INVESTMENT PATTERN &

PORTFOLIO MANAGEMENT OF
INVESTORS IN DELHI

Under the Guidance of : Presented By:

Ms. Chitwan Bhutani Sambhav Jain
Faculty Member, PCTE. MBA - 2A
 Insurance

How it works ?

Types:
1. Life Insurance
2. General Insurance
Life Insurance Companies Operating
In India
 Life insurance Companies in India
1. Bajaj Allianz Life Insurance Co. Ltd.
2. Birla Insurance Co. Ltd.
3. HDFC Standard Life Insurance Co. Ltd.
4.ICICI Prudential Life Insurance Co. Ltd.
5.Life Insurance Corporation of India.
6.Reliance Life Insurance Co. Ltd.
7.Sahara India Life Insurance Co. Ltd.
8.Tata AIG Life Insurance Co. Ltd.
9.Max New York Life Insurance Co. Ltd.
10.AEGON Religare Life Insurance Co. Ltd.
11.ING Vysya Life Insurance Co. Ltd.
12.Shriram Life Insurance Co. Ltd.
13.Star Union Dai-ichi Life.
14.SBI Life Insurance Co. Ltd
15.DLF Pramerica Life Insurance Co. Ltd.
16.Canara HSBC Oriental Bank of Commerce
Life Insurance Co. Ltd.
17.IDBI Fortis Life Insurance Co. Ltd.
18.Future Generali India Life Insurance Co.
Ltd. 
19.Bharti AXA Life Insurance Co. Ltd. 
20.Kotak Mahindra Old Mutual Life Insurance
Ltd.
21.Met Life India Insurance Co. Ltd.
22.Aviva Life Insurance Co. India Ltd.
 Life Insurance

Kal Par Control

 Corporate Background
1. Aviva is UK’s largest and amongst the biggest
insurance companies worldwide.
2. Aviva has a 53 million-customer base with
presence in 27 countries.
3. In India, Aviva has a joint venture with Dabur,
26 : 74.
4. Aviva has 195 Branches (including rural
branches).
5. Aviva has more than 30,000 Financial Planning
Advisers.
 Main business operations:

1. UK (Life, General Insurance and Health)

2. Europe
3. Asia Pacific
4. North America
5. Aviva Investors
 Channels Of Aviva

BSA Channel DSF Channel

Agency Channel
 Vision
“One Aviva, twice the value”.
 
Core Purpose
To provide prosperity and peace of mind for
our customers .
 Objectives
 
1. Manage composite portfolio
2. Build global asset management
3. Increase customer reach
 Management Team:
T R Ramachandaran
(Managing Director & Chief Executive
Officer)
Sumit Behl
Munish Sharda
Director, Business Risk & Internal Audit
Director, Direct Sales Force

Monica Agrawal
Rajeev Arora
(Director,Corporate
(Director, Finance & Actuarial)
Initiatives)

Vishal Gupta
Director, Marketing
Key Products
1. Aviva New LifeSaver Plus
2. Aviva New Pension Plus
3. Aviva New Young Scholar
SWOT Analysis Of Aviva’s BSA Channel
Strengths
Product Range
2. Experience

Weaknesses
1. Inadequate
Promotion Strategies
2. Low retention Rate
1.

SWOT Analysis of
BSA Channel

3. Lack of Interest of People

2. Changing Norms of
1. High Competition
Threats
2. Untapped market

IRDA
Growing Awareness 1.
Opportunities
Aviva’s Bancassurance Partners

PUNJAB & SIND BANK

 INDUSIND

 ABN AMRO

 LAKSHMI VILAS BANK LTD

 Corporate Social Responsibility

It is our belief in the power of education that has

fueled our endeavors to guarantee it, most
importantly to those who cannot afford it.
Through our Corporate Responsibility initiatives
we wish to empower as many children as we can.
 FINANCIAL ANALYSIS
Liquidity Ratios
2009 2008 2007

Current Ratio 1.90 2.30 2.20

Quick Ratio 1.10 1.10 1.00

Return Related
2009 2008 2007

Return on 9.90 12.00 12.50

Total
Assets (%)

