken back before maturity period than interest provide is 3.5%. Investment time is very high, so less preferred. Product Availability:Through agents and all post offices Marketing of the product:Through agents, advertisements, Word of mouth and internet.

2. National Saving Certificate a) Maturity Period6 years b) Interest8.16% (compounded half yearly) c) Mode of payment- Lumpsum d) Minimum amountRs 100 e) Maximum amountNo limit f) Loan facilityNo g) Tax benefitsYes Advantages:Tax benefit is there Interest is compounded half yearly so, it increases after 6 months and becomes 12.06% after 6 years. Mostly liked by every category of people. Disadvantages:Money is encased back after maturity period only. Investment time is high. Product Availability:Through agents, banks and all post offices Marketing of the product:Through agents, advertisements, Word of mouth and internet

3. Public Provident Fund a) Maturity Period15 years b) Interest8% c) Mode of payment- Lumpsum/Installments d) Minimum amountRs 500 e) Maximum amountRs 70,000 f) Loan benefit Yes g) Tax BenefitsYes Advantages:Money is paid in installments. People mostly invest in it for tax benefit. Loan facility is available. Deposits in this account are not subject to attachment under an order or a decree of Court and are also free of Wealth Tax. 4. Post Office Monthly Income Scheme (POMIS) a) Maturity Period6 years b) Interest8% c) Mode of payment- Lumpsum d) Minimum amountRs 1500 e) Maximum amountRs 4, 50,000 f) Loan benefit no g) Tax Benefitsno

Advantages:To get good monthly income, we have to invest high lumpsum amount. No tax benefits. Product Availability:Through agents and all post offices Marketing of the product:Through agents, advertisements, Word of mouth and internet

5. Post Office Term Deposits (POTD) a) Maturity Period1-5 years b) Interest6.25-7.5% c) Mode of payment- Lumpsum d) Minimum amountRs 50 e) Maximum amountNo limit f) Loan Facility no g) Tax Benefitsno Advantages:Maturity period is less. Amount is less, so affordable for every category. Disadvantages:Return interest is less, so liked by people whose income is more. No tax and loan facility. Product Availability:Tax BenefitsYes

6. Post Office Recurring Deposits (PORD)

a) Maturity Period5 years b) If Rs10 is invested for 5 years than Rs600 becomes Rs728.90 c) Mode of payment- Lumpsum/Installments d) Minimum amountRs 10 e) Maximum amountNo limit f) Loan Facility Yes g) Tax Benefitsno Advantages:Loan facility is available. Payments are also through installments. Low investment, so liked by daily earning wage people.

Disadvantages:Less interest acc. to maturity period. Only popular among low earning people. Product Availability:Through agents and all post offices Marketing of the product:Through agents, advertisements, Word of mouth and inter

7. Post Office saving Account (POSA)

a) Maturity Periodmin 1 year b) Interest3.5% c) Mode of payment- any type of payment d) Minimum amount20 e) Maximum amount1, 00,000 f) Loan benefit no g) Tax BenefitsYes

Advantages:Tax facility is available so people prefer it. Payments are through any mode. Disadvantages:People do not use it as the investments.

Product Availability:Through agents sand all post offices Marketing of the product:Through agents, advertisements, Word of mouth and internet

8. Senior Citizen Saving Scheme (SCSS)

a) Maturity Period5 year (can be extended for 3 years) b) Interest9%(compounded quarterly) c) Mode of payment- Lumpsum d) Minimum amount1000 e) Maximum amount15, 00,000 f) Loan benefit no g) Tax Benefitsno Advantages:Money can be taken back before maturity period. Disadvantages:Less interest acc. to maturity period. Product Availability:Through agents and all post offices Marketing of the product:Through agents, advertisements, Word of mouth and internet.

9. Systematic Investment Plan (SIP)

a) Maturity Periodmin. 6 months b) Interestdepends on market c) Mode of Payment-- Installments d) Minimum amount1000 e) Maximum amountNo Limit f) Loan benefit no g) Tax BenefitsOn Tax Saver Plan Advantages:Payments are through installments. Good returns when the market is down. Least Risky

Disadvantages:Variable return because of market dependable. More transparency. Product Availability:Through agents, Distributors and mutual fund offices.

