Summer Training Project Report ON

Demat Account

Submitted in Partial fulfillment of requirement of award of MBA degree of

GGSIPU, New Delhi

SUBMITTED BY
NITIN KUAMR TYAGI
MBA 3rd Semester-

Acknowledgement
It was a great opportunity for us to work with Sharekhan Ltd., pioneers in the field of Finance Industry. We are extremely grateful to all those who have shared their expertise and knowledge with me and without whom the completion of this project would have been virtually impossible. Firstly, we would like to thank our Company Guide Mr. Harshit Sur who has been a constant source of inspiration for us during the completion of this project. He gave us invaluable inputs during our endeavor to complete this project.

We are indebted to all staff of Sharekhan Ltd for their valuable support and cooperation during the entire tenure of this project. Not to forget, all those who have kept our spirits surging and helped delivering our best.

We thank our faculty guide Mrs. Poonam Purohit who helped us out at every critical situation that We faced in our project and gave us her valuable advice to solve problems.

We want to give our special thanks to all members of BIMS, for providing us opportunity to work on this project with this great organization. At last We would like to thank all the respondents met in the preparation, who gave their valuable time to provide us required information and their honest support to complete our project in time. Nitin Tyagi

TABLE OF CONTENTS FOR PROJECT REPORT

S.no
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Details of Document
Objective of Study Company Profile Review of literature

Page No.
7 17 28 30 34 57 61 62 77 78 86 96 98 100 102 103

Research Methodology Data analysis and Interpretation Observation and Finding Limitation Suggestion Conclusion Bibliography

OBJECTIVE
The primary objective is:
Checking the awareness level of online share trading. Evaluation of preferred investments in various mode and industry.

To collect the real time information about preference level of customers using Demat account and their inclination towards various other brokerage
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firms e.g. India bulls, Angel broking, India infoline, Religare, Alan- kit, Unicon.

To expand the market penetration of Sharekhan ltd.

To provide pricing strategy of competitors to fight cut throat competition. Study of influencing factors affecting the purchase decision. Analyzing the preferred broking house. Checking the satisfaction level of the customers towards preferred broking house.

The secondary objective is:

To make clients and let them know about the different services offered by the SHAREKHAN. To understand the problem faced by customers and finding way to solve the queries.

Company Profile

Sharekhan Ltd. is one of the leading retail stock broking house of SSKI Group which is running successfully since 1922 in the country. It is the retail broking arm of the Mumbai-based SSKI Group, which has over eight decades of experience in the stock broking business. Sharekhan offers its customers a wide range of equity related services including trade execution on BSE, NSE, Derivatives, depository services, online trading, investment advice etc. The firms online trading and investment site - www.sharekhan.com was launched on Feb 8, 2000. The site gives access to superior content and transaction facility to retail customers across the country. Known for its jargon-free, investor friendly language and high quality research, the site has a registered base of over one lakh customers. The content-rich and research oriented portal has stood out among its contemporaries because of its steadfast dedication to offering customers best-of-breed technology and superior market information. The objective has been to let customers make informed decisions and to simplify the process of investing in stocks. On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable application that emulates the broker terminals along with host of other information relevant to the Day Traders. This was for the first time that a netbased trading station of this caliber was offered to the traders. In the last six months Speed Trade has become a de facto standard for the Day Trading community over the net. Sharekhans ground network includes over 331 centers in 137 cities in India which provide a host of trading related services. Sharekhan has always believed in investing in technology to build its business. The company has used some of the best-known names in the IT industry, like Sun Microsystems, Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette, Verisign Financial Technologies India Ltd, Spider Software Pvt Ltd. To build its trading engine and content.
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The Morakhiya family holds a majority stake in the company. HSBC, Intel & Carlyle are the other investors. With a legacy of more than 80 years in the stock markets, the SSKI group ventured into institutional broking and corporate finance 18 years ago. Presently SSKI is one of the leading players in institutional broking and corporate finance activities. SSKI holds a sizeable portion of the market in each of these segments. SSKIs institutional broking arm accounts for 7% of the market for Foreign Institutional portfolio investment and 5% of all Domestic Institutional portfolio investment in the country. It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional Investors generate about 65% of the organizations revenue, with a daily turnover of over US$ 2 million. The Corporate Finance section has a list of very prestigious clients and has many firsts to its credit, in terms of the size of deal, sector tapped etc. The group has placed over US$ 1 billion in private equity deals. Some of the clients include BPL Cellular Holding, Gujarat Pipavav, Essar, Hutchison, Planetasia, and Shoppers Stop.

PROFILE OF THE COMPANY :

Name of the company Year of Establishment Headquarter : Sharekhan ltd. : 1925 : ShareKhan SSKI A-206 Phoenix House Phoenix Mills Compound Lower Parel Mumbai - Maharashtra, INDIA- 400013 : Service Provider : Depository Services, Online Services and Technical Research. : Over 3500 : www.sharekhan.com : Your Guide to The Financial Jungle.

Nature of Business Services Number of Employees Website Slogan

ACHIEVEMENTS OF SHAREKHAN:
Rated among the top 20 wired companies along with Reliance, HUJl, Infosys, etc by Business Today, January 2004 edition.
Awarded

Top Domestic Brokerage House four times by Euro money and Asia money. of online trading in India amongst the top 3 online trading websites from India. Most preferred financial destination amongst online broking customers.

