A

PROJECT REPORT
ON
“THE STUDY OF VARIOUS INVESTMENT OPTIONS AND ANALYSIS OF
INVESTMENT PATTERN OF INVESTORS”
FOR
“AXIS BANK”
SUBMITTED TO

KALAHANDI UNIVERSITY.BHAWANIPATNA

IN PARTIAL FULFILLMENT OF THE

REQUIREMENT OF BACHELOR OF BUSINESS ADMINISTRATION (BBA)
Under the guidance of
Prof. BYOMKESH PRADHAN
Submitted by
BHAKTA SIKA
ROLL NO- 2101BBA04
SEMISTER-V

1
 PREFACE

Presenting this project report, "The Study of Various Investment Options

and Analysis of Investment Pattern of Investors," which I completed for Axis
Bank, gives me a great sense of satisfaction and accomplishment. This
project is the result of a great deal of investigation, evaluation, and
commitment to comprehending the complex world of investment options
and the astute behaviours of investors.

In the dynamic realm of finance, the significance of prudent investment

decisions cannot be overstated. The success of financial institutions, such
as Axis Bank, lies in their ability to comprehend the diverse preferences
and behaviours of investors. This project seeks to unravel the intricacies of
investment patterns, shedding light on the factors that influence decision-
making processes.

Undertaken by Bhakta Sika, a dedicated student with an inherent curiosity

for financial markets, this report embodies a comprehensive exploration
into the multifaceted world of investment. Bhakta Sika's commitment to
this research has been instrumental in delving into the nuances of investor
behaviour, risk appetite, and the myriad investment instruments available
in the market.

2
 ACKNOWLEDGEMENT
I would like to express my sincere gratitude to all those who have contributed to the
successful completion of my research project titled "The Study of Various Investment
Options and Analysis of Investment Patterns of Investors for Axis Bank."

First and foremost, I extend my heartfelt thanks to my esteemed Kalahandi University,

for providing me with the opportunity to pursue this research. I am deeply grateful for the
academic resources, infrastructure, and support that the university has offered throughout
my academic journey.

I am indebted to my research guide, Mr. Byomkesh Pradhan, for his invaluable guidance,
unwavering support, and expertise in the field of finance. His insightful feedback and
mentorship have been instrumental in shaping this research.

I would also like to extend my appreciation to the staff and management of Axis Bank for
their cooperation and willingness to provide essential data and insights for this study. Their
willingness to share information has been pivotal in conducting a comprehensive analysis.

Furthermore, I am grateful to my fellow students and friends for their encouragement and
assistance during the research process. Their suggestions and discussions have enriched the
quality of this project.

Finally, I express my heartfelt gratitude to my family for their constant encouragement,

patience, and support throughout my academic pursuits.

This research would not have been possible without the collective effort and
encouragement of all those mentioned above. Thank you for being a part of this academic
endeavour.

Date- Bhakta Sika

Place- 2101BBA04

3
 Declaration
I hereby declare that the work presented in this project report, titled
"THE STUDY OF VARIOUS INVESTMENT OPTIONS AND ANALYSIS OF
INVESTMENT PATTERN OF INVESTORS FOR AXIS BANK", is my own
original work and has not been submitted for any other degree or
diploma. I have taken reasonable care to ensure that the work is
accurate and up-to-date.

I have acknowledged all sources of information used in the project, and

I have obtained permission to reproduce any copyrighted material.

I am grateful to my supervisor, Prof. BYOMKESH PRADHAN, for their guidance

and support throughout the project.

Date- BHAKTA SIKA

Place- 2101BBA04

4
 Index

Chapter Page
particular No.
No.
1. Objectives of the study 2
Importance of the study 3
Scope of the study 4
Limitation of the study 5

2. Industry profile 7
Company profile 13

3 Theoretical background 35

4 Research methodology 43
Research design 44
5. Data analysis 49

6 Finding 66
Suggestion and Recommendation 69
Conclusion
71
7 Questionnaire 75
Bibliography 78

5
6
CHAPTER-1

1
 Objectives:

➢ To study the range of investment options offered by Axis bank

➢ To study the Investment pattern of the investors considering the various factors such

as age, monthly income, risk taking ability, need horizon, etc.

➢ To understand the basics of portfolio management

➢ To study the investment portfolios of the customers

2
 Importance of the study

➢ Market Insights: Understand trends in investor preferences for various

investment options like stocks, bonds, mutual funds, etc.

➢ Product Development: Refine and design new investment products tailored

to specific investor needs and risk tolerance.

➢ Client Targeting: Optimize marketing and customer outreach strategies

based on investor demographics and behaviour.

➢ Financial Literacy: Identify gaps in financial knowledge among investors and

create targeted educational programs.

➢ Risk Management: Assess and mitigate potential risks associated with

investor behaviour and market fluctuations.

3
 Scope of the study

➢ Identify key investment options offered by Axis Bank and its

competitors.

➢ Analyse risk-return profiles of available investment avenues.

➢ Assess demographics and financial profiles of typical Axis Bank

investors.

➢ Investigate factors influencing investor choices (risk

tolerance, goals, etc.).

➢ Quantify allocation patterns across different asset classes for

various segments.

4
 Limitation of the study

➢ Limited scope: Focused on Axis Bank customers, may not capture broader
investor trends.

➢ Sample bias: Potential non-randomness in chosen participants, affecting

generalizability.

➢ Subjective data: Self-reported information on investment patterns can be

prone to inaccuracies.

➢ Time constraints: Short study period might not reflect long-term investment
behaviour.

➢ Market dynamics: Excludes broader economic and market fluctuations

influencing investments.

5
Chapter-2

6
INDUSTRY PROFILE

7
 Introduction to industry
Without a sound and effective banking system in India, it cannot have a healthy economy.
The banking system of India should not only be hassle-free, but it should also be able to
meet new challenges posed by technology and any other external and internal factors.

For the past three decades, India’s banking system has had several outstanding
achievements to its credit. The most striking is its extensive reach; it is no longer confined
to only metropolitans or cosmopolitans in India. In fact, the Indian banking system has
reached even the most remote parts of the country. This is one of the main reasons for
India’s growth.

The government’s regular policy for Indian banks since 1969 has paid rich dividends with
the nationalisation of 14 major private banks in India.

Not long ago, an account holder had to wait for hours at the bank counters to get a draft
or withdraw his own money. Today, he has a choice. Gone are the days when the most
efficient bank transferred money from one branch to another in two days.

Now it is as simple as instant messaging or accessing it through a convenient mobile

application. Money has become the order of the day. The first bank in India, though
conservative, was established in 1786. From 1786 until today, the journey of the Indian
Banking System can be segregated into three distinct phases.

They are as mentioned below:

i. Early phase from 1786 to 1969 of Indian banks.

ii. Nationalization of Indian Banks and up to 1991 prior to Indian banking

sector Reforms. 9

iii. New phase of Indian Banking System with the advent of Indian Financial and
Banking Sector Reforms after 1991.
To make this write-up more explanatory, I prefix the scenario as Phase I,
Phase II and Phase III.
8
 Phase I:

The Genera; Bank of India was set up in the year 1786. Next came Bank of Hindustan and
Bengal Bank. The East India Company established Bank of Bengal (1806), Bank of Bombay
(1840) and Bank of Madras (1843) as independent units and called them Presidency Banks.
These three banks were amalgamated m 1921 and imperial Bank of India was established
which started as private shareholders banks, mostly Europeans shareholders.

In 1865 Allahabad Bank was established and first time exclusively by Indians, Punjab
National Bank Ltd. was set up in 1894 with headquarters at Lahore. Between 1885 and
1913, Bank of India Central Bank of India, Bank of Baroda, Canara Bank, Indian Bank, and
Bank of Mysore were set up Reserve Bank of India came in 1935.

During the first phase the growth was very slow and banks also experienced periodic
failures between 1913 and 1948. There were approximately 1100 banks, mostly small. To
streamline the functioning and activities of commercial banks, the Government of India
came up with the Banking Companies Act, 1949 which was later changed to Banking
Regulation Act, 1949 as per amending Act of 1965 (Act No. 23 of 1965). Reserve Bank of
India was vested with extensive power for the supervision of banking in India as the
Central Banking Authority.

During those day’s public has lesser confidence in the banks. As an aftermath deposit
mobilisation was slow. Abreast of it the savings bank facility provided by the Postal
department was comparatively safer. Moreover, funds were largely given to traders.

9
 Phase II:

Government took major steps in the Indian Banking Sector Reform after independence. In
1955, it nationalised Imperial Bank of India with extensive banking facilities on a large scale
specially in rural and semi urban areas. It formed State Bank of India to act as the principal
agent of RBI and to handle banking transactions of the Union and State Governments all
over the country.

Seven banks forming subsidiary of State Bank of India were nationalised on 19th July 1959.
In 1969, major process of nationalisation was carried out. It was the effort of the then
Prime Minister of India, Mrs. Indira Gandhi 14 major commercial banks in the country was
nationalised.

Second phase of nationalisation in Indian Banking Sector Reform was carried out in 1980
with six more banks. This step brought 80% of the banking segment in India under
Government ownership.

