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Summer Training Project Report on

COMPARATIVE ANALYSIS OF INVESTMENT OPTIONS AVAILABLE IN THE MARKET AND CUSTOMER BUYING PREFERENCE
Project Report submitted by:

PRAKHAR SRIVASTAVA
2011MB34

PROJECT CONCLUDED AT:

HAZRAT GANJ BRANCH, LUCKNOW


Submitted in partial fulfillment for the Award of degree of Master of Business Administration

SUBMITTED BY: PRAKHAR SRIVASTAVA 2011MB34 MBA 3RD SEM

SUBMITTED TO:DR. PEEUSH RANJAN AGRAWAL (HEAD OF DEPARTMENT)

Academic Year 2012-2013

OBJECTIVES OF THE PROJECT


To understand all about different investment avenues available in India. To find out how the investors get information about the various financial instrument To find out how the investor wants to invest i.e. on his own or through a broker. To find out the saving habits of the different customers and the amount they invest in various financial instruments. In which type of financial instrument they like to invest. How long they prefer to keep their money invested. What is the return that they expect from the investment? What are the various factors that they consider before investing? To find out the risk profile of the investor. To give a recommendation to the investors that where they should invest. To give a suggestion to the company where its funds lack in the market & how it should be rectified. After all as a management trainee I will try to get some valuable knowledge from my seniors in the organization as well as from my faculty guide which will help me in the future. To evaluate the consumer attitude towards saving and decision making regarding investments.

LIMITATIONS OF THE STUDY


Total number of financial instrument in the market is so large that it needs a lot of resources to analyze them all. There are various companies providing these financial instruments to the public. Handling and analyzing such a varied and diversified data needs a lot of time and resources. As the project is based on secondary data, possibility of unauthorized information cannot be avoided. Reluctance of the people to provide complete information about them can affect the validity of responses. Due to time and cost constraint study will be conducted in only selected area of Lucknow. The lack of knowledge in customers about the financial instruments can be a major limitation. The information can be biased due to use of questionnaires.

INTRODUCTION
TO THE INDUSTRY

The Stock Exchange, Mumbai, popularly known as "BSE" was established in 1875 as "The Native Share and Stock Brokers Association". It is the oldest one in Asia, even older than the Tokyo Stock Exchange, which was established in 1878 It is the first Stock Exchange in the Country to have obtained permanent recognition in 1956 from the Govt. of India under the Securities Contracts (Regulation) Act, 1956.

NSE (NATIONAL STOCK EXCHANGE)


NSE was incorporated in 1992 and was given recognition as a stock exchange in April 1993. It started operations in June 1994, with trading on the Wholesale Debt Market Segment. It has been playing a leading role as a change agent in transforming the Indian Capital Markets to its present form. The Indian Capital Markets are a far cry from what they used to be a decade ago in terms of market practices, infrastructure, technology, risk management, clearing and settlement and investor service.

INTRODUCTION TO

KARVY, is a premier integrated financial services provider, and ranked among the top five in the country in all its business segments, services over 16 million individual investors in various capacities, and provides investor services to over 300 corporate, comprising the who is who of Corporate India. The birth of Karvy was on a modest scale in 1981. It began with the vision and enterprise of a small group of practicing Chartered Accountants who founded the flagship company. KARVY with the help of highly qualified manpower, cuttingedge technology, comprehensive infrastructure and total customer-focus has secured for the position of an emerging financial services giant enjoying the confidence and support of an enviable clientele across diverse fields in the financial world.