Pioneers

Winners of Best Financial Website award.

Indias

most preferred brokers within 5 years. Awaaz customers Award 2005.

Future Plans:
2,00,000 plus retail customers being serviced through centralized call centers/ web solutions. Branches / Semi branches servicing affluent / aggressive traders through high skill financial advisor. 250 independent investment managers/ franchisee servicing 50,000 highly valued clients. New initiatives Portfolio management Services and commodities trading. Vision : To be the best retail brokering Brand in the retail business of stock market.

Mission :
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To educate and empower the individual investor to make better investment decisions through quality advice and superior service.

Sharekhan is infact Among the top 3 branded retail service providers No. 1 player in online business Largest network of branded broking outlets in the country serving more than 7,00,000 clients.

Get everything you need at a Sharekhan outlet!

All you have to do is walk into any of our 640 share shops across 280 cities in India to get a host of trading related services - our friendly customer service staff will also help you with any accouts related queries you may have.

A Sharekhan outlet offers the following services:

Online BSE and NSE executions (through BOLT & NEAT terminals) Free access to investment advice from Sharekhan's Research team Sharekhan ValueLine (a monthly publication with reviews of recommendations, stocks to watch out for etc) Daily research reports and market review (High Noon & Eagle Eye) Pre-market Report (Morning Cuppa) Daily trading calls based on Technical Analysis

Cool trading products (Daring Derivatives and Market Strategy) Personalised Advice Live Market Information Depository Services: Demat & Remat Transactions Derivatives Trading (Futures and Options) Commodities Trading IPOs & Mutual Funds Distribution Internet-based Online Trading: SpeedTrade

REASON TO CHOOSE SHAREKHAN LIMITED Experience : SSKI has more than eight decades of trust and credibility in the Indian stock market. In the Asia Money broker's poll held recently, SSKI won the 'India's Best Broking House for 2004 ' award. Ever since it launched Sharekhan as its retail broking division in February 2000, it has been providing institutionallevel research and broking services to individual investors. Technology : With its online trading account one can buy and sell shares in an instant from any PC with an internet connection. One can get access to its powerful online trading tools that will help him take complete control over his investment in shares. Accessibility : Sharekhan provides ADVICE, EDUCATION, TOOLS AND EXECUTION services for investors. These services are accessible through its centers across the country over the internet (through the website www.sharekhan.com) as well as over the Voice Tool. Knowledge : In a business where the right information at the right time can translate into direct profits, one can get access to a wide range of information on Sharekhan limiteds content-rich portal. One can also get a useful set of knowledge-based tools that will empower him to take informed decisions.
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Convenience : One can call its Dial-N-Trade number to get investment advice and execute his transactions. Sharekhan ltd. have a dedicated call-centre to provide this service via a Toll Free Number 1800-22-7500 & 1800-22-7050 from anywhere in India. Customer Service : Sharekhan limiteds customer service team will assist one for any help that one may require relating to transactions, billing, demat and other queries. Its customer service can be contacted via a toll-free number, email or live chat on www.sharekhan.com. Investment Advice : Sharekhan has dedicated research teams of more than 30 people for fundamental and technical researches. Its analysts constantly track the pulse of the market and provide timely investment advice to its clients in the form of daily research emails, online chat, printed reports and SMS on their mobile phone.

SSKI Group Companies SSKI Investor Services Ltd (Share khan) S.S. Kantilal Ishwarlal Securities SSKI Corporate Finance I dream Productions Palm spring estates Pvt Ltd. Fin flow Investment Pvt Ltd. I dream Production UK Pvt Ltd. Share khan Commodities Pvt Ltd.
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 Archfund Properties Pvt Ltd.

SERVICES:
Always wanted help on what the stock market is all about? Been wondering about how all this works? Well, you don't need to fret any more - the Sharekhan FirstStep is a brand new program designed especially for those who are new to investing in shares. All you have to do is open a Sharekhan FirstStep account and we'll guide you through the investing process.

SWOT ANALYSIS
Strengths:
It is a pioneer in online trading with a turn over of Rs.400crores and more than 800 peoples working in the organization. SSKI the parent company of Share Khan has more than eight decades of trust and credibility in the Indian stock market. In the Asian Money Brokers poll SSKI won the Indias best broking house for 2004 award.

Share Khan provides multi-channel access to all its customers through a strong online presence with www.sharekhan.com, 250 share shops in 130 cities and a call-center based Dial-n-Trade facility

Share Khan has dedicated research teams for fundamental and technical research. Which constantly track the pulse of the market and provide timely investment advice free of cost to its clients which has a strike rate of 70-80%.
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Weakness:
Localized presence due to insufficient investments for country wide expansion. Lack of awareness among customers because of non-aggressive promotional strategies (print media, newspapers, etc). Lesser emphasis on customer retention.

Focuses more on HNIs than retail investors which results in meager market-share as compared to close competitors.

Opportunities:
With the booming capital market it can successfully launch new services and raise its clients base. It can easily tap the retail investors with small saving through promotional channels like print media, electronic media, etc.

