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1.1 GENERAL INTRODUCTION
PHYSICAL CERTIFICATES - THE TRADITIONAL WAY The Indian capital market has seen an unprecedented boom in its activity in the last decade. We can now boast of a very large investor population and substantial volumes of trade. However, this surge in activity has brought with it, numerous problems that threaten the very survival of the Capital market in the long run. A closer inspection of the problems would reveal that most of them arise due to the intrinsic nature of paper based trading and settlement. This century-old system of trading and settlement requires handling of huge volumes of paper leading to increased costs and inefficiencies. Simultaneously, they expose the investors to greater risks putting them at a disadvantage. Some of these areas are:
Unwarranted delay in transfer of shares. It takes 30 to 60 days for the investors to get the shares lodged in their name; Possibility of forgery on various documents leading to bad deliveries, legal disputes etc; Theft of shares leading to defective title in shares purchased and subsequent litigation; Prevalence of fake certificates in the market; Mutilation or loss of share certificates in transit; Increased transaction costs due to stamp duty, fake shares, rejection by registrars, etc.
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This has made the investors, both retail and institutional, wary of entering the Indian capital market. In this scenario, it was felt that the getting up of a depository and the introduction of scrip less trading and settlement is imperative for the efficient functioning of the market. The Indian capital market has witnessed numerous changes in the recent past. Historically stock market booms have always resulted in a number of problems for the lay investor. Sometimes, the problem may magnify them and threatens to engulf the entire capital market. A close introspection of these problems will reveal that most of them are due to intrinsic nature of paper based trading and settlement. All this may have driven away many potential investors and Foreign Institutional Investors. Dematerialization of shares is looked upon as the remedy for the ‘paper’ based problems.
With effect from august 19, 1998 SEBI has granted certificate of registration of Central Depository Services (I) Ltd. (CDSL). Yet even with demat, from the point of view of investors there are numerous problems. Here Wallet Watch introduces you to setting up of a demat account and introduction of scrip less trading and settlement. There are numerous benefits of this scrip less trading and settlement, which Wallet Watch has discussed in detail.
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2.1 INTRODUCTION ABOUT THE COMPANY
Even as the European and American stock markets reckon with the changes brought about by the Internet and IT/telecom advances, the Indian stock market has quickly moved to global standards. The sheer breadth of the changes since the National Stock Exchange started operations in 1994 and with the Securities and Exchange Board of India (SEBI) also driving the changes in the market system, have enabled the Indian market to move well ahead in just five years. Even as online automated trading and better clearing and settlement mechanisms have been put in place, perhaps, the most significant change in the Indian market has been the coming of paperless trading; it may well be a precursor to the next big changes – rolling settlements and Internet trading. But the push towards paperless trading stands out even in a decade when the market landscape has changed beyond recognition. Dematerialisation (holding and trading securities in paperless mode) was an alien concept in India before 1995; in five years, large quantities of paper have been flushed out of the system. Since the entry of the foreign institutional investors (FIIs) and online trading, the old system, laden with paperwork at every conceivable stage, was out of place in an otherwise fast trading environment. As the FIIs complained about the paperwork as a major constraining factor, the government and SEBI took notice. The requisite legislative changes were put in place quickly - the Depositories Act, 1996 was passed and the NSE, with the UTI and the IDBI, set up the National Securities Depository Ltd (NSDL). But the depository concept did not gain popularity; the FIIs which had clamoured for its introduction, now ignored it. The reason: Lack of liquidity. But, unless the institutional investors stepped in, there could be no liquidity. This stalemate frustrated the push for a paperless environment.
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Until SEBI stepped in, that is. With regulatory pushes SEBI, in phases, made demat trading in stocks mandatory for institutions first and, then, for all investors. Mandatory paperless trading, forced the FIIs to dematerialise their holdings quickly. As a consequence of SEBI's action, most major stocks are traded in the paperless mode now. The second phase will involve some 200 stocks in a few months time. The effect of SEBI's action is evident from NSDL's statistics. A total of 698 companies, with a market capitalisation of Rs. 7,37,300 crores (almost 80 per cent of the market capitalisation of all listed stocks), is enrolled with the NSDL. With 13.65 billion shares in the demat mode, nearly 19 million investor accounts, and securities valued at Rs. 3,96,800 crores ($91 billions) actually dematerialised, the concept of dematerialisation can be said to have taken roots. If the regulatory direction is any indication, more paper will be flushed out of the system in the next two years. The costs of dematerialisation have declined as the NSDL slashed charges as volumes expanded and the competition _ from the Central Depository Services Ltd (CSDL) floated by the BSE _ started in 1999 second half. A series of measures by SEBI and NSDL also helped ease the strain faced by retail investors. From a long-term perspective, demat in India is of considerable significance. Not only has the general trading environment improved and quickened, volumes too have perked up, even in the demat segment. With demat taking off, there is now scope for an improvement in the quality of investor services. As a consequence of dematerialisation, the Indian market is also well prepared for web-based trading though the quality of telecom infrastructure and inadequacies in the banking system-stock exchange linkages may cause delays. Notably, with regard to the thrust towards paperless trading, the Indian market managed in three years what took even the US much longer.
