security analysis and portfolio management ff1
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DECLARATION
I the undersigned here by declare that the project entitled
PORTFOLIO ANALYSIS &ANA!""NT is #y original $or% based
On #y o$n indings during practical training done in 'IRLA S(N LIF"
& INS(RAN)"*
I urther declare that to the best o #y %no$ledge the project
report has not been sub#itted in any degree or diplo#a in +i%ra# (ni,ersity*
I the declaration ound alse at any stage I shall be held
responsible or it that case I shall abide by the (ni,ersity-s rules and
regulations*
.ate /
Place / Signature o the
Student Na#e 00000
)lass 00000
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ACKOWLEDGEMENT
It is #y great pleasure and pri,ilege to ac%no$ledge the ,aluable guidance and
support1 I recei,ed in the preparation o this project report*
I $ish to e2press #y sincere gratitude and than%ulness to Mr.VIJAY SINGH,
Branch Manager, Bira S!n Li"e In#!rance C$%&an' L(). 3ho obliged #e a
chance to co#plete #y training at this estee#ed Organi4ation*
I a# e2tre#ely than%ul to the oicers and sta o 'irla Sun Lie Insurance)o#pany Ltd* For their 5ind )ooperation and i##ense help6 $ithout their support
and ,aluable guidance #y project $ould ha,e ne,er seen the light o the day*
This note o than%s $ould be inco#plete i I do not than% #y co7trainees $ith
$ho# I ha,e $or%ed in groups during the project and ad,isors o 'irla Sunlie
Insurance $ith $ho# I ha,e $or%ed during last stage o the project & has learned
,aluable things ro# the# and Acade#ic .e,elop#ent )ell 8A.)9 & aculty
#e#bers6 $ho al$ays encourage us to do challenging tas%s*
I a# deeply indebted to #y parents and riends or pro,iding #e all necessary help
in co#pleting #y project*
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INDE*
SR.
NO
DESCRIPTION PAGE
NO.
1. ABOUT BIRLA SUNLIFE INSURANCE 4-5
2. INTRODUCTION TO INDIAN INSURANCE
INDUSTRY
6-15
HISTORY
PLAYERS IN THE INDIAN INSURANCE SECTOR
ROLE OF IRDA
TYPE OF INSURANCE POLICIES
INTRODUCTION TO ULIPS
3. EXECUTIVE SUMMARY 16
4. RESEARCH METHODOLOGY 17-19
5. PORTFOLIO ANALYSIS & MANAGEMENTWHAT IS PORTFOLIO MANAGEMENT
MAGNIFIER FUND
MAXIMISER FUND
6.
SECURITY ANALYSIS 24-27
7.
COMPETITOR ANALYSIS ULIP!
COMPARISION"
2-!9
INTRODUCTION TO "SIL CLASSIC LIFE PLAN
COMPARISION WITH COMPETITION
INTRODUCTION TO "SIL PLATINUM AD#ANTAGE
PLAN
COMPARISION WITH COMPETITION#. ULIP! V! MUTUAL FUNDS 4$-41
INTRODUCTION TO "SIL FORESIGHT PLAN
RETURNS COMPARISION OF FORESIGHT #%.
MUTUAL FUND
$. SUMMARY & CONCLUSIONS 42-4!
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1%. RECOMMENDATIONS 44-45
11. REFERENCES & BIBILOGRAPHY 46
ABOUT BIRLA SUNLIFE INSURANCE
"stablished in :;;;6 Bira S!n Li"e In#!rance C$%&an' Li%i(e) +BSLI is a
joint ,enture bet$een the Aditya 'irla !roup6 A (S =;6;;; e#ployees6 belonging
to ?; dierent nationalities operating in :@ countries across si2 continents and
Sun Lie Financial Inc6 leading international inancial ser,ices organi4ation
ro# )anada*
The local %no$ledge o the Aditya 'irla !roup co#bined $ith the do#ain
e2pertise o Sun Lie Financial Inc*6 oers a or#idable protection or its
custo#ers uture* 3ith an e2perience o o,er >; years6 'SLI has contributed
signiicantly to the gro$th and de,elop#ent o the lie insurance industry in
India and currently ran%s a#ongst the top B pri,ate lie insurance co#panies in
the country*
5no$n or its inno,ation and creating industry bench#ar%s6 'SLI has se,eral
irsts to its credit* It $as the irst Indian Insurance )o#pany to introduce CFree
Loo% PeriodC and the sa#e $as #ade #andatory by IR.A or all other lie
insurance co#panies* Additionally6 'SLI pioneered the launch o (nit Lin%ed
Lie Insurance plans a#ongst the pri,ate players in India* To establish
credibility and urther transparency6 'SLI also enjoys the prestige to be the
originator o practice to disclose portolio on #onthly basis* 'SLI oer the
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co#plete bouDuet o insurance products ,i4* pure ter# plan6 lie stage products6
health plan6 retire#ent plan & (nit Lin%ed Insurance Plans 8(LIPs9 etc*
Add to this6 the e2tensi,e reach through its net$or% o B;; branches and >6
?@6E;; e#panelled ad,isors* This i#pressi,e co#bination o do#ain e2pertise6
product range6 reach and ears on ground6 helped 'SLI co,er #ore than :*?
#illion li,es since it co##enced operations and establish a custo#er base
spread across #ore than >;; to$ns and cities in India* 'SLI has ensured that it
has lo$est outstanding clai#s ratio o ;*;;G or FY :;>;7>>** Such ser,ices are
$ell supported by sound inancials that the )o#pany has* The A( o 'SLI
stood at >E@: crs a# $n A&ri -, /00, $hile the co#pany has a robust capital
base o Rs* :?; crs*
INTRODUCTION TO INDIAN INSURANCE
INDUSTRY
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HISTORY
Insurance in India has its history dating bac% till >H>H6 $hen Oriental Lie
Insurance )o#pany $as started by "uropeans in 5ol%ata to cater to the needs
o "uropean co##unity* Pre7independent era in India sa$ discri#ination
a#ong the lie o oreigners and Indians $ith higher pre#iu#s being charged
or the latter* It $as only in the year >H@;6 'o#bay utual Lie Assurance
Society6 the irst Indian insurance co#pany co,ered Indian li,es at nor#al rates*
At the da$n o the t$entieth century6 insurance co#panies started
#ushroo#ing up* In the year >E>:6 the Lie Insurance )o#panies Act6 and the
Pro,ident Fund Act $ere passed to regulate the insurance business* The Lie
Insurance )o#panies Act6 >E>: #ade it necessary that the pre#iu# rate tables
and periodical ,aluations o co#panies should be certiied by an actuary*
o$e,er6 discri#ination still e2isted bet$een Indian and oreign co#panies*
The oldest e2isting insurance co#pany in India is National Insurance )o#pany
Ltd6 $hich $as ounded in >E;B and is doing business e,en today* The
Insurance industry earlier consisted o only t$o state insurers/ Lie Insurers
i*e* Lie Insurance )orporation o India and !eneral Insurers i*e* !eneral
Insurance )orporation o India*
This #illenniu# has seen insurance co#e a ull circle in a journey e2tending to
nearly :;; years* The process o re7opening o the sector had begun in the early
>EE;s and the last decade and #ore has seen it been opened up substantially* In
>EE=6 the !o,ern#ent set up a co##ittee under the chair#anship o RN
alhotra6 or#er !o,ernor o R'I6 to propose reco##endations or reor#s in
the insurance sector* The objecti,e $as to co#ple#ent the reor#s initiated in
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the inancial sector* They stated that oreign co#panies be allo$ed to enter by
loating Indian co#panies6 preerably a joint ,enture $ith Indian partners*
Follo$ing the reco##endations o the alhotra )o##ittee report6 in >EEE6 the
Insurance Regulatory and .e,elop#ent Authority 8IR.A9 $as constituted as an
autono#ous body to regulate and de,elop the insurance industry* The IR.A
$as incorporated as a statutory body in April6 :;;;* The %ey objecti,es o the
IR.A include pro#otion o co#petition so as to enhance custo#er satisaction
through increased consu#er choice and lo$er pre#iu#s6 $hile ensuring the
inancial security o the insurance #ar%et*
The IR.A opened up the #ar%et in August :;;; $ith the in,itation or
application or registrations* Foreign co#panies $ere allo$ed o$nership o up
to :BG* The Authority has the po$er to ra#e regulations under Section >>?A
