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CHAPTER – I INTRODUCTION CHAPTER – II ORGANISATION PROFILE Company Profile Vision History
Organization Structure And Chart
Board Of Directors
CHAPTER – III WEALTH MANAGEMENT Introduction Meaning Wealth Management In India Wealth management And Various Fields Wealth Management In IDBI Bank IDBI Capital Ltd.
Equity & Mutual Funds Advantages Limitations
ANALYSIS AND INTERPRETATION SWOT ANALYSIS CONCLUSION SUGGESTIONS AND RECOMMENDATIONS
PROJECT TITLE A study of Wealth Management at IDBI Bank Ltd.& Customer Perception towards portfolio Management
To understand the concept of Banking Industry in India To explain the profile of IDBI Bank Ltd. To understand various aspects of Wealth Management To understand Wealth Management at IDBI Bank. Ltd. To have a customers’ perspective about Wealth Management at IDBI Bank. Ltd.
To understand the significance of various Banking operations Carry out a SWOT Analysis for getting customers’ insight on Wealth Management
and includes: • Issue of banknote (promissorynote) issued by a banker and payable to bearer on demand) Processing of payments by way of telegraphic transfer EFTPOS internet banking or other means. as most banks offer insurance services (and now real estate services) to their clients. bancassurance is prevalent. with countries such as Iceland. In some countries such as Germany. Its primary activities include providing financial services to customers while enriching its investors. WIDER COMMERCIAL ROLE The commercial role of banks is not limited to banking. Many financial activities were allowed over time. banks have historically owned major stakes in industrial corporations while in other countries such as the United states banks are prohibited from owning non-financial companies. having relatively light regulation of the banking sector. banks are usually the nexus of a cross-share holding entity known as the zaibastu.HISTORY OF BANKING IN INDIA A bank is a financial institution licensed by a government. For example banks are important players in financial markets and offer financial services such as investment funds.lending money by way of overdraft. installment loan or otherwise Providing documentary and standby letters of credit(trade finance). In Japan. In France. guarantees. Issuing bank drafts and bank cheques accepting money on term deposits . securities underwriting commitments and other forms of off-balance sheet exposures 4 • • • . performance bonds. and countries such as China having a wide variety regulations but no systematic process that can be followed typical of a communist system. The level of government regulation of the banking industry varies widely.
most ATMs enable anyone to deposit cash to any customer of the bank's account by feeding in the notes and entering the account number to be credited. banking centre or financial centre is a retail location where a bank or financial institution offers a wide array of face-to-face service to its customers. of insurance. and also small packages containing other matter. • Banking channels Banks offer many different channels to access their banking and other services: • A branch. most ATMs enable card holders from other banks to get their account balance and withdraw cash. Currency exchange. Banks also normally use mail to deliver periodic account statements to customers. distribution or brokerage. and ATMs are providing a wider range of services to a wider range of users. Mail is part of the postal system which itself is a system wherein written documents typically enclosed in envelopes. This can be used to deposit cheques and to send orders to the bank to pay money to third parties. are delivered to destinations around the world. Also.• • Safekeeping of documents and other items in safe deposit boxes Acting as a 'financial supermarket' for the sale. Most banks now have more ATMs than branches. even if the card is issued by a foreign bank. For example in Hong Kong. ATM is a computerized telecommunications device that provides a financial institution's customers a method of financial transactions in a public space without the need for a human clerk or bank teller. with or without advice. unit trusts and similar financial products. • • 5 .
Online banking is a term used for performing transactions. for electricity). over the Internet through a bank.• Telephone banking is a service provided by a financial institution which allows its customers to perform transactions over the telephone. or via a videoconference enabled bank branch. credit union or building society's secure website. Mobile banking is a method of using one's mobile phone to conduct simple banking transactions by remotely linking into a banking network.g. • • • 6 . Video banking is a term used for performing banking transactions or professional banking consultations via a remote video and audio connection. This normally includes bill payments for bills from major billers (e. Video banking can be performed via purpose built banking transaction machines (similar to an Automated teller machine). payments etc.
The main aim behind the setting up of IDBI was to provide credit and other facilities for the Indian industry. In February 1976. now more popularly known as IDBI Bank. The foundation of the bank was laid down under an Act of Parliament. the ownership of IDBI was transferred to Government of India. was established as a wholly-owned subsidiary of Reserve Bank of India.IDBI BANK PROFILE A brief profile The Industrial Development Bank of India Limited. in July 1964. 7 . which was still in the initial stages of growth and development.
In September 1994. and registered path-breaking success. The following year. in response to RBI's policy of opening up domestic banking sector to private participation. to offer a broad range of financial services. IDBI Bank had a net income of Rs 9415. 900 8 . had 230 branches spread over 47 districts. Equity Broking. Client Asset Management and Depository Services. promoting and developing industry were to be coordinated. IDBI set up IDBI Bank Ltd. PRESENT Today. thus diversifying its business domain and entering the arena of retail finance sector The year 2005 witnessed the merger of IDBI Bank with the Industrial Development Bank of India Ltd. renamed ‘IDBI Home finance Limited’. It is presently regarded as the tenth largest development bank in the world. public issue of the bank was taken out.601 crores. with innovative Deep Discount Bonds. at that time.After the transfer of its ownership. IDBI became the main institution. as its wholly-owned subsidiary. IDBI took over Tata Home Finance Ltd. it set up the IDBI Capital Market Services Ltd. IDBI Bank is counted amongst the leading public sector banks of India. including Bond Trading.. while providing an array of wholesale and retail banking products (and does so till date).9 crores and total assets of Rs 120. in 9 states). apart from claiming the distinction of being the 4th largest bank. In July 1995. mainly in terms of reach. This is because of its wide network of 509 branches. The following year. after which the Government's shareholding came down (though it still retains majority of the shareholding in the bank). IDBI Bank acquired United Western Bank (which. IDBI accessed domestic retail debt market for the first time. In the financial year of 2008. In January 1992. in association with SIDBI. The new entity continued to its development finance role.. through which the institutes engaged in financing. In September 2003. in overall ratings.
IDBI has set up institutions like The National Stock Exchange of India (NSE). The National Securities Depository Services Ltd. (NSDL) and the Stock Holding Corporation of India (SHCIL). Apart from being involved in banking services. 9 .ATMs and 319 centers.
VISION AND OBJECTIVES OF IDBI 10 .
IDBI has played a pioneering role in fulfilling its mission of promoting industrial growth through financing of medium and long-term projects. In February 7. IDBI also provides indirect financial assistance by way of refinancing of loans extended by State-level financial institutions and banks and by way of rediscounting of bills of exchange arising out of sale of indigenous machinery on deferred payment terms. promoting and developing industry in the country.HISTORY OF IDBI BANK The Industrial Development Bank of India (IDBI) was established on July 4. IDBI evolved an array of fund and fee-based services with a view to providing an integrated solution to meet the entire demand of financial and corporate advisory requirements of its clients. 1964 under an Act of Parliament as a wholly owned subsidiary of the Reserve Bank of India. both in rupee and foreign currencies. IDBI has 11 . During the four decades of its existence. Although Government shareholding in the Bank came down below 100% following IDBI’s public issue in July 5. Over the years. in consonance with national plans and priorities. modernization and diversification purposes. IDBI provides financial assistance. for green-field projects as also for expansion. In the wake of financial sector reforms unveiled by the government since 2. the ownership of IDBI was transferred to the Government of India and it was made the principal financial institution for coordinating the activities of institutions engaged in financing. diversified and efficient industrial and institutional structure but also adding a qualitative dimension to the process of industrial development in the country. IDBI has enlarged its basket of products and services. including manufacturing and services. covering almost the entire spectrum of industrial activities.3%). the former continues to be the major shareholder (current shareholding: 52. IDBI has been instrumental not only in establishing a well-developed.
The bank was pioneer in adapting to policy of first mover in tier 2 cities. But this recommendation was rejected by the government. In pursuance of this mandate. Latter RBI constituted a committee under the chairmanship of S. About IDBI Bank The Industrial Development Bank of India Limited commonly known by its acronym IDBI is one of India's leading public sector banks and 4th largest Bank in overall ratings. The committee wanted to the development of financial institution to diversify its activity. It is currently 12 . particularly in the pre-reform era . was a vibrant new generation Bank. modernization of specific industries. The Pvt. entrepreneurship development along with support services for creating a deep and vibrant domestic capital market. Narasimam committee recommends that IDBI should give up its direct financing functions and concentrate only in promotional and refinancing role. among others. in catalyzing broad based industrial development in the country in keeping with its Governmentordained ‘development banking’ charter. Khan to examine the concept of development financing in the changed global challenges. IDBI’s activities transcended the confines of pure long-term lending to industry and encompassed. It recommended to harmonize the role of development financing and banking activities by getting away from the conventional distinction between commercial banking and developmental banking. employment generation. including development of apposite institutional framework. This committee is the first to recommend the concept of universal banking. balanced industrial growth through development of backward areas. Bank was the fastest growing banking company in India. with which the parent IDBI was merged.H. RBI categorized IDBI as "other public sector bank”. IDBI Bank.played a pioneering role.
for green-field projects as also for expansion. The Bank also had the least NPA and the highest productivity per employee in the banking industry. The bank was pioneer in adapting to policy of first mover in tier 2 cities. signaling IDBI’s foray into the IDBI Bank. The National Securities Depository Services Ltd. IDBI provides financial assistance. Some of the institutions built by IDBI are The National Stock Exchange of India (NSE). both in rupee and foreign currencies. also known as Industrial Development Bank of India was established in 4 july by an Act of Parliament to provide credit and other facilities for the development of the fledgling Indian industry. IDBI also provides indirect financial assistance by way of refinancing of loan extended by State-level financial institutions and banks and by way of rediscounting of bills of exchange arising out of sale of indigenous machinery on deferred payment terms. was a vibrant new generation Bank. with which the parent IDBI was merged. as a private bank after government policy for new generation private banks. Business Overview IDBI. IDBI Bank was ranked in the Top 5 Indian banks on the basis of Business Segment size. modernization and diversification purposes. The Private Bank was the fastest growing banking company in India.the tenth largest development bank in the world in terms of reach with 75 ATMs. 13 ... In September 2003. 58 branches and 352 centers. (NSDL) and the Stock Holding Corporation of India (SHCIL) IDBI BANK . IDBI diversified its business domain further by acquiring the entire shareholding of Tata Finance Limited in Tata Home finance Ltd.
general and administrative costs from 62. Company has reduced the percentage of sales devoted to selling.BUSINESS AND FINANCIAL METRICS Historical Trends Year over year. IDBI Bank Ltd has been able to grow revenues from 960 Crores to 1690 Crores in the year 2008.17%. 14 . This led to a net profit growth from 590 Crores to 750 Crores.52% to 44.
