Professional Documents
Culture Documents
ON
[ SH ARE K H AN LI M I TED]
IS SUBMITTED BY
TO
INTERNSHIP PROJECT
(2007-2009)
1
PREFACE
2
ACKNOWLEDGEMENT
3
CONTENTS
1. Introduction
Stock market
History
Trading
Market participants
Importance of stock market
The behaviour of the stock market
Bombay stock exchange
BSE indices
National stock exchange
Derivatives
Financial system
Flow of fund
Main function of financial system
Financial market
Capital market
Stock exchange
Relation of the stock market with financial system
The stock market, individual investors, and financial risk
Function of stock exchange
Service of stock exchange
Kotak securities
Share khan
India infoline
Bonanza
Reliance money
Karvy
Religare securities
India bulls
Anand rathi
3. Research objective
Statement of problem
Objective of the research project
Problem definition
Justification of study
Objective of study
Research design
4
Source of data
Limitation of study
5. Conclusions and suggestions
6. Questionnaire
5
INTRODUCTION
STOCK MARKET
6
notional values, and cannot be directly compared to a stock or a
fixed income security, which traditionally refers to an actual
The stocks are listed and traded on stock exchanges which are
entities a corporation or mutual organization specialized in the
business of bringing buyers and sellers of stocks and securities
together. The stock market in the United States includes the
trading of all securities listed on the NYSE, the NASDAQ, the
Amex, as well as on the many regional exchanges, e.g. OTCBB
and Pink Sheets. European examples of stock exchanges include
the London Stock Exchange, the Deutsche Borse and the Paris
Bourse.
HISTORY
TRADING
Now that computers have eliminated the need for trading floors
like the Big Board's, the balance of power in equity markets is
shifting. By bringing more orders in-house, where clients can
move big blocks of stock anonymously, brokers pay the
exchanges less in fees and capture a bigger share of the $11
billion a year that institutional investors pay in trading
commissions
MARKET PARTICIPANTS
9
IMPORTANCE OF STOCK MARKET
History has shown that the price of shares and other assets is an
important part of the dynamics of economic activity, and can
influence or be an indicator of social mood. Rising share prices,
for instance, tend to be associated with increased business
investment and vice versa. Share prices also affect the wealth of
households and their consumption. Therefore, central banks tend
to keep an eye on the control and behavior of the stock market
and, in general, on the smooth operation of financial system
functions. Financial stability is the raison d'être of central
banks.
10
THE BEHAVIOR OF THE STOCK MARKET
11
period of good returns also boosts the investor's self-
confidence, reducing his (psychological) risk threshold.[4].
IRRATIONAL BEHAVIOR
T h e B o m b a y S t o c k E x c h a n g e L i m i t e d ( H i n d i : म ुं ब ई श े य र ब ा ज ा र
Mumbaī Śeyar Bājār) (formerly, The Stock Exchange, Mumbai;
popularly called The Bombay Stock Exchange, or BSE) is the
oldest stock exchange in Asia. It is also the biggest stock
exchange in the world in terms of listed companies with 6,000
listed companies as of August 2007.[1] It is located at Dalal
Street, Mumbai, India. On 31 December 2007, the equity market
capitalization of the companies listed on the BSE was US$ 1.79
trillion, making it the largest stock exchange in South Asia and
the tenth largest in the world.[2]
BSE INDICES
Apart from BSE SENSEX, which is the most popular stock index
in India, BSE uses other stock indices as well:
• BSE 500
• BSE 100
• BSE 200
• BSE PSU
• BSE MIDCAP
• BSE SMLCAP
• BSE BANKEX
• BSE Teck
• BSE Auto
• BSE Pharma
• BSE Fast Moving Consumer Goods (FMCG)
• BSE Consumer Durables
13
BSE BROADCAST
1000, July 25, 1990 On July 25, 1990, the Sensex touched the
magical four-digit figure for the first time and closed at 1,001
in the wake of a good monsoon season and excellent corporate
results.
14
2000, January 15, 1992 On January 15, 1992, the Sensex crossed
the 2,000-mark and closed at 2,020 followed by the liberal
economic policy initiatives undertaken by the then finance
minister and current Prime Minister Dr Manmohan Singh.
4000, March 30, 1992 On March 30, 1992, the Sensex crossed
the 4,000-mark and closed at 4,091 on the expectations of a
liberal export-import policy. It was then that the Harshad Mehta
scam hit the markets and Sensex witnessed unabated selling.