The following are the steps taken by the Government of India to Regulate Banking
Institutions in the country

i. 1949: Enactment of Banking Regulation Act.

ii. 1955: Nationalisation of State Bank of India.

iii. 1959: Nationalisation of SBI subsidiaries.

iv. 1961: Insurance cover extended to deposits.

v. 1969: Nationalisation of 14 major banks.

vi. 1971: Creation of credit guarantee corporation.

vii. 1975: Creation of regional rural banks.

10
 viii. . 1980: Nationalisation of 6 banks with deposits over 200 crores.

After the nationalisation the branches of the public sector banks in India rose to
approximately 800% and deposits and advances took a huge jump by 11,000%.

Banking in the sunshine of Government ownership gave the public implicit faith and
immense confidence about the sustainability of these institutions.

Phase III

This phase has introduced many more products and facilities in the banking sector in its
reforms measure. In 1991, under the chairmanship of M Narasimha, a committee was
setup by his name which worked for the liberalisation of banking practices.

The country is flooded with foreign banks and their ATM stations. Efforts are being made
to give a satisfactory service to customers. Phone banking and net banking is introduced.
The entire system became more convenient and swifter. Time is given more importance
than money.

The financial system of India has shown a great deal of resilience. It is sheltered from any
crisis triggered by any external macro-economic shock as other East Asian Countries
suffered. This is all due to a flexible exchange rate regime, the foreign reserves are high,
the capital account is not yet fully convertible, and banks and their customers have
limited foreign exchange exposure.

11
 Banking structure in Indian

Fig.1: Banking Structure in India

12
COMPANY PROFILE

13
 Introduction to the Organisation
Axis Bank Ltd.

Vision 2023:
Axis Bank envisions becoming a leading financial institution in 2023 by prioritising
innovation and customer-centric services. It aims to leverage digital technology, expand
its product offerings, and enhance financial inclusion. The bank seeks to maintain a strong
financial position, foster sustainable growth, and provide seamless banking experiences,
ultimately becoming a trusted partner for its customers and stakeholders.

Mission:

ABF's mission is based on the classical theory of development, wherein sustainable

livelihood is defined as a livelihood that can cope with and recover from stress and shocks,
maintain or enhance capabilities and assets (social, physical, and economic), and create
conditions that are suitable for better education, health, and sanitation-seeking behaviour
and sustainable livelihood for the next generation.

It aims to support programmes, projects, and activities that focus on creating conditions
suitable for sustainable livelihood. For this endeavour, ABF partners with civil society
organisations and provides them with financial, technical, and capacity-building support
to make positive contributions to the lives of underprivileged and vulnerable communities.

14
Core Values:

Customer Centricity

Ethics

Transparency

Teamwork

Ownership

Slogan:
Badhti ka naam zindagi

History:

Axis Bank established in 1993 was the first of the new private banks to have begun
operations in 1994 after the Government of India allowed new private banks to be
established. Axis Bank Ltd. has been promoted by the largest and the best Financial
Institution of the country, UTI. The Bank was set up with a capital of Rs. 115 crores, with
UTI contributing Rs. 100 crores, LIC – Rs. 7.5 crore and GIC and its four subsidiaries
contributing Rs. 1.5 crore each. Axis Bank is one of the first new generation private sector
banks to have begun operations in 1994. The Bank was promoted in 1993, jointly by
Specified Undertaking of Unit Trust of India (SUUTI) (then known as Unit Trust of India),
Life Insurance Corporation of India (LIC), General Insurance Corporation of India (GIC),
National Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental
Insurance Company Ltd. and United India Insurance Company Ltd. The shareholding of
Unit Trust of India was subsequently transferred to SUUTI, an entity established in 2003.

Erstwhile Unit Trust of India was set up as a body corporate under the UTI Act, 1963, with
a view to encourage savings and investment. In December 2002, the UTI Act, 1963 was
repealed with the passage of Unit Trust of India (Transfer of Undertaking and Repeal) Act,
2002 by the Parliament, paving the way for the bifurcation of UTI into 2 entities, UTI–I and
15
UTI–II with effect from 1st February 2003. In accordance with the Act, the Undertaking
specified as UTI I has been transferred and vested in the Administrator of the Specified
Undertaking of the Unit Trust of India (SUUTI), who manages assured return schemes
along with 6.75% US–64 Bonds, 6.60% ARS Bonds with a Unit Capital of over Rs. 14167.59
crores.

The Bank has strengths in both retail and corporate banking and is committed to adopting
the best industry practices internationally in order to achieve excellence.

Axis Bank entered a deal in November 2010 to buy the investment banking and equities
units of Enam Securities for $456 million. Axis Securities, the equities arm of Axis Bank,
will merge with the investment banking business of Enam Securities. As per the deal, Enam
will demerge its investment banking, institutional equities, retail equities and distribution
of financial products, and non–banking finance businesses and merge them with Axis
Securities

Services offered by the bank:

➢ Personal Banking
➢ Corporate Banking
➢ NRI Banking
➢ Priority Banking
➢ VBV – Online purchases using Credit Card
➢ VBV / MSC – Online purchases using Debit Card

Subsidiaries:

➢ The Bank has set up eight wholly-owned subsidiaries:

➢ Axis Capital Ltd.
➢ Axis Private Equity Ltd.
➢ Axis Trustee Services Ltd.
16
 ➢ Axis Asset Management Company Ltd.
➢ Axis Mutual Fund Trustee Ltd.
➢ Axis Bank UK Ltd.
➢ Axis Securities Ltd.
➢ Axis Finance Ltd.
➢ Accelyst Solutions Private Ltd.

Promoters:

17
shareholding pattern as on 07 July 2023

Business Performance Results at a Glance for the Financial year

2022-2023:

In every important area, Axis Bank's financial performance for the fiscal year 2022–2023
was excellent. Net interest income (NII) and fee income both saw strong year-over-year
growth, accounting for 17% of total income of 12,55,474 crores. While fee income

18
increased 34% YoY to 10,953 crores, NII increased 22% YoY to 47,369 crores. Core
operating profit reached 10,531 crores, up 16% year over year.

In every important area, Axis Bank's financial performance for the fiscal year 2022–2023
was excellent. Net interest income (NII) and fee income both saw strong year-over-year
growth, accounting for 17% of total income of 12,55,474 crores. While fee income
increased 34% YoY to 10,953 crores, NII increased 22% YoY to 47,369 crores. Core
operating profit reached 10,531 crores, up 16% year over year.

As of March 31, 2023, the percentage of net non-performing assets (NPAs) in total assets
decreased to 0.38%, indicating a stable asset quality for the Bank. The ratio of gross non-
performing assets to total advances dropped to 2.36%. As of March 31, 2023, the Bank's
capital adequacy ratio (CAR) was 16.79%, significantly above than the 12% legal minimum.

❖ As of June 30, 2023, the Bank's balance sheet had grown 13% year over year to
`13,02,839 crores. On a period-end basis, overall deposits increased by 17% YoY;
savings account deposits increased by 22% YoY, current account deposits by 23%
YoY, and total term deposits by 13% YoY and 2% QOQ.

Retail credit cards, personal loans, and home loans all saw significant growth,
accounting for 16% of the Bank's retail loan portfolio's year-over-year growth to
6,05,809 crores. The Bank's wholesale loan portfolio increased 18% YoY to 6,96,987
crores, mostly due to robust growth in loans for infrastructure, commercial vehicles,
and corporations.
Operating costs for the Bank increased 12% year over year to `11,372 crores. This
was caused by increased marketing and personnel costs.
For the fiscal year 2022–2023, the Bank's profit after tax (PAT) increased by 91%
year over year to `17,844 crores. This was the highest PAT the Bank had ever
documented.

19
 Steady asset quality, a persistent emphasis on cost control, and robust increase in
core operating profit propelled Axis Bank's financial performance in the fiscal year
2022–2023. In the upcoming quarters, the Bank is well-positioned to maintain its
growing momentum.

Some of the Investment Products available are as follows:

1) Fixed Deposits:
Concept:
Axis Bank offers multitudes of fixed deposit schemes for various durations.

Reinvestment Deposits:
In a reinvestment fixed deposit scheme, the interest accrued on your deposit at
the end of each quarter is invested along with the principal. The tenure of your
deposit must be a minimum of 6 months. At the end of the quarter, the interest
and the principal are both rolled over, and the interest is calculated on the total
sum net of Tax Deducted at Source (TDS)
• Automatic Rollover:
As a Fixed Deposit holder, you can avail of the facility for automatic rollovers on maturity
(for both the principal and interest). You can select this option in the Account Opening
Document (AOD). The options available are:

i) Rollover only Principal:

Only the principal amount of your fixed deposit will be rolled over. The interest will be
either credited to your designated account or paid out.

ii) Rollover Principal and Interest accrued in Reinvestment Deposit

scheme:
This will rollover both the deposit and the interest accrued for the same tenure at the
Interest Rates applicable on the maturity date

Liquidity:
The tenure of your fixed term deposit must be a minimum of 6 months.