MILESTONES

ACHIEVEMENTS
Among the top 5 stock brokers in India (4% of NSE volumes) India's No. 1 Registrar & Securities Transfer Agents Among the top 3 Depository Participants Largest Network of Branches & Business Associates ISO 9002 certified operations by DNV Among top 10 Investment bankers Largest Distributor of Financial Products Adjudged as one of the top 50 IT uses in India by MIS Asia Fully Fledged IT driven operations

MAJOR AREAS OF OPERATIONS


Karvy Consultants Limited Karvy Stock Broking Limited Karvy Investors Services Limited Karvy Computershare Pvt. Limited Karvy Global Services Limited Karvy Comtrade Limited Karvy Insurance Broking Private Limited

INTRODUCTION TO THE TOPIC

TYPES OF INVESTMENT OPTIONS AVAILABLE IN THE MARKET


Mutual Funds Bond/IPOs Insurance Fixed Deposits Govt. Securities Real Estate Commodities

RESEARCH

METHODOLOGY

RESEARCH OBJECTIVE

To analyze the COMPARATIVE ANALYSIS OF

INVESTMENT OPTIONS AVAILABLE IN THE MARKET IN ACCORDANCE WITH THE CUSTOMER BUYING PREFERENCE and their potential market among the
people of Lucknow City.

SAMPLING DESIGN
Sampling Area Sample Population Sample Size : : : Lucknow city above 15,000 100

METHODS
The method used in the research (survey) is of probability type as we are unaware about the results. It can be either of the side. It is area of Lucknow city under which we have to conduct the research. The research is based on Convenience Method s. and the take the sample from to various stock broking company.

RESEARCH DESIGN
Research Data Source Research Method Research Technique Type of Questionnaire Type of Questions : : : : : : : Descriptive & Objective Primary data Survey Method Questionnaire Structured Closed & Open ended Questions 15

No of Questions

DATA

ANALYSIS

Ques 1. Do you know about the following Financial Instrument?


Response Rate 100 80 60 40 20 0 92 76 76 54 54 62 56

Series1

Series1

Mutual Funds 92

Bonds/IPO' Insurance s 76 76

Fixed Deposits 54

Govt. Commoditi Real Estate Securities es 54 62 56

Ques 2. How do you get information regarding these Financial Instruments?


Response Rate
60 40 20 0 Advertisement Company Sales force Series1 Friends / Relatives Magazines /Newspaper Magazines /Newspaper 50

Advertisement Series1 52

Company Sales force 44

Friends / Relatives 36

Ques 3. Ratings of Investment options as per the customer's preference


Scale of preference 3 2 1 0 Series1

Mutual Funds Series1 3

Bonds 2

Govt. Insurance Securities 2 3

FD 2

Real Estate 1

IPO 2

Commodi ties 1

Ques 4. Do you invest in Financial Instruments?

100 Response Rate 80 60 40 20 0

Series1
Yes No

Series1

Yes 87

No 13

Ques 5. Where do you invest your savings?


Response Rate
80 60 40 20 0 Series1

Fixed Deposits Series1 74

Equity 26

Mutual Funds 36

Post Office 40

Commodi Derivativ Insurance ties es 46 48 16

Others 26

Ques 6. What are the factors which you consider while investing in any Financial Instrument?
Response Rate 80 60 40 20 0 Series1

Return (capital Tax saving appreciation) Series1 70 52

Liquidity 28

Regular income flow 16

Safety 44

Risk 26

Response Rate

Ques 7. On what basis you will invest in any particular Financial Instrument?
50 40 30 20 10 0 Series1

Past Performance Series1 38

Portfolio 50

Fundamental/T echnical Fund Manager Analysis 10 40

Market Sentiment 44

Ques 8. How will you invest your money in any Financial Instrument?
60 50 40 30 20 10 0 Yourself Sub broker / Agents Through banks Yourself 56 Sub broker / Agents 60 Through banks 30 Series1

Response Rate

Series1

Ques 9. How long you prefer to keep your money in any Financial Instrument?
60

Response Rate

40 20
0

Less than 6 months

6 months to 1 year

Series1 1 year to 3 year

More than 3 years


More than 3 years 10

Less than 6 months 6 months to 1 year Series1 12 46

1 year to 3 year 32

Ques 10. If you select a broker or agent then which broker company would you select?
60 50 40 30 20 10 0 Response Rate

Series1

Share Khan Series1 20

Kotak HDFC ICICI Motilal Indiabull Angel Just Karvy Securitie Marwadi Religare Securitie Direct Oswal s Broking Trade s s 60 20 14 50 20 20 28 14 8 10

Others 0

Ques 11. What influences you to invest your amount?