Marketing of the product:Through agents, advertisements, Word of mouth and internet

10. Fixed Deposits (FD)

a) Minimum amount:Nationalize BanksRs 5000/10000 Private BankRs 10000 Co-operative BankRs 500/1000 b) LoanYes (Bank Overdraft) c) Tax BenefitNo d) Mode of payment- Lumpsum e) Minimum maturity period 15 days f) Maximum maturity period 10 years h) Maximum amountNo limit I) Interest for all banks the interest is same, there is a slightly
change in the Interest rate. It is different for the different

banks.
There may be difference in the maturity period and returns. The main difference is between the amounts invested. Amount invested in the co-operative bank is least; Nationalize bank has less

investment than private. So, private bank has highest investments.

Below is the interest rate of HDFC Bank.It can be taken as the for other

banks also. They have Interest/annum

same pattern as HDFC Bank.

Days/years

7-15 days 3.00% 15-29 days 3.50% 30-45 days 4.00% 46-60 days 4.50% 61-90 days 5.00% 91-180 days 5.50%

180-195 days 7.00% 196285 days 7.00% 286.365Days 7.25% 286-365 days (1 year) 7.25% 1-5 year 8.00% >5 years 8.00% Advantages:Loan facility is available (Bank overdraft). Maturity period is very less. Mostly liked by every category of people, they take it as safe side. Disadvantages:Return interest is acc. to maturity period. To get good return investment must be high. Product Availability:Through agents, Nationalize banks and all post offices

Marketing of the product:Through agents, advertisements, Word of mouth and internet

11. Pay Roll Savings Scheme

Under this scheme, any monthly salaried person can voluntarily authorize his appointing authority or employer to deduct monthly contributions from his salary and to remit into anyone of the savings schemes like Post Office Recurring Deposit, Post Office Time Deposit, National Savings Certificate (VIII issue) and Public Provident Fund Scheme. The group leader appointed in each organization for collection purpose is paid 2% commission for his service who implements the scheme in the

respective concern. Advantages:Collection is through a concern person, so money investment is good. Disadvantages:People do not refer it because they want to do personally and acc. to their requirements.

12. RBI Bonds

a) Maturity Period-- 5 years b) Interest8% (compounded half yearly) c) Mode of payment- Lumpsum d) Minimum amountRs 1000 e) Maximum amountRs 2, 00,000 f) Loan benefit Yes g) Tax Benefitsyes (on returns only) Advantages:Loan and tax facility is available. Good return due to half yearly compounded interest. Disadvantages:To get good monthly income, we have to invest high lumpsum amount. Product Availability:Authorized Branches of State Bank of India, Associate Banks, Nationalized Banks, four private sector banks and SHCIL Marketing of the product:Through advertisements, Word of mouth and internet

ANALYSIS AND INTERPRETATION

PLAN ANA ALYSIS OF CUST TOMER R SURVE EY

Analysis of project: vey from customer Surv mation of social econ nomic class (SEC) 1. Form Tota al responde ents105 SEC C A B C 46 42 17

SEC C

16%C 44%A

40% %B

Infer rence: 44 % of people e belong to o A sec, where w as 40 0% to B se ec followed by 16% C class of f people.

e of return n Investme ent prefere ence of customer 2. Type Fixed Return 1 13 2 21 8 Variable Return 10 3 2 Both 2 17 4

Sec A Sec B Sec C

25 20 15 10 5 0 Fix xedReturn VariableReturn R SecA Se ecB SecC Both

Inference:I m the table is can be stated s that 20% of SE EC B,12% of SEC A, 8% From of SE EC C people are inter rested in fixed return n. 9% of SEC A,3% A of SE EC B, 2% of SEC C people ar re intereste ed in able return n. Varia 16% of SEC B, 03% of SEC S A, 4% % of SEC C people ar re intereste ed in both type of ret turn.

