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PART A INDUSTRY PROFILE

PROJECT TITTLE: Importance of derivatives in Indian Market

1.Industry Profile :
Religare Enterprises Limited (REL) is one of Indias leading diversified financial services groups. REL offers an integrated suite of financial services including asset management, life and health insurance, lending, broking, investment banking, and wealth management. Religare Enterprises is headquartered in New Delhi and is listed on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) in India. Religare is also building an Asia & emerging markets focused Institutional equities & Investment Banking business and a multi-boutique global asset management platform to tap the broader opportunities offered by the most promising emerging markets around the world.

Religare Enterprise Limited, through its subsidiaries, offers a range of financial products and services to retail investors, high net worth individuals, and corporate and institutional clients in India and internationally. The company offers retail equity and commodity broking, personal and corporate finance, online trading, wealth advisory, portfolio management, priority client equity services, arts initiative, international advisory, life and non-life insurance broking, reinsurance, investment banking, and institutional broking services. It also provides depository and wealth management services, as well as fund management services, including film fund management and asset management. In addition, the company involves in other activities, such as fund raising and placement; contracts for difference; and conducting research in various areas covering economic research, result expectations, derivative strategies, IPO research, mutual fund research, special reports like impact of credit policy and budget, metals, and agricommodities. Religare Enterprise Limited is based in Noida, India.

PROJECT TITTLE: Importance of derivatives in Indian Market

2.Company Profile : A .Background and inception of the company :


Initially REL was a stock brokerage firm called Religare Securities Ltd. (RSL) and was admitted to the National Stock Exchange (NSE) in 1994. In 2000, it secured membership of the Futures and Options segment of the NSE and also registered with NSDL as a depository participant. Religare Finvest, a group company, was founded in 2001 as a private non-banking financial institution. RSL registered with CDSL as a depository participant in 2003. It also became a stock broker at the Bombay Stock Exchange (BSE) in 2004. In the same year, Religare Commodities Ltd., a commodities broking company, started operations as a trading cum clearing member at both the MCX and the NCDX. An office was established in London in 2006. Religare announced a joint venture with Macquarie Bank Ltd. in October 2007 to expand its wealth management business. REL went public with an initial public offeringof its stock in November, 2007. AEGON Religare, a life insurance joint venture between AEGON, Religare and Bennett Coleman & Company, launched its pan-India operations in 2008. Religare Asset Management Company was formed on the back of Religares acquisition of Lotus India AMC from majority shareholders, Alexandra Fund Management. Religare Capital Markets and Religare Global Asset Management were formed for international expansion. In 2009, Religare Macquarie Private Wealth won the Private Banker International (PBI) Global Wealth Awards2009 for the Most Exciting New Wealth Management Model. Religare Enterprises Ltd received the Master Brand Award for 2010 and Best Marketing Campaign of the year at World Brand Congress 2010. In 2011, Religare Capital Markets was adjudged the Most Improved Brokerage in the Last 12 Months by Asia Money Brokers Poll. In 2012, Religare Securities Limited was awarded the Best Investor Education & Category Enhancement Currency Broker at the Bloomberg UTV Financial Leadership Awards and Religare Commodities Limited was awarded the Best Commodity Broker at the Bloomberg UTV Financial Leadership Awards. Religare runs an Investor Awareness Program which, through a number of awareness and education led initiatives, helps people understand the economy and the financial markets. It partners with the Save LIFE Foundation, a non- profit NGO that focuses on bystander care for road accident victims in India, the Akshaya Patra Foundation, and a school meal program to facilitate the education of underprivileged children in India, and the SOS Childrens Villages of India which provides care to orphaned children.

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B. Nature of business carried:


Indian Business : In India, we offer a wide array of complementary services including SME focused lending solutions, retail broking, life and health insurance, asset management, investment banking and wealth management. Outside India, we are also building an Asia & emerging markets focused Institutional equities & Investment Banking business and a multi-boutique global asset management platform to tap the broader opportunities offered by the most promising emerging markets around the world.

SME Lending Solutions: Religare Finvest Limited (RFL) a subsidiary of Religare Enterprises Limited (REL), is a Small and Medium Enterprise (SME) financing focused NBFC. With a wide network of branches and ISO certification 9001:2008, RFL is committed to providing debt capital to power the growth of the SMEs. RFL understands that each financial need is unique and offers customized solutions to empower the customer to prosper. With a belief that the customers success is their success, its presence in 25 branches across all major cities plays a vital role in nurturing the customers business while growing to a book size of over INR 11308 Crores. (As on 31st March 2013). RFL has been awarded the Finnoviti 2012 award in the Innovation in Process category. Retail Broking : Religare Securities Ltd. (RSL) is a wholly owned subsidiary of Religare Enterprises Limited (REL) and is one of the market leading securities firms in India serving over 8 lakh clients across both Offline and Online platforms. Through its extensive footprint extending to over 500 cities, the company offers broking services in Equity, Currency and Commodity (through its subsidiary Religare Commodities Limited) as well as depository participant services. RSL is a member of the NSE, BSE, MCXSX, USE and a depository participant with NSDL and CDSL. RSL also offers TIN facilitation & PAN facility at select branches - a unique service to help an individual with PAN, TAN and TDS/TCS returns related requirements. In addition, RSL is an NSDL-appointed enrolment agency for Aadhaar UID (Unique Identification Number) and an AMFI-registered mutual fund distributor. The platform has been endorsed by various awards. RSL was awarded the "Best Investor Education & Category Enhancement Currency Broker" and the "Best Commodity Broker" at the Bloomberg UTV Financial Leadership Awards in 2012. RSL was also ranked among the top three retail equity brokerage houses in India and adjudged "Best Broking House with a Global Presence" by Dun & Bradstreet. PROJECT TITTLE: Importance of derivatives in Indian Market 4

Asset management : With an average asset base of over INR 138 bn (for the quarter ending June 2013), Religare Invesco Asset Management aims to serve investment needs of domestic and global investors; individuals, corporate and institutions through mutual funds and sub-advised portfolios. The product portfolio is managed by individually focused best of breed management teams to create optimum balance and results.

Wealth Management :

Religare Macquarie Wealth Management (RMWM) is a SEBI-registered Portfolio Management Advisor formed through a joint venture between Religare and Macquarie of Australia. Through this amalgamation, the company offers the best of both companies Religares intimate knowledge of the Indian market and Macquaries global experience and expertise in designing sophisticated products.

