A

Project Study Report

On

Training Undertaken at

Motilal Oswal Securities Limited

Titled
“Analysis of derivative and stock market ”

Submitted in partial fulfillment for the

Award of degree of

Master of Business Administration

Submitted By: - Submitted To:-

Jitendra Dr. Sonal Jain
MBA Part II nd (Sem 4 th) H.O.D.
(Finance & Marketing)

Deepshikha College of Technical Education, Jaipur

2009-2011
Jitendra
Virahyas
JVIRAHYAS@GMAIL.COM
 Deepshikha College of Technical Education, Jaipur
(Affiliated to Rajasthan Technical University, Rajasthan)

Preface

Masters of Business Administration is conducted with providing knowledge to the

students regarding various type of management like financial management, marketing
management and production management etc.

As per the requirement of MBA course Motilal Oswal Securities Limited has been
kind enough to permit me to complete my project on “Analysis of derivative and stock
market”.

This report prepared during the project study. Which is student’s greatest treasure as
it is full of experience, observation and knowledge.

The project study was very interesting and gainful as it is close to real what have
been studied is all the years through was seen implemented in a modified and practical
form.

I have done my project study in Motilal Oswal Securities Limited at Sumerpur for 15
days. During this study period I have learned about Back office work, trading work, and
security market and sector analysis. I have come to know that how does security market
function and how one can deal in stock market and how to manage risk and portfolio. Thus
it was really beneficial for me in terms of knowledge and experience.

The only fault was that the time available was short and there was much to learn, yet
the things learned shall never be oblivion and are of great aid in the near future. I sincerely
believe that the research can be useful to the organization and others as well Motilal Oswal
Securities Limited.
Acknowledgement

I express my sincere thanks to my project guide, Reema mam, DCTE Jaipur, Mr.
Nirbhay singh rathore, francisee(Money Seed), of Motilal Oswal Securities Limited., for
guiding me right from the inception till the successful completion of the project. I sincerely
acknowledge him/her/them for extending their valuable guidance, support for literature,
critical reviews of project and the report and above all the moral support he/she/they had
provided to me with all stages of this project.

I would also like to thank the supporting staff of all the company Department,
especially for the Mr. Laxman sompura for their help and cooperation throughout our
project.

( Jitendra )
Executive Summery

The Indian stock market have seen various stages of economic cycles if we look at
market condition then we find that at the beginning of the year 2008 the market was on
cloud nine (all time high on 10 January 2008) Sensex was 21207.83. But after reaching it’s
all time high it has started to show strong resistance to carry on and the result of the
resistance and sharp slump in the world economy, the bull suddenly turned into bear and all
expectations of investors that market will reach 25000 just turned into dream and according
to current situation that is for away from reality. Investors just shocked due to slump in the
market condition, they have rethink about investment alternatives risk and returns. Capital
appreciation and time value of money.

Since investment become a basic need of everyone so each and every person wants
to secure his investment and willing to get good returns and capital appreciation upon the
investment fund. This study really gives an overview about how and when we invest in
various sectors. That how can invest money for future safety in various markets such as
primary market, secondary market, Govt. security market etc.

Thus the study is providing knowledge about investment scenario and guiding the
investors for safe investment with the help of economic analysis, fundamental analysis, and
financial analysis. One can analysis the market and understand the nature and movement
of market for safe investment and can become wiser investor that is most challenging thing
in current scenario.
Contents

1. Introduction to the industry

2. Introduction of organization
3. Research Methodology
3.1. Title of the Study
3.2. Duration of the Project
3.3. Objective of Study
3.4. Type of Research
3.5. Sample Size and method of selecting sample
3.6. Scope of Study
3.7. Limitation of Study
4. Facts and Findings
5. Analysis and Interpretation
6. SWOT
7. Conclusion
8. Recommendation and Suggestions
9. Appendix
10. Bibliography
Introduction to the industry

Broking industry is growing for last ten year with leaps & bounces to Indian economy
and stock market. Brokerage houses are known as intermediaries between market and
investor and play a key role in execute the functions to carry on the stock market. All the
brokerage houses having different sort of charges and fee according to their facilities and
efficiency provided to investors. They manage the portfolio, risk management and providing
guidance to investor for dealing in security market the major players of Indian broking
industry are as follows:-

1. Motilal Oswal Securities Limited

2. Bonanza Portfolio Limited

3. Religare Limited

4. Hem Securities Limited

5. Angle Broking Limited

6. India bulls Securities Limited

7. Anand Rathi Securities Limited

8. Share khan Limited

Analysis of players in the industry

Unicon

Unicon has been founded with the aim of providing world class investing experience
to hitherto underserved investor community. The technology today has made it possible to
reach out to the last person in the financial market and give him the same level of service
which was available to only the selected few.

unicon give personalized premium service with reasonable commissions on the

NSE, BSE & Derivative market through our Equity broking arm Unicon Securities Pvt. Ltd.
With our sophisticated technology you can trade through your computer and if you want
human touch you can also deal through our Relationship Managers out of our more than
100 branches spread across the nation.

Religare securities

Trading in Equities with Religare truly empowers you for your investment needs. We
ensure you have a superlative trading experience through -

A highly process driven, diligent approach

 Powerful Research & Analytics and
 One of the “best-in-class” dealing rooms

Further, Religare also has one of the largest retail networks, with its presence in
more than 1800* locations across more than 490* cities and towns. This means, you can
walk into any of these branches and connect to our highly skilled and dedicated relationship
managers to get the best services.

The Religare Edge:-

 Pan India footprint

 Powerful research and analytics supported by a pool of highly skilled
research analysts
 Ethical business practices
 Offline/Online delivery models
  Single window for all investment needs through your unique CRN

Anand Rathi

Anand Rathi (AR) is a leading full service securities firm providing the entire gamut of
financial services. The firm, founded in 1994 by Mr. Anand Rathi, today has a pan India
presence as well as an international presence through offices in Dubai and Bangkok. AR
provides a breadth of financial and advisory services including wealth management,
investment banking, corporate advisory, brokerage & distribution of equities, commodities,
mutual funds and insurance, structured products – all of which are supported by powerful
research teams.

How Bonanza differ from other in the industry

Bonanza Portfolio Ltd is an emerging leader in the high growth retail financial
services sector in India.

India set to emerge as one of the world’s largest retail financial services markets.
India’s GDP growth has averaged 6.5% since 1994 and expected to continue to grow at
8+%.

 Increasing sophistication of financial markets

 Indian consumer’s affinity for equity
 Emergence of large domestic retail brokerage houses
 India has nearly 10,000 brokers; most of them are small family businesses
 The last 5-7 years has witnessed the emergence of large institutional players
driving consolidation of the retail financial services market
 Global players are starting to make strategic inroads into the retail financial
services market
 Foreign broking houses dominate FII based institutional broking
 Some global majors like Citigroup are making inroads into retail by leveraging
their network
 E-trade has announced majority ownership of IL&FS Investment

Bonanza Portfolio Limited

 Bonanza, a leading financial services &brokerage house working diligently since
1994 can be describe in a single word as a “financial powerhouse”. With acknowledged
industry leadership in execution and clearing services on exchange traded derivatives and
cash market products, bonanza has spread its trustworthy tentacles all over the country
with more than 1050 outlets spread across 350 cities.

It provides an extensive range of services in equity, commodities, currency

derivatives, wealth management, distribution of third party product, etc.

Competition within the industry:

Competition within this industry is very high , there are lots of new company’s coming
in this business , although Bonanza Portfolio Limited has good reputation but competition is
so high and due to recession all the brokerage firm are badly affected and Bonanza
Portfolio Limited is also affected . This market is centre of attraction to new entrepreneur
because it is already fast growing market and it is for sure that it will go further, and there
are many opportunities lying ahead in the way .but although it is successful industry
competition affect the major players. And bonanza is one of the successful players in this
industry. it is working very efficiently to fight back with competition and challenging its
competitor by satisfying its customer at most level of their satisfaction.

It has many competitors which are providing different type of services .the brief
introduction of its competitor is given below:

5paisa.com:

5paisa is the trade name of India info line securities private limited (5paisa),
member of NSE and BSE. 5paisa is the wholly owned subsidiary of India info line
limited, India’s leading and most popular finance and investment portal. 5paisa has
emerged as one of leading player in e-broking space in India .their key products are
investor’s terminal and trade terminal .its special feature is that it is not charging any
kind of AMC which provides comfortable tariff card to its client. It provides the facility
of margin for intraday and delivery as well as.

Icici Direct.com:

Icici Direct.com is the most comprehensive website, which allows its client the
opportunity to invest in share, mutual fund, derivative (future and option) and other
financial products .they offer their clients a product for every investment need. This
provide the facility of cash trading, margin trading, margin plus trading, spot trading
and BTST facility to its client. It also provides the facility of margin and funding for
facilitating its client to trade with more money.

Share khan:

Share khan is also one of the close competitors of bonanza. It facilitate its
client in many ways .although it is not as big as India info line and icici direct.com,
etc, but it is still going forward speedily by winning the trust of its customers. Its
product range includes classic trade, speed trade, and speed trade plus. Which
facilitate its client during trading? It has also the producer for providing the market
and funding the trade.

Anand Rathi:

Anand rathi (AR) is a leading full service securities firm providing the entire
range of financial services. AR provides a breadth of financial and advisory services
including wealth management, investment banking, corporate advisory, brokerage
and distribution of equities, commodities, mutual funds and insurance –all of which
are supported by powerful research team. Its product includes demate and trading
account. it only provides margin for intraday to its clients , it does not provide funding
for delivery.

Religare:

Religare is driven ethical and dynamic process for wealth creation. based on
this , the company stared its Endeavour in the financial market .a company promoted
, controlled and managed by the promoters of ranbaxy , religare , was founded with
the vision of providing integrated financial care driven by the relationship of trust .

Kotak security:

Kotak mahindra is one of India’s leading financial institutions, offering

complete financial solution that encompasses every sphere of life. From commercial
banking, to stock broking, to mutual fund, to life insurance, to investment banking,
the group caters to the financial needs of individual and corporate.
 Kotak institutional equities has full financial service capability , which includes
derivative , facilitating market access through affiliated and the distinctive offering of
corporate access to investors. The division services over 250 client including files,
pension and mutual fund. The division has sales desk in Mumbai, London and New
York, with India desk also servicing clients in Hong Kong, Singapore, Japan and
Australia.

THE CAPITAL MARKET

The capital market

The capital market is the market for securities, where the companies and
government can raise long term funds. It is a marketing which money is lent for periods
longer than a year. The capital market includes the stock market and bond market. The
capital market consists of primary and secondary markets.

Primary market:

The primary market deal with the issue of new instruments by the corporate
sector such as equity shares, preference shares and debt instruments. Central and
State Government, various public sector industrial units, statutory and other
authorities such as state electricity boards and port trusts also issue bonds/debt
instruments.

The primary market in which public issue of securities is made through a

prospectus is a retail market and there is no physical location. Offer for subscription
to securities is made to investing community.

Secondary Market:

The secondary market or stock exchange is a market for trading and

settlement of securities that have already been issued. The secondary market
consists of 22 stock exchanges. The secondary market provides a trading place for
the securities already issued to be bought and sold. It also provides liquidity to the
 initial buyers in the primary market to re-offer the securities to any interested buyers
at any price, if mutually accepted.

Capital issues (Control) Act, 1947

The Act had its origin during the Second World War in 1943 when the
objective of the Government was to per-empts resources to support the war efforts.
Companies were required to take the Government approval for tapping household
savings. The act was retained with some modifications as a means of controlling the
raisin of capital by companies and to ensure that national resources were channelled
into proper lines.

Companies act, 1956

Companies act, 1956 is a comprehensive legislation covering all aspects of

company form of business entity from formation to wining-up. The legislation deals
with issue, allotment and transfer of securities an various aspects relating to
company management. It provides for standards of disclosure in public issues of
capital, particularly in the fields of company managements and projects, information
about other listed companies under the same managements and management
perception of risk factors.

Securities contracts act, 1956

The preciously self-regulated stock exchanges were brought under statutory

regulation through the passage of the SC, which provides for direct and indirect
control of virtually all aspects of securities trading and the running of stock exchange,
through a process of recognition and continued supervision.

3.1 Share Market

Securities and Exchange Board of India

SEBI is the Regulator for the Securities Market in India. Originally set up by
the Government of India in 1988, it acquired statutory form in 1992 with SEBI Act
1992 being passed by the Indian Parliament. Chaired by C B Bhave, SEBI is
headquartered in the popular business district of Bandra-Kurla complex in Mumbai,
and has Northern, Eastern, Southern and Western regional offices in New Delhi,
Kolkata, Chennai and Ahmedabad

SEBI has to be responsive to the needs of three groups, which constitute the
market:

 the issuers of securities

 the investors
 The market intermediaries.

SEBI has three functions rolled into one body quasi-legislative, quasi-judicial
and quasi-executive. It drafts regulations in its legislative capacity, it conducts
investigation and enforcement action in its executive function and it passes rulings
and orders in its judicial capacity. Though this makes it very powerful, there is an
appeals process to create accountability. There is a Securities Appellate Tribunal
which is a three member tribunal and is presently headed by a former Chief Justice
of a High court - Mr. Justice NK Sodhi. A second appeal lies directly to the Supreme
Court.

SEBI has enjoyed success as a regulator by pushing systemic reforms

aggressively and successively (e.g. the quick movement towards making the
markets electronic and paperless rolling settlement on T+2 basis). SEBI has been
active in setting up the regulations as required under law.

With the objective of improving market efficiency, enhancing transparency,

checking unfair trade practices and bringing the Indian market up to international
standards, a package of reforms consisting of measures to liberalize, regulate and
develop the securities market was introduced during the 1990s. This has changed
corporate securities market beyond recognition in this decade.

National Stock Exchange

The National Stock Exchange commenced its operations in 1947 as a first

step in reforming the securities market the exchange.