3. What type of investment customer prefer according to small saving option. fixed return kisan vikas patra public provident fund national certificate fixed deposits saving 12 16 22 25 9 10 3 3 11 3 2 13 Variable return 1 5 3 4 0 1 1 0 3 1 0 12 Both Percentage

8 29 21 28 11 15 2 3 10 10 0 40

6.08 14.49 12.75 16.52 5.79 7.53 1.73 1.73 6.93 6.93 0.53 18.84

post office saving account post office monthly income post office term deposits senior citizen saving scheme Recurring deposit account RBI bonds pay roll saving scheme SIP

70 60 50 50 40 30 20 10 0 20 14 6 6 2 26 46 57

65

24

Inference: From the table is can be stated that in SIP 18.84% people are investing, followed by fixed deposit 16.52%, where as14.49% people are investing in PPF.

4. Saving plans investment in accordance to social economic class (SEC) SECA SEC B 4 12 30 22 26 5 9 1 4 9 8 1 36 14 18 26 13 14 2 1 11 5 1 24 SEC C 5 6 6 5 2 3 3 1 4 1 0 5 PERCENTAGE 6.08 14.49 12.75 16.52 5.79 7.53 1.73 1.73 6.93 6.93 0.53 18.84

kisan vikas patra public provident fund National saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP

SIP

payrollsavingscheme

RBIbonds

recurringdepositaccount

seniorcitizensavingscheme

postofficetermdeposits

postofficemonthlyincome

postofficesavingaccount

fixeddeposits

nationalsavingcertificate

publicprovidentfund 0 10 20 30 40 50 60 70

Inference: From the above table it can be interpreted that in 18.84% person are invested in SIP, where as are 16.52%invested in Fixed deposit, followed by 14.49% person on PPF.

5. Income wise small saving investment <1 lakh kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring account RBI bonds pay roll scheme SIP saving deposit 8 7 9 8 6 5 2 1 5 1 0 2 1-2 lakh 9 12 15 20 9 13 3 1 10 4 1 26 2-5 lakh 4 26 20 26 4 6 1 2 8 7 1 31 >5 PERCENTAGE lakh 0 5 2 3 1 2 0 2 1 2 0 6 6.08 14.49 12.75 16.52 5.79 7.53 1.73 1.73 6.93 6.93 0.53 18.84

SIP payrollsavingscheme RBIbonds recurringdepositaccount seniorcitizensavingscheme postofficetermdeposits postofficemonthlyincome postofficesavingaccount fixeddeposits nationalsavingcertificate publicprovidentfund 0 10 20 30 40 50 60 70

Inference: From the above table it can be interpreted that income wise small saving investment are 18.84% invested in SIP, where as 14.49% investor invested in PPF .

6. Saving investment according to age group

19-30 kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP
PERCENTAGE

31-50 12 15 23 23 7 16 2 3 8 8 0 21
40.82

51-72 4 1 4 3 4 1 1 3 2 2 0 3
8.28

5 34 19 31 9 9 3 1 14 4 2 41
50.08

45 40 35 30 25 20 15 10 5 0

1930 3150 5172

Inference: From the above table it can be interpreted that the age group 19-30, has invested 50.08%,age group 31-50 invested are 40.82%, followed by 8.28% of the age group 51-72.

7. Money invested according to income of customer 5-10 thous <1 lakh 15 10-20 thous 4 20-40 thous 0 >40 thous 0

1-2 lakh

18

2-5 lakh

11

18

>5 lakh

% age

27.72

16.83

28.71

26.73

45 40 35 30 25 20 15 10 5 0 510thous 1020thous 2040thous >40thous %ageof customer <1lakh 12lakh 25lakh >5lakh %age

Inference: From the above table it can be interpreted that 27.27% respondent invested 5-10 thousands, where as 26.74% invested are more than 40 thousands.