100 80 60 40 20 0 Series1 Response Rate

Independently Series1 10

Broker/Agent 84

News Papers 34

Internet 2

Tax Consultant 14

Ques 12. Which of these would you like to be trading in?


70 60 50 40 30 20 10 0 Equity Derivatives Commodities Equity 62 Derivatives 68 Commodities 10 Series1

Response Rate

Series1

Ques 13. Which are the constraints that you might consider while investing?
Response Rate
80 60 40 20 0 Risk Taking ability Fund Facility Return on Investment

Series1 Time Duration


Company Investment position Time Duration 18 Company Investment position 10

Risk Taking ability

Fund Facility 62

Return on Investment 30

Series1

30

Ques 14. How much return you expect from any Financial Instrument?

Response Rate

60 40 20 0 10% to 20% 20% to 30% Series1 30% to 50% More than 50%

Series1

10% to 20% 10

20% to 30% 22

30% to 50% 50

More than 50% 18

Ques 15. Will you invest your money for saving the Tax in any Financial Instrument?

Response Rate

80 60 40 20 0 Yes No Series1

Series1

Yes 80

No 20

FINDINGS
This is probably the most important question of the questionnaire; the result of this question is that most of the people think of (RISK TAKING ABILITY) because it is the most crucial constraint. Next comes is the facilities given to them under the funds and also the ROI (return on investment). There are other factors also like time duration of their investment and Company reputation in the market.

RECOMMENDATIONS
Mutual Funds can also be offered as they have high risk profile. Company should take initiative to get demat account of these customers. The age group of 41-50 years, investors are from the 15,00020,000 Rs disposable income group. Investor in this group are invested in Insurance sector, the primary focus of these investors are retirement and time horizon is likely to be 6-9 years. This is also good potential group for the retirement plan in ULIPs. Fixed deposits can be a good option for them. In the survey there were lot of people who were in the age group of above 60. For this group of people the company can target Fixed deposits which gives continues return like monthly interests so that they can keep on getting returns.

SUGGESTIONS
Return on Investment is must but the risk also should be minimizing at the same time. No one loves to lose his hard earned money therefore it should be invested in safer place. Services are must for them and therefore the company must also concentrate on this aspect. Good advisory services, secrecy of the data given to the company as well as every people must treated as they all are equal i.e. no biasness. Charges of the services provided to them should be reasonable and viable.

CONCLUSIONS
Karvy has enough number of branches all over India and therefore it is a great advantage for the company and the company also planning to expand its network. Karvy also provides the facility of trading in almost all the exchanges and therefore whatever the customer demands the company has in its package. The company also has a very good research team at its Head Office and this is meant for the better working as well as for the customer of Karvy only. The company also has the advantage of the existing customers where their level of faith and their view about the company to the outside world will be a helping hand for the company to expand its business.

REFERENCES
(n.d.). Business Today. (n.d.). The Economic Times. (n.d.). The Mint. (n.d.). Karvy Finapolis. Aswathapa, K. (n.d.). 3rd edition "Human Resource and Personnel Management". New Delhi: Tata McGraw-Hill Publishing Company Ltd. Cooper. (n.d.). 8th Edition "Business Research Methods". New Delhi: Tata McGraw-Hill Publishing Company Ltd. Kotler, P. (n.d.). The Millenium Edition "Marketing Management". New Delhi: Prentice Hall of India Pvt. Ltd. www.karvy/about.asp. (n.d.). www.bseindia/about.asp (n.d.). www.nseindia.com (n.d.). www.mcx.com (n.d.). www.ncdex.com (n.d.). www.karvy.com (n.d.). www.icicidirect.com (n.d.). www.mutualfundsindia.com (n.d.). www.nseindia.com (n.d.). www.bseindia.com (n.d.). www.scribd.com (n.d.). www.mcx.com (n.d.). www.equitymaster.com (n.d.).

THANK YOU!