Net Interest Income stood at Rs 229 Crores. Q1FY09 Financial Results IDBI Bank reported a net profit of Rs 160 Crores.02%. 50.5 Rs 45. Bottom-line growth (net profit growth) during the quarter was bolstered on buyback of shares of its subsidiary and excess depreciation write-back of Rs39.49% as compared to last year's 156 Crores.410 Crores . the Bank's CAR stood at 12.This increase is primarily driven by addition of 65 branches to the network over the year. up by 4% as compared to the last year . up by 4. Q2 FY09 Financial Results IDBI Bank reported a net profit (after tax) of Rs 162 Crores. IDBI Bank continued to maintain a sound capital base as indicated by its Capital Adequacy Ratio.1.06. Treasury gains for the quarter were supported by the buyback and Provisions were lower due to the write-back of NPA provisions.7 Rs 50.Annual income data. As against the stipulated RBI norm of 9%. Rs 30.5 Rs 280.30.4 Rs 448.5 Source: Company reports. Rs 5380.2 Rs 748. registering a growth of 42%.1 Crores.832 Crores as against Rs 1. Rs 027.7 Rs 345. 2007. 2008. in Crores Net Interest Income Other Income Net Income Profit (after tax) 05-06 06-07 07-08 Rs 8020. Total assets grew by 24% to Rs.529 Crores as of June 30.09% as compared to last year's Rs 150 Crores.3 Rs 72. up by 53. As of June 30. Total business (deposits and 15 . IDBI Bank’s total business (deposits and advances) stood at Rs 1.8 Rs 35.
66.. as other sources of funding for infrastructure companies became expensive during the quarter.6 Crores for the quarter ended December 3. CASA was reported to be16. Total Income has increased from Rs 2450. Deposits increased due to higher interest rates prevailing in the system. 2008 Share Holding Pattern 16 .25% to Rs. 2008 as compared to Rs 176 Crores for the quarter ended December 3. 2007 to Rs 3513.advances) grew by 48.3 Crores for the quarter ended December 3. The growth in "advances" is primarily driven by strong demand for corporate loans. Provisions were lower due to lower investment depreciation and write-back of NPA provisions Q3 FY09 Financial Results The Bank has posted a net profit of Rs 222.1. 2007.564 Crores.19% of total deposits.7 Crores for the quarter ended December 3.
61 % profits) Wholesale Banking provided 4652 Crores as Net Interest Income and Rs 423 Crores as the Net Profit in the year of 2008. IDBI is a member of the Core Committee of the Government set up for finalization of the Ultra Mega Power Projects.Business Segments Wholesale Banking Services(58% income. cash management. 31% profits)  17 . it is also an active member of the Inter-Institutional Group for power sector Retail Banking Services(27% income. roads. It has been actively participating in structuring and financing of infrastructure projects in the areas of power. telecom. Further. seaports. transactional services. trade services. airports. to large. mid & small sized corporates and agri-based businesses. railways and logistics as well as Special Economic Zones. The Wholesale bank provides services such as working capital finance.
. and Equities. Local Currency Money Market & Debt Securities. giving the customer a one-stop window for all his/her banking requirements Treasury (15% income. the bank has three main product areas . Within Treasury. Cash Management Services. In Corporate Finance.Foreign Exchange and derivatives. 6% profits) Wholesale Banking provided Rs 1283 Crores as Net Interest Income and Rs 44.Retail Banking provided Rs 2166 Crores as Net Interest Income and Rs 187 Crores as the Net Profit in the year of 2008. The objective of the Retail Bank is to provide its target market customers a full range of financial products and banking services.8 Crores as the Net Profit in the year of 2008. IDBI offers a wide array of corporate banking products under various business segments such as Deposits. Trade Finance and Treasury Products. SUBSIDIARIES 18 . Central and State Government agency business (both direct and indirect taxes).
company or corporation. IDBI Capital Market Services Limited IDBI Capital Market Services Limited (IDBI Capital) offers Stock Broking. During the year. Merchant Banking. Portfolio Management of Pension Funds & Research services to institutional. Corporate Advisory Services. Distribution of Financial Products. IDBI Home Finance Limited IDBI Home finance Ltd. The Equity broking segment has scaled up its operations enhancing turnover of cash segment by 40% over the previous year. Debt arranging & underwriting. society or association enabling such borrower to construct or purchase in India a house or flat for residential purposes. corporate and retail clients. is a 100% subsidiary of IDBI Bank Ltd. IDBI 19 . The Company was incorporated on January 10. IDBI Capital is a major player in the Pension Fund Management with assets of over Rs. 2000 with the main object of carrying on the business of providing long term finance to any person.8250 Crores.
2710 Crores. focusing mainly on the BFSI sector.Home finance’s outstanding loan portfolio increased by Rs. registering a growth of 26%. IDBI Intech Limited It provides IT related services in the area of Consultancy. System Integration. IDBI Gilts Limited IDBI Gilts Ltd.2147 Crores to Rs. Applications & Server hosting and other IT related managed services and specialized training to the IDBI Group companies and the other organizations.53 Crores from Rs. System implementation & support. was set up to undertake Primary Dealership [PD] Business. IDBI Gilts also plans to be a major player in the interest rate Revenue Break Down among Subsidiaries 20 . underwriting in auctions of primary issuance of Government dated securities and treasury bills. The company's business includes Bond trading. In addition.
0 0. 58348.7 22.34.85 Total Earnings in Rs Cr 772.Competition IDBI is the tenth largest development bank in the world.2 2048.4 4472.5 885.4 72.35 730. The company faces competition from both national banks and regional banks in the country.5 22 . 3344.2 38.7 Net Profit in Rs Cr 72.7 2.7 4. Financial Comparison of the competitors: Financial metrics FY2008 Market Name Capitalization in Rs Cr IDBI SBI SB Mysore PNB Bank of India 4.3 Earnings per share 0.58 200.8 38.58 8 4358.
MARKET SHARE OF IDBI (BANKING SECTOR) 23 .
Hiralal Zutshi Mr. K. Analjit Singh Ms. G.BOARD OF DIRECTORS (position as on july 16. Lila Firoz Poonawalla Mr.2009) Mr.V. Subhash Tuli Dr. Ajay Shankar Mr. Bundellu. Y S P Thorat IDBI Bank Organizational Chart 25 . Chaturvedi Mr. Yogesh Agarwal.C. O. Chairman & Managing Director Mr. Narasimha Murthy Mr. Deputy Managing Director Mr.
Vice president Marketing Vice president Operations Regional Head Zonal Head Divisional Sales Manager Territory In charge 26 . R.Chairman President Vice president Finance Vice president H.
IDBI BANK BUSINESS CHART IDBI BANK Development Bank Retail Banking \ Saving Account Current Account Investment Personal Saving Corporate Saving 27 .
BRANCH NETWORK OF IDBI BANK Score board Branches ATMs Ext. of branches. counters Centres 566 972 Nil 350 No. Metro Urban Semi-urban Rural 196 204 111 55 28 .
to co-ordinate and to control. In a survey it was found that India had 100. Though we all know that 'Manage' is nothing but to forecast and plan. it's financing the establishment of all major policies and the provisions under which the organization is to be run and the selection of the principal officers. a day’s having very importance. Now a days wealth Management has very craze in the business world. So many Banking companies are engaged in the business of wealth management.000 milliners day end of year 2006 is now grow up by 21% from a year earlier (Asia pacific wealth report). Management embraces all duties and functions that pertain to the initiation of an enterprise. The term wealth management. 29 . to organize. The eminent writer and management guru William Spriegal has given very valuable definition that 'Management is that function of an enterprise which concern itself with the direction and control of the various activities to attain business objectives. to command. In the general view the word management is form with Manage + Men + 'T' where 'T' stands for the factor time. The premier insurance industry is now booming because so many bankers are also adopting and playing safe in the business of insurance the term called is Banc assurance. now.WEALTH MANAGEMENT – AN INTRODUCTION Management is what a manager does "the statement given by Louis Allen has very broad and meaningful meaning. also.