Before the NSE was set up trading on the stock exchange in India used to
take place through open outcry without use of information technology for immediate
matching or recording of trades. This was time consuming and inefficient. The
practice of physical trading imposed limits on trading volumes as well as, the speed
with which new information was incorporated in to prices. To obviate this, the NSE
introduced screen-based trading system where a member can punch into the
computer the quantities of shares and the prices at which he wants to transact. The
transaction is executed as soon as the quote punched by a trading member finds a
matching sale or buys quote from counterparty. The increases the informational
efficiency of market. With SBTS, it becomes possible for market participants to see
the full market, which helps to make the market mare transparent, leading to
increased investor confidence. The NSE started nation-wide SBTS, which have
provided a completely transparent trading mechanism. Regional exchange lost a lot
of business to NSE, forcing them to introduce SBTS. Today India and boast that
almost 100% trading takes place through electronic order matching.

Bombay Stock Exchange:

BSC Sensex or Bombay Stock Exchange Sensitive index is a value-weighted

index composed of 30 stocks started in 01 of Jan, 1986. it consist of the 30 largest
and most actively traded stock , representative of various sectors, on the Bombay
stock exchange .these companies account for around one-fifth of market
capitalization of the BSE. The base value of the sensex is 100 on April 1, 1979, and
the base year of BSE-SENSEX is 1978-79.

At irregular intervals, the Bombay stock exchange (BSE) authorities review

and modify its composition to make sure it reflect current market conditions. The
index is calculated based on free float capitalization method; a variation of the
market cap method. Instead of using a company’s outstanding share it uses its float,
or share that are readily available for trading. The free float method, therefore, dose
not includes restricted stocks, such as those held by company insiders.

The index has increased by over ten times from June 1990 to the present.
Using information from April 1979 onward, the long run rate of return on the BSE
Sensex works out to be 18.6% per annum, which translates to roughly 9% per
annum after compensating for inflation.

Equities: -
What is Equity: - Funds brought in to a business by shareholders is called equity. It
is a measure of a stake of a person or group of persons starting a business.

What does investing in equity mean: - When you buy a company’s equity, you are
in effect financing it, and being compensated with a stake in the business. You
become part-owner of the company, entitled to dividends and other benefits that the
company may announce, but without any guarantee of a return on your investments.

Fundamental analysis: - The analysis of factual information like financial figures,

balance sheet, and other information publicly available is known as fundamental
analysis. This information is used to derive a fair price of the share of the share of
the company. The faithful fundamentalists believe that the market incorporates all
facts relating to the financial performance of the company. But a systematic analysis
will ensure a more accurate valuation of the price. Fundamental analysis use tools
such as ratio analysis (P/E, M/V/BV) and discounted cash flow analysis in order to
arrive at the fair value of a company and hence its share.

Technical Analysis: - Technical analysis is the study of historic price movements of

securities and trading volumes.

Technical analysis believes that prices of the securities are determined largely
by forces of demand and supply. Share prices move in patterns which are easily
identifiable. Crucial insights in to these patterns can be obtained by keeping track of
price charts, leading to predictions that a stock price may move up to down. The
belief is that by knowing the past, future prices can predict.

Settlement cycle: - The accounting period for the securities traded on the
Exchange. On the NSE, the cycle beings on Wednesday and ends on the following
Tuesday, and on the BSE the cycle commences on Monday and ends on Friday.

At the end of this period, the obligations of each broker are calculated and the
brokers settle their respective obligations of each broker are calculated and the
brokers settle their respective obligations as per the rules, bye-laws and regulations
of the clearing corporation.

If a transaction is entered on the first day of the settlement, the same will be
settled in the eighth working day excluding the day of transaction. However, if the
same is done on the last day of the settlement, it will be settled on the fourth working
day excluding the day of transaction.

Rolling settlement: - The rolling settlement ensures that each day’s trade is settled
by keeping a fixed gap of a specified number of working days between a trade and
its settlement, at present, this gap is five working days after the trading day. The
waiting period is uniform for all trades.

Deliver the shares and pay the money to broker: - As a seller, in order to ensures
smooth settlement you should deliver the shares to your broker immediately after
getting the contract note for sale but in any case before the pay-in day. Similarly, as
a buyer, one should pay immediately on the receipt of the contract note for purchase
but in any case before the pay-in day.

Short selling: - short selling is a legitimate trading strategy, it is a sale of a security

that the seller does not own, or any sale that is completed by the delivery of a
security borrowed by the seller take the risk that they will be able to buy the stock at
a more favourable price than the price at which they “sold short”

Auction: - An auction is conducted for those securities that members fail to

deliver/short deliver during pay-in. three factors primarily give rise to an auction,
short deliveries, un-rectified bad delivering up-rectified company objection. The
buy/sell auction for a capital market security is managed through the auction market.
As opposed to the normal market where trade matching is an on-going process, the
trade matching process for auction starts after the auction period is over.

If the shares are not bought at the auction, if the shares are not offered for
sale, the exchange squares up the transaction as per SEBI guidelines, the
transaction is squared up at the highest price from the relevant trading period till the
auction day or at 20 percent above the last available closing price whichever is
higher. The pay in and pay out of funds for auction square up is held along with the
pay-out for the relevant auction.

Hawala Rate: - Hawala rate is a making-up price at which buyers and sellers settle
their speculative transaction at the end of the settlement. It is the basis for buy and
sells for the investor opting for carry forward during the next settlement. This price is
fixed by taking the weighted average of trades in the last half-an-hour of trading on
the settlement day for securities in the carry forward list, also knows as the “A” group
or specified group. This price is significant because for a speculative buyer or a
seller, the Hawala rate is the standard rate for settling his trade and for carrying
forward business to the next settlement. For example, an investor buys the stock of x
company at Rs.100 on Monday. By Friday (BSE settlement day), if Rs. 90 is the
weighted average price in the last half-an-hour, the buyer would have to carry
forward his trade at this price of Rs. 90. He then settles at Rs. 90 and enters in to a
contract at Rs. 90 plus BLESS charges for the next settlement.

Normally, Stock Exchange does not interfere with the Hawala rates. However,
there are instances, when rates have been changed to ensure safety of the markets.
This is so because in case the market witnesses a sharp fall during a settlement, the
chances of a broker default are extremely high. This is when the exchange
administration steps in and raises the Hawala rate to avert any possible default.

Book-closure and record date: - When shares of a joint stock company invariably
change hands during market trades, identifying the owner of some shares becomes
difficult. So it is difficult to pass on certain benefits (like share bonus issue, splits and
dividend payments) to shareholders.

So, when a joint stock company declares dividends or bonus issues, there
has to be a cut-off date for such benefits to be transferred to the shareholders. This
date is termed as "Book Closure" date or "Record Date". It is the date after which the
company will not handle any transfer of shares requests until the benefits are
transferred. Only shareholders marked in the company's register at the Book Closure
Date or the Record Date would be entitled to receive these benefits. If a company
announces book closure as 1 January, shareholders who as on that day own the
stock will be entitled to the dividend/bonus/split benefit. e.g. If Mr. Y buys this stock
from Mr. X on 2 January, the benefit of bonus issue or splits or dividend will still be
transferred to Mr. X by the company.

A company generally announces such a date along with the announcement of

the bonus issue or splits or dividend announcement, as the case may be.

In an efficient market as per the efficient-market hypothesis (EMH) the effect

of the price change due to bonus issue or splits or dividend as on the Book Closure
 date gets adjusted in the price of the stock in the market effective with the opening of
the trade floor on the book closure date

3.2 Commodity Market

India has a long history of futures trading extending over 125 year , while gold
and silver were widely trade commodities in the 19 century , other Agro product like
chana , urad , sugar wheat etc; were only added recently in most market.

The bull run in commodity markets coupled with the setting up of national
level commodity exchanges in India and has lead to a large scale improvement in
transportation , warehousing and financing etc; placing India internationally in
commodities markets.

Commodity future perform an important role of price discovery and risk

management, which is beneficial for all the section of society i.e. producer, trader
and consumer etc.

Globally volumes on commodity future market are about five times of equity
market. Some of major commodities exchange is Chicago Board of Trade (CBOT),
New York Mercantile Exchange (NYMEX), London Metal Exchange (LME), Tokyo
Commodity Exchange (TOCOM), and Bursa Malaysia (KLSE).

What are future markets?

Future markets are efficient price discovery platform, comprising of farmers, trader,
producers, exporters, importers and industries associated with commodities. The future
market is used for hedging the price risk, trading and arbitrage.

What is a future contract?

A future contract is standardized contract, trade on a future exchange, to buy or sell

a certain underlying instrument at a certain date in the future, at a pre set price. The future
date is called the delivery date or financial settlement date. The pre-set price is called the
future prices.

What a Margin?
 A margin is the cash or collateral that a holder of a position in exchange traded
future contract is required to pay to cover potential adverse movements in the value of the
position. Generally the margin varies from 6% to 15% of total lot value.

What is open interest?

Open interest is the total number of contracts outstanding.

MCX:

Multi Commodity Exchange (MCX) is an independent commodity exchange based in

India. It was established in 2003 and is based in Mumbai. The turnover of the exchange for
the period Apr-Dec 2008 was INR 32 Trillion. MCX offers futures trading in Agricultural
Commodities, Bullion, Ferrous & Non-ferrous metals, Pulses, Oils & Oilseeds, Energy,
Plantations, Spices and other soft commodities.

MCX has also setup in joint venture the National Spot Exchange a purely agricultural
commodity exchange and National Bulk Handling Corporation (NBHC) which provides bulk
storage and handling of agricultural products.

It is now regulated by forward market commission.

 MCX is India's No. 1 commodity exchange with 84% Market share in 2008($0.84
trillion)
 The exchange's competitor is National Commodity & Derivatives Exchange Ltd
 Globally, MCX ranks no. 1 in silver, no. 2 in natural gas, no. 3 in crude oil and
gold in futures trading
 The crude volume touched 23.49 Million barrels on January 3, 2009
 The highest traded item is gold with an average monthly turnover of Rs 1.42
Trillion ($29 Billion).
 MCX has 10 strategic alliances with leading commodity exchange across the
globe
 The average daily turnover of MCX is about US$ 2.4 billion
 MCX now reaches out to about 500 cities in India with the help of about 10,000
trading terminals
 MCX COMDEX is India's first and only composite commodity futures price index

NCDEX:
 NCDEX is the only commodity exchange in the country promoted by national level
institutions. This unique parentage enables it to offer a bouquet of benefits, which are
currently in short supply in the commodity markets. The institutional promoters and
shareholders of NCDEX are prominent players in their respective fields and bring with them
institutional building experience, trust, nationwide reach, technology and risk management
skills.

NCDEX is a public limited company incorporated on April 23, 2003 under the
Companies Act, 1956. It obtained its Certificate for Commencement of Business on May 9,
2003. It commenced its operations on December 15, 2003.

NCDEX is a nation-level, technology driven de-mutualised on-line commodity

exchange with an independent Board of Directors and professional management - both not
having any vested interest in commodity markets. It is committed to provide a world-class
commodity exchange platform for market participants to trade in a wide spectrum of
commodity derivatives driven by best global practices, professionalism and transparency.

NCDEX is regulated by Forward Markets Commission. NCDEX is subjected to

various laws of the land like the Forward Contracts (Regulation) Act, Companies Act,
Stamp Act, Contract Act and various other legislations.

NCDEX is located in Mumbai and offers facilities to its members about 550 centers
throughout India. The reach will gradually be expanded to more centers.

NCDEX currently facilitates trading of 57 commodities –

Agriculture-

Barley, Cashew, Castor Seed, Chana, Chili, Coffee - Arabica, Coffee - Robusta,
Crude Palm Oil, Cotton Seed Oilcake, Expeller Mustard Oil, Groundnut (in shell),
Groundnut Expeller Oil, Guar gum, Guar Seeds, Gur, Jeera, Jute sacking bags,
Indian Parboiled Rice, Indian Pusa Basmati Rice, Indian Traditional Basmati Rice,
Indian Raw Rice, Indian 28.5 mm Cotton, Indian 31 mm Cotton, Masoor Grain Bold,
Medium Staple Cotton, Mentha Oil, Mulberry Green Cocoons, Mulberry Raw Silk,
Mustard Seed, Pepper, Potato, Raw Jute, Rapeseed-Mustard Seed Oilcake, RBD
Palmolein, Refined Soy Oil, Rubber, Sesame Seeds, Soybeans, Sugar, Yellow
Soybean Meal, Tur, Turmeric, Urad, V-797 Kapas, Wheat, Yellow Peas, Yellow Red
Maize.
Metal’s-

Aluminium, Ingot, Electrolytic Copper Cathode, Gold, Mild Steel Ingots, Nickel
Cathode, Silver, Sponge Iron, Zinc Ingot.

Energy-

Brent Crude Oil, Furnace Oil.

At subsequent phases trading in more commodities would be facilitated.

3.3 Currency Market

The foreign exchange market (currency, Forex, or FX) is where currency trading
takes place. It is where banks and other official institutions facilitate the buying and selling
of foreign currencies. FX transactions typically involve one party purchasing a quantity of
one currency in exchange for paying a quantity of another. The foreign exchange market
that we see today started evolving during the 1970s when world over countries gradually
switched to floating exchange rate from their erstwhile exchange rate regime, which
remained fixed as per the Bretton Woods system until 1971.

Presently, the FX market is one of the largest and most liquid financial markets in the
world, and includes trading between large banks, central banks, currency speculators,
corporations, governments, and other financial institutions. The average daily volume in the
global foreign exchange and related markets is continuously growing. Traditional daily
turnover was reported to be over US$3.2 trillion in April 2007 by the Bank for International
Settlements.Since then, the market has continued to grow. According to Euro money’s
annual FX Poll, volumes grew a further 41% between 2007 and 2008.

The purpose of FX market is to facilitate trade and investment. The need for a
foreign exchange market arises because of the presence of multifarious international
currencies such as US Dollars, Euros, Japanese yen, Pounds Sterling, etc., and the need
for trading in such currencies.

What are Foreign Exchange/Forex/FX?

 Foreign exchange is the simultaneous purchase of one currency and sale of another
– currencies are always traded in pairs. International currencies are traded on floating
exchange rates. There is a daily average turnover of about US$1.5 trillion in the foreign
exchange markets. The foreign exchange market is known as the "Forex," or "FX" market. It
is the largest financial market in the world.