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With a high degree of dematerialisation a reality, the stage is set for rolling settlements and web-based trading. Once these are in place, the Indian market will have moved closer to the standards in advanced markets, such as the US. And paperless trading may well be the catalyst for such a rapid advancement. This is the concluding week of Business Line's 20-week series Markets –a Century in Retrospect, which featured the most significant market- and corporaterelated events. Other, equally significant, specific topics of a micro-nature will be published through the year.
conducted the study of S. Vaidya Nathan and BL Research Bureau
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2.2 HISTORY OF THE ORGANIZATION:
The dematerialized form of shareholding and the depository mode of trade (scrip less trade) have been in operation in developed financial markets for over 15 years. In India, the first depository commenced operation a decade back and is relatively new. The Indian financial market is in need of both scrip-based and scrip less trade, but the investing community, which is used scrip-based trade, is bound to take some time to accept the latter. The scrip less trading, till now a domain of the western world, institutional investors and GDR holders is now mandatory even for small investors. All those who hold physical share certificates have to get them dematerialized. If they do not, they will be forced to do so at the time of sale. The countless numbers of conservative Indians have to digest it, whether they like it or not. First, the institutional investors succumbed. Then the high net worth individuals, trading in more than a certain numbers of shares, were forced to give in. now, it is the turn of the small investors of select-companies. With their share certificates being replaced by small slips and receipts, naturally the average investors will have their share of fears and apprehensions. It is necessary to educate and convince these investors about the benefit of Demat rather than forcing them to take part in the game.
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2.3 Company’s Vision:
To make ICICI Direct the dominant online share trading by world class people and services. This we hope to achieve by: • • • • Understanding the needs of customers and offering them superior product and service. Leveraging technology to service customers quickly and conveniently. Developing and implementing superior risk management and investment strategic to offer sustainable and stable return to our shareholder. Providing and enabling environment to foster growth and learning for our employees
2.4 Company’s mission:
To judged by their sales and earnings growth rates than on the absolute value of their sales and earnings. Look for companies that consistently grow faster than there peers. Investors prefer companies that increase profit margins -- the percentage of sales that they keep -- every year. This is accomplished either by lowering expenses or raising prices. Look for companies that consistently find ways to squeeze more profits out of sales than their peers. The financial health of a company is dependent on a combination of profitability, short-term liquidity and long term liquidity. Companies, which are profitable, but have poor short term or long term liquidity measures, do not survive the troughs of the trade cycle
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2.5 OBJECTIVES OF THE STUDY
Study of ICICI Direct.com (online share trading) Study of dematerialization in ICICI Capital Ltd. Customers satisfaction and awareness of ICICI Capital Services Ltd.
ICICI Capital Services Ltd., is depository participant (DP) and it is providing the financial services to the share holders and various other DP’s also providing almost same services which leads to a competition. So in order to retain the existing customers of ICICI Capital Ltd. and to attract new customers knowing the customers need and preferences and expectation is very important. The study involves knowing the expectation and satisfaction level of ICICI Capital Ltd. customers.
2.6 PRODUCT PROFILE
The dematerialized form of shareholding and the depository mode of trade (scrip less trade) have been in operation in developed financial markets for over 15 years. In India, the first depository commenced operations a decade back and is relatively new. The Indian Financial Markets is in need of both scrip-based trade, but the investing community, which is used to scrip-based and scrip less trade, is bound to take some time to accept the latter. The scrip less trading, till now a domain of the western world, institutional investors and GDR holders is now mandatory even for small investors. All those who hold physical share certificates have to get them dematerialized. If they do not, they will be forced to do so at the time of sale.
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A process by which the physical certificates of an investor are taken back by the company / registrar and actually destroyed and an equivalent number of securities are credited in the electronic holdings of the investor. Offers services to clients dealing in Government securities through the SGL A/C. besides holding the securities, ICICI Capital Services Ltd. Provides records update based on the transactions made by the clients. Collects and credits the benefits and proceeds from sale to the clients’ account; and Supplies periodical reports on the transactions and holding of the clients.
TRADING: Next function activates when an investor buys or sells in the market. Buying: 1. An investor gets order executed and makes payment to the broker. 2. Investor instructs his Depository Participant to expect credit on settlement day. Broker instructs his DP to debit his Clearing Member account on settlement day. 3. Before settlement day Broker makes payment to clearinghouse through Clearing Bank. 4.On settlement day Clearing house releases shares to broker’s Clearing Member account which is then transferred to investors account through NSDL (National Securities Depository Limited). Investor gets credit in his account.
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1. An investor gets order executed.
2. Investor instructs his Depository Participant to debit his account with immediate effect. The shares move from investors account to Brokers Clearing Member account via NSDL. A Broker clearing member accounts is credited.
3. Before settlement day broker transfers shares from his clearing member account to Clearinghouse via NSDL. His account is debited.
4. On settlement day Broker receives payment from clearing house which he passes on to the investor.
ICICIDirect.com is a truly online share-trading site. This means that from the time you punch in a buy or sell trade on your computer to the final settlement in your account, everything happens completely online. The 3-in-1 e-invest account integrates your brokerage, bank and one or more depository accounts to make sure that you can do the otherwise cumbersome share trading from the comfort of your home or office, at absolutely any time of the day…or night.
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HOW CAN ONE OPEN AN ACCOUNT IN DEMAT?
First an investor has to approach a DP and fill up an account opening form. The account opening form must be supported by copies of any one of the approved documents to serve as proof of identity (POI) and proof of address (POA) as specified by SEBI. Besides, production of PAN card in original at the time of opening of account has been made mandatory effective from April 01, 2006. All applicants should carry original documents for verification by an authorized official of the depository participant, under his signature. Further, the investor has to sign an agreement with DP in a depository prescribed standard format, which details rights and duties of investor and DP. DP should provide the investor with a copy of the agreement and schedule of charges for their future reference. The DP will open the account in the system and give an account number, which is also called BO ID (Beneficiary Owner Identification number). The DP may revise the charges by giving 30 days notice in advance. SEBI has rationalised the cost structure for dematerialisation by removing account opening charges, transaction charges for credit of securities, and custody charges vide circular dated January 28, 2005. Further, SEBI has vide circular dated November 09, 2005 advised that with effect from January 09, 2006, no charges shall be levied by a depository on DP and consequently, by a DP on a Beneficiary Owner (BO) when a BO transfers all the securities lying in his account to another branch of the same DP or to another DP of the same depository or another depository, provided the BO Account/s at transferee DP and at transferor DP are one and the same, i.e. identical in all respects. In case the BO Account at transferor DP is a joint account, the BO Account at transferee DP should also be a joint account in the same sequence of ownership.