o the Insurance Act6 >E=H and has ro# :;;; on$ards ra#ed ,arious
regulations ranging ro# registration o co#panies or carrying on insurance
business to protection o policyholders- interests* In .ece#ber6 :;;;6 the
subsidiaries o the !eneral Insurance )orporation o India $ere restructured as
independent co#panies and at the sa#e ti#e !I) $as con,erted into a national
re7insurer* Parlia#ent passed a bill de7lin%ing the our subsidiaries ro# !I) in
July6 :;;:*
The insurance sector is a colossal one and is gro$ing at a speedy rate o >7
:;G* Together $ith ban%ing ser,ices6 insurance ser,ices add about @G to the
country-s !.P* A $ell7de,eloped and e,ol,ed insurance sector is a boon or
econo#ic de,elop#ent as it pro,ides long7 ter# unds or inrastructure
de,elop#ent at the sa#e ti#e strengthening the ris% ta%ing ability o the
country*
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1LAYERS IN THE INDIAN INS2RANCE SECTOR
Today there are :? general insurance co#panies including the ")!) and
Agriculture Insurance )orporation o India and := lie insurance co#panies
operating in the country*
>* 'ajaj Allian4 Lie Insurance )o#pany Li#ited:* 'irla Sun Lie Insurance )o* Ltd=* .F) Standard Lie Insurance )o* Ltd
?* I)I)I Prudential Lie Insurance )o* Ltd* IN! +ysya Lie Insurance )o#pany Ltd*B* Lie Insurance )orporation o India@* a2 Ne$ Yor% Lie Insurance )o* LtdH* et Lie India Insurance )o#pany Ltd*E* 5ota% ahindra Old utual Lie Insurance Li#ited>;*S'I Lie Insurance )o* Ltd>>*Tata AI! Lie Insurance )o#pany Li#ited>:*Reliance Lie Insurance )o#pany Li#ited*>=*A,i,a Lie Insurance )o#pany India Li#ited
ROLE O3 IRDA
The Insurance Regulatory and .e,elop#ent Authority Act o >EEE brought
about se,eral crucial policy changes in the insurance sector o India* It led to
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the or#ation o the Insurance Regulatory and .e,elop#ent Authority 8IR.A9
in :;;;*
The goals o the IR.A are to saeguard the interests o insurance policyholders6
as $ell as to initiate dierent policy #easures to help sustain gro$th in the
Indian insurance sector*
IR.A has notiied Protection o Policyholders Interest Regulations :;;> to
pro,ide or/ policy proposal docu#ents in easily understandable language1
clai#s procedure in both lie and non7lie1 setting up o grie,ance redressal
#achinery1 speedy settle#ent o clai#s1 and policyholders ser,icing* The
Regulation also pro,ides or pay#ent o interest by insurers or the delay in
settle#ent o clai#*
The insurers are reDuired to #aintain sol,ency #argins so that they are in a
position to #eet their obligations to$ards policyholders $ith regard to pay#ent
o clai#s* It is obligatory on the part o the insurance co#panies to disclose
clearly the beneits6 ter#s and conditions under the policy* The ad,ertise#ents
issued by the insurers should not #islead the insuring public* All insurers are
reDuired to set up proper grie,ance redress #achinery in their head oice and at
their other oices* The Authority ta%es up $ith the insurers any co#plaint
recei,ed ro# the policyholders in connection $ith ser,ices pro,ided by the#
under the insurance contract*
TY1ES O3 INS2RANCE 1OLICIES
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Ta%ing out a lie insurance policy co,ers the ris% o dying early6 by pro,iding
or your a#ily in the e,ent o your death* It also #anages the ris% o retire#ent
pro,iding an inco#e or you in non7earning years* )hoosing the right policy
type $ith the co,erage that is right or you thereore beco#es critical*
There are a ,ariety o policies a,ailable in the #ar%et6 ranging ro# Ter#
"ndo$#ent and 3hole Lie Insurance6 to oney 'ac% Policies6 (LIPs6 and
Pension plans* Lets see $hat each o these is about6 so that you can consider
the one that best suits you*
Ter% In#!rance
Ter# Insurance6 as the na#e i#plies6 is or a speciic period6 and has the lo$est
possible pre#iu# a#ong all insurance plans* You can select the length o the
ter# or $hich you $ould li%e co,erage6 up to = years*
Pay#ents are i2ed and do not increase during your ter# period* In case o an
unti#ely death6 your dependents $ill recei,e the beneit a#ount speciied in the
ter# lie insurance agree#ent* You can custo#i4e Ter# lie insurance $ith theaddition o riders6 such as )hild6 3ai,er o Pre#iu#6 or Accidental .eath*
En)$4%en( In#!rance
"ndo$#ent Insurance is ideal i you ha,e a short career path6 and hope to enjoy
the beneits o the plan 8the original su# and the accu#ulated bonus9 in your
lie ti#e*
"ndo$#ent plans are especially useul $hen you retire1 by buying an annuity
policy $ith the su# recei,ed6 it generates a #onthly pension or the rest o your
lie*
Wh$e Li"e In#!rance
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3hole Lie Policies ha,e no i2ed end date or the policy1 only the death
beneit e2ists and is paid to the na#ed beneiciary* The policy holder is not
entitled to any #oney during his or her o$n lieti#e6 i*e*6 there is no sur,i,al
beneit* This plan is ideal in the case o lea,ing behind an estate*
Pri#ary ad,antages o 3hole Lie Insurance are guaranteed death beneits6
guaranteed cash ,alues6 and i2ed and %no$n annual pre#iu#s*
M$ne'5Bac6 1an
In a oney7'ac% plan6 you regularly recei,e a percentage o the su# assured
during the lieti#e o the policy* oney7'ac% plans are ideal or those $ho areloo%ing or a product that pro,ides both 7 insurance co,er and sa,ings*
It creates a long7ter# sa,ings opportunity $ith a reasonable rate o return6
especially since the payout is considered e2e#pt ro# ta2 e2cept under
speciied situations*
2LI1
(nit7lin%ed Insurance Plans 8(LIPs96 introduced by the pri,ate players6 are
hugely popular6 because they co#bine the beneits o lie insurance policies
$ith #utual unds* A certain part o the pre#iu# is in,ested in listed
eDuitiesKdebt undsKbonds6 and the balance is used to pro,ide or lie insurance
and und #anage#ent e2penses*
1en#i$n 1an
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Insurance co#panies oer t$o %inds o pension plans 7 endo$#ent and unit
lin%ed* "ndo$#ent plans in,est in i2ed inco#e products6 so the rates o return
are ,ery lo$*
(nit7lin%ed plans are #ore le2ible* You can stop contributing ater >; years
and the und $ill %eep co#pounding your corpus till the ,esting date* You can
opt or higher e2posure in the stoc% #ar%et or your plan i your ris% appetite
allo$s it* Lo$er ris% options li%e balanced unds are also oered*
Ri)er#7 C$%&rehen#i8e c$8erage
In addition to the insurance plan o your choice6 you #ight $ant to consider additional ris% co,ers6 in $hich case you can you can opt or riders/ additional
beneits that can be purchased $ith an insurance policy*
"2a#ples o riders include the Ter# rider6 the Accidental .eath 'eneit rider6
and the )ritical Illness rider* )hoosing the right set o riders ensures a
co#prehensi,e insurance co,er*
INTROD2CTION TO 2LI1S +2NIT LINKED INS2RANCE
1LANS
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The introduction o (nit Lin%ed Insurance Plans has possibly been the single
largest inno,ation in the ield o lie insurance *It has addressed and o,erco#e
#any diiculties and concerns that custo#ers had about lie insurance
liDuidity6 le2ibility6 and transparency* These beneits are possible because
(LIPs are dierently structured products and lea,e #any choices to the
policyholder* They are structured such that the protection 8insurance9 ele#ent
and the sa,ings ele#ent 8in,est#ent9 can be distinguish and hence #anaged
