BRIDGE GROUP SOLUTIONS

INTERIM REPORT

Submitted To: Submitted By:

Prof. Ranika Chaudhary Abhishek Gupta

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 IBS GURGAON

BRIDGE GROUP SOLUTIONS

A REPORT ON
EQUITY RESEARCH OF BANKING SECTOR

SUBMITTED BY

ABHISHEK GUPTA

18BSP1443

BRIDGE GROUP SOLUTIONS

A report in partial fulfillment in requirement of

PGPM Program

at

IBS GURGAON

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TABLE OF CONTENTS
S.No Topic Page
No.
Abstract 4
1. Company Profile 5
1.1 Vision Statement
1.2 Mission
1.3 Values
2. Introduction 8
2.1 What is equity?
2.2 What are equity shares?
2.3 Indian Equity Market
2.4 Who should make an equity investment>
2.5 Why to invest in equity shares?
3. Objectives of the study 10
4. My learnings 11
5. Future Plan of work 13

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ABSTRACT
The main aim of summer internship program is to help students gain experience from the
corporate world and make students well equipped with the required skills. This program helps
interns to understand the market and the sector they work in during the period of 14 weeks
and based on this understanding the interns simultaneously prepare a project on the work
allotted to them according to their domains.
The area of specialization taken by me is Finance and the research project will be on Equity
research of banking sector companies where I will study the fundamentals of financial
services sector, particularly banking sector and how equity research helps in decision making.
Financial services sector in India is growing rapidly. Initially, this sector was largely
dominated by the government, but with time and due to foreign investments this sector
expanded. It is witnessing expansion not only in existing financial services firms but also in
new entities entering the market. The financial services sector comprises of around 6% of the
GDP of India. It is expected that in the year 2019, this sector will have a good amount of
foreign investment and there might be a series of joint ventures between global and local
players.
Financial services are the professional services that provide investment, lending and
management of assets and money by individuals and corporations. In the current scenario,
investments by individuals are increasing as with the improvement in the living standards of
the people their financial needs are also increasing. However, many individuals are not able
to make best use of their savings as they don’t have proper knowledge of investments.
Currently, people invest in equity of companies due to good returns and hence to make a
beneficial investment it is important to have equity research. Equity research is used to
provide investor with a detailed analysis and recommendations on whether to buy, hold or
sell a particular investment.
As it is witnessed that banking sector is expected to grow, the investors are keen to invest in
this sector. Hence, it is important to know the current and future prospects of this sector and
have a proper understanding of the factors affecting the equity of any company which can
affect the decision of an investor. For this purpose, it is important to study the secondary data
regarding the banking sector and take into consideration the views of the people who invest
or are planning to invest in this sector.

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1.COMPANY PROFILE
Bridge Group Solutions (BGS) is an emerging leader in the highly unorganized and
diversified Financial Sector and aims to provide best investment solutions to the customers
and also establish its footprint in this sector, with its strong research capabilities and a robust
team of Expert, BGS provide solutions that will stand straight in each test. BGS is here not
just to build a customer base but to leave a legacy behind in the minds of our customers.
Bridge group Solutions help our customers foresee upcoming risks and help them reduce it
and at the same time maximise returns and take well planned and calculated investment
decisions through a well-trained team and its in-depth analysis and extensive research. Bridge
Group Solutions is promoted by a group of like-minded young professionals having deep
knowledge in providing investment solutions and consulting. BGS passionately driven by our
Vision of “being the Top Investment Solution Provider and a Trusted Brand”

1.1.VISION STATEMENT
“Most people don't plan to fail; they fail to plan" - John L. Beckley "
Our vision as a firm focuses to help our customers and communities realize their dreams by
anticipating, understanding and meeting financial needs"

1.2. MISSION
As a firm, BGS strive to provide financial peace of mind by delivering tailored objective
advice designed to give clients the confidence to pursue their own passion, dreams and
talents. We help our customers in financial and investment planning.

1.3. VALUE
INTEGRITY: Provide professional services with integrity.
OBJECTIVITY: Provide professional services with objectively.
COMPETENCE: Maintain the knowledge and skill necessary to provide professional
services.
PROFESSIONALISM: Act in a manner that demonstrates exemplary professional conduct.

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During the past days in the company I have worked on two different verticals of company:
MARKETING: I worked in this vertical for almost 30 days where, the company provided
with the brief knowledge of the insurance sector, various product, itstie up company and the
products we were supposed to pitch in market (Indiafirst Life Mahajeevan plan, child plans,
retirement plan and Aditya Birla health insurance). The pitch in process was aimed to make
us understand the mentality of people who are willing to negotiate for the insurance, the
various questions they ask. It is through this I understood the huge variability in the
behaviour of insurers and the need to understand and link correct product to correct group of
people.

PORTFOLIO MANAGEMENT SERVICES: This is the second vertical of the company

and we are working on the portfolio management services of our company. For 15 days we
were briefed with the importance of “Mutual Funds and Equity” and how to apply this in
doing financial planning for the clients. Post me and my team members are going to various
companies and introducing our company and service we provide, upon which the company if
interested will revert back to us. Now we will visit BGS clients along with our mentor how
they are fitting best products according to their needs. So, that they can maximize their
wealth. Meanwhile, I will be working on my project correspondently.