Assets. While defining wealth Management we have to think in planned manner. For our information the wealth management institute (WMI). The Meaning of Management we have already seen in the steering introduction.CONCEPT OF WEALTH MANAGEMENT: The term wealth management formed with two words wealth & Management. the first 30 . The meaning of wealth is – Funds. protect and distribute assets in a much planned systematic and integrated manner. instrument. They are:(1) (2) Private Banks Family Offices. investments and cash it means the term wealth management delt with funds Asset. investments and cash it means the term wealth management deft with funds Asset. There are two types of wealth management institutions. protect and distribute assets in a much planned systematic and integrated manner. manage. While defining wealth Management we have to think in planned manner. manage. cash and any other item of similar nature. cash and any other item of similar nature. " WEALTH MANAGEMENT : INDIAN CONCERN :In this globalized era India have huge wealth management need. "Wealth Management is an all inclusive set of strategies that aims to grow. The Meaning of Management we have already seen in the steering introduction. The meaning of wealth is – Funds. instrument. "Wealth Management is an all inclusive set of strategies that aims to grow. Assets. engaged in the business of wealth management in Middle East. WEALTH MANAGEMENT IN INDIA: ISSUES & CONCERNS The term wealth management formed with two words wealth & Management.
mutual funds or Exchange Traded Funds) Position of India in Wealth Management :In the annual survey done by Cap Gemini.) and assets (e. SA and Merrill Lynch it was found that ranks of millionaires grew 6% in the previous year. India & China posted the biggest gain in millionaires advancing by 23% & 20% respectively. Investment management is the professional management of various securities (shares.center of excellence for the wealth management education in Asia was established in Singapore in the year 2003. Local banks now competing with international banks. The Middle East region has become very highly competitive over the last five years. corporations etc. the entry and increasing market share is not very easy task for them but they are fighting. Tapping in to the Indian market it is very crucial for private banks and private wealth managers. The global institutions are looking towards the Middle East to grow their wealth management business and attracting the big business houses by their attractive service providing facilities. to meet specified investment goals for the benefit of the investors. pension funds..g.) or private investors (both directly via investment contracts and more commonly via collective investment schemes e. real estate). Where Private Banks and Family Offices are discussing about the strategies to capture the wealth management business in the Middle East. because the number of richer people grew in India & China where India is competing China. The aim of WMI is to establish Singapore as the Asian hub for wealth Management. bonds etc. Investors may be institutions (insurance companies. 31 .g. The wealth management Institute (WMI) is providing professionals for wealth management with a nice combination of learning and practical training.
to maintaining this lifestyle. SERVICES PROVIDED BY WEALTH MANAGEMENT INSTITUTIONS :Wealth management offers the following services: Investment planningAssists you in investing your money into various investment markets. Insurance planningAssists you in selecting from various types of insurances. Retirement planningRetirement planning is critical to understand how much funds you require in your old age. So we can understand that there is more opportunities in the wealth management business in Asia specially in India. west Asia 16%.When we are watching the world wide increase in number of millionaires the facts collected by Cap Gemini. Asset protectionBegins with your financial advisor trying to understand your preferred lifestyle and then helping you deal with threats. such as taxes.A. self options and captive insurance companies. India has 23% growth in the last year. creditors and lawsuits. and Merrill Lynch survey report. inflation. S. The biggest Asian economy China stands on second position with 20%. keeping in mind your investment goals. volatility. insurance 32 . United States 4% and United Kingdom (UK) 2%.
33 . Business succession planningAssists in planning for the inevitable to maximize returns. This service is critical for every person whose net worth is high. Estate planningHelps in protecting you and your estate from creditors. lawsuits and taxes. supporting your favorite causes while also receiving tax benefits. Wealth transfer: Helps you pass on your wealth to your dependents. This might include planning for charity. Business planningThis service aims at optimizing the tax free advantages of running your own business. Taxation planningHelps in minimizing tax returns.
And.IDBI WEALTH MANAGEMANT AND VARIOUS FEILDS Because you have a lot more to manage than just your wealth Wealth management can help you determine what's really important to you. creditors. Managing risk? Systematically. tragedy — and help you deal with them using everything in the arsenal of one of the world's largest financial services firms. yes. Income and Lifestyle Through an in-depth discovery process your Financial Advisor will work with you to understand and document what you want to do in this lifetime. Planning deliberately so that your wealth works to bring you a lifestyle well earned? That's where it starts. strategies to guarantee that income. and the one you're building toward. then develop actionable strategies to help you realize your most cherished hopes and defend against the things that might undo them. from now until retirement and from then on. We'll then map out a course to help you seek the returns you'll need for how you intend to live and to achieve the income you'll need to do exactly what you want one year at a time. Wealth Transfer Your Financial Advisor will approach your plan for wealth transfer from a wider angle than a traditional estate plan. inflation. volatility. identity thieves. lawsuits. Asset Management By understanding the lifestyle you enjoy. We work with you to understand your 34 . Borrowing? Strategically. Investments ?. Of course. if you like. your Financial Advisor can see the threats against it — taxes.
Whether by design or by accident.. Investment Management We believe that your plan for your life is the most important part of investing. (not necessarily) whilst the more generic fund management may refer to all forms of institutional investment as well as investment management for private investors.g.. The business you'll open when you do. Investment managers who specialize in advisory or discretionary management on behalf of (normally wealthy) private investors may often refer to their services as 35 . The term asset management is often used to refer to the investment management of collective investments.g.. And the aging parent who will need to move in with you in the next few years. or a sense of obligation for each generation to help give the one that follows a leg up in life. bonds etc. then craft a plan to help you lead it and pass on what you see as most important to the next generation. Investors may be institutions (insurance companies. it should start with your definition of a rich life. corporations etc. This might mean a passion for education. We advise that it be by design. real estate). Whatever it is. to meet specified investment goals for the benefit of the investors. they are all part of one plan.like when you plan to retire — and when you secretly hope to retire. mutual funds or Exchange Traded Funds.) and assets (e. or protecting your family's bonds of affection toward one another.) or private investors (both directly via investment contracts and more commonly via collective investment schemes e. How much you'd like to travel. pension funds. Investing with a Financial Advisor is based on the simple yet powerful premise of wealth management: Your investments and your life are uniquely intertwined. Investment management is the professional management of various securities (shares. It could mean protecting a work ethic and thirst for accomplishment.definition of a rich life. Little things.
such as rent or utilities. a financial plan can be a budget. The term "private" refers to the customer service being rendered on a more personal basis than in mass-market retail banking. such as a new business or product line. usually via dedicated bank advisers. income statement. While a financial plan refers to estimating future income. division or department. borrowing or using saved cash. which allocates savings to various assets or projects expected to produce future income. and also reserves some income for short-term and long-term savings. It should 36 . A financial plan can also be an estimation of cash needs and a decision on how to raise the cash. shares in an existing business. A financial plan can also be an investment plan. such as through borrowing or issuing additional shares in a company. or real estate. and cash flow statement created within a business plan. for instance through earning. a plan for spending and saving future income. Financial forecast or financial plan can also refer to an annual projection of income and expenses for a company. a financial plan can refer to the three primary financial statements (balance sheet. Private Banking Private banking is a term for banking. Financial planning In general usage.wealth management or portfolio management often within the context of so-called "private banking". investment and other financial services provided by banks to private individuals investing sizable assets. This plan allocates future income to various types of expenses. expenses and assets. a financing plan or finance plan usually refers to the means by which cash will be acquired to cover future expenses. In business.
Portfolio management can also be defined as the aggregation and management of a diverse portfolio of supply (and demand-reduction) resources which will act as a hedge against various risks that may affect specific resources (i. Swiss and certain offshore banks have been criticized for such cooperation with individuals practicing tax evasion.e. An institution's private banking division will provide various services such as wealth management. inheritance and tax planning for their clients. not requiring banks to notify taxing authorities. tax evasion is only a civil offense. Historically private banking has been viewed as very exclusive. which is simply a non-incorporated banking institution. (not necessarily) whilst the more generic fund management may refer to all forms of institutional investment as well as investment management for private investors. The term asset management is often used to refer to the investment management of collective investments. savings.000 for private investors. 37 . The word "private" also alludes to bank secrecy and minimizing taxes through careful allocation of assets or by hiding assets from the taxing authorities. common mode failures. A high-level form of private banking (for the especially affluent) is often referred to as wealth management. Although tax fraud is a criminal offense in Switzerland. only catering for high net worth individuals with liquidity over $2 million. although it is now possible to open some private bank accounts with as little as $250.not be confused with a private bank. Portfolio Management The functions of resource planning and procurement under a traditional utility structure.. fuel price fluctuations and certainty of supply.
contracts-for-differences. a portfolio manager would: aggregate and manage a diverse portfolio of spot-market purchases. Under a more market-driven power sector with a "powerpool" or POOLCO wholesale market structure. changes in environmental regulations. and environmental damages that may occur as a result of operating some supply resources). and the risk of health. safety.operational reliability. 38 . futures contracts and other market-hedging-type contracts and mechanisms.
Our specialists provide customized investment opportunities through equity. whether they are aiming for more aggressive strategies to capture immediate market trends. Significant assets need special attention which is why we aim to develop innovative and customized investment strategies to meet the specific needs of our clients. or seeking advice on conservative hedging strategies. fixed income. We appreciate that they may expect a higher level of interaction with their Relationship Managers and investment specialists. multi-asset class portfolios and as well as leading alternative investment managers. Our discretionary investment specialists will work with clients to design an individual strategy in accordance with their objectives. intelligence and leading investment opportunities. and liquidity needs and draw upon an open-architecture network of best-in-breed mutual funds. 39 . derivatives and innovative structured instruments that seek to meet specific investment objectives. and prefer to delegate the management of their portfolio. we understand that the Asian investor may face different challenges from other investors around the world. Or for those clients who may not have the time or expertise to manage their wealth. our discretionary investment service is an ideal approach to achieve your financial goals. They use their expertise in asset allocation and investment selection to provide clients with appropriate choices. IDBI team of investment advisory specialists service investors who choose to be highly active in their investment decision-making. When it comes to investing. risk tolerance. attitude towards risk and investment horizon.WEALTH MANAGEMENT AT IDBI Investment Services IDBI believe that the key to a successful investment relationship is a full understanding of our client’s short and long term goals. traditional portfolios. require the latest market information.
and provide for a sustainable future. accounting and who work to ensure that the financial and legal structures have a truly global perspective. we function as an independent consultant. whose advice is not tied to the purchase of IDBI products and services. Family governance and business succession planning • Philanthropy 40 . whether outside or within the IDBI Group. achieve greater tax efficiency.Private Wealth Solutions IDBI clients have worked hard to create wealth for their family and for future generations. This independent approach enables us to work with service providers and advisers. most families want to safeguard their prosperity. We provide comprehensive wealth planning solutions tailored to the specific needs of clients and their families throughout Asia. Working with their existing advisers and other financial institutions. Through Private Wealth Solutions we help them establish a strong foundation to protect their legacy. Family Wealth Advisory gives clients the combined experience of dedicated specialists. to provide the products. ensure a seamless management succession. Our wealth planners are specialists qualified in law.we help take care of their wealth planning needs whilst giving them greater peace of mind. Family Wealth Advisory Whether simple or complex. services and advice our clients need. We have experts in international and domestic wealth planning who examine personal situations and assist in creating ways to safeguard our client’s affairs. Which is why we are expertly positioned to help manage and protect and transfer our client’s wealth to future generations .