according to one-s speciic needs6 oering le2ibility and transparency* Thus $e
can say it is such a product that ta%es care o #ultiple needs* (LIPs are also
called as M'undled Policies*
There $ere so#e actors $hich ga,e entry or (LIPs in the insurance #ar%et/ 7
Firstly $as the arri,al o pri,ate o pri,ate players6 and (LIPs $ere the #ost
signiicant inno,ation done by the#6 and secondly $as the decline o assured
returns in endo$#ent plans* "arly the #ar%et o (LIPs $as ta%en up 'irla Sun
Lie as they $ere the irst to introduce such product in the #ar%et* These are the
insurance plans $hich are attached to (nits* The pre#iu# a#ount recei,ed in
this policy6 so#e part is used in in,est#ent o unds and re#aining is used or
insurance co,er*
(LIPs are re#ar%ably si#ilar to6 #utual und in ter#s o structure and
unctioning/ pre#iu# pay#ents are con,erted into units and net asset ,alue
8NA+9 is declared regularly* In,estors ha,e an option o choosing their und
according to their ris% ta%ing ability* They disclose all the #aterial acts #ost
reDuent and consistent 8oten Duarterly or hal7yearly9 *Also in,estor has a
airly good idea about e2penses* The e2penses $hich are considered are as
ollo$s/7
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1) Mortality Rate/ 7 These are charged by the lie insurance co#pany to co,er
the ris% o an e,entuality to the indi,idual*2) Adminitration! ale"mar#etin$ C%ar$e& ' All lie insurance co#panies
incur certain e2penses on regular basis* Agent-s co##ission6 sales &
#ar%eting e2penses and o,erhead costs incurred to run the day to day basis
are so#e e2a#ples*() Fnd Mana$ement C%ar$e& ' These charges are le,ied by the insurance
co#pany to co,er the e2penses incurred by the# on #anaging (lip #onies**) Uli+',nd S-it.% C%ar$e& ' These charges are borne by the indi,iduals
$hen they decide to s$itch their6 #oney ro# one type o und to another*/) To+'+ C%ar$e& A certain percentage is deducted ro# the top7up a#ount to
reco,er the e2penses incurred on #anaging the sa#e*
(LIPs are ,ery dierent ro# the traditional policies because they are based on
so#e unda#entals o utual unds as dierent types o unds $hich are
created $herein the pre#iu#s $hich are recei,ed on the policy these are
in,ested in these unds basically these unds are o ollo$ing types/7
a E9!i(' + A$$rei0e"ro-t%) Fnd/7Such unds in,est a #ajor portion in
eDuity #ar%ets* They are thereore considered to be high on ris% para#eter*
: Det Fnd/ 7 These types o unds in,est the pre#iu# #oney in debt
instru#ents li%e g7secs6 bonds and AAA rated securities* Such unds are lo$
ris% in nature*
c Balan.ed Fnd/ 7 This und is co#bination o gro$th & debt und* This#eans its portolio consists o both eDuities and debt instru#ents* The ris%
or this und is #oderate*
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) Money Mar#et"Li3id Fnd/7 Such a und in,ests the pre#iu# #oney
in short ter# liDuid instru#ents li%e ban% deposits and #oney #ar%et
instru#ents*
The "ea(!re# $" 2LI1# are a# "$$4#75
a9 Fle4iility& 7 Fle2ibility in choosing your o$n unds ho$ you $ould li%e
to in,est your o$n #oney*
b9 Tran+aren.y& 7 It discloses all your #aterial acts6 i*e* you %no$ $here
your #oney is been in,ested*
c9 Li3idity/ 7 ere you can $ithdra$ certain a#ount ro# your (nits $hichha,e been collected*
d9 Ta4 Bene,it/ 7 ta2 beneits are a,ailable under Section H;) subject to a
#a2i#u# li#it o Rs >;;6;;;*
The other eatures o (LIPs are li%e6 lie protection $hich can be adjustable6
#any in,est#ent options6 beneits li%e disability6 critical illness6 surgeries6
and also inancial planning etc*
/ E*EC2TIVE S2MMARY
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The project on Portolio anage#ent and analysis $as carried out $ith 'SLI* The
objecti,e o this project $as to pri#arily understand the ,arious unds o 'irla
Sunlie & analy4ing the peror#ance o ,arious scrip in,ol,ed in the portolio & to
suggest $hether the co#pany is #issing out on any peror#ing co#pany as an
in,est#ent option* The project also helped us in understanding the past
peror#ance o the co#panies & the i#pact co#panies had during recession* Ater
going through the balance sheet $e also tried to analy4e $hether the co#pany is
able to sur,i,e any recession in near uture & $hat $ill be the i#pact on the#*
In the second part o the project dealt $ith (LIP co#parison o ,arious players*
For this product brochures o dierent lie insurance co#panies $ere reerred*
Also the co#pany $ebsite $as used to ind out the peror#ance o the ,arious
unds* Fund co#parison $as done to ind out $hy a particular und has peror#ed
better than the other** In this part $e also co#pared highest NA+ products o #ajor
co#petitors & tried to analy4e the NA+ pattern o all the #utual unds as $ell as
insurance unds* ighest NA+ products peror#ance $as e,aluated as co#pared to
#utual unds* IRR calculation & analysis o each product based on IRR $as done*
In the third part o the project $e analy4ed the dierent in,est#ent options
a,ailable and to co#pare the# $ith the #utual und in,est#ents* For the purpose
o analy4ing the in,est#ent pattern and selecting eecti,e and beneicial sche#es
o #utual unds dierent a,ailable sche#es $ere thoroughly analy4e & insurance
can be used as an in,est#ent option $as pro,e
- RESEARCH METHODOLOGY
;.0 Re#earch Brie"7
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The irst stage in,ol,ed initial discussion bet$een the ,arious tea# #e#bers and
the co#pany in order to identiy the research objecti,es 8Rationale o the research96
$hich is the #ost diicult step in the research process*
;./ Re#earch De#ign7
Research design is the arrange#ent o condition or collection and analysis o data
in a #anner that ai#s to co#bine rele,ance to the research purpose $ith the
econo#y in procedure* It is the blueprints or collection6 #easure#ent and analysis
o data*
;./.0 T'&e $" Re#earch7 Ana'(ica Re#earch
(nder the analytical research6 the researcher has to use acts or inor#ation already
a,ailable and analy4e the acts and inor#ation to #a%e a critical e,aluation o the
#aterial* The research is designed to study the peror#ance o insurance
co#panies in the post7liberali4ation era*
(nder this type the researcher has to use the acts and inor#ation already
a,ailable and analy4e the# to #a%e e,aluation o the #ar%et* In analytical research
the researcher has to use the acts already a,ailable6 and analyse these to #a%e the
critical e,aluation data o the #aterial*
The %e(h$)$$g' "$$4e) "$r re#earch i# a# "$$4ing7
>* Sur,ey o concerned literature
:* )ollecting data/
• uantitati,e
• ualitati,e
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=* Ater the collection o data the ra$ data is processed through editing6 loading6
classiication and tabulation to #a%e analysis o the data o inor#ation
Ater the analysis the inding are dra$n and reco##endationsKconclusion are
#ade*
The research design $hich help to ans$er the ollo$ing Duestions/
• 3hy the study is being #ade
• Fro# $here the data needed can be collected
;././ Da(a C$ec(i$n7
0. 1ri%ar' Da(a7
These include the sur,ey or Duestionnaire #ethod6 telephonic inter,ie$ as $ell as
the personal inter,ie$ #ethods o data collection
:* Secondary .ata/
The secondary data as it has al$ays been i#portant or the co#pletion o any
report pro,ides a reliable6 suitable6 adeDuate and speciic %no$ledge*
Secondary data is a data6 $hich is collected ro# ,arious sources* Secondary data
