Chapter - 1

INTRODUCTION

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 Banking Industry

1.1 Introduction

This project is about the investment preference of the customers in fixed deposit and
mutual fund. These are the investment instrument which bears comparatively low risk
and gives higher and sometimes moderate return. There are a large number of Banks and
other financial institutions which provide these investment facilities. In investors point of
view this report will be beneficial in terms of providing information that between these
instruments which investment will cover less risk of sinking of invested fund and
generate more return. In this study the analysis of various institutions has done which will
help the investor to stand on right choice. In company point of view this report will help
in terms of providing the information that how much population is aware about these
instruments and how many are interested in investment through these instruments.
Accordingly company can plan their promotional activities, promote their existing
schemes and plan their future products. This will help company to formulate new market
policies and launching new products in market. This will provide competitive benefit to
the company in market. This report includes the sufficient information about company,
existing products of company, performance of company and its products, relative
comparison of Mutual Fund and Fixed Deposit, relative comparison of investment
products of this company and other companies in the market. This report also includes the
recommendations and suggestions in order to increase marketing efficiency of the
company.

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1.2 WHAT IS BANKING

A bank is a financial institution and a financial intermediary that accepts deposits and
channels those deposits into lending activities, either directly by loaning or indirectly
through capital markets. A bank is the connection between customers that have capital
deficits and customers with capital surpluses. Learn the simple and concise definition of
banking. The definition of banking varies from country to country and in this example we
are trying to define banking in most simple and generic terms.

The banking industry is a dynamic and significant component to individuals, corporates,

small and medium businesses, national and global, economic, socio and financial well-
being. This industry cultivates financial relationships with customers of all sizes to supply
financial products and services that stimulate economic growth, and act as a catalyst to
national and global economics. The industry players produce a variety of services from
savings accounts to home and business loans and mortgages, and from fund mobilization
to handling global mergers and acquisitions. This industry is sensitive to regulatory,
technological, and economic factors and has its own share of challenges largely
attributable to these factors. New developing economies are changing the global
landscape of economic wealth and economic instruments and banking industry is
adapting very fast to provide new generation of innovative banking products and
services. Banking industry is adopting unique strategies to overcome these challenges and
move forward to deliver financial objectives to people and organizations..

According to banking regulation act 1949-Banking is accepting of deposits for

the purpose of lending and investing from the people or public which are repayable on
demand or otherwise and withdrawal by cheque draft and otherwise.

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1.2.1 Banking Industry

A bank is a financial institution and a financial intermediary that accepts deposits and
channels those deposits into lending activities, either directly by loaning or indirectly
through capital markets. A bank is the connection between customers that have capital
deficits and customers with capital surpluses.

Due to their influence within a financial system and the economy, banks are highly
regulated in most countries. Most banks operate under a system known as fractional
reserve banking where they hold only a small reserve of the funds deposited and lend out
the rest for profit. They are generally subject tominimum capital requirements which are
based on an international set of capital standards, known as the Basel Accords.

Banking in its modern sense evolved in the 14th century in the rich cities of Renaissance
Italy but in many ways was a continuation of ideas and concepts ofcredit and lending that
had its roots in the ancient world. In the history of banking, a number of banking
dynasties have played a central role over many centuries.

1.2.2 HISTORY OF BANKING-

Banking in the modern sense of the word can be traced to medieval and
early Renaissance Italy, to the rich cities in the north
like Florence, Lucca, Siena, Veniceand Genoa. The Bardi and Peruzzi families dominated
banking in 14th century Florence, establishing branches in many other parts
of Europe. One of the most famous Italian banks was the Medici Bank, set up
by Giovanni di Bicci de' Medici in 1397. The earliest known state deposit bank, Banco di
San Giorgio (Bank of St. George), was founded in 1407 at Genoa, Italy.

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The oldest bank still in existence is Monte dei Paschi di Siena, headquartered
in Siena, Italy, which has been operating continuously since 1472. It is followed by
Berenberg Bank of Hamburg (1590) and Sveriges Riksbank of Sweden (1668).

The origins of banking can be traced to ancient times, starting with rudimentary money
lending and bartering practices for agricultural and other commodities. But it gained great
momentum only after industrial revolution which commenced in Europe in the 17 th
century, when Europeans started establishing colonies around the world and the need for
credit for trade was felt like never before.

Ever since bank started operating, their essential mode of operations remained much the
same until late into 20th century. But the arrival of Internet in 1990s changed all that. A
plethora of possibilities emerged for worldwide commerce, which naturally impact the
functioning of banks as well. Even now, technology evolution shape the nature and extent
of global economic activity and continuous to fundamentally alter the global banking
landscape.

1.2.3 BANKING IN INDIA-

In India, banking as an institution originated in the late 18 th century and primarily catered
to needs of the British. Post-independence, the nationalization of major private sector
banks in 1969 an important milestone in Indian banking system made banking
accessible to the unbanked population in India.

The economic liberalization in early 1990s ushered in the era of privatization wherein
new private banks the new generation tech-savvy banks were launched. A few
foreign banks commenced their India operation as well. All these banks were quick to
leverage emerging technology, were competitive in wooing them over by providing
professional services. This helped infuse a sense of urgency in public sector banks and

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older private sector banks to mend their ways, which in turns completely revitalized
banking operation in India.

Indias banking sector is growing at a fast pace. It has become one of the most preferred
banking destinations in the world. Indian markets provide growth opportunities, which
are unlikely to be matched by the mature banking markets around the world. FICCI
conducted a survey to analyze the potential offered by Indian Banking System and
achievement of global competitiveness by Indian banks.

Some of the major strengths of the Indian banking industry, which have helped mark its
place on the global banking scene as highlighted by our survey respondents were
Regulatory Systems (84.21%), Economic Growth Rate (63.15%), Technological
Advancement (52.63%), Risk Assessment Systems (47%) and Credit Quality (42.1%)

Some of the areas that need to be geared up for future growth, identified by the survey
respondents are Diversification of markets beyond big cities (84.2%), HR Systems
(63.15%), Size of banks (52.63%) High Transaction Costs (47.3%), Banking
Infrastructure (42%) and Labour Inflexibilities (42%).

To a question on achieving global competitiveness, Consolidation in the financial sector

has emerged to be the most significant measure required to create world class banking
system followed by Strict Corporate Governance Norms, Regional Expansion, Higher
FDI limits and FTAs.

To a question on achieving global competitiveness, Consolidation in the financial sector

has emerged to be the most significant measure required to create world class banking
system followed by Strict Corporate Governance Norms, Regional Expansion, Higher
FDI limits and FTAs.

1.3 NBFC-Non-Banking Financial Company

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Non-bank financial companies (NBFCs) are financial institutions that
provide banking services without meeting the legal definition of a bank, i.e. one that does
not hold a banking license. These institutions are not allowed to take deposits from the
public. Nonetheless, all operations of these institutions are still exercised under bank
regulation. However this depends on the jurisdiction, as in some jurisdictions, such as
New Zealand, any company can do the business of banking, and there are no banking
licenses issued. If an organisation in New Zealand intends to describe itself as a bank and
intends to use the word bank in its title it must first receive approval and official
registration and thus licence from the nation's central bank, the Reserve Bank of New
Zealand.

NBFCs offer most sorts of banking services, such as loans and credit facilities, private
education funding, retirement planning, trading in money markets, underwriting stocks
and shares, TFCs(Term Finance Certificate) and other obligations. These institutions also
provide wealth management such as managing portfolios of stocks and shares,
discounting services e.g. discounting of instruments and advice on merger and
acquisition activities. The number of non-banking financial companies has expanded
greatly in the last several years as venture capital companies, retail and industrial
companies have entered the lending business. Non-bank institutions also frequently
support investments in property and prepare feasibility, market or industry studies for
companies.

However they are typically not allowed to take deposits from the general public and have
to find other means of funding their operations such as issuing debt instruments.

1.3.1 Difference between banks & NBFCs

An often heard question from the laymen is what is the difference between a bank and a
non banking finance company? Say for example, what would be the difference between
ICICI Bank and Mahindra Finance. Yes, banks and other non banking financial
institutions differ in some functional area.

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NBFCs lend and make investments and hence their activities are akin to that of banks.