Is there a central location for the Forex Market?

Forex trading is not managed through an exchange. Since transactions are

conducted between two counterparts, the FX market is an “inter-bank,” or over the counter
(OTC) market.

Who participates in the FX market?

Central, commercial and investment banks have traditionally dominated the Forex
market. Other market participation is rapidly increasing, and now includes international
money managers and brokers, multinational corporations, registered dealers, options and
futures traders, and private investors.

When is the FX market open for trading?

Forex is a true global 24-hour marketplace. The trading day begins in Sydney, and
moves around the globe as each financial center comes to life. Tokyo follows, then London,
and finally New York. Investors can respond in real time to any fluctuations caused by
current economic, social and political events.

What are the most common currencies in the Forex markets?

The most “liquid” currencies in the Forex market are those of countries with low
inflation, stable governments, and respected central banks. Nearly 85% of daily
transactions involve the major currencies, including the U.S. Dollar, Japanese Yen, the
European Union Euro, British Pound, Swiss Franc, and the Canadian and Australian
Dollars.

Is capital intensive to trade Forex?

Forex Capital Management requires a minimum deposit of $300 to open a Mini

Account and $2000 for a regular account. Your relationship with Forex Capital Management
enables you to conduct highly leveraged trades (as much as a 200 to 1 leverage ration in
the Mini Account.) You set the degree of leverage that you wish to deploy. Unless otherwise
specified, your leverage level is set at the most lenient level required by your account size.
Please remember that while this degree of leverage enables you to maximize your profit
potential, there is an equally great potential for loss.

3.4 Derivatives

The emergence of the market for derivative products, most notably forwards, futures
and options, can be traced back to the willingness of risk adverse economic agent to guard
themselves against uncertainties arising of fluctuations in assets prices. By there very
nature, the financial markets are marked by a very high degree of volatility. Through the use
of derivative product, it is possible to partially or fully transfer price risks by locking in assets
price .as instruments of risk management; these generally do not influence the fluctuation in
the underlying asset prices. However, by locking in asset prices, derivative products
minimize the impact of fluctuation in asset prices on the profitability and cash flow situation
of risk adverse investors.

Derivative Products:

Derivative contracts have several variants. The most common variants are forwards,
futures, options, and swaps. Take a brief look at various derivative contracts that have
come to be used.

Forward: A forward contact is a customized contract between two entities, where

settlement takes place on a specific date in the future at today’s pre-agreed price.

Future: A future contract is an agreement between two parties to buy or sell an

asset at a certain time in the future at a certain price. Future contracts are special
type of forward contracting the sense that the former are standardized exchange
traded contracts.

Option: Option is two types – calls and puts. Calls given the buyer the right but not
the obligation to buy a given quantity of the underlying asset, at a given price on or
before a given future date .puts give the buyer the right, but not the obligation to sell
a given quantity of the underlying asset at a given price on or before a given date.
 Warrants: Option generally have lives of up to one year. Majority of the option
traded on options exchanges having a maximum maturity of nine months. Longer-
dated options are called warrants and are generally traded over the counter.

Leaps: The acronym leaps means long-term equity anticipation securities .these are
options having a maturity of up to three years.

Baskets: Baskets option is option on portfolio of underlying assets. The underlying

asset is usually a moving average of a basket of asset .equity index options are a
form of basket option.

Swaps: Swaps are private agreement between two parties to exchange cash flows
in the future according to pre arranged formula. They can be regarded as portfolios
of forward contracts. The two commodity use swaps are:

Swaptions: Swaptions are option to buy or sell a swap that will become operative at
the expiry of the option .thus a swaption is an option on a forward swap. Rather than
have calls and puts, the swaption market has receiver swaptions and payer
swaption. A receiver swaption is an option to receive fixed and pay floating. a payer
swaption is an option to pay fixed and receive floating.

3.5 The Depository system

The principal function of a depository is to dematerialize securities and enable their

transaction in book-entry form. The securities are transferred by debiting the transferor’s
depository account and crediting the transferee’s depository account.

Functions of Depository

Dematerialization: one of the primary functions of depository is to eliminate or

minimize the movement of physical securities in the market. This is achieved through
dematerialization of securities. Dematerialization is the process of converting
securities held in physical form into holdings in book entry form.

Account transfer: the depository gives effects to all transfers resulting from the
settlement of trades and other transactions between various beneficial owners by
recording entries in the accounts of such beneficial owners.
Transfer and Registration: A transfer is the legal change of ownership of a security
in the records of the issuer. For affecting a transfer, certain legal steps have to be
taken like endorsement, execution of a transfer instrument and payment of stamp
duty. The depository accelerates the transfer process by registering the ownership of
shares in the name of the depository. Under a depository system, transfer of security
occurs merely by passing book entries in the records of the depositories, on the
persons entitled to receive corporate benefits. In the other case, depository it self
takes the responsibility of distribution of corporate benefits.

Core Services of Demat Account

3-IN-1 ACCOUNT

Accounting Opening: Any investor who wishes to avail depository services must
first open an account with a depository participant of NSDL. The process of opening
a demat account is very similar to a bank account. The investor can open an account
with any depository participant of NSDL. An investor may open an account with
several DPs or he may open several accounts with a single DP is free to fix its own
fee structure. Investors have the freedom to choose a DP based on criteria like
convenience, comfort, service levels, safety, reputation and charges. After exercising
this choice, the investor has to enter into an agreement with the DP the form and
contents of this agreement are specified by the Business Rules of NSDL. In this
chapter we deal with the procedure for account opening under the NSDL system.

Types of Accounts: Type of depository account depends on the operations to be

performed. There are three types of demat accounts which can be opened with a
depository participant viz. (a) Beneficiary Account (b) Clearing Member Account and
(c) Intermediary Account.

Beneficiary Accounts

This is an account opened by investors to hold their securities in

dematerialized form with a depository and to carry out the transaction of sale and
purchase of such securities in book-entry form through the depository system. A
beneficiary account holder is legally entitled for all rights and liabilities attached to
the securities (i.e. equity shares, debentures, government securities, etc.) held in
that accounts. Therefore, the account is called “beneficial owner account”. A
beneficiary account can be in the name of an individual, corporate, Hindu Undivided
Family (HUF), minor, bank, financial institution, trust etc. or the broker himself for the
purpose of his personal investments in demat form. The accounts are opened with
DP.

Documents for Verification

1. Non-body Corporate Investors: For the purpose of verification, all mom-body

corporate investors have to submit the following documents, as prescribed by
SEBI, along with the stipulated account opening form.

A beneficiary account must be opened only after obtaining a proof of identity

and address of the applicant. An authorized official of the participant should verify
the photocopies of any of following documents submitted with their corresponding
originals and put his/her signature on them with remarks “verified with original”
proceeding to open the account.

a. Proof of Identity (POI)

I. Passport

II. Voter ID Card

III. PAN card with photograph
IV. MAPIN card
V. Identity card/document with applicant’s Photo, issued by

(1). Central/State Government and its Departments

(2). Statutory/Regulatory Authorities

(3). Public Sector Undertakings,

(4). Scheduled Commercial Banks,

(5). Public Financial Institutions,

(6). College affiliated to Universities (this can be treated as valid only till
the time applicant is a students),
 (7). Professional Bodies such as ICAI, ICWAI, Bar Council etc. to their
Members

(8). Credit cards/Debit cards issued by Banks.

b. Proof of address (POA)

I. Ration card

II. Passport

III. Voter ID card

IV. Driving License

V Bank Passbook

VI Verified Copies of

1) Electricity Bills (not more then two month old)

2) Telephone Bills (not more then two month old)

3) Leave and License Agreement / Agreement for sale.

VII. Self –declaration by High court & Supreme Court Judges, giving the
new address in respect of their own accounts.

2. For Corporate Investor: For the purpose of verification, all corporate investors
have to submit the following documents as prescribes by SEBI along with the
stipulated account opening form.

1. Memorandum & Articles of Association (MOA & AOA) Board resolution for
opening demat account and the list of authorized signatories along with their
specimen signatures and photographs
2. Introduction by an existing account holder of by the applicant’s bank.
3. Proof of address of the corporate, evidenced by the document registered
with Registrar of companies or acknowledged copy of income tax return or
Bank Statement or Leave and License Agreement/Agreement for sale.
 An authorized official of the participant shall verify the proof of address with
the original documents and affix his/her signature on the documents submitted by
the Client, while exercising such due diligence.

Common Information

The processes of opening an account with a depository, nature of such an

account, and various factors to be considered for opening a depository account are
explained below. Some details are common to all types of account. These are:

1. Name of the holder

2. Date of Birth (for individual account)
3. Occupation
4. Address & phone number
5. Bank details like name of bank, type of account (current/savings) account
number, branch address, MICR etc.
6. PAN number
7. Details of nomination (for individual account )
8. Specimen signatures
9. MAPIN UIN (s)
10. E-mail address
11. Mobile number
12. Address for communication

Beneficiary Account- Procedure for Opening Account

Investors have the choice of selecting a DP based on their convenience,

comfort, service levels, safety, reputation, charges etc. they have the flexibility to
have more than one account with the same DP or any other DPs. No minimum
balance required for opening a depository account. Investors also have the freedom
to close an account with one DP and open another one with any other DP.

The type of the account opening form to be filled by an investor and the list of
documents required depend on the type of beneficiary account to be opened –
whether it is for NRIs or corporate or individual. Further, the individual account can
be in a single name or joint names. Clearing members a broker have to open a
beneficiary account if they have to deal with their own holdings.
 There are several client types in the depository system and different codes
are allotted to them. These are below:

1. Resident

 Ordinary

 Hindu Undivided Family (HUF)

2. Financial Institutions (FI)

 Government-sponsored

 State Financial Corporation

 Others

3. Foreign Institutional Investors

 Mauritius-based

 Others

4. Non-resident Indian (NRI)

 Repatriable

 Non-Repatriable

 Depository Receipt

5. Body Corporate

 Domestic Company
 Overseas Corporate Body
 Government Company
 Central Government
 State Government
 Broker

 Foreign Bodies
 Group Companies
 Depository

7. Clearing Member
 8. Foreign National – Foreign National / Depository Receipt
9. Mutual Fund
10. Trust
11. Bank

 Foreign Bank
 Co-operative Bank
 National Bank

Check List for Account Opening

 Proof of Identity: An authorized official of the Participant should verify the

photocopies of the any of the prescribed documents submitted with their
corresponding originals.
 Proof of address (POS): An authorized official of the Participant should verify
the photocopies of the any of the prescribed documents submitted with their
corresponding originals
 Ensure that all compulsory fields in the account opening form are filled (except
nomination which is optional.)
 In case of corporate, ensure a copy of Board resolution of authorized
signatories. Ensure proper authorization in case of power of attorney holder.
 DP should give a copy of agreement to the client, including the charge.
 Inform clients regarding standing instruction facility.
 Branches of DP to co-ordinate & follow up with Head Office for account
opening.
 Ensure account is activated before forwarding Client ID to client.
 Inform settlement deadlines to clients

Intermediary Account: -

As per SEBI Regulations on Stock Lending and Borrowing only an approved

intermediary can lend borrow stocks from clients. This intermediary borrows from
lenders and lends to borrowers. Intermediaries registered with SEBI as approved
intermediary account with a DP of its choice for executing stock lending and
borrowing transaction made through them. An intermediary account may be opened
only after obtaining registration from SEBI under an approved Stock Lending
Scheme and getting the approval of the depository for opening the account.
Operation of demat accounts based of power of attorney

A demat account can be operated by a power of attorney holder. In this

regard, it may be noted that:-

i. A power of Attorney executed to the promulgation of the Depositories Act is

valid and enforceable.
ii. It is the responsibility of the Depository Participant to verify whether the Power
of Attorney is adequate and sufficiently authorizing the holder of the Power of
Attorney the done to operate the account of the beneficial owner.
iii. A sample clause is given hereunder which if it forms a part of the Power of
Attorney could suffice.

However it may be mentioned that a DP shall not obtain Power of Attorney

(POA) from its clients as a requirement for opening a demat account. Further the
POA shall not contain the following clauses:

I. POA Holder Done has the sole authority to operate the account and the
account folder is/are restrained from operating the account.
II. Delivery Instruction Slip (DIS) books are denied to the account holders who
have executed a POA
III. DPs are authorized to mere the securities kept under various accounts of the
clients.
IV. DPs will have a lien on the securities of the clients.

DPs are therefore required to review the POA document and if the POA
contains any clause similar to what has been stated above the POA should be
modified suitably. DPs must inform all those clients who have executed POA about
such changes and obtain a written confirmation from the clients that they have taken
note of the changes in the POA.

It may also be mentioned that where a client has executed a POA such
depository accounts can be operated both by the clients as well as by the POA
holder. Therefore DPs should ensure that the signatures of the accounts holders and
the POA holder are captured in the DPM system and DPs are required to provide
DIS books to the clients who have executed a POA and allow the clients to operate
their accounts as well.
 Further DPs are required to maintain separate accounts of the clients in
conformity with regulation 42 of Security and Exchange Board of India (Depositories
and Participants) Regulations 1996. Lien on the securities can be only as per
Regulation 58 of SEBI Regulation and as per the procedure laid down in the bye
Laws and business Rules of NSDL.

Closure of Account

Closure on Client’s Request: - DP can close a depository account on receipt of an

application in the prescribed format. The application should be made by the account
holder or by the entire joint holder. An account can be closed only when there is no
balance in the account. In case there is any balance in the account sought to be
closed, the following steps are necessary.

a. Dematerialization of all securities to the credit of the account at the time of

making the application for closure
b. Transferring the balance to the credit of another account opened by the same
account holders either with the same participant or with a different participant.

However, where demat request are pending for disposal for a long tine in a
demat account and the client desires to close such an account the following
procedure maybe adopted by the client

 Write a letter in the prescribed format to the issuer, requesting for rejection of
the pending dematerialization requests and send fresh physical security to the
client directly
 Enclose a copy of the dematerialization request generated from DPM system
duly signed & stamped by the participant along with the aforesaid letter to the
issuer.

Before closing the account the DP should ensure that all pending transaction
has been settled. The request for closure should be processed only after ensuring
that there is no balance lying in the account.