is not a resh data so it has its o$n li#itations li%e/ Ti#e )onstraints6 Accuracy and
Applicability*
The sa#ple si4e or #easuring the peror#ance or lie insurance co#panies is as
ollo$s/
This study is based on analysis the peror#ance o dierent lie insurance
co#pany in India6 LI) is the #ajor player in the #ar%et6 there are := other lie
insurance co#panies operating in the country* Thus the si4e o the uni,erse is :?*
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Out o these >B co#panies6 ? co#panies are selected1 in these one is Public
)o#pany and other Three are Pri,ate )o#panies/
• 'irla Sunlie insurance
•
Lie Insurance )orporation o India• 'ajaj Allian4 lie insurance
• IN! +ysya lie insurance
Analysis pattern
Ater the data is collected and editing6 the ne2t job o the researcher is to present it
syste#atically* The collected data is so large6 co#ple2 and unarranged that it can-t
be processed $ithout arranging it according to sa#e characteristics*
The ollo$ing statistical and analytical tools ha,e been used/
!raph/
• +arious plans oered by the co#panies*
• Net Asset +alue o )o#panies #ajor Plans*
• ar%et Share o the co#panies*
• .ata has been collected ro# the Fact sheet o the ,arious insurance unds &
#utual und sche#es & used those data s or the research* In act sheet past
returns $ere gi,en o dierent unds*
1ORT3OLIO ANALYSIS < MANAGEMENT
Wha( i# 1$r("$i$ Manage%en(=
An in,estor considering in securities is aced $ith the proble# o choosing
ro# a#ong a large nu#ber o securities* is choice depends upon the ris%
return characteristics o indi,idual securities* e $ould atte#pt to choose the
#ost desirable securities and li%e to allocate his unds o,er this group o
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securities* Again he is aced $ith proble# o deciding $hich securities to hold
and ho$ #uch to in,est in each* The in,estor aces an ininite nu#ber o
possible portolios or groups o securities* The ris% and return characteristics o
portolios dier ro# those o indi,idual securities co#bining to or# a
portolio*The in,estor tries to choose the opti#al portolio ta%ing into consideration the
ris% return characteristics o all possible portoliosThe irst phase o the project in,ol,ed analy4ing the e2isting und portolios
underlying dierent insurance products oered by 'irla Sun lie Insurance*
The analysis in,ol,ed analy4ing the peror#ance o the unds 8portolios9
considering para#eters such as asset si4e6 asset allocation6 returns generated
o,er speciic ti#e periods $*r*t* 'ench#ar% Inde2 etc*
1ha#e# $" 1$r("$i$ Manage%en(>* Security Analysis:* Portolio Analysis=* Portolio Selection?* Portolio Re,ision
* Portolio ",aluation
0. Sec!ri(' Ana'#i#
+a 3!n)a%en(a ana'#i#7 This analysis concentrates on the unda#ental
actors aecting the co#pany such as "PS 8"arning per share9 o the co#pany6
the di,idend payout ratio6 co#petition aced by the co#pany6 #ar%et share6Duality o #anage#ent etc*
+: Technica ana'#i#7 The past #o,e#ent in the prices o shares is studied to
identiy trends and patterns and then tries to predict the uture price #o,e#ent*
)urrent #ar%et price is co#pared $ith the uture predicted price to deter#ine
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the #ispricing* Technical analysis concentrates on price #o,e#ents and ignores
the unda#entals o the shares*
+c E""icien( %ar6e( h'&$(he#i#7 This is co#parati,ely #ore recent approach*
This approach holds that #ar%et prices instantaneously and ully relect all
rele,ant a,ailable inor#ation* It #eans that the #ar%et prices $ill al$ays be
eDual to the intrinsic ,alue*
/. 1$r("$i$ Ana'#i#
A portolio is a group o securities held together as in,est#ent* It is an atte#pt
to spread the ris% all o,er* The return & ris% o each portolio has to be
calculated #athe#atically and e2pressed Duantitati,ely* Portolio analysis phase
o portolio #anage#ent consists o identiying the range o possible portolios
that can be constituted ro# a gi,en set o securities and calculating their ris%
or urther analysis*
-. 1$r("$i$ Seec(i$n
The goal o portolio construction is to generate a portolio that pro,ides the
highest returns at a gi,en le,el o ris%* arry ar%o$it4h portolio theory
pro,ides both the conceptual ra#e$or% and the analytical tools or
deter#ining the opti#al portolio in a disciplined and objecti,e $ay*
;. 1$r("$i$ Re8i#i$n
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The in,estorKportolio #anager has to constantly #onitor the portolio to ensure
that it continues to be opti#al* As the econo#y and inancial #ar%ets are highly
,olatile dyna#ic changes ta%e place al#ost daily* As ti#e passes securities
$hich $ere once attracti,e #ay cease to be so* Ne$ securities $ith anticipation
o high returns and lo$ ris% #ay e#erge*
>. 1$r("$i$ E8a!a(i$n
Portolio e,aluation is the process6 $hich is concerned $ith assessing the
peror#ance o the portolio o,er a selected period o ti#e in ter#s o return &
ris%* The e,aluation pro,ides the necessary eedbac% or better designing o
portolio the ne2t ti#e around*
?. Mea#!re%en( $" ri#6
Ris% reers to the possibility that the actual outco#e o an in,est#ent $ill dier
ro# the e2pected outco#e* In other $ords $e can say that ris% reers to
,ariability or dispersion* 3hene,er $e calculate the #ean returns o an
in,est#ent $e also need to calculate the ,ariability in the returns*
The irst phase o the project in,ol,ed analy4ing the e2isting und portolios
underlying dierent insurance products oered by 'irla Sun lie Insurance* The
analysis in,ol,ed analy4ing the peror#ance o the unds 8portolios9
considering para#eters such as asset si4e6 asset allocation6 returns generated
o,er speciic ti#e periods $*r*t* 'ench#ar% Inde2 etc*
Ana'#i#7
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• The a2i#iser und is si#ilar to agniier und in that it is also
predo#inantly eDuity oriented und & has #ore than HG e2posure into
eDuity*
•
It is an old und co#pared to agniier & has higher assets under#anage#ent 8A(9 $hich is positi,e because it gi,es it #ore ability to ta%e
ris%s & has #ore holding capacity & it can also di,ersiy #ore*
• The und has outperor#ed its bench#ar% in recent years but loo%ing at
higher : years returns & lo$ returns since inception indicates that during the
recession o :;;H6 it has underperor#ed by a $ider #argin but has
reco,ered Duic%ly in the past : years*
• Its )A!R return since launch is lo$er than agniier & but has gi,en
higher returns co#pared to agniier in the past t$o years indicating that
the und is #ore ,olatile co#pared to agniier*
SEC2RITY ANALYSIS
Ater analy4ing the und portolios : sectors & scrip in that sector $hich $as
8or could be9 the part o the e2isting portolios $ere analy4ed in details to
re,ie$ the peror#ance o the sector & scrip o,er past = years*The basic concept o analy4ing the co#pany & understanding $as to get these
ollo$ing details/
• 3hat actors aected the co#pany $hich resulted in increase or decrease in
its stoc% price• 3hich sectors $ere i#pacted during recession
• In $hich co#panies $e should increase the e2posure & $hy
• Peror#ance o the co#pany & gro$th o stoc% price in three years
• Find the reco,ery period o co#panies ater recession
• Finding the stoc% luctuation in past three years
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• 'alance sheet analysis o the co#pany
• 3hich co#panies can sur,i,e another recession i double dip occurs in near
uture
The "$$4ing )a(a 4a# c$ec(e) < ana'@e) in )e(ai.