Flexibility:
All encashment or withdrawals of Fixed Deposits can only be made at the
branch where the deposit was booked.

20
 Interest Calculations:
For fixed deposits with tenure of 6 months & above, interest is calculated on
a quarterly basis.

Interest earned during the previous quarter is added to the principal for
calculation of interest. Fixed deposit interest rate on this amount is
calculated every quarter.
For fixed deposits schemes with tenure of below 6 months, interest is
calculated at Simple Interest. Please note that the period of Fixed Deposit is
considered in number of days.

In the event the depositor chooses to receive the periodic interest payments
on a quarterly basis, interested is calculated and paid on quarterly rests.

Premature Encashment: deposit interest rate shall be rate applicable for the
period the deposit has remained with the bank or the contracted rate,
whichever is lower.

Tax at source is deducted as per the Income Tax regulations prevalent from
time to time.

Calculation of TDS in respect of interest on Fixed Deposits:

TDS in respect of interest earned on fixed deposits, is deducted on the basis of the
total interest projected on the aggregate of fixed deposits of the customer, for the
financial year.

Thus, if the total projected interest in a financial year crosses the threshold limit
which is presently Rs.10,000/-, TDS is deducted proportionately from the existing
fixed deposits at the time of interest application.

This is in accordance with Section 194 A 3 (i) (a) of the Income Tax Act.

2) Recurring deposits:
Concept:

➢ Recurring deposits are accepted in equal monthly instalments of minimum Rs 1,000 and
above in multiples of Rs 500 thereafter

➢ Recurring Deposit accounts can be opened for a minimum period of 12 months and in
multiples of 12 months thereafter, up to a maximum of 120 months.

21
 ➢ The amount of instalment once fixed, cannot be changed.

➢ Instalment for any calendar month is to be paid on or before the last working day of the
month. Where there is delay in payment of instalment, customer will be levied a penalty
@ PLR plus 4 % for the period of delay. Fraction of a month will be treated as full month
for the purpose of calculating the penalty.

➢ The total amount repayable to a depositor, inclusive of interest, depends on the amount
of monthly instalments and the period of deposit.

Liquidity:
The tenure of the recurring deposit must be a minimum of 6 months.
Flexibility:
All encashment or withdrawals of Fixed Deposits can only be made at the branch where
the deposit was booked.

Interest Calculations:
For Rupee Term Deposits of a contracted amount less than Rs 5 Crores opened/renewed
on or after May 1, 2014 (including Flexi deposits), interest rate shall be 1.00% below the
card rate, prevailing as on the date of deposit, as applicable for the period the deposit has
remained with the bank or 1.00% below the contracted rate, whichever is lower. However,
for Rupee Term Deposits closed within 14 days from the date of booking of the deposit
interest rate shall be rate applicable for the period the deposit has remained with the bank
or the contracted rate, whichever is lower.
For Rupee Term Deposits of a contracted amount of Rs 5 Crores and above, interest rate
shall be 1% below the card rate prevailing as on the date of deposit, as applicable for the
period the deposit has remained with the bank or 1% below the contracted rate,
whichever is lower. This would also be applicable on Rupee Term Deposits closed within
14 days from the date of booking of the deposit.
There would be no premature withdrawal penalty on NRE Term Deposits.

3) Public Provident Fund (PPF):

Concept:
Public Provident Fund (PPF) is one of the most popular savings-cum-tax saving
instruments in India. The PPF scheme serves as an excellent long-term savings
instrument which gives tax exemption on both the principal as well as interest.
22
Now you can open a PPF account at Axis Bank. Axis bank is now authorized by the RBI
and Ministry of Finance for collecting subscriptions under the Public Provident Fund
Scheme, 1968 on behalf of Central Government through 50 designated branches.

Features and benefits:

➢ Attractive interest rate
➢ High interest rate of 8.70% per annum with effect from 01 April’13 (Subject to
change as per govt. notification).
➢ Interest is calculated on the lowest balance between the close of the fifth day and
the last day of every month
➢ Safe long-term investment
➢ Extremely low risk investment with backing of Government of India.
➢ Tax benefits under section 80C
➢ Investments (under section 80C) made under PPF scheme falls under triple E
regimen i.e., Principal, Interest and Withdrawal are all tax exempted.
➢ Online access to View PPF Account balance online
➢ Transfer funds from linked Savings Bank Account to PPF Account
➢ View, save and print Mini and Detailed statements
➢ View and print subscription receipts for all the online payments made to the PPF
Account
➢ 24x7 accessibility through Internet Banking
➢ Option for loan facility and partial withdrawals
➢ Loan facility can be availed any time between third financial year to sixth financial
year i.e. From third financial year up to end of fifth financial year.
➢ 50% of the balance can be withdrawn after expiry of 5 years from end of year of
first subscription to the PPF Account.

3) Mutual Funds:
Concept:

23
 • Features & Benefits
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 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 a diversified, professionally managed basket of securities at
a relatively low cost.

• Axis bank Offering

As Axis Bank Financial Advisory team, we adopt strong research driven

recommendation model to help you choose the best funds based on qualitative and
quantitative parameters.

Apart from this, a dedicated Relationship Manager can also be assigned to you to
ensure that your investment requirements are taken care of, smoothly and
efficiently. Our advisors understand your profile and lead you through a structured
financial planning process to devise 31 financial solutions best suited to you. The
advisors will also help you choose the right investment products in line with your
investment goals.

We offer a unique 'One Page Portfolio Snapshot' report across investment products
to our customers investing in Mutual Funds. This report can be viewed through our
Internet Banking module.

Types of Mutual Funds

*By structure

➢ Open Ended

24
These are schemes that do not have a fixed maturity. The mutual fund ensures liquidity by
announcing sale and repurchase price for the unit of an open-ended fund.

➢ Closed Ended

These are schemes that have a fixed maturity. The money of the investor is locked in
for the period. Occasionally, closed-end schemes provide a re-purchase option to the
investors, either for a specified period or after a specified period. Liquidity in these
schemes is provided through listing in a stock market; however, this option is not yet
available in India.

*By Investment Objective

▪ Equity Schemes

Equity schemes primarily invest in shares. Based on the objective investments could be
in growth stocks where earnings growth is expected to be high or value stocks where
the view of the fund manager is that current valuations in the markets do not reflect
the intrinsic value. Various kinds of equity schemes are:

➢ Equity Diversified:

All non-theme and non-sector funds can be classified as equity diversified funds.

➢ Mid Cap:

These funds invest in companies from different sectors. However they put a restriction
in terms of the market capitalization of a company, ie, they invest largely in BSE Mid
Cap Stocks.

➢ ELSS:

ELSS is an open-ended equity growth scheme that is offered by mutual funds in line
with existing ELSS guidelines. The investments under this type of scheme are subject
to a locking period of 3 years and, as per the Finance Act 2005, are allowed the benefit
of income deduction up to Rs 1, 00,000.

25
 ➢ Thematic:

These schemes invest in various sectors but restrict themselves to a particular theme
e.g., services, exports, consumerism etc.

➢ Sector Specific:

These are schemes that invest in a particular sector for example IT. They have a high
degree of risk associated with them as if that particular sectors do not perform then
their returns will suffer.

➢ Flexicap:

These kinds of schemes invest across market caps.

▪ Debt or Income Schemes

Such a fund invests in interest bearing securities mainly government securities and
corporate bonds. This fund earns returns for its investors from interest income on its
investments and profits on trading securities. In terms of risk, this type of fund is the
least risky.

▪ Money Market Schemes

These schemes invest in short term debt instruments issued by the

government, corporate or banks. These are typically investments in short
term papers like the CPs and CDs etc.

▪ Hybrid Schemes
➢ Balanced Schemes:
➢ Balanced schemes invest in a mix of equity and debt. The debt investments
ensure a basic interest income, which the fund manager hopes to top with a
capital gain from the investment in equities. However loses can eat into basic
interest income and capital.
➢ Balanced Schemes:
26
 MIPs are suitable for conservative investors who along with an exposure to debt
do not mind a small exposure to equities. These funds aim to provide consistency
in returns by investing a major part of their portfolio in debt market instruments
with a small exposure to equities. Thus, an MIP would be suitable for
conservative investors who along with protection of capital seek some capital
appreciation as MIPs have an exposure to equities. However, the monthly
income is not assured.

Liquidity:

Open-ended schemes offer liquidity through on-going sale and repurchase facility. Thus,
the investor does not have to worry about finding a buyer for their investments.

Flexibility:

Mutual Funds offer flexibility in terms choosing a scheme that matches the investment to
an investor's investment objective.

Tax Benefits:

For equity funds, dividends received from equity schemes of Mutual Funds (i.e. schemes
with equity exposure of more than 65%) are completely tax-free. Neither does the Mutual
Fund have to pay dividend distribution fee nor does the investor have to pay income tax

4) Public Provident Fund (PPF):

Concept:

Public Provident Fund (PPF) is one of the most popular savings-cum-tax saving instruments
in India. The PPF scheme serves as an excellent long-term savings instrument which gives
tax exemption on both the principal as well as interest.