If a client makes a request for closure of account, DPs should provide the
Statement of Transaction (SOT) to the client for the period from the beginning of the
quarter in which the account is closed till the date of closure. Further the SOT should
bear the words “Account Closed” and should be prominent. For this purpose, DP can
affix a rubber stamp or create a suitable system that will clearly show on the SOT
that the account has been closed.

Consolidation of Account

Some clients could have opened multiple accounts to dematerialize their

shares held in multiple combinations an sequence of names. However they may not
need so many accounts after they have dematerialized their shares and may want to
bring all their share holdings into one of fewer accounts. This can be achieved by
using normal off market transfer instruction.

Closure by DP

The DP may also initiate closure of a client’s if the client has defaulted in
performing its obligations laid out in the client-participant agreement. The participant
should give sufficient notice to the client before initiating closure of his account. The
notice should clearly state the reasons of closure of account. The process of closing
account in such a case is the same that of client-initiated closure.

Closure/Shifting of Clearing Account: - a clearing member may transfer its

clearing account from one DP to another DP. For this simultaneously applications
have to be made of closure of account to the earlier DP and for opening of new
clearing member account to the new DP forwards the application to the depository
for approval and allotment of a new CM-BP-ID. Once the new CM-BP-ID is allotted
the new DP opens a new clearing account and intimates the depository advises the
old DP to close the account. The old DP then closes the account and intimates the
clearing member. All pay-out of securities, subsequent to closure of old clearing
account takes place in the new account.

Freezing Accounts

Account freezing means suspending any further transaction from a depository

account till the account is unfrozen

1. If a written instruction is received from the client by the DP, requesting

freezing of account.
 2. If an electronic request is made by a client to his DP or to the Depository in
the form and manner as may be prescribed the depository.
3. If orders are received by the DP depository from the Central of State
Government, SEBI or any order by court, tribunal, or statutory authority.
4. If a request is received by the depository from a DP client.
5. If orders are passed by Disciplinary Action Committee (DAC) or if DP
becomes insolvent.

By freezing an account for debits only (preventing transfer of securities out of

the account) the client can receive securities in his account. An account can also be
frozen for debits as well as credits (preventing any movement of balances out of the
account). No transaction can take place in such an account until it is reactivated.

A frozen account may be unfrozen or reactivated by taking the reverse steps.

1. On the valid written request of the account holder where he had requested
freezing.
2. On directions of depository made in pursuance of the order of the appropriate
authority
3. Changes in Client Details

A client may change any of the following particulars in the depository system.
All he has to do is to submit the change in writing to the DP.

 Father’s/Husband’s Name (change from father’s name to husband’s name

may be necessary on account of marriage).
 Standing instruction facility (an investor can activate/deactivate it).
 Address (both local as well as correspondence), telephone number, mobile
number, clients have to provide proof of new address while submitting
application for change address.
 Occupation details
 Nominee details (the DP has to obtain the required form from the client duly
filled and effect the changes).
 Bank details (clients may revise the bank details given by him before record
date to ensure that the dividend/interest warrants bear the correct bank
details).
  PAN number details
 In case of NRIs the Reserve Bank of India reference number and approval
date.

 MAPIN UIN
 E-mail addresses.

Change of address for individual clients

1. While processing requests for change of address receive from client, DP

should obtain the following documents.

a. A written application for change of address from the client.

b. Proof of identity
c. Latest transaction statement of the account received from the participant.
d. Proof of new address along with the original documents of the new
address.

2. The client should personally visit the office of the DP where the client
maintains and operates his/her account and submit the application for change
of address. However in case the client expresses inability to personally visit
the participant, the application for change of address along with other
documents can be submitted though an authorized representative.

3. The client or its authorized representative should sign the application once
again in the presence of the officials of the DP.
4. The DP should verify the signature of the client on the application and the
identity documents with the documents maintained with the DP. Further the
documents pertaining to new address should be verified with the original. After
due verification an authorized official of the DP should put his/her signature
on the application with remarks “verified with original” and thereafter record
the change of address in the DPM system.
5. However in case DP could not verify the documents because the records of
the documents submitted by the client are kept at a different place, then the
participant must verify the same within a period of seven working days and
only then effect the change.
Change of signature

1. The client should make a request in writing specifying reasons for change in
signature.
2. New signature should be duly attested by client’s banker.
3. Client should visit DP’s office personally and produce valid proof of identity as
well as the latest transaction statement of its account.
4. In the presence of officials of DP client should affix his/her new signature.

A holder of eligible securities in the depository system may get his physical
holdings converted into electronic form by making a request through the DP with
whom he has his beneficiary account.

Prerequisites for Dematerialization Request

1. The registered holder of the securities should make the request

2. Securities to be dematerialized must be recognized by NDDL as eligible. In
other word only those securities who’s ISIN has been activated by NSDL can
be dematerialized in the NSDL system.
3. The company/issuer should have established connectivity with NSDL. Only
after such connectivity is established the securities of that company are
recognized to be “available for dematerialization” in the NSDL system.
4. The holder of securities should have a beneficiary account in the same name
as it appears on the security certificates to be dematerialized.
5. The request should be made in the prescribed dematerialization request form.

Dematerialization Process:

Steps
 1. Client/investor submits the DRF (Demat Request Form) and physical
certificates to DP. DP checks whether the securities are available for demat.
2. DP enters the demat request in his system to be sent to NSDL.
3. DP dispatches the physical certificates along with the DRF to the R&T agent.
4. NSDL records the details of the electronic request the system and forwards
the request to the R&T agent.
5. R&T agent on receiving the physical document and the electronic request
verifies and checks them. Once the R&T agent is satisfied, dematerialization
of the concerned securities is electronically confirmed to NSDL.
6. NSDL credits the dematerialized securities to the beneficiary account of the
investor and intimates the DP electronically. The DP issues a statement of
transaction to the client

Trading and Settlement

One of the basic services provided by NSDL is to facilitate transfer of

securities from one account to another at the instruction of the account holder. In
NSDL depository system both transferor and transferee have to give instruction to its
depository participants (DPs) for delivering (transferring out) and receiving of
securities.

Transfer of securities from one account to another may be done for any of the
following purposes.

a. Transfer due to a transaction done on a person to person basis is called “off-

market” transaction
b. Transfer arising out of a transaction done on a stock exchange
c. Transfer arising out of transmission and account closure.

The ID for an off-market trade or for a market trade has to be clearly indicated
in the form by marking appropriately. The form should be complete in all respects. All
the holders of the account have to sign the form. If the debit has to be effected on a
particular date in future, account holder may mention such date in the space
provided for ‘execution date’ in the form.

Settlement of off-market Transactions:

Off-Market Trade
 1. Seller gives delivery instructions to his DP to move securities from his account
to the buyer’s account.
2. Buyer automatically receives the credit of the securities in to his account on
the basis of standing instruction for credits.
3. Buyer receives credit of securities in to his account only if he gives receipt
instructions if standing instructions have not been given.
4. DP needs to be extra careful in verifying the signature of the client if large
quantities of securities are being debited to the account.
5. Funds move from buyer to seller outside the NSDL system.

Settlement of Market-Transaction

Market Settlement-Demat Share

A market trade is one that is settled though participation of a clearing

Corporation. In the depository environment, the securities move through account
transfer. Once the trade is executed by the broker on the stock exchange, the seller
given a delivery instruction to his DP to transfer securities to his broker’s account.

The broker has to then complete the pay-in before the deadline prescribed by
the stock exchange. The broker removes securities from his account to (Clearing
Corporation / Clearing House) CC/CH of the stock exchange concerned, before the
deadline given by exchange.

The CC/CH gives pay-out and securities are transferred to the buying broker’s
account. The broker then gives delivery instructions to his DP to transfer securities to
the buyer’s account.

1. Seller gives delivery instructions to his DP to move securities from his account
to his broker’s account.
2. Securities are transferred from broker’s account to CC on the basis of a
delivery out instruction.
3. On pay-out, securities are moved from CC to buying broker’s account.
4. Buying broker gives instruction and securities move to the buyer’s account.

Market type
 Stock exchanges offer different market segments in which trades can be
done. The segmentation is done by the type of settlement or type of trade.

Each of the segments is denoted ad ‘Market Type’ in NSDL depository

system. The stock exchange which offers these market types, generally, recognize
these settlements with a two character code, the DI slip should contain the market
type for which securities are being transferred to the clearing member. The contract
note/trade confirmation slip given by the broker/sub-broker will indicate the market
type.

Settlement Number

Trading periods of each of the market segments is identified by a settlement

number. Every settlement number has a trade beginning day, trade-ending day,
settlement pay-in day and settlement pay-out day. Stock exchanges divide a period
of one year in to several settlement periods and allocate settlement number for each
settlement-period. All these days collectively are called ‘settlement calendar’. DPM
system will give complete details of settlement calendar for each stock exchange.

Delivery Deadline

Stock exchange set a deadline time by which clearing member are expected
to deliver securities. Clearing member can deliver securities within the deadline time
only if they have received securities from their clients. In order to ensure that clients
give securities in time to the clearing member, SEBI has prescribed deadline time by
which clients have to give securities to clearing members. SEBI has advised DPs to
instruct their clients to submit the settlement instructions on T+1 (in physical form up
to 4.00p.m. and 6 p.m. in case of electronic instructions) for pay-in of securities viz.;
instruction, CM Pool to CM Pool account transfers and Delivery-out instruction, etc.
For example, pay-in for trades executed on ‘Monday’ will be on Wednesday. Hence,
Client will have to submit instructions to their Participants (up to 4 p.m. in case of
physical and up to 6 p.m. in case of electronic instructions) on Tuesday. The client
must submit the delivery instruction slip to its Depository Participant before the DPs
acceptance deadline,

Automatic Delivery-out
 1. Delivery-out instructions for moving securities from CM settlement account to
CM delivery account can be generated automatically by the respective
clearing corporations based on the net delivery obligation of its clearing
members. The clearing corporation can generate auto Dos will be generated
around the time of download of the delivery obligations to the clearing
members. Such clearing members will not be required to give delivery –out
instruction forms to the participants for pay-in to the clearing corporation in
respect of the automatically generate Dos.
2. Auto DOs will not be generated in the following cases and the clearing
members will have to give delivery-out instruction forms to their participants as
usual:

a. Non pari-passu shares or multiple ISINs:

b. Irreversible delivery-out (IDO):

c. Shifting of CM settlement account from one participant to another
participant:

3. Clearing members will be required to give inter-settlement instructions to the

participants for securities lying in another settlement as usual.

4. Participants can generate separate reports from the DPM both for auto DOs
and manual Dos.
5. All the existing features of DOs viz; remaining valid till the NSDL deadline tine
and partial delivery for insufficient balance will be applicable for auto DOs
also.

3.6 Trading

Trading is the process of buying or selling different type of security in stock market.
In these stock markets daily there are many transaction held on the basis of trading. When
investor’s buys any kind of security, his main motive is to make profit out of that by selling it
on the high prices .this all process of selling and buying is called trading. In India there is
two type of trading available. These two types are:

Online share trading:

 Realizing there is untapped market of investors who want to be able to execute their
own trades when its suits them, broker have taken their trading rooms to the internet known
as online broker, they allow you to buy and sell shares via internet. Investors can have
complete control of their stocks investing action, now that they have the convenience of
buying and selling share on the NSE online and in real time. Each individual has access to
the latest information and tools to analysis any stock investment decision. Plus the power to
execute the sale or purchase right before them on their personal computer screen.

TRADING IN SECURITY MARKET:

1. Trading in shares:

Cash Trading: This is a delivery based trading system, which is generally done with
the intention of taking delivery of shares or monies.

Margin Trading: Customers can also do an intra-settlement trading up to 3 to 4

times, with available funds, wherein customers take long buy/ short sell positions in
stocks with the intention of squaring off the position within the same day settlement
cycle.

Margin PLUS Trading: Through Margin PLUS customers can do an intra-settlement

trading up to 25 times with available funds, wherein customer take long buy/ short
sell positions in stocks with the intention of squaring off the position within the same
day settlement cycle. Margin PLUS will give a much higher leverage in the customer
account against their limits.

Spot Trading: This facility can be used only for selling demats stocks which already
exist in demat account. When customer are looking at an immediate liquidity option,
'Cash on Spot' may work the best for them, On selling shares through "cash on
spot", money is credited to customer bank a/c the same evening & not on the
exchange payout date. This money can then be withdrawn from any of the
ICICIBank ATMs.

BTST : Buy Today Sell Tomorrow (BTST) is a facility that allows customers to sell
shares even on 1st and 2nd day after the buy order date, without this customer have
to wait for the receipt of shares into customers demat account.
 Call Trade®: Call Trade® allows customer to call on a local number in customer city
& trade on the telephone through our Customer Service Executives. This facility is
currently available in over 11 major states across India.

Trading on NSE/BSE: Through ICICIdirect.com, customer can trade on NSE as well

as BSE.

Market Order: Customer could trade by placing market orders during market hours
that allows you to trade at the best obtainable price in the market at the time of
execution of the order.

Limit Order: It Allows Customer to place a buy/sell order at a price defined. The
execution can happen at a price more favorable than the price, which is defined by
the Customer, limit orders can be placed by Customer during holidays & non market
hours too.

Trading in Derivatives

FUTURES

Through ICICIdirect.com, customer can now trade in index and stock futures
on the NSE. In futures trading, customer takes buy/sell positions in index or stock(s)
contracts having a longer contract period of up to 3 months.

Trading in FUTURES is simple! If, during the course of the contract life, the
price moves in Customer favor (i.e. rises in case Customer have a buy position or
falls in case Customer have a sell position), Customer make a profit.

Presently only selected stocks, which meet the criteria on liquidity and
volume, have been enabled for futures trading.

Calculate Index and Know Customer Margin is tools to help in calculating

margin requirements and also the index & stock price movements. The ICICIDIRECT
UNIVERSITY on the HOME page is a comprehensive guide on futures and options
trading.

OPTIONS
 An option is a contract, which gives the buyer the right to buy or sell shares at
a specific price, on or before a specific date. For this, the buyer has to pay to the
seller some money, which is called premium. There is no obligation on the buyer to
complete the transaction if the price is not favorable to him.