• • • Investment consultancy services Corporate finance solutions Tax advisory services Many of our Asian clients have international lifestyles and complex financial Banking Services needs. and loans and mortgages in order to help meet their financial needs. • • • • • • • • • • Treasury and foreign exchange Offshore and onshore deposits Tailor-made loans and mortgages Overdrafts and bridge-over facilities Market Linked Deposits Retail banking facilities including access to HSBC Group Debit cards and credit cards Money transfers Online banking Corporate banking facilities including access to IDBI Group IDBI CAPITAL MARKET SERVICES LIMITED 41 . Apart from the essential transaction-related services required to help manage their day-to-day finances. Our aim is to help clients achieve their goals in the most effective way possible. we can offer treasury and foreign exchange. offshore and onshore deposits.
Merchant Banking.in to help retail investors’ invest in Equity (BSE / NSE/F&O). IDBI Capital continues to remain a major player in the PF / Pension Fund Management with assets under management of over Rs. offers a fullsuite of financial products and services to institutional. It has also made initial forays into Private Equity investment. Distribution of Financial Products. it has tied up with your Bank as also with other banks viz. Debt arranging & underwriting. shares valuation. corporate and retail clients. Union Bank of India. etc. 42 .8250 crore. a wholly-owned subsidiary of IDBI Bank. IDBI Capital has established itself in the Investment Banking business having completed 13 issues apart from several Corporate Advisory assignments in project appraisal.idbipaisabuilder. debt restructuring. Two years back. loan syndication. Its businesses include Stock Broking. To enhance its retail reach across the country. This would help build an extensive retail network for the Company. Mutual Funds (15) and IPOs with information / analysis / recommendations provided therein. Karur Vysya Bank and Oriental Bank of Commerce for marketing its investment portal. Punjab National Bank. Bank of Rajasthan. IDBI Capital launched its online broking platform www.IDBI Capital Market Services Limited (IDBI Capital). Corporate Advisory Services. Portfolio Management of Pension / PF Funds & Research services.
After carrying out a detailed certification audit. The company is a major player in the Equity and Derivatives market and a leading manager of Pension & Provident Funds in the country. banks.in with advanced features and tools for an easy and informed investing experience in Equities. It has a strong agent network which caters to the investment needs of retail investors in instruments like IPOs. mutual funds and corporate houses. In accordance with the revised RBI guidelines. The company was set up in 1993 with the objective of catering to specific financial requirements of financial institutions. 43 . The company has executed several mandates on the Issue Management and Corporate Advisory Services.The Equity broking segment has scaled up its operations enhancing turnover of cash segment by 40% over the previous year. the primary dealing business was relocated to IDBI’s new subsidiary. IDBI Capital is highly regarded for safety and trust and enjoys a credit rating of “AAA” by CARE for its medium-term borrowings and P1+ by ICRA for its short-term borrowings. That would enable IDBI Capital to concentrate on financial services (institutional & retail) and equityoriented businesses. etc. The F&O segment market has also been launched during this fiscal. Bonds. M/s TUV India Private Limited (Member of TUV NORD Group Germany). IDBI Gilts Limited. the certifying agency issued the ISO 9001:2000 certificate. Over the last 5 years. The company offers an online investment portal idbipaisabuilder. the company has been ranked amongst the leading players in each of these businesses. Mutual Funds and IPOs.
PRODUCTS & SERVICES OFFERED IDBI Capital offers a full suite of products and services to Corporates. The range of services include :- 45 . Institutional and Individual clients.
Public Sector Enterprises and Indian Corporates covering sectors such as Steel and other metals. Healthcare. Chemicals. Our Team We have a combination of professionals with varied background who shares our values of truthfulness. The professional qualification of our team provide a rock solid foundation for giving consulting services and our depth of experience ranges from young management graduates from premier business schools to experienced finance professional and qualified chartered accountants as well. objectivity. Minerals. Mines.INVESTMENT BANKING Our Clients We represent Government organizations. Financial Services and other Core Sectors. Hospitality. 46 . innovation and analytical accuracy.
A HIERARCHY SHOWING INVESTMENT BANKING 47 .
fund managers of mutual funds. etc. Buyback 4. The above activities entails liasioning with institutional investors such as treasury departments of Domestic Institutions. FIIs. Preferential Allotments 6. Qualified Institutional Placements 3. Public Offerings 2.CAPITAL MARKETS IDBI Capital as an institutional player provides the entire gamut of Capital Market services encompassing: 1. Banks and corporates. private equity firms. FCCBs. A Hierarchy showing Capital Market Services 48 . HNIs. Takeover 5. External Commercial Borrowings.
Equity IPOs to placement of Equities etc A Hierarchy showing Institutional Broking & Distribution 49 .INSTITUTIONAL BROKING & DISTRIBUTION Institutions and Corporates have surplus funds to manage on daily basis as well as investible surplus for a defined period. The reward by way of return is always in proportion to the risk taken. advisory and distribution services for investment in Mutual Funds. advise and manage the same by blending caution with aggression in the desired proportion to teach client. The risk differs for Institution and Corporates subject to their preferences. IDBI Capital define. The range of services include from Equity Broking with customized research. Debt/Bonds.
RETAIL BROKING & DISTRIBUTION In addition to offering corporate. IDBI Capital aims to provide a single-point source for retail investors in their requirements for trading and investment products. innovative solutions. IDBI Capital also offers to financial planners. we believe it is high time investors are educated about the nuances of investments. A Hierarchy showing Retail Broking & Distribution 50 . IDBI Capital also offers a gamut of financial products and services that cater to a varied cross section of investors. We firmly believe brokers. We will go extra mile to empower the investors in managing their wealth to ensure a more rewarding future. institutional clients. media and regulators have a pivotal role in assisting the individuals to become wealthy. Looking at the opportunities in our market and the growth of our country. retail intermediaries and consumers to deliver lasting. The knowledge and awareness gained will empower investors and help them create wealth.
51 . Being a public sector. the Company has gone in for ISO Certification for Fund Management. The funds have continuously yielded superior returns. ISO Certification 9001:2000 Keeping in view the importance of standardized processes and service levels. The Company’s client base includes leading pension and provident funds in the country. retirement benefit and surplus funds. the Company is also audited by Comptroller and Auditor General (CAG) office and follows transparent practices. pension. and is the only company to have done so in this sector. These services are provided to various public and private sector undertakings and their provident. banks and corporates for their investment in Debt. which are significantly higher than the benchmark. The Company is a SEBI registered Portfolio Manager and manage its Client’s assets under both discretionary and non-discretionary mandates.FUND MANAGEMENT IDBI Capital Market Services Ltd. Mutual Funds and Equities over several years. (ICMS) is a leading Fund Manager in the country for Provident. Pension and Retirement Benefit Funds. Equity Portfolio Management and Mutual Fund Advisory. Its services include managing Client Assets--Pension & Provident Funds. IDBI capital has been advising institutions. Surplus fund Management.
Regulatory Approval IDBI Capital is a registered Portfolio Manager with Securities and Exchange Board of India (SEBI) since 1998 and is authorised to undertake Funds Management activities (Debt & Equity) for clients. These activities would be governed by Securities and Exchange Board of India (Portfolio Managers) Rules and Regulations, 1993. SEBI Registration No. of IDBI Capital is INP000000209, valid till the year 2010. The Key strengths of IDBI capital Market Services in the areas of Debt Fund Management are: 1. Fund Management experience of 10 years 2. Expertise in managing large corpus 3. Expertise in both Debt & Equity Market 4. IDBI Capital is the only Portfolio Manager in the Country to achieve ISO 9001: 2000 Standard for Quality Management Systems in Fund Management operations, with certification from TUV NORD an accredited German standards firm 5. Substantial Returns Over Benchmark 6. IDBI Capital is a SEBI registered Portfolio Manager 7. Minimum Idle Days 8. Our fund management skill covers Portfolio Analysis that includes ALM, Asset Allocation, Risk Analysis, Maturity Analysis and Yield Analysis 9. Transparency of Operations 10.Strict adherence to Compliance Procedures 11.Highly Rated Debt Research
12.Presence in All Segment/ Asset of the Financial Services: IDBI Capital deals in Equity and Equity related products and is one of the highly rated Mutual Fund Distributor (won two consecutive CNBC TV18 Institutional Financial Advisor Award). In Investment Banking and Debt Capital Market- Rated in Top 15 by Prime Database 13.Group Strength in Debt Market: IDBI Capital is one of the leading players in debt market with presence in primary dealership since July 2007. The current operations of primary dealership is conducted by a group company, IDBI Gilts Infrastructure
Experienced Fund Management Team: The Fund Management team comprises of experienced professionals (experience ranges between 2 years to 15 years) in Portfolio Management with requisite exposure in the fixed income and equity segment and qualifications Experienced Back-Office: The Clearing and Settlement Operations are manned by experienced personnel with requisite exposure to capital market and particularly debt market. The process is standardized as per the regulatory and other specific norms and mainly technology driven in most areas Accounting: Real time accounting of Remittances, Investments, Interest and Redemption proceeds ensures accurate reconciliation Professional Custodian: Member of NSDL for demat services and offers Constituent SGL Account facility for Government securities through IDBI Gilts Ltd.
Functional Separation of Front and Back Office: Separate personnel handle the front and back office functions to ensure transparency and complete regulatory compliance Internal Controls: Adequate Risk Management systems in place to ensure complete regulatory compliance Audit Systems: Audit of all transactions and reports by an independent firm of chartered accountants. The accounts and transactions are also subject to CAG audit and other regulators Belongs to IDBI Group: IDBI is a leading bank, classified under ‘Other Public Sector Bank’. Established in 1964 by Government of India under an Act of Parliament, IDBI has essayed a significant role in the country’s industrial and economic progress for over 40 years – first as apex Development Financial Institution (DFI) and now as a full service commercial bank
Financial Statements The abridged Balance Sheet and Profit & Loss Account of IDBI Capital are given in Tables 1 and 2 respectively:
Crore) As at March 31 Paid up Capital Reserves & Surplus Current Liabilities & Provisions Deferred Tax Liability Total Liabilities Total Assets 2007 157.22 388.90 206.35 2.84 23. .10 396.Abridged Balance Sheet of IDBI Capital for the year ended 31 March 2007 & 2008 Table 1 : IDBI Capital Market Services Ltd.37 1.31 2008 157.53 396.31 388.90 204.30 30.10 55 .Abridged Balance Sheet (Rs.