The business provides a broad spectrum of investment solutions and services ranging from traditional solutions such as mutual funds, insurance and PMS to cutting-edge next generation investment solutions, both onshore and offshore. It also offers more unique services such as real estate and art advisory and estate planning.

The companys belief is that the investment needs of HNIs in India have evolved considerably. Increased client sophistication and complex investment vehicles combined with dynamic market conditions have given rise to a new breed of investors who value investment advice. Accordingly, since its inception, RMWM has positioned itself as an open-architecture advisoryled model with the belief that this approach is sustainable over the long term.

Life Insurance:

AEGON Religare Life Insurance Company Limited (ARLI), is a three-way joint venture between AEGON of the Netherlands (26%), Religare (44%) and Bennett, Coleman & Company Limited (30%). This venture is dedicated to build a profitable customer-centric business with scale, PROJECT TITTLE: Importance of derivatives in Indian Market 5

provide a work environment that fosters excellence and innovation. This joint venture adopts a local approach with the power of global expertise.

ARLI launched its pan-India operations in July, 2008 following a multi-channel distribution strategy with a vision to help people plan their life better. The fulfillment of this vision is based upon having a complete product suite, providing customized advice and enhancing the overall customer experience.ARLI has launched a suite of products that are focused on providing the customer with the means to meeting their long-term financial goals. At the same time product development has been founded on the tenet of providing the customer with great value. ARLI products such as iTerm, maximize, Future Protect and Rising Star have been ranked among the best in terms of value and have attracted many external accolades.

Health Insurance:

Religare Health Insurance Company Limited, the health insurance arm of Religare Enterprises Limited (REL), is a specialized Health Insurer offering health insurance services to employees of corporate and individual customers. Launched in July12, Religare Health Insurance has made significant progress over the past 12 months, and is already operating out of 30 branches, servicing more than 5,00,000 lives across 300+ locations including over 200 corporates.The shareholders of Religare Health Insurance comprise of three strong entities Religare Enterprises Limited, Union Bank of India & Corporation Bank.Religare Health Insurance has been awarded the Technology Innovation in Health Insurance Award at the prestigious Indian Insurance Awards - 2013.

Global Business : EM capital Market platform : Religare Capital Markets (RCM) is an Asia and India focused Capital Markets platform, recognized by clients and independent agencies alike for the quality of its research and execution. RCM is empaneled by nearly 600 institutional investors and covers 250 stocks under its research umbrella globally. The business offers a comprehensive suite of services across Institutional Equities and Investment Banking. The Institutional Equities business specializes in Equity Research, Sales and Execution in Asian and Indian equities. In Investment Banking RCM

PROJECT TITTLE: Importance of derivatives in Indian Market

provides Equity Capital Markets, Corporate Finance and Private Financing services to clients worldwide.

Global Asset Management: Religare Global Asset Management (RGAM) operates a multi-boutique asset management business. RGAM partners with established institutional-quality asset managers that offer forward looking investment strategies and have track record of superior performance. Our key Affiliates currently include Landmark Partners & Northgate Capital and our aggregate assets under management through our Affiliates are over US$ 13.1 billion (as on 31st March 2013). RGAM facilitates the development of Affiliates business through access to its centralized distribution and service teams in Asia, through which Affiliates can raise capital and service investors in Asian markets they might not otherwise have access to. Religares established presence in key emerging markets benefits Affiliates by providing them with access to local knowledge and deal flow in those markets. Moreover, each Affiliate benefits from the size effect of an aggregate multi-boutique business, where cross pollination of resources and relationships creates a network effect.

PROJECT TITTLE: Importance of derivatives in Indian Market

C.MISSION, VISION AND VALUES


Vision is the ability to see beyond what is apparent and look deeper. It is the capacity to focus on the potential, instead of limitations, that leads to success. At Religare, this mantra lies at the core of all our endeavours. Its a philosophy that has stood us in good stead, even as we have progressed from strength to strength, locally and globally.With the worldwide rebalancing of the economy, the emerging markets are becoming more dynamic, initiating more opportunity and capital. They are becoming significant wealth generators and drivers of the global economy. Our business institution is positioned right in the centre of this mega-trend. We are focused on tapping these opportunities and looking to grow along with our key stakeholders. Our vision is firmly anchored in India and we are leading in the emerging markets growth story, driving it with innovative products and solutions, and creating value. We have a unique portfolio of businesses in all asset classes, in markets with amazing tailwinds. The foundation for any successful business is its people and systems, into which we have already made significant investments. Over the last few years, we have successfully built a one stop financial services shop that is well poised to exploit the growth in Indian financial services. In order to tap the huge potential in emerging markets in the future, we have an experienced global capital markets team in place, offering a client-centric platform with high quality sectoral and product content and execution capability.Its our belief that we live in exciting times. In an era, that is seeing a paradigm shift in the growth engines and power centers of world economy together with new hopes, aspirations and expectations from global citizens of the world. A world that is increasingly borderless, timeless and characterized by equal opportunity. Therefore, we are focused on taking Religare into emerging markets which offer lucrative opportunities, wherein we will define new standards through an exciting customercentric approach and inclusiveness.

PROJECT TITTLE: Importance of derivatives in Indian Market

D. Products/Service profile;
Religare Enterprises has several subsidiary companies including: 1. Religare Securities Limited (RSL), the broking arm of REL, offers services such as equity broking (cash and derivatives segments), currency futures and options broking and depository participant services. It is affiliated with the country's leading exchanges (NSE and BSE) and is a depository participant with NSDL and CDSL. 2. Religare Finvest Limited (RFL) is an NBFC that provides lending solutions to the SME sector. It has a book size of INR 89.7 billion or nearly USD 2 billion and a network of 46 branches in 13 states, covering the major SME clusters across India. 3. Religare Invesco Asset Management Company Private Limited (RIAMCPL), the domestic asset management arm of Religare, is Indias 13th largest mutual fund house by AUM. With nearly 12,250,000 folios, it has a presence in 658 business locations across 155 cities. 4. Religare Macquarie Wealth Management (RMWM) is a SEBI-registered Portfolio Management Advisor formed through a joint venture between Religare and Macquarie of Australia. It has positioned itself as an open-architecture advisory-led model. 5. AEGON Religare Life Insurance Company Limited (ARLI) is a three-way joint venture between AEGON of the Netherlands (26%), Religare (44%) and Bennett, Coleman & Company Limited (30%). 6. Religare Capital Markets (RCM) is an Emerging Markets Capital Markets platform offering institutional equities and investment banking services. With over 340 people worldwide, RCM has offices across Asia, Africa, the Middle East, Europe, Australia and the Americas. 7. Religare Global Asset Management (RGAM) is an asset management business. Northgate Capital and Landmark Partnersare affiliates of RGAM. Product and service offeringunder three broad client interface categories: Retail Spectrum, Wealth Spectrum and Institutional Spectrum.