7000, June 20, 2005 On June 20, 2005, the news of the
settlement between the Ambani brothers boosted investor
sentiments and the scrips of RIL, Reliance Energy, Reliance
Capital, and IPCL made huge gains. This helped the Sensex
crossed 7,000 points for the first time.
11,000, March 21, 2006 The Sensex on March 21, 2006 crossed
the magical figure of 11,000 and touched a life-time peak of
11,001 points during mid-session at the Bombay Stock Exchange
for the first time. However, it was on March 27, 2006 that the
Sensex first closed at over 11,000 points.
15
12,000, April 20, 2006 The Sensex on April 20, 2006 crossed the
12,000-mark and closed at a peak of 12,040 points for the first
time.
18,000, October 09, 2007 The BSE Sensex crossed the 18,000-
mark on October 09, 2007. It took just 8 days to cross 18,000
points from the 17,000 mark. The index zoomed to a new all-
time intra-day high of 18,327. It finally gained 789 points to
close at an all-time high of 18,280. The market set several new
records including the biggest single day gain of 789 points at
close, as well as the largest intra-day gains of 993 points in
absolute term backed by frenzied buying after the news of the
UPA and Left meeting on October 22 put an end to the worries
of an impending election.
20,000, October 29, 2007 The Sensex crossed the 20,000 mark
on the back of aggressive buying by funds ahead of the US
Federal Reserve meeting. The index took only 10 trading days to
gain 1,000 points after the index crossed the 19,000-mark on
October 15. The major drivers of today's rally were index
15,200, June 13, 2008 The sensex closed below 15,200 mark,
Indian market suffer with major downfall from January 21,2008
14,220, June 25, 2008 The sensex touched an intra day low of
13,731 during the early trades, then pulled back and ended up at
14,220 amidst a negative sentiment generated on the Reserve
Bank of India hiking CRR by 50 bps. FII outflow continued in
this week.
17
NATIONAL STOCK EXCHANGE LIMITED
18
NSE is mutually-owned by a set of leading financial
institutions, banks, insurance companies and other financial
intermediaries in India but its ownership and management
operate as separate entities[2]. As of 2006, the NSE VSAT
terminals, 2799 in total, cover more than 1500 cities across
India [3]. In October 2007, the equity market capitalization
of the companies listed on the NSE was US$ 1.46 trillion,
making it the second largest stock exchange in South Asia.
NSE is the third largest Stock Exchange in the world in
terms of the number of trades in equities.[4]It is the second
fastest growing stock exchange in the world with a recorded
growth of 16.6%. Origins
INNOVATIONS
MARKETS
• Equity
• Futures and Options
• Retail Debt Market
• Wholesale Debt Market
INDICES
20
CERTIFICATIONS
DERIVATIVE
HEDGERS:
21
In general, hedgers use futures for protection against adverse
future price movements in the underlying cash commodity.
Hedgers are often businesses, or individuals, who at one point
or another deal in the underlying cash commodity.
SPECULATORS:
Speculators are some what like a middle man. They are never
interested in actual owing the commodity. They will just buy
from one end and sell it to the other in anticipation of future
price movements. They actually bet on the future movement in
the price of an asset.
FINANCIAL SYSTEM
The financial system helps to determine both the cost and the
volume of credit. The system can affect a rise in the cost of
funds which adversely affects consumption, productions,
employment and growth of the economy .similarly, lower ring
the cost positive directions. Thus we find that a financial
system has an impact on the basic existence of an economy and
its citizens.
Liquidity function
Payment function
Risk function
23
FLOW OF FUNDS
The public saving finds their way into the hands of those in
production through the financial system. Financial claims are
issued in the money and capital markets, which promise future
income flows. The funds in the hands of the producers result in
production of better goods and services, increasing society’s
standard of living when saving flows decline. However the
growth of the investment and living standard begins to fall
2: LIQUIDITY FUNCTIONS:
3: PAYMENT FUNCTION:
4: RISK FUNCTION:
FINANCIAL MARKETS
A financial market can be defined as the market in which
financial assets are created or transferred in which financial
assets represented a claim of the payment of a sum of money
sometime in the future and periodic payment in the form of
interest or dividend. Definition.
25
Bond markets, which provide financing through the issuance of
Bonds, and enable the subsequent trading thereof.
RAISING CAPITAL
26
Relationship between lenders and borrowers
Financial Financial
Lenders Borrowers
Intermediaries Markets
Interbank Individuals
Stock Companies
Banks
Exchange Central
Individuals Insurance Companies
Money Market Government
Companies Pension Funds
Bond Market Municipalities
Mutual Funds
Foreign Public
Exchange Corporations
LENDERS
Many individuals are not aware that they are lenders, but almost
everybody does lend money in many ways. A person lends money
when he or she:
There are a few companies that have very strong cash flows.