• The e,eryday Open6 igh6 Lo$ & )lose price6 +olu#e traded o the
scrip ro# >st April :;;H to =>st arch :;>> recorded on the stoc%
e2changes $as collected*
• The 3ee%ly6 Fortnightly6 onthly6 uarterly6 Se#i7Annually6 Annually
a,erages $ere then calculated in the e2cel sheet*• The data $as also plotted on a line graph to analy4e the trend in the stoc%
o,er the three year period
• The All7ti#e igh & All7ti#e lo$ o the stoc% o,er a three year period
$as ound out & probable reasons behind the sa#e $ere e2plored*
• Also any signiicant rise or do$nall in the stoc% $as ound & probable
reasons $ere e2plored*
• ",ery Pyra#id 8Rise & subseDuent all9 & In,erted Pyra#id 8all &
subseDuent rise9 pattern on the plotted graph $ere highlighted & also
analy4ed*
• Also the reco,ery period o the stoc% in days $as calculated i*e* the ti#e
stoc% too% to reco,er the global recession o :;;H*
• The detailed 'alance Sheet analysis o the stoc% $as carried out to judge
$hether the co#pany under analysis $ill be able to reco,er another
recession in the uture i it $ere to happen*
L&T has di,ersiied business portolio and it operates through its dierent
operating di,isions
$hich include/
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• "ngineering & )onstruction Projects
• "P) Po$er
• ea,y "ngineering
• "ngineering6 )onstruction & )ontracts
• "lectrical & "lectronics• achinery & Industrial Products
• IT and Integrated "ngineering Ser,ices
• Financial Ser,ices
L&T6 one o the India-s largest "ngineering )o#panies6 $as incorporated in
February >E?B* It $as con,erted into a public li#ited co#pany in >E;* L&T6
along $ith its group co#panies6 pro,ides integrated design6 engineering6
procure#ent6 construction and project #anage#ent ser,ices to ,arious sectors* The
co#pany is present in #ultiple operating seg#ents such as "ngineering &
)onstruction 8"&)96 "lectrical & "lectronics 8"&"96 achinery & Industrial
Products 8IP9 and others* It has e2posure to inrastructure 'OT projects in roads6
ports and real estate* Through its subsidiaries li%e L&T Finance6
L&T Inrastructure Finance and L&T Inotech6 L&T has also di,ersiied intoinancial ser,ices and the ITKITeS sector*
The "&) di,ision o L&T underta%es engineering
design and construction o buildings6 actories6 inrastructure6 industrial and po$er
trans#ission & distribution6 $hile the "&" seg#ent is engaged in #anuacturing
o electrical standard products6 syste#s and eDuip#ent*
The IP di,ision o L&T is ocused on #anuacturing
industrial ,al,es6 construction and hydraulic eDuip#ent6 #achinery or #ining6
paper and rubber processing industry*
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L&T is regarded as the pree#inent inrastructure #ajor
oten reerred to as the Qbuilder o the India o the :>st century-* Its
achie,e#ents across sectors include/
• ydrocarbon projects e2ecuted in India6 the iddle "ast and South "ast
Asia
• Po$er projects e2ecuted in India6 the !ul and Sri Lan%a*
• The $orld-s largest coal gasiier #ade in India and e2ported to )hina
• The $orld-s biggest "O Reactor or a petroche#ical co#ple2 in the !ul
• The $orld-s largest F)) 8Fluid )atalytic )rac%er9 Regenerator or a reinery
• Asia-s highest ,iaduct
• Inrastructure projects in Jordan6 (*A*"* and South "ast Asia
• The $orld-s longest li#estone con,eyor • India-s $idest range o s$itchgear
• A $ide range o construction and #ining eDuip#ent
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COM1ETITORS ANALYSIS +2LI1#
COM1ARISION7
This phase o the project in,ol,ed co#paring one o the #ost successul (LIP
product under 'SLI i*e* 'SLI )lassic Lie Plan stable $ith the e2isting si#ilar
products o co#petitors in the #ar%etplace*
Ater identiying the si#ilar product o co#petitors & collection o rele,ant
data6 the detail co#parison $as carried considering all the para#eters
#entioned abo,e* The co#petitors selected or the study included LI)6 'ajaAllian4 & IN! +ysya*
INTROD2CTION TO BSLI CLASSIC WHOLE LI3E 1LAN
3hile one $or%s hard to$ards achie,ing a#bitions6 one also $ishes to sa,e or
a co#ortable retire#ent* And $ant a plan that gi,es you the le2ibility to
#anage your sa,ings* The 'SLI )lassic Lie Plan gi,es co#plete control o,er
the in,est#ents by directing pre#iu#s to range o >; In,est#ent Funds along
$ith a range o rider options to gi,e the security o inancial protection*
This plan oers/
• Fle2ibility o directing your sa,ings in >; In,est#ent Funds6 as per ris%
appetite
• )hoice o Pay Ter#• 3hole lie co,er
• "nhanced inancial security or lo,ed ones
H$4 BSLI Ca##ic Li"e 1an 4$r6#=
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• Select the Sa,ings .ate that suits your retire#ent goals*
• Select the 'asic Pre#iu# you $ant to pay e,ery year*
• Recei,e 'asic Su# Assured $hich is the #ini#u# death beneit payable on
the de#ise o the lie insured*
• Select the nu#ber o years you $ant to pay your pre#iu#s6 and select your
Pay Ter# ro# option o 7Pay K >;7Pay K >7Pay K :;7Pay K To Sa,ings
.ate*
• It also has the option to choose "nhanced Su# Assured to increase the
inancial security or lo,ed ones* This increases lie co,er o,er and abo,e
the 'asic Su# Assured at a no#inal cost*
• It also has the option to choose ro# our range o riders and custo#i4e the
security o your a#ilys inancial uture*
1an S!%%ar'7
Policy Ter# 3hole lie
"ntry Age >H to ? years >H to ; years >H to years >H to B; years
Sa,ings .ate To age To age B; To age B To age @;
'asic Pre#iu# ini#u# Rs* :6;;; p*a* i paid annuallyini#u# Rs* =;6;;; p*a* i paid #onthly6 Duarterly orse#i7annually
Pay Ter# Short pay 6 >;6 >6 :;years
To Sa,ings .ate
Pre#iu# Pay#entFreDuency