8. Small saving plans related to money invested from income 5-10 thous kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP 8 14 11 12 8 8 3 3 6 1 0 12 10-20 thous 4 7 8 10 1 3 0 0 3 2 1 11 >40 %tage 2040 thous thous 6 12 15 18 6 8 3 1 7 5 0 21 3 17 12 17 5 7 0 3 8 6 1 21 6.21% 14.8% 13.61% 16.86% 5.93% 7.7% 1.78% 2.07% 7.2% 4.14% 0.6% 19.23%

SIP payrollsav vingscheme RBIbonds recurringdepositaccount se eniorcitizensav vingscheme postofficete ermdeposits post p officemon nthlyincome postofficesav vingaccount fix xeddeposits nationalsavin ngcertificate publicpro ovidentfund kisan nvikaspatra 0 5 10 0 15 20 25 >4 40thous 20 040thous 10 020thous 510thous

In nference: From th he above table it ca an be inte erpreted th hat portion n of money invested fro om income e in SIP is s19.23%, where w as in n FD 16.86%, followed by PPF is 14.8%.

nowledge about these plans. 9. Sources for kn ustomers Cu Newspa apers Agents Words of mouth Others 22 40 30 8 % Age 21 38.09 28.57 7.61

40 35 30 25 20 15 10 5 0

percentage

Custo omers %Age

so ource

In nference: Fr rom the ab bove table it can be interpreted d that 40% %customers s get kn nowledge about a the plans thro ough Agen nts,30% wo ord of mo ouths fo ollowed by 22% news spapers.

0. Custome er consult ts whom fo or investm ment. 10 Consultant C t Agent Family Friends Others Custome er 46 23 19 12 e % Age 43.80 21.90 18.09 11.41

50 45 40 35 30 25 20 15 10 5 0 Agent Family Friend ds Others s

PERCENTAGE

C Customer %Age

C CUSTOMER

In nference: Fr rom the ab bove table e it can be b interpre eted that 46% 4 costu umer co onsult agen nts, 23% family wh here as only o 19 % consult with fri iends.

11. No. of respondents invested in small savings option. kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP 21 50 46 57 20 26 6 6 24 14 2 65
6.23%

14.83%
13.64% 16.91% 5.93% 7.71% 1.78% 1.78% 7.12%

4.15% 0.59% 19.28%

SIP payrollsavingscheme R bonds RBI recurringdeposi itaccount orcitizensavingscheme senio postofficeterm mdeposits post tofficemonthlyincome po ostofficesaving gaccount fixed ddeposits na ationalsavingcertificate c publicprovid dentfund kisanvi ikaspatra 0 10 20 30 40 50 60 70

In nference: rom the above table it i can be in nterpreted that 19.28% respond dents Fr invested in SIP, wher re as 16.9 91% invested in FD D, followed d by 4.83% in PF. P 14

12. Schemes in which customer has invested in past and willing to reinvest in future kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP 21
6.23%

50 46 57 20 26 6 6 24

14.83%
13.64% 16.91%

5.93% 7.71%

1.78% 1.78%

7.12%

14 2 65

4.15%

0.59%

19.28%

kisanvikas v patra payroll saving scheme RBIbonds nationalsaving certificate recurring sit depos account senior rcitizen savingscheme po ostoffice term mdeposits po ostoffice mont thlyincome SIP P publicpr rovident fun nd

ts fixeddeposit

postofficesaving t account

nference: In From the above ta able it can be stated that custo omer willin ng to 9.28%, wh here as in F FD 16.91% % followed d by reinvest in SIP 19 13.64% in NSC.

13. Schemes in which customer has invested in past and willing to reinvest in future and its relation with age group. 19-30 yrs kisan vikas patra public provident fund national saving certificate fixed deposits Equity market post office monthly income post office term deposits senior citizen saving scheme recurring deposit account Life insurance ULIP SIP Percentage 8 17 13 27 7 7 0 0 8 13 1 37 52.27% 31-50 yrs 11 8 13 13 3 10 1 1 5 12 1 29 51-72 yrs 5 1 3 2 0 1 1 1 2 1 0 2

40.5% 7.2%

SIP ULIP Lifeinsurance i recurringdeposi itaccount senio orcitizensavingscheme postofficeterm mdeposits post tofficemonthlyincome Equit tymarket fixed ddeposits na ationalsavingcertificate c publicprovid dentfund kisanvi ikaspatra 0 10 20 30 0 40 5172yrs 3150yrs 1930yrs

In nference: From the e above tab ble it can be b stated th hat custome er has inve ested in past and a willing g to reinves st in future e and its rel lation with h age group, 52.27% 5 of responden nt are of ag ge group 19 9- 30,wher re as 40.5% of o responde ent are age e group of 31-50, 3 foll lowed by 7.2% 7 of respon ndent are of o age grou up 51-70.