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E. Area of operation-global/national/regional:
Religare Enterprises Limited (REL) is an international financial services group headquartered in New Delhi, India. It offers brokerage, insurance, asset management, SME lending, wealth management, institutional equities and investment banking services. It has one million clients in India and 2200 offices in 550 cities. Religare also has offices in Hong Kong, Singapore, the United States, the United Kingdom, Japan, the Middle East and Sri Lanka.

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F. Ownership pattern :
Share holder pattern : As on : Face Value 30-Jun-2013 10

No. Of Shares % Holding PROMOTER HOLDING Foreign Promoters Indian Promoters Sub Total NON PROMOTER HOLDING Institutional Investors Mutual Funds and UTI 417 0.00 1.08 1.54 2.62 50 107,197,124 107,197,174 0.00 71.75 71.75

Banks Fin. Inst. and Insurance 1,611,870 FIIs Sub Total Other Investors Private Corporate Bodies NRIs/OCBs/Foreign Others Directors Others Sub Total General Public GRAND TOTAL 1,517,782 16,754,231 0 286,864 18,558,877 19,727,982 149,401,323 2,305,003 3,917,290

1.02 11.21 0.00 0.19 12.42 13.20 100.00

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Ownership pattern (Board of directors ) :

Mr. Sunil Godhwani

Chairman & Managing Director Religare Enterprises Limited


Mr. Ravi Mehrotra

Director
Mr. Monish K Dutt

Non-executive, Non-Independent Director


Mr. Virendra Kumar Madan

Non-executive, Non-Independent Director


Mr. Arun Ramanathan

Non-executive, Independent Director


Mr. A. C. Mahajan

Non-executive, Independent Director


Mr. R. K. Shetty

Non-executive, Independent Director


Mr. Harpal Singh

Non-executive Director
Mr. Deepak Ramchand Sabnani

Independent Director
Mr. Padam Bahl

Independent Director
Capt. G. P. S. Bhalla

Alternate to Mr. Deepak Sabnani


Executive committee:

Mr. Shachindra Nath

Group Chief Executive Officer Religare Enterprises Limited

Mr. Anil Saxena

Group Chief Finance Officer Religare Enterprises Limited

Mr. Kamlesh Dangi

Group Chief People Officer Religare Enterprises Limited

Mr. Anuj Gulati

Managing Director & CEO Religare Health Insurance Company Limited

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Mr. Basab Mitra

CEO Capital Markets and Wealth Management Religare Enterprises Limited

Mr. Kavi Arora

Managing Director & CEO Religare Finvest Limited

Mr. Saurabh Nanavati

Managing Director & Chief Executive Officer Religare Invesco Asset Management Company Pvt. Ltd.

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G.COMPETITORS
There are various competitor of religare who are providing same services to customers. Some competitors are INDIA BULLS RELIANCE MONEY KARVEY SECURITIES LIMITED BAJAJ CAPITAL ANAND RATHI SHAREKHAN SECURITIES LIMITED ICICI DIRECT.COM INDIA INFOLINE MOTILAL OSWAL SECURITIES NETHWORTH SECURITIES LIMITED A.C MEHTA BHARAT CAPITAL ANGEL BROKERS

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H. Achievement /awards :
2008 :

Religare Enterprises Ltd awarded by Outlook Money NDTV profit for Best IPO listing. LIPPER-STARMINE Award for Excellence in Research organized by Thomson Reuters awarded to Religare Securities Limited.

2009 :

Religare Capital Markets Ltd awarded for excellence in deal making for the Ranbaxy Daiichi deal in the HealthCare/ Life Sciences Category. Brand excellence in the Banking and Financial services category at ''The World Brand Congress 2009''. Religare Macquarie Private Wealth won the Private Banker International (PBI) Global Wealth Awards 2009 for the ''Most Exciting New Wealth Management Model''. In Asia Money: Brokers Poll - 2009, Religare Capital Markets Limited - Institutional equties division was ranked 7th in the ''Best Local Brokerage'' category and 5th in the ''Most Improved Brokerage'' category. Religare Securities equity broking - subsidiary awarded by D & B for the category "best broking house-with a global presence". CEO CLUBS INTERNATIONAL AWARDS, Mr. Sunil Godhwani was conferred the "CEO of the year Award" for the year 2009 Religare Enterprises Limited wins "Amity Corporate Excellence Award for Best Financial Services Firm" Mr. Sunil Godhwani, was conferred the ''Udyog Rattan Award'' under the aegis of Institute of Economic Studies at Indian Habitat Centre Religare Enterprises Limited conferred the ''Excellence Award'' sponsored by Institute of Economic Studies at Indian Habitat Centre At the Goafest 2009 Abby awards, AEGON Religare Life Insurance was the only company to win an award in the "Best Integrated Campaign in the Financial Services" category. AEGON Religare Life Insurance''s debut campaign K.I.L.B.(Kum Insurance LenekiBimari) was awarded Gold in the category ''Outdoor Media Plan of the Year'' at the Outdoor Advertising Convention (OAC) 2009. 2010:

Religare Securities Limited was awarded the "Best Broking House with a Global Presence" by Dun and Bradstreet for 2010. PROJECT TITTLE: Importance of derivatives in Indian Market 16

Religare Tax Plan awarded the first runner up for NDTV mutual fund awards in the Equity Tax plan Category. Religare Capital Markets Ltd was awarded Best Deal in the Health Care Category for Acquisition of stake in Parkway Holdings Ltd by Fortis Health Care Ltd in the HealthCare/ Life Sciences Category. Religare awarded Greentech HR Excellence Awards, 2010 in 2 categories - Innovation in Recruitment & Technology Excellence in HR. Mr. Sunil Godhwani, conferred the ''Indian Business Leader of the Year'' award at the Global Indian Business Meeting hosted by Horasis.