Now you can open a PPF account at Axis Bank. Axis bank is now authorized by the RBI and
Ministry of Finance for collecting subscriptions under the Public Provident Fund Scheme,
1968 on behalf of Central Government through 50 designated branches.

27
Features and benefits:

➢ Attractive interest rate

➢ High interest rate of 8.70% per annum with effect from 01 April’13 (Subject
to change as per govt. notification).
➢ Interest is calculated on the lowest balance between the close of the fifth
day and the last day of every month
➢ Safe long-term investment
➢ Extremely low risk investment with backing of Government of India.
➢ Tax benefits under section 80C
➢ Investments (under section 80C) made under PPF scheme falls under triple
E regimen i.e., Principal, Interest and Withdrawal are all tax exempted.
➢ Online access to View PPF Account balance online
➢ Transfer funds from linked Savings Bank Account to PPF Account
➢ View, save and print Mini and Detailed statements
➢ View and print subscription receipts for all the online payments made to
the PPF Account 30
➢ 24x7 accessibility through Internet Banking
➢ Option for loan facility and partial withdrawals
➢ Loan facility can be availed any time between third financial year to sixth
financial year i.e. From third financial year up to end of fifth financial year.
➢ 50% of the balance can be withdrawn after expiry of 5 years from end of
year of first subscription to the PPF Account.

5) ULIPFunds:

Concept:

A Unit-Linked Insurance Plan or a ULIP is a hybrid type of plan offered insurance companies
that gives you the benefit of both Insurance as well as Investments. In a ULIP, a part of the
premium that you pay is allocated towards insurance and the remaining is utilized for
28
investment in funds available within the plan. In this way, ULIP gives you both insurance
cover as well as returns on investment through a singular medium. MaxLife Fast Track Plan
by Axis Bank is a good example of a ULIP where you get to select from six funds and shorter
payment terms for quicker accumulation of returns through investment along with the
insurance cover.

Types of Funds under ULIP

While the specific nature of a fund varies from one plan to the other, the investment plans
under ULIPs are generally of three types: –

➢ Equity Funds – These funds are focused towards

towards investment in stock market where the risk-return ratio is 35 high. The Fund
performs in tune with the volatility present in the stock market.
➢ Debt Funds – These funds invest in debt instruments like Bonds where the returns
are comparatively lower as compared to equity but the risk is low as well.
➢ Balanced Funds – Hybrid funds which give you adequate exposure to stock market
as well as debt instruments. The risks accompanied by the equity portion are
balanced out by the safer investment in the debt portion.

Features of Unit Lined Insurance Plan (ULIP):

ULIPs initially had a lock-in period of 3 years but in 2012, IRDA (Insurance Regulatory and
Development Authority) intervened and defined new guidelines which changed the lock-
in period to 5 years. From a tax saving angle, ULIPs provide deduction under section 80C
of the Income Tax Act, 1961. ULIPs also have surrender options but it is important to note
here that if you have availed tax deduction from ULIP and surrendered it before the lock-
in period matures, then the deduction availed in the previous years will be considered as
a part of the income and will be taxed accordingly.

Like any other financial product, this insurance-cum-investment product has its own
features, some of which are very unique. The first such feature is the Top-Up in ULIP. What
that means is that you can invest over and above your annual premium amount. This top-
29
up can be directed towards the insurance component which results in the insurance cover
being increased or towards the investment component if the selected Fund is performing
well.

The second important feature is switching between funds. At the time you bought a ULIP,
you would have selected the best fund according to market conditions. However, it may
happen sometimes that the Fund doesn’t perform as well as anticipated or that the market
conditions change. In such an instance, you have the option to switch to a better
performing Fund and this is generally facilitated free of charge by most products up to a
certain number of switches in a year.

Some of the products under ULIP are:

1) Max Life Maxis:

Concept:
➢ A unit-linked life insurance plan
➢ Max Life Maxis, a unit-linked life insurance plan that helps in planning the
finances better by balancing the equity and debt exposure automatically, so that
the future years are the best years of life.
➢ Key Benefits

Wealth Creation with safety of funds:

Invest as per the risk appetite. Choose between six funds with the option to switch or
redirect savings between funds, free of charge Unique feature of “Dynamic Fund
Allocation” which automatically rebalances your portfolio depending upon years to
maturity Shorter Premium Payment Terms.

Option to choose Premium Payment Term from 7 years or 10 years as per your need

Flexibility of Protection Cover:

Option to choose insurance cover of 10/15/20 times the annual premium depending
upon your age
30
How dynamic fund allocation works for you?

Balances equity and debt exposure by automatic allocation of fund value as per
predetermined percentages. Please refer to the Table below

Higher allocation to equities in the initial policy years helps in generating potentially
higher returns

Higher allocation to debt as the policy nears maturity helps in protecting maturity
value.

2) Max Life Fast Track Super Plan:

Concept:
➢ A Non-Participating Unit Linked Insurance Plan
➢ Overview
The investments need a product that helps to achieve the goals, by providing with
portfolio strategies and multiple Fund options. Max Life Fast Track Super is a product
that helps in planning your finances better so that the future years are the best years
of life.
Key Benefits
Financial security for the family. The plan offers a Maturity Value equal to Fund
Value, Death Benefit equal to higher of (Fund Value, Sum Assured, 105% of
Premiums Paid) and also provides Partial Withdrawal flexibility Options of Premium
Payment Term and Policy Term to cater to the need
option available to Choose Single Pay or 5 Pay for 10 year Policy Term or Regular Pay
for 20 year Policy Term as per your need Increase the funds with Guaranteed Loyalty
Additions Additional units will get added to the Fund every year starting from 11th
policy year.
Investment Flexibility to Choose from 5 Fund Options The plan offers 5 fund options
that can chose from, basis risk appetite

31
Safeguarding your Fund against market volatilities with Systematic Transfer Plan and
Dynamic Fund Allocation
Choose from the two investment strategies to protect your Fund against market
volatilities
Maturity Benefit
On maturity, you will be eligible to receive an amount, provided settlement option
has not been exercised, equal to the Fund Value, where the Fund Value will be
calculated as:
Fund Value = Accumulated Units in Fund(s) X NAV of respective Fund(s) as on the
Maturity Date
Death Benefit
In case of Death of the Life Insured anytime during the term of the Policy, higher of
Sum Assured or Fund Value (as on the date of death), subject to a minimum of 105%
of all premiums paid, shall be payable.
Guaranteed Loyalty Additions
0.30% of fund value shall be added to the fund by creation of additional units, at
the end of every policy year starting from 11th policy year. The loyalty additions
increase by 0.02% (absolute) each year thereafter. The additional units shall be
created in different funds in proportion of Fund Value at the time of credit. Loyalty
additions will be payable only on Regular Pay for premium paying policies. In case
of revival of policies, the loyalty additions for previous years will be paid based on
the Fund Value prevailing at the revival date.
Systematic Transfer Plan
Systematic Transfer Plan helps you replicate a rupee cost averaging method on your
Annualized Premium. Where you have chosen the “Systematic Transfer Plan”
option, the Annualized/Single Premium received net of Premium Allocation Charge
shall be allocated first to the Secure Plus Fund to purchase Units. Immediately
thereafter and on each subsequent monthly anniversary, Fund Value of [1/(13-
month number in the policy year)] of the Units available at the beginning of the
32
month shall be Switched to Growth Super Fund automatically by cancelling Units in
the Secure Plus Fund, and purchasing Units in the Growth Super Fund.
Dynamic Fund Allocation
Dynamic Fund Allocation option is an investment strategy which in early part of
your policy term invests in equity-oriented funds and as your policy term progresses
it shifts the fund allocation towards more conservative funds. You can opt for
Dynamic Fund Allocation option only at the inception of policy. Under this option,
assets under management shall be maintained amongst Growth Super Fund and
Secure Fund in a pre-defined proportion that changes depending upon the years
left to maturity
Settlement Option
You may, at least fifteen (15) days prior to the Maturity Date, opt for a Settlement
Option, pursuant to which the Company will continue to manage the Funds for you
for a maximum period of five (5) years from the Maturity Date and make periodic
payments. Surrender
At any time during the Policy Term, you have the right to surrender the policy by
advising the Company in writing.
Discontinuance Terms
In case the premium is not paid by the premium due date, a Grace 40 Period of 30
days from the due date of first unpaid premium will be allowed. During this Grace
Period, the risk cover will continue and all charges under the policy will continue to
apply

33
CHAPTER -3

34
THEORETICAL
BACKGROUND

35
1 Introduction
In today's dynamic financial landscape, the study of various investment options and
the analysis of investment patterns among investors are of paramount importance.
As individuals and institutions seek to optimise their financial portfolios and
generate returns on their capital, the choices they make regarding investments can
have far-reaching consequences. Axis Bank, one of India's leading financial
institutions, serves as a valuable case study for understanding the complexities and
nuances of investment decision-making.

The world of investments encompasses a wide array of choices, ranging from

traditional avenues like fixed deposits and savings accounts to more sophisticated
options such as equities, mutual funds, real estate, and even cryptocurrencies. Each
of these investment instruments carries its own set of risks, rewards, and
considerations, making it crucial for both novice and seasoned investors to carefully
assess their choices.