onthly6 uarterly6 Se#i7annually or Annually
Top7up Pre#iu# ini#u# Rs* 6;;;"nhanced Su# Assured ini#u# Rs* ;6;;;6 subject to #a2i#u# o =; years
to Sa,ings .ate
COM1ARISION WITH COM1ETITION
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INS2RER BIRLA S2N LI3E LIC
2LI1 CLASSIC LI3E 1LAN ENDOWMENT 1L2S
En(r' Age >H 7 B; Years @7B; Years
Ter% 3hole Lie >; to :; Years
1re%i!% 1a' Ter%pay6 >;pay6 >pay6Tosa,ings date
pay6to Policy ter#
Ma(!ri(' Age @; Years >H Years8in96@; Years8a29
M$)eYearly6 al7Yearly6uarterly6 onthly
Yearly6 al7Yearly6 uarterly6onthly
Ba#ic S!% A##!re)
'asic Pre#iu# #ultiplied by/ The higher o >; or thenu#ber o years to attain
age @; di,ided by :6 orentry ages belo$ ?1 or Thehigher o @ or the nu#ber o years to attain age @;di,ided by ?6 or entry ages? and abo,e
ini#u# Su# Assured/8Policy Ter# >9 ti#es theannuali4ed pre#iu#
a2i#u# Su# Assured/=; ti#es o the annuali4ed
pre#iu# i age at entry is upto? years: ti#es o the annuali4ed
pre#iu# i age at entry is ?B toB; years
G!aran(ee) A))i(i$n#
On >; policy anni,ersaryand on e,ery policyanni,ersary thereater*
!uaranteed Addition is:*;G o the 'asicPre#iu#s paid in the last B;#onths* In addition on >>
policy anni,ersary ande,ery policy anni,ersarythereater* !uaranteedAddition is ;*:G o thea,erage Fund +alue in the
last >: #onths
A guaranteed #ini#u# interestrate o =*G p*a* shall becredited to the .iscontinuedPolicy Fund constituted by theund ,alue o all discontinued
policies*
Dea(h C$8er
!reater o 8a9 the Fund+alue as on date ointi#ation o death or 8b9the 'asic Su# Assured
igher o Su# Assured and thePolicyholder-s Fund +alue shal
be a,ailable as death beneit*
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E(en)e) C$8er
"nhanced Su# Assured8#in Rs ;;;;97pre#iu#calculated accordingly6 Topup pre#iu#s 8#in Rs
;;;97'asic Su# Assured$ill be auto#aticallyincreased by the top7up
pre#iu# being paid#ultiplied by/>:G i theattained age o the lieinsured is less than ?years1 or >>;G i theattained age o the lieinsured is ? years or #ore
NO
Ri)er#
A2is'SLI Accidental .eath and.isability Rider 'SLI )ritical Illness Rider 'SLI Surgical )are Rider 'SLI ospital )are Rider 'SLI 3ai,er o Pre#iu#Rider
A2isAccident 'eneit Option)ritical Illness 'eneit Rider/
3!n) T'&e >; unds attached ? unds attached
A$ca(i$n Charge#
+0#( Year@*G o 'asic Pre#iu# @*G o 'asic Pre#iu#
A$ca(i$n Charge#
+/n) YearB*G o 'asic Pre#iu# G o 'asic Pre#iu#
A$ca(i$n Charge#
+-r) Year an)
$n4ar)#
*;G o 'asic Pre#iu# =G o 'asic Pre#iu#
A$ca(i$n Charge# +$n
an' ($& !& &re%i!%
:G o Top (p Pre#iu# paid
NA
3!n) Manage%en(
Charge#
>*;;G p*a* or Inco#eAd,antage6 Assure6Protector and 'uilder
;*;G p*a* o (nit Fund orM'ond Fund
>*:G p*a* or "nhancer and)reator
;*B;G p*a* o (nit Fund orMSecured Fund
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>*=G p*a* or agniier6a2i#iser6 ultiplier andSuper :;
;*@;G p*a* o (nit Fund orM'alanced Fund
;*H;G p*a* o (nit Fund or
M!ro$th Fund
1$ic' A)%in ChargeRs* :; per #onth or theirst i,e policy years*
Rs* =;K7 per #onth during theirst policy year*
Rs* : per #onth in thesi2th year and inlate at G
p*a* thereater*
Rs =;K7 per #onth escalating at=G p*a* thereater6 throughoutthe ter# o the policy shall bele,ied
INS2RER BIRLA S2N LI3E BAJAJ ALLIAN
2LI1 CLASSIC LI3E 1LAN I5GAIN III
En(r' Age >H7B; Years >H7B; Years
Ter% 3hole Lie >;6> & :; years
1re%i!% 1a' Ter% pay6 >; pay6 > pay6 Tosa,ings date pay7No li#it
Ma(!ri(' Age @; Years @ Years
M$)eYearly6 al7Yearly6uarterly6 onthly
Yearly6 al7Yearly6 uarterly6onthly
Ba#ic S!% A##!re)
'asic Pre#iu# #ultiplied by/ The higher o >; or thenu#ber o years to attainage @; di,ided by :6 orentry ages belo$ ?1 or The
higher o @ or the nu#ber o years to attain age @;di,ided by ?6 or entry ages? and abo,e
>; ti#es o Annuali4edPre#iu# or entry age belo$? years@ ti#es o Annuali4edPre#iu# or entry age ? years& abo,e
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G!aran(ee) A))i(i$n#
On >; policy anni,ersaryand on e,ery policyanni,ersary thereater*!uaranteed Addition is
:*;G o the 'asicPre#iu#s paid in the lastB; #onths* In addition on>> policy anni,ersary ande,ery policy anni,ersarythereater* !uaranteedAddition is ;*:G o thea,erage Fund +alue in thelast >: #onths
NA
Dea(h C$8er
!reater o 8a9 the Fund+alue as on date ointi#ation o death or 8b9the 'asic Su# Assuredreduced or partial$ithdra$als
Fund ,alue as on date o
receipt o inti#ation o death atthe )o#panys oice Thedeath beneit payable $ould becalculated separately orregular pre#iu# and top up
pre#iu#s*
E(en)e) C$8er
"nhanced Su# Assured8in Rs ;;;;97pre#iu#calculated accordingly6 Top
up pre#iu#s 8#in Rs;;;97'asic Su# Assured$ill be auto#aticallyincreased by the top7up
pre#iu# being paid#ultiplied by/>:G i theattained age o the lieinsured is less than ?years1 or >>;G i theattained age o the lie
insured is ? years or #ore
NA
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Ri)er#
A2is'SLI Accidental .eath and
.isability Rider 'SLI )ritical Illness Rider 'SLI Surgical )are Rider 'SLI ospital )are Rider 'SLI 3ai,er o Pre#iu#Rider
'ajaj Allian4 (L Fa#ilyInco#e 'eneit Rider 'ajaj Allian4 (L Ter# Rider 'ajaj Allian4 (L 3ai,er o
Pre#iu# 'eneit Rider'ajaj Allian4 (L )riticalIllness 'eneit Rider'ajaj Allian4 (L ospital )ash'eneit Rider'ajaj Allian4 (L AccidentalPer#anent Total K Partial.isability 'eneit Rider
3!n) T'&e >; unds attached @ und attachedA$ca(i$n Charge#
+0#( Year @*G o 'asic Pre#iu# : G o 'asic Pre#iu#A$ca(i$n Charge#
+/n) YearB*G o 'asic Pre#iu# : G o 'asic Pre#iu#
A$ca(i$n Charge#
+-r) Year an)
$n4ar)#
*;G o 'asic Pre#iu# : G o 'asic Pre#iu#
A$ca(i$n Charge# +$n
an' ($& !& &re%i!%