2011 :

Religare Capital Markets has been adjudged the "Most Improved Brokerage in the Last 12 Months" by Asia Money Brokers Poll. Religare Broking TVC (archery creative)won Silver Abby in the Sound and Design craft category at Goafest 2011. Religare Capital Markets Limited has been awarded the coveted Starmine award for the "Best Brokerage Research House". Religare Commodities Ltd has been awarded the ''The Best Commodity Broker of the year'' at the Bloomberg UTV''s financial Leadership awards. Religare Enterprises Ltd presented the theBest Retail Marketing Campaign of the Year 2010 at Asia Retail Congress. Religare Enterprises Ltd received the coveted Master Brand Award for 2010 and Best Marketing Campaign of the year at World Brand Congress 2010.

2012 :

Religare Finvest Limited has been awarded the Finnoviti 2012 award in the Innovation in Process category. Religare Securities Limited has been awarded the "Best Investor Education & Category Enhancement Currency Broker" at the Bloomberg UTV Financial Leadership Awards. Religare Commodities Limited has been awarded the "Best Commodity Broker" at the Bloomberg UTV Financial Leadership Awards.

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In Charge Metals, Energy & Currency Research, Religare Securities Limited was conferred with Indias Best Market Analyst- Commodities Technicals Award at Zee Indias best Market Analyst Awards 2013.

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I.Work Flow Model :

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ligare Life Insurance (ARLI) as the E-Business Leader under the category of Overall Insurance Industry Awards. Religare Health Insurance has been awarded the Technology Innovation in Health Insurance Award at the prestigious Indian Insurance Awards - 2013.

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J. FUTURE GROWTH AND PROSPECTS


Religare Health Insurance will get a capital infusion of Rs 100 crore this fiscal to support its business growth, a top company official said. We currently have a paid-up capital of Rs 450 crore and we plan to enhance it to Rs 550 crore by the end of the year to support our expansion plans, said Manasjie Mishra, Chief Executive Officer of religare Religare a health insurance is a joint venture between religare Healthcare (74 per cent) and UKbased Bupa (26 per cent). The health insurers gross premium collection more than doubled to Rs 207 crore in FY13. The company is eyeing a similar growth in premium collection this fiscal too. Premium rates Religare has filed for an upward revision in premium rates in some categories. Further, additional features have been incorporated in some of the existing products. Both these are awaiting regulatory approval, said Mishra. The health insurer has a 92 per cent claims settlement ratio. According to him, the current prices of group health insurance products are unsustainable and the insurer will continue to focus on individual health insurance products which constitute 80 per cent of its portfolio. The health insurer, which completed three years of operations last fiscal, is planning to add 12 branches and take the total number to 33. It plans to break-even in the next 3-4 years. religare launched a group personal accident plan, which is a corporate floater. It also provides coverage for broken bones and temporary total disability due to accidents.

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3. MC KINSEI 7S FRAM WORK.


The Seven Elements The McKinsey 7S model involves seven interdependent factors which are categorized as either "hard" or "soft" elements:

Hard Elements Strategy Structure Systems

Soft Elements Shared Values Skills Style Staff

"Hard" elements are easier to define or identify and management can directly influence them: These are strategy statements; organization charts and reporting lines; and formal processes and IT systems. "Soft" elements, on the other hand, can be more difficult to describe, and are less tangible and more influenced by culture. However, these soft elements are as important as the hard elements if the organization is going to be successful. The way the model is presented in Figure 1 below depicts the interdependency of the elements and indicates how a change in one affects all the others.

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Let's look at each of the elements specifically:


Strategy: the plan devised to maintain and build competitive advantage over the competition. Structure: the way the organization is structured and who reports to whom. Systems: the daily activities and procedures that staff members engage in to get the job done. Shared Values: called "superordinate goals" when the model was first developed, these are the core values of the company that are evidenced in the corporate culture and the general work ethic.

Style: the style of leadership adopted. Staff: the employees and their general capabilities. Skills: the actual skills and competencies of the employees working for the company.

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4. Corporate Structure :
Our Corporate Structure

Religare brand Identity Our Brand Identity Religare is a Latin word that means to bind together. We chose this name to reflect the integrated nature of our services. Our name is paired with the symbol of a four-leaf clover. Traditionally, it is considered good fortune to find a four-leaf clover as there is only one fourleaf clover for every 10,000 three-leaf clovers found. Each leaf of the Religare clover has a special meaning. It is a symbol of Hope, Trust, Care and Good Fortune. The first leaf of the clover represents Hope The aspirations to succeed. The dream of becoming. Of new possibilities. It is the beginning of every step and the foundation on which a person reaches for the stars. The second leaf of the clover represents Trust

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The ability to place ones own faith in another. To have a relationship as partners in a team. To accomplish a given goal with the balance that brings satisfaction to all, not in the binding, but in the bond that is built. The third leaf of the clover represents Care The secret ingredient that is the cement in every relationship. The truth of feeling that underlines sincerity and the triumph of diligence in every aspect. From it springs true warmth of service and the ability to adapt to evolving environments with consideration to all. The fourth and final leaf of the clover represents Good Fortune Signifying that rare ability to meld opportunity and planning with circumstance to generate those often looked for remunerative moments of success.