As interest on fixed deposits with post office and banks are all time low, more and more small investors are entering into stock market.

Abolition of long term capital gain tax on shares and reduction in short term capital gain is making stock market as hot destination for investment among small investors.
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 Increasing usage of internet through broadband connectivity may boost a whole new breed of investors for trading in securities.

Threats:
Aggressive promotional strategies by close competitors may hamper Share Khans acceptance by new clients. Lack of sufficient branch-offices for speedy delivery of services. Other players are providing margin funds to investors on easy terms where as there is no such facility in share khan. More and more players are venturing into this domain which can further reduce the earnings of Share Khan.

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TYPES OF ACCOUNT IN SHAREKHAN LIMITED :

Sharekhan offers two types of trading account for its clients :
Classic Account (which include a feature known as Fast Trade Advanced Classic Account for the online users) and Trade Tiger Account j. Live market debts.

CHARGE STRUCTURE :
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Fee structure for General Individual:

Charges
Account Opening Brokerage

Classic Account
Nil Intra day 0.10% Delivery 0.50%

Trade Tiger Account

Nil Intra day 0.10% Delivery 0.50%

BROKARAGE:

It is the charge taken by the guiding company for helping you in buying and selling your shares. There are different charges for Intraday and Delivery.

INTRADAY:

The day to day buying and selling or daily transactions are called as Intraday. You have to buy or sell the shares within the day only.

DELIVERY:

It is the three day transaction. The day you buy the share and the next two days after that day is called as Delivery. It includes thre days. If you are buying any share then you have to sell it within three days including the buying day.

T+2 = Today + 2 days Depository Charges:

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Account Opening Charges Annual Maintenance Charges

Nil 1st Year Nil 2nd Year 415/-

PREPAID ACCOUNT:
There are three types of Prepaid account are provided to the customers accordingly they make transactions more and more. All Prepaid accounts are valid for One year only. Scheme of Prepaid Brokerage :

Prepaid Brokerage (p.a)

2000/-

Cash

Futures and Options Futures Options

2% or Rs.90, whichever is higher 1.5% or Rs.75, whichever is higher 1% or Rs.50, whichever is higher

6000/18000/-

Intra-day 0.07% (Single Side) Delivery 0.40% Intra-day 0.05% Delivery 0.25% Intra-day 0.04% Delivery 0.20%

0.07

0.05 0.04

EXPOSURE:

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Sharekhan also helps their customers by providing them a Four time Exposure. Example :- If a customer invests Rs. 20000, then he will get a exposure of 4 times of Rs. 20000 that means Rs. 20000 * 4 = Rs. 100000.

But only for Five days, within 5 days the customer have to pay back the amount otherwisw they will sell your shares. But yes, they will sell the loss amking shares first. If you make any frod , then also you may face the sane problem.

But Exposure always helps the customer to invest more and more in profit making scripts. It is like an Overdraft which you have to return within 5 days.

HOW TO OPEN AN ACCOUNT WITH SHARE KHAN LIMITED ?

For online trading with Sharekhan Ltd., investor has to open an account. Following are the ways to open an account with Sharekhan Ltd.: One need to call them at phone number provided below and asks that he want to open an account with them. a. One can call on the Toll Free Number: 1-800-22-7500 to speak to a Customer Service executive b. Or If one stays in Mumbai, he can call on 022-66621111 One can visit any one of Sharekhan Limiteds nearest branches. Sharekhan has a huge network all over India (640 centers in 280 cities). One can also log on to http://sharekhan.com/Locateus.aspx link to find out the nearest branch. One can send them an email at info@sharekhan.com to know about their products and services. One can also visit the site www.sharekhan.com and click on the option
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Open an Account to fill a small query form which will ask the individual to give details regarding his name, city he lives in, his email address, phone number, pin code of the city, his nearest Sharekhan Ltd. shop and his preferences regarding the type of account he wants. These information are compiled in the headquarter of the company that is in Mumbai from where it is distributed through out the countrys branches in the form of leads on the basis of cities and nearest share shops. After that the executives of the respective branches contact the prospective clients over phone or through email and give them information regarding the various types of accounts and the documents they need to open an account and then fix appointment with the prospective clients to give them demonstration and making them undergo the formalities to open the account. After that the forms that has collected from the clients, is scrutinized in the branch and then it is sent to Mumbai for further processing where after a few days the clients account are generated and activated. After the accounts are activated, a Welcome Kit is dispatched from Mumbai to the clients address mentioned in the documents provided by them. As soon as the clients receive the Welcome Kit, which contains the clients Trading ID and Trading Password, they can start trading and investing in shares. Apart from two passport size photographs, one needs to provide with the following documents in order to open an account with Sharekhan Limited.:

Photocopy of the clients PAN Card which should be duly attached Photo copy of any of the following documents duly attached which will serve as correspondence address proof:

a. Passport (valid) b. Voters ID Card c. Ration Card d. Driving License (valid) e. Electricity Bill (should be latest and should be in the name of the client)

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f.