Investment patterns are shaped by a multitude of factors, including economic

conditions, market sentiment, regulatory changes, individual financial goals, risk
tolerance, and demographic factors. By examining the investment patterns of Axis
Bank's customers, we can gain valuable insights into how these diverse factors
interact and influence investment decisions.

This study seeks to shed light on the following key objectives:

➢ To explore the wide range of investment options available to investors in the

financial market.
➢ To analyse the investment patterns exhibited by investors in the context of Axis
Bank's services and offerings.
➢ To understand the factors that influence investment decisions and the role of risk
management in these choices.
➢ To assess the alignment between investors' financial goals and their investment
strategies.
➢ To evaluate the impact of economic and market conditions on investment
decisions and portfolio performance.

Through a comprehensive examination of these objectives, this research aims to

provide valuable insights into the investment landscape, contributing to a better
understanding of investor behaviour and decision-making processes in the context
of Axis Bank's services. Ultimately, the findings of this study may serve as a valuable
resource for both individual investors and financial institutions seeking to navigate
the complex world of investments effectively.

Investing is a fundamental aspect of wealth creation and financial security. It

involves allocating resources to various assets with the expectation of generating
returns over time. The choice of investment avenues can significantly impact an

36
 individual's or institution's financial well-being, making it essential to explore the
wide spectrum of options available. These options range from conservative, low-risk
instruments like bonds and fixed deposits to higher-risk, potentially higher-reward
assets like stocks and venture capital investments.

Axis Bank, a prominent player in the Indian banking and financial sector, plays a
pivotal role in facilitating these investment decisions for its customers. The bank
offers a diverse range of financial products and services, making it an interesting
case study for understanding how investors navigate through the intricate web of
choices. Additionally, Axis Bank's customer base spans a wide demographic,
including retail customers, small and medium-sized enterprises (SMEs), and
corporate clients, providing a multifaceted view of investment behaviour.

Investment patterns among individuals and institutions can be influenced by a

plethora of factors. Economic conditions, both globally and domestically, can impact
investment sentiment. For instance, during periods of economic growth, investors
might be more inclined towards equities and riskier assets, whereas during economic
downturns, they might seek safer havens. Regulatory changes, tax implications, and
interest rate movements are other key drivers of investment decisions.

Personal financial goals and risk tolerance are also pivotal factors that shape
investment choices. Some investors prioritise capital preservation and prefer low-
risk, low-return investments, while others aim for aggressive growth and are willing
to take on higher risks. Demographic factors, such as age, income levels, and
investment experience, can further influence an investor's strategy.

Furthermore, the advent of digitalization and technological advancements has

transformed the investment landscape. Online trading platforms, robo-advisors, and
data analytics have made it easier for investors to access information, analyse
markets, and make informed investment decisions. Understanding how these
technological changes impact investment patterns is essential in today's financial
world.

In conclusion, the study of investment options and the analysis of investment patterns
with reference to Axis Bank represent significant undertakings. It enables us to
unravel the intricate interplay of financial markets, individual preferences, and
external factors. By gaining insights into these dynamics, individuals, financial
institutions, and policymakers can better navigate the evolving world of investments,
ultimately optimising their financial outcomes and enhancing economic stability.
This research aims to contribute to this understanding, shedding light on the
complexities and opportunities within the realm of investments.

2 Selection of organization
The choice of an organisation for a comprehensive study on investment options and
the analysis of investment patterns is a critical step in ensuring the relevance and
depth of the research. Several factors must be considered when selecting an
37
organisation for such a study. In this context, the selection of Axis Bank as the
organisation of focus offers distinct advantages and aligns with the objectives of the
research.

➢ Relevance and Significance: Axis Bank is one of India's leading private sector
banks, with a substantial presence in retail banking, corporate banking, and
wealth management. Its prominence in the financial sector makes it an ideal
subject for a study on investment options and patterns. The bank caters to a
diverse customer base, including individual investors, SMEs, and large
corporations, making it representative of a broad spectrum of investors.
➢ Diversity of Services: Axis Bank provides a wide range of financial products and
services, including savings accounts, fixed deposits, mutual funds, equities,
insurance, and more. This diversity of offerings allows for a comprehensive
analysis of various investment options within a single institution, offering insights
into how different investment products are utilized by investors.
➢ Demographic Representation: The bank serves customers from various
demographic backgrounds, including individuals from different age groups,
income levels, and risk appetites. This diversity in its customer base offers an
opportunity to study how different demographic factors influence investment
choices and patterns.
➢ Economic Relevance: Axis Bank operates in a dynamic economic environment,
which is characteristic of India's rapidly growing financial sector. Studying
investment patterns within this context can provide valuable insights into how
investors respond to economic fluctuations, regulatory changes, and market
conditions.
➢ Technological Integration: Axis Bank has embraced technological
advancements in the financial industry, offering online banking services, mobile
apps, and digital investment platforms. This technological integration enables the
exploration of how digitalization and fintech solutions impact investment
behaviour and preferences.
➢ Availability of Data: The availability of historical and real-time data from Axis
Bank's operations, customer transactions, and investment portfolios can provide
a robust foundation for conducting in-depth analysis and drawing meaningful
conclusions.
➢ Comparative Analysis: Axis Bank can also serve as a benchmark for
comparative analysis with other financial institutions, allowing for a broader
understanding of industry trends and investor behaviour.

In summary, the selection of Axis Bank as the focal organisation for this study is
well-founded in its significance, diversity of services, demographic representation,
economic relevance, technological integration, and data availability. By
concentrating on Axis Bank, this research can offer comprehensive insights into
investment options and patterns that reflect the complexities of the modern financial
landscape, benefiting both investors and financial institutions alike.

38
MEANING OF PORTFOLIO MANAGEMENT
Portfolio is a collection of assets. The asset may be physical or financial like Shares Bonds,
Debentures, and Preference Shares etc.
The individual investor or a fund manager would not like to put all his money in the shares
of one company, for that would amount to great risk. Main objective is to maximize
portfolio return and at the same time minimizing the portfolio risk by diversification.
Portfolio management is the management of various financial assets, which comprise the
portfolio. According to Securities and Exchange Board of India (Portfolio manager) Rules,
1993; "portfolio" means the total holding of securities belonging to any person; Designing
portfolios to suit investor requirement often involves making several projections regarding
the future, based on the current information. When the actual situation is at variance from
the projection’s portfolio composition needs to be changed. One of the key inputs in
portfolio building is the risk bearing ability of the investor. Portfolio management can be
having institutional, for example, Unit Trust, Mutual Funds, Pension Provident and
Insurance Funds, Investment Companies and non-Investment Companies.
Institutional e.g., individual, Hindu undivided families, Noninvestment Company's etc. The
large institutional investors avail services of professionals. A professional, who manages
other people's or institution's investment portfolio with the object of profitability, growth
and risk minimization, is known as a portfolio manager. The portfolio manager performs
the job of security analyst. In case of medium and large sized organization, job function of
portfolio manager and security analyst are separate. Portfolios are built to suit the return
expectations and the risk appetite of the investor.

BASIC CONCEPTS AND COMPONENTS FOR PORTFOLIO

MANAGEMENT
Now that we understand some of the basic dynamics and inherent challenges
organizations face in executing a business strategy via supporting initiatives, let’s look at
some basic concepts and components of portfolio management practices.

➢ The Portfolio
First, we can now introduce a definition of portfolio that relates more directly to the
context of our preceding discussion. In the IBM view, a portfolio is: One of a number of
mechanisms, constructed to actualize significant elements in the Enterprise Business
Strategy.
It contains a selected, approved, and continuously evolving, collection of Initiatives which
are aligned with the organizing element of the Portfolio, and, which contribute to the
39
achievement of goals or goal components identified in the Enterprise Business Strategy.
The basis for constructing a portfolio should reflect the enterprise's particular needs. For
example, you might choose to build a portfolio around initiatives for a specific product,
business segment, or separate business unit within a multinational organization.

➢ The Portfolio Structure

As we noted earlier, a portfolio structure identifies and contains a number of portfolios.
This structure, like the portfolios within it, should align with significant planning and
results boundaries, and with business components. If you have a product-oriented
portfolio structure, for example, then you would have a separate portfolio for each major
product or product group. Each portfolio would contain all the initiatives that help that
particular product or product group contribute to the success of the enterprise business
strategy.

➢ The Portfolio manager

This is a new role for organizations that embrace a portfolio management approach. A
portfolio manager is responsible for continuing oversight of the contents within a
portfolio. If you have several portfolios within your portfolio structure, then you will likely
need a portfolio manager for each one. The exact range of responsibilities (and authority)
will vary from one organization to another,1 but the basics are as follows:
• One portfolio manager oversees one portfolio. • The portfolio manager provides day-to-
day oversight. • The portfolio manager periodically reviews the performance of, and
conformance to expectations for, initiatives within the portfolio.
• The portfolio manager ensures that data is collected and analysed about each of the
initiatives in the portfolio. • The portfolio manager enables periodic decision making about
the future direction of individual initiatives.