16) 2008 35.Abridged Profit & Loss Account of IDBI Capital for the year ended 31 March 2007 & 2008 Table 2 : IDBI Capital Market Services Ltd.69) (18.49 (17.80 58.06 2.26 56 .Abridged Profit & Loss Account (Rs. Crore) For the year ended March 31 Total Income Total Expenditure Profit/(Loss) Before Tax Profit/(Loss) After Tax 2007 40. .23 33.17 2.
On an 57 . IFCI. It could unlock value from these investments. The investments include fast growing and restructuring companies like IDFC. where such control exists. etc. Factors affecting international portfolio investment: • tax rates on interest or dividends (investors will normally prefer countries where the tax rates are relatively low) interest rates (money tends to flow to countries with high interest rates) exchange rates (foreign investors may be attracted if the local currency is expended to strengthen) Portfolio investment is part of the capital account on the balance of payments • • statistics. Some examples of portfolio investment are: • • • purchase of shares in a foreign company. Indraprastha Gas. The approximate market value of quoted investments of IDBI is about Rs 1.INVESTMENT PORTFOLIO Portfolio Investment represents passive holdings of securities such as foreign stocks. purchase of bonds issued by a foreign government. which may be considered as precious gems in IDBI’s book and could augment the profitability of IDBI. none of which entails active management or control of the securities' issuer by the investor. Reliance Petroleum. bonds. acquisition of assets in a foreign country.800 crs. it is known as foreign direct investment. or other financial assets. IDBI has got a huge investment portfolio of quoted and unquoted equity stocks. Gujarat State Petronet Ltd.
Moreover.95 26.5 30. There could be many other stocks. which are as shown below: Unlisted Company % Holding Unlisted Company % Holding ARCIL CARE CCIL NSDL 19. Direct holdings and pooled funds 58 .unrealized gains basis.00 7. It also sometimes refers to the acquisition of equity (ownership) participation in a private (unlisted) company or a startup (a company being created or newly created).75 6.21 16.00 NSE STCI SIDBI SHCIL 5. the value of these investments is Rs 528 crs.96 Introduction to Equity Equity investment generally refers to the buying and holding of shares of stock on a stock market by individuals and funds in anticipation of income from dividends and capital gain as the value of the stock rises. it has many strategic investments in unlisted companies. which would be included in IDBI’s equity portfolio and the amount of investments or stake could be far more than revealed. When the investment is in infant companies. it is referred to as venture capital investing and is generally understood to be higher risk than investment in listed going-concern situations.28 19.
but only for large institutions) However. hedge funds. buyers and sellers are largely institutions (e. the mutual funds are typically managed by prominent fund management firms (e. The supply is the number of shares offered for sale at any one moment. mutual funds.The equities held by private individuals are often held via mutual funds or other forms of pooled investment vehicle. and banks). worldwide. Share price determination At any given moment.g. insurance companies. The rise of the institutional investor has brought with it some improvements in market operations. such as wealthy businessmen. an equity's price is strictly a result of supply and demand. the government was responsible for "fixed" (and exorbitant) fees being markedly reduced for the 'small' investor. The price of the stock moves in order to achieve and maintain equilibrium.g. markets have become more "institutionalized".. Market participants Many years ago. The demand is the number of shares investors wish to buy at exactly that same time. pension funds. buyers and sellers were individual investors. Thus. Over time. investor groups. with long family histories (and emotional ties) to particular corporations. corporate governance (at least in the West) has been very much adversely affected by the rise of (largely 'absentee') institutional 'owners'[ History 59 . Fidelity Investments or The Vanguard Group). but only after the large institutions had managed to break the brokers' solid front on fees they then went to 'negotiated' fees. many of which have quoted prices that are listed in financial newspapers or magazines.
In the middle of the 13th century Venetian bankers began to trade in government securities. which let shareholders invest in business ventures and get a share of their profits . In 12th century France the courratiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks.Historian Fernand Braudel suggests that in Cairo in the 11th century Muslim and Jewish merchants had already set up every form of trade association and had knowledge of many methods of credit and payment. disproving the belief that these were invented later by Italians. Because these men also traded with debts. institutionalizing what had been. the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. Genoa and Florence also began trading in government securities during the 14th century. they could be called the first brokers. Bankers in Pisa. The Dutch later started joint stock companies. 60 . The idea quickly spread around Flanders and neighboring counties and "Beurzen" soon opened in Ghent Antwerp and Amsterdam. and in 1309 they became the "Brugse Beurse". until then. In 1351 the Venetian government outlawed spreading rumors intended to lower the price of government funds. This was only possible because these were independent city states not ruled by a duke but a council of influential citizens. It was the first company to issue stocks and bonds. Verona.or losses. In late 13th century Bruges commodity traders gathered inside the house of a man called Van der Beurse. In 1602. an informal meeting.
The 30 stock sensitive index or Sensex was first compiled in 1986. BSE and NSE represent themselves as synonyms of Indian stock market. The working of stock exchanges in India started in 1875. BSE got permanent recognition from the Government of India. The history of Indian stock market is almost the same as the history of BSE. The history of Indian stock trading starts with 318 persons taking membership in Native Share and Stock Brokers Association. National Stock Exchange comes second to BSE in terms of popularity. BSE is the oldest stock market in India. which we now know by the name Bombay Stock Exchange or BSE in short. In 1965.THE INDIAN STOCK MARKET The Bombay Stock Exchange in Mumbai. The Sensex is compiled based on the performance of the stocks of 30 financially sound 61 .
The unpredictable behavior of the market gave it a tag – ‘a volatile market. In 1990 the BSE crossed the 1000 mark for the first time. Man Mohan Singh. says top officials of SEBI. portfolio managers investment advisors etc. Sensex crossed the 5000 mark in 1999 and the 6000 mark in 2000. The result of a cricket match between India and Pakistan also affected the movements in Indian stock market. 3000 and 4000 figures in 1992. It crossed 2000. The National Democratic Alliance led by BJP. It came to public knowledge that Mr. also known as the big-bull of Indian stock market diverted huge funds from banks through fraudulent means. the Government formed The Securities and Exchange Board of India. The liberal economic policies pursued by successive Governments attracted foreign institutional investors to a large scale. brokers. To prevent such frauds. The 7000 mark was crossed in June and the 8000 mark on September 8 in 2005. sub-brokers. Mehta. Many foreign institutional investors (FII) are investing in Indian stock markets on a very large scale. SEBI oblige several rigid measures to protect the interest of investors. through an Act in 1992. during 2004 public elections unsuccessfully tried to ride on the market sentiments to power.benchmark companies. NDA was voted out of power and the 62 . The up-beat mood of the market was suddenly lost with Harshad Mehta scam. SEBI is the statutory body that controls and regulates the functioning of stock exchanges. Experts now believe the sensex can soar past 14000 mark before 2010. He played with 270 million shares of about 90 companies. Bharatiya Janta Party’s rise to power etc.’ The factors that affected the market in the past were good monsoon. Now with the inception of online trading and daily settlements the chances for a fraud is nil. The reason for such huge surge in the stock market was the liberal financial policies announced by the then financial minister Dr. Millions of small-scale investors became victims to the fraud as the Sensex fell flat shedding 570 points.
Once viewed with skepticism. Many Indians working in foreign countries now divert their savings to stocks. education. The time factor also works for the NRIs. Later prime minister Man Mohan Singh’s assurance of ‘reforms with a human face’ cast off the fears and market reacted sharply to touch the highest ever mark of 8500. A good monsoon means improved agricultural produce and more spending capacity among rural folk. The stockbrokers based in India are opening offices in different countries mainly to cater the needs of Non Resident Indians. tourism and IT sectors backed by economic reforms ensure that Indian stock market continues its bull run. This recent phenomenon is the result of opening up of online trading and diminished interest rates from banks. Maruti Udyog Limited. large potential of growth in the fields of telecommunication. stock market now appeals to middle class Indians also. The bullish run of the stock market can be associated with a steady growth of around 6% in GDP. the growth of Indian companies to MNCs. The recent incidents that led to growing interest among Indian middle class are the initial public offers announced by Tata Consultancy Services. mass media.sensex recorded the biggest fall in a day amidst fears that the Congress-Communist coalition would stall economic reforms. ONGC and big names like that. Global investors now ardently seek India as their preferred location for investment. after United States hosts the largest number of listed companies. 63 . They can buy or sell stock online after returning from their work places. India. Good monsoons always raise the market sentiments.
compared to other less liquid investments such as real estate. History has shown that the price of shares and other assets is an important part of the dynamics of economic activity. on the smooth operation of financial system functions. This is an attractive feature of investing in stocks. Share prices also affect the wealth of households and their consumption. central banks tend to keep an eye on the control and behavior of the stock market and. Exchanges also act as the clearinghouse for each transaction.IMPORTANCE OF STOCK MARKET The stock market is one of the most important sources for companies to raise money. Therefore. or raise additional capital for expansion by selling shares of ownership of the company in a public market. TYPES OF EQUITY 64 . for instance. In this way the financial system contributes to increased prosperity. meaning that they collect and deliver the shares. in general. Financial stability is the raison d'être of central banks. Rising share prices. The liquidity that an exchange provides affords investors the ability to quickly and easily sell securities. This allows businesses to be publicly traded. and guarantee payment to the seller of a security. and can influence or be an indicator of social mood. The smooth functioning of all these activities facilitates economic growth in that lower costs and enterprise risks promote the production of goods and services as well as employment. This eliminates the risk to an individual buyer or seller that the counterparty could default on the transaction. tend to be associated with increased business investment and vice versa.