Products : 1 . Broking 2 . SME Loans 3 . Mutual Funds 4 . Insurance 5 . Private Wealth 6 . Institutional Equities 7 . Investment Banking

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5.SWOT ANALYSIS :
SWOT analysis (alternatively SWOT Matrix) is a structured planning method used to evaluate the Strengths, Weaknesses, Opportunities, and Threats involved in a project or in a business venture. A SWOT analysis can be carried out for a product, place, industry or person. It involves specifying the objective of the business venture or project and identifying the internal and external factors that are favorable and unfavorable to achieving that objective. Setting the objective should be done after the SWOT analysis has been performed. This would allow achievable goals or objectives to be set for the organization. Strengths: characteristics of the business or project that give it an advantage over others Weaknesses: are characteristics that place the team at a disadvantage relative to others Opportunities: elements that the project could exploit to its advantage Threats: elements in the environment that could cause trouble for the business or project

This comprehensive SWOT profile of Religare Enterprises Limited provides you an in-depth strategic analysis of the companys businesses and operations. The profile has been compiled by Global Data to bring to you a clear and an unbiased view of the companys key strengths and weaknesses and the potential opportunities and threats. The profile helps you formulate strategies that augment your business by enabling you to understand your partners, customers and competitors better. This company report forms part of GlobalDatas Profile on Demand service, covering over 50,000 of the worlds leading companies. Once purchased, GlobalDatas highly qualified team of company analysts will comprehensively research and author a full financial and strategic analysis of Religare Enterprises Strength: We are a financial services company in India, offering a wide range of financial products and services targeted at retail investors, high net worth individuals and corporate and institutional clients. We are PROJECT TITTLE: Importance of derivatives in Indian Market 26

promoted by the promoters of Ranbaxy Laboratories Limited. We operate from six regional offices and 25 sub-regional offices and have a presence in 330 cities and towns controlling 979 locations managed by us and our Business Associates all over India, as well as a representative office in London. While the majority of our offices provide the full complement of our services, we also have dedicated offices 1. Regional management for retail branch network. 2. Distinctive expertise with focused servicing model 3. Geared to address the competitive challenges of discount brokerage through online investment portal. 4. Grow existing product lines and expand our products and services portfolio 5. Continue to develop client relationships 6. Pursue strategic acquisitions and alliances. 7. Growing client base built on well-recognized brand 8. Diversified product portfolio

Weakness: 1 .Credit risk exposes us to losses caused by financial or other problems experienced by third parties. 2 .Our proposed insurance business may incur losses for some years, which may adversely affect our business and financial performance. 3 .Commodity futures trading may be illiquid. In addition, suspensions or disruptions of market trading in the commodities markets and related futures markets may adversely affect ourcommodities brokerage business. 4 .We are subject to uncertainties associated with the securities industry and fluctuating revenues. 5 .Our business is dependent on systems and operations availability and any interruptions in our transaction systems could lead to decline in our sales and profits. Threats : 1 .We have been in the past and may in the future be barred by securities regulators from dealing inmthe securities of certain Indian companies. 2 .Our Company and certain of our Promoter Group companies are subject to third party claims of intellectual property infringement. 3 .Our risk management policies and procedures may leave us exposed to unidentified risks or unanticipated levels of risk. 4 .Credit risk exposes us to losses caused by financial or other problems experienced by third parties. 5 .We face risks associated with margin lending in our trading business.

Opportunities : 1 . Increase geographical presence 2 .Expand our Internet-based delivery 3 .Grow existing product lines and expand our products and services portfolio PROJECT TITTLE: Importance of derivatives in Indian Market 27

4 .Continue to develop client relationships 5 .Pursue strategic acquisitions and alliances. Future Growth : At Religare, we think beyond business. We are deeply committed to being responsible contributors to society. As a global financial services group, offering a wide array of products and services and serving over a million clients, our mission is to "Empower the Investor". Our Investor Awareness Programmes help investors navigate the financial markets better. We also publish books and articles that demystify complex products and concepts for the common man. Our latest publication, Investing in Commodities Made Easy has been a runaway success. We are also involved proactively in community building. Through initiatives in the field of education, health, arts and women empowerment, we contribute towards building a stronger society. We have partnered with the Save Life Foundation, the Akshaya Patra movement and the SOS Childrens Village to further our social objectives. The Religare Art Residency programme identifies and mentors budding artists.

Partnership with Save LIFE Foundation: Partnered with the Save LIFE Foundation (SLF) a non- profit, non-governmental organization that focuses on bystander care for road accident victims in India. Our support will enable SLF to prepare professionally designed training material for distribution and enhance their primary research capabilities. Sponsorship of Family Home at SOS Childrens Village: Approximately 5000 children die every day in India, due to lack of amenities or nutrition. To tackle this problem Religare has partnered with SOS Childrens Villages of India which sets up homes that look after orphaned children. Each village has homes with 8-10 children who stay there till they complete their education. Association with Give India: We have begun an employee initiative with the Give India Foundation, where employees donate a part of their salaries to their pet causes. Part of the Akshaya Patra Movement: Joined hands with the Akshaya Patra movement, a pioneering school meal program that provides unlimited, nutritious, hygienically cooked hot noon meals in government schools and government run day-care centers (anganwadis). Religare has agreed to sponsor 1,000 children for a period of one yea

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6.Analysis of Financial statement :


FY 2011 -2012

OPERATIONS We recorded a 'Consolidated Loss before Tax' of Rs. 964.29 million, for Financial Year 2011-2012 as compared to Consolidated Loss before Tax' of Rs. 1,989.86 million for Financial Year 2010-2011, 'Loss after Tax after Minority Interest' was Rs. 2,127.65 million for Financial Year 2011-2012 as compared to 'Loss after Tax after Minority Interest'Rs. 3,005.20 million for Financial Year 2010-2011. Consequently basic earnings (losses) per share declined to Rs. (15.80) in Financial Year 2011-2012 from Rs. (22.98) in Financial Year 2010-2011. FY 2009 -2010:

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OPERATIONS Past two financial years have been challenging times in recent history for financial services industry and the global economy. While we saw a recessionary dip and companies adopting corrective measures in FY 2009, economy showed signs of recovery and return of optimism in FY 2010. Today, the economic indicators over the world and especially in India, have begun to indicate that the worst might be over and we are well poised to take advantage of the renewed interest. During the past financial year, the strategic imperatives that have defined and distinguished our Company continued to serve us well. We maintained our focus on risk management, strategic investments, extending global footprint and strengthening investment banking and asset management businesses. Our results for FY 2010 are a reflection of the fine balance we have struck between current performance and investments in emerging lines of business. Consolidated revenues for the year were higher at Rs. 16,752.21 million, an increase of 40%, over Rs. 11,910.64 million as compared to FY 2009. However, Consolidated Net Profit for FY 2010 stood at Rs. 969.24 million as compared to a consolidatedloss of Rs. 635.8 million last year. With signs of recovery clearly visible and higher broking volumes, our Broking and Lending Business contributed significantly in revenue growth, growing by 59% and 35% respectively in FY 2010. Interest expense in FY 2010 also decreased marginally further helping the margins for FY 2010. Retail continues to expand its distribution reach across India covering 2092 business locations in 557 cities at the end of FY 2010 as compared to 1853 business locations and 503 cities in FY 2009. Going forward, we expect that as some of our new businesses mature, we will continue to see superior growth while maintaining the flexibility to make further investments.