➢ Portfolio Reviews and Decision Making

As initiatives are executed, the organization should conduct periodic reviews of actual
(versus planned) performance and conformance to original expectations. Typically,
organization managers specify the frequency and contents for these periodic reviews, and
individual portfolio managers oversee their planning and execution. The reviews should
be multi-dimensional, including both tactical elements (e.g., adherence to plan, budget,
and resource allocation) and strategic elements (e.g., support for business strategy goals
and delivery of expected organizational benefits).
A significant aspect of oversight is setting multiple decision points for each initiative, so
that managers can periodically evaluate data and decide whether to continue the work.
These “continue/change/discontinue" decisions should be driven by an understanding
(developed via the periodic reviews) of a given initiative's continuing value, expected
40
benefits, and strategic contribution, Making these decisions at multiple points in the
initiative's lifecycle helps to ensure that managers will continually examine and assess
changing internal and external circumstances, needs, and performance.

➢ Governance
Implementing portfolio management practices in an organization is a transformation effort
that typically involves developing new capabilities to address new work efforts, defining
(and filling) new roles to identify portfolios (collections of work to be done), and
delineating boundaries among work efforts and collections. Implementing portfolio
management also requires creating a structure to provide planning, continuing direction,
and oversight and control for all portfolios and the initiatives they encompass. That is
where the notion of governance comes into play. The IBM view of governance is:
An abstract, collective term that defines and contains a framework for organization,
exercise of control and oversight, and decision-making authority, and within which actions
and activities are legitimately and properly executed; together with the definition of the
functions, the roles, and the responsibilities of those who exercise this oversight and
decision-making.
Portfolio management governance involves multiple dimensions, including:
• Defining and maintaining an enterprise business strategy. • Defining and maintaining a
portfolio structure containing all of the organization's initiatives (programs, projects, etc.).
The basic objective of Portfolio Management is to maximize yield and minimize risk. The
other objectives are as follows: a) Stability of Income: An investor considers stability of
income from his investment. He also considers the stability of purchasing power of
income.
hi Capital Growth: Capital appreciation has become an important investment principle.
Investors seek growth stocks which provide a very large capital appreciation by way of
rights, bonus and appreciation in the market price of a share.
• Liquidity: An investment is a liquid asset. It can be converted into cash with the help
of a stock exchange. Investment should be liquid as well as marketable. The portfolio
should contain a planned proportion of high-grade and readily saleable investment.
• Safety: safety means protection for investment against loss under reasonably
variations. In order to provide safety, a careful review of economic and industry
trends is necessary. In other words, errors in portfolio are unavoidable and it
requires extensive diversification.
• Tax Incentives: Investors try to minimize their tax liabilities from the investments.
The portfolio manager has to keep a list of such investment avenues along with the
retum risk, profile, tax implications, yields and other returns.
41
Chapter-4

42
 RESEARCH
METHODOLOGY

43
 Research Methodology:
Research Methodology is a way to systematically solve the research problem. It may be
understood as a science of studying how research is done significantly. In it we study the
various steps that are generally adopted by a researcher in studying his research problem
along with the logic behind it. Research design plays an important role in collecting useful
information in cost effective manner. The flow of the research process is decided first
hand, so that the conduct of the research does not take an incorrect diversion from its
objective. Research comprises defining and redefining problems, formulating hypothesis,
collecting, organizing, evaluating data; making deduction and reaching conclusion and at
last carefully testing the conclusion to determine whether they fit the formulated
hypothesis:

Research Design:
Research design is nothing but the master plan for the actual research. It is a frame work
for carrying out research activities it comprises of series of prior decisions. Master plan for
this research for as follows: -

TYPE OF RESEARCH DESIGN:

There are three types of research designs used for the project

a) Descriptive &
b) Analytical

The source/ methods of data collection:

The data was collected extensively through the following methods:

Primary Methods

These are methods which are used to collect the data from the actual field. In these
methods questionnaires are prepared which have to be appropriate and limited containing

44
such which gives the full information. These questions are asked to the selected group of
people and information is collected.

Interview Method:

In this method the group of people is selected and the prepared questionnaires are
asked to them. Questions can be the open ended or close ended or both.

➢ Open-ended:

Questions are the questions, which are having explanatory answers, suggestion.

➢ Close-ended:

Questions are the questions which are having fixed answers. e.g.: Yes/No type of
questions.

➢ Oral interview:

In this method interviewer ask questions to interviewee orally and data is collected
in the record book

For the project, closed ended questions were asked and also oral interviews of few
customers were taken.

SECONDARY METHODS:
These are the methods, which are carried out to collect the data from indirect sources. In
this method one need not to go in the direct market to collect the Data. These methods
are:

➢ Data from the Axis bank:

In these methods the past data of the company is collected such market area, distribution
channels, product costing etc. Also, we get the information about the growth the company

➢ Data from the Internet:

45
This is of the latest methods of data collected. We can collect the information like
Company history, the product range of the company, company objectives and welfare
activities of company etc.

Sampling Techniques:
The sampling technique used was Convenient sampling. Convenience sampling is a non-
probability sampling technique where subjects are selected because of their convenient
accessibility and proximity to the researcher.

The subjects are selected just because they are easiest to recruit for the study and the
researcher did not consider selecting subjects that are representative of the entire
population. In all forms of research, it would be ideal to test the entire population, but in
most cases, the population is just too large that it is impossible to include every individual.
This is the reason why most researchers rely on sampling techniques like convenience
sampling, the most common of all sampling techniques. Many researchers prefer this
sampling technique because it is fast, inexpensive, easy and the subjects are readily
available.

In pilot studies, convenience sample is usually used because it allows the researcher to
obtain basic data and trends regarding his study without the complications of using a
sample. This sampling technique is also useful in documenting that a particular quality of
a substance or phenomenon occurs within a given sample. Such studies are also very
useful for detecting relationships among different phenomena

The survey process involved two phases: First phase included identification and selection
of the target audience to be studied and to determine the parameters on which
respondents will justify their preferences. The audience were targeted and analyzed
basically on the basis of two important parameters: Age, and Income. Demographical
information was also taken in order to know the investment patterns according to the
location, age etc. A questionnaire was designed to collect the needed information from

46
the respondents. In the second phase data was collected through questionnaire from
around 30 respondents within the branch. Results were viewed cautiously as sample was
from a specific population. The responses that were generated during this exercise were
converted in the form of percentages to have a comparative outlook, as the numbers itself
cannot explain the true picture. These percentages were then represented through the
simple tools like bar graphs; pie charts using MS excel software.

47
CHAPTER -5

48
DATA ANALYSIS:

49
 ❖ Age Distribution:
Age Group Population
18-25 27%
26-35 20%
36-50 40%
Above 50 Years 13%

Age Distribution

13%
27%
18-25 years
26-35 years
36-50 years

40% Above 50 years

20%

Graph1: Age Distribution

Interpretation:

1. Out of the total population under consideration, it was observed that 27% is lying in
the age group of 18-25 years, 20% of the population is lying between the age group of
26-35 years of age, 40% is lying in the age group of 36-50 years and 13% is lying in the
age group of above 50 years of age.

50
 ❖Income Distribution:

Income Distribution(monthly) Population

Less than 15000 10%

15000-30000 40%

30000-50000 23%

Greater than 50000 27%

Income Distribution (monthly) `

10%

27%

40%

23%

Less than 15000 15000-30000 30000-50000 Greater than 50000

Graph2: Income Distribution

Interpretation:

The maximum number of people who have their accounts with axis bank have
their monthly income on an average of 15000-30000 rupees.
51
 ❖ Investment horizon:

Age group Up to 1 years Up to 3 years Up to 5 years Up to 10 Greater

years than 10
years

18-25 years 12% 37% 46% 3% 2%

26-35 years 18% 45% 16% 4% 17%

36-50 years 25% 8% 34% 8% 10%

Greater than 50 20% 21% 30% 20% 9%

years

Investment horizons per age

upto 1 years upto 3 years upto 5 years

upto 10 years2 Greater than 10 years

50
45
40
35
30
25
20
15
10
5
0
18-25 years 26-35 years 36-50 years Greater than 50 years

Graph 3: Investment horizons per age

❖ Interpretation:
1. In the age group of 18-25 years maximum of the investors that is 46% of them have
their horizon as 5 years, around 37% of them have their investment horizon as upto 3
years. In the age group is 26-35 years 45% of the investors have upto 3 years. In the age
group of 36-50 years around 34% of the people have 5 years as their investment
horizon. And in the age group of greater than 50 years of age maximum people invest
for up to 1 year.

52
 ❖ Investment horizon as per Income:
Income Upto 1 Upto 3 Upto5 Upto 10 Greater
year year years year than 10
years
Less than 2 37 42 11 8
15000
15000- 17 33 25 12 13
30000
30000- 28 27 33 3 2
50000
Greater 22 33 34 1 11
than 50000
42

Upto 1 year Upto 3 year Upto 5 year Upto 10 year Greater than 10 year
37

34
33

33

33
28
27
25

22
17

13
12
11

11
8

3
2

LESS THAN 15000 15000-30000 30000-500000 GREATER THAN

50000

Graph 4: Investment horizons per income

Interpretation
➢ From the above graph it can be seen that 42% of total population under study in
the income group of less than 15000 average monthly income invest their money
for 5 years, in the income group of 15000-30000, 33% have up to 3 years of
horizon, in the income group of 30000-50000,33% have income horizon as up to
5 years and in the income group of greater than 50000, 34% invest for a horizon
of 5 years.