These companies tend to be lenders rather than borrowers. Such
companies may decide to return cash to lenders (e.g. via a share
buyback.) Alternatively, they may seek to make more money on
their cash by lending it (e.g. investing in bonds and stocks.)
BORROWERS
27
Governments often find their spending requirements exceed their
tax revenues. To make up this difference, they need to borrow.
Governments also borrow on behalf of nationalised industries,
municipalities, local authorities and other public sector bodies.
In the UK, the total borrowing requirement is often referred to
as the public sector borrowing requirement (PSBR).
DERIVATIVE PRODUCTS
CURRENCY MARKETS
28
now represent only 1/32 of foreign exchange dealing, according
to BIS.[1]
Much effort has gone into the study of financial markets and
how prices vary with time. Charles Dow, one of the founders of
Dow Jones & Company and The Wall Street Journal, enunciated
a set of ideas on the subject which are now called Dow Theory.
This is the basis of the so-called technical analysis method of
attempting to predict future changes. One of the tenets of
"technical analysis" is that market trends give an indication of
the future, at least in the short term. The claims of the technical
analysts are disputed by many academics, who claim that the
evidence points rather to the random walk hypothesis, which
states that the next change is not correlated to the last change.
CAPITAL MARKET
STOCK EXCHANGE
FEATURES
30
SERVICE TO COMPANIES
SERVICES TO INVESTORS
LISTING OF SECURITIES:
31
A stock exchange does not deal in the securities of all the
companies .it selects certain securities for transaction; such
securities are called listed securities.
32
THE STOCK MARKET, INDIVIDUAL INVESTORS,
AND FINANCIAL RISK
With each passing year, the noise level in the stock market
rises. Television commentators, financial writers, analysts, and
market strategists are all overtalking each other to get investors'
attention. At the same time, individual investors, immersed in
chat rooms and message boards, are exchanging questionable and
often misleading tips. Yet, despite all this available
information, investors find it increasingly difficult to profit.
Stock prices skyrocket with little reason, then plummet just as
quickly, and people who have turned to investing for their
children's education and their own retirement become
frightened. Sometimes there appears to be no rhyme or reason to
the market, only folly.
33
This is a quote from the preface to a published biography about
the long-term value-oriented stock investor Warren Buffett.[2]
Buffett began his career with $100, and $105,000 from seven
limited partners consisting of Buffett's family and friends. Over
the years he has built himself a multi-billion-dollar fortune. The
quote illustrates some of what has been happening in the stock
market during the end of the 20th century and the beginning of
the 21st.
34
PROFILE OF BROKING HOUSE IN THE STOCK
MARKET
KOTAK SECURITIES:
Sharekhan, the retail broking arm of SSKI group and one of the
largest stock broking house in the country has won the
prestigious awaaz consumer vote awards 2005 for the most
preferred stock broking brand in India, in the investment
advisors category
36
Sharekhan Bag round network includes over 250 centres across
123 cities in India and having around 120000 customers and
equal number of demat customers.
MEANS OF FINANCING
38
OTHER BENEFITS OF INVESTING IN SHARES?
Trade in the
Secondary
Market, i.e.
Stock exchanges
39
They are selected by the Index committee.
1) Market capitalization.
2) Liquidity.
3) Continuity.
4) Industry representation.
5) Listed history
40
COMPUTATION OF STOCK INDEX:
Face value=Rs.10/-
Base value=100/-
41
The India Infoline group, comprising the holding company, India
Infoline Limited and its wholly-owned subsidiaries, straddle the
entire financial services space with offerings ranging from
Equity research, Equities and derivatives trading, Commodities
trading, Portfolio Management Services, Mutual Funds, Life
Insurance, Fixed deposits, GoI bonds and other small savings
instruments to loan products and Investment banking. India
Infoline also owns and manages the websites
http://www.indiainfoline.com/and http://www.5paisa.com/
42
Bonanza is a leading Financial Services & Brokerage House with
acknowledged industry Leadership in execution and clearing
services on Exchange Traded Derivatives and cash market
products.
EQUITY
43
US The Karvy group was formed in 1983 at Hyderabad, India.