However there are a few differences as given below:

NBFC cannot accept demand deposits;

NBFCs do not form part of the payment and settlement system and cannot issue
cheques drawn on itself

NBFC cannot issue Demand Drafts like banks

Deposit insurance facility of Deposit Insurance and Credit Guarantee Corporation

is not available to depositors of NBFCs, unlike in case of banks.

While banks are incorporated under banking companies act, NBFC is

incorporated under company act of 1956

Other features of NBFCs are

The NBFCs are allowed to accept/renew public deposits for a minimum period of
12 months and maximum period of 60 months. They cannot accept deposits
repayable on demand.

The deposits with NBFCs are not insured. The repayment of deposits by NBFCs
is not guaranteed by RBI.

1.4 Mahindra & Mahindra Financial Services

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1.4.1 Company History -
We were incorporated on January 1, 1991 as Maxi Motors Financial Services Limited and
received certificate of commencement of business on February 19, 1991. The name was
changed to Mahindra & Mahindra Financial Services Limited on November 3, 1992. We
are registered with the RBI as an NBFC with effect from September 4, 1998 under
Section 45IA of the Reserve Bank of India Act 1934.

On October 2nd, 1945, Mahindra & Mohammed was set up as a franchise for assembling

jeeps from Willys, USA.

Two years later, Mahindra & Mohammed changed its name to Mahindra & Mahindra.
Ghulam Mohammed migrated to Pakistan post-partition and became the first Finance

Minister of Pakistan. Mahindra and Mahindra started trading steel on behalf on European

suppliers. In 1955, Mahindra and Mahindra was converted to a public limited company.

Soon after that the Mahindra tools division started. After the formation of Mahindra tools,

Mahindra Engineering and Chemical products was formed. In 1983, M&M led the Indian

tractor segment. Post that incident they formed a joined venture with British
Telecommunications to form Mahindra British Telecom.

Keshub Mahindra was made the Chairman of Mahindra in 2007 from the post of Vice-

Chairman and Managing Director. Mahindra has total revenues of US 12.5 billion dollars

and employs more than 1,19,900 people around the world. The company has coverage in

the vehicles market, the tractor market, information technology as well as significant

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present in financial services, leisure and hospitality.

1.4.2 Company Background

Mahindra and Mahindra Financial Services Limited is one of Indias leading non-
banking finance companies. Through a vast network of branches, they provide
personalised finance for the widest range of utility vehicles, tractors and cars, focusing on
the rural and semi-urban sector.

MMFSLs rural financing is considered as the cornerstone of poverty reduction, rural

development and inclusive growth in many parts of the country. With a majority of our
countrys population living in rural India, their loans to over 10,00,000 customers
belonging to the low income groups have proved to be a catalyst in helping rural India
surge ahead in a big way.

Financials :-

F-2011 F-2010 F-2009

Total Income 2,01,258 1,56,880 1,38,446

Profit after Tax 46,311 34,271 21,452

Earning per share 47.85 35.75 22.46

Basic (Rs.)

MAHINDRA FINANCE
TYPE PUBLIC COMPANY
TRADED AS NSE: M&MFIN

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 BSE: 532720
INDUSTRY FINANCE
FOUNDED 1991
HEADQUARTERS MUMBAI, MAHARASHTRA , I NDIA
AREA SERVED INDIA
KEY PEOPLE BHARAT N DOSHI, CHAIRMAN
U Y PHADKE , DIRECTOR
RAMESH IYER, MD
PRODUCTS FINANCIAL SERVICES
REVENUE 27,945.9 MILLION (US$480 MILLION ) (2012)
TOTAL ASSETS 18,5615.6 MILLION (2012)
TOTAL EQUITY 1026.9 MILLION (2012)
EMPLOYEES 9,700+ (2012)
PARENT MAHINDRA G ROUP
SUBSIDIARIES
MAHINDRA INSURANCE BROKERS LIMITED

MAHINDRA RURAL HOUSING FINANCE

WEBSITE MAHINDRAFINANCE. COM

Vision

TO BE A LEADING FINANCIAL SERVICES PROVIDER IN SEMI - URBAN AND RURAL

INDIA.

Mission

TO TRANSFORM RURAL LIVES AND DRIVE POSITIVE CHANGE IN THE

COMMUNITIES.

Board of Directors

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1 } Bharat N Doshi Chairman
2 } Uday Y Phadke Director
3 } Dhananjay Mungale Director
4 } Manohar G Bhide Director
5 } Piyush Mankad Director
6 } Ramesh Iyer Managing Director
7 } Rama Bijapurkar Director
8 } Arnavaz M Pardiwala Company Secretary
9 } Pawan Kumar Goenka Director

1.4.3 Corporate Profile

In 1945, Mahindra assembled the Willys Jeep in India and is now a US $7.1 billion
Indian multinational. The total workforce caps at 1,11,900 people in over 100 countries
and the company is a leader in utility vehicles, tractors and information technology, with
a significant and growing presence in financial services, tourism, infrastructure
development, trade and logistics. Mahindras headquarters are in Mumbai India.
Mahindra is among the top tractor brands in the world. It sells everything from two-
wheelers to CVs, UVs, SUVs and the sedan. Mahindra recently acquired a majority stake
in REVA Electric Car Co Ltd. (now called Mahindra REVA), strengthening its position in
the Electric Vehicles domain.
Tech Mahindra acquired the leading global business and information technology services
company, Satyam Computer Services. The company is now known as Mahindra Satyam.

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Mahindra is also one of the few Indian companies to receive an A+ GRI checked rating
for its first Sustainability Report for the year 2007-08 and has also received the A+ GRI
rating for the year 2008- 09.

Financial Service
The necessity of a financial base for the groups' operations led to the foray into financial
services through Mahindra Finance and its subsidiaries. Together, a cluster of these
companies forms the Trade and Financial Services Sector of the Mahindra Group.

Mahindra & Mahindra Financial Services Ltd (Mahindra Finance) is one of India's
leading non-banking finance companies focused on providing finance for utility vehicles,
tractors and cars in the rural and semi-urban sector. Mahindra Finance currently has the
largest network of over 436 branches all over India. It has entered into more than 600,000
customer contracts and has disbursements of around Rs. 21000 crore since inception.

Mahindra Rural Housing Finance Ltd (MRHFL) is a wholly owned subsidiary of

Mahindra & Mahindra Financial Services (MMFSL). It has been set up with an objective
of meeting the housing finance needs of the rural/semi urban customers across the
country.

Automotive
Mahindra is the market leader for utility vehicles in India and also exports to several
countries in Europe, Africa, the Americas, South Asia and the Middle East. The
automotive unit, backed by a cutting edge R&D lab staffed by more than 300 engineers,
has a diverse product portfolio ranging from mass transport solutions to sports utility
vehicles like the Scorpio and Bolero and multi-utility vehicles like the Xylo.

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Mahindra Defense Systems provides total solutions for the entire range of light combat /
armored vehicles and their derivatives for defence / security forces. It has incorporated
state-of-the-art technology into its products at a reasonable cost and has emerged as the
largest private sector company for the supply of bullet-proof vehicles.

Mahindra Renault Pvt. Ltd. (MRPL), Mahindra in collaboration with Renault

launched India's first wide body car, Logan. The widely acclaimed Logan redefines its
segment in terms of spaciousness as well as performance and technology with the latest
generation dci common rail engine.

Mahindra Navistar Automotives Ltd. (MNAL), a joint venture between Mahindra &
Mahindra Limited and International Truck and Engine Corporation of USA,
manufactures trucks and buses for Indian and export markets. It also provides component
sourcing and engineering services to International Truck and Engine Corporation.
Mahindra Navistar Engines Pvt. Ltd. (MNEPL), a second joint venture, focuses on
producing diesel engines for Medium and heavy Commercial vehicles in India.

1.4.4 Company Founder(s)

Mahindra & Mahindra was founded by two brothers - Jagdish Chandra Mahindra &
Kailash Chandra Mahindra. KC Mahindra went to the United States of America as
Chairman of the India Supply Mission. He met Barney Roos, inventor of the rugged
'general purpose vehicle' or Jeep and had a flash of inspiration: wouldn't a vehicle that
had proved its invincibility on the battlefields of World War II become ideal for India's
rugged terrain, he thought. The Mahindra brothers joined hands with Ghulam
Mohammed to become a franchise for assembling jeeps from Willy, USA. In the North
Indian city of Ludhiana in Punjab, Jagdish Chandra Mahindra was born. The eldest of
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nine children, he lost his father at an early age. He believed strongly in education and
made sure that his brothers and sisters studied hard. Jagdish Chandra studied at Veermata
Jijabai Technological Institute (VJTI) Mumbai, one of India's premier engineering and
technical institutes. JCs first stop job was with Tata Steel as the senior Sales Manager
from 1929 to 1940.