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2.7 ORGANIZATION STRUCTURE
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Anil Kaul, ceo – Retail Ashish Kaul, marketing & analysist Rajendra Sharma, equity Analysist & MIS Rohit Dhabolkar, marketing & Branding Sanjiv Saraff, product Manager Abhijit Ghosh, Sales zonal heads Dharmesh dixit, project & operation. Prasanan keshavan, Customer service & operation Raman Addanki, Legal risk & Complain Manoj kabra, Audit & cost control. Harendra Kumar, Research Joseph Abraham, HR. Shikha sing, Compensation & Benefits. Sujata kapoor, Talent Management. Aloma Sing, Strategic & Sourcing. Malachi Lopes, HRIS Sanjita Chougle, Payroll. Santosh Nayak, Administration.
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Profile of the Organisation
3.1 DEPARTMENT/FUNCTIONAL AREAS
Infrastructure financing, corporate financing and retail have been the strong pillars of ICICI's growth. They expect these to remain thrust areas in the future too. The financial institution sees significant opportunities in the power sector, and in the rapid deregulation of the Telecom sector. On the retail side, ICICI has established a retail franchisee through a physical presence across 42 cities. Its retail thrust has been on the planks of technology enabled low cost distribution channels like the Internet, Call centers and ATMs. It occupies the number one position in automobile financing (over 20% of the market share), number one in credit cards on an incremental basis. It also has a growing presence in home finance and on-line trading. ICICI BANK ICICI Bank is a commercial banking outfit set up by the ICICI Group. The Bank was registered a banking company on January 5th, 1994 and received its banking license from the Reserve Bank of India on May 17th, 1994. The Bank has an authorized capital of INR 300crore (USD 75.96 million), of which subscribed and paid-up capital is INR 165 crore (USD 41.78 million). The first ICICI Bank branch was started in Madras in June 1994. The branches are fully computerized with state-of-the-art technology and systems. All of them are fully networked through V-SAT (Satellite) technology. The Bank is connected to the international SWIFT network since March 1995. ICICI Bank offers a wide spectrum of domestic and international banking services to facilitate trade, investment, cross-border business, and treasury and foreign exchange services. This is in addition to a whole range of deposit services offered to individuals and corporate bodies. ICICI Bank’s Infinity was the first Internet banking service in the country, and a prelude to banking in the next millennium. Currently the Bank has around 150,000 customers.
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CICI VENTURE FUNDS MANAGEMENT COMPANY LIMITED
With the recent spurt in entrepreneurship in the country, venture capital and private equity capital financing are fast attaining a role of prominence. Uniquely positioned to take the Indian entrepreneur further is ICICI Venture Funds, the wholly owned subsidiary of ICICI, with its keen understanding of the Indian Financial Markets, entrepreneurial ethos, access to global capital and a network through influential global alliances. Strong parentage and affiliates provide ICICI Venture with access to a broad spectrum of financial and analytical resources. An affiliation with (Trust Company of the West) provides a platform for networking Indian Companies to global markets and technology. ICICI Venture Funds currently manages / advises 11 Funds aggregating US$ 400 million, making it the most significant private equity investor in the country. The investment experience of ICICI Venture’s professionals is the foundation its strengths and success in several areas of investing. ICICI Venture seeks to invest in opportunities where its network through ICICI and TCW can create value for all involved. ICICI Venture’s primary investment objective is capital investment through investments by way of equity or equity-related securities in unlisted companies with significant growth potential. ICICI Venture’s investments span a broad spectrum of industries and stages of development, the investment focus being on
• • • •
Information Technology Biotechnology and Life Sciences Media and entertainment Retail Services
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ICICI SECURITIES AND FINANCE COMPANY LIMITED Formed in 1993 when ICICI’s Merchant Banking Division was spun off into a new company, I-SEC today are India’s leading Investment Bank and one of the most significant players in the Indian capital markets. Its client list includes some of the best known, most respected names in Indian business and industry, and I-SEC offers them what are probably the widest, most in-depth range of services in the market, with the highest standards of professionalism. Backed by a strong distribution network, I-SEC is acknowledged to be at the forefront of all new developments in the Indian debt market. ISEC Research Reports, Compendia, Updates, I-BEX and sovereign Bond Index, have become industry standards, sought after by finance, business and reputed publications alike. The Project Finance Group has helped take strategic projects from the drawing board to financial closure, leveraging the expertise of parent organization. I-SEC has also executed several assignments in M & A, including business valuations, spin-offs and mergers, for both domestic and overseas clients. The range of products offered by i-SEC includes:
• Corporate Finance – Mergers and Acquisitions, Equity, Bidding (especially for Telecom Projects)
• Fixed Income – Primary Dealership, Debt Research
• Equities – Lend management, Underwriting, Syndication, Private Equity placement, Sales, Trading, Broking, Sectoral and Company Research I - SEC Continues to sustain a steady rate of growth by offering the most extensive range of services combined with unrivalled standards of professionalism.
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ICICI BROKERAGE SERVICES LIMITED
Set up in March 1995, ICICI Brokerage Services is a 100% subsidiary of I-SEC. It commenced its securities brokerage activities in February 1996 and is registered with the National Stock Exchange of India Limited and The Stock Exchange, Mumbai. We are a joint venture between ICICI and the leading financial services provider in India, and prudential plc of U.K., one of the finest Life insurance companies in the world. Together we provide you with an extensive range of insurance products to suit your various needs at various life stages. We aim to keep you covered, at every step in life. Their policies are need-specific and address particular age groups. This means that no matter where in life you are, we offer specific products to suit your needs for savings, protection and retirement. Our products can be categorized into the following:
• Saving plans • Protection plans • Retirement plans
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ICICI PERSONAL FINANCIAL SERVICES LIMITED ICICI Personal Financial Services Limited (ICICI PFS), formerly ICICI-Credit, was one of the first four companies to obtain registration as a Non-Banking Financial Company (NBFC) from the Reserve Bank of India (RBI) on September 10, 1997 under the new section 45IA of the Reserve Bank of India Act, 1934. During the year 1998-99, there was a significant shift in the Company’s operation from leasing to hire purchase to distribution and servicing of all rental products for the ICICI Group. It is now a focal point for marketing and distribution of all rental asset products for ICICI, including auto loans, consumer durable finance and other financial products. The Company has thus become part of ICICI’s retail strategy aimed at offering a comprehensive range of products and services to retail customers. In view of this reorientation of the business, the name of the Company was changed from ICICI Credit Corporation to ICICI Personal Financial Services Limited (ICICI PFS) effective March 22, 1999.
