COMPARITIVE ANALYSIS OF MUTUAL FUND OF

HDFC AND ICICI

Submitted To :- SUBMITTED BY:-

Department of Business ANMOL GUPTA
administration
 INTRODUCTION
Mutual funds are pools of money that are managed by an
investment company. They offer investors a variety of goals,
depending on the fund and its investment charter. Some funds,
for example, seek to generate income on a regular basis. Others
seek to preserve an investor's money. Still others seek to invest in
companies that are growing at a rapid pace. Funds can impose a
sales charge, or load, on investors when they buy or sell shares.
Many funds these days are no load and impose no sales charge.
Mutual funds are investment companies regulated by the
Investment Company Act of 1940. Related: open-end fund,
closed-end fund.
 
 
 CONCEPT
A mutual fund is a trust that pools the savings of a no. 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
appreciations realized are shared by its unit holders in
proportion to 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 diversified,
professionally managed basket of securities at a relatively low
cost.
 Historical Aspect

Mutual fund firstly was established in 1822 in the

form of Society General De Belguique. It mainly gains
the progress in Switzerland & little in franc and
Germany in its initial days. The first investment trust
“The foreign and colonial govt. trust” Was founded in
London in 1868.
 Advantages of Mutual Funds

•Diversification.
•Professional Management.
•Liquidity (mainly in case of opened mutual funds).
•Regulatory.
•Low cost.
•Reduction of transaction cost.
•Diverse returns.
•Advantages to Industrial concern.
•Tax relief.
•Attract foreign Capital.
•Reduction / Diversification of risk.
 Drawbacks of Mutual fund

•No guaranties.
•Fees & Commission.
•Taxes.
•Management Risk.
 HDFC Mutual Fund

HDFC mutual fund was set up on June 30, 2000 with two sponsors namely
Housing Development Finance Corporation ltd. and Standard Life Insurance ltd. HDFC
mutual fund came into existence on 10 Dec. 1999 and got approval from the SEBI on 3rd
July 2000.
Housing Development Finance Corporation Limited, more popularly known as HDFC
Bank Ltd, was established in the year 1994, as a part of the liberalization of the Indian
Banking Industry by Reserve Bank of India (RBI). It was one of the first banks to receive
an 'in principle' approval from RBI, for setting up a bank in the private sector. The bank
was incorporated with the name 'HDFC Bank Limited', with its registered office in
Mumbai. The following year, it started its operations as a Scheduled Commercial Bank.
Today, the bank boasts of as many as 1412 branches and over 3275 ATMs across India.

Products and Schemes of HDFC mutual fund

•Equity funds.
•Balanced funds.
•Debt funds.
•Liquid funds.
 Prudential ICICI Mutual Fund

The mutual fund of ICICI is a joint venture with

Prudential PLC. Of America, one of the largest life
insurance companies in the USA. Prudential ICICI mutual fund was set up on
13th of Oct. 1993 with two sponsors.
ICICI Bank started as a wholly owned subsidiary of ICICI Limited, an Indian
financial institution, in 1994. Four years later, when the company offered ICICI
Bank's shares to the public, ICICI's shareholding was reduced to 46%. In the
year 2000, ICICI Bank offered made an equity offering in the form of ADRs on
the New York Stock Exchange (NYSE), thereby becoming the first Indian
company and the first bank or financial institution from non-Japan Asia to be
listed on the NYSE. In the next year, it acquired the Bank of Madura Limited in
an all-stock amalgamation. Later in the year and the next fiscal year, the bank
made secondary market sales to institutional investors
 Other Players in Mutual Fund
•Bank of Baroda mutual fund (BOB MF) 30OCT. 1992.
•Benchmark mutual funds (June 12, 2001).
•Birla Sun life MF (1871).
•Chola mutual fund (3 Jan. 1997).
•Can bank mutual fund (Dec. 19, 1987).
•LIC mutual fund (19th June, 1989).
•Reliance mutual fund (30June, 1995).
•Sahara mutual fund (18 July, 1996).
•GIC (General Insurance Corporation of India).
•UTI
 Need of the study
•The need of study arises for learning the variables available that distinguish the mutual
fund of two companies.
•To know the risk & return associated with mutual fund.
•To chose best company for mutual investment between HDFC & ICICI.
•To project mutual fund as the ‘productive avenue for investing activities.