KC Mahindra was also born in Punjab. KC studied at the Government College, Lahore
and Cambridge, UK. When he graduated from Cambridge, Mr. Sachinanda Sinha, Vice
Chancellor of Patna University, introduced him to Mr. R.N. Mukherjee, Senior Partner of
Messrs. Martin & Company. He started editing the monthly magazine INDIA and the
Hindustan Review.

KC moved to Bombay with his brother JC in 1946 to found Mahindra & Mohammed.
Under his leadership as Chairman, Mahindra & Mahindra established itself as a major car
player in the Indian market. He also served as Director of RBI, Air India, and Hindustan
Steel and Chairman of Indian Aluminum Company.

JC died in 1951 while KC died in 1963.

Mahindra has seven auto manufacturing facilities

Igatpuri (Engine Plant)

Haridwar (3 wheeler / GiO plant)

Kandivli (utility vehicles)

Nasik (utility vehicles)

Chakan

Zaheerabad (LCVs & 3 wheelers)

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 Completely Knocked Down Unit Plants in Egypt and Brazil

1.4.5 Recognition

Anand Mahindra won the Qimpro Platinum Standard (Business) 2008 award for
excellence in business practices.

Mahindra Holidays & Resorts India Limited (MHRIL) won the CNBC AWAAZ Travel
Award for its LakeView Resort, Munnar. The award was received in the category of Best
Resort for Health and Rejuvenation. Ulrich Wolffram, Head of Operations of MHRIL
received the award.

Mahindra was felicitated with the 'Brand Communicator of the Year' at the 9th Asia
Pacific PR Award. The award was received by Roma Balwani, head of corporate
communications of Mahindra and Mahindra.

Mahindra & Mahindra was awarded the ICSI National Award for Excellence in Corporate
Governance for the year 2008 at a function held in Vigyan Bhawan, New Delhi. The
award is for companies which follow the highest standards of corporate governance and
best practices which are worthy of notice. The Institute of Company Secretaries of India
(ICSI), a premier professional body has been set up under an Act of Parliament to
develop and regulate the profession of Company Secretaries. The award was received by
Arun Nanda, Executive Direcotr of Mahindra and Mahindra Limited. There were many
jury members present at the award ceremony.

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1.4.6 International Operations

Mahindra and Mahindra has been connected globally since its founding in 1945. It has a
setup in North America, South America, Europe, Middle East, Africa, Asia and Australia.

In the US market Mahindra works with Caterpillar and John Deere and GE. The company
also helps American companies to source materials from India. The company also
consults various other consulting companies from the Silicon Valley.

The company also works with agribusiness and farm equipment, automotive,
components, consulting services, energy and IT. The company sells tractors in China, and
also sells fresh products to South East Asia. They also help Bangladesh and Nepal with
generator sets so that there is supply of power at the homes in these countries improving
the standard of living at home.

1.4.7 Awards and Achievements- Key Events in our business history

Calendar Year Event

1993 Commenced financing of M&M UVs

1995 First branch opened outside Mumbai, at Jaipur
1996 Commenced financing M&M dealers for purchase of Tractors.
1998 Launched pilot project for retail tractor Financing.
1999 Commenced tractor retail financing in rural and semi-urban areas.
2001 Total Assets crossed Rs. 10 billion
2002 Commenced financing of non-M&M vehicles Received Tier II debt
from International Finance Corporation. Our first securitization

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 transaction of Rs. 434.8 million
2004 Long term credit rating of AA+/Stable Branch opened in Port Blair
Listing of non convertible debentures on BSE on the wholesale debt
market segment Securitisation of tractor assets of Rs. 256.6 million.
2005 Tie-up with HPCL MIBL became our wholly owned subsidiary
Commenced distribution of
Third party mutual funds.

2006 -Following a successful IPO, subscribed nearly 27 times more,

Mahindra & Mahindra Financial Services Ltd (MMFSL) priced its shares
at Rs 200 each. The original price band for the issue of two crore
shares of Rs 10 each, for cash at a premium decided through the
book-built process, had been fixed at Rs 170-200 a share.

-Mahindra & Mahindra Financial Services Limited has informed that Mr.
Narayan Shankar has ceased to be the Company Secretary of the company
with effect from October 26,2006. Ms. Angarika Baviskar continue to
hold the post of Deputy Company Secretary and Compliance Officer of
the company.

-Tied up with Maruti Udyog Limited.

-Reached a new benchmark with 400 branches.

2007 -Commenced Home Loans Business through our subsidiary Mahindra

Rural Housing Finance Limited.

2008 -Received 12.5% equity participation from NHB for our Subsidiary
Mahindra Rural Housing Finance Ltd.
-Preferential allotement of shares to Standard Chartered Private
Equity Ltd. & TPG Axon Private Equity Ltd.

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2009 -Commenced Fixed Deposits Program.

2010 - More than 2 lakh new customer contracts in a financial year for the
first time.
- Branch network crosses 550 branches.

2011 - Maiden QIP Issue.

- Joint Venture with Rabobank subsidiary for tractor financing in USA.

2012 - Mahindra Finance wins the inaugural Porter Prize in the category of
Creating Distinctive Value.

- Mahindra Finance are first runners up at CNBC TV18 Best Bank &
Financial Institution awards.

- Ranked 9th in the prestigious Dun & Bradstreet's India's Top 500
Companies 2011(released on 1st June, 2012), based on the total income
in the FIs/ NBFCs/ Financial Services Sector.

2013 -Company has splits its Face value of Shares from Rs 10 to Rs 2.

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1.4.8 Products:

Mahindra Finance is a Non Banking Financial Organisation (NBFC). The main areas in
which it deals are Financing, Fixed Deposit and Pan India distributor of Mutual Funds.

In financing activities it includes-

MMFSL Group Structure

Mahindra &Mahindra Financial Services(MMFSIL)
1. Mahindra Insurance Brokers Ltd (100%)
2. Mahindra Rural Housing Finance Ltd (87.5%)
3. Mahindra Finance USA LLC (49%)
4. Mahindra & Business Consulting Services Pvt. Ltd (100%)
5. 12.5% with National Housing Bank.

Asset finance- As a part of its core business it provides loan for utility vehicles as
well as construction equipment. It offers loan for both, new as well as pre-owned
vehicles.
Personal loan- It offers loan to fund medical treatment, wedding, education,
working capital of farming needs, purchase of furniture and consumer durables
and so on.

Insurance broking- Mahindra Insurance Brokers Limited, a wholly owned

subsidiary of Mahindra Finance, mainly deals with offering direct life and non-
life insurance broking for corporations and retail customers.

Housing finance- We are catering to the high demand for home loans from semi-
urban and rural areas through our wholly owned subsidiary- Mahindra Rural
Housing Finance Limited, which was incorporated during the year. With this we
intend to capitalize on our distribution reach for creating a niche in this sector.

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Mutual fund distribution- Mutual fund is a trust that pools the saving of a
number of investors who share a common financial goal. The money thus
collected is then invested in invested in capital market instruments such as shares,
debentures and other securities. The income earned through these investments and
the income appreciation realised by its unit holders in proportion to the number of
units owned by them.
The Mahindra Finance Mutual Fund distribution offers investment advisory
services through its brand Finsmart, with a team of AMFI certified
professionals. It is vigorously pushing forth to make mark on mutual fund arena.
Since its inception in 2006 the division has grown in reach from 5 states to 10 and
caters to over 20000 customers.

Mahindra Finance encompasses needs of clients. So while it believes in

making assets easily available, it also believes in catering to those who want to
create wealth from these assets. Its Investment Advisory Services acts as an
avenue to help create and multiply wealth. Recently it has received the necessary
permission from Reserve Bank of India (RBI) to start the distribution of Mutual
Fund products through its network. Earlier it was only participating in the liability
requirements of our customers but with a mutual fund distribution business, it is
participating in their asset allocation.

When it comes to investing, everyone has unique needs based on their

own objectives and risk profile. While many investment avenues such as fixed
deposits, bonds etc. exist, it is usually seen that equities typically outperform
these investments, over a longer period of time. Hence company makes
suggestion that, systematic investment in equity allows one to create substantial
wealth.