ICICI CAPITAL SERVICES LIMITED
ICICI Capital Services Ltd. was incorporated in the name of SCICI Securities Ltd. on September 24, 1994 as a wholly owned subsidiary of erstwhile SCICI Ltd. with the objective of providing stock broking services to the institutional clients and undertaking activities such as underwriting, primary market placements & distribution industry & company research etc. After the amalgamation of SCICI with ICICI effective from April 1, 1996, resulting in the change of the name. The company is mandated, under review by ICICI, to carry out on its behalf the retail resource raising activities and to provide front office services related to all retail and semi retail liability products of ICICI. The company also operates the network of ICICI Centers being set up by ICICI. As on date the company has set up 91 centers across the country.
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ICICI InfoTech is a leading provider of end-to-end IT solutions. We have an in-depth experience of having worked on varied technologies with leading corporations worldwide. Our service portfolio includes the following:
IS & IT Consulting Software Design and Development Enterprise Application Integration Value Chain Management Solutions (SCM, CRM etc.) Application Re-engineering and Management Knowledge Management Solutions Embedded System Applications Technology Incubation, IT-enabled Services & IT Outsourcing
ICICI Capital Ltd.
Its products are RBI Bonds E-invest (ICICI Direct.com) Fixed Deposits Mutual Funds Bonds Demat Equity IPO
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ICICI DIRECT.COM (ONLINE SHARE TRADING):
ICICI Direct.com is a truly online share-trading site. Which means that from the time you punch in a buy or sell trade on your computer to the final settlement in your account, everything happens completely online? The 3-in-1 e-invest account integrates your brokerage, bank and one or more depository accounts to make sure that you can do the otherwise cumbersome share trading from the comfort of your home or office, at absolutely any time of the day or night
3.2 PERFORMANCE AND OPERATIONS
The Sales turnover of the Company during the year was Rs.2,602 million. There is a decrease of 4% from the previous year. Decline in the sale of Carburettors for two wheelers and four wheelers had contributed to the overall sales downturn though the Company has improved the sale of MPFI parts to passenger cars. The profit after tax of the Company for the year under review is Rs.377 million Due to inclusion of an extraordinary profit of Rs.250 million on sale of investments, the Profit after Tax has registered an increase of 42% compared to previous year. The profit from the manufacturing activities of the Company is lower mainly due to a. price reduction offered to customers b. increase in the input and raw materials cost c. a particular customer in the two wheeler market witnessed a steep decline in the sale of a model for which UFSL is supplying the Carburettors Key Ratios 2005-06 2004-05
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Net Profit Ratio (PAT/Sales) 14.49 9.49 Net Profit Ratio (PAT/Net worth) 22.21 18.13 Current Ratio (Current Assets/Current Liabilities) 1.67:1 2.55:1 Debt - Equity Ratio 0.47:1 0.04:1 Debtors Turnover (Debtors/Gross Sales) 1.18 Months 1.25 Months Creditors Turnover (Creditors/Purchases)1.86 Months 1.59 Months Dividend Pay-out Ratio 17 15.37 . 3.3 SWOT ANALYSIS OF THE COMPANY: Strengths 1. Management philosophy and commitment to maximize shareholders returns 2. Upgraded product design and development facilities to develop new products and aid diversification 3. Ongoing activities to support up gradation of operational performance and rise in productivity 4. Team of talented and committed professionals available to improve companies performance Weakness 1. Competition from cheap imports 2. Low customer base
1. UFSL has initiated development of products for diesel application. This will provide tremendous scope for diversification and growth 2. Acquisition of AMTEC to provide opportunities to access global OEMs 3. Opportunity to support AMTECs operations by supplying products from India 4. The introduction of new emission norms will provide UFSL opportunity to develop injection systems and thereby upgrade the status of the company from product to system supplier.
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Threats, Risks & Concerns
1. Constant pressure to be cost competitive to meet customer expectations 2. Relentless pressure to maintain profitability due to rising input/raw material prices 3. Increasing popularity of alternative fuel vehicles, such as Hybrid, Hydrogen powered, CNG and LPG vehicles poses new challenges for the company .
3.4 FUTURE PROSPECTS AND PLANS OF THE ORGANIZATION
For ICICI the past half has been a trying period more so because of the adverse environmental conditions such as the depressed equity markets and the volatile currency markets. However, its retail thrust and a perceptible shift in financing from manufacturing projects to corporate finance will put it in good stead for the quarters to come. Its growing importance in the telecom and infrastructural sectors, which have huge potential, will be a key driver of growth for the future
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3.5 ACHIEVEMENT AND AWARD
Winning is a habit that is assiduously cultivated at ICICI Securities Limited (i-SEC). Be it deals, mandates or awards, we manage them all in our quite and efficient way. For us winning awards is a matter of pride and honour. Each new award is a manifestation of our hard work and commitment to our clients. Since inception, i-SEC’s expertise has been time and again widely recognized by both domestic and international agencies. Our Fixed Income team for the last two years (CY 2004 and 2005) has been adjudged the “Best Bond House” in India by both Asiamoney and Finance Asia. The equities team was adjudged the ‘Best Indian Brokerage House-2003’ by Asiamoney. The Corporate Finance team, according to Bloomberg topped the M&A league tables in 2003.