Telephone Bill (should be latest and should be in the name of the client) Flat Maintenance Bill (should be latest and should be in the name of the client) Insurance Policy (should be latest and should be in the name of the client)

g. h.

i. Lease or Rent Agreement. j. Saving Bank Statement** (should be latest) Two cheques drawn in favour of Sharkhan Limited, one for the Account Opening Fees and the other for the Margin Money (the minimum margin money is Rs. 5000). ** A cancelled cheque should be given by the client if he provides Saving Bank Statement as a proof for correspondence address. NOTE: Only Saving Bank Account cheques are accepted for the purpose of Opening an account. Generally the process of opening an account follows the following steps:
LEAD MANAGEMENT SYSTEM (LMS) / REFERENCES

CONTACT THE PERSON OVER PHONE OR THROUGH EMAIL

FIXING AN APPOINTMENT WITH THE PERSON

YES

GIVING DEMONSTRATION

NO

DOCUMENTATION
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FILLING UP THE FORM

SUBMISSION OF THE FORM

LOGIN OF THE FORM

SENDING ACCOUNT OPENING KIT TO THE CLIENT

TRADING

REVIEW OF LITERATURE

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Overview of Demat Account :

Demat account allows you to buy, sell and transact shares without the endless paperwork and delays. It is also safe, secure and convenient. In India, a demat account, the abbreviation for dematerialized account, is a type of banking account which dematerializes paper-based physical stock shares. The dematerialized account is used to avoid holding physical shares: the shares are bought and sold through a stock broker. This account is popular in India. The Securities and Exchange Board of India (SEBI) mandates a demat account for share trading above 500 shares. As of April 2006, it became mandatory that any person holding a demat account should possess a Permanent Account Number (PAN), and the deadline for submission of PAN details to the depository lapsed on January 2007.

Is a demat account a must?

Now a day, practically all trades have to be settled in dematerialized form. Although the market regulator, the Securities and Exchange Board of India (SEBI), has allowed trades of up to 500 shares to be settled in physical form, nobody wants physical shares any more. So a demat account is a must for trading and investing.

Why demat?
The demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments. It also helps you avoid bad deliveries caused by signature mismatch, postal delays and loss of certificates in transit. Further, it eliminates risks associated with forgery, counterfeiting and loss due to fire, theft or mutilation. Demat account
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holders can also avoid stamp duty (as against 0.5 per cent payable on physical shares), avoid filling up of transfer deeds, and obtain quick receipt of such benefits as stock splits and bonuses.

What is dematerialization?
Dematerialization is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form and credited into the investors account with his/her DP.

Why DEMAT a/c likes a BANK a/c?

Just as you have to open an a/c with a bank if you want to save your money, make cheque payments etc, you need to open a demat a/c if you want to buy or sell stocks. So it just like a bank a/c where actual money replaced by shares. Example : lets say your portfolio has 100 of SATYAM, 200 of IBM and 120 of TCS shares. All these will show in youre a/c. so you dont have to possess any

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physical certificate that you own these shares. They all are held electronically in youre a/c.

Steps involved in opening a demat account :

First an investor has to approach a DP and fill up an account opening form. The account opening form must be supported by copies of any one of the approved documents to serve as proof of identity (POI) and proof of address (POA) as specified by SEBI. Besides, production of PAN card in original at the time of opening of account has been made mandatory effective from April 01, 2006. All applicants should carry original documents for verification by an authorized official of the depository participant, under his signature.

Further, the investor has to sign an agreement with DP in a depository prescribed standard format, which details rights and duties of investor and DP. DP should provide the investor with a copy of the agreement and schedule of charges for their future reference. The DP will open the account in the system and give an account number, which is also called BO ID (Beneficiary Owner Identification number). The DP may revise the charges by giving 30 days notice in advance. SEBI has rationalized the cost structure for dematerialization by removing account opening charges, transaction charges for credit of securities, and custody charges vide circular dated January 28, 2005.

Further, SEBI has vide circular dated November 09, 2005 advised that with effect from January 09, 2006, no charges shall be levied by a depository on DP and consequently, by a DP on a Beneficiary Owner (BO) when a BO transfers all the securities lying in his account to another branch of the same DP or to another DP of the same depository or another depository, provided the BO Account/s at transferee DP and at transferor DP are one and the same, i.e. identical in all respects.

In case the BO Account at transferor DP is a joint account, the BO Account at transferee DP should also be a joint account in the same sequence of ownership.
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Rights:
1. You can open more than one depository account in the same name with single DP/ multiple DPs.

2. No minimum balance is required to be maintained in a depository account.

3. You can give a onetime standing instruction to your DP to receive all the credits coming to your depository account automatically.

DEMAT Benefits?

A safe and convenient way to hold securities. immediate transfer of securities. No stamp duty on transfer of securities(0.5 % on physical shares). Elimination of risks associated with physical certificates such as bad delivery, fake securities , delays , theft etc. Reduction in paper work. Reduction in transaction cost. No odd lot problem , even one share can be sold. Nomination facility. Holding investment in equity and debt instruments in a single account.etc.

DEMAT Conversion :24

1.

Surrender the certificates of physical shares for dematerialization to your depository participants. Depository participant intimates depository of the request through the system. Depository participant submit the certificates to the registrar to the issuer company. Registrar confirms the dematerialization request from depository. After dematerializing the certificates, registrar updates accounts and informs depository of the completion of dematerialization. Depository updates its accounts and informs the depository participant. Depository participant updates demat a/c of the investor.