However, investing in equity is not as simple as investing in bonds or

bank deposits, because only proper allocation of portfolio gives maximum returns
with moderate risk, and this requires expertise and time. Its Investment Advisory

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 Services help investors to invest their money in equity through different Mutual
Fund Schemes. It ensures the best for its clients by identifying products best
suited to individual needs.

Fixed Deposit- Fixed Deposit is a scheme in which a definite amount is invested

for a certain period. The institution in which the money has been invested
provides fixed interest to the investor. Different institutions offer different interest
rates.

1.4.9 Mahindra Finance offers-

(1) Personalised Service- We believe in providing personalised service and

individual attention to each client to ensure that we understand their investment
goals and help them achieve it.

(2) Professional Advice- We offer expert advice on equity and debt portfolios with
an objective to provide consistent long-term return while taking calculated market
risks. Our approach helps our clients build a proper mix of products, and not
concentrate on just one individual product. Hence, serving their long-term
objectives in the best way.

(3) Long-term Relationship- We believe that long-term vision is the only means to
steady wealth creation. However to achieve this one also needs to take advantage
of short-term market opportunities while not loosing sight of long-term
objectives. Hence we partner all our clients in realising their long-term vision.

(4) Personalised Service- We believe in providing personalised service and

individual attention to each client to ensure that we understand their investment
goals and help them achieve it.

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(5) Professional Advice- We offer expert advice on equity and debt portfolios with
an objective to provide consistent long-term return while taking calculated market
risks. Our approach helps our clients build a proper mix of products, and not
concentrate on just one individual product. Hence, serving their long-term
objectives in the best way.

(6) Long-term Relationship- We believe that long-term vision is the only means to
steady wealth creation. However to achieve this one also needs to take advantage
of short-term market opportunities while not loosing sight of long-term
objectives. Hence we partner all our clients in realising their long-term vision.

(7) Access to Research Reports- We provide our clients with access to the expert
opinion of economists and analysts from CRISIL, one of the leading financial
research and rating companies of India. This is because, we believe that unbiased
research is the key to providing sound advice in making informed investment
decisions.

(8) Transparency and Confidentiality- Our clients receive regular portfolio

statements from us via email. They can also view the detailed performance of
their investment portfolio on the web, the access to which is restricted to the client
only. Moreover, our monitoring system enables us to detect any unauthorised
access to the portfolio.

(9) Flexibility- To facilitate smooth dealing and consistent attention, all our clients
are by their individual Relationship Executives. Relationship Executives provide
you with completely hassle-free, customised services taking care of all the
administrative aspects of your investments. This includes submission of
application forms to fund houses and a monthly report on the overall performance
of your investment portfolio.

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 1.4.10 Companys clients also enjoy:

(1) Information updates on a daily basis through email

(2) Ease of viewing their portfolio on the internet

(3) Investment advice at their convenience

(4) Weekly, fortnightly and monthly reports sent to them via email, on request

(5) The freedom to contact us, anywhere in India

(6) Access to the multiple products offered by Mahindra Finance through their
Relationship Executive.

1.4.11 Credit Rating FAAA by Crisil (indicates highest safety). The Credit Rating
Information Services of India Limited (CRISIL). The rating provides an independent
assessment of an entity's current performance and an expectation on its "balanced value
creation and corporate governance practices" in future. The bank was assigned a 'CRISIL
GVC Level 1' rating in January 2007 which indicates that the bank's capability with
respect to wealth creation for all its stakeholders while adopting sound corporate
governance practices is the highest.

CREDIT RATING

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1.4.12 Competitors of Mahindra & Mahindra Financial Services
Limited-

6 Month Above 5
Name Of Bank -1 Year 1-2 Years 2-3 Years 3-5 Years years
8.50-
Axis Bank 7.50% 8.75% 8.75% 8.75% 8.50%
Bank Of 7.30 - 8.75-
Baroda 7.75% 8.75% 8.75% 8.90% 8.75%
8.75-
Bank of India 8.00% 9.00% 9.00% 9.00% 9.00%
Bank of 7.50- 9.00- 9.00-
Maharastra 8.50% 9.10% 9.00% 9.10% 9.00%
7.25- 9.00- 8.75-
Canara Bank 8.50% 9.10% 9.00% 9.00% 9.00%
Central Bank 9.00-
Of India 7.75% 9.15% 8.75% 8.50% 8.50%
Corporation 8.75-
Bank 9.00% 9.00% 9.00% 9.00% 8.75%
8.75- 8.75-
Dena Bank 8.50% 9.00% 9.25% 9.00% 9.00%
Development 8.75-
Credit Bank 6.75% 9.00% 9.30% 8.75% 8.75%
Dhanlaxmi 8.50- 8.50- 9.00% 9.00% 9.00%

25
Bank 8.75% 9.25%
7.50- 8.00-
HDFC Bank 8.00% 8.75% 8.75% 8.75% 8.25%
7.00- 7.50-
ICICI Bank 7.25% 9.00% 8.75% 8..75% 8.50%
8.65- 8.75- 8.50-
IDBI Bank 8.75% 9.00% 9.00% 9.00% 8.75%
Indian
Overseas Bank 8.50% 9.00% 9.00% 9.00% 9.00%
ING Vysya 8.70% 9.25% 9.25% 9.00% 8.50%

Kotak
Mahindra 8.50- 8.75-
Bank 9.00% 9.00% 9.00% 8.75% 8.50%
Oriental Bank
of Commerce 8.50% 9.00% 9.00% 9.00% 9.00%
State Bank Of
India 6.50% 8.75% 8.75% 8.75% 8.75%
7.75- 8.50-
Syndicate Bank 9.00% 9.00% 8.00% 8.00% 8.00%
The Federal 7.00-
bank 8.50% 9.00% 9.00% 8.75% 8.75%
Union Bank of 8.75-
India 8.50% 9.00% 9.00% 9.00% 9.25%
Vijaya Bank 8.50% 9.00% 9.00% 9.00% 9.00%
Shriram 9.25% 9.75% 10.75% 10.75% 10.75%
Mahindra &
Mahindra
Financial 9.25-
Services Ltd. 9.00% 9.75% 10.00% 10.25% 9.75%

26
1.4.13 S.W.O.T. ANALYSIS OF MAHINDRA FINANCE

STRENGTHS
Mahindra Finance has advantage of brand name of Mahindra &Mahindra Group.
Mahindra Finance has large asset base of Rs.5000 crores.
It has large distribution channels with 350 branches all over the nation.
Company has large financial base as its IPO was subscribed 26.88 times.

Mahindra Finance is leading company in NBFCs.

Mahindra Finance has advantage of brand name of Mahindra & Mahindra Group.
The credit rating of this company is very high.
It has CRISIL FAAA credit rating.
There are lot of branches in India.
The main advantage is that Mahindra Finance has many type of product which
help the financial sector.
Customers typically rebel against price increases by switching to competing
products, but if a company has pricing power, customers will continue
using Mahindra finances products and services.
Superior technology allows Mahindra finance to better meet the needs of their
customers in ways that competitors cant imitate.
A strong supply chain helps Mahindra finance obtain the right resources from
suppliers and delivery the right product to customers in a timely manner.
Financial leverage allows Mahindra finance to use their balance sheet to expand
their business and increase their profits.
Lower costs lead to higher profits for Mahindra finance. A low cost leader can
undercut rivals on price.
Mahindra finance only needs to target new customers in order to grow their
business.

WEAKNESSES
Mahindra Finance provides advisory service and they do not have share broking facility
which their competitors have.

27
Mahindra Finance is not known to the people.
Mahindra Finance does not make advertisement of its product.

A tarnished reputation can hurt Mahindra finances brand in the eyes of a

consumer.
A tarnished reputation can hurt Mahindra finances brand in the eyes of a
consumer.
A lack of scale means Mahindra finances cost per unit of output is very high
Increasing volume, while maintain quality, would help reduce those costs.
Weak customer service hurts Mahindra finances reputation and causes customers
to flee to competitors, who are more respondent.
Bad acquisition can hurt Mahindra finance by increasing their costs and reducing
the value of their combined businesses.
A weak brand means Mahindra finance cant charge the same prices for goods and
services as their competitors, because consumers dont value the brand.