14. Effect of income on future reinvestment. <1 lakh 1-2 lakh 2 8 13 13 3 10 1 1 5 12 1 29

98

2-5 lakh 0 1 3 2 0 1 1 1 2 1 0 2
14 6.03%

kisan vikas patra public provident fund national saving certificate fixed deposits Equity market post office monthly income post office term deposits senior citizen saving scheme recurring deposit account Life insurance ULIP SIP
Total Percentage

0 17 13 27 7 7 0 0 8 13 1 37
120 51.7%

42.24%

40 35 30 25 20 15 10 5 0 <1lakh 12lakh 25lakh

Inference: From the above table it can be stated that effect of income on future investment, Those are having less than 2 lakh income are 51.7%,where as 42.24% are from 1-2 lakh, followed by 6.03% in 2-5 lakh income.

15. Inve estment re easons OP PTIONS Secu ure future Tax x Saving Pro osperity Needs N Others O RESP PONDENT T 23 34 22 11 15 PER RCENTAG GE 22 33 21 10 14

35 30 25 20 15 10 5 0 Secure future T Saving Tax P Prosperity Needs Others

In nference: From F the ab bove table it can be stated that t 33% are invested i du ue to tax, 22% fo or the secu ure future, followed f b 21% for by r prosperity y reasons.

16. Fac ctors which h affecting g the inves sting decis sion. OP PTIONS Tim me Frame Tax x Saving Risk Return R Other O RES SPONDEN NT 22 24 15 34 10 PER RCENTAG GE 21 18 14 33 10

35 5 30 0 25 5 NUMBER 20 0 15 5 10 0 5 0 TimeFram me TaxSaving g Risk FACTORS Return Other

In nference: From F the above a tabl le it can be stated that Factors which h affecting g the in nvesting de ecision are e 33% risk, , where as 21% time followed by b 18% tax x.

17. Specialist helps in getting more return. OPTIONS Yes No Believe on self RESPONDENTS 67 12 PERCENTAGE 64 11 25

26

25% Yes No 11% Believeonself 64%

Inference: From the above table it can be stated that 64% said yes to specialist help and followed by 11% no.

18. Mos st trusted institution ns for inve estment. OP PTIONS Public Sector Priva ate Sector Bank B Joint Venture PONDENT TS RESP 25 29 48 PER RCENTAG GE 24 28 46 02

JointVent ture INSTITUTION B Bank PrivateSector PublicSector 0 1 10 20 30 40 50 Series1

STOR INVES

nference: In From F the ab bove table it can be revealed that trusted institutions i s for in nvestment are 46% bank, b 28% private sec ctor follow wed by 24% % public se ectors.

19. Dist tributer in nterest in plans p RESPONDENTS OPTIO ONS Mutual fund f 30 Saving plans Insuran nce Bank fina ancial Others 37 20 16

PER RCENTAG GE 29 35 19 15 2

45 40 35 30 25 20 15 10 5 0 Mutual M fund Saving S plans Insurance Bank financial Others

nference: In From F the above a table e it can be e revealed that 35% distribute er intereste ed in sa avings plan n, 29% in mutual m fun nd followed d by 15% banking b fin nancial.

20. The profession time of distributor related to the factors while suggesting for investment products. 1-2 yrs 2-5 yrs 5- 10 yrs >10 yrs
%

Time frame Risk appetite Tax Savings Return

8.89%

16

20

30.4%

11

14

22.2%

17

22

34.8%

Others

3.7%

Others O

Return R >10 0yrs avings TaxSa 5 1 10yrs 25yrs 12yrs Riskappetite

Timeframe f

10 0

15

20

25

nference: In From F the ab bove table e it can be revealed that t the fac ctor while suggesting g for in nvesting pr roducts, 34 4.8% on th he basis of f return, fo ollowed by y 30.4% on n the b basis of risk k and 22.2% % on tax basis. b