Karvy ranks among the top player in almost all the fields it
operates. Karvy Computershare Limited is India’s largest
Registrar and Transfer Agent with a client base of nearly 500
blue chip corporates, managing over 2 crore accounts. Karvy
Stock Brokers Limited, member of National Stock Exchange of
India and the Bombay Stock Exchange, ranks among the top 5
stock brokers in India. With over 6,00,000 active accounts, it
ranks among the top 5 Depositary Participant in India,
registered with NSDL and CDSL. Karvy Comtrade, Member of
NCDEX and MCX ranks among the top 3 commodity brokers in
the country. Karvy Insurance Brokers is registered as a Broker
with IRDA and ranks among the top 5 insurance agent in the
country. Registered with AMFI as a corporate Agent, Karvy is
also among the top Mutual Fund mobilizer with over Rs. 5,000
crores under management. Karvy Realty Services, which started
in 2006, has quickly established itself as a broker who adds
value, in the realty sector. Karvy Global offers niche off
shoring services to clients in the US.
Karvy has 575 offices over 375 locations across India and
overseas at Dubai and New York. Over 9,000 highly qualified
people staff Karvy.
44
ABOUT EMKAY
OUR MISSION
45
OUR VALUES
To be fair, empathetic and responsive in serving our customers
THE JOURNEY
46
COMMODITY FUTURES TRADING
THROUGH:
COMMODITY MARKET
47
24 hrs GOLD Spot Price
UNDERSTANDING THE
COMMODITIES MARKETS
48
Motilal Oswal Securities Ltd. was founded in 1987 as a small
sub-broking unit, with just two people running the show. Focus
on customer-first-attitude, ethical and transparent business
practices, respect for professionalism, research-based value
investing and implementation of cutting-edge technology has
enabled us to blossom into an almost 2000 member team.
• Wealth Management
• Broking & Distribution
• Commodity Broking
• Portfolio Management Services
• Institutional Equities
• Private Equity
• Investment Banking Services and
• Principal Strategies
For year ended March 2008, the company showed a strong top
line growth of 91% to Rs.7 bn as compared to Rs.3.68 bn, last
year. New businesses like investment banking, asset management
and fund based activities have contributed to this growth.
49
FY Growth
Rs. Crores
2007- 08 (YoY)
Total
701 91%
Revenues
EBIDTA 270 97%
PAT 156 100%
WEALTH MANAGEMENT
COMMODITY BROKING
50
Through Motilal Oswal Commodities Broker (P) Ltd our fully
owned subsidiary; we provide commodity trading facilities and
related products and services on MCX and NCDEX. Besides
access to the best of research in the form of Daily Fundamentals
& Technical Reports on highly traded commodities, our clients
also get access to our exclusive Customized Trading Advice on
both the trading platforms. We offer these services through our
branches, Business Partner locations, the internet and mobile
channels
INSTITUTIONAL EQUITIES
INVESTMENT BANKING
51
We offer financial advisory services relating to mergers and
acquisitions (domestic and cross-border), divestitures,
restructurings and spin-offs through Motilal Oswal Investment
Advisors Private Ltd. (MOIAPL)
PRIVATE EQUITY
MOVCAPL will manage and advise the fund and other private
equity funds, which may be raised in the future. In its final
closing, in December 2007, the fund obtained commitments of
US$125 mn (Rs.4,875 mn) from investors in India and overseas.
The Fund has deployed/ committed $ 58 mn across 8 deals.
FOCUS ON RESEARCH
52
Research is the solid foundation on which Motilal Oswal
Securities advice is based. Almost 10% of revenue is invested
on equity research and we hire and train the best resources to
become advisors. At present we have 28 equity analysts
researching over 27 sectors. From a fundamental, technical and
derivatives research perspective; Motilal Oswal's research
reports have received wide coverage in the media (over a 1000
mentions last year). Our consistent efforts towards quality
equity research has reflected in an increase in the ratings and
rankings across various categories in the AsiaMoney Brokers
Poll over the years
53
Religare Enterprises Limited (REL), is one of the leading
integrated financial services groups of India. REL’s businesses
are broadly clubbed across three key verticals, the Retail,
Institutional and Wealth spectrums, catering to a diverse and
wide base of clients.
REL offers a multitude of investment options and a diverse
bouquet of financial services and has a pan India reach in more
than 1550 locations across more than 460 cities and towns.
As part of its recent initiatives, the group has also started
expanding globally and has acquired London’s oldest brokerage
& investment firm, Hichens, Harrison & Co. plc. Following this
acquisition Religare now proposes to operate out of 10
countries. With a view to expand, diversify and introduce
offerings benchmarked against global best practices, Religare
has entered into joint ventures with the global major- Aegon for
its Asset Management and Life Insurance businesses in India.