OPPORTUNITIES
Mahindra Finance has entered into mutual fund distribution which is growing as per
Indian market development. Automobile sector in India is growing as foreign companies
entering in India which is useful for Mahindra Finance as it provides vehicle loans.
Mahindra Finance helps individuals in making financial planning which is most
profitable in as investment trend is changing in India.

Fragmented markets provide many opportunities for Mahindra finance to expand

and increase market.
Leveraging the balance sheet allows Mahindra finance to quickly expand into
other markets.
The online market offers Mahindra finance the ability to greatly expand their
business. Mahindra.
Greater innovation can help Mahindra finance to produce unique products and
services that meet.
New services help Mahindra finance to better meet their customers needs.
New technology helps Mahindra finance to better meet their customers needs
with new and improved.

28
 New products can help Mahindra finance to expand their business and diversity
their customer base.

THREATS
The biggest threat for Mahindra Finance in the market is new entry of foreign non-
banking financial institutions.
In case of vehicle financing company has tough competition from large banks like State
Bank of India, ICICI etc.

A bad economy can hurt Mahindra finances business by decreasing the number
of potential.
The availability of substitute products hurts Mahindra finances ability to raise
prices.
Consumers can change their tastes very quickly.
Politics can increase Mahindra finances risk factors, because governments can
quickly change.
Changes to government rules and regulations can negatively affect Mahindra
finance.
Intense completion can lower Mahindra finances profits, because competitors can
entice consumers.

1.5 My work during the Internship:

I have worked on these two parameters:

1. Fixed deposit
2. Broker empanelment

Fixed deposit:-

29
I have worked on fixed deposit and broker empanelment got the data of 238 people and I
called them told about the scheme of fixed deposit both cumulative and non cumulative
scheme. The initial starting rate of interest of Mahindra and Mahindra financial service
ltd is 9.25% in cumulative scheme for one year and in non cumulative scheme is 9% in
half yearly and in quarterly it is 8.90% with this I went to people by taking a appointment
from them.Now a days it is very difficult to convince a customer for FD because .People
are more interested in govt bonds and securirties. The main reason behind it is the
security concern . So people are not willing to pay the money or we can say store their
money in the reputed organizing which is ensuring the highest security through FAAA
CRISIL rating. This is because of our traditional culture because people still believe in
depositing their money into banks where the rate of interest is less or if they willing to
store their money they will give it to the Govt. banks rather than these kinds of private
organizing. On the other way if they are ready to invest in FD, the interest factor
comesinto existence where Mahindra Finance is lacking behind because SHRIRAM is
giving more than Mahindra. So I took a knowledge of that also and got to know the rate
of interest. And what are the loop holes of other companys scheme. Yes shriram is
giving more rate of interest but they deal in NCD the customer can not redeem their
amount before the maturity period In NCD . So I take the advantage of this Information
to convince people that this will not happen in Mahindra and Mahindra you can redeem
your amount at any time.and this is my second week experience in the field.

Documents required in broker empanelments are:-

1. Application Form
2. Resident Proof
3. Photo Identity Proof
4. Pan Card
5. Passport Size Photo
6. Cancelled Cheque

Process Of Fixed Deposit:-

30
 1. I was Given the data of some good customers of Mahindra Finance.
2. I made a call to customers
3. Took the appointment for meeting of interested customers
4. Made them understand about the product
5. Made them convince to buy this product
6. Finally sold the products to some of customers and took their documents and sent
them to Patiala Branch for further process because this FD process is not localized
based process.

Process Of Empanelment :-

1. I was given the data of 238 AMFI certified people of Jalandhar.

2. Firslty make a call to them.
3. Take the appointment of meeting.
4. Make them clear on each and every aspect of fixed deposit.
5. Took the required documents of those who are ready to sell this product.
6. Finally I did the empanelments and sent the documents to Patiala Branch.

Broker Empanelment:-

Anyone can become the broker of the Mahindra Finance. But the person who is
registered under AMFI will get the extra benefits. So the reason behind broker
empanelment is because these brokers have better customer relations than the company
itself so they can easily convince the customer for the FD. On the other hand company
will take time to make such kind of networking which the broker already has sowith the
help of brokers company target the customers and in retun broker gets the commission on
each and every FD. So I got to understand about the brokerage system of Mahindra amd
Mahindra financial service ltd. With this knowledge I convinced some AMFI AND NON
AMFI certified broker to do a work with Mahindra and Mahindra and provide good
services by providing all the documents time to time, solve their queries and also meet
their customers. So this helps me a lot to create a healthy relation with that people.

31
Commission of the Brokers

Time Period Rate of Interest

12 month 0.25% of the deposit amount

18 month 0.50% of the deposit amount

24 month 0.75% of the deposit amount

36, 48, 60 month 1.00% of the deposit amount

1.25% of the deposit amount (If you are AMFI certified)

Documents required in broker empanelments are:-

1.Pan Card (Compulsory)

2. Address Proof

3.Cancelled Cheque

4. ARN Number (IF AMFI CERTIFIED)

At present Mahindra Finance has started to accept fixed deposit from public from
1st January 2009. The brief details of the FD scheme are as below-

Non-cumulative half yearly scheme-

Minimum Period Interest *#

Amount (Months) p.a.

32
 12 9.00%

Rs. 25,000 24 9.75%

36 10.00%

Cumulative scheme-

Minimum Period Amount Interest* Effective

Amount (Months) Payable p.a. Yield p. a.**

12 Rs. 10,925 9.25% 9.25%

18 Rs. 11,510 9.75% 10.07%

Rs. 10,000
24 Rs. 12,202 10.00% 10.50%

36 Rs. 13,401 10.25% 11.34%

Chapter 2
33
 RESEARCH METHODOLOGY

2.1 Research Methodology

Research is a common parlance which refers to search for knowledge. It is a procedure

of logical and systematic application of the fundamentals of science to the general and
overall questions of a study and scientific technique, which provide precise tools, specific
procedures, and technical rather philosophical meaning for getting and ordering the data
prior to their logical analysis and manipulating different type of research designs is
available depending upon the nature of research project, availability of manpower and
circumstances.

Research methodology is a way to systematically solve research problem In it. we study

the various steps that are generally adopted by researcher in studying his research
problem along with the logic behind them. It is necessary for a researcher to know not
only the research methods/techniques but also the methodology. It may be noted, in the
context of planning & development, that the significance of research lies in its quality
and not in quantity. Researchers should know how to apply particular research

34
techniques, but they also need to know which of these methods or techniques, are
relevant and which are not, and what would they mean and indicate and why.

2.2 RESEARCH DESIGN-

A Research Design is the arrangement of conditions for collection and analysis of data in
a manner that aims to combine relevance to the research purpose with economy in
procedure. Infact, the research design is the conceptual structure within which the
research is conducted. This research was descriptive in nature.

I proposed to first conduct a intensive secondary research to understand a the full impact
and implication of the industry, to review and critique a industry, norms and reports, on
which certain issue shall be selected, which I feel remain unanswered or liable to change,
this shall be further taken up in the next stage of exploratory research. This stage shall
help me to restrict and select only the important questions and issue. Which inhabit
growth and segmentation in the industry.

There are various stages to solve the research problem as shown in following
program:

35
2.3 DESCRIPTIVE RESEARCH-

The research undertaken was a descriptive research as it was concerned with specific
predictions, with narration of facts and characteristics concerning Fixed Deposits Product
provided by Mahindra & Mahindra Financial Services Ltd.

2.4 SAMPLING DESIGN-

The following factors have been decided within the scope of sample design:

36
2.4.1 Sample Size- A Sample of minimum respondents was selected from the Jalandhar
Region. An effort was made to select respondents evenly. The survey was carried out on
50 respondents.

2.4.2 Sample Unit- In this project sampling unit consisted of the various individuals,
businessman and services.

2.4.3 Sampling Technique- For the purpose of research Convenient Sampling Technique
was used.

2.4.4 Sampling Frame- It consisted of various sources from where information about the
respondent is extracted. Mainly personal links, customers of Mahindra Finance and
common people are used for getting information about the respondents.

2.5 DATA COLLECTION AND ANALYSIS- There were 2 types of data sources used
in this research. These were:-

2.5.1 SECONDARY DATA-It is the data collected for already being used or published
information like Journals, Magazines, Research Papers, Internet, Books etc. In this
research project secondary source used were various journals, research papers, Books etc.

In this project report, the secondary data was given to me by mentor. It contains a list of
238 AMFI certified peoples in Jalandhar.