This may also be done on a proxy basis. Capital gains. the selection of an auditor for the corporate financial statements. accrue to a greater extent to the holder of common stock than to the holder of preferred stock. appointment of Senior Officers. The responsibilities associated with common stock mean the investor participates to a greater extent in the fortunes of the firm. Owners of common stock are responsible for the election of the Board of Directors. dividend policy and other matters of corporate governance. whereby a third party may be ceded the shareholders right to vote by the shareholder. Common stockholders also have a couple of significant rights should the business invested in be wound down: limited liability to the creditors of the firm and a 65 . through the increase in market price of the firm's stock.There are three basic types of equity:- Common Stock “Common stock represents an ownership in a corporation” Common stockholders participate in the earnings stream of the corporation through dividends paid and capital gains made on a per share basis.
residual claim on any assets or income derived once all prior claims (mortgages, bondholders, creditors, etc.) have been satisfied. Preferred Shares Preferred shares are stock in a company which have a defined dividend, and a prior claim on income to the common stock holder Should the company wind up operations, preferred shareholders are paid any obligations owed to them. Should a dividend be suspended by the Board of Directors, for whatever reason, the preferred share usually has a cumulative clause in it allowing that any unpaid dividends must be paid fully before any dividends may be declared and paid to holders of common stock. This means that the preferred share is a relatively more secure investment. The corporate issuing preferred shares may add differing features to the share in order to make it more attractive. These features are similar to those used in the fixed income market and include convertibility into common shares, call provisions, etc. Many have equated preferred shares with a form of fixed income security due to its defined dividend stream. However, with the added security offered by the guaranteed dividend stream, the holder of preferred shares gives up the right to vote on issues related to corporate governance. Therefore, the preferred holder has little input into corporate policy
Warrants Warrants are a form of option which is usually added to a corporate bond issue or preferred stock in order to sweeten the deal Warrant is a long dated option which allows the owner to participate in the capital gains (losses) of a firm without buying the common stock. In effect, the holder of a warrant has a leveraged play on the corporate common stock. As a form of option, a warrant has an exercise price and an expiry date. The exercise price is the price at which the holder may convert the warrant into common shares of the issuer. The expiry date is the last date on which the warrant may be converted into common shares. Given that a warrant is generally issued to reduce the cost of a debt issuer, the expiry date is usually more than two years from issuance. This allows warrants to trade separately from the bond with which they were issued. There by providing the investor with a long dated option on a firm's common stock. There is a drawback to warrants for those investors concerned with income. As an option, a warrant does not pay a dividend, and is subject to a certain amount of price compression as the underlying stock approaches or surpasses the exercise price. This is only a factor if the investor is purchasing the warrants when the common stock is trading near the exercise price. Warrant holders have no voting rights until the warrants are converted into common shares. Upon conversion an active role may be taken in corporate governance. If the warrants provide for conversion into preferred shares, it is unlikely the holder will gain any influence into corporate governance upon conversion
Introduction to Mutual Funds Depressed market or not, over 15 financial services institutions are warming up to take the plunge into the Indian mutual fund industry over the next one year. The idea of these neo-asset management companies (or AMCs) is to commence their fund business at a time when the market is in a lull phase, set a track record for themselves and go full throttle when the market begins to steam up, industry officials said. If industry sources are to be believed, Goldman Sachs, Shinsei Bank, DLF Prudential, Nippon Asset Management, BoB Pioneer, Indiabulls, IDBI, Edelweiss, Motilal Oswal, Anand Rathi, Religare, RSM Ambit, Schroders UK, India Infoline and Future Capital are all set to launch mutual funds in India. “ Currently, the MF industry has Rs 5.67 lakh crore of assets under management. As per data released by Association of Mutual Funds in India, the asset base of all mutual fund combined has risen by 7.32% in April, the first month of the current fiscal. As of now, there are 33 fund houses in the country including 16 joint ventures and 3 wholly-owned foreign asset managers. According to a recent McKinsey report, the total AUM of the Indian mutual fund industry could grow to $350-440 billion by 2012, expanding 33% annually. While the revenue and profit (PAT) pools of Indian AMCs are pegged at $542 million and $220 million respectively, it is at par with fund houses in developed economies. Operating profits for AMCs in India, as a percentage of average assets under management, were at 32 basis points in 2006-07, while the number was 12 bps in UK, 17 bps in Germany and 18 bps in the US, in the same time frame, the McKinsey report said. The report predicts that the retail segment could grow at a CAGR of 36-42% annually, taking the total AUM from US$36 billion in 2007 to $160-$200 billion in 2012. Rising incomes and increasing demand for wealth
– Being institutions with good bargaining power in markets. professionally managed basket of securities at a relatively low cost. “Most of them would set up their AMCs. mutual funds have access to crucial corporate information. Institutional investments in mutual funds are likely to witness a 25-33% annual growth. The income earned through these investments and the capital appreciation realized is shared by its unit holders in proportion to the number of units owned by them. which individual investors cannot access. The money thus collected is then invested in capital market instruments such as shares. with total assets under management increasing from $42 billion in 2007 to $160 billion by 2012. About Mutual Funds A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. a mutual fund research firm. Advantages of a MF – Mutual Funds provide the benefit of cheap access to expensive stocks – Mutual funds diversify the risk of the investor by investing in a basket of assets – A team of professional fund managers manages them with in-depth research inputs from investment analysts. most of these financial services institutions started planning to set up AMCs in 2007 while equities were booming in India. but what remains to be seen is how many succeed in their venture. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified.management services will drive this growth. According to Dhirendra Kumar of Value Research. debentures and other securities. 69 . The flow chart below describes broadly the working of a mutual fund.
• The Trustees of the mutual fund hold its property for the benefit of the unit holders. • It is mandatory to have a three tier structure of Sponsor – Trustee – Asset Management Company.Saving s Unit s AMC Trus t Return s Investment s Unit holders Registrar SEBI Trust Custodian AMC • The structure of Mutual Funds in India is governed by SEBI (Mutual Fund) Regulations. • The trust is established by a Sponsor or more than one sponsor who is like a promoter of a company. who is registered with SEBI. 1996. • Custodian. holds the securities of various schemes of the funds in its custody CATEGORIES OF MUTUAL FUNDS: 70 . He appoints the Trustees who are responsible to the investors of the fund. • Asset Management Company (AMC) approved by SEBI is the business face of the mutual fund as it manages all the affairs of the fund by making investments in various types of securities.
Mutual funds can be classified as follow: Based on their structure: 71 .
With fluctuating share prices.In this case a key stock market index. short term fluctuations in the market. Hence.. • Based on their investment objective: Equity funds: These funds invest in equities and equity related instruments. equities have outperformed all asset classes in the long term. at any point of time. However. Recently. At the same time. historically. If the fund is listed on a stocks exchange the units can be traded like stocks (E. Therefore. such funds have relatively low liquidity. Close-ended funds: These funds raise money from investors only once.it is similar to the equity diversified funds except that spreading across different sectors and stocks.g. ii) iii|) Equity diversified funds. Their portfolio mirrors the benchmark index both in terms of composition and individual stock weightages. fresh investments cannot be made into the fund. such funds show volatile performance. they invest in companies offering high dividend yields. 72 . such funds can yield great capital appreciation as. It can be further classified as: i) Index funds. investment in equity funds should be considered for a period of at least 3-5 years.100% of the capital is invested in equities Dividend yield funds.• Open-ended funds: Investors can buy and sell the units from the fund. Morgan Stanley Growth Fund). after the offer period. Redemption of units can be made during specified intervals. like BSE Sensex or Nifty is tracked. Therefore. generally smoothens out in the long term. thereby offering higher returns at relatively lower volatility. most of the New Fund Offers of close-ended funds provided liquidity window on a periodic basis such as monthly or weekly. even losses.
A banking ELSS. -An infrastructure fund invests in power. v) vi) Sector funds. a large Gilt funds ST. and are a good option for investors averse to idea of taking risk associated with equities.Invest 100% of the assets in sectors which are related through some theme. Debt fund: They invest only in debt instruments. commercial paper (CP) and call money. e. debentures. As a result. on the risk-return ladder. Balanced funds are the ideal mutual funds vehicle for investors who prefer spreading their risk across various instruments.Invest 100% of the capital in a specific sector. remaining in debt.They invest 100% of their portfolio in government securities Floating rate funds . Government of India securities. construction. they invest exclusively in fixed-income instruments like bonds. and money market instruments such as certificates of deposit (CD).iv) Thematic funds.Invest in short-term debt papers. Therefore.These funds invest 100% in money market instruments.g. cements sectors etc. they fall between equity and debt funds.g.Equity Linked Saving Scheme provides tax benefit to the investors. Funds are allocated to 73 . e. Equity-oriented funds -Invest at least 65% in equities. Floaters invest in debt Arbitrage fund. Following are balanced funds classes: i) ii) Debt-oriented funds -Investment below 65% in equities. sector fund will invest in banking stocks. Put your money into any of these debt funds depending on your investment horizon and needs.They generate income through arbitrage opportunities due to portion being invested in call money market. of and T-bills. i) ii) iii) iv) Liquid funds. Balanced fund: Their investment portfolio includes both debt and equity. instruments which have variable coupon rate. . mis-pricing between cash market and derivatives market.
Systematic Withdrawal Plan: if someone wishes to withdraw from a mutual fund then he can withdraw a fixed amount each month. 3. Systematic Transfer Plan: under this an investor invest in debt oriented fund and give instructions to transfer a fixed sum. The investor gets fewer units when the NAV is high and more units when the NAV is low.equities. RETURN: 74 . RISK V/S. Higher proportion (around 75%) is put in money markets. at a fixed interval. portfolio in long-term debt papers. This is called as the benefit of Rupee Cost Averaging (RCA) 2.Monthly Income Plans have an exposure of 70%-90% to debt and an securities. such funds invest a major portion of the MIPs. v) vi) vii) Gilt funds LT.fixed monthly plans invest in debt papers whose maturity is in line with that of the fund. exposure of 10%-30% to equities. viii) FMPs. derivatives and money markets.Typically. Payment is made through post dated cheques or direct debit facilities. Systematic Investment Plan: under this a fixed sum is invested each month on a fixed date of a month. to an equity scheme of the same mutual 0fund.They invest 100% of their portfolio in long-term government Income funds LT. Investment strategies: 1. in the absence of arbitrage opportunities.