21. Small saving products in which distributor deal Respondent kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income post office term deposits senior citizen saving scheme recurring deposit account RBI bonds pay roll saving scheme SIP 31 37 37 44 30 31 30 32 33 15 3 39 percentage
9.6%

11.5% 11.5% 13.62% 9.29% 9.6% 9.29% 9.9% 10.22% 4.64%

0.92%
12.07%

kisanvikaspatra publicprovident p fund d nationa alsavingcertificate fixedde eposits % 11% 9% 10% 10% 8% 12% 9% % 8% postoff ficemonthly income postoff ficetermdepo osits seniorcitizen c saving scheme e recurrin ngdepositacco ount RBIbon nds payrollsavingscheme e postoff ficesavingacco ount

4%

1% 1

9% 9% %

In nference: From F the ab bove table it can be revealed r th hat Small saving s products in which w d distributor re as 12.07 7% on SIP P, followed d by deals are 13.62%on FD, wher 11.5% on PPF P and NS SC.

22. Saving plans advice by distributor kisan vikas patra public provident fund national saving certificate fixed deposits post office saving account post office monthly income Life insurance senior citizen saving scheme recurring deposit account ULIP Equity market SIP 7 9 18 18 0 23 19 0 26 6 2 34
4.32%

5.55% 11.11% 11.11% 0% 14.19% 11.72% 0% 16.04%

3.73% 1.23%

20.98%

SIP Equitymarket ULIP urringdeposita account recu seniorcitizensavingscheme surance Lifeins postoffice o monthlyincome tofficesavingaccount a post deposits fixedd nationalsavingcertificate public p providentfund kisanvika aspatra 0 5 10 15 20 25 30 35

In nference: From F the above tab ble it can be revea aled that saving s pla ans advice e by d distributors are 20.98% on SIP, , 16.04% recurring r d deposit account, follo owed b post offi by ice monthly y incomes are 14.14% %.

Chi-square Table between investment types and duration of investment: investment * duration Crosstabulation Count duration 1-2 2-4 year year 0 8 4 17 21 26 0 34 Total >4 year 9 8 10 27 1 year 31 47 27 105

investme fixed return nt variable return both Total Chi-Square Tests

1 year 14 9 0 23

Pearson ChiSquare Likelihood Ratio Linear-byLinear Association N of Valid Cases

Value df 67.606( a) 77.093 1.582 105

Asymp. Sig. (2sided) 6 6 1 .08 .000 .209

A 0 cells (.0%) have expected count less than 5. The minimum expected count is 5.40. Person Chi-square value=.08 Level of significance= .05 Person chi-square value> Level of significance Therefore, Null hypothesis is accepted InferenceType of investment and duration of investment are independent.

Chi-square Table between numbers of plans and satisfaction with return: no.palns * satisfaction Crosstabulation Count satisfaction yes no.paln zero s one two >two Total Chi-Square Tests Asymp. Sig. (2sided) 6 6 1 .001 .000 .011 12 9 2 10 33 no 8 7 16 14 45 dont know 0 10 6 11 27 Total yes 20 26 24 35 105

Pearson ChiSquare Likelihood Ratio Linear-byLinear Association N of Valid Cases

Value 21.498( a) 26.765 6.533 105

df

A 0 cells (.0%) have expected count less than 5. The minimum expected count is 5.14. Person Chi-square value=.001 Level of significance= .05 Person chi-square value< Level of significance Therefore, Null hypothesis is rejected. InferenceThere is the relationship between number of plans and return satisfaction.