Scope of the study

•To make people aware about concept of mutual fund.
•To provide information regarding advantages and demerits of mutual fund.
•To advice where to invest or not to invest.
•To provide information regarding types of mutual fund which is beneficial for whom.

Objectives
.
•To analysis which provides better returns from HDFC &ICICI.
•To analyze the concept and parameters of mutual fund.
•To know how many people are satisfied by their investment (in HDFC or ICICI).
•To know people behavior regarding risk factor involved in mutual fund.
.
 Research Methodology
It is the way to systematically solve a problem. The methodology adopted in this study is
explained below:-
•Research Design
Problem Defining:
In a competitive situation with multiple mutual funds operating in Indian market, it is necessary to
know about the performance of different mutual funds as the performance of mutual fund decides
about the future of Mutual Fund Company. In this study my focus is upon performance of investors
regarding HDFC &ICICI. This is my problem to be studied for research.
Literature Survey:
I have used newspapers, magazines related to business & finance & apart from websites.
Type of research:
The research is qualitative & descriptive in nature. Qualitative research is that talk about the quality
of the subject to be researched and Descriptive research is one that describes things as exists in
present.
Data collection Design:
1.Sources of data =
I.Primary Sources – I have used questionnaire as primary source for collecting data
for my study.
II.Secondary sources – I had collected my secondary data from websites & journals.

2.Sampling =
It represents whole population. It is the processes of choosing a sample from whole
population .I have choose a sample of high class & middle class people who have invested in
mutual funds as a sample.
 3.Tools =
I have used some charts (Pie chart, column chart, cylinder chart, cone chart) and hypothesis
tests (chi-square one sample T- test etc.)

4..Sampling Size =
It represents that how many candidates you’ve chosen to be filled up your questionnaire or
candidates upon whom you can study. I had chosen sample of 100 candidates.

5.Sampling Techniques =
I.Deliberate &
II.Convenience Sampling.

6.Data Interpretation =
Data interpretation is that in which we analysis the whole collected data & tries to give it in simple
words to be understandable.
1. Do you invest in mutual fund?
.

YES 100

NO 0

Interpretation:-
All the candidates who are asked to fill the questionnaire have invested in mutual fund.

2. With which company do you have invested in mutual funds?

HDFC 65
ICICI 35
Reliance 0
SBI 0
LIC 0
Kotak Mahindra 0
Others 0

Interpretation:-
Out of 100 candidates up to 65have invested in mutual fund with HDFC & 35 have invested with ICICI. There is no investor who
have invested in mutual fund with any another company.
3. What is your age?

8
15-25
25-35 12
35-45 60
More than 45 20

Interpretation:
60 investors are of age between 35-45. 20 are of age more than 45. 12 are of between of 25-35. 8
are of 15-25. This data shows that many investors are of middle age & there are less investors of
young age in mutual fund.

4. What is your income? (Yearly based)

1 lakh 0

2-4 lakh 10

4-5 lakh 20

More than 5 70

Interpretation:
Up to 70 investors have income more than 5 lakh. 20 have between 4-5 lakh.10 investors have
income between 2-4 lakh & there is no investor who have income up to 1akh.
5. From where you come to know about this company’s mutual fund
schemes? Family & relatives 35

Friends & peers 40

Company employee 15

Others 10
Interpretation:
Many investors (up to 40) have been come to know about the company to be invested by their
friends & peers.35 have been known by their family & relatives .15have been come to know by
company employees & 10 by others. This means many have come to know by their friends & peers.