BANKS V/S MUTUAL FUNDS: Mutual Funds are now also competing with commercial banks in the race for retail investor’s savings and corporate float money.S. India is at the first stage of a revolution that has already peaked in the U. The U. In India. The fund mobilization trend by mutual funds indicates that money is going to mutual fund in a big way. mutual fund assets are not even 10 per cent of the bank deposits. The power shift towards mutual funds has become obvious. The coming few years will show that the traditional saving avenues are losing out in the current scenario. but this trend is 75 .S. Many investors are realizing that investments in savings accounts are as good as locking up their deposits in a closet. boasts of an Asset base that is much higher than its bank deposits.
1 lakh on deposits MUTUAL FUNDS High Low Moderate More Low but improving Better Transparent Everyday Guarantee None BENEFITS OF MUTUAL FUND INVESTMENT 76 . CATEGORY Returns Administrative exp. Their role as intermediaries cannot be ignored.beginning to change. The basic fact lies that banks cannot be ignored and they will not close down completely. Risk Investment options Network Liquidity Quality of assets Interest calculation BANKS Low High Low Less High penetration At a cost Not transparent Minimum balance between 10th & 30th of every month Maximum Rs. This is forcing a large number of banks to adopt the concept of narrow banking wherein the deposits are kept in Gilts and some other assets which improves liquidity and reduces risk. It is just that mutual funds are going to change the way banks do business in the future.
Advantages of Wealth Management 1) Helpful In Tax Planning: The wealth management professional always shows the good path to the customers and provide the service of tax planning. 4) Helpful in forward looking: 77 . How to minimize the tax and save more money? 2) Helpful In Selection of Investment Strategy: Another advantage from the customer point of view is with the help of WM Professional the customer can easily know the investment strategy and analyze risk and return. 3) Helpful In Estate Management: With the help of wealth management professional we can also manage our estate. Estate management is a task to provide objective administration of our funds tailored to aim in responsible distribution and protection of our overall estate.
outsourcing for economy LIMITATIONS OF WEALTH MANAGEMENT 1. Chances of Fraud: Another demerit or limitation of the WM concept is it is not showing the actual position.We can say planning. 78 . that recognizes as our estate grows and changes occurs we require some team of professionals who help us in future planning. Wealth management Reduces The Scope Of Management: Though we all know that management has existence at all levels of life and society but the term wealth management only related with the higher level means rich people. Actual Picture VS Inflation: What is the actual position of market we don't know because everything is done by some WM professionals. There may be chance that the customers are in risk but they are showing the false return and vice-versa. 5) Helpful for Indian Economy: Banks which are engaged in business of WM earning revenues from the foreign countries i.e. 3. and is not having any plans and provisions for poor and lower and middle level of society. So we cannot assume our position in the market that also results in inflation because economy is unknown about the actual state. 2. The customer doesn't know about the things going on with using his wealth and there may be chances of forgery and fraud with customers.
Scope of the Study Each and every project study along with its certain objectives also have scope for future. Only professional objectives which are being covered by me in this project are as following To understand the concept of Banking Industry in India.RESEARCH METHODOLOGY Objective of the study Project study which is being conducted by me for the last three months is not only a formality for the fulfillment of the two year full time Post Graduate Programme in Management. but here I am not disclosing my personal objective which have been achieved by me while doing the project. And this scope in future gives to new researches a new need to research a new project with a new scope. To understand various aspects of Wealth Management To understand Wealth Management at IDBI Bank. To have a customers’ perspective about Wealth Management at IDBI Bank. Ltd. Scope of the study not only consist one or 79 . The objectives have been classified by me in this project from personal to professional. To understand the significance of various Banking operations Carry out a SWOT Analysis for getting customers’ insight on Wealth Management. To explain the profile of IDBI Bank Ltd. But being a management student I tried my best to extract best of the information available in the market for the use of society and people. Ltd.
ease and simple way. Basic tools which I used for project from statistics are. same with my project. And I am very thankful to all those tools for helping me a lot. Tools and Techniques As no study could be successfully completed without proper tools and techniques. Technological Tools – Ms-Excel Ms-Access Ms-Word 80 .Tables Bar charts and pie charts are really useful tools for every research to show the result in a well clear.Bar Charts . Scope of the study could give the projected scenario for a new successful strategy with a proper implementation plan. Whatever scope I observed in my project are not exactly having all the features of the scope which I described above but also not lacking all the features. For the better presentation and right explanation I used tools of statistics and computer very frequently. simple on seeing the charts anybody could know that what is being said. so it need not necessary for any observer to read all the theoretical detail.Pie charts .two future business plan but sometime it also gives idea about a new business which becomes much more profitable for the researches then the older one. Because I used bar charts and pie charts in project for showing data in a systematic way.
Journal by ICFAI University. All the data which I got from the market will not be disclosed over here but extract of that in the form of information will definitely be here.Sources of Primary and Secondary data: For the purpose of project. 81 . RBI Bulletin. Primary 2. So before mentioning the source of data for the project I would like to mention that what type of data I have collected for the purpose of project and what it is exactly. Secondary : Banking Customers of IDBI Bank. Details: Size of Data Area Type of Data Industry Respondent : : 100 : Jabalpur : 1. 2. Primary Data: Primary data is basically the live data which I collected on field while doing cold calls with the customers and I shown them list of question for which I had required their responses. data is very much required which works as a food for process which will ultimately give output in the form of information. Statistical Analysis In this segment I will show my findings in the form of graphs and charts. Secondary Data: Secondary data for the base of the project. In some cases I got no response from their side and then on the basis of my previous experiences I filled those fields. Source: Main source for the primary data for the project was questionnaires which I got filled by the customers or sometimes filled myself on the basis of discussion with the customers. I collected from intranet of the Bank and from internet. 1.
& Customer Perception towards Portfolio Management” I would be really grateful if you could spare your precious time for answering this questionnaire. I am a student of New Delhi Institution of Management for Finance Specialization. 1) Do your family members have any account in IDBI Bank? (a) 42% yes (b)58% No Interpretation When I ask this question to the customers I found that there is a scope to grab customer family account because still customers having more than one account and family account also in another bank. I have taken up a research project on “Study of Wealth Management at IDBI Bank Ltd. 82 .DATA INTERPRETATION & ANALYSIS Dear Respondent.
13% Interpretation After the survey I found that customer banking with IDBI Bank in such a manner that they are solving their problem not as a trusted regular customer. OTHER. other than Savings Account & Current Account.11% 6. LOCKERS. DEMAT ACCOUNT.28% 3. LOANS. PAISA BUILDER. 83 .2) Which of the following. have you opted at IDBI? Ans1.34% 5. IDBI FORTIS – 14% 2. because analysis sayings there is a scope in Demat account and paisa builder because this is equity market.NIL 4.
Between age group 36-50 I found that this segment is interested in Mutual Funds. The earning capacity of huge generation is much high but they are not interested to save money for wealth management.e. Between age group 51-65 are totally interested in Fixed Deposits because they don’t want to take any risk and save the money for their future. 84 . The next segment i. Fortis but more for Fixed Deposits.3) Approximately how much percentage of annual income do you invest before? Age Group 22-35 36-50 51-65 Percentage 20% 50% 30% Interpretation Between age group 22-35 I found that still there is untouched youth generations where we can work about.
But those who opted certified financial planner are satisfied with their services.4) Have you ever availed services of any Financial Advisor for managing your wealth? (a) Were you satisfied with their services? (b) If not kindly mention reason for the dissatisfaction? (a) 12% YES (b) 88%NO Interpretation In Jabalpur city customer believe that he can manage his Funds and there is no requirement of financial planner. 85 . This is new concept as well. Some people are not satisfied because of low returns in previous 3 years in equity market.
etc) 24% Interpretation When I ask the customers of IDBI Bank about Wealth Management Products and Services I found that people believe in investing money in fixed deposits other than that of other services of IDBI Bank. 86 .5) Have you opted any Wealth Management Products and Services? If yes which of the following? a) Fixed Deposit b) Securities Market c) Mutual Funds d) Gold & precious metals e) Post Office Schemes f) Others (Please Specify) AnsFixed Deposit -78% Securities Market-65% Mutual Funds-73% Gold & precious metals-14% Post Office Schemes34% Others (real estate. LIC.
6) Whether these Wealth Management Products and Services are in IDBI? If not in IDBI then where? Ansa) 27% YES (in IDBI Bank) b) 73% NO Interpretation Under the survey people still believe in government sectors bank that’s why they invest more in government sector bank whether it is ULIP (Unit Link Insurance Plan). Fixed Deposit etc. 87 . Bonds.
Others (Please Specify) b) If growth is your concern I. Securities Market II. Mutual Funds III.7) What option out of the following would you prefer the most: a) If risk is your concern I. Fixed Deposit-100% II. Real estate – 42% IV. Fixed Deposit II. Post Office Schemes III. Others (Please Specify) Ans – b) If risk is your concern I. Equity)-24% Interpretation When I ask the question with the IDBI Bank customer I felt that people strongly believe in fixed deposits and feel that. ULIPS IV. Gold & precious metals V. to invest money in fixed deposits is the safest part of any bank as compare to other services of IDBI Bank. 88 . Others (Gold. Art. Post Office Schemes-73% III.
Securities Market-63% Mutual Funds. Art. etc)-7% Interpretation When I asked this question to IDBI customers I felt that as growth is the concern the vast area covers Securities and no doubt they like to invest in mutual funds.18% ULIPS-9% Gold & precious metals.3% Others (Real estate. 89 .b) If Growth is your concern I. III. V. II. IV.
8) How much knowledge of stock market do you have as an equity investor? a) Totally ignorant 19% b) Partial Knowledge of Equity 68% c) Fully Aware 13% KNOWLEDGE OF STOCK MARKET Interpretation As per the sample size. it shows that a major part of the investors have partial knowledge of equity. 90 . whereas there are some which totally lack this knowledge and expertise.