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4.1 STATEMENT OF THE PROBLEM
Online trading and Demat are the two emerging concepts in the stock market. It involves personal factors, technical factors, business factors and economic factors. The interplay of these factors on stock market requires a deep study about the pattern process and procedures and performance. This study is intended to identify the various concepts about demat and the online trading and its way of functioning ICICI provisions are not exposing to its customers extensively. Hence in this report an attempt has been made to link the potential customers and the ICICI Direct .Com
4.2 OBJECTIVES OF THE STUDY
Every company has a particular goal. A study without objectives can not reach the destination. My project work programme was also directed to some particular targets and the main objective of the study are as bellow; Study of ICICI Direct.com (online share trading) Study of dematerialization in ICICI Capital Ltd. Customers satisfaction and awareness of ICICI Capital Services Ltd.
4.3 SCOPE OF THE STUDY:
Globalization of the financial market has led to a manifold increase in investment. New markets have been opened; new instruments have been developed; and new services have been launched. Besides, a number of opportunities and challenges have also been thrown open.
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RESEARCH DESIGN OF THE STUDY
The study is based on survey technique. The study consists of analysis about customer’s awareness and satisfaction of ICICI Capital Ltd. For the purpose of the study customers 100 are picked up and their views solicited on different parameters. The methodology adopted includes
Questionnaire Random sample survey of customers Discussions with the concerned
Personal interviews and informal discussions were held with ICICI Capital Ltd. customers to ascertain the awareness and satisfaction level. Further applying simple statistical techniques has processed the data collected. SOURCES OF DATA :
Primary data: Questionnaire
Secondary data: are published materials such as periodicals,
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journals, news papers, and website.
Sampling since segment wise investors in ICICI Capital Ltd. are not available for the overall customers was considered for the study. 100% coverage was difficult within the limited period of time. Hence sampling survey method was adopted for the purpose of the study.
Population: (universe) customers of ICICI Capital services Ltd.
Sampling size: A sample of hundred was chosen for the purpose of the study. Sample considers of small investor, large investors and traders of ICICI Capital Ltd.
Sampling Methods: Probability sampling requires complete knowledge about all sampling units in the universe. Since due to time constraint non-probability sampling was chosen for the study.
Sampling procedure: From large number of customers of ICICI Ltd. were randomly picked up.
Field Study: directly approached respondents.
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4.4 DATA COLLECTION INSTRUMENT
COLLECTION OF DATA THROUGH QUESTIONNAIRES: The data collected for the study purpose is through questionnaires. Hundred customers of ICICIdirect.com have been selected randomly for the study purpose and then the information revealed from the customers is analyzed and interpreted in the study.
ORGANISATION OF FIELD WORK
Initial field work has done for pre testing tools for data collection. The data is collected through the direct interaction with the ICICI’s customers through questionnaires answered by them. hundred customers of ICICI were randomly chosen for the purpose of the study in Bangalore .
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4.5 LIMITATION OF STUDY
Since sample size is only 100, which is not a true representative of the population as a whole.
Since segment wise investors is not available in ICICI Capital Ltd. Overall concept is taken for the study.
Information is partly based on secondary data and hence the authentic of the study can be visualized and is measurable.
Level of accuracy of the results of research is restricted to the accuracy level with which the customers have given their answers and the accuracy level of the answers cannot be predicted.
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DATA ANALYSIS AND INTERPRETATION
Table No. 5.1 Customers’ preference over other depository services in ICICI Direct.com Attributes Quality Service Safety Reach Vast variety of Service Nothing in Particular No. of Persons 50 20 12 4 14 Percentage 50 20 12 4 14
Chart No. 5.1 Percentage of customers’ preference over other depository services in ICICI Direct.com.
14% 4% 12% 50% 20%
Q u a lit y S e r v ic e S a f e t y
R e ach
V a s t v a r ie t y o f S eNr v ic ein g in P a r t ic u la r o th
From the above showing statistics it is observed that in the survey 50% customers justify that ICICI capital Ltd. providing quality services as compare to other depository services
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Table No. 5.2 Different types of investors having ICICI Direct.com.
Small Investors 58
Long term investors 32
Chart No. 5.2 Percentage of investors having ICICI Direct.com.
S m a ll I n v e s t L o s g t e r m in v e s tr o r se s orn T ad
The above table shows that out of 100 customers, 58 customers are small investors and 32 customers are long term investors.
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Table No. 5.3 Number of availed of the services in ICICI Direct.com. Schemes/Services ICICI Direct.com Settlement Transmission of Securities New Services Sell 'N' Cash Mutual funds 5 31 5 31 No of Persons 32 9 23 Percentage 32 9 23
Chart No. 5.3 Percentage of availed of the services in. ICICI Direct.com
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ICICIDirect.com 5% 9% 32% Settlement Transmission of Securities Sell 'N' Cash 31% Mutual funds
Table No. 5.4 Number of customers aware of services offered by ICICI Ltd. Schemes/Services ICICIDirect.com Settlement Transmission of Securities New Services Sell 'N' Cash Mutual Fund Loans Against de-mat shares 56 18 24 56 36 48 No of Persons 100 70 64 Percentage 100 70 64
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Chart No. 5.4 Percentage of customers aware of services offered by ICICI Capital Ltd.
No of Persons
ICICIDirect.com Settlement 26% Transmission of Securities Sell 'N' Cash 15% 17% 19% Mutual Fund Loans Against demat shares
Table No. 5.5 Customer’s awareness of the new services offered by ICICI Direct.com Through ICICI Direct.Com 50 50% News Paper/ Broker Magazines 10 10% 8 8% Agents 32 32% Others 0 0
Chart No. 5.5 Percentage of customer’s awareness of the new services offered by ICICI Direct.com
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6% 34% 34%
Through ICICI Ltd.