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7.LEARNING EXPERIENCE
This was an opportunity for me to work on project on religare with this company I was able to learn the finances of Health Insurance and work flow of the company ,I will like to thanks to all company employees who helped me making my project. This last point is becoming especially obvious in the latest group assignment I am working on in my Managing Human Capital class. The particular challenge of this assignment is that that we have 10 (ten!) people assigned to a relatively small project four questions to a case study need to be squeezed into 8-10 pages write-up and 20 minutes in-class presentation. The very first challenge was to creatively divvy up the work among all of us, so that everyone had their part to contribute. That we managed to do quite efficiently via online collaboration. However now we will have a bigger challenge to tie all these people with their small chunks of work into one cohesive paper/presentation. We already got one discontent voice about how this is going to work.

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PART B IMPORTANCE OF DERIVATIVES

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1.Introduction to derivatives
Concept of derivatives
A derivatives is a product whose value is derived from the value of one or more basic variable called bases of underlying asset in a contractual manner. These underlying assets can be equity,forex,commodity or any other assets. The basic motive behind entering into a derivatives contract is to minimize losses and earn profit by safeguarding against underlions in the price of the underlying assets . this is done by determining or locking in the price of the underlying asset beforehand.

Groth of financial derivatives


Factors driving the growth of financial derivatives are. i. ii. iii. iv. Increased volatility in asset prices in finanacial markets. Increased integration of national financial markets with the international markets Improved and cheaper communication facilities. Sophisticated risk management tools providing a wider choice of risk management strategies.

Derivative products
There are many types of derivatives contracts some most commonly used contracts are. 1.forwards 2.futures 3.option 4.warrents 5.leaps 6.baskets 7.swaps 8.swaptions

Forwards- a forwards contract is a customized contract between two parties,where settlement


takes place on a specific date in the future at todays pre-agreed price.

Futures- future contract is a standardized agreement between two parties to buy or sell an asset at a
certain time in the future at a certain price. PROJECT TITTLE: Importance of derivatives in Indian Market 33

Options-options are rights to buy or sell a given quantity of the underlying assets, at a given price on
or before a given future date. There are two types of options i.call options-these option give the buys the right but not the obligation to buy a given price on or before a given future date. ii.put options-these option give the buyer the rights, but not the obligation to sell a give quality of the underlying assets at a given price on or before a given date.

Warrants-options generally have tenures of up to on year. The majority of options traded on


options exchange have a maximum maturity of nine months longer dated options are called warrants.

Leaps-the acronym LEAPSmeans long term equity anticipation securities.these are option having a
maturities.these are option having a maturity o up to three years.

Baskets-baskets are options or portfoliosnof underlying assets.the underlying asset is usually a


moving average of a basket of assets.

Swaps- swaps are private agreements between two parties to exchange cash flows in the future
according to a pre-arranged formula.they can be commonly used swaps are.

Interest rate swaps- these involve swaping of the interest related cash flows between the
parties in the same currency.

Currency swaps-these involve swapping of both principal and interest between the parties ,with
the cash flows in one direction being in a different currency than those in the opposite direction.

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Swaptions-swaptions are options to buy or sell a swap that will become operative at the expiry of
the options.thus a swaption on a forward swap.

Recever swaption- a receiver swaptions is an option to receive fixed and pay floating.

Payer swaption-a payer swaption is an option to pay fixed and receive floating.

Participants of derivatives markets


There are three types of participents in a derivatives market. They are i.hedgers ii.speculators iii.arbitrogeurs

hedgers-hedgers use then futuresborbderivatives market to reduce or eliminate the risk of price
change of an assets

speculators-specula use the futures markets to earn profit by betting on future movements in the
price of an assets

arbitrageurs-arbitrageurs use the futures market to earn profit by taking advantage of discrepancy
between prices of the same product across different markets.

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Exchange trade and otc derivatives


Depending open the way of trading,there are two types of derivatives. e xchange traded derivatives-as the name suggests,exchange trade of dratives are those deratives products thats are traded via an exchange whereby the exchange acts as an intermediary between the contracting parties.

over the counter (otc) derivativesover the counter derivatives are contracts that are negotiated and traded directlynbetween two parties,without going through an exchange.

NSEs derivatives market


NSE is the largest derivatives exchange in india both in term of volume and turnover.the milestones of the derivatives trading of nse are. derivatives trading on the nse commenced with the standard & poorss CRISIL NSE index 50 s$p CNX nifty index future on june 12,2000 i. trading in index options commenced on june 4,2001 ii.trading in options on individual securities commenced on july 2,2001 iii.single stock futures were launched on November 9,2001.

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Market index
To understand the use and functioning of an index derivatives market,it is necessary to understand the underlying market index.by looking at an index,you know how the market in faring Traditionally,indexs have been used as information sources.in recent years, indexes have come to the forefront owing to the popularity of two financial in struments. i. ii. Index funds Index derivatives.

Index derivatives allow people to cheaply alter & their risk exposure to an index (hedging) and to make forecasts about index movements (speculation).hedging using index derivatives has become a central part of risk management in modern economies.

Index number
An index number is a number is a number which measures the change in a set of values over a priod of time .a stock index represents the change in value of a set of stocks which constitude the index. In precise terms,a stock index number is the current relatives value of a weighted average of the prices of a pre-defined group of equities. It is a relative value because it is expressed relative to the weighted average of prices at some arbitrarily chosen starting date or base period.the starting value or base of the index is usully set to number such as 100 or 1000

Good stock market index


Following are the characteristics of a good stock market index i.It captures the behavior of the overall equity maret. ii.It represents the market correctly iii.It is well diversified

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iv.It is highly liquid

Types of indexes
Most of the commonly followed stock market indexes are of the following two types. i.market capitalization weighted index ii.price weighted index

Market capitalization weighted index-in a market capitalization weighted index,each stock in the index affects the index value in proportion to the market value of all shares outstanding.