Return on 20.60 13.50 14.40

Net Worth
(%)
Profitability
2009 2008 2007

Gross 30.20 30.80 31.50

Margin
(%)

Net Profit 6.60 5.50 6.10

Margin
(%)
Leverage
2009 2008 2007

Debt/ Equity 2.59 1.42 1.44

Ratio

Total Debt/ 0.69 0.55 0.54

Total Assets
Trend Analysis of Net Sales
YEARS SALES PERCENTAGE
2006-07 4777.64 100
2007-08 5208.38 109.02
2008-09 6106.43 127.81
 Trend
YEARS
analysis
EXPENSES
of Expenses
PERCENTAGE

2006-07 720.32 100

2007-08 792.62 110.04

2008-09 809.6 112.40

 Trend analysis of Net Profit
YEARS NET PROFIT PERCENTAGE
2006-07 291.12 100
2007-08 286.50 98.41
2008-09 401.52 137.92
What is an investment?

Types of Investments:
1. Economic
2. Financial
3. General
Characterstics of Investment

1. Return
2. Risk
3. Safety
4. Liquidity
 Importance Of Investment

1. Retirement planning
2. Increasing rates of taxation
3. Rates of interest
4. Inflation
5. Investment channels
 Investment Avenues
Equity Shares:
a) Ordinary
b) Preference
Debt Market Instruments:
c) Certificate of Deposit
d) Commercial Paper
e) Corporate Debentures
f) Floating Rate Bonds (FRB)
g) Government Securities
f) Treasury Bills
g) Bank/FI Bonds
h) PSU Bonds
i) Mutual Fund Schemes
Deposits
Life Insurance
Real Estate
Tax-sheltered saving schemes
Precious Objects
 What is Risk?
Types Of Risks:
Systematic risk:
a) Market risk
b) Interest rate risk
c) Purchasing Power risk
Unsystematic Risk:
d) Business risk
e) Financial risk
 Risk-Return Comparison Of
Various Investment Alternatives
 Purchasing
Management Market Business Interest
Investment Power
Decision Required Risk Risk Risk
Risk

H Growth stock H H L L

H Speculative common stock H H L L

M Blue chips M M L L

M Convertible referred stock M M L L

L Convertible debentures M M L L

L Corporate bonds L L H H

L Government bonds L L H H

L Short-term bonds L L L H

L Money market funds L L L H

 Portfolio

A combination of securities with different risk &

return characteristics will constitute the portfolio
of the investor.
Portfolio Design
Portfolio - Age Relationship
 Types of portfolio:

1. Random Portfolio
2. Sector Portfolio
P/E Ratio & Beta factor as a guide to
investment decisions
P/E Ratio:
Earnings per share alone mean absolutely
nothing. In order to get a sense of how expensive
or cheap a stock is, you have to look at earnings
relative to the stock price and hence employ the
P/E ratio.
P/E = Current Market Price
Earning Per Share
 Beta Factor

“Beta” indicates the proportion of the

yield of a portfolio to the yield of the
entire market (as indicated by some index).
If there is an increase in the yield of the
market, the yield of the individual portfolio
may also go up.
 Interpretation Of Beta
 

When B = 1 means that the scrip has same volatility as

compared to Index. Suitable for moderate investor.
 
When B>1 means that scrip is more volatile as
compared to market suitable for aggressive investors.
 
When B<1 then scrip is less volatile as compared to
market and suitable for defensive investors.
  
PORTFOLIO
  
 
 

AGGRESSIVE MODERATE
DEFENSIVE
 Title

Investment Pattern & Portfolio

Management of Investors in Delhi
 Objectives of the study
1. To know about the investment motive of an
investor of Delhi.
2. To provide knowledge to investor about risk
associated with various investment instruments.
3. To know which is the most preferred investment
option among the mid-aged investors of Delhi.
4. To know the factors which influence the choice of
investors.
 Research Methodology
Introduction:
Research is an academic activity and as such the
term should be used in technical sense.