To take the buy/sell position on index/stock options, Customer has to place

certain % of order value as margin. With options trading, Customer can leverage on
trading limit by taking buy/sell positions much more than what Customer could have
taken in cash segment.

The Buyer of a Call Option has the Right but not the Obligation to Purchase
the Underlying Asset at the specified strike price by paying a premium whereas the
Seller of the Call has the obligation of selling the Underlying Asset at the specified
Strike price.

The Buyer of a Put Option has the Right but not the Obligation to Sell the
Underlying Asset at the specified strike price by paying a premium whereas the
Seller of the Put has the obligation of buying the Underlying Asset at the specified
Strike price. By paying lesser amount of premium, Customer can create positions
under OPTIONS and take advantage of more trading opportunities.

Electronic trading

Electronic trading eliminates the need for physical trading floors. Brokers can
trade from their offices, using fully automated serene-based processes. Their
workstations are connected to a Stock Exchange’s central computer via satellite
using very small aperture terminus (VSATs). The orders placed by brokers reach the
Exchange’s central computer and are matched electronically. The Stock Exchange,
Mumbai (BSE) and the National Stock Exchange (NSE) are the country’s two leading
Exchange. There is 20 other regional Exchange, connected via the Inter-Connected
Stock Exchange (ICSE). The BSE and NSE allow nationwide trading via their VSAT
system.
Introduction to the organization

Motilal Oswal Securities Ltd. (MOSL) was founded in 1987 as a small sub-broking
unit, with just two people running the show. Focus on customer-first-attitude, ethical and
transparent business practices, respect for professionalism, research-based value investing
and implementation of cutting-edge technology has enabled us to blossom into an almost
2000 member team.

Registered Office

Palm Spring Centre, 2nd Floor,

Palm Court Complex, New Link Road,

Malad (West), Mumbai - 400 064.

Corporate Office

Hoechst House, 3rd Floor,

Nariman Point, Mumbai - 400 021.

Regional

Motilal Oswal Securities Ltd.

SBI life Insurance Building, Opp. Main Post Office, Jawai Bandh Road,

Sumerpur-306902 (Rajasthan)
Company Profile

Motilal Oswal Securities Ltd. (MOSL) was found in 1987 as a small sub-broking unit,
with just two people running the show. Focus on customer-first-attitude, ethical and
transparent business practices, respect for professionalism, research-based value investing
and implementation of cutting-edge technology has enabled it to blossom into an almost
2000 member team.

Motilal Oswal Securities Ltd. is a well diversified financial services firm offering a
range of financial products and services such as Wealth Management, Broking &
Distribution, Commodity Broking, Portfolio Management Services, Institutional Equities,
Private Equity, Investment Banking Services and Principal Strategies.

We have a diversified client base that includes retail customers (including High Net
worth Individuals), mutual funds , foreign institutional investors, financial institutions and
corporate clients. We are headquartered in Mumbai and as of September 30th, 2010, had a
network spread over 591 cities and towns comprising 1,504 Business Locations operated
by our Business Partners and us. As at September 30th, 2010, we had 666,633 registered
customers.
 In 2006, the Company placed 9.48% of its equity with two leading private equity
investors based out of the US – New Vernon Private Equity Limited and Bessemer Venture
Partners. The company got listed on BSE and NSE on September 9, 2007. The issue which
was priced at Rs.825 per share (face value Rs.5 per share) got a overwhelming response
and was subscribed 27.18 times in turbulent market conditions. The issue gave a return of
21% on the date of listing. As of end of financial year 2008, the group net worth was Rs.7
bn and market capitalization as of March 31, 2008 was Rs.19 bn.
 Credit rating agency Crisil has assigned the highest rating of P1+ to the Company’s
short-term debt program.

Shareholding Pattern at on 31st December 08. As of December 31st, 2008; the total
shareholding of the Promoter and Promoter Group stood at 70.37%. The shareholding of
institutions stood at 10.07% and non-institutions at 19.56%.

Motilal Oswal Securities Limited Product and Service

EQUITY

Trading Platform offers online Equity & Equity Derivatives trading facilities for
investors. This high-end, efficiently integrated application makes trading convenient, quick
and hassle free.

Equity Advisory Group: In keeping with its tradition of personalized service, Motilal
Oswal Securities Limited provides Customized Equity Advisory Group to clients
based on their profile. Equity Research is an inherent strength of MOSt. Our advisory
team has highly trained equity professionals, who act as your Equity Advisor.

Centralized Advisory Desk (CAD):The MOSt Equity Advisory Group is based in

Mumbai at largest dealing and advisory floor of India. This centralized advisory team
caters to peculiar Investment need of every HNI & MNI client and business partner;
in a seamless, speedy and reliable manner using state-of-the-art technology and
telecommunication infrastructure.

Online: MOSt Online is the techno savvy alternate of our broking services. Online
service is for a segment of investors who have different expectations from an equity
wealth manager restricting their willingness and ability to sort to premium advisory
services.

Benefits

MOSt Advisory Group is equipped to augment and alter the investments in an

effort to create healthy portfolio. MOSt Equity Advisor adjusts the portfolio to value
addition and erosion across the researched companies.
 On the trading side the ideas are picked out of bouquet of products suitable to
the trading appetite.

You will receive regular portfolio valuation reports to enable you to monitor
performance and view the progress towards the investment objective.

DERIVATIVE

Futures &Options (F&O):Futures & options are derivatives, which use equity as
their underlying. Hence our Equity Advisory Group (EAG), will also act as your
advisors for F&O & help you take informed decisions while trading in these derivative
instruments.

Why F&O: Since derivatives instrument provide good leverage opportunity, it is a

great tool for speculation. Leverage is a double edge sword for which one requires
an equity advisor. Our advisors will also help you with various strategies like Bull
Spread, Bear Spread, Cover call writing, hedging strategies etc. This is to help you
to make better trading returns.

EAG Process (Derivatives)

Client Profiling: MOSt Equity Advisor determines each EAG client's profile before
deciding the set of derivative strategies that will ideally suit him/her. Hence if you
have a good risk appetite & are willing to take riskier bets in the expectations of
better returns we will suggest aggressive strategies like buying naked futures.

Trading: The MOSt Equity Advisor is an expert in providing trading ideas, and at the
same time monitoring those ideas as per your profile.

Integrated Approach: We use integrated approach in our trading strategy using a

combination of futures, writing calls, buying puts to help you reach your trading goal.

Portfolio Tracking Software: Your F&O position will be continuously monitored using
Portfolio Tracking Software.

Benefits
 As the underlying is equities is pays to have the same advisor who is capable of
dealing in both cash as well as derivatives. Also you will not have to deal with
multiple people for equities as a product.

Since the advisory only deals with equity as an asset class, his understanding of
the derivatives and nuances of the market will be better than someone who deals
with multiple asset classes.

The most important of all, the EAG gets inputs from the technical and derivatives
research group, whose sole objective is to identify trading opportunities with a
favourable risk-reward ratio.

The research products of the derivative and Technical desk will be available for
you as a client.

ONLINE TRADING

My Broker: Welcome to Motilal Oswal Securities Ltd. and Trade online through our
MyBroker platform. Be your own broker with complete research support from MOSL
which helps you to make right decision at right time. You can choose your trading a/c
which suits your trading habit’s & preference and trade anywhere, anytime. Buying
and selling is as easy as click of a button.

MyBroker Easy works very fast on low speed internet connection.

MyBroker Mobile Helps you to buy or sell through your mobile phone

MyBroker Desktop works best on high speed internet connection and suited
best for heavy traders

MyBroker Spectrum is suited best for investors and traders who want live
market watch and faster execution.

Product Offerings

Value Pac Margin account

Value Pac: Value Pac schemes offers you true “Value for Money”. It is the
upfront subscription scheme, which gives you hefty discounts in brokerage rates with
 defined time period to use it. With the wide range of Value Pacs, based on the
Volume of your Trade and the Validity period you can enjoy the benefits of placing
your trades at reduced charges.

Margin account: In case you don't want to commit on Value Pac (upfront
subscription) and still take benefit of reduced brokerage rate; you can opt for our
Margin Account where you would have to give defined upfront margin amount at the
time of opening account.

IPO Offerings

Apply for IPO’s online without filling up physical forms or writing out cheques

Check your IPO order status details

Modify/cancel your bids online

Transfer funds online to your IPO account

Access the latest information and news relating to IPO’s

Mutual Funds Offerings

Transfer funds online to your MF account

Get the latest news and information in the world of Mutual Funds

Avail of top class research on various Mutual Funds

For Whom

MyBroker EXE – Active trader

MyBroker Spectrum – Active Investors

MyBroker Easy trade – Retail Investors

INSURANCE
 Motilal Oswal Securities added Life Insurance during April 2008 to our Wealth
Management Portfolio thereby filling the gap in our basket of the products and thus
providing comprehensive financial planning to our clients covering not all wealth creation
solutions, but also wealth protection through proper risk management process.

MOSL through our insurance partners offers insurance coverage and wealth creation
opportunities to meet your different financial goals during the various stages of your life.
The plans offer you the control to manage your protection and investment in one account. It
is designed to remove your worries and making you secure in the knowledge that you and
your loved ones are protected against any untoward events.

On the basis of which life stage you are in and the corresponding insurance needs,
plans we offer, can be categorized into the following types:

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Offerings

Wealth Solutions

Retirement Solutions

Education Solutions

Securing Life

COMMODITIES

Ever since the dawn of civilization commodities trading have become an integral part
in the lives of mankind. The very reason for this lies in the fact that commodities represent
the fundamental elements of utility for human beings. Over the years commodities markets
have been experiencing tremendous progress, which is evident from the fact that the trade
in this segment is standing as the boon for the global economy today. The promising nature
of these markets has made them an attractive investment avenue for investors. Earlier
investors invested in those companies, which specialized in the production of commodities.
This accounted for the indirect investments in commodity assets.

Why Commodities?

The commodity based products offer a huge array of benefits that include offering
risk-return trade-offs to investors, providing information on market trends and assisting in
framing asset allocation strategies. Commodity investments are always considered as
defensive because during the times of inflation, which adversely affects the performance of
stocks and bonds, commodities provide a defense to investors, maintaining the
performance of their portfolios.

Commodity markets have a huge potential in the Indian context particularly because
of the agri-based economy. With the government's initiative for agricultural liberalization,
commodities' trading in India has gained increased momentum in activities. To increase the
efficiency of the markets the Forward Markets Commission (FMC), the governing body of
commodities trading in India has taken several initiatives for the establishment of national
level multi-commodity exchanges in India.

About MOCBPL Unique Experience

Motilal Oswal Commodities Broker Pvt. Ltd. (MOCBPL) is a fully owned subsidiary of
Motilal Oswal Financial Services Ltd. and has been providing commodity trading facilities
and related products and services on MCX and NCDEX. Besides access to the best of
research in the form of Daily Fundamentals & Technical Reports on highly traded
commodities, our clients also get access to our exclusive Customized Trading Advice on
both the trading platforms.

Solid Research: Client at MOCBPL gets access to the best of research in the form
of Daily Fundamental and Technical Research Reports on highly traded
commodities.

One Stop Shop: MOCBPL provides end-to-end advice for all the commodities to all
our prestigious individual investors. Privileged customers also get exclusive &
customized advice.

Dual Membership: MOCBPL has membership to MCX and NCDEX exchanges

which gives the clients to take advantage of the dual exchange trading facility
provided by us.

Personalized Service: We provide personalized service through dedicated

relationship managers for quick and efficient execution of transactions and for
regular follow ups.

MUTUAL FUNDS
 Investments can seem complicated and mystical. Since all the traditional investment
avenues like bank deposits, RBI Bonds, NSC, KVP etc are becoming unattractive with the
interest rate falling continuously, one needs to look for other investments alternatives.
Mutual funds offer the ideal platform to participate in the Equity & Debt market indirectly
through professional management.

Mutual funds are becoming the most popular investment vehicles offering various
kinds of schemes with different investment objectives. Investments through Mutual funds
are one of the safest, easiest and convenient ways of making successful investments. The
investments are in congruence to the laid down investment objectives securing the goals &
objectives of the unit holders.

At Motilal Oswal Securities Ltd, we understand the importance of financial goals of

our privileged clients and provide you comprehensive solutions to all your financial needs.
Through our tailor made portfolios, we serve your needs better and help you make informed
investment decisions. Our dedicated Mutual fund desk gives you Solid advice backed
services thus giving you the edge that you always wanted.

Services Offered

Need based advisory, fully backed with solid research.

Dedicated Mutual fund advisors to understand your needs and help you ild a tailor
made portfolio.

Monthly review of portfolios.

Monthly Fact-sheet covering our analysis of various funds.

Knowledge sharing through educational seminars and workshops

IPO

Book Building and Fixed Price Issue are the two types of Initial Public Offerings
(IPOs) through which a public company can raise money in the capital market.

In a book building public issue the bids are received at different price levels and
the demand for the issue is built up over a period of time. Depending upon
the bids received at different price levels the issue price is ascertained. In a fixed
price issue the issue price is pre ascertained by the issuer.

There are two types of IPOs

“Book Building” means a process undertaken by which a demand for the securities
proposed to be issued by a body corporate is elicit and built up and the price of the security
is assessed on the basis of the bids obtained for the quantum of securities offered for
subscription by the issuer. This method provides an opportunity to the market to discover
the price for securities.

In case of a fixed price issue the issue price is fixed.

ONLINE IPO

MOSL facilitates the IPO application for all of its clients through online platform. Using the
Online IPO service, an existing can apply for the IPO using the weblink
www.onlinetrade.motilaloswal.com.

BENEFITS

MOSL has the best of both the worlds for IPO. It has on of the distribution network
of outlets. Once the shares are allotted they can be sold at the same outlet.

At the same time MOSL has a very convenient online trading platform through which
you can invest in IPOs in three easy steps.

Why IPOs at MOSL?

Easy access to our Business locations with over 1289 Business locations spread
across over 548 cities.

Research and advice on new issues.

Regular updates on ongoing and forthcoming issues to investors.