Price weighted index-A price weighted index is one that gives a weight to each stock that is
proportional to its stock price

Desirable attributes of an index


Three attributes desirable in a good market index: i. ii. iii. It should capture the behavior of a large variety of portfolios It should include highly liquid stocks It should be professionally maintained

Index derivatives
index derivatives are contracts , which derive their profits,from underlying index.the two most important index derivatives are index futures and index options .index derivatives have some advantages associated with them.let us study those advantages. i. ii. iii. iv. Index derivatives helps institutional and large equity holders in risk hedging purpose Index derivatives helps investor in portfolio hedging irrespective of its composition Stock index is difficult to manipulate because of its limited supply Stock index, being an average, is much less volative than individual stock prices.

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Applications of index
Besides serving as a barometer of the market ,an index has many other application in finance.lets go through these applications. An index is applied in. i. ii. iii. Index derivatives Index funds Exchange-trade fund (ETFs)

Index derivatives
Index derivatives are derative contracts which have a market index as the underlying instrument.the most popular index derivatives contracts in the world are: i. ii. Index futures Index options

The first derivatives contract to be traded on NSEs market was the index futures contracts with the nifty as the underlying .this was foolowed by nifty options,derivatives contracts on sectoral indexes like CNX IT and BANK nifty contracts. Trading on index derivatives was future introduced on CNX nifty junior, CNX 100,NIFTY midcap 50 and mini nifty 50

Index funds
An index fund or index tracker is a collective investment scheme that aims to replicated the movements of an index of a specific financial market.an index fund tries to replicate the index returns. This can be achieved by trying to hold all or representative stocks in the index,in the same proportions as the index.the goal of the index fund is to achieve the same performance as the index it tracks.

For example A nifty index fund would seck to get the some return as the nifty index.since the nifty has 50 stocks, the fund would buy all 50 stocks in the same proportion as they exist in the nifty.

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Future option and Forwards contract


Forwards contract is a customized contract between two parties to buy or sell an assets on a specified date and on a specified time. For example Mr. ajay wants to sell his car for rs. 100,000 after six months and mr. ramesh wants to buy a car after some time .so, they enter into a contract where in mr.ramesh will buy mr.ajays car after six months at a fixed price of rs. 100,000. This whole agreement is a forward contract.

Limitations of forward contract


An investor also encounters some limitations while dealing in forwards contract.let us discuss those limitation i. ii. iii. decentralized trading Illiquidity Counterparty risk

Decentralized trading-forwards contracts are not centrally traded just like a real estate market
you have to find the opposite party for trading

Illiquidity-illiquidity is the state of a security or another assets when it cannot be sold or exchanged
easily for cash without a substantial loss in value

Counterparty risk-counter party risk arrives when either the buyer or seller does not honour his
end of the contract.

Futures- to eliminate the shortcoming in the forwards contract future were designed
A futures contract is an agreement to buy or sell an assets at a specific price. The characteristics of futures contracts are: i. ii. iii. They are standardized They are centrally traded in organized exchanges. They allow price changes before delivery

Futures contract terminology


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It is important to know the terms used in futures contract for your better understanding of its mechanism i. ii. iii. iv. v. vi. vii. viii. Spot price Future price Contract cycle Expiry date Initial margin Contract size Mark to market Maintenance margin

Spot price-spot price is the current market price of the underlying assets. Future price-future price is the price of the underlying asset after a certain time frame. Contract cycle-contract cycle is the period over which a contract trades. The standard futures
contracts on NSE are for one months,two-months and three months expiry cycles,which expire on the last thursday of the month.

Expiry date-expire date is the date on which contract trades.it is a specified in the futures contract
terminates.

Initial margin-initial margin is the minimum amount required to be deposited into the margin
account to enter into a new futures contract.

Contract size-contract size is the amount of asset delivered under one contract. Mark to market-at the end of each trading day,the margin account is adjusted to calculate the
investors gain or loss depending upon the futures closing price.

Options-options contract offers the party the right,but not the obligation ,to buy or sell a securing or
other financial assets.at an agreed upon price durty a certain period of times or on a specific date.

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Application of futures
The information about market factors and non-market factors are the deciding tools for exess returns on securities by a futures investor:let us discuss these tools that measure the risk associated with market and non market factors. Beta of stock measures the sensitivity of a stocks responsiveness to these market factors. Beta of a portfolio measures the sensitivity of a portfolios responsiveness to these market factors Beta is a number describing the relation of its returns with that of the financial market as a whole.let us see an example, If index has a beta of 1 it indicates thate the securitys price will move with the maket.a beta of less than 1 means that the security will be less volatile than the market.10 beta of greater than 1 indicates that the securitys price will be more volatile than the market. Futures hedging- hedging means reducing or controlling risk.hedging can be for buying and selling .a buyer hedge is called long hadge and selling hedge is called short hedge.let us discussed its use with the help of an example. Suppose ,in the market the value of particular security is falling from $270 to $220 . kashif,an investor anticipates a further fall in the price of these shares.he decides to enter into a two-month short futures position at a price of $290 .now if the price security falls further he suffers loss on the value of share but at the same time it will be offset by the profit he makes on short future position. If the share price falls to $210, his futures position will be at profitable position.the loss $60 on security will be countered by profit on futures position. Futures speculation speculation is the process when an investor invests in shares with higher risk in order to profit from anticipated price movement.now let us see how a speculator uses futures in bullish and bearish market Suppose kiran ,anticipates that the value of 100 shares of rs 100 each will go up to rs 110 in two months time.he proves right and earns a profit of rs 1000.the annual returns comes out to 6%. In case he buys futures contracts , the share value is rs 100 and two-months futures price is agreed on rs 106.now ,kiran purcheses 100 futures share by paying margin of rs 2000.at maturity ,the spot price is rs 110. Therefore he earns a profit of rs 40 at an investment of rs 2000.the annual rates comes out to be 12% which is higher than normal trading.