2.

3.

4. 5.

6. 7.

What is a Depository?
A depository is an organisation which holds securities of investors in electronic form at the request of the investors through a registered Depository Participant. It also provides services related to transactions in securities.

SEBI registered depositorys :NSDL :- National securities depository limited CDSL :- Central depository services limited Minimum net worth required for a depository is 100 crores

NSDL:
Although India had a vibrant capital market, which is more than a century old, the paper-based settlement of trades caused substantial problems like bad delivery and delayed transfer of title till recently. The enactment of Depositories Act in August 1996 paved the way for establishment of NSDL, the first depository in
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India. This depository promoted by institutions of national stature responsible for economic development of the country has since established a national infrastructure of international standard that handles most of the trading and settlement in dematerialized form in Indian capital market. Using innovative and flexible technology systems, NSDL works to support the investors and brokers in the capital market of the country. NSDL aims at ensuring the safety and soundness of Indian marketplaces by developing settlement solutions that increase efficiency, minimize risk and reduce costs. At NSDL, we play a quiet but central role in developing products and services that will continue to nurture the growing needs of the financial services industry. In the depository system, securities are held in depository accounts, which is more or less similar to holding funds in bank accounts. Transfer of ownership of securities is done through simple account transfers. This method does away with all the risks and hassles normally associated with paperwork. Consequently, the cost of transacting in a depository environment is considerably lower as compared to transacting in certificates.

DEPOSITORY PARTICIPANTS:
A Depository Participant (DP) is described as an agent of the depository. They are the intermediaries between the depository and the investors. The relationship between the DPs and the depository is governed by an agreement made between the two under the Depositories Act. In a strictly legal sense, a DP is an entity that is registered as such with SEBI under the provisions of the SEBI Act. As per the provisions of this Act, a DP can offer depository-related services only after obtaining a certificate of registration from SEBI. SEBI (D&P) Regulations, 1996 prescribe a minimum net worth of Rs.50 lakh for stockbrokers, R&T agents and non-banking finance companies (NBFC), for granting them a certificate of registration to act as DPs. If a stockbroker seeks to act as a DP in more than one depository, he should comply with the specified net worth criterion separately for each such depository. No minimum net worth criterion has been prescribed for other categories of DPs. However, depositories can fix a higher net worth criterion for their DPs. NSDL requires a minimum net worth of Rs.100 lakh to be eligible to become a DP as against Rs.50 lakh prescribed by SEBI (D&P) Regulations.

Instruments :
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The changes in the regulatory framework of the capital market and fiscal policies have also resulted in newer kinds of financial instruments (securities) being introduced in the market. Also, a lot of financial innovation by companies who are now permitted to undertake treasury operations has resulted in newer kinds of instruments - all of which can be traded being introduced. The variations in all these instruments depend on the tenure, the nature of security, the interest rate, the collateral security offered and the trading features, etc Debentures Bonds Preference Share Equity Shares Government securities Capital Market Processes Initial Public Offering (IPO) Private Placement Preferential Offer/Rights Issue Private Placement

Benefits of Depository System:

In the depository system, the ownership and transfer of securities takes place by means of electronic book entries. At the outset, this system rids the capital market of the dangers related to handling of paper. NSDL provides numerous direct and indirect benefits, like:

Elimination of bad deliveries

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In the depository environment, once holdings of an investor are dematerialized, the question of bad delivery does not arise i.e. they cannot be held "under objection". In the physical environment, buyer was required to take the risk of transfer and face uncertainty of the quality of assets purchased. In a depository environment good money certainly begets good quality of assets.

Elimination of all risks associated with physical certificates

Dealing in physical securities have associated security risks of theft of stocks, mutilation of certificates, loss of certificates during movements through and from the registrars, thus exposing the investor to the cost of obtaining duplicate certificates and advertisements, etc. This problem does not arise in the depository environment.

No stamp duty

For transfer of any kind of securities in the depository. This waiver extends to equity shares, debt instruments and units of mutual funds.

Immediate transfer and registration of Securities

In the depository environment, once the securities are credited to the investors account on pay out, he becomes the legal owner of the securities. There is no further need to send it to the company's registrar for registration. Having purchased securities in the physical environment, the investor has to send it to the company's registrar so that the change of ownership can be registered. This process usually takes around three to four months and is rarely completed within the statutory framework of two months thus exposing the investor to opportunity cost of delay in transfer and to risk of loss in transit. To overcome this, the normally accepted practice is to hold the securities in street names i.e. not to register the change of ownership. However, if the investors miss a book closure the securities are not good for delivery and the investor would also stand to loose his corporate entitlements.
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 Faster settlement cycle

The exclusive demat segments follow rolling settlement cycle of T+2 i.e. the settlement of trades will be on the 2nd working day from the trade day. This will enable faster turnover of stock and more liquidity with the investor.

Faster disbursement of non-cash corporate benefits like rights, bonus, etc.

NSDL provides for direct credit of non-cash corporate entitlements to an investors account, thereby ensuring faster disbursement and avoiding risk of loss of certificates in transit.

Reduction in brokerage by many brokers for trading in dematerialized securities

Brokers provide this benefit to investors as dealing in dematerialized securities reduces their back office cost of handling paper and also eliminates the risk of being the introducing broker.