FINDINGS

Finding 20% of SEC B, 12% of SEC A, 8% of SEC C people are interested in fixed return. 9% of SEC A,3% of SEC B, 2% of SEC C people are interested in Variable return.16% of SEC B, 03% of SEC A, 4% of SEC C people are interested in both type of return. In SIP 65 people are investing, followed by fixed deposit 57, where as50 people are investing in PPF. In SECA 36 person are invested in SIP, where as 30 are invested in PPF, followed by 26 person on fixed deposit. In SEC B 26 are invested in fixed deposit, followed by 24 in SIP and 14 in public provident fund and post office monthly income.5% of people of all class are invested in senior citizen saving scheme and post office term deposit. According to income people having less than 1 lakh income,9 are invested in national saving certificate,8 are on fixed deposit, followed by 7 on PPF. People having income between 1-2 lakh, 26 are invested in SIP where as 20 are in fixed deposit followed by 15 in NSC. People having income 2-5 lakh, 31 are invested in SIP, followed by 26 in FD and PPF and 20 in NSC. People having income more than 5 lakh, 6 are invested in SIP, 5 in PPF followed by 3 in FD. The age group 19-30, 41 are invested in SIP, 34 are in PPF followed by 31 fixed deposits. The age group 31-50,23 are invested in NSC and FD, followed by SIP 21 and PPF 15.The age group 51-72, 4 are invested in KVP,NSC, POSA followed by SIP and SCSS are 3. The income level less than 1 lakh 15are invested between 5-10 thousands,4 are in between 10-20 thousands. The income between 12 lakh people, 6 are invested in between 5-10 thousands, 18 are from 20-40 lakh followed by 7 in between 10-20 thousands rupees. Proportion of money invested form income is ,5-10 thousand rupees are invested 14 in PPF,12 in SIP and FD, followed by 11 in NSC.1020 thousands rupees invested in 11 in SIP, 10 FD followed by 8 in NSC.

 40%customers get knowledge about the plans through Agents,30% word of mouths followed by 22% newspapers. 46% costumer consult agents, 23% family where as only 19 % consult with friends. 65 respondents invested in SIP, 57 in FD followed by 50 in PPF.6 and 2 respondents only invested in post office term deposit and pay roll saving schemes. Customer having willingness reinvest in future, 65 are interested to invest in SIP, where as 57 in FD followed by 50 in PPF. customer has invested in past and willing to reinvest in future and its relation with age group, age group 19- 30,37 are interested to invest in SIP,27 are in FD followed by 17 in PPF. Age group 31-50, 29 are interested to SIP, where as 13 in NSC and FD, followed by 11 in KVP. Age group 51 -72, 5 in KVP , 3 in NSC, followed by 2-2 in FD AND SIP customer income affects future investment, less than 1 lakh income people have plan to invest 37 in SIP,27 in FD, followed by 17 in PPF. Those having income 1-2 lakh, 29 in SIP, 13 in NSC and FD, followed by 12 in life insurance. Those having income 2-5 lakh, 3 in NSC followed by 2 in SIP. 33% are invested due to tax, 22% for the secure future, followed by 21% for prosperity reasons. Factors which affecting the investing decision are 33% risk, where as 21% time followed by 18% tax. 64% said yes to specialist help and followed by 11% no. Trusted institutions for investment are 46% bank, 28% private sector followed by 24% public sectors. 35% distributer interested in savings plan,29 in mutual fund followed by 15% banking financial.

SUGGESTIONS

SUGGESTIONS: Respondent least prefers pay roll saving schemes and post office term deposit, because of less interest acc. to maturity period. So company should increase rate of interest. Respondent those are having income 2-5 lakh least prefer pay roll saving scheme and Senior citizen saving scheme because of no tax and loan benefits. So these benefits should be provided. Those are having > 5 lakh income, only 5 respondents are invested > 40 thousands. The company should make good awareness programme to this income group. Only 10% respondent invested due to needs. The company should make good awareness programme to this income group. Distributor sells minimum plans, those are having less return. The company should either increase return or include some other benefits like tax and loan. Distributors do not advice these plans post office saving account and Senior citizen saving scheme. So the company should increase the awareness of the plans in terms of good return and tax saving options.

CONCULSION

Conclusion:
In the research, the researcher found that investors have knowledge of plans, it depends on gender and locality. Available information about the plans helps investor to take decision. Information helps in awareness of investment decision. Future reinvestment found in many plans like SIP, FD, and NSC. These plans help in tax saving and getting valuable return. Distributor helps in selection of plans on the basis of return, time and risk. There is the relationship in income and investment. According to income investment differs.