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Similarly let us see what happens in a bearish market.rajiv is expecting fall in the price of shares of XYZ ltd.he minimizes the losses the enters into a four-months futures contrats at a price of shares comes down to rs 270.therefore he has made a profit of rs 30 from futures. Futures arbitrage-in finance ,arbitrage is the practice of taking advantage of the price difference between two or more markets.suppose sahil buys an assets for rs 5 in one market and sell it for rs in another market and make rs 15 as profit ,this is arbitrage. Lets us discuss arbitrage in futures to earn riskless profit with the of an example Krishan has shares of modi mills,which at present traders at rs 1000.he buys one-months futures at 965.to make riskless profit he will enter into these transactions i. ii. iii. iv. v. he will sell the shares at rs 1000 in the spot market. Make the delivery of security Buy futures at rs 965 on the same date. At the time of maturity,the futures prices and the spot price converge.the shares trade at rs 975 Therefore he makes a profit of rs 10 (975-965) on futures and riskless profit of rs 25 on spot position.

In this transaction ,the trader applies two strategies one, trade in futures and second ,trade in spot market.

Application of options
now as you have gained so much information about option markets,let us discuss how an investor can use long and short position in rising and falling market. The various strategies for options application are:

Hedging : have underlying buy puts- an investor buys insurance using put options to protect his
stock or portfolio from the market fluctuations.

Speculation:bullish market-in case of bullish market ,an investor can apply options using
two strategies. i. ii. Buy call option Sell put option

Speculation:bearish-in case you are anticipating a fall in the value of your stock the investor
buys put or sells call again there are two trading strategies to benefit from the down word market movement

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i. ii.

Sell call option Buy put option Summary

A derivative is a products whose value is derived from the value of one or more underlying assests in a contractual manner. There are three types of participants in a derivatives market hedgers,speculators and arbitrageurs. Some commonly used derivatives are forwards,futures.options,warrants,baskets,leaps,swaps and swaptions.these derivatives can either be traded OTC or through an exchange. Some of the features of OTS derivatives markets pose risks to financial market stability, so,these are illegal in india.

OBJECTIVE
This project has been taken for religare securities limited.

The objective of this study is To sell the products of the company such as Demat a/c, commodity a/c, LI ,GI & Mutual Funds. To study the various financial services provided dy religare securities ltd. For equity investor and commodity investors. TO know how will religare make trading easier and better in equity. Advantage of commodities and equity trading. To study the market situation. To apply theoretical knowledge into practical knowledge

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SCOPE OF THE STUDY


The scope of the study is identified after and during the study is conducted. The mainscope of the study was to put into practical the theoretical aspect of the study into real lifework experience

METHDOLOGY
In preparing of this project the information collected from the following sources. Primary data: The Primary data has been collected from Personal Interaction with Finance manager and other staff members. Secondary data: The major source of data for this project was collected through annual reports, profit andloss account of 2 year period from 2011-2013 & some more information collected from internet and text sources.

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LIMITATION
The limitation of the study is Our knowledge regarding the working environment of the organization was very limited so it took us time to understand which work is done in which manner. We were not aware the strategies followed by religare which are different from other organization . we were not given any facility of telecalling so we had to do it from our own pocket. We have been facing the problem to collect the leads. There were problem interacting with customers and convincing them. Each and everyday we used to face many types of customers-some of good behaviors,some of very rudely and aggressive nature.And some customers did not show interest to talk and they used to disconnect the phone. We fed up with the negative responses of the customer. Difficult in convincing people for investment. Difficult to change mind of the invester according to age and profession. Difficult to make an approach to investors. Difficult to take an appointment with professional people. Difficult to get the documents required for formalities from investors Difficult to overcome an impassionate person who wants return in less time. Difficult to follow up the people whose names are being stored in a data. Difficult to remove the fear of risk from the minds of investors. Lack of awareness of share market. Time being a major constraints. Customer base is decreased because of wrong phone numbers and numbers with no reply.

Since the share market has grown to an all time high the peole have second thoughts for investing in INSURANCE and prefer investing in other safer and fixed return deposits deposits such as FDs and government bonds.

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2.PROJECT RATIONALE
- The conservation ratio, an indicator of customer retention, is at 81% and one of the best among private life insurers. - The cost ratio improved by 8 percentage points to 30% in FY 2012. - Shareholders'' profit increased by 137% to Rs.460 crore. Enterprise profit rose by 159% to Rs.733 crore. - At 534%, the Company maintained 3.5 times the stipulated solvency margin. The story is similar for religare Healthcare. The business always had best-in-class hospitals, doctors and patient care facilities. Despite these positives, religare Healthcare was not exhibiting the all-round operational and financial performance that was expected of it. That has changed. A new, highly charged and motivated management team led by Dr. Ajay Bakshi at religare Healthcare working in tandem with the senior management of your Company, has turned things around. Gross revenues increased by 20% from Rs.685 crore in FY 2011 to Rs.823 crore in FY 2012; and the gross contribution margin rose to 59.7%.

3.RECOMMENDATIONS
1.Well known product 2.Easily affordable premium rates 3.High penetration capacity Scope of improvement for religare1.A large untapped market(mainly in urban areas or in metro cities) 2.A well diversified product category. 3.No hassles of Third Party handling.

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4.CONCLUSION
The Market share FactorMarket share of Religare-0.3865% Market share of National Insurance-14% Market Share of United India-14.78% Market share of ICICI Lombard-11% Market share of Bajaj Allianz-3% Market share of Hdfc-3.37%The psu companies has an incredible market share, mainly because of reasons like At the end I would like to conclude that the overall accounting policies of the company are well structured. The background of the company is strong enough to resist the imbalances of the markets as well as the economy. They have been able to manage working capital components efficiently. Against the background of a very challenging business and economic scenario of the country, WGSRL concluded yet another year of satisfying results by improving operating margins significantly. The results of the year 2010-13 shoes that the society is stronger and more efficient and the further shoes a consistent trend towards growth and cost efficiency. During the current year the sales reached the new milestone. Even in some of the quantitative measures like better sourcing of raw materials, productivity or cost of financing, max bupa created new landmarks and the list is growing further.

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BIBLIOGRAPHY
1. Philip Kotler& Hiller (2008) marketing management 8th edition: Pearson 2. OUTLOOK BUSINESS (9TH FEB, 2008) 3. BUSINESS STANDART (18TH FEB, 2008) 4. 4PS OF BUSINESS AND MARKETING (28TH MARCH, 2008) 5. www.http://.scribd.com 6. www.google.com 7. http://www.slideshare.com

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