Reduction in handling of huge volumes of paper Periodic status reports to investors on their holdings and transactions, leading to better controls. Elimination of problems related to change of address of investor, transmission, etc
In case of change of address or transmission of demat shares, investors are saved from undergoing the entire change procedure with each company or registrar.
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Investors have to only inform their DP with all relevant documents and the required changes are effected in the database of all the companies, where the investor is a registered holder of securities.

Elimination of problems related to selling securities on behalf of a minor

A natural guardian is not required to take court approval for selling demat securities on behalf of a minor.

RESEARCH METHODOLOGY
INTRODUCTION
Research Methodology refers to search of knowledge .one can also define research methodology as a scientific and systematic search for required information on a specific topic. The word research methodology comes from the word advance learner s dictionary meaning of research as a careful investigation or inquiry especially through research for new facts in my branch of knowledge for example some author have define research methodology as systematized effort to gain new knowledge.

Methodology of the project starts with

In the first phase we are trained and they teach us different things about market. After that they conduct a mock viva, in this they ask about the real life problem faced by the customers.
30

 They provide leads and after that we make calls. Then after that we have to provide details of product and convince them. Then we have to visit them and get the formed filled from them. Maintaining dairy of clients and contacting them at regular basis. Get the knowledge of technical as well as fundamental methods. Observe the patterns of the scripts.

METHODS OF DATA COLLECTION

In the project work Primary data secondary data (both) sources of data has been used .

1. Primary data collection:

In dealing with real life problem it is often found that data at hand are inadequate, and hence, it becomes necessary to collect data that is appropriate. There are several ways of collecting the appropriate data which differ considerably in context of money costs, time and other resources at the disposal of the researcher. Primary data can be collected either through experiment or through survey. The data collection for this study was done in the following manner:
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Through personal interviews:A rigid procedure was followed and we were seeking answers to many preconceived questions through personal interviews.

Through questionnaire:Information to find out the investment potential and goal was found out through questionnaires.

Through Tele-Calling:Information was also taken through telephone calls.

2. Secondary sources of data:

In the secondary sources of data is used. (Internet , magazine ,books, journals) In research, secondary data is data collected and possibly processed by people other than the researcher in question. Common sources of secondary data for social science include censuses, large surveys, and organizational records. In sociology primary data is data you have collected yourself and secondary data is data you have gathered from primary sources to create new research. In terms of historical research, these two terms have different meanings. A primary source is a book or set of archival records. A secondary source is a summary of a book or set of records.

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DATA ANALYSIS AND INTERPRETATION

SHAREKHAN ICICIDIRECT .COM . COM NIL 750/-(waive off if trading is more than Rs. 1 lakh)

RELIGARE

HDFCSEC . COM

5PAISA . COM 420/-(fresher) And 250/(Traders)

INDIABUL LS

A/C OPENING CHARGE S

20550/-(20,000 750/as margin) (EXISTINGR ELATIONSH IP) OR 799/30 p.m. 500 p.a.

700/-

DEMAT A/C CHARGE S

FREE (1ST YEAR) AND 415/P.A. FROM 2ND YEAR ONWARDS

FREE FOR 1ST YEAR AND 300/P.A. FROM 2ND YEAR ONWARDS

250/-P.A.

NO AMC

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TYPE OF ACCOUN T

2(CLASSIC & TRADE TIGER)

Web based

5type(1.HMR GATEWAY A/C, HMR VALUE A/C, HMR PRIVILEGE A/C, HMR HIGHTRADE R A/C, HMR FREEWAY A/C) Both are Software 1. Keat Desktop 2. Keat Premium

Web based

2(TRADER TERMINAL, INVESTOR TERMINAL)

Web based

TRADING BOTH THROUG H WEBSITE OR SOFTWARE

WEBSITE

WEBSITE

BOTH

WEBSITE

SHAREKHAN .COM NSE/BSE/ DERIVANSE/BSE/ TIVES/ DERIVATIVES ARBITRAGE/ MUTUAL FUNDS

ICICIDIRECT HMRSTREET .COM .COM NSE/BSE/ MUTUAL FUNDS/ Derivatives NSE/ DERIVATIVE S/ MUTUAL FUNDS

HDFCSEC .COM NSE

5PAISA .COM NSE/ DERIVATIVE S/ ARBITRAGE ON DELIVERY/M UTUAL FUNDS 1000/commitment of brokerage

INDIA BULLS NSE/ DERIVATI VES

SOFTWARE CHARGE S

Nil

N.A.

500/- or 300 /-p.m. (NEGOTIABLE ON VOLUME)

N.A.

N.A.

34

DAIL-NTRADE

UNLIMITED

On 21st call Rs 20/per call(P.M.)