:G o Top (p Pre#iu# paid
:G o Top (p Pre#iu# paid
3!n) Manage%en(
Charge#
>*;;G p*a* or Inco#e
Ad,antage6 Assure6Protector and 'uilder
>*= G or "Duity !ro$th
Fund :6Accelerator id capund :6 Pure stoc% Fund
>*:G p*a* or "nhancerand )reator
>*: G or Asset allocation &'lue chip eDuity und
>*=G p*a* or agniier6a2i#iser6 ultiplier andSuper :;
;*E G or LiDuid & 'ondund
1$ic' A)%in Charge
Rs* :; per #onth or theirst i,e policy years* Rs*: per #onth in the si2thyear and inlate at G p*a*thereater*
Rs* =: per #onth inlating atG at each policy anni,ersary*The charge $ill be deducted ateach #onthly anni,ersary bycancellation o units*
M$r(ai(' Charge# 8>*?B to >B*:B@9 per >;;; >*@: to @*=@ per >;;;Mi#c. Charge# Rs* ; per reDuest or
pre#iu# re7direction6 unds$itch and partial
The #iscellaneous charge oRs*>;;K7 per transaction inrespect o change in pre#iu#
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$ithdra$al* Rs* >;; per policy re,i,al*
paying ter#
1ar(ia Wi(h)ra4a
(nli#ited partial$ithdra$als any ti#e ateri,e co#plete policy years*The #ini#u# a#ount o
partial $ithdra$al is Rs*6;;;* There is no#a2i#u# li#it6 but you arereDuired to #aintain a#ini#u# Fund +alue o Rs*:6;;; plus any top7up
pre#iu#s
All partial $ithdra$als $ill beirst #ade ro# eligible top up
pre#iu# und ,alue6 i any onFirst in First out 8FIFO9 basis*Once the eligible top up
pre#iu# und ,alue ise2hausted6 urther partial$ithdra$als $ill be #ade ro#the regular pre#iu# und ,alue
S!rren)er
One can surrender your policy to us ater theco#pletion o i,e policyyears and recei,e the Fund+alue at that ti#e*
One can surrender your policyto us ater the co#pletion osi2 policy years and recei,e theFund +alue at that ti#e*
LOANS
The #ini#u# loan a#ountis Rs* 6;;; and the#a2i#u# loan a#ount is?;G o the und ,alue neto any discontinuancecharges* The interest $echarge on such loans $ill bei2ed by us ro# ti#e toti#e
NA
1$ic' Di#c$n(in!ance
Charge#
For AP o Rs* :6;;; or#ore
In 1$ic' Year 0Lo$er o BG o AP6 BG oF+6 Rs* B6;;;
Lo$er o BG o AP6 BG o F+6Rs* B6;;;
In 1$ic' Year /Lo$er o ?G o AP6 ?G o
F+6 Rs* 6;;;
Lo$er o ?G o AP6 ?G o F+6
Rs* 6;;;
In 1$ic' Year -Lo$er o =G o AP6 =G oF+6 Rs* ?6;;;
Lo$er o =G o AP6 =G o F+6Rs* ?6;;;
In 1$ic' Year ;Lo$er o :G o AP6 :G oF+6 Rs* :6;;;
Lo$er o :G o AP6 :G o F+6Rs* :6;;;
In 1$ic' Year > Nil Nil
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Ana'#i#7
• The LI) o India has highest net in,estable pre#iu#6 Fund ,alue & IRR
ollo$ed by 'ajaj Allian4 & 'irla Sunlie due to lo$ o,erall cost structure
o LI)*
• 'SLI )lassic oers $hole lie co,er unli%e LI) endo$#ent plus $hich only
oers :; years #a2 policy ter#*
• 'SLI oers enhanced co,er option $hich is not a,ailable under LI)
endo$#ent plus*
• 'SLI )lassic plan oers a $ider choice o unds i*e*>; Funds co#pared to
LI) "ndo$#ent Plus $hich only oers choice o ? unds*
• 'SLI oers rider options unli%e LI) "ndo$#ent plus $hich oers only :
rider options*
• LI) "ndo$#ent Plus has lo$er ortality charges & und #anage#ent
charges co#pared to 'SLI classic plan*
• The und ,alue o 'SLI BG is lo$er than IN! +ysya but >;G gross
returns und ,alue & IRR o 'SLI are higher*
• 'SLI )lassic oers $hole lie co,er unli%e 'ajaj I7!ain III $hich only
oers :; years #a2 policy ter#*
• 'SLI )lassic oers guaranteed additions $hereas 'ajaj I7!ain III doesn-t
oer any such option*
• 'SLI )lassic oers enhanced co,er unli%e 'ajaj I7!ain III $hich doesn-t
oer any e2tended co,er*
• 'SLI )lassic plan oers a $ider choice o unds i*e*>; Funds co#pared to
'ajaj I7 !ain III $hich only oers choice o @ unds*• 'ajaj I 7!ain III has lo$er pre#iu# allocation charges & but higher und
#anage#ent charges & ad#in charges co#pared to 'SLI classic plan*
• 'SLI )lassic plan has lo$er ortality charges co#pared to 'ajaj I7 !ain
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• 'SLI )lassic oers $hole lie co,er unli%e IN! Prospering Lie $hich only
oers :; years #a2 policy ter#*
• 'SLI )lassic oers guaranteed additions $hereas IN! Prospering Lie
doesn-t oer any such option*• 'SLI )lassic oers Rider options unli%e IN! Prospering Lie $hich
doesn-t oer any rider options*
• 'SLI )lassic oers enhanced co,er unli%e IN! Prospering Lie $hich
doesn-t oer any e2tended co,er*
• 'SLI )lassic plan oers a $ider choice o unds i*e*>; Funds co#pared to
IN! Prospering Lie $hich only oers choice o unds*
• IN! Prospering Lie has lo$er pre#iu# allocation charges & #ortality
charges but higher und #anage#ent charges & ad#in charges co#pared to
'SLI classic plan*
3!n)# C$%&ari#$n7
The ,arious unds o the sche#es & their return peror#ance ha,e been presented
belo$*
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BIRLA SUN LIFE
3!n)# Ince&(i$n
3!n)
Manage%en(
Charge#
Re(!rn# +Since
Ince&(i$n
a2i#iser8H;7>;;G "9 Sep :;;@ >*=G 00.;>
)reator 8=;7;G "9 Jun :;;? >*:G 0;.;
"nhancer 8:;7=G "9 Jun :;;? >*:G 0-.-
'uilder 8>;7:;G "9 Jun :;;? >G 0.F
Inco#e Ad,antage 8>;;G .9 Jul :;;E >G 0-.?;
ultiplier 8H;7>;;G "9 No, :;;@ >*=G >.
Super :; 8H;7>;;G "9 Jul :;;E >*=G /0./
Assure 8>;;G .9 ar :;;H >G ./
Protector 8>;G "9 Jun :;;? >G .>0
agniier 8;7E;G "9 ar :;;H >*=G 0F.0F
LIC OF INDIA
3!n)# Ince&(i$n3!n)
Manage%en(
Charge#
Re(!rn# +Since
Ince&(i$n
!ro$th 8?;7@;G "9 Jan :;>; ;*H;G 5/./
'alanced 8=;7@;G "9 Jan :;>; ;*@;G 0.0-
Secured 8>7G "9 Jan :;>; ;*B;G 50.-F
'ond 8>;;G "9 Jan :;>; ;*;G /.>/
BA5A5 ALLIAN6
3!n)# Ince&(i$n
3!n)
Manage%en(
Charge#
Re(!rn# +Since
Ince&(i$n
"Duity !ro$th Fund II8B;G to >;;G"9 .ec :;>; >*=G 5/.0
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Pure Stoc% Fund8B;7>;;G "9 Jul :;;B >*=G 0?.?/
Assest Allocation8B;7>;;G "9 Oct :;;@ >*:G F.?