DEPOSITORY
 “MODES”- Motilal Oswal Depository Services In the times of T+2 having a de-mat
account linked to your trading account becomes really convenient. The non-trading clients
can also avail of MODES.

Today MODES is available at all business locations of Motilal Oswal. In terms of

number of accounts MODES is the second biggest Depository Participant in CDSL with
over 150,000 accounts. The trust they have in Motilal Oswal is reflected by their cumulative
holding in MODES worth over Rs. 3400 crores.

Holder of a MODES account receives regular account reports and an efficient

service at all times. Clients having holdings over Rs. 10 lakhs receive special SMS service.
They get recommendations on their holdings based on Motilal Oswal Research rated the
"Most Independent Research - Local Brokerage" by Asia Money Brokers Poll 2006.

Benefits

As an investor you will enjoy many benefits if you buy and sell shares in the
depository mode. The following are some of the benefits you will enjoy:

No bad deliveries

No risk of loss, mutilation or theft of share certificates

No stamp duty for transfer of shares

Reduced paper work

Fast settlement cycles

Low interest rates on loans granted against pledge of dematerialized curities by

banks

Low margin on securities pledged with banks

Increase in liquidity of your securities because of faster transfer and istration of

securities in your account

Instant disbursement of non-cash benefits like bonus and rights into your account.

Regular account status updates available from MODES at any point of time.
For Whom

DP account is now a must for each and every participant in the stock market, whether he is
trader or and investor; whether he believes in fundamentals or in technical.

LOAN AGAINST SHARES

Loan Against Securities (LAS) is getting instant liquidity from your investment without
selling them. All you have to do is pledge your securities in favour of Motilal Oswal Financial
Services Limited (MOFSL). This enables you to enjoy all corporate benefits accrued on
your securities and still avail loan against them. No EMI or prepayment charges applicable.
Interest will be charged only on the actual amount and that too for the time it is utilized.

Process

Account Opening

We at MOFSL understand your needs and help you meet your liquidity
requirements.

As an Individual or Corporates, you can avail LAS in 3 simple steps:

Open a Trading and Demat account with Trading Member and depository
Participant.

Sign Master Loan Agreement with MOFSL.

Open Bank Account with a designated bank.

Borrowing limit based on your Financials

10 times of latest Income Tax Return.

One time of your net worth as certified by a CA.

Understanding your investing eligibility and funds available can get complicated, so
we at MOFSL will calculate your eligibility for you. This information can be accessed any
time through your separate web login.
For Whom

This product is suitable for clients, who want instant liquidity from their investment
without selling them and use this liquidity to buy more shares and take the inherent
benefits of leveraging, and keep the delivery of the stock for longer period of time with their
part margin

Benefits of LAS with MOFSL

Exhaustive list of approved securities.

Loan go up to 75% of securities amount.

Pay interest only on the amount outstanding and only for the time used.

Interest is calculated on the daily outstanding balance and debited to your account at
the end of every month.

Can also be availed against open ended mutual fund schemes.

Enjoy all corporate benefits like bonus, dividends etc accrued on your securities.

ASSET MANAGEMENT:

Portfolio Management Services (PMS) Our team of portfolio managers design portfolios to
suit every customer’s needs. Constantly scrutinizing the developments in market and
moving stocks, we aim for maximum capitalization.

We suggest the most appropriate product to customers, based on factors like their
investment spheres, return expectation and risk tolerance. Our experience, expertise and
research helps us give our customer’s investments the best upshots.

PRIVATE EQUITY

Motilal Oswal Private Equity Advisors Private Limited (“MOPEAPL”) is the private
equity arm of Motilal Oswal Financial Services Limited (“MOFSL”). Started in 2006, it has
quickly emerged as one of the most active private equity funds in the country with the
primary investment objective of achieving long-term capital appreciation by providing
financial, strategic and operational assistance to emerging companies in the Mid Market
(“MMEs”) space and Real Estate sector.

Currently manages and advices two funds:

India Business Excellence Fund India Business Excellence Fund [“IBEF”] is a sector
agnostic fund with a corpus of INR 5.5 bln (US$125 mln) from both Indian and Overseas
investors. IBEF makes investments in Indian MMEs looking for growth capital and has
made eight investments since its inception in January 2007 in companies across various
industries. For more information on IBEF, please click here.

India Realty Excellence Fund India Realty Excellence Fund [“IREF”] is a pure
domestic real estate fund launched in July 2008 with a target corpus of INR 165 crores.
IREF will provide capital to young, fast growing real estate developers in India and will be
capable of investments right from land acquisition stage.

Key features of the fund are:

The fund can invest at the early stage of land acquisition giving it a competitive edge

Flexibility of investments in terms of size, timing, method and partnering with mid
sized developers will provide easier entry and exit strategies

Diversified portfolio of assets spanning across geography, asset class and type
providing lower risk and higher returns

Focused on residential and commercial projects, opportunistic investments in retail

and other assets with a moderate timeframe for completion

Focus on top 15 urban agglomerations due to high growth in urbanization

Fund large-mid sized regional developers looking for equity partnership and also
large size developers having fund requirements for land acquisitions

Independent assessment of investments – No conflict of interest

High level of corporate governance and an institutionalized investment process

 Experienced fund managers having pioneer experience of launching a real estate
fund supported by professionals like lawyers, domain experts, etc provide a cushion
against risk mitigation

Experience in investing public money with a strong management team

In-house real estate research team

The Fund is currently in the process of achieving its second closing and plans to
make its first investment by the end of CY 2009

INVESTMENT BANKING

Motilal Oswal Investment Advisors Private Limited (MOIAPL) Founded in June 2006,
MOIAPL offers comprehensive Investment Banking solutions and transaction expertise
covering private placement of equity, debt and convertible instruments covering
international & domestic capital markets, mergers & acquisitions advisory and restructuring
advisory & implementations.

The team comprises of multi-disciplinary professionals with extensive collective

banking and corporate finance advisory experience. An in-depth understanding of different
sectors within the Investment Banking team underpinned by the two decade old research
strength of the group company, Motilal Oswal Securities Limited enables us to provide
customized financial solutions to our clients across industries.

We display a focused transaction-closure orientation which is facilitated by our cross-

product knowledge and the well entrenched relationships that we nurture at the highest
levels within the investor community, market intermediaries and the corporate sector. We
work in partnership with the management of our clients and commit our resources end-to-
end throughout the transaction, ensuring timely execution with minimal disruption

To pursue our mission, the team inculcates the following values with utmost
sincerity:

Integrity: We honor our commitments and work on transactions keeping in mind the long
term interests of the clients.

Client Orientation: We start with gaining a thorough understanding of the client’s needs
and then offer solutions keeping in mind the priorities and suitability to them.
Knowledge based solution offering: Our quest for offering the optimum solutions is
supported by the knowledge and research on the underlying business and products,
resulting in high quality financial and strategic advice.

Quality: Our endeavor to follow the best global service standards and processes resulting
in outstanding execution support for the transactions.

Passion: We are passionate about our work. This results in innovative solutions and
greatly enhances the probability of transaction closures.

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Offerings

Domestic Capital Markets

We are a Category-I Merchant Banker registered with the Securities and Exchange
Board of India (SEBI) authorizing the company to manage, advice and underwrite domestic
capital market issues. We have expertise in Initial Public Offerings, Qualified Institution
Placements, Follow-On Public Offerings, Rights Issues, Open Offers and Buy Backs.

International Capital Markets

We work with Indian Corporates to tap overseas investors through listing an FCCB
or GDR issue on a reputed international stock exchange. We have placed FCCBs with
overseas investors leveraging our strong relationships with overseas process agents,
international lawyers and listing agents

Private Equity Syndication

We leverage our extensive network of relationships with Private Equity Funds to

raise growth capital for our clients to fund their expansion strategies.

Structured Finance Syndication

We have built a strong reputation for advising and executing complex Structured
Finance transactions. Implementation of a structured finance solution allows corporate
clients to postpone or limit equity raising thereby leading to lower dilution.

Mergers and Acquisitions Advisory

We focus on providing solutions and support in implementing strategic decisions of

our clients on target evaluation, acquisition, strategic alliances, divestitures, restructuring,
de-mergers, privatization and mitigation of potential takeover threats. We are active on both
buy-side and sell-side mandates leveraging our industry knowledge, deep relationships and
extensive experience in facilitating and financing acquisitions.

Financial Restructuring Advisory

We specialize in helping companies come out of financial distress. We work with our
clients in all aspects of the transaction including structuring, valuation, negotiations for most
optimal settlement and fund raising to facilitate implementation of the proposed solution.

Real Estate Advisory

We assist firms in raising funds for real estate construction / development projects at
the ‘holding entity’ level as well at the ‘project SPV’ level. We work with our clients through
all stages of the transaction from developing a nuanced understanding the client’s cash flow
requirements to capital structuring of the transaction, evaluating of various funding raising
options and execution of the transaction up to assisting in documentation, regulatory
clearances and eventual funding.

WEALTH MANAGEMENT

At Motilal Oswal it has been our constant endeavour to go beyond traditional

services and provide customized value. That's the reason we have devised a holistic
approach to Wealth Management.

We believe the Wealth Management needs are varied. For some they may lie in
personal Wealth Management, while for others it may extend to business requirements. To
cater to such diverse needs, we have launched a Wealth Management service called
Purple.

At Purple, your dedicated Purple Wealth Partner will provide customised advice to
take care of both your personal and business wealth management needs.
Motilal Oswal Securities Limited’s Strengths

Analytical advisory

Professional knowledge

Brand affiliation

Well Trained.

Good Investor Base.

Highly Determined.

Well Established Network.

Exclusive Concept.

Diversified Operations Team.

 Large and diverse distribution network

Strong research and sales teams

Brand recognition

Experienced top management

Strong financial results

Motilal Oswal Securities Limited’s Superior Technology and Robust Risk

Management Tools

We recognize the need to have a sophisticated technology network in place to meet

our customer needs as well as to

Effective use of Technology

Our IT infrastructure includes a world class data centre, offline and online trading
platforms with 99.8% planned uptime and a cost effective combination of VSAT, leased
lines, VPN and other modes to provide superior connectivity to our wide spread business
network.

Over 8500 terminals are managed through this network across various equity &
commodity

Dedicated data center at Malad, Mumbai with 28,500 sq ft area

robust risk management system

Monitor and control risk exposure through a variety of separate but complementary
financial, credit, operational, compliance and legal reporting systems

Real-Time Risk Management - Gives users information on clients’ open positions

Risk management department analyses this data in conjunction with our risk
management policies and takes appropriate action where necessary to minimise risk.

Motilal Oswal Securities Limited Core Purpose And Values

Core Purpose:

To be a well respected and preferred global financial services organization enabling

wealth creation for all our customers.

Values:

Integrity A company honouring commitment with highest ethical

and business practices.

Teamwork Attaining goals collectively and collaboratively.

Meritocracy Performance gets differentiated, recognized and

rewarded in an apolitical

Passion & Attitude High energy and self motivated with a “Do It” attitude and
entrepreneurial spirit.

Excellence in Execution Time bound results within the framework of the company
’s value system.

Motilal Oswal Securities Limited’s Pillars: Management Team

Motilal Oswal Trustee Chairman & Managing Director

Oswal is an associate director and is the Chairman of the Board of Motilal Oswal
Trustee Company Limited. He is also Managing Director of Motilal Oswal Financial Services
Ltd. He has varied experience of over 2 decades in the financial service sector. Mr. Oswal
has served on the governing board of the Bombay Stock Exchange (BSE) as a Director. He
has also been member of the National Stock Exchange (NSE) committee for F&O and a
member of the Managing Committee of Indian Merchants' Chamber (IMC).
 He is a board member and a Director of Jain International Trade Organisation
(JITO). He is also a Director on the Board of various Companies.

Mr. Oswal has received the "Rashtriya Samman Patra" awarded by the Government
of India for being amongst the highest Income Tax payers in the country for a period of 5
years from FY95–FY99.

The Indian Council of Management Executives (ICME) has awarded the ‘Knight of
the Millennium’ to Mr. Oswal for the Capital Market.

Sunil Goyal Independent Director

Mr.Goyal is an Independent Director on the Board of Motilal Oswal Trustee

Company Limited. He is the Managing Director of Ladderup Finance Limited and
Ladderup Corporate Advisory Private Limited. He has rich and varied experience of
more than 18 years in the field of Financial and Management .

Bijay Krishna Datta Director – Trustee

Mr. Datta is an independent director on the Board of Motilal Oswal Trustee

Company Limited. He was the Executive Director of UCO Bank. He headed the
maiden IPO of UCO Bank in 2004 and created a new Land Mark for Banking
Industry in India with regard to number of times over subscription by the retail
investors.

Nitin Potdar Director – Trustee

Mr. Potdar is an independent director on the Board of Motilal Oswal Trustee

Company Limited. He is associated as a Partner with J. Sagar Associates, a premier
law firm. He has rich and varied experience of over 19 years in corporate laws
particularly in the field of Merger and Amalgamation and Foreign Direct Investment in
India.

BOARD OF DIRECTORS

Mr. Motilal Oswal

Chairman and Managing Director,

 Chief Executive Officer and Chief Financial Officer

Mr. Raamdeo Agrawal

Joint Managing Director

Mr. Navin Agarwal

Director

Mr. Ramesh Agarwal

Independent Director

Mr. Balkumar Agarwal

Independent Director

Mr. Madhav Bhatkuly

Independent Director

Company Secretary and Compliance Officer

Mr. Samrat Sanyal

Bankers

Citibank N.A.

HDFC Bank

Standard Chartered Bank

Auditors

M/s Haribhakti & Co., Chartered Accountants

Joint Managing Director & Co-founder Raamdeo Agrawal

Director Navin Agarwal

Institutional Equities Navin Agarwal

Investment Banking Ashutosh Maheshvari

Private Equity Vishal Tulsyan

Asset Management Nitin Rakesh

Broking & Distribution Vijay Goel

Principal Strategies Srikanth Iyengar

Wealth Management Harsh Joshi

COO Ajay Menon

Research Rajat Rajgarhia

Equity Advisory Manish Shah

Marketing Ramnik Chhabra

Corporate Planning, Treasury

Business Solutions & IR Sameer Kamath

Business Process Excellence &

Information Technology Anuragi Raman

Human Resources & OD Sudhir Dhar

Motilal Oswal Securities Limited’s Vision & Mission

VISION:

To enhance our customers the financial Security by creating wealth.