2.5.2 PRIMARY DATA-It is the data collected for the first time from the source and
never have been used earlier. The data can be collected through interviews, observations
and questionnaires. In this project, an appropriate questionnaire was designed which was
filled by the customers of Mahindra Finance, the investors and others people who want to
invest their money. In this project report, the primary data has been collected through the
questionnaires which helped in the analysis and the interpretation part.

2.6 Contact Method:

37
Personal approach to each and every customers for all surveys and interviews was the
contact method used for obtaining a proper and detailed feedback. A face-to-face
interaction took place with each sample representative.

The data collected through questionnaire was properly classified and tabulated in the
form of a report. These reports formed the basis for the comparative analysis and drawing
inferences there from. From the inferences drawn certain conclusions and
recommendations were made.

2.7 Field Work:

The fieldwork was conducted for a period of 15 to 20 days.

2.8 Mahindra and Mahindra finance brand awareness:

People are aware of Mahindra Finance but somewhere it is lacking due to its less rate of
interest than SHRIRAM and fast FD processing like HDFC, Mahindra and Mahindra
finance have very good reputation in the minds of the customers and mostly the people
know Mahindra and Mahindra is a good reputed company.So people are very well aware
of this brand rather than its product.

2.9 Distribution channel of Mahindra and Mahindra finance ltd:

The Mahindra and Mahindra finance have a very large network of distribution channel.
They have some tie up with some large broking companies. Who work as principal
brokers/ agents to the fixed deposit scheme. The name of that companies are as follows.

1. Jm financial services private ltd.

2. RR investors capital services pvt ltd.
3. ICICI securities ltd.
4. Karvy stock broking ltd.
5. Bajaj capital.
6. Integrated enterprises (india) ltd.
7. ING financial service pvt ltd.
8. HDFC securities
9. Kotak securities
10. Stock holding corporation of india ltd.

38
 11. Brokers and sub-brokers

2.10 Investment pattern of Mahindra and Mahindra financial service ltd:

Mahindra and Mahindra finance investment pattern in which they deal are as follows.

1. Fixed deposit
2. Mutual fund distribution
3. Personal loan
4. vehicle loan (utility vehicles, commercial vehicles, tractors, cars, two-wheelers
and used vehicles)
5. Auto loan
6. Refinancing
7. Housing finance
8. SME financing
9. Insurance broking
10. Loan against gold
11. Construction equipment loan

But I have mainly work on first two investment pattern and broker empanelment of
Mahindra and Mahindra financial service ltd during my intership programme.

2.11 DATA ANALYSIS-

2.11.1 TOOLS OF PRESENTATION-It means what all tools are used to present the
data in a meaningful way so that it becomes easily understandable

2.11.2 TOOLS OF ANALYSIS- In this research the tools of analysis used was SPSS
software.

39
2.12 LIMITATIONS OF THE STUDY- This study will facilitate in understanding the
consumer preferences towards the MAHINDRA AND MAHINDRA FINANCE fixed
deposit, and broker emapanelment. There are certain limitations of this studies are :

This study will be limited to only some areas of Jalandhar city.

It is only for short period of time.
Survey to a only limited numbers of people.
The sample size is only 50 so the sample may not be truly representative
of Jalandhar population.
Some respondents did not provide the all and accurate data.
There may be some biased response from the respondets.

1. SHORTAGE OF TIME- The time period of study was very limited. A period of
4-6 weeks is not enough for the proper study of the project.

2. BIASNESS IN THE RESPONSES-The answers provided by the respondents

suffer from biasness.

3. COST FACTOR- It was not possible to conduct extensive research due to paucity
of funds.

4. INADEQUATE DATA-The data provided was not up to the mark due to which we
faced problems in our research.

40
 Chapter 3
DATA INTERPRETATION AND
ANALYSIS

\3.1 Analysis and Interpretation-

This survey is designed to understand Internet users perspectives on Internet banking,

their experiences with and their expectations from Internet banking services.

Table 1- Gender of Respondents:

41
 Gender
Frequency Percent Valid Percent Cumulative Percent
Male 37 74.0 74.0 74.0
Valid Female 13 26.0 26.0 100.0
Total 50 100.0 100.0

80

70

60

50

40 frequency
percentage
30

20

10

0
male female

Table 1 represents the Gender of the respondents. 74% of the respondents are male. 26%
from the respondents are female. Gender deference also affects the perception of service.

Table 2- Occupation of Respondents

Occupation
Frequency Percent Valid Percent Cumulative Percent

Valid Business 25 50.0 50.0 50.0

Private Service 22 44.0 44.0 94.0

42
 Govt. Employee 3 6.0 6.0 100.0
Total 50 100.0 100.0

60

50

40

30 Frequency
Percentage

20

10

0
Business Private Service Govt.Empolees

The occupation of the respondents affects their perception. The table 1 reveals that out of
50 customers 50% people from business background. They are doing different types of
business. 44% respondents belong to employee category. Remaining 6% respondents are
from Govt. empolees.

Table 3- Age Group of respondent-

Age Group
Frequency Percent Valid Percent Cumulative Percent
Valid 20-30 yrs 18 36.0 36.0 36.0

43
 30-40 yrs 15 30.0 30.0 66.0
40-50 yrs 15 30.0 30.0 96.0
Above & 50 2 4.0 4.0 100.0
Total 50 100.0 100.0

40

35

30

25

20 Frequency
Percent
15

10

0
20-30 yrs 30-40 yrs 40-50 yrs 50 & Above

The result in table 3 reveals that out of 50 customers. 36% of the respondents belong to
the age group of less than 30 years. 30% of the respondents belong to the age group of
below 40 years. 30% of respondents lie between the age group of 4050 years. And 4%
categories of above belong to the age group of above 50 years.

Table 4- Annual Income of Respondent-

Annual Income
Frequency Percent Valid Percent Cumulative Percent

44
 1-1.5 Lacs 8 16.0 16.0 16.0
1.5-3 lacs 18 36.0 36.0 52.0
3 Lacs & Above 24 48.0 48.0 100.0
Valid
Total 50 100.0 100.0

60

50

40

30 Frequency
Percent

20

10

0
1-1.5 Lacs 1.5-3 lacs 3 Lacs & Above

Interpretation:- Out of 50 people approximately 48 % people are earning more than 3

Lacs. Which shows people are saving more from their income to invest in other sources
whether it is fixed deposit of saving accounts or PPF ets.

3.2 RESEARCH OBJECTIVES:

45
 To examine the association between income & investment.
To study the awareness component in regard to FDs.
To reveal the underlying satisfaction of the customers.

1. To Examine the association between annual income &

investment.

Table 5.
Statistics
Annual income Saving
N Valid 50 50
Missing 0 0
Mean 2.32 2.36
Median 2.00 3.00
Mode 3 3
Std. Deviation .741 .776
Variance .549 .602
Skewness -.599 -.737
Std. Error of Skewness .337 .337
Kurtosis -.923 -.933
Std. Error of Kurtosis .662 .662
Range 2 2
Minimum 1 1
Maximum 3 3
Percentiles 25 2.00 2.00
50 2.00 3.00
75 3.00 3.00

Interpretation : The Mode of annual income and savings are 3 so the diagram shows
that the maximum no of people who lies in 3 lacs & above annual income and saving 20
& above.
The Std. Deviation of the annual income and saving are 0.741 & 0.746 so that show that
the variation of both are very high.

46
Interpretation:- Out of 50 people approximately 48 % people are earning more than 3
Lacs. Which shows people are saving more from their income to invest in other sources
whether it is fixed deposit of saving accounts or PPF ets.

Interpretation:- According to my study people are saving approximately 20 and above%

of their income because they have to save the money for the future use and comports so
and rest they spend on their own life or comforts etc . and the part of the income they
save, invest in other things such as FD, Deposit in Bank or Post office etc.

Table 6. Correlations
Annual income Saving
Annual Pearson Correlation 1 .790**
income Sig. (2-tailed) .000
N 50 50
Saving Pearson Correlation .790** 1
Sig. (2-tailed) .000
N 50 50
**. Correlation is significant at the 0.01 level (2-tailed).

Correlation is 0.790. It is High posiive correlation.

In this table shows that the no of people income is high and those person saving is
more. And the saving is based on annual income.