According to the survey 50% customers know the services through ICICI and 32% through ICICI agent
Table No. 5.6 Customer’s first source of awareness Through ICICI Direct.Com 34 34% News paper Magazines 12 12% / Broker 14 14%
Through ICICI Direct.Com News paper / Magazines Chart No. 5.6 Percentage of customer’s first source of awareness 34% 34% Broker Agents 14% 12% Others 6%
Agents 34 34%
Others 6 6%
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According to the survey the first source of information is ICICI Direct.Com itself and the agents.
Table No. 5.7 Customers’ satisfaction of the services of ICICI Direct.Com Mostly Satisfied 24 24% 24%
Satisfied 64 64%
Neither Satisfied Unsatisfied 2% 10
Mostly Unsatisfied 2 2%
Unsatisfied 0 0
Chart No. 4.7 Percentage of customers’ satisfaction of the services of ICICI Direct.Com 64%
S a t i s f ie M o s t ly S a t i s Nie w i t h e r S a t i s f i e d / U n s oa s isl y i e d s a t i U ni s a t i s f ie d d f ed M t t f Un sf ed
According to survey 64% of customers are satisfied with the services of ICICI Direct .com and 24% are mostly satisfied. Then we can say that ICICI Direct.Com offers quality service that touches customers’ satisfaction level.
Table No. 5.8 Customers’ satisfaction of the Demat services of ICICI
Satisfied 46 46%
Mostly Satisfied 22 22%
Neither Satisfied Unsatisfied 16 16%
/ Unsatisfied 12 12%
Mostly Unsatisfied 4 4%
Chart No. 5.8 Percentage of 4 % customers’ satisfaction of the Demat services of ICICI Direct.Com 6 % 46% 1
22% S a t is f ie d U n s a t is f ie d
M o s t ly S a tis f ie d
N e i t h e r S a t i s f i e d / U n s ao isstfliye U n s a t i s f i e d M t d
According to the survey 46% are satisfied with the Demat Services of the ICICI Capital Ltd. 12% of the customers are not satisfied. So we can say ICICI Direct.Com offers quality services in Demat section also.
Table No. 5.9 Customers’ satisfaction with the purchase and sales of ICICI Direct.Com Mostly Satisfied 26 Neither Satisfied/ Unsatisfied 14 Mostly Unsatisfied 8
Satisfied 40 40%
Unsatisfied 12 12%
Chart No. 5.9 Percentage of customers’ satisfaction with the purchase and sales of 26 ICICI Direct.Com %
S a ti sfi e d U n sa tisfie d
M o stly S a ti sfie d
N e i t h e r S a ti s f i e d / U M s asttils fi U n s a t i s fi e d n o y ed
According to the survey only 40% of the customers are satisfied with Purchase and Sales of ICICI Direct.Com. So we can say purchase and sales section ICICI Direct.Com unsatisfied the customers.
Table No. 5.10 Customers’ satisfaction with the transmission of securities of ICICI Direct.Com Mostly Satisfied 22 22% Neither Satisfied/ Unsatisfied 32
Satisfied 30 30%
Mostly Unsatisfied 12 12%
Unsatisfied 4 4%
Chart No. 5.10 Percentage of customers’ satisfaction with the transmission of securities of ICICI Direct.Com 32% 22%
S a t is f i e M o s t ly S a t is Nf iee it h e r S a t is f i e d / U nM a tsi s lyieUdn s a t is n ie a t i s f ie d d d so tf Ufs d
According to the survey 30% of the customers are satisfied and 22% of the customers are mostly satisfied with the transmission of securities of ICICI Direct.Com. So we can say that ICICI Direct.Com unsatisfied the customers in case of transmission of securities of the customers.
Table No. 5.11 Customers’ satisfaction with the sell of their securities in cash Mostly Satisfied 20 20% Neither Satisfied/ Unsatisfied 10 10%
10% 0% 0%
Satisfied 70 70%
Mostly Unsatisfied 0 0
Unsatisfied 0 0
20% Chart No. 5.11 Percentage of customers’ satisfaction with the sell of their securities in cash
S a t is f ie d o s t ly S a t is fNie d h e r S a t is f ie d / U n sM tois ft ie dU n s a t isUfn sda t is f ie d M e it a s ly ie
According to the survey 70% of the customers are satisfied with the sell in cash system of ICICI Capital Ltd. So we can say that ICICI Direct.Com satisfied the customers with the sell of customers’ securities in cash.
Table No. 5.12 Customers’ satisfaction with the mutual fund service of ICICI Capital Ltd. Mostly Satisfied 34 34% Neither Satisfied/ Unsatisfied 24 24% Mostly Unsatisfied 4 4%
Satisfied 38 38%
Unsatisfied 0 0
Chart No. 5.12 Percentage of customers’ satisfaction with the mutual fund service of ICICI Capital Ltd.
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S a tis f ie dM o s tly S a tis f N edith e r S a tis f ie d / U n s M tiss ftly dU n s a tis Uie s a tis f ie d ie a o ie f nd
According to the survey, 38% of the customers are satisfied with the Mutual fund services of ICICI Capital Ltd. So we can say that customer’s tendency is that they believe that Mutual Fund and Shares are performing as the same in the primary and secondary market and the mutual fund is the safest way to invest in the market.
Table No. 5.13 Customers’ satisfaction with the trading demos provided by the ICICI Capital Ltd. Mostly Satisfied 24 24%
Satisfied 52 52%
Neither Satisfied/ Unsatisfied 20 4% 0% 20%
Mostly Unsatisfied 4 4%
Unsatisfied 0 0
% Chart No. 5.13 Percentage of customers’5 2satisfaction with the trading demos provided 2 4 % ICICI Capital Ltd. by the S a ti sfi e d U n sa ti sfi e d M o stl y S a ti sfi e d
N e i th e r S a ti sfi e d / U n saM o stl y U n sa ti sfi e d e ti sfi e d
According to the survey 52% of the customers are satisfied with the Trading Demos that are conducted by the ICICI Capital Ltd. 24% are mostly satisfied. So we can say that ICICI customers are attending the demo programmes and the ICICI employees can able to solve the queries of the customers.