BIBLIOGRAPHY

1. BOOKS AND PUBLICATIONS C.B.Gupta, principal and practices of management, 7th edition. Body westfall and Stasch, Marketing Research-Text and cases, 7th edition,1993, AITBS- New Delhi Kothari C.R.Research methodology methods and techniques,2nd edition, Wishwa publication 1990
2. INTERNET www.tnsmallsavings.com www.finance.mapsofworld.com www.mutualfundindia.com www.kotakmutual.com www.wikipedia.org www.savingwala.com www.hinduonnet.com www.mpsmallsavings.nic.in www.thehindu.com www.timesofindia.indiatimes.com
3. Search engines

www.google.com

ANNEXURE

Questionnaires
1)

Are you from Chennai? a) Yes b) No

2)

You are into which profession? a) Business b) Government Service c) Private Job d) Others specify: ____________

3)

In which range does your Annual income lie? a) <1 lakh b) 1-2lakh c) 2 - 5 lakh d) > 5 lakh

4)

Do you invest? a) Yes b) No

5)

How much you invest from your income? a) 5-10 thousand/year b) 10001-20 thousand/year c) 20001-40 thousand/year d) 40 thousand/year

6)

Whom do you consult before investing? a) Agent b) Friends c) Family d) other specify___________

7)

Are you aware of small savings plans? a) Yes b) No

8)

Which of the following small saving plans have you ever invested in? a) Kisan Vikas Patra Fund(PPF) b) National Savings Certificate c) Post office saving Account d) Post Office Term Deposit e) Recurring Deposit Account f) Pay Roll Saving Scheme g) Public Provident h) Fixed Deposits i) Post Office Monthly Income Scheme j) Senior Citizen saving Schemes k) RBI Bonds l) Systematic Investment plan (SIP)

9)

What type of investment you do? a) Fixed Return b) Variable Return

c) Both 10) From where did you get knowledge about these plans? a) Newspaper b) Word of mouth
11)

c) Agents d) others specify:_______

Of the schemes you have invested in past, which are the schemes where you are willing to reinvest in future, give your preferences accordingly: a) __________ b) __________ c) __________ d) __________ e) __________

12) What will be the maximum duration for your investment? a) 1 year c) 2-4 year b)1-2 years d) > 4 years

13) What is the number of plans, have you invested? a) Zero c) Two b) one d) more than two

14) Are you satisfied with return of your investment? a) Yes 15) Why do you invest? a) Secure future c) Tax saving e) Others 16) What is the factor which you look in, while investing? a) Time frame c) Risk e) Other specify___________ 17) Does specialist advice help you to gain more return? a) Yes b) no c) believe on self b) tax saving d) return b) prosperity d) needs b) no c) dont know

18) Which institution do you trust most? a) Public sector c) Joint venture b) private sector d) bank

19) Which of the financial products you often like to invest? a) Mutual Fund c) Saving plans d) Other specify:____________ b) Insurance d) saving plans

20) Personnel Details:a) Name:-___________________________ b) Address:_________________________________________________ c) Age:-___ d) Family Members:-_____________________ e) Contact Number:-__________________ f) Education:-_______________________

2. for distributor

1) Since how many years you are in this profession? a) 1-2 years b) 2-5 years c) 5-10 years d) >10 years

2) Which of the financial products you deal in: a) Mutual Fund d) Saving plans b) Insurance e) Bank financial products c) Other specify:____________ 3) Do you suggest that each of customers should invest in small saving plans? a) Yes b) No 4) Which are the plans in which customer had invested in past and now they are thinking for reinvestment, give your preference accordingly. a) _____________ b) _____________ c) _____________ d) _____________ e) _____________

5) Which of the following small saving plans you deal with: a) Kisan Vikas Patra Fund(PPF) b) National Savings Certificate c) Post office saving Account d) Post Office Term Deposit e) Recurring Deposit Account f) Pay Roll Saving Scheme g) Public Provident h) Fixed Deposits i) Post Office Monthly Income Scheme j) Senior Citizen saving Schemes k) RBI Bonds l) Systematic Investment plan (SIP) 6) Personnel Details:a) Name:-___________________________ b) Address:_________________________________________________ c) Age:-___ d) Family Members:-_____________________ e) Contact Number:-__________________ f) Education:-_______________________