INDUSTRY PROFILE

Following diagram gives the structure of Indian financial system:

INDUSTRY PROFILE: MUTUAL FUNDS:

Mutual funds go back to the times of the Egyptians and Phoenicians when they sold shares in
caravans and vessels to spread the risk of these ventures. The foreign and colonial
government Trust of London of 1868 is considered to be the fore-runner of the modern
concept of mutual funds. The USA is, however, considered to be the Mecca of modern
mutual funds. By the early - 1930s quite a large number of close - ended mutual funds were
in operation in the U.S.A. Much latter in 1954, the committee on finance for the private
sector recommended mobilization of savings of the middle class investors through unit trusts.
Finally in July 1964, the concept took root in India when Unit Trust of India was set up.

INDIAN MUTUAL FUND INDUSTRY

The end of millennium marks 36 years of existence of mutual funds in this country. The ride
through these 36 years is not been smooth. Investor opinion is still divided. While some are
for mutual funds others are against it.

UTI commenced its operations from July 1964 .The impetus for establishing a formal
institution came from the desire to increase the propensity of the middle and lower groups to
save and to invest. UTI came into existence during a period marked by great political and
economic uncertainty in India. With war on the borders and economic turmoil that depressed
the financial market, entrepreneurs were hesitant to enter capital market.

The already existing companies found it difficult to raise fresh capital, as investors did not
respond adequately to new issues. Earnest efforts were required to canalize savings of the
community into productive uses in order to speed up the process of industrial growth.

The then Finance Minister, T.T. Krishnamachari set up the idea of a unit trust that would be
"open to any person or institution to purchase the units offered by the trust. However, this
institution as we see it, is intended to cater to the needs of individual investors, and even
among them as far as possible, to those whose means are small."

His ideas took the form of the Unit Trust of India, an intermediary that would help fulfill the
twin objectives of mobilizing retail savings and investing those savings in the capital market
and passing on the benefits so accrued to the small investors.

UTI commenced its operations from July 1964 "with a view to encouraging savings and
investment and participation in the income, profits and gains accruing to the Corporation
from the acquisition, holding, management and disposal of securities." Different provisions
of the UTI Act laid down the structure of management, scope of business, powers and
functions of the Trust as well as accounting, disclosures and regulatory requirements for the
Trust.

One thing is certain – the fund industry is here to stay. The industry was one-entity show till
1986 when the UTI monopoly was broken when SBI and Can bank mutual fund entered the
arena. This was followed by the entry of others like BOI, LIC, GIC, etc. sponsored by public
sector banks. Starting with an asset base of Rs. 25 crore in 1964 the industry has grown at a
compounded average growth rate of 27% to its current size of Rs.90000 crore.

The period 1986-1993 can be termed as the period of public sector mutual funds (PMFs). From
one player in 1985 the number increased to 8 in 1993. The party did not last long. When the
private sector made its debut in 1993-94, the stock market was booming.

The openings up of asset management business to private sector in 1993 saw international players
like Morgan Stanley, Jardine Fleming, JP Morgan, George Soros and Capital International along
with the host of domestic players join the party. But for the equity funds, the period of 1994-96
was one of the worst in the history of Indian Mutual Funds.

1999—YEAR OF THE FUNDS

Mutual funds have been around for a long period of time to be precise for 36 yrs but the year
1999 saw immense future potential and developments in this sector. This year signaled the
year of resurgence of mutual funds and the regaining of investor confidence in these MF’s.
This time around all the participants are involved in the revival of the funds ----- the AMC’s,
the unit holders, the other related parties. However the sole factor that gave lifer to the revival
of the funds was the Union Budget. The budget brought about a large number of changes in
one stroke. An insight of the Union Budget on mutual funds taxation benefits is provided
later.

It provided centre stage to the mutual funds, made them more attractive and provides
acceptability among the investors. The Union Budget exempted mutual fund dividend given
out by equity-oriented schemes from tax, both at the hands of the investor as well as the
mutual fund. No longer were the mutual funds interested in selling the concept of mutual
funds they wanted to talk business which would mean to increase asset base, and to get asset
base and investor base they had to be fully armed with a whole lot of schemes for every
investor .So new schemes for new IPO’s were inevitable. The quest to attract investors
extended beyond just new schemes. The funds started to regulate themselves and were all out
on winning the trust and confidence of the investors under the aegis of the Association of
Mutual Funds of India (AMFI)
One cam say that the industry is moving from infancy to adolescence, the industry is
maturing and the investors and funds are frankly and openly discussing difficulties
opportunities and compulsions.

First Phase – 1964-87:

Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by
the Reserve Bank of India and functioned under the Regulatory and administrative control of
the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial
Development Bank of India (IDBI) took over the regulatory and administrative control in
place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988
UTI had Rs.6,700 crores of assets under management.