Table No. 5.14 Customers’ satisfaction with the periodic receipts and holding statements of ICICI Direct.Com Mostly Satisfied 18 18%
Satisfied 20 20%
Neither Satisfied/ Unsatisfied 16 16%
Mostly Unsatisfied 32 32%
Unsatisfied 14 14%
Chart No. 4.14 Percentage of customers’ satisfaction with the periodic receipts and holding statements of ICICI Direct.Com
S a t i s f i e M o s t l y S a t i s N iee it h e r S a t is f i e d / U n M a tsist lfyi eUdn s a t is n ie a t is f i e d d f d so Ufs d
According to the survey, the 20% customers are satisfied and 18% customers are mostly satisfied with the periodic receipts and holding statements of the ICICI Direct.Com. So, we can say that most of the customers are unsatisfied with this service of ICICI Direct.Com.
Table No. 5.15 Customers’ satisfaction with the telephonic enquiries of ICICI Capital Ltd. Mostly Satisfied 48 48% Neither Satisfied/ Unsatisfied 12 12% Mostly Unsatisfied 14 14%
Satisfied 16 16%
Unsatisfied 10 10%
Chart No. 5.15 Percentage of customers’ 16% satisfaction with the telephonic enquiries of 10% 14% ICICI Capital Ltd.
S a tisfie d Unsa CITY COLLEGE tisfie d
M ostly S a tisfie d
Ne ithe r S a tisfie d/ Unsa tisfieM ostly Unsa tisfie d d
According to the survey, 48% of the customers are mostly satisfied and 16% of the customers are satisfied. So, we can say that most of the customers are satisfied with the telephonic service of ICICI Capital Ltd.
Table No. 5.16 Customers’ satisfaction with the co-operation by the staff of ICICI Capital Ltd. Mostly Satisfied 46 46% Neither Satisfied/ Unsatisfied 4 4% Mostly Unsatisfied 14 14%
Satisfied 32 32%
Unsatisfied 4 4%
Chart No. 5.16 Percentage of customers’ satisfaction with the co-operation by the staff of ICICI Capital Ltd.
14% 4% 4% 32%
S a t is f ie M o s t ly S a t is Nie it h e r S a t is f ie d / U n sMa o is tf ly d n s a t isUfn s d t is f ie d d f ed t s ie U ie a
According to the survey, 32% of the customers are satisfied and 46% of the customers are mostly satisfied with the co-operation by the staff of ICICI Capital Ltd. So, we can say that most of the customers are satisfied with the co-operation by the staff of ICICI Capital Ltd.
Table No. 5.17 Customers’ satisfaction with the tariff structure of ICICI Direct.Com Very High 12 12% High 14 14% Reasonable 72 72% Low 2 2% Very Low 0 0
Chart No. 5.17 Percentage of customers’ satisfaction with the tariff structure of ICICI Direct.Com 0% 12% 2%
V e r y H ig hH ig h R e a s o n a b le o w V e r y L o w L
According to the survey, the tariff structure of ICICI Direct.Com is reasonable. Customers told me that the brokerage of 0.75% is reasonable because it is the only organization which deals with the primary and secondary market both. ICICI Direct.Com also has many investment options than any other organization.
Table No. 5.18 Customers’ satisfaction when dealing with the problems through ICICI Direct.Com Schemes / Services Frequent reminders are given to ICICI Direct.com for update the information Irregular receipt of Holding / Transaction statements Improper format of Holding / Transaction statements Improper attention given to the enquiries Billing problem No of Persons 24 22 16 14 10 Percentage 24% 22% 16% 14% 10%
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According to the survey, 12 persons are not satisfied with the frequent reminders which are given to the ICICI Direct.Com for update the information, 11 persons are not satisfied with the irregular receipt of holding or transaction statement, 8 persons are not satisfied with the format of holding or transaction statements, 7 persons are not satisfied attention given to the enquiries, 5 persons are not satisfied with the billing system and 7 persons are not satisfied with the information provided by the ICICI Direct.Com. So, we can say that these systems should be changed or modified by the ICICI Direct.com.
Table No. 5.19 Customers’ rating of the services of ICICI Direct.Com
0 0% 0
0 20% 0
18 40% 36%
28 60% 56%
4 80% 8%
0 100% 0
Chart No. 5.18 Percentage of customers’ rating of the services of ICICI Direct.Com
According to the survey 56% of the customers said that ICICI Direct.Com services are providing only 60% of its services to its customers. So we can say that ICICI Direct.Com services should be increased to please its customers.
Table No. 5.20 Customers’ preference for ICICI Direct.Com over its competitors Quality Service 52 52% Rates charged 10 10% Nothing Particular 24 24% in Safety 8 8% Reach 6 6%
Chart No. 5.19 Percentage of customers’ preference for ICICI Direct.Com over its 8 6% competitors %
Q u a lit y S e r v ic e t e s c h a r g e d t h in g in P a r t ic S a f re t y R e a c h Ra No u la CITY COLLEGE
According to the survey 52% of customers justify their preferences for ICICI Direct.com for quality services, 10% for rates charged and 8% for safety. So, we can say that ICICI Direct.Com provides quality services than its competitors. But in case of rate charges and safety ICICI Direct.Com is behind its competitors.
Table no. 5.20 Customers’ awareness of the products of ICICI Capital Ltd. Products ICICI Bonds ICICIDirect.com Mutual Fund Equity IPO Fixed Deposit RBI Bonds Tick 100 90 78 74 88 82 % 100 90 78 74 88 82
Chart No. 5.21 Percentage of Customers’ awareness of the products of ICICI Capital Ltd.