2. To study the awareness component in regard to FDs.

47
 Table 7.
Statistics

Awareness Media Product used FD awareness

N Valid 50 50 50 50
Missing 0 0 0 0
Mean 1.38 3.50 2.62 3.68
Median 1.00 3.50 3.00 4.00
Mode 1 3 3 5
Std. Deviation .490 1.015 .945 1.696
Variance .240 1.031 .893 2.875
Skewness .510 -.183 -.663 -.362
Std. Error of Skewness .337 .337 .337 .337
Kurtosis -1.814 -.541 -.535 -1.383
Std. Error of Kurtosis .662 .662 .662 .662
Range 1 4 3 5
Minimum 1 1 1 1
Maximum 2 5 4 6
Percentiles 25 1.00 3.00 2.00 2.00
50 1.00 3.50 3.00 4.00
75 2.00 4.00 3.00 5.00

Inerpretation- In table no 6 shows us the mode of awareness, media, product used and FD
awareness are 1, 3, 3 and 5 that means most of people are aware of Mahindra Finance
(i.e 62% people are aware), 34%through the friends and 32% through the online websites
58% people are used the insurance product because it is very beneficial product and it has
high securities and last 36% and 22% people are aware of the Shriram and LIC Home
Finance.

Table 8. Awareness

48
 Frequency Percent Valid Percent Cumulative Percent
Yes 31 62.0 62.0 62.0
No 19 38.0 38.0 100.0
Total 50 100.0 100.0

70

60

50

40
Frequency
30 Percent

20

10

0
Yes No

Interpretation:- Out of 50 people approximately 62 % people are aware of Mahindra

finance which shows the majority of people are aware of this brand so it needs to
maintain and stable its standard .

Table 9. Media

49
 Cumulative
Frequency Percent Valid Percent Percent
Valid Newspaper 1 2.0 2.0 2.0
Advertisements 7 14.0 14.0 16.0
Friends 17 34.0 34.0 50.0
Online Websites 16 32.0 32.0 82.0
Others 9 18.0 18.0 100.0
Total 50 100.0 100.0

40
35
30
25
20
15 Frequency
Percent
10
5
0

Interpretation:-In this era most of people use social networking sites because of easy
fast and cheapest source so majority of the people came to know about this
organization from internet and the circle of friends are so important to know about the
latest product of company in the market.

Table 10. Product Used

50
 Cumulative
Frequency Percent Valid Percent Percent
Valid Fixed Deposits 10 20.0 20.0 20.0
Mutual Funds 5 10.0 10.0 30.0
Insurance 29 58.0 58.0 88.0
Loans 6 12.0 12.0 100.0
Total 50 100.0 100.0

70
60
50
40
30
Frequency
20
Percent
10
0

Interpretation In my survey the no of people use the insurance because it is very safe
and people invest your money in safe side so the company should adopt the methods or
techniques of the insurance company.

Table 11. FD Awareness

51
 Cumulative
Frequency Percent Valid Percent Percent
Valid Mahindra Finance 7 14.0 14.0 14.0
Sri Ram Finance 11 22.0 22.0 36.0
Muthoot Finance 1 2.0 2.0 38.0
HDFC LTD 8 16.0 16.0 54.0
LIC home Finance 18 36.0 36.0 90.0
Others 5 10.0 10.0 100.0
Total 50 100.0 100.0

40
35
30
25
20
15
10 Frequency

5 Percent

Interpretation: The no of people aware about the Shriram and LIC Home finance and
they like to invest their money in both company so the Mahindra company should adopt
their policies and awareness through the media, advertisement for the people so they
could aware about this product.

52
 3. To reveal the underlying satisfaction of the customers.
Table 12.

Statistics
Customer service Products Add on services Interest provided
N Valid 50 50 50 50
Missing 0 0 0 0
Mean 3.22 3.78 3.46 3.66
Median 3.00 4.00 3.00 4.00
Mode 3 4 3 3a
Std. Deviation .648 .708 .734 .895
Variance .420 .502 .539 .800
Skewness .694 -.374 -.018 -.327
Std. Error of Skewness .337 .337 .337 .337
Kurtosis 1.134 .314 -.192 .340
Std. Error of Kurtosis .662 .662 .662 .662
Range 3 3 3 4
Minimum 2 2 2 1
Maximum 5 5 5 5
Percentiles 25 3.00 3.00 3.00 3.00
50 3.00 4.00 3.00 4.00
75 4.00 4.00 4.00 4.00
a. Multiple modes exist. The smallest value is shown

Interpretation: All of these lie in 3 to 4 (i.e Average & Good) so most of people like the
product and their services.. But the company have to take some decision for their services
so the company could reach or achieve the good rating (i.e Good & Excellent)

53
 Table 13. Customer Services

Frequency Percent Valid Percent Cumulative Percent

Valid Poor 4 8.0 8.0 8.0
Average 33 66.0 66.0 74.0
Good 11 22.0 22.0 96.0
Excellent 2 4.0 4.0 100.0
Total 50 100.0 100.0

70

60

50

40
Frequency
30 Percent

20

10

0
Poor Average Good Excellent

Interpretation: Most of people are satisfied to the customer services (i.e 66% average,
22% good and 4% excellant)

54
Table 14. Products

Frequency Percent Valid Percent Cumulative Percent

Valid Poor 2 4.0 4.0 4.0
Average 13 26.0 26.0 30.0
Good 29 58.0 58.0 88.0
Excellent 6 12.0 12.0 100.0
Total 50 100.0 100.0

70

60

50

40
Frequency
30 Percent

20

10

0
Poor Average Good Excellent

Interpretation: 30% people are not satisfied from the products of Mahindra Finance but
most of people are satisfied (i.e. 70%)

55
Table no 15. Add on services

Valid
Frequency Percent Percent Cumulative Percent
Valid Poor 4 8.0 8.0 8.0
Average 22 44.0 44.0 52.0
Good 21 42.0 42.0 94.0
Excellent 3 6.0 6.0 100.0
Total 50 100.0 100.0

50
45
40
35
30
25 Frequency
20 Percent

15
10
5
0
Poor Average Good Excellent

Interpretation: 52% people are not satisfied from the add on services rest of satisfied

Table 16. Interest Provided

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 Frequency Percent Valid Percent Cumulative Percent
Valid Very Poor 1 2.0 2.0 2.0
Poor 2 4.0 4.0 6.0
Average 19 38.0 38.0 44.0
Good 19 38.0 38.0 82.0
Excellent 9 18.0 18.0 100.0
Total 50 100.0 100.0

40

35

30

25

20 Frequency
Percent
15

10

0
Very Poor Poor Average Good Excellent

Interpretation: 6% people are not satisfied from their interest rate but rest of them are
satisfied from their interest rate. 38% average, 56% lies in good and exellant.

3.3 FINANCIAL HIGHLIGTHS

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 Chapter 4
Summary, Conclusions
and Recommendation

60
 4.1 FINDING OF THE STUDY
Almost all the people are aware of Mahindra finance. 62% people are aware of the
Mahindra Fianace.
Not all the people know about FD scheme of Mahindra Finance in Jalandhar. 14%
of people are aware of Mahindra Finance.
Only few people are aware of its competitors due to lacking of a department in the
city.
Study shows that peoples perception about Mahindra Finance is highly positive so
it should adopt the steps to maintain that position.
The profits and net worth are increasing every year.
The number of contracts have also increased.
92% people are highly satisfied with its customer care service.
People are saving a huge part of their income for investment in long term because
of high rate of return.
Most of the people now a days are preferring in fixed deposit because of less risky
than shares or other investmenst.
The study shows that the customers know that the Mahindra is proving good
products and there are very less no. of people who says that the interest rate is
good. But they say the brand name is very good.
According to the survey respondents are of the opinion that they look for the
returns before investing in any company.
The study reveals that the 68% are happy with the services of Mahindra and
Mahindra and mostly the people like the quality so overall evaluation is also good.

What should the Company do to promote their FD in Jalandhar.?

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To start dealing of Fixed deposit at Local level:-As I have worked there for 2 months I
have concluded that brokers are not so willing or we can say that they are facing
problems because of not having any employee at local branch. He himself has to collect
and deposit the FD in Jalandhar. So sometimes brokers ignore these kind of tasks which
is directly a loss for the this kind of organization. So Mahindra should set up Mutual
Fund department in local branch which should take care of each and every thing of its
city because jalandhar is a big city and there are so many investors who are ready to
invest in Mahindra Finance.