53
 ❖ Investment made in Products

Age FD ULIP MF ULIP+MF FD+Insurance Traditional Equity

group Insurance

18-25 13 25 20 5 12 13 20
26-30 20 10 15 22 13 10 10
36-50 37 5 25 16 8 8 10
Above 25 5 10 25 12 10 13
50

INVESTMENT MADE IN PRODUCTS AS PER AGE

GROUP
FD ULIP MF ULIP+MF FD+Insurance traditional Insurance Equity
37
25

25

25

25
22
20

20

20

16
15
13

13

13

13
12

12
10

10
10

10

10

10
8
8
5

18-25 YEARS 26-35 YEARS 36-50 YEARS ABOVE 50

YEARS

Graph 5: Investment made in Products as per Age Group

Interpretation
There has been a considerable rise in the percentage of the people who invest in FDs as
we go ahead considering the age and we can interpret that the young population
believes in taking risk and so they invest in the various other products also. People with
older age try to seek for security of their funds and thus opt for this option.

54
 ❖ Investment made in Products as per Income Group:

Income F ULIP MF ULIP+MF FD+Insu Traditiona Equit

D rance l y
Insurance
Less than 32 2 29 2 4 30 1
15000
15000- 42 25 15 1 7 1 9
30000
30000- 14 14 14 29 25 3 1
50000
Greater than 5 30 5 20 24 11 10
50000

INVESTMENT MADE IN PRODUCTS AS PER

INCOME GROUP
FD ULIP MF ULIP+MF FD+Insurance Traditional Insurance Equity
42
32

30

30
29

29
25

25

24
20
15

14
14
14

11
10
9
7

5
4

3
2

1
1

LESS THAN 15000 15000-30000 30000-50000 GREATERBTHAN

5000

Graph 6: Investment made in Products as per Income Group

• Interpretation:
➢ Studying the survey data reveals that according to the income group the
investment strategies opted by people differ according to the income
level.

➢ Income group with less than 15000 monthly incomes have their
investments majorly in the products like Fds, Mutual funds and
Traditional Insurance.

55
 ❖ Use of Maturity amount:
Use of Maturity Amount people

Investment in same products 50%

Investment in different products 17%

Use for other purpose 33%

Use of Maturity Amount

Graph 8: Use
of maturity
amount
33% Investment in same product
Investment in different product
50%
Use for other purpose

17%

• Interpretation:
➢ Out of the total population, about 50% of the people prefer investing their
money in the same investment option. This happens because, they either find
that the return on investment better, the product is suitable for their present
need, and if the services provided by the company are comparatively better
than those offered by others.
➢ 17% of the people invest in different investment options. Reason for which is
that they don’t want to be stereotypical, if better products are available which
satisfy their needs, if better investment returns are guaranteed by the other
product
➢ 33% of the people withdraw from their investments and use the money for
other purposes. Maybe the purpose was the ultimate goal of investment or
could be a possibility of other need of funds for which the person doesn’t
reinvest.

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 ❖ Re investment decision:

Age Reinvest in same Re invest in other No Reinvestment,

option option use for other
purpose
18-25 years 50 25 25
26-35 years 16 68 16
36-50 years 25 17 58.33
Greater than 50 0 0 100
years

Re investment decision as per age:

Reinvest in same option Re invest in other option No Reinvestment, use for other purpose

100
68

58.33
50

25

25

25

17
16

16

18-25 YEARS 26-35 YEARS 36-50 YEARS GREATER THAN 50

YEARS

Graph 9: Re investment decision as per age

Interpretation:
This report analyses investment patterns across age groups for Axis Bank. Younger
investors tend to embrace higher-risk options, while older investors prioritise capital
preservation through conservative choices like fixed deposits and annuities.

57
 ❖ Re investment decision as per Income:

Income Reinvest in same Re invest in other No Reinvestment,

option option use for other
purpose

Less than 15000 65 2 33

15000-30000 33 42 25
30000-50000 14 58 28
Greater than 50000 3 67 30

Reinvest in same option Re invest in other option No Reinvestment, use for other purpose

67
65

58
42
33

33

30
28
25

14

3
2

LESS THAN 15000 15000-30000 30000-50000 GREATER THAN

50000

Graph 10: Re investment decision as per Income

• Interpretation:
After going through the age and income reinvestment graphs, we can see that in
every age group and in every income group, people reinvest in the same company’s
product because the product can exactly suit their present needs of investment, has
higher returns on investment and that the services provided by the company are
good. If they invest in some other products, it is because of the variety of new
products coming up in the market with additional benefits to the investors.

58
 Type of Investors:

Age Conservative Balanced Aggressive

18-25 years 10 20 70
26-35 years 20 40 40
36-50 years 30 35 35
Above 50 years 50 48 2

Type of Investors as per Age:

Conservative Balanced Aggressive

70

50

48
40

40

35

35
30
20

20
10

18-25 YEARS 26-35 YEARS 36-50 YEARS ABOVE 50 YEARS

Graph 11: Type of investors as per age

• Interpretation:
The age brackets taken for the analysis are as follows:
18-25 years
26-35 years
36-50 years
Greater than 50 years.

59
➢ After analysing it was found that the major portion of the total population
under consideration lying in every group of age are safe investors. They do not
prefer taking risk while investing and like to maintain the risk-free portfolio.

➢ Survey shows that in age group 18-25 years and 26-35 years, there exists the
population which is willing to take considerable amount of risk which was
analysed and found that around 70% of the population lying in the age group of
18-25 years are aggressive when it comes to investments and 40% of the
population lying in the age group of 26-50 years are aggressive investors. As
these belong to the youth of India and a part of its growing economy, their
savings have increased and this is the outcome of their savings.

➢ The traits of an aggressive investors can be derived out of their risk-taking

capacity, their willingness to invest in the new products, the comfortless to
bear the up and downs in the investment values, their preferences for the
portfolio diversification so as to how much of their funds to be invested in the
high risk and high returns products and how much do they allocate their fund
for the low risk and low returns products.

➢ As we progress along the age groups, it is seen that a person tries to safeguard
his hand earned money and this behaviour can be clearly seen in the age group
of above 50 years where the percentage of aggressive investors is
approximately 0.

➢ Whereas the percentage for the balanced in vestors is moderate throughout all
the age groups.

60
❖ Type of Investors as per Income:

Income Conservative Balanced Aggressive

Less than 33 33 34
15000
15000-30000 16 42 42

30000-50000 14 57 29

Greater than 5 63 32
50000

Conservative Balanced Aggressive

63
57
42

42
34
33

33

32
29
16

14

LESS THAN 15000 15000-30000 30000-50000 GREATER THAN

50000

Graph 12: Type of investors as per Income

• Interpretation:

➢ As per the survey conducted, it was observed that in the income group
of less than 15000 average monthly income have fairly conservative
investors but as we go ahead with the income groups, the number of
balanced investors and aggressive investors increase.

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❖ Reason for Investment:
Reason for investment People

Increase in wealth and opportunity for 47%

growth

Monthly Income generation 20%

Safety of Principal 20%

Liquidity in terms of cash convertibility 13%

REASON FOR INVESTMENT

Increase in wealth and opportunity for growth Monthly Income generation
Safety of Principal Liquidity in terms of cash convertibility

13%

20% 47%

20%

Graph 13: Reason for investment

• Interpretation:
➢ . Out of the total sample that was considered for analysis, around 47% of
the people invest their money in order to increase their wealth and also
when they feel that a particular product is fit as an opportunity for
growth of their wealth. Steady growth of funds is expected by these
kinds of people and thus they invest in the products which satisfy their
needs of stable growth.