Second Phase – 1987-1993 (Entry of Public Sector Funds):

1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks
and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India
(GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987
followed by Canbank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89),
Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund
(Oct 92). LIC established its mutual fund in June 1989 while GIC had set up its mutual fund
in December 1990

At the end of 1993, the mutual fund industry had assets under management of Rs.47, 004
crores.

Third Phase – 1993-2003 (Entry of Private Sector Funds):

With the entry of private sector funds in 1993, a new era started in the Indian mutual fund
industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year
in which the first Mutual Fund Regulations came into being, under which all mutual funds,
except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged
with Franklin Templeton) was the first private sector mutual fund registered in July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and
revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI
(Mutual Fund) Regulations 1996. The number of mutual fund houses went on increasing,
with many foreign mutual funds setting up funds in India and also the industry has witnessed
several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds
with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of
assets under management was way ahead of other mutual funds.
Fourth Phase – since February 2003 In February 2003:

Following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two
separate entities. One is the Specified Undertaking of the Unit Trust of India with assets
under management of Rs.29, 835 crores as at the end of January 2003, representing broadly,
the assets of US 64 scheme, assured return and certain other schemes. The Specified
Undertaking of Unit Trust of India, functioning under an administrator and under the rules
framed by Government of India and does not come under the purview of the Mutual Fund
Regulations. The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and
LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of
assets under management and with the setting up of a UTI Mutual Fund, conforming to the
SEBI Mutual Fund Regulations, and with recent mergers taking place among different private
sector funds, the mutual fund industry has entered its current phase of consolidation and
growth. As at the end of September, 2004, there were 29 funds, which manage assets of
Rs.153108 crores under 421 schemes.
PRESENT ASSET UNDER MANAGEMENT OF MUTUAL FUND
COMPANIES:

AVERAGE SUM OF MUTUAL FUND COMPANIES FOR THE MONTH

Excluding fund Fund of Excluding fund fund of

 Of funds Funds of funds funds

1. ABN AMRO Mutual Fund 687443.08 36549.73 626525.88 35964.53

2. AIG Global Investment Group

N/A N/A N/A N/A
Mutual Fund

3. Benchmark Mutual Fund 641785.64 0 543258.09 0

4. Birla Sun Life Mutual Fund 2371946.37 1905.17 2177700.58 1890.64

5. BOB Mutual Fund 9759.11 0 10249.22 0

6. Can bank Mutual Fund 291004.49 0 267091.92 0

7. DBS Chola Mutual Fund 247308.99 0 211747.28 0

8. Deutsche Mutual Fund 728368.45 0 718837.47 0

9. DSP Merrill Lynch Mutual Fund 1185328.84 0 1176345.78 0

10. Escorts Mutual Fund 13247.54 0 11715.44 0

11. Fidelity Mutual Fund 881348.73 4365.86 844375.84 4476.53

12. Franklin Templeton Mutual Fund 2627635.74 30636.2 2536497.59 31101.51

3614666.74 0 3388820.86 0
13. HDFC Mutual Fund

14. HSBC Mutual Fund 1458564.08 0 1350481 0

15. ICICI Prudential Mutual Fund 5070300.11 3907.38 4599486.19 3870.1

16. ING Vysya Mutual Fund 571786.36 81847.32 445335.57 83156.41

17. JM Financial Mutual Fund 377249.74 0 350488.13 0

18. JP Morgan Mutual Fund N/A N/A N/A N/A

19. Kotak Mahindra Mutual Fund 1672255.56 54018.22 1454533.63 52628.06

20. LIC Mutual Fund 990442.2 0 969282.55 0

21. Lotus India Mutual Fund 362314.83 0 280596.17 0

22. Morgan Stanley Mutual Fund 318066.94 0 310005.39 0

23. PRINCIPAL Mutual Fund 1314851.07 0 1089590.26 0

24. Quantum Mutual Fund 6105.59 0 6015.5 0

25. Reliance Mutual Fund 5914347.61 0 5763304.33 0

26. Sahara Mutual Fund 17646.54 0 17316.89 0

27. SBI Mutual Fund 1966082.91 0 1952036.51 0

28. Standard Chartered Mutual Fund 1617021.76 1534.45 1583682.27 1579.72

29. Sundaram BNP Paribas Mutual

1014528.63 0 899695.06 0
Fund

30. Tata Mutual Fund 1408188.86 0 1345348.07 0

31. Taurus Mutual Fund 30547.23 0 30198.75 0

32. UTI Mutual Fund 4007016.87 0 3677723.39 0

Grand Total 41417160.61 214764.33 38638285.61 214667.5

MARKET SHARE OF MUTUAL FUND COMPANIES AS ON 20, JUNE
2007

1. ABN AMRO Mutual Fund 1.621515733

2. AIG Global Investment Group Mutual Fund

3. Benchmark Mutual Fund 1.40600982

4. Birla Sun Life Mutual Fund 5.636121131

5. BOB Mutual Fund 0.026526073

6. Canbank Mutual Fund 0.691262347

7. DBS Chola Mutual Fund 0.548024522

8. Deutsche Mutual Fund 1.860427963

9. DSP Merrill Lynch Mutual Fund 3.044508216

10. Escorts Mutual Fund 0.030320807

11. Fidelity Mutual Fund 2.185334641

12. Franklin Templeton Mutual Fund 6.564726022

13. HDFC Mutual Fund 8.770629459

14. HSBC Mutual Fund 3.495188719

15. ICICI Prudential Mutual Fund 11.90396033

16. ING Vysya Mutual Fund 1.152575905

17. JM Financial Mutual Fund 0.907100624

18. JPMorgan Mutual Fund

19. Kotak Mahindra Mutual Fund 3.764488012

20. LIC Mutual Fund 2.508606515

21. Lotus India Mutual Fund 0.726212785

22. Morgan Stanley Mutual Fund 0.80232698

23. PRINCIPAL Mutual Fund 2.819975687

24. Quantum Mutual Fund 0.015568755

25. Reliance Mutual Fund 14.91604568

26. Sahara Mutual Fund 0.044817956

27. SBI Mutual Fund 5.052078474

28. Standard Chartered Mutual Fund 4.098738453

29. Sundaram BNP Paribas Mutual Fund 2.328506676

30. Tata Mutual Fund 3.48190415

31. Taurus Mutual Fund 0.078157583

32. UTI Mutual Fund 9.518339988

COMPANY PROFILE
CD Equisearch
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 Mission & Vision
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Our Guiding Principles

We, at CD Equisearch believe that being on par in terms of price and quality only
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 TRUST
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We believe that abiding by these values for over more than the past three decades has
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 Our Products

Equity & Derivatives

Investing in shares or stock market is inarguably the best route to long-term wealth accumulation.
However, it can also be a very risky proposition due to high risk-return trade-off prevalent in the
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Commodity
Commodities are more than what you think they are. Almost everything you see around is made
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Currency Derivatives have evolved into a reliable asset class due to its deep liquidity, relatively
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Mutual Funds
Investing in a Mutual Funds is the most sensible route to utilize the best fund- management
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IPO
An Initial Public offer (IPO) is the selling of securities to the public in the primary market. It is
when an unlisted company makes either a fresh issue of securities or an offer for sale from its
existing securities or both for the first time to the public. This paves the way for listing and
trading of the issuer’s securities. The sale of securities can be either through book building or
through normal public issue.
  BALANCE SHEET CONCISE
 CONSOLIDATED
 STANDALONE
Rs.in Crore

(Rs.in Crore)

Particulars

Dec 2004

Dec 2003

EQUITY AND LIABILITIES

Share Capital

23.03

23.03

Share Warrants & Outstandings

0.00

0.00

Total Reserves

430.97

323.34

Shareholder's Funds

454.00

346.37

Minority Interest

0.00

0.00

Long-Term Borrowings
0.00

0.00

Secured Loans

0.00

0.00

Unsecured Loans

20.09

15.58

Deferred Tax Assets / Liabilities

0.83

0.37

Other Long Term Liabilities

0.00

0.00

Long Term Trade Payables

0.00

0.00

Long Term Provisions

0.00

0.00

Total Non-Current Liabilities

20.92

15.96

Current Liabilities
Trade Payables

40.35

40.98

Other Current Liabilities

57.77

59.90

Short Term Borrowings

0.00

0.00

Short Term Provisions

32.55

32.48

Total Current Liabilities

130.68

133.36

Total Liabilities

605.61

495.69

ASSETS

Gross Block

298.60

280.92

Less: Accumulated Depreciation

131.59
115.95

Less: Impairment of Assets

0.00

0.00

Net Block

167.01

164.97

Lease Adjustment A/c

0.00

0.00

Capital Work in Progress

2.93

14.49

Non Current Investments

0.42

0.42

Long Term Investment

0.42

0.42

Long Term Loans & Advances

0.00

0.00

Other Non Current Assets

0.00

0.00

Total Non-Current Assets

170.35

179.88

Current Assets Loans & Advances

Currents Investments

0.00

0.00

Inventories

111.08

95.29

Sundry Debtors

92.90

46.83

Cash and Bank

179.89

134.83

Other Current Assets

0.00

0.00

Short Term Loans and Advances

51.39

38.86

Total Current Assets

435.26

315.81
Net Current Assets (Including Current Investments)

304.58

182.45

Miscellaneous Expenses not written off

0.00

0.00

Total Assets

605.61

495.69

Contingent Liabilities

125.33

121.45

Total Debt

20.09

15.58

Book Value

18.94

14.23

Adjusted Book Value

18.94

14.23