'luechip "Duity8B;7>;;G "9 No, :;>; >*:G 50/./-
LiDuid Fund8>;;G .9 Oct :;>; ;*EG .>F
'ond Fund Oct :;>; ;*EG Accelator id )ap Fund Jan :;>; >*:G 0-.>
ING VYSYA
3!n)# Ince&(i$n
3!n)
Manage%en(
Charge#
Re(!rn# +Since
Ince&(i$n
IN! Pri#e"Duity8>;;G "9 Jan :;>; >*=G >.F
IN! !ro$th Fund8B;G "9 No, :;;? >*:G 0/.0-
IN! 'alanced Fund8?;G "9 No, :;;? >*:G 0.
IN! Secure Fund8:;G "9 No, :;;? >G .F-
IN! Preser,er Fund8>;;G .9 Jan :;>; >G 00.0
Ana'#i#7
• agniier has gi,en highest returns co#pared to other unds in its category
ollo$ed by Pure Stoc% und o 'ajaj Allian4*
• ost o the unds under 'SLI ha,e gi,en good ris% adjusted returns o,er a
long ter# period*
• ost o the co#petitor-s unds are recently launched & ha,e not been able
to generate co#parable returns*
INTROD2CTION TO BSLI 1LATIN2M
ADVANTAGE 1LAN
This Plan gi,es the ad,antage to choose ro# : In,est#ent Options !uaranteed
Option and Sel7anaged Option* 3ith the !uaranteed Option in,est#ents in the
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Platinu# Ad,antage Fund are saeguarded ro# any do$nsides in the capital
#ar%ets* And it also oers options to enhance the inancial security o lo,ed ones6
at a no#inal additional cost* This plan oers a >;7year plan $ith a 7year Pay
Ter#*
H$4 BSLI 1a(in!% A)8an(age 1an 4$r6#7
>* )hoose the 'asic Pre#iu# one $ants to pay annually or years:* )hoose In,est#ent Option ro# Sel7#anaged Option or !uaranteed Option=* )hoose the "nhanced Su# Assured to increase the inancial protection o
your lo,ed ones?* )hoose ro# range o riders and saeguard a#ilys inancial uture
In8e#(%en( O&(i$n#7
Se"5Manage) O&(i$n/
The Sel7anaged Option gi,es the co#plete access to in,est pre#iu#s in $ell7
established suite o >; In,est#ent Funds6 ranging ro# >;;G debt to >;;G eDuity*
One can choose ro# our range o >; In,est#ent Funds6 to suit one-s ris% appetite
& can change allocations as per changing reDuire#ents
G!aran(ee) O&(i$n /
The !uaranteed Option allo$s in,esting your irst three annual pre#iu#s in
Platinu# Ad,antage Fund* This Fund co#es $ith a guarantee o the highest unit
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price recorded on a daily basis o,er @ years* It oers opti#al participation in
capital #ar%et gro$th6 $hile saeguarding in,est#ents and any gains thereon*
S2MMARY < CONCL2SION
The en(ire &r$ec( "in)ing# can :e #!%%ari@e) a# "$$4# /
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• )apital goods sector & ban%ing sector $as hit ,ery badly during recession*
)apital goods Sector stoc% price decreased by ?;G to ;G & 'an%ing
sector decreased by =; to ?;G*
•
All the ban%ing stoc%s touched their all7ti#e high during the period o No,e#ber :;>;
• The balance sheet analysis o the L&T stoc% sho$s that though the stoc%
underperor#ed during recession6 unda#entally the stoc% has the capability
to sur,i,e & rebound strongly ater recession
• The balance sheet analysis o A2is 'an% sho$s that it is one o the best
peror#ing pri,ate sector ban%s in the last i,e years* Though the stoc% price
$as badly hit during recession due to global #eltdo$n6 the peror#ance o
the ban% $as ,ery co##endable* The stoc% is a good potential in,est#ent
ro# a long ter# perspecti,e due to its ocus on e#erging sectors in India*
• Only :;G o the stoc%s o the portolio o 'ajaj Allian4 Pure Stoc% $as hit
during recession $hereas 'SLI #a2i #iser had :G stoc% i#pacted during
recession
• Pure stoc% is the best peror#ing und in the ast trac% und category
• )lassic lie Plan o 'SLI is the best product in the #ar%et or $hole lie
(LIP plans* No other co#petitors are oering such products* ost o these
%ind o product $as $ithdra$n in :nd hal o :;>;
• Fund anage#ent charges o LI) are ,ery less due to the huge pre#iu#
collections $ith the co#pany*
• ortality charge or higher age indi,iduals is less in 'SLI as co#pared to its
co#petitors*
•In the highest NA+ product category 'SLI-s platinu# ad,antage is the best
product in #ar%et both in ter#s o highest NA+ & Fund peror#ance*
• The concept Foresight is the best in,est#ent option a,ailable or the
in,estors as co#pared to other insurance plans & #utual unds considering
ris%7return trade o*
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• Foresight a$ards the in,estor $ith in,est#ent at best possible ti#e &
returns $ith highest NA+*
RECOMMENDATIONS
• 'SLI has ten unds in their portolio or classic lie but none o the portolio
$as able to sustain the recession during recession* In order to saeguard the
in,estor-s #oney they should construct a portolio $hich is not hit during
recession*
• 'SLI should balance its portolio $ith co#bination o gro$th stoc%s li%e
Ther#a2 & Yes 'an% & balance the portolio $ith in,est#ents in deensi,e
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stoc%s li%e (L6 IT)6 )IPLA6 'ASF etc* $hich are less li%ely to be aected
by the recession*
• 'SLI should #a%e a portolio $hich has li#ited e2posure in ban%ing &
)apital goods sector due to highly ,olatile nature o the sector especiallyduring recession*
• any insurance co#panies ha,e not pic%ed 'ajaj Auto in their portolio
$hile the past peror#ance o this stoc% is un#atchable*
• The uture o auto#obile is not sho$ing great signs $ith uncertainty in the
uel prices still 'ajaj Auto posted a ::G increase in latest Duarter*
• Teleco# sector has underperor#ed in the past = years due to the :! sca# &
urious co#petition in this sector6 but $ith all the proble#s sorted out 'hartiAirtel & Idea loo% as a descent bet in the long run*
• Sun Phar#a has been a peror#ing $ell ro# past = years & it $ill continue
to gro$ due to the strong de#and or healthcare all o,er the globe*
• In the capital goods sector )ro#pton !rea,es loo% a descent beat in the long
run due to the %ey #erger it has done in the last one year*
• IRR o 'SLI is least in the $hole lie product categories* The IRR can be
increased by increasing the guaranteed additions ro# the tenth year at a
higher percentage o the und ,alue* This guaranteed addition is already a
(SP o 'SLI*
• Inno,ati,e Products li%e oresight should be #ar%eted appropriately & #ore
a$areness should be created o the potential o the product to pro,ide high
ris%7adjusted returns to the in,estors*
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RE3ERENCES < BIBILOGRA1HY
$$$*birlasunlie*co#
$$$*irdaindia*org
$$$*#oneycontrol*co#
$$$*policyba4aar*co#
$$$*inditrade*co#
$$$*,alueresearchonline*co#
$$$*indiainoline*co#
$$$*hdc#*co#
~ 44 ~
http://www.birlasunlife.com/http://www.moneycontrol.com/http://www.policybazaar.com/http://www.inditrade.com/http://www.valueresearchonline.com/http://www.indiainfoline.com/http://www.hdfcmf.com/http://www.birlasunlife.com/http://www.moneycontrol.com/http://www.policybazaar.com/http://www.inditrade.com/http://www.valueresearchonline.com/http://www.indiainfoline.com/http://www.hdfcmf.com/
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