Research Design:
Descriptive research design is used for collecting
primary data.
 Sampling Design
SAMPLING TECHNIQUE:
Non Probability technique. Under Non Probability
technique, Place Convenience Sampling was used.
UNIVERSE:
Universe in this study constitutes both males and females,
Above 25, in the whole world.
POPULATION:
Investors, above 25 years in Delhi city.
SAMPLING SIZE: 75 respondents.
SAMPLE UNIT: Any investor above 25 years in Delhi .
 Methods of Data Collection

Method Of Primary Data Collection:

The method followed in obtaining the primary data
was through the structured schedules.

Method of Secondary Data Collection:

1. Journals and Magazines
2. Internet
 Limitations of the Project

1. The research has been conducted with

a small sample size hence it does not
provide for generalization of the
results. 
2. Some of the respondents can hide the
real information.
3. Scarcity of time for completion of
project.
Data Analysis & Interpretation
 Figure 4.1 Profession (N=75)
45
42

40

35

31
30

25

No. of respondents
20

15

10

1 1
0
Business Retired Student Service
 4.2 Annual Income (N=75)
35

30 30
30

25

20

No. of respondents

15

12

10

5
3

0
Below Rs. 1.6 lakh Rs. 1.6-3.0 lakh Rs. 3.0-5.0 lakh Above Rs. 5 lakh
 4.3 Proportion Of Annual Income Invested (N=75)
40

35
35

30

25

20
No. of respondents
17

15
15

10
8

0
5-15% 15-25% 25-35% 35% Above
 4.4 Investment Motive (N=75)

30
28

25

21
20

15
15
No. of respondents

11
10

0
Some Current Income High Current Income Growth Of Asset Substantial Growth Of Asset
 4.5 Investments they feel comfortable owning (N=75)
20
19 19

18

16
15

14

12
11 11

10

No. of respondents
6

0
ld es es es te
Go ni ni riti sta
pa pa u
al
E
m m ec
co co t.S Re
ed ng Go
v
lish o wi
b gr
esta of
of ks
ks oc
oc St
St
 4.6 Most Preferred Investment Option (N=75)
35

30
30

25

20 19

No. of respondents

15

10
8 8

6
5 4

0
0
Stocks Govt. Securities Gold Real Estate FD/Savings Life Insurance Others
 4.7 Risk Tolerance (N=75)
50

45 44

40

35

30

25
No. of respondents

20
20

15

11
10

0
Low Medium High
 4.8 Acceptable Degree Of Volatility (N=75)
35

30
30

25
25

20

No. of respondents

15

11
10 9

0
Minimal Some Moderate Substantial
4.9 Time frame allowed for investment to reach its objective (N=75)
40

35 34

30

25

21
20
No. of respondents

15

11
10 9

0
1-5yrs 5-10yrs 10-15yrs 15yrs Above
 4.10 Criteria for choosing an investment (N=75)
30

25
24
23

20

15
14 14 No. of respondents

10

0
Liquidity Future Income Current Income Capital Growth
4.11 Consideration about inflation and its impact on portfolio (N=75)
50

45
43

40

35

30

25
No. of respondents
21
20

15

11
10

0
Low weightage Moderate weightage High weightage
 4.12 Revision Strategy (N=75)
35

32

30

26
25

20

17
No. of respondents

15

10

0
Conservative Maintaining Portfolio Aggressive
 Suggestions
1. Aviva should concentrate on building a more trustworthy
image in the eyes of investors.
2. People are willing to invest for a medium to long term to set
off the inflation factor hence products in that category
would be a good area for Aviva to concentrate.
3. Aviva should do extensive advertisement through every
media whether electronic, print, or hoarding etc.
4. The company should create awareness about the rules and
regulations of IRDA and its easy claim settlement procedure.
5. Aviva can benefit if people are made aware about ULIP’s
investment in mutual funds and various stocks, as they are
likely to invest into stocks anyway.
 Conclusion
 
1. According to my research people are
moderately bullish with regard to their risk
appetite.
2. People have moderate knowledge about
volatility, inflation and management of
their portfolio.
3. People are not interested in buying
insurance as an investment option.