Religare’s wealth management subsidiary is now rechristened as
Religare Macquarie Wealth Management Limited, following a
joint venture with the Australia based financial services major,
Macquarie Bank. Religare has also partnered with Vistaar
Entertainment to launch India’s first Film Fund.
The vision is to build Religare as a globally trusted brand in the
financial services domain and present it as the ‘Investment
Gateway of India’. All employees of the group guided by an
experienced and professional management team are committed to
providing financial care, backed by the core values of diligence
and transparency.
54
OUR GROUP STRUCTURE
• Equity Broking
• Portfolio Management Services
• Depository
• Online Investment Portal
• Institutional Equity Broking
• Commodity Business
• Investment Banking
• SEBI Registered Merchant Banker
• Acquisition in UK through an international arm
55
Religare Macquarie Wealth Management Limited
OUR SCHEMES
PANTHER
TORTOISE
ELEPHANT
57
CATERPILLAR
LEO
INVESTMENT BANKING
CORPORATE FINANCE
MERCHANT BANKING
• IPO/FPO/RIGHTS
• Mergers & Acquisitions
• Corporate Advisory Services
• ADR/GDR/FCCB
58
• BUY BACK OF SHARE
ABOUT INDIABULLS
Business of the company has grown in leaps and bounds since its
inception. Revenue of the company grew at a CAGR of 159%
from FY03 to FY07. During the same period, profits of the
company grew at a CAGR of 184%.
59
Last traded 250.00 Change 18.55 (8.01%)
*
Computed on last 15 days' trading figures.
60
MUTUAL FUND
61
ABOUT US
Clients can trade through us online on BSE and NSE for both
equities and derivatives. They are supported by dedicated sales
& trading teams in our trading desks across the country.
Research and investment ideas can be accessed by clients either
through their designated dealers, email, web or SMS.
62
MUTUAL FUNDS
DEPOSITORY SERVICES
COMMODITIES
63
INSURANCE BROKING
• Risk Management
• Due diligence and research on policies available
• Recommendation on a comprehensive insurance cover based
on clients needs
• Maintain proper records of client policies
• Assist client in paying premiums
• Continuous monitoring of client account
IPO’s
64
INVESTMENT BANKING
65
RESEARCH OBJECTIVE
STATEMENT OF PROBLEM
67
RESEARCH METHODOLOGY AND LIMITATION
RESEARCH DESIGN
68
a. To sale the products we have to first generate database on the basis of marketing
research.
This step called for decision on the data sources, sampling plan
and contact methods.
DATA SOURCES
i. PRIMARY DATA
RESEARCH APPROACH
The research approach adopted here was the survey method. But
other approaches also used such as observation research.
DATA COLLECTION:
1. SAMPLING METHOD:
69
The sampling method, which is adopted, is Random Sampling.
2. DATA ANALYSIS:
DATA COLLECTION
PRIMARY DATA
SECONDARY DATA
DATA ANALYSIS
STUDY
70
SAMPLE SIZE
SAMPLING METHOD
71
27%
male
female
73%
50
45
40
35
30 male
25
female
20
15
10
5
0
male female
BRIEF ANALYSIS
LIMITATION OF STUDY
72
fundamental analysis being used but now technical analysis
2. Once the people who are involved in it. They play it like
73
CONCLUSION AND SUGGESTIONS
If people know the truth and have knowledge about the market
than can take some risks. Stock cant be predicted no one is sure
what going to happen the next movement it’s a much volatile
market. If someone is sure about the up trepanned than why the
stop loss being set if because there is no surety
74
QUESTIONNAIRE
1. What is a commodity?
75
ANS: 1. Hedgers
2. No counter party risks
3. Higher Leverage: Get high exposures for the margin
provided
4. Prices are pegged to international markets of NYMEX,
CBOT, CME, LME etc
76
8. What are the commodity derivatives market
timings?
Commodity prices are generally less volatile than the stocks and
this has been statistically proven. Therefore it's relatively safer
to trade in commodities. Also the regulatory authorities ensure
through continuous vigil that the commodity prices are market-
driven and free from manipulations. However all investments are
subject to market risk and depend on the individual’s decision
Brokerage
Service Tax
BIBLIOGRAPHY
Websites:
www.google.com
www.wikipedia.com
www.sharekhan.com
www.religare.com
www.karvay.com
www.indiabulls.com
Indiainfoline.com
77
Books, magazines& newspaper
Business times
Research methodology(c.s kothari)
Economic times
Financial management (paresh shah)
78