Major part was having vast experience that is of more than 4 years. These are the ones who have been in the market and saw it rising to conquer the 10. There are very few who have experience of less than a year. The achievement of 12.000 mark by SENSEX was motivational force in this. These are those investors who entered into the market after noticing the rise in the market.000 peak 91 .9) How much experience do the customers have in the stock market which is influencing the investments? a) Less then a year 26% b) 1-4 year 21% c) More then 4 years 53% EXPERIENCE IN THE MARKET Interpretation The experience in the market was the factor which influenced the investments.
Magazines. It may be the current news (political. technological.10) What are the factors which are influencing the investment decision of the investors? a) Broker b) News c) magazines d) friends e) self f) others 20% 30% 2% Factors Influencing the Investment Decision of Investors 32% 10% 6% Interpretation There are many factors which influence the investment decision of the investors. The experienced person trust himself 92 . financial.). etc. These are the ones who have less experience. The “SelfEvaluation” is the next major factor. in the study it proved that many people trust the brokers most for the investment decisions. friends. etc.
Any bad news can make a person change his/her decision. Magazines and current News also matters.thereafter he/she invests. which investment option will you prefer to opt and why? 93 . 11) Are you aware of government pension plans? (a) 22%YES (b) 78% NO Interpretation When I ask this question with IDBI Bank customer I come to know that still there is a lack of information about government pension plans. but there is the scope for the banks and Financial institutions to sale their products to those who are not government employees or will not get pension from their employer. 12) In future.
94 .A. But still people are moving from Fixed Deposits to Equity Market.S.Ans(a) 78% Fixed Deposits (b) 13% Mutual Funds (c) 9% Others Interpretation In survey I found that generally people don’t want to take risk because of horrible result of previous financial years at week financial condition of the company because of sub.prime crisis in U.
13) Ans- Share Market now reaches our families kitchen. Internet. 95 . News Paper and all the above the Policy maker even do print their share on the pamphlets which is circulated to make aware of market position sensex. Do you agree with that? When I ask this question to customers of IDBI Bank customers I got following results: (a) (b) 83%YES 17% NO Interpretation Because of the high level of education even the women can get information from the various sources like Television.
14) On a scale of 1-5 how you rank the following : a) b) c) d) e) Share Market Fixed Deposits Gold Real estate Others Ans1. LIC. etc) Interpretation After the survey I found that people secure themselves and their money in Fixed Deposits other than that of services provided by IDBI Bank or other Banks. Share Market.60% (2nd) Fixed Deposits.40% (3rd) Real estate.80% (1st) Gold. 2.60% (2nd) Others. gold. 4. To convince people to invest their money to other services of IDBI Bank is very difficult.20% (4th) (art. 96 . 3. 5. post office.
97 . which services of IDBI BANK should improve to give more satisfaction? AnsWhen I ask this question to customers of IDBI Bank I found that customer complaining about following services of IDBI Bank they are: (a) (b) (c) Courier Services of IDBI Bank. In time officers response. Thus IDBI Bank should improve the above services so that in future IDBI Bank will get more and more customer and the development and growth can increase rapidly and frequently.15) As per your experience. Customer complaining about printers also for statements.
Young blood is also a strong reason to give in time services with efficiency which is most important for wealth management. training to their staff & preferred customer for monthly market report.e. OPPORTUNITES: 98 . (U. market position & future aspect • IDBI is a government bank but working like a private sector bank i. • Company which is introducing wealth management services newly could take some time to make customer faith. • • Sometimes young generation is also a cause for lack of experience. IDBI introduce IDBI fortis Wealth management services.) Unique selling point of IDBI Bank.SWOT ANALYSIS Strength: • Huge customer base in IDBI. • • IDBI is located in the middle of the city so people can reach their easily. strategy effect more to the segment.S. When new company comes in the market with new idea.P. It is very tough to break Axis bank & ICICI bank customers especially for wealth management. Dedicated staff for wealth management which gives more satisfaction to their clients. • • • WEAKNESS: • “Sarkarikarn” can influence the services. • I have seen customer complaining about IDBI courier services. 3) IDBI is regularly providing Wealth Management which is a unique services in this segment.
Branches of the IDBI Bank is also a limited. THREATS: • • Axis bank. • High network individuals (HNI) segments are very strong in the banks. ICICI bank & HDFC bank are the big competitor for IDBI Bank. • Market condition (equity) is also always opportunity for banks and investments institutes.• Huge earning capacity of people is increasing. Max New York etc investment companies in the rural areas • Lack of separate wealth management in IDBI bank is also a threat. • Huge potential and good market position of the bank. give a huge rural market to them. 99 . • So many govt. Reliance. Axis bank manages separate wealth management system which IDBI Bank does not do. • • Bajaj. sectors are customers of IDBI bank which gives opportunities to reach government employees.
CONCLUSION After studying the overall concept of wealth management we can say that it has various aspects some are favorable and friendly for the Indian economy and some are very dangerous for the Indian economy. I would like to say that I am still at the bottom rung of the ladder and there is still a large scope for improvement. The functions were the primary tools along with my interpretation. The customers have to beware and they have to make SWOT analysis before choosing the wealth management option. These functions. But if Indian financial institutions are engaged and choosing the WM business in foreign countries. My effort has mainly to discover and identify the facts.05% and hike in fuel prices in the Indian as well as international market. Suggestions & Recommendations 1. There is lack of wealth management services. At present Indian Economy is facing a lot of trouble by increasing inflation by 11. 2. 100 . As per Indian concept wealth management cannot success in India. it may be some relief for the downward moving Indian economy. How much I have succeeded is there for all to see through the medium of this project. In the end. Bank should start IDBI wealth management service with adequate staff dedicated only for same. There is definitely scope for improvement and further refinement. so bank should start separate branch for that. This project is just a scratch in the vast expense of identifying corporate/ individuals and most importantly retention of those respective services. previously uncharted territories have now become like a sixth sense. most probably middle-east countries.
print. 4. 5. ICICI Bank & HDFC Bank but the proper service of the bank still makes favorable conditions. 6. Customers complaining about courier services. media & other ways. 101 . Satna & Sagar but customers are not aware about this . It is tough to break the competition of the competitors like Axis Bank. With young generation there should be some experienced employers because mixture of experience and young blood can grow faster.banners . IDBI Bank open their branches in rural areas like Chindwara. bank should take serious action against this issue.3. IDBI Bank should start separate quick service desk for NRIs & High Net worth Individuals (HNI).so bank should advertise this through posters . Rewa.
com • www2.idbipaisabuilder.N. • ICFAI Journal of banking.idbi.BIBLIOGRAPHY REFERENCE MATERIAL • Banking law and practice by P.google.in www.com www.idbicapital. Websites • www.idbi. • The Economic Times.com 102 .com • • • • www. • Research Methodology by Cooper and Schindler.in www. Varshney.mutualfundsindia.
.)…………………..Annexure Questionnaire Dear Respondent. As a part of MBA curriculum for Finance Specialization.) :………………………………… : 1 …… 2 …. at IDBI Bank Ltd. Bangalore. : Male ………. I have taken up a research project on “Study of Wealth Management. Contact No... I am a student of National School of Business. ……………………………………………………………………………………… …….….(Mob. :.& Customer Perception Towards Portfolio Management”. No ………... 3 …… if more please specify ..………………………………………………………………. (Kindly tick mark whichever is applicable) Name Gender Married Address : ……………………...…………………………….... : Yes ……….)…………………...……………………….. Qualification No.. 103 . I would be really grateful if you could spare your precious time for answering this questionnaire. Female…….. …………………………….(Off. of Earning Members in family :(Res.
1 lacss & Rs. B.Business. 3) Do you operate your account in any other bank than IDBI? Yes ……… No ..…….. .1) A.. 20 Lacs Above Rs. Occupation:Salaried……. Annual Income:Equal to or less than Rs. III. IDBI FORTIS Products Lockers Loans Demat Account IDBI Paisa Builder (Online Stock Trading Account) 104 .…… 2) Do your family members have account in IDBI Bank? Yes ……… No ………..…….Others……. have you opted at IDBI? I. 5 lacs Between Rs.. Any other ………… 5) Which of the following.……Student……. 4) If Yes please specify where? SBI ………… AXIS ………… HDFC ………… ICICI ………. 20 Lacs …….. 10 lacs Between Rs. . V. IV.…… ……. other than Savings Account & Current Account. 5 lacs & Rs. II.Retired.
.% B.3 Yrs.. 8) Have you opted any Wealth Management Products and Services? Yes ……. Approximately how much %age of annual income do you invest? .. Were you satisfied with their services? Yes …….………….VI. …… 3 Yrs.. ……………. 6) A.. Post Office Schemes . ……………………………………………………………………………………… ……. 9) If yes which of the following? I... 105 IV.. . Securities Market III. ……………. If not kindly mention the reason for dissatisfaction……………………. No …….5 Yrs.. No ……. . Gold & precious metals …………… . …… 1 Yr. Mutual Funds V...) 18-30 31-45 46-65 1 Yr. No ……... Other (Please Specify)…………………... …… 7) Have you ever availed services of any Financial Advisor(s) for managing your wealth? Yes …….. Fixed Deposit II.. What is your Investment Horizon as per your age? Age (Yrs.. -10 Yrs.…………....
V. Real Estate 5.………. do you think should be improved so that you would like to opt it? ………………………………………………………………………………………. If safety is your concern IV. ……. please specify where else? ……………………………………………………………………………………… …… 11) What option out of the following would you prefer the most -: A. Others 106 . Gold 4.... ………………………………… 12) Which Wealth Management Product or Service of IDBI. Share Market 2.. Fixed Deposit Post Office Schemes Real Estate Others (Please Specify) .. …………. pension plan? Yes . Others (Please Specify) ……………. VII. 14) Share market has now reached our families kitchen? Do you agree? Yes ……. Fixed Deposits 3... No ……. 13) Are you aware about govt. VI.…….…… No ……. 10) Whether these are in IDBI ? Yes ……… No ……… If No. 15) How you score the following out of 5 points: 1.VI.