62
 ❖ Portfolio Preference:
Age Portfol Portfolio 2 Portfolio 3 Portfolio 4 Portfolio 5
io 1
18-25 year 0 50 26 12 12
26-35 year 0 17 17 49 17
36-50 year 0 24 58 9 9
Greater than 0 0 25 50 25
50 years
Portfolio Preference as per Age:

Portfolio 1 Portfolio 2 Posrtfolio 3 Portfolio 4 Portfolio 5

58
50

50
49
26

25
25
24
17
17

17
12
12

9
9
0

0
0

18-25 YEARS 26-35 YEARS 36-50 YEARS GREATER THAN

50 YEARS

Graph 14: Portfolio preference as per age

Here, Portfolio 1: 100% of the total funds to be invested in high-risk high return funds
and 0% to be invested in low-risk low return funds
Portfolio 2: 75% of the total funds to be invested in high-risk high return funds and 25%
to be invested in low-risk low return funds
Portfolio 3: 50% of the total funds to be invested in high-risk high return funds and 50%
to be invested in low-risk low return funds
Portfolio 4: 25% of the total funds to be invested in high-risk high return funds and 75%
to be invested in low-risk low return funds
Portfolio 5: 0% of the total funds to be invested in high-risk high return funds and 100%
to be invested in low-risk low return fund

Inference:
➢ According to the survey, the age group 18-25 years, prefer portfolio 2 the most.
Around 50% of the people in that age group prefer portfolio 2

➢ As we progress along the age groups, people prefer investments with low risk
returns.
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❖Portfolio preference as per Income:
Income Portfolio Portfolio Portfolio Portfolio Portfolio
1 2 3 4 5
Less than 0 33 33 0 34
15000
15000- 0 25 14 50 0
30000
30000- 0 28 14 56 0
50000
Greater 0 25 50 25 0
than
50000

Portfolio 1 Portfolio 2 Portfolio 3 Portfolio 4 Portfolio 5

56
50

50
34
33
33

28
25

25

25
14

14
0
0

LESS THAN 15000 15000-30000 30000-50000 GREATER THAN

50000

Graph 15: Portfolio preference as per Income

Inference:
➢ As we progress along the income groups, it is observed through the survey that
higher the income group, higher is the investment in the portfolios with high
risk and high returns funds.

64
CHAPTER-6

65
FINDINGS

66
 FINDINGS

• The maximum number of people who have their accounts with axis
bank have their monthly income on an average of 15000-30000 rupees.

• It has been revealed from the survey that in any age group or income group, the
most preferred investment horizon for investors in either up to 3 years or up to 5
years. This is due to the change in the interest rates and different investment
options available with the investors. also, in today’s economy customers do not go
in for very large duration of investment schemes.

• There has been a considerable rise in the percentage of the people who invest in
FDs as we go ahead considering the age and we can interpret that the young
population believes in taking risk and so they invest in the various other products
also. People with older age try to seek for security of their funds and thus opt for
this option

• They themselves find the need to invest their money and they chose the
investment products themselves by self-introspection. Self-analysis helps to find
the needs of oneself and thus accordingly one can make investments.

• Majority of the people prefer investing their money in the same investment
option. This happens because, they either find that the return on investment
better, the product is suitable for their present need, and if the services provided
by the company are comparatively better than those offered by others

• In age group 18-25 years and 26-35 years, there exists the population which is
willing to take considerable amount of risk. in the age group of 18-25 years are
aggressive when it comes to investments and most of the population lying in the
age group of 26-50 years are aggressive investors. As these belong to the youth of
India and a part of its growing economy, their savings have increased and this is
the outcome of their savings. As we progress along the age groups, it is seen that a
person tries to safeguard his hand earned money and this behaviour can be clearly
seen in the age group of above 50 years where the percentage of aggressive

67
 investors is approximately 0. Similarly, as we go ahead with the income groups, the
number of balanced investors and aggressive investors increase.

• Most of the people invest their money in order to increase their wealth and also
when they feel that a particular product is fit as an opportunity for growth of their
wealth.
• Steady growth of funds is expected by these kinds of people and thus they invest
in the products which satisfy their needs of stable growth.

• It has been clearly observed that the risk-taking capacity for a person is dependent
on the average monthly income of a person. There is a gradual increase in the risk-
taking capacity as we move forward as per the income groups.

• As we progress along the income groups, it is observed through the survey that
higher the income group, higher is the investment in the portfolios with high risk
and high returns funds

• People reinvest in the same company’s product because the product can exactly
suit their present needs of investment, has higher returns on investment and that
the services provided by the company are good. If they invest in some other
products, it is because of the variety of new products coming up in the market
with additional benefits to the investors.

• It has been found that the overall investment decision of a person completely
relies on his age, income, risk taking capacity, influence from people etc.

68
RECOMMENDATIONS
&
SUGGESTION

69
 Recommendation and suggestion

• The profile of the investor should be carefully scrutinized and a proper investment
suggestion should be given to the customer

• Awareness regarding the new products of the bank must be spread among the
banking customers

• Investors should be motivated to invest in various options which match their risk-
taking capacity and thus diversify their portfolio.

• Review existing literature on investment options and investor behaviour to establish

a foundation for the study.

• Examine how digital platforms and technology affect investing choices, and suggest
ways that Axis Bank might profit from this development.

• Talk about the current regulatory framework that controls investments and suggest
any modifications or enhancements that would be advantageous to both Axis Bank
and investors.

• Make recommendations for Axis Bank's efforts to raise investor knowledge and
understanding of various investment products.

• Examine how digital platforms and technology affect investing choices, and suggest
ways that Axis Bank might profit from this development.

• Analyse investors' expectations for return on their investments.

• Talk about the current regulatory framework that controls investments and suggest
any modifications or enhancements that would be advantageous to both Axis Bank
and investors.

• Based on the study's findings, provide Axis Bank specific recommendations on

product improvements, marketing tactics, and customer engagement programmes.
70
CONCLUSION

71
 CONCLUSION
There’s a variety of investment products available with the bank. It is very essential to
find out the need of the customer, study his objective of investment, other traits like his
nature of investment i.e. to find out whether he is risk averse or an aggressive investor,
his capacity to face the ups and downs of the market and most importantly his horizon
for investment, and accordingly a suitable mix of products can be suggested to the
customer.
Various other factors also affect the investment decision of customer. The careful
scrutinization of the products and also the various advantages derived out of it must be
considered like example the tax benefits offered by certain products. Let us consider
some of them
The above stated table gives an account of the equations to be considered while
investing in the various investment options that is while designing a portfolio.

From the analysis which was conducted, it has been clear that Hypothesis Ho: Age
and Income has no impact on the portfolio preference of the investors is rejected.

Thus, alternative hypothesis Ha: Age and Income has impact on the portfolio
preference of the investors is accepted.

72
CHAPTER-7

73
ANNEXURE

74
 Survey Questionnaire
Dear respondent this survey is carried to find the investment behaviour of
consumers and is for academic purpose only, all your disclosures will be kept
confidential.
Respondent details
Name………………………………
Address:………………………………………………………………………… …………………..
Ph no:…………………………………..

Please tick mark the suitable option.

1. What is your present age?
a) 18 — 25 yrs.
b) 26 — 35 yrs.
c) 36 — 50 yrs.
d).>50 yrs.
2. What is your monthly income?
a) up 1> 15000
b) 15000 — 30000
c) 30000 — 50000
d) > 50000
3. What is your investment horizon?
a) up to 1 year
b) up to 3 years
c). up to 5 years
d) up to 10-year s
e) greater than 10 years
12. How best would you describe your saving habits over the years?
a) After covering living expenses I am able to save substantial amounts regularly
b) After covering living expenses I am able to save some amounts regularly
75
c) Afer covering living expenses I am only able to save some amount on an ad-hoc
basis
d) After covering the living expenses I am hardly able to save
e) I am not able to save at all
4. Which of the following Investment options would you prefer the most?
a) ULIP b) Mutual fund
c) Fixed deposit
d) Traditional insurance
e) UL1P+ MF
f) FD+ insurance
e) Equity
5. What factors would you consider most important before choosing an
investment option?
a) how quickly I will be able to increase my wealth
b) the opportunity for steady growth
c) the amount of monthly income the investment will generate
d) the safety of my investment principal amount
e) Liquidity in terms of cash convertibility
6. Your financial investment are influenced /based on which of the following?
a) information received by broker agent
b) influence of peers
c) self-analysis and introspection
d) Information delivered through Media (advertisement/news)
7. What would you prefer doing on the realisation of the maturity amount of your
investment?
a) reinvest in same investment options
b) invest in other investment options
c) use for other purpose
8. If u reinvest do u go with same product?

76
a) yes, if product is suitable for my present need
b) yes, if return on investment is better
c) yes, if service and returns provided are comparatively better.
9. As an investor, how do you describe your willingness to take financial risk?
a) I am comfortable taking ona higher level of risk, knowing it may mean higher
returns
b) I am willing to take calculated risks, knowing it may mean high returns
c) I am happy with the moderate level of risk
d) I am fairly conservative, but can take on a small level of risk
e) I am a conservative investor and I am completely risk averse

10. Which of the following mix of investments do you find most appealing for your
portfolio?
High risk-High return Low risk-Low
return
a Portfolio 1 100% 0%
b Portfolio 2 75% 25%
c Portfolio 3 50% 50%
d Portfolio 4 25% 75%
e Portfolio 5 0% 100%

11. Investments can go up and down in value. By how much could the total value
of your investments go down before you begin to feel uncomfortable?
a) 35% and more
b)30%
c)20%
d)10%
e) Any fail would make me uncomfortable 8

77
 BIBLIOGRAPHY
• www.investopedia.com

• www.wikipedia.com

• www.axisbank.com

• www.birlasunlife.com

• www.managementstudyguide.com

• Banking – Theory, Law &PracticeE.Gordon&K.Natraj

• Investments by Zvi Bodie, Alex Kane, and Alan J. Marcus

• Mutual Funds Explained by Jeffrey R. Fearon
• Axis Bank Annual Report
• The Economic Times
• Bloomberg Businessweek

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