To be one of the most trusted and globally reputed financial distribution companies.

To Become No-1 In India Through Fair Practices & Keep Maintain This Position
Forever.
 Be a world class financial service provider, value based wealth creation to my clients
& become a well reputed organization

MISSION:

To provide the customers the financial freedom by enhancing Wealth Management.

Truly Value Based Wealth Creation Of Every Customer With Disciplined, Integrated
& Customize Services Way.

Expand business both in the value, volume wise make it no 1 in its segment

Motilal Oswal Securities Limited’s growth:

BROKING AND DISTRIBUTION

- Distribution expands to 1397 business locations across 584 cities

- More than 6,00,000 registered customers

- Depository assets at over Rs. 113 billion

- India’s largest dealing room (over 26,000 sq feet)

- Over 100 investment education seminars conducted

ASSET MANAGEMENT

- Portfolio Management Services AUM of Rs. 9.8 billion

- Approval received from SEBI for starting Mutual Fund business

- First scheme offer document filed with SEBI for approval

WEALTH MANAGEMENT

- AUM of Rs. 8 billion

- Presence in Mumbai, Kolkata, Pune and Ahmedabad

- Unique Wealth Management offering (Purple) based on financial profiling

and client need analysis

INVESTMENT BANKING

- 66 deals in 4 years across the product spectrum and sectors

- Cumulative revenues since inception : over Rs. 2 billion

- Facilitated periodic thematic conclaves between corporates and investors

PRIVATE EQUITY

- India Business Excellence Fund (US$ 125 million) - over 61% invested
across 10 transactions

- India Realty Excellence Fund closed at INR 1.64 billion

INSTITUTIONAL EQUITIES

- Over 300 institutional clients, including 200 FIIs.

- Research covering 236 companies in 27 sectors and 23 commodities

- Research received 10 awards in the ET- Starmine Analyst Awards 2009

including Best Broker

FUND-BASED BUSINESSES

- Margin Funding book of Rs.1.6 billion

- Principal Strategies Group in place to optimise treasury yields

Motilal Oswal Securities Limited Depatments

TRADING DEPARTMENT

Motilal Oswal is one of the broker who is acting as wholesalers and as a broker, it is
the duty of it to provide service of collecting funds and securities from the investors and
send it to clearing house and vice versa. According to SEBI investor has to open trading
account for trading in shares. Client can open an account in any depository.

Trading department is divided into three parts:

Pre-trading (A/c opening, Deposits, ect.)

Trading (Dealing room, Sauda punching, conformation)

Post-trading (Payout process, Bills, Pay-in-process, Contract

note)

MARKETING DEPARTMENT

The main aim of marketing activities at Motilal oswal is that the customer should get
enough guidance to join the company and how he can get the best service than any other
stockbroker.

This year MOFSL introduced a new brand philosophy. The relentless focus on
research and insight, which is the DNA of the company, has manifested itself in the brand
idea - ‘Knowledge First’. This simple philosophy of 'Knowledge First' has been brought alive
through a multimedia campaign in TV, print, outdoor and the web.

HUMAN RESOURCE DEPARTMENT

MOFSL has grown at a scorching pace, not only in terms of business but also in
terms of its most valuable asset -people. They have an ever-growing employee strength of
2315 associates that operates out of a rapidly expanding Company network.
 HR at Motilal Oswal, on the one hand strives to make every employee of the
organisation its brand ambassador and on the other hand make the Motilal Oswal brand
stand for the best people practices.

The 3 pillars of HR strategy are:

(1) A clear and relentless (persistent) focus on leadership development

(2) Stringent (severe) focus on the identification and development of 'High

Potentials' at all levels

(3) Investment in technology to deliver state-of-the-art HR processes across

the organisation in a time and cost efficient manner

Motilal Oswal Securities Limited Research Desk

Motilal Oswal Securities Limited Research desk has a dedicated team of research
analysts and experts that have an in-depth knowledge of the market place. They offer value
perspectives, focus on opportunities for investment and growth and endeavor to reduce risk
potential. It's premium advisory services are based on technical and fundamental views and
strategies.

Research is the solid foundation on which Motilal Oswal Securities advice is based.
Almost 10% of revenue is invested on equity research and we hire and train the best
resources to become advisors. At present we have a expert team of Research Analysts
researching over 27 sectors and 24 commodities. From a fundamental, technical and
derivatives research perspective; Motilal Oswal's research reports have received wide
coverage in the media (over a 1000 mentions last year). Our consistent efforts towards
quality equity research has reflected in an increase in the ratings and rankings across
various categories in the AsiaMoney Brokers Poll over the years.

Our unique Wealth Creation Study, authored by Mr. Raamdeo Agrawal, Jt. Managing
Director, is now in its 15th year. Investors keenly await this annual study for the wealth of
information it has on the companies that created wealth during the preceding five years.

Motilal Oswal Securities Limited’s Achievement:

Research Methodology

Research methodology mean what's method apply to do any type of research and.
how can you collect the data from the field'. Before conducting any type of research and
analysis and inference based on it, the first and the foremost thing is to collected the date
and after the proceeding in a systematic manner to finally reach at result.

Research:-
Research is a process of collecting, analyzing, interpreting and summarizing
in a significant manner for the purpose of framing out necessary conclusion and
finding of data perceived and formulated for deriving out the meaningful information.
To carry our research necessary telephonic calls needed to be done, suitable
appointments were to be fixed and therefore to be market survey is to be followed.
Process:-
Collection of data: this is an important aspect in formulating the objective of
research process where the data is collected via two process-
Primary sources
Secondary sources

Primary sources- the data is collected primarily by interviewing and personal

observation and is original in nature & accurate to the considerable extent.

“Primary data may be described as those data that have been observed and
recorded by the researchers for the first time to their knowledge.”

There are several methods of collecting primary data. Important ones are:
-Observation method
-Interview method
-Questionnaires
-Schedules and
-Other methods etc.

Secondary sources- where the data is obtained from some published &
printed sources as newspaper, magazine, website and so on.
 “Secondary data are statistics not gathered for the immediate study at hand
but for some other purposes.”
The secondary data can be collected by internal and external secondary data
like data gathered from the files and documents of the company and business
periodicals published for monthly, quarterly or annually.
-Publications of central state and local govt.
-Publication of foreign.
-Journal
-Books, magazines and newspaper
-Reports and publication of business house
-Reports and publication of scholars and universities.
-Public records

Analyzing of collected data: the data collected through market survey &
published sources are then processed to obtained necessary inferences & finding for
the purpose of achieving the objective as well as to derive necessary conclusion. A
considerable skill & knowledge is involved in analyzing the data for the purpose of
interpreting thereof.

Interpreting of data: it is the significant step where the data collected and
analyzed is interpreted in the forms of graphs and figures is depicted in the report
called project report.

Summarizing the data: thereby necessary summary is prepared which is

essential in the summer training being done under an organization.

3.1 Title of the Study

“Investment and Securities Analysis”.

3.2 Duration of the Project

I have done successfully 15 days training in Motilal oswal securities limited.

This project study period was very beneficial to learn lot of knowledge.
3.3 Objective of Study

The stock exchange of the country is the important part of the capital market.
It provides the investors a platform to invest in different securities. The well regulated
stock exchange is in the interest of both the company’s as well as the investors.
In India the stock exchange provide a good leverage to the capital market, but
it is not very easy to get profit out of this market, for this knowledge is must about the
market. the knowledge can be obtained by knowing the security market . Knowledge
of security market is very important to a management student.
As I have done my project training in Motilal Oswal Securities Limited ,the
following are the objective, which I kept in my mind while doing summer training:-
To know practical concept about the security market
To study the general operation of the Motilal Oswal Securities Limited.
Analyzing the market survey and thereby finding out the investment pattern of
the consumer.
To impart knowledge about the general working of the stock exchange
Fundamental analysis of securities
To gain in –depth knowledge about up gradation made due to computer in
stock exchange.

3.4 Type of Research

EXPLORATORY:

Exploratory research is a type of research conducted because a problem has

not been clearly defined. Exploratory research helps determine the best research
design, data collection method and selection of subjects Exploratory research often
relies on secondary research such as reviewing available literature and/or data, or
qualitative approaches such as informal discussions with consumers, employees,
management or competitors, and more formal approaches through in-depth
interviews, focus groups, projective methods, case studies or pilot studies.
 DESCRIPTIVE:

Descriptive research, also known as statistical research, describes data and

characteristics about the population or phenomenon being studied. Descriptive
research answers the questions who, what, where, when and how... The description
is used for frequencies, averages and other statistical calculations.

3.5 Sample Size and method of selecting sample

100, Stratified Sampling

SAMPLING PLAN:

Sample unit :- The sampling units are various areas of

sumerpur which have been approached to collect data from different
people.

Sampling method:- Sampling method used in this research is simple

random sampling which is also known as probability sampling. Under this
sampling design every item of universe has an equal chance of inclusion in
sample. It is say to a lottery method.

Sample size:- The size of the sample was restricted to 100, as to just
get a quick analysis

CONTACT METHOD

Personal interview is used as a method of contacting people.

It is a market research technique for gathering information through

face-to-face Contact with individuals. Personal interviews take place in a
variety of settings-in Homes, at shopping malls, in a business office. This type
of research is relatively costly, because it requires a staff of
interviewers, but it provides the best opportunity to obtain information
through probing for clearer explanations. It is the best technique to use early
on in the research process when the researcher is not yet sure which
 questions need to be asked, because new and better questions can
come out of the dialogue

DATA COLLECTION METHOD

Research Instrument used in this research was Questionnaire.

A questionnaire is a formalized set of questions for eliciting information.

It is one of the most common instruments used for primary data collection.

The questionnaire can be administered in various ways. It can be

administered by means of a personal interviewer as well as by the telephone,
Mail. Here, the questionnaire was administered by a personal interview.

TOOLS OF ANALYSIS

For the proper analysis of data, Quantitative Technique such

as percentage method was used. In addition, Microsoft excel was also used
for preparing charts for deducing inferences.

3.6 Scope of Study

After conducting the research at Motilal Oswal Securities Limited at sumerpur

on equity research , many stages are undertaken as guidance towards appearing at
conclusion like interaction with staff ,questionnaire survey and percentage analysis.

As the questionnaire are targeted to get filled by general public who keeps
interest in investment and have an idea about equity .so I got the opportunity to know
certain facts about this securities market . Whatever conclusions I have drawn from
this research part are mentioned below:

Presently in India, securities market is not so much established and popular,

there is only a small portion of people who are being an active part of this market as
an investor. Most of the people invest only 20% to 40% of their saving in this market
and their basic criteria to invest in this market is achieving higher returns. Most of the
investors want to enjoy higher returns by investing in this market.

Most of the investors, who are investing in this securities market, are choosing
the securities on the basic of goodwill of the company although they prefer and
believe that technical analysis produces good and accurate result but still as these
technical analysis is not so easy to understand they choose their securities on the
basis of the reputation of the company. If we look upon those people who are using
technical analysis then we will find that most of the people who choose the securities
by doing technical analysis are using moving average as the most easy and suitable
tool.

There are also some people who are investing in securities market by using
market calls and tips as the base to choose the securities, but they are not so much
about the result of these market calls and tips, they didn’t believe that these calls and
tips are so much fruitful but as they are not very much aware regarding the technical
tools, they have to use market calls and tips.

It is the believe of investor that technical analysis is not very easy to

understand, but as the securities market is growing day by day so investors are
trying to understand these technical tools we can say now people are being
interested to learn about technical analysis. It is a good indication that people are
now interested and excited to know about technical analysis of securities and they
want to choose the securities on the basis of technical analysis so all the companies
related to securities market like Bonanza should encourage and motivate their know
investors and clients to use of most easy technical tools to them.

3.7 Limitation of Study

The various limitations which are found by me in market are:-

Lack of awareness of stock market: - Since the area is not known before it
takes lot of time in convincing people to start investing in share primarily in IPO’s.

Mostly people comfortable with traditional brokers: - As people are doing

trading from their respective broker, they are quite comfortable to trade via phone.

Some respondents are unwilling to talk: - Some respondents either do not

have time or willing does not respond, as they are quite annoyed with the phone call.

Lake of techno savvy people and poor internet penetration:-Since most of the
people are quite experienced and also they are not techno savvy. Also internet
penetration is poor in India.
 Inaccurate leads: - Sometimes leads are provided which had error in it which
varies from only 5 digit phone number to wrong phone number.

Misleading concepts: - Some people think that shares are too risky and just
another name of gamble but they don’t know it’s not at all that risky for long
investors.

Facts and Findings

FINDINGS
Fundamental Analysis helps us understand in which stock we should invest In
equity market there is continuous growth in number of contracts but fewer
understand on what basis they are investing.
The findings for the above research are as follows:-

Mostly of investors which lies in 1 lac category like to invest more, and
less than 10000 or 10000 is not take initiative to invest in security market.
40 to 60 age of investor are more interested in investment, Rather than
investors who are in 20 age group. In the above survey only 3% of investors
are interested in 20 age group.
40% of investors invest 20% to 40% of their total income. Among 100
people and only 20% of people like to invest above 60% of their total income.
There are mostly investor invest in security market because of higher
return. In above diagram 47% investors only invest in security market for
higher return.
mostly investor like to invest in equity rather than other market. it is
about 40% and in case commodity market it is only 5% , in bank fd’s which is
prefer in second option is 25% , in bonds it is 10% and in mutual fund it is
about 20%.
Most of the investors only invest in stock because of goodwill of the
company. only 8% of people invest in stock because of popularity of security ,
it means that most of the people don’t have the knowledge of security market
On the basis of analysis, we can conclude that mostly investor prefers
technical analysis rather than market calls. We can analyze that 50% or
 above investor believe on technical analysis; it is about 62%.where as 8% of
investors don’t believe in technical analysis.
About 65% of investor does not easily understand the technical
analysis of stock. Means they believe on technical analysis but they don’t
have so much of knowledge of it.
Those investors who believe on market calls / tips, mostly based on
stock broker. It is about 47% and 8% on mobile and 45% on TV channels.
By the analysis we can interpret that about 65% of investors believe
that only 30% or less market calls are correct. And 15% investors believe that
market calls are wrong about 60% and above.
There are majority of investors believe that security market is grows.
and few believe that it does not grow because of recession and many more
reasons.