To increase the number of broker :- As in Jalandhar even brokers are not aware about
the Mahindra Finance Fixed deposit . So first of All they shoud be aware of this product
even then they can sell it to the customers and if the number of brokers are more the sale
will also be more.

To Increase the commission of brokers:- According to me Mahindra should slightly

increase the Commission on FD because the broker is getting only 0.25% commission.
So only for this amount broker is not willing to do this kind of work. Other competitors
are giving higher rates of interests so naturally they will attract more to those companies.

By Targetting Appropriate market:- Mahindra is in so many other businesses also such

as two wheelers, automobiles, loans etc and now a days each and every people wants to
save and invest their moneey so it should conatact all of its customers about its new
product so that they can easily deposit their money.

4.2 My Woking Experience in Mahindra & Mahindra Financial

Services Ltd.

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 My working experience in this kind of organization is very good because before
joining this organization I was feeling not so good because I was not familiar with
this kind of organizational environment and I did not know that how this
organization runs. But when I joined this company I was assigned, we can say the
whole department of Fixed Deposit of Jalandhar city. Because there is not any
separate department of FD in the city so in this 2 months I was the person who
was handling each and everything regarding fixed deposit so it was a very big
achievement for me. My parents have their own FDs in banks but at that time I
was not aware about fixed deposit but after this internship and by practical
knowledge I came to almost all the aspects of FD.

On the first day I was feeling so nervous when the data was
provided to me for calling. But when I started doing this it was started becoming
interested for me because every day I made calling to different persons and in the
evening I met out of those people who were interested for Fixed Deposit or
Empanelment.

As the rightly said we learn something from everything, same as I

have learned so many things in these 2 months e.g. professional ethics how to talk
on phone, how to take appointments from client, how to deal with them, how to
behave when somebody insults about your product, we can say how to show
patience to clients. These all things would definitely help me in my career.

On the starting days it was so difficult to deal with a customer because now a days
every persons analyze each and everything before investing into any type of
investment, so then I searched about its competitors and their rates and ratings so
before reading that data I started visiting clients so that I should have enough
knowledge to keep my product different from its competitors, and solve the
queries of clients.

These things I have learned about FIXED DEPOSIT:

Process of Fixed Deposit

Reason behind why the company has started this scheme

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 Benefits of Pan card
How to maintain documents
How to deal with clients
Cumulative and Non Cumulative Interest plans
Different kinds of Forms e.g. 15 G and 15 H.
Knowledge about mutual Funds

These things I have learned through Empanelment Process:

How to fix a meeting or how to take appointments.

Most of the brokers start questioning so we should have each and every
knowledge before going to meet him/her.
How to show patience because brokers always try to demoralize.
When I met some of the brokers, they were very kind to me and told me some
practical concepts about some financial terms and specially about Mutual Fund.

4.3 Conclusion of the Study

Mahindra and Mahindra have very high market share. The company is offering good
services which reflected on the satisfaction of the customers. Mahindra and Mahindra
providing better facility than the other .

On the first mostly the people are preferring FD with good rate of interest rather
than any other scheme So Mahindra is competing with two organizations in the
terms of Fixed Deposit, these are
HDFC Bank ( Because of CRISIL FAAA rating) and
Shriram Transport Finance Ltd. ( Because of Higher rate of interest)

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 The second thing I have found that brokers are not so willing to sell this product
because of less interest rates as compared to its customers.
In the city like Jalandhar, as one of the major city of state Punjab, does not have
any FD department, which is resulting the problem for those who are ready to
invest in FD
Another thing is found that some people are still stuck with govt. banks for their
investment.

To conclude we can say that people prefer more branded and variety of products with
good rate of interest. Customers also feel that there should be proper customer service. As
customer satisfaction plays a vital role, it has to be concentrated on seriously. The report
reveals that there is huge scope for the growth of organized retailing. The main factor that
affects the business is location.They seek value for money so also matter for customers
to focus mainly on the service part. The reason for which people prefer to buy from
organized and reputed companys product available under one roof and customer has
not to move to other as it has its department in Amritsar, Ludhiana, Patiala and
Chandigarh but not in local branch.

4.4 Suggestions and Recommendations

Mutual Fund department in local Jalandhar branch.

More focus on quality product with best services.
Providing after sales services to build a brand.
To increase the number of brokers.
Customer service should be improved.
Proper training should be given to employees as to how to attract more customers
and how to retain them.
All the employees should have proper knowledge of every product so they can
easily fetch the customer needs.

65
 Keep update their customers about their new schemes.
It should revise its interest rates and commissions.
It should reduce its time period of making a FD Which is Minimum 15 days
As the Jalandhar City is not so much aware of Mahindra Finance Fixed Deposit ,
It should start and campaign at local level to aware the people about its products.
Most of the people are not aware of CRISIL or Its FAAA rating which is the best
thing in this product because safety of the money come first rather than the
interest rates
It should take timely feedback from its customers as well as its brokers also
A special training program should be there for its customers.
The people should be well intelligent to solve each query of the customer.

Chapter 5
66
 Bibliography & References

BIBLOGRAPHY & REFERENCES

1 Introduction, Products and services www. Mahindra.com Mahindra

org, inc 2010 http://www. mahindra.com//

2 ( Sharma and Joshi 2012) http://ijmr.net/wp

content/uploads/2013/03/Demogpaphic Concept of rural marketing for
Mahindra-india.pdf

3. http :// www.goodreturns.in/ Reasons to invest in Mahindra finance FDs

( www.Good returns.in)

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 4. http://www.imf.org/external/pubs/ft/fandd/2002/09/nsouli.htm
(www.imf.org)

5. (myinvestmentideas.com/.../, 2013) major companies of fixed deposits

http://www.Investmentideas.com//.

6. (economictimes.com// markets and stocks, 2010) company history

http://www.Economictimes.com//

Appendices
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MAHINDRA FINANCE BRAND AWARENESS QUESTIONNAIRE

DEMOGRAPHIC DATA

1. Name of the customer_________________ 2. Contact No. __________________

3. Occupation ________________________ 4. Gender ________________

5. Education ________________________ 6. Age _________

7. Family income (approx) ______________ 8. Family Size ________________

1) What is your annual Income?

(a) 1-1.5 Lacs( ) (b)1.5 to 3 Lacs( ) (c)3 Lacs and Above( )

2) What percentage of your annual income do you save to Invest ?

(a) 5 to 10%( ) (b)10 to 20%( ) (c) 20% and above( )

3) Do you prefer to invest for long term or short duration?

(a) Long Term( ) (b) Short Term( )

4) Where do you prefer to invest your money?

(a) Mutual Funds( ) (b) Fixed Deposit( ) (c) Post Office Deposit( )

(d) Share / Commodity Market( ) (e) Other Investment Options( )

5) Are you aware about Mahindra Finance?

(a) Yes( ) (b) No( )

6) How you came to know about Mahindra Finance?

(a) Newspaper( ) (b) Advertisements( ) (c) Friends( )

(d) Online websites( ) (e ) Others ( )

7) Which products do you use?

(a) Fixed Deposits( ) (b) Mutual funds( )

(c) Insurance ( ) (d) Loans( )

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 8) According to you which investment option has less risk ?

(a) Mutual Funds ( ) (b ) fixed deposit ( ) (c) Post office deposit ( )

(d)Realestate ( ) (e) share/commodity market ( )

9) Which of the following FDs are you aware of?

(a) Mahindra finance ( ) (b) Sri Ram finance ( ) (c) Muthoot finance ( )

(d) HDFC LTD ( ) (e) LIC home finance ( ) (f) Others ( )

10) If you invest in fixed deposit which gives better returns?

(a) SBI ( ) (b) HDFC ( ) (c) Mahindra ( )

(d) Shriram ( ) (e)Muthoot finance ( ) (f) others ( )

11) Rate Mahindra Finance on the following on a scale of 1 5: -

Very Poor Poor Average Good Excellent
(1) (2) (3) (4) (5)

a) Customer service ( ) ( ) ( ) ( ) ( )
b) Products ( ) ( ) ( ) ( ) ( )
c) Add on Services ( ) ( ) ( ) ( ) ( )

d) Interest provided ( ) ( ) ( ) ( ) ( )

12) Would you like to know more about Mahindra Finance FD?

(a)YES ( ) (b)NO ( )

13) Any suggestions

________________________________________________________________________
________________________________________________________________________
____________

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