15/- TO 25/FROM 21ST CALL

RM NUMBER PROVIDED FOR TRADING

Local call charges

RM NUMBER PROVIDED FOR TRADING

DEMAT TRANSACTION CHARGES

NIL (THROUGH SHRAKHAN)

INCLUDING IN BROKERAGE

.04% OR RS. 25/- ON SELLING whichever is higher

.04% or Rs. 25 whichever is higher

0.05 % OR minimum of Rs. 20/- per instruction (ON SELLING)

RS. 17/PER TRANSAC TION (ON SELLING) HDFC BANK, ICICIBAN K, ABNAMRO BANK, STANCHA RT BANK, CITIBANK

TIE UP WITH BANKS

HDFCBANK, IDBIBANK, CITI BANK, UTIBANK, OBC, ICICI BANK, YES BANK, UNION BANK OF INDIA, CANARA BANK, INDUSIND BANK

ICICIBANK ONLY (COMPULSO RY)

HMR MAHINDRA BANK CITI BANK UTIBANK HDFCBANK (COMPULSIO N)

HDFCBAN K ONLY (COMPULS ORY)

HDFC Bank, ICICI Bank, UTI Bank, Citibank, Global Trust Bank or Centurion Bank

SHAREKHAN .COM

ICICIDIRECT .COM

HMR STREET. COM

HDFCSEC .COM

5PAISA .COM

INDIABUL LS

35

BUY TODAY SELL TOMORROW

YES

YES BUT ONLY ON 127 SCRIPS OF NSE

YES, UPTO 75% SHARES VALUE

NO

YES

YES

IPO ONLINE

YES

YES

YES

NO

YES

NO

SMS ALERTS RESEARCH REPORTS

100 P.M.

YES

100/- P.M.

NO

NO

NO

FREE

450 P.A.

FREE

FREE

FREE

PAID 100/P.M

MINIMU M MARGIN EXPOSURE MINIMU M MARGIN

4 TO 6.7 TIMES

4 TIMES

4 TO 6 TIMES 4 times

4 to 6 times(online) 10 times(Offline)

4 TIMES ONWARDS

Nil

5000/-

5000/-,1,00,00 0/-or 5,00,000/(according to account)

5000/-

5000/-

500 BLOCKED BY THE SYSTEM

Volume requirement BROKERAGE

Nil

Nil

Yes, according to product .06% (INTRADAY) .59% (DELIVERY)

Nil

Rs 1000/Commitment as brokerage .05% (INTRA-DAY) .25% (DELIV-ERY)

NIL

.1% (INTRADAY) .5% (DELIVERY)

.1%to.15% (INTRADAY) .4% to .85% (DELIVERY

.15% (INTRADAY) .5% (DELIV-

.1% (INTRADA Y) .5% (DELIVER

36

ERY) (excluding taxes)

Y)

Q1. In which of these Financial Instruments do you invest into?

Financial Instrument Mutual Fund Bond Online trading Derivative Percentage of respondent 75% 16% 7% 2%

37

Result of Preference of Investment

Interpretation: This shows that although the mutual funds market is on the rise yet, the most favored investment continues to be in the Share Market. So, with a more transparent system, investment in the Stock Market can definitely be increased.

Q2. Are you aware of online Share trading?

Aware of online share trading Yes No

Percentage of respondent 72% 28%

Result of awareness of online trading

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Interpretation: With the increase in cyber education, the awareness towards online share trading has increased by leaps and bounds. This awareness is expected to increase further with the increase in Internet education.

Q3. Heard about Sharekhan ltd.?

Awareness of Sharekhan ltd. Yes No

Percentage of respondent 70% 30%

39

Interpretation: This pie-chart shows that This brand image should be further leveraged by the company to increase its market share over its competitors.

Q4. Do you know about the facilities provided by Sharekhan ltd.?

Awareness of Sharekhan ltd. Services Yes No

Percentage of respondent 36% 64%

Awareness of Sharekhan ltd.Facilities

36%

yes 64% No

40

Interpretation: Although there is sufficiently high brand equity among the target audience yet, it is to be noted that the customers are not aware of the facilities provided by the company meaning thereby, that, the company should concentrate more towards promotional tools and increase its focus on product awareness rather than brand awareness.

Q.5 Which company provide a less BROKARAGE rate ?

Company Name Sharekhan ltd. HDFC ICICI

Percentage of respondent 22 11 17

41

INTERPRTETATION: 44% have respondent of Sharekhan ltd., 22% have respondent of HDFC, 34% have respondent of ICICI.

Q. 6 Which company provide you a large number of product and services?

Company Name Sharekhan ltd. HDFC ICICI

number of respondent 22 10 18
42

INTERPRETATION:44% have respondent of Sharekhan ltd., 20% have respondent of HDFC, 36% have respondent of ICICI.

Q. 7 How many of you satisfy with the level of current broker?

S t fa io le e a o gCu t m rsw h a is ct n v l m n s o e it cu n b k r rre t ro e

Yes - 92%

No- 8%

43

Interpretation: This pie chart accentuates the fact that Strategic marketing, today, has gone beyond only meeting Sales targets and generating profit volumes. It shows that all the competitors are striving hard not only to woo the customers but also to make them Brand loyal by generating customer satisfaction.

Q. 8 How many of do training:

A) Daily B) Monthly C) Weekly D) Yearly

Frequency of Trading

Daily - 9% Weekly - 27% Monthly -53% Yearly -11%

Interpretation:
44

In spite of the huge returns that the share market promises, we see that there is still a dearth of active traders and investors. This is because of the non transparent structure of the Indian share market and the skepticism of the target audience that is generated by the volatility of the stock market. It requires efficient bureaucratic intervention on the part of the Government.