Analysis and Interpretation

Knowing the awareness and perception of the customers is very important in

any industry. This provides insight into the customer behaviour and his expectation
from the industry players. A proper understanding of the awareness and perception
would definitely benefit the players. This survey attempt to know the investor better.
It examines some interesting choices of the investor including the reasons behind
investing in stock market and the risk tolerance levels of the investors. The investor
knowledge about the stock market and company. This sumerpur city survey was
conducted to know the investor awareness and perception about company. It is
hoped that this survey in sumerpur city would go a long way in benefiting for Motilal
Oswal securities Limited.

 Do you know about MOSL?

(a) 32% of the respondent is Have heard about them

(b) 56% of the respondent is Aware

(c) 12% of the respondent is Unaware

 Have heard
about them ,
32, 32%
Aware
Completely Unaware
Aware, 56, 56%
Have heard about them

Completely
Unaware, 12,
12%

 where would you like to Invest?

(a) 36% of the respondent is share market

(b) 20% of the respondent is fixed deposits

(c) 12% of the respondent is property

(d) 14% of the respondent is jewellery

(e) 18% of the respondent is insurance

40
36
35

30
Fixed Deposits
25
Share Market
20
20 18 Property
14 Jewellery
15 12
Insurance
10

0
1
 which company of the share market are you aware of?

(a) 35% of the respondent is Motilal oswal securities limited

(b) 20% of the respondent is indiabulls

(c) 24% of the respondent is anand rathi

(d) 11% of the respondent is angel

(e) 10% of the respondent is other

 In which brokerage house you have your Demat account?

(a) 32% of the respondent is Motilal oswal securities limited

(b) 18% of the respondent is indiabulls

(c) 22% of the respondent is anand rathi

(d) 16% of the respondent is angel

(e) 12% of the respondent is other

 How often do you trade ?

(a) 25% of the respondent is Daily

(b) 30% of the respondent is weekly

(c) 19% of the respondent is monthly

(d) 26% of the respondent is sometime

Weekly, 30
30
Daily , 25 Sometime , 26
25

20 Monthly, 19

15

10

0
Daily Weekly Monthly Sometime

Series1

 Which of these products apart from equity your company is providing?

 (a) 18% of the respondent is Mutual fund

(b) 15% of the respondent is Investment

(c) 10% of the respondent is Insurance

(d) 22% of the respondent is Trading

(e) 35% of the respondent is All of the

40 35
35
30
25 22
18
20 15
15 10
10
5
0
Mutual Fund Investment Insurance Trading All of the
advisory above
Financial Products

Series1

 Does your company provide online trading?

(a) 11% of the respondent is No

(b) 89% of the respondent is Yes

No, 6, 11%

Yes
No

Yes , 50, 89%

 Investor’s income level?

(A) 2% of respondent invest in security market that lies in 10000

(b) 15% of the respondent invests in security market that lies in 10000-50000

(c) 30% of the respondent invests in security market that lies in 50000-

100000

(d) 53% of the respondent invests in security market that lies in above

100000

60%

50%

40%
below 10000

30% 10000-50000
50000-100000

20% above 100000

10%

0%
Category 1

Interpretations:

Mostly of investors which lies in 1 lac category like to invest more, and less
than 10000 or 10000 is not take initiative to invest in security market.

 age of investors :-

(a) 3% of the respondent is below 20

(b) 42% of the respondent is 20-40

 (c) 48%of the respondent is 40-60

(D) 7% age of investors above 60

above60, 7% below 20, 3%

20-40, 42%

40-60, 48%

Interpretation:

40 to 60 age of investor are more interested in investment, Rather than

investors who are in 20 age group. In the above survey only 3% of investors
are interested in 20 age group

 How much portion of your saving do you invest / would invests in share
market?

(a) 25% of the respondents go with up to 20%

(b) 40% of the respondents go with up to 20% to 40%

(c) 15% of the respondents go with up to 40% to 60%

(d) 20% of the respondents go with above 60%

 45%

40%

35%

30%

25%

20% Series 1

15%

10%

5%

0%
below 20% 20%-40% 40%-60% above60%

Interpretations:-

40% of investors invest 20% to 40% of their total income. Among 100 people
and only 20% of people like to invest above 60% of their total income.

 you invest in stock market because

(a) 47% of the respondents go with higher return

(b) 10% of the respondents go with faster return

(c) 25% of the respondents go with easy liquidity

(d) 18% of the respondents go with depends on market

 18%

higher return
47% faster return
easy liqidity

25% depend on market

10%

Interpretation:

Above diagram explain that mostly investor invest in security market because
of higher return. In above diagram 47% investors only invest in security
market for higher return.

 Taking the factors like security, rate of return and time in consideration
which among the Following you rate as per the best option?

(a) 25% of the respondents go with Bank FD’s

(b) 5% of the respondents go with small savings in commodity market

(c) 10% of the respondent goes with Bonds

(d) 40% of the respondent goes with equity/ derivative

(e) 20% of the respondent goes with Mutual funds

 20%
25%

bank FD's
commdity market
Bonds
5% Equity/ Derivative
Mutual funds
10%
40%

Interpretation:

We can analyze by this diagram that mostly investor like to invest in equity
rather than other market. it is about 40% and in case commodity market it is
only 5% , in bank FD’s which is prefer in second option is 25% , in bonds it is
10% and in mutual fund it is about 20%..

 What are the bases upon which people decide to invest in stock market?

(a) 32% of the respondent goes with technical analysis / fundamental analysis

(b) 13% of the respondent goes with Market call / tips

(c) 8% of the respondent goes with popularity of security

(d) 47% of the respondent goes with goodwill of the company

 50%
45%
40%
35%
30%
25% Series 1
20%
15%
10%
5%
0%
technical analysis Market call / tips popularity of goodwill of the
/ fundamental security company
analysis

Interpretation:

Most of the investors only invest in stock because of goodwill of the company.
Only 8% of people invest in stock because of popularity of security , it means
that most of the people don’t have the knowledge of security market

 Which one you prefer most?

(a) 60% of the respondent goes with technical analysis

(b) 40% of the respondent goes with market tips / calls

70%

60%

50%

40%
technical analysis
30% market tips / calls

20%

10%

0%
Category 1
 Interpretation:

On the basis of above diagram, we can conclude that mostly investor prefers
technical analysis rather than market calls.

 How much you believe on technical analysis of stock or how much right
result can be acquired by doing the technical analysis of any scrip?

(a) 13% of the respondent goes with up to 40%

(b) 17% of the respondent goes with 40-50%

(c) 62% of the respondent goes with more than 50%

(d) 8% of the respondent go with dose not believe at all

up to 40% 40-50% more than 50% not believe at all

8%
13%

17%

62%

Interpretation:

We can analyze that 50% or above investor believe on technical analysis; it is

about 62%.where as 8% of investors don’t believe in technical analysis.

 Is the technical analysis easy to understand even by a simple investor?

(a) 35 respondents go with yes

(b) 65 respondents go with no

 yes
no

Interpretation:

About 65% of investor does not easily understand the technical analysis of
stock. Means they believe on technical analysis but they don’t have so much
of knowledge of it.

 If your base to choose the scrip is market calls / market tips, and than
what are the sources you trust upon most?

(a) 8% of the respondent go with market tips by security based company on

mobile.

(b) 45% of the respondent goes with T.V channel like CNBC

(c) 47% of the respondent goes with stock brokers

50%
45%
40%
35%
30%
25%
20%
Series 1
15%
10%
5%
0%
market tips by T.V channel like stock brokers
security based CNBC
company on
mobile.
 Interpretation:

Those investors who believe on market calls / tips, mostly based on stock
broker. It is about 47% and 8% on mobile and 45% on TV channels.

 Up to what percent market tips are correct according to you?

(a) 65% of the respondent goes with 30% or less

(b) 10% of the respondent goes with 30%-50%

(c) 10% of the respondent goes with 50%-60%

(d) 15% of the respondent goes with more than 60%

70%

60%

50%

40%

Series 1
30%

20%

10%

0%
30% or less 30%-50% 50%-60% more than 60%

Interpretation:

In the above analysis we can interpret that about 65% of investors believe that
only 30% or less market calls are correct. And 15% investors believe that
market calls are wrong about 60% and above.

 Do you think will securities market grows?

(a) 80% of respondent go with Yes

(b) 20% of respondent go with no

yes
no

Interpretation:

Above interpretation explain that 80% of investors believe that security market
is grows and 20% believe that it does not grow because of recession and
many more reasons.
SWOT

Strengths

 Large and diverse distribution network

Solid research and solid advice

 Strong research and sales teams

 Brand recognition and Strong financial results

 Experienced top management

Weaknesses

Charges are high compare to other companies in industry

Opportunities

 Growing Financial Services industry's share of wallet for disposable income

 Huge market opportunity for wealth management service providers as

Indian wealth management business is transforming from mere wealth
safeguarding to growing wealth.

 Regulatory reforms would aid greater participation by all class of investors

 Leveraging technology to enable best practices and processes

 Increased appetite (need) of Indian corporate for growth capital

Threats

 Execution risk and Unfavorable economic conditions

 Slowdown in global liquidity flows

 Increased intensity of competition from local and global players

Conclusion

This securities market is about to grow in future very much with the growth of equity
research. There is very high competition in this market , there are many companies which
are providing different type of services to their clients and, this market is centre of attraction
to new entrepreneur because it is already successful market and it is for sure that it will
grow further, and there are many opportunities lying ahead in the way.

Motilal Oswal Securities Limited is an active and well known participant of this
securities market, this is achieving great success by working very hard with dedication.
There is very good staff in this organization so it may facilitate its clients in many ways,
although there is competition but still it is doing its own work and providing services to their
clients up to the best extent.

Solid research and analysis is very important service of Motilal Oswal Securities
Limited that it is providing to its client .It provides the suggestion that which security is good
for the purpose of investment.

For this project purpose, i have been gone through with a research that has been
conducted in sumerpur with a sample size of 160 investors and on the basis of this
research; I can conclude that most of the people believe that technical analysis can provide
more suitable and desirable results to them .People are interested to know about this
technical analysis part, for this we just need to aware and encourage them.
There should be more awareness made about the portfolio management services by giving
more advertisement.

The MOSL should go for tie-ups with the corporate to increase business.

Motilal Oswal Securities Limited should organize some events to build its Brand
Image in the minds of the people towards MOSL.

As per customer’s point of view, they feel that Motilal Oswal Securities Limited
should open more number of branches for the convenience of people.
Recommendation and Suggestions

As said earlier investment in equity market is growing fast, but still there are certain
things that need to be considered while & after investing. Thus this section deals with a
certain recommendations which would help in better development in investment and
securities.

Information about “investment and securities analysis” must be given to all the
investors & training should be conducted.

A monthly analysis of the company’s market movement should be sent to the clients.

Reduction in the cost of the brokerage that would help in increasing the investment
as well as small investors would be able to invest more freely.

A seminar should be arranged for the investors for giving them information about
various factors to be considered before & after investing.

Company (MOSL) should try to improve its services delivered to the customers. Bad
service is one serious hinder in its growth. It should try to speed up the response
given to the customers.

MOSL is facing stiff competition from different companies like Bajaj Allianz, ICICI
Prudential etc. In keeping track with them MOSL have to bring out products &
services with attractive schemes.

Highly Focus on Financial Planning Segment.

Try to maintain efficient and updated employees in most actionable department.

Those are very aware with practical problem from franchise end.

Maintain Micro Level Highly Accurate Research Work by R-Department.

QUESTIONNAIRE
Questionnaire based on awareness of company and consumer behaviour while
taking decisions related to his investment in Equities and Derivative market

Name:-………………….....

Age:-……………………….

Mobile no:-…………………

Landline no:-……………….

Address:-……………….......

Occupation:-…………….....

Please select the appropriate option:

 Investor’s income level?

(A) 10000 (b) 10000-50000 (c) 50000-100000

(d) above 100000

 age of investors :-

(a) 20 (b) 20-40 (c) 40-60 (d) 60 above

 How much portion of yours saving do you invest/would invest in share

market?

(a) 20% (b) 20%-40% (c) 40%-60%

(d) Above 60%

 you invest in stock market because :-

(a) high return ( b) faster return ( c ) easily liquidity

(d) depends on market

 Taking the factors like security, rate of return and time in consideration
which among the Following you rate as per the best option?

(a) Bank FD’s (b) commodity market (c) Bonds

(d) Equity/ derivative (e) Mutual funds

 What are the bases upon which people decide to invest in stock market?

(a) Technical analysis / fundamental analysis

(b)Market call / tips

(c) Popularity of security

(d) Goodwill of the company

 Which one you prefer most?

(a) Technical analysis

(b) Market tips / calls

 How much you believe on technical analysis of stock or how much right
result can be acquired by doing the technical analysis of any scrip?

(a)40% ( b ) 40-50% ( c ) more than 50%

(d) Does not believe at all

 Is the technical analysis easy to understand even by a simple investor?

(a) Yes (b) no

 If your base to choose the scrip is market calls / market tips, and then
what are the sources you trust upon most?

(a) market tips by security based company on mobile .

(b) T.V channel like CNBC

(c) stock brokers

 Up to what percent market tips are correct according to you?

(a) 30% or less (b) 30%-50% (c) 50%-60%

(d) More than 60%

 Do you think will securities market grows?

(a) Yes (b) no .

Bibliography

1. Library of company and college

2. www.motilaloswal.com/home

3. www.google.com and other search engine

4. www.wikipedia.com

5. The website of National Stock Exchange, Bombay Stock Exchange, Security

Exchange Board Of India and also other supporting webpage’s of Motilal
Oswal Securities Limited.

Jitendra
Virahyas
JVIRAHYAS@GMAIL.COM