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ICICI Bonds Equity IPO
ICICIDirect.com Fixed Deposit Mutual Fund RBI Bonds
According to the survey most of the people know all the products of ICICI Capital Services Ltd. Only the customers do not know few products. 100% awareness is feasible in case of ICICI Bonds and 90% in case of ICICI Direct.com.
FINDINGS & CONCLUSION
ICICIdirect.com customers are more satisfied with the quality services. Holding securities in electronic form gives some far-reaching advantages to the investors. ICICIdirect.com offers a wide choice of products for investing in the stock market. It allows to invest in shares, mutual funds and other financial products. With ICICIdirect.com one can manage own de-mat and bank accounts directly and independently. The depository participant will allow an investor to trade through any broker of
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his choice registered with the stock exchanges connected with National Securities Depository Ltd, what will have to provide the details of investor’s account with Depository Participant. Investor can click to get online information on their open orders and traders i.e. orders that are routed to exchange are waiting in the queue to be executed can be viewed for their status. Transaction details for the traders done in the last month are available online. Printed account statements too are available for earlier.
Some customers feel that they are trained for ICICI Direct.Com demo. Many customers feel that batch of 15 are good for ICICI Direct.Com training. Survey reveals that most of the customers are not aware of the service of the Mutual Fund. ICICI Capital Services Ltd. and the normal tendency of the customer are both investing in shares and in Mutual Funds are one and the same. So for this ICICI Capital Services Ltd., should create an awareness of what exactly mean by Mutual Funds and all other services of ICICI Capital Services Ltd. After getting the printouts of the holding statement, dispatch of the same should be taken place with no delay and this can be cross verified with the sender (dispatch section).
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Customers are facing over crowding, non-availability of telephone lines, so proper measures should be taken to overcome these problems. The ICICI official should conduct regular training demo classes for the new account holders.
• • Icici direct.com is performing very well in the field of online share trading business and having very good administration also. Each departments doing their job very well comparing to the standard performance fixed by the management and it leads to overall good performance of the company. • • There existing a good relationship between employees and management The management taking keen interest for finding their weakness and try their level best to overcome this weakness
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Books and journals:ICICIdirect.com broachers and leaflets Periodical published by ICICI Capital Ltd. Journals published by ICICI Capital Ltd.
Websites:www.hinduonnet.com/businessline/iw/2001/05/27/stories/07276053.htm www.cdslindia.com/FAQ/demat.htm www.nsdl.co.in/services/demat.php www.sebi.gov.in/faq/faqdemat.html
Name:-…………………………………………… E mail:………………………………………….
1) How do you justify your preference for ICICI Capital Ltd. over other Depository Services? o Quality Service o Reach o Nothing in Particular
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o Safety o Vast variety of Service
2) What are the different types of investors having. ICICI Direct.com? o Long term investors
o Small Investors o Traders
3) In which scheme are you holding your shares in ICICI Direct.com.? o ICICIDirect.com o Transmission of Securities o Mutual funds o Settlement o Sell 'N' Cash
4) Do you aware the services offered by. ICICI Direct.com? o ICICIDirect.com o Transmission of Securities o Mutual Fund o Settlement o Sell 'N' Cash o Loans Against de-mat shares
5) If you are aware of the new services offered by ICICI Direct.Com then how did they come to know about it? o Through ICICI Direct.Com o Broker o Others 6) If you are not aware of the new services then who / what do you think should be the first source of information? o Through ICICI Direct.Com o News Paper/ Magazines
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o News Paper/ Magazines o Agents
o Broker o Others
7) Are you satisfied with the services of ICICI Direct.Com? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied 8) Are you satisfied with the Demat services of ICICI Direct.Com? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied o Mostly Satisfied o Mostly Unsatisfied o Mostly Satisfied o Mostly Unsatisfied
9) Are you satisfied with the purchase and sales of ICICI Direct.Com? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied 10) Are you satisfied with the transmission of securities of ICICI Direct.Com? o Satisfied o Neither Satisfied / Unsatisfied o Mostly Satisfied o Mostly Unsatisfied
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o Mostly Satisfied o Mostly Unsatisfied
o Unsatisfied 11) Are the customers satisfied with the sell their securities in cash? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied 12) Are the customers satisfied with the Mutual Fund service of. ICICI Direct.com? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied o Mostly Satisfied o Mostly Unsatisfied o Mostly Satisfied o Mostly Unsatisfied
13) Are you satisfied with the trading demos provided by ICICI Direct.com.? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied 14) Are you satisfied with the periodic receipts and holding statements of ICICI Direct.Com? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied 15) Are the customers satisfied with the telephonic enquiries of ICICI Direct.com?
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o Mostly Satisfied o Mostly Unsatisfied
o Mostly Satisfied o Mostly Unsatisfied
o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied
o Mostly Satisfied o Mostly Unsatisfied
16) Are the customers satisfied with the co-operation by the staff of ICICI Direct.com.? o Satisfied o Neither Satisfied / Unsatisfied o Unsatisfied o Mostly Satisfied o Mostly Unsatisfied
17) Are the customers are satisfied with the tariff structure of ICICI Direct.Com? o Very High o Reasonable o Very Low o High o Low
18) Overall how the customers rate the services of ICICI Direct.Com? o 0% o 40 % o 80 % o 20 % o 60 % o 100 %
19) How do the customers justify their preference for ICICIDirect.com over its competitors? o Quality Service o Nothing in Particular o Safety o Rates charged o Safety
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20) Are the customers aware of the following products of ICICI Direct.com.? o ICICI Bonds o Mutual Fund o Fixed Deposit o ICICIDirect.com o Equity IPO o RBI Bonds
21) Have the customers faced any problem while dealing through ICICI Direct.Com or customers are unsatisfied with the below mentioned schemes / services? o Frequent reminders are given to ICICI Direct.com for update the information o Irregular receipt of Holding / Transaction statements o Improper format of Holding / Transaction statements o Improper attention given to the enquiries o Billing problem o Inadequate information
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