Q. 9According to your perspective which investment gives you maximum return?

(1) Share market (2) Mutual funds (3) Purchasing insurance policy

share market mutual funds purchasing insurance policies

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Interpretation As of today people believe in secured investment with no risk & high return. So insurance policy are the best option for them as they give good return after a period of time .Share market has also come up in a big way though the risk factor is a bit too high despite good return.

Represent a pie chart

46

OBSERVATION
To study the sales and distribution management and improve the Customer Acquisition Process by analyzing the consumer behavior, response and mindset towards the product and services the company offers.

1. Preference of Investment:
Consumers want to invest 75% in Mutual funds, 16% in Bonds, 7% in online trading and 2% in Derivatives.

2. Awareness on Online Share Trading:

72% consumers are aware of online share trading and 28% consumers are not aware of online share trading.

3. Awareness of Sharekhan ltd.:

70% consumers are know about Sharekhan ltd. and 30% consumers are not know about Sharekhan ltd.

4. Awareness about facilities provided by Sharekhan ltd. :

47

36% consumers are aware about the facilities provided by Sharekhan ltd. and 64% consumers are not know about the facilities provided by Sharekhan ltd.

5. Provide a less BROKARAGE rate:

44% have respondent of Sharekhan ltd., 22% have respondent of HDFC, 34% have respondent of ICICI.

6. Provide a large no. of Products and services:

44% have respondent of Sharekhan ltd., 20% have respondent of HDFC, 36% have respondent of ICICI.

FINDINGS
According to the survey most of the customers of Sharekhan Ltd says that it is pocket friendly. Coming to faith 70% say Sharekhan Ltd is better than others stock brokers due to customers satisfaction. Main purposes of investments are returns & liquidity. Investors take risk as well as returns into their mind while making the investment. Businessmen are more interested in the stock market than the others. Commodity market is less preferred by the investors. People want to invest their money in the security market but they havent the proper knowledge. People are not aware of hedging in stock market.
People pay more emphasis on brokerage than service provided by brokerage 48

houses.

LIMITATION

Lack of awareness of capital market:

Since the area is not known before it takes lot of time in convincing people to start investing in shares primarily in IPOs.

Some people are comfortable with traditional system:

As people are doing trading from there respective brokers, they are quite comfortable to trade via physical form of paper.

Lack of Techno Savvy people and poor internet penetration: techno

Since most of the people are quite experienced and also they are not savvy. Also Internet penetration is poor in India.

49

Some respondents are unwilling to talk:

Some respondents either do not have time or willing does not respond, as they are quite annoyed with the phone call.

Inaccurate Leads:

Sometimes leads are provided which had error in it, which varies from only 5digit phone number to wrong phone number

Misleading concepts:

Some people think that as all the shares are in electronic form and they dont have any physical proof. Sometimes this leads to a great misconception of the entire process. The time constraint was one of the major problems. The study is limited to the different schemes available under the Demat account selected. The lack of information sources for the analysis part.

Geographical locations.

Extreme variability in MARKET.

50

SUGGESTIONS
1. MORE BRANCHES Need to open more branches to be a topper in market Because it has a low distribution network.

2. LESS TIME
They should try to make some arrangements to reduce account opening time by verifying documents at branch it selves. 3. LINK-BANK A/Cs Linked as many accounts as client wants to its online account. 4. NEW BANKS IN THE KITTY Need to tie up with major banks like SBI, Allahabad Bank, Bank of Baroda etc. 5.CUSTOMER SATISFACTION
51

The company should focus on the customer satisfaction not on just taking money from their pocket. 7.CONTROLLED BRANCHES The company would have to make some arrangements to control the branches and make standardized procedures for all of them for their better control and performance appraisal.

Commitment should be equalized for every person.

Provide the facility of free demonstrations for all.

Improvement in the opening of De-mat & contract notice procedure is required.

There should be a limited number of clients under the relationship manger. So that he can handle new as well as old customer properly.

Some promotional activities are required for the awareness of the customer.

People at young age should be encouraged to invest in stock market.

Seminars should be held for providing information to prospective and present customers.
52

CONCLUSION
On the basis of the study it is found that Sharekhan Ltd is better services provider than the other stockbrokers because of their timely research and personalized advice on what stocks to buy and sell. Sharekhan Ltd. provide the facility of Trade tiger as well as relationship manager facility for encouragement and protect the interest of the investors. It also provides the information through the internet and mobile alerts that what IPOs are coming in the market and it also provides its research on the future prospect of the IPO.

53

Study also concludes that people are not much aware of commodity market and while its going to be biggest market in India.

The company should also organize seminars and similar activities to enhance the knowledge of prospective and existing customers, so that they feel more comfortable while investing in the stock market.

BIBLIOGRAPHY
Websites:
www.Google.com www.bseindia.com www.nseindia.com 4. www.moneycontrol.com 5. www.sharekhan.com 6. www.icicidirect.com 7. www.5paisa.com 8. www.Indiabulls.com
1. 2. 3.

54

www.hdfcsecurities.com 10. WWW.KARVY.COM

9.

NEWSPAPERS:
1. ECONOMIC TIMES 2. TIMES OF INDIA 3. FINANCIAL EXPRESS

55