6. What is the time duration of your investment?

0-1 year 15

1-2 year 35

2-4year 30

more than 4 20

Interpretation:
15 investors have time of investment less than one year. 20 have time duration of their investment between of
1-2 year. 30 have between 2-4 year & 35 have more than 4 years.
So, we can say that 35 investors have more experience than others.
7. Are you satisfied by service of the company’s employees / people’s behavior?
Highly satisfied 15
Satisfied 35
Neutral 30
Dissatisfied 15
Highly Dissatisfied 5

Interpretation:
Out of 100 investors 15 are highly satisfied. 35 are satisfied. 30 are neutral towards employee
behavior of a company. 15 are dissatisfied. 5 are highly dissatisfied. We say that many people
are satisfied by employee behavior.

8. What is your risk profile?

Innovator 20

Moderate 65

Risk adverse 15

Interpretation:
20% investors are innovator means they like to take risk for more returns. 15% are moderate
towards risk means they are indifferent towards risk. 65% are risk adverse means they mainly try to
avoid risk.
9. What you feel about the company norms, documentation & formalities?
Highly Satisfied 15

Satisfied 25

Neutral 40

Dissatisfied 15

Highly dissatisfied 5

Interpretation:
15% investors are highly satisfied by company’s documentation policy (filling up the forms etc.). 25% are
satisfied, 40% never cares about it or are moderate towards it , 15% are dissatisfied by it & 5% are highly
dissatisfied.

10. What you say which provides better returns?

HDFC 68

ICICI 32

Interpretation:
According to collected data 68 investors thinks that HDFC provides better returns where as 32 to
think that ICICI provides better returns.
11. Would you like to exchange your investment with one another
between HDFC & ICICI?
Yes 15

No 85

Interpretation:
15 investors said that they would like to change their investment with each another between
HDFC & ICICI. But 85 investors say that they are ok with their companies and they wouldn’t like to
exchange their investment.
Findings: - In my research I have founded following things:-
•Investors have more faith HDFC’s mutual fund.
•As the age increases investors are much satisfied, see more risk & become more risk adverse.
•Old people &Widows prefer lower risk.
•Investors are not highly satisfied by company rules & employee behavior.
•Investors think that HDFC provides better returns than ICICI.
Limitations: - There are some limitations of my study, those are as
Following:-
•Sample limitation: - which sample is taken by me is very small in size to Compare mutual fund of
two companies.
•Reliability: - The data collected by me is not much reliable because many investors chosen by me
have invested in HDFC.
•Parameters: - All the parameters have not been taken.
•Time limitation: - I had the shortage of time because of that I was not able to do my study in a good
manner.
•Awareness: - Investors chosen for study are not fully aware of all the terms and conditions related
to mutual fund .So, it is very difficult to construct right information from them.
Recommendations / Suggestions: - In my study I have found some limitations. For that I can
suggest both companies following suggestions or areas of improvement:-
•ICICI bank should try to provide better returns to its investors as compare to HDFC.
•Both companies should try to invest in better securities for better profits.
•Both companies should try to satisfy their customer by better customer service or by improving
customer relationship management.
• Companies should try to make people initiative towards risk.
•Investors should be made fully aware of the concept of mutual fund & all the terms and conditions.
•It should more emphasize in advertising, as it is the most
Powerful tool to position ant brand in the mindsets of customers
 Conclusion: - To conclude we can say that mutual fund is a very much profitable tool
for investment because of its low cost of acquiring fund, tax benefit, and diversification of
profits & reduction of risk. Many investors who have invested in mutual fund have
invested with HDFC and them also thinks that it provides better returns than ICICI .There
is also an affect of age on mutual fund investors like; old people & widows want regular
returns than capital appreciation. Companies can adopt new techniques to attract more
& more investors. In my study I was suppose to do comparative analyses the mutual
fund of HDFC &ICICI and I had found that people consider HDFC better than ICICI. But
ICICI have also respondents and it can increase its investors by improving itself in some
terms.
•To conclude we can say mutual fund is a best investment vehicle for old & widow, as
well as to those who want regular returns on their investment.
•Mutual fund is also better and preferable for those who want their capital appreciation.
•Both the companies are doing considerable achievements in mutual fund industry.
•There are also so many competitors involved those affects on both companies.