Currently the firm operates into three ventures

1. Financial Services (Gurugram Branch)
2. HR Outsourcing ( Rohini - Delhi Branch)
3. IT Services ( Noida Branch)

The Financial Services Sector is further divided into 4 sectors

1. Health Insurance – Aditya Birla, Star Health, ICICI Prudentials
2. Life Insurance – Max Life Insurance, IFAB
3. Mutual Funds – All Mutual Funds
4. Portfolio Management Services – , ICICI Securities

Bridgegroup Solutions is currently working on the schedule of being “mediator” and selling
the various financial products i.e. Term life insurance of “India First Life Company” (Joint
venture of Bank of Baroda, Andhra Bank & Legal & General (UK)).

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The major competitors of Bridge Group Solutions are:
 Motilal Oswal
 Angel Broking
 SMC Global
 Purnartha
 Capital First
 Wise Finserv

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2.INTRODUCTION
2.1. What is Equity?
Equity is typically referred to as shareholder equity (also known as shareholders' equity)
which represents the amount of money that would be returned to a company’s shareholders if
all of the assets were liquidated and all of the company's debt was paid off.
Equity is found on a company's balance sheet and is one of the most common financial
metrics employed by analysts to assess the financial health of a company. Shareholder equity
can also represent the book value of a company.

2.2. What are equity shares?

An equity share, commonly referred to as ordinary share also represents the form of
fractional or part ownership in which a shareholder, as a fractional owner, undertakes the
maximum entrepreneurial risk associated with a business venture. The holders of such shares
are members of the company and have voting rights.

2.3. Indian Equity Market

Most of the trading in the Indian stock market takes place on its two stock exchanges:
the Bombay Stock Exchange (BSE) and the National Stock Exchange(NSE). The BSE has
been in existence since 1875. The NSE, on the other hand, was founded in 1992 and started
trading in 1994. However, both exchanges follow the same trading mechanism, trading hours,
settlement process, etc. At the last count, the BSE had more than 5,000 listed firms, whereas
the rival NSE had about 1,600. Out of all the listed firms on the BSE, only about 500 firms
constitute more than 90% of its market capitalization; the rest of the crowd consists of
highly illiquid shares.

Almost all the significant firms of India are listed on both the exchanges. NSE enjoys a
dominant share in spot trading, with about 70% of the market share, as of 2009, and almost a
complete monopoly in derivatives trading, with about a 98% share in this market, also as of
2009. Both exchanges compete for the order flow that leads to reduced costs, market
efficiency and innovation. The presence of arbitrageurs keeps the prices on the two stock
exchanges within a very tight range.

2.4. Who should make an equity investment?

The first characteristic that an ideal equity investor has is an ability and willingness to take
risk. Without risk tolerance in at least moderate levels, equity investment cannot be made or
held successfully. Thus the concept that says risk-averse investors should opt for fixed returns
investments instead of an equity investment such as an equity mutual fund. The next
important characteristic is an ability to stay invested for the long term. Novice investors tend
to panic easily and the volatile nature of equity investments can lead to substantial swings in
value of equity investments over the short term. This short term volatility does even out in
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due course but that can happen only if the investor stays invested in the long term ideally five
years or more. These two are probably the most important features that an equity investor
should possess but having understanding of how markets work and help from a good
financial advisor can definitely improve chances of making a successful investment.

2.5. Why to invest in Equity Shares?

Equity shares are one of the best long-term investments in the financial market place. They
tend to outperform government bonds, corporate bonds, property and many other types of
asset. Share prices can go down as well as up so buying shares is not without risk, but over
the long term, they can generate good returns. If you want to double your money in a year,
for example, buying shares is not the best way to do it. But if you want to invest for ten or 20
years, shares may be a rewarding investment.

Shares are designed to provide investors with two types of return, annual income and long-
term capital growth.

Most shares offer income in the form of dividends. Dividends can be seen as a reward for
shareholders. They are paid when a company is profitable and has cash in the bank after it has
satisfied all its obligations. In most cases, the more profitable a company is, the higher the
dividend payments. If a company is making substantial amounts of money and making
significant dividend payments, it is usually considered a good investment so the share price
rises.

Investors may buy shares specifically for income. Many companies generate substantial
amounts of cash every year. They may use some of that money for general corporate
purposes, such as paying rent and wage bills, and they may use some of the money to invest
in equipment, research and development. But a proportion of that money may be paid to
investors as a dividend. As dividends are usually paid out once a year, they can provide
investors with a regular income.

Companies that pay generous dividends are known as income stocks.

Some companies have heavy investment programmes so they plough their profits back into
the business. These companies are often at an early stage of their development and they are
keen to expand and grow. They are known as growth businesses and, if their plans succeed,
their share price will increase substantially.

Long-term capital growth comes about when a share price increases over a period of time.

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3.Objectives of the study
 To provide an overview on the banking sector and the stocks they provide.
 To study major banks in India and their investment prospects
 To justify current investment in the securities chosen.
 To recommend increase or decrease of investments in a chosen security.
 To provide investment decisions to prospective buyers.

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4.MY LEARNINGS
Our internship has been divided into 2 Modules, based on which we are working. The first
module included sales to the customers which had to be completed within the given time
period. Currently we are working on the second module which includes training on the
Mutual Funds and further providing Portfolio Services to the companies.
MODULE 1(Sales to the Customers - B2C)
• The first module started with training program which went on for 2 weeks. We were given
training about insurance policies of India First Life Insurance, Aditya Birla Health Insurance
and Maxlife Insurance.We were provided time period to work on field for making sale,
experiencing the field strategy and mould our learning on project titles. We spent around a 15
Days on field work, post which we were called back and assigned work on different verticals
of company.
• The minimum target to be achieved was worth Rs.50, 000, which was to be achieved
within the time period allotted. The time period allotted was from 4th March’19 till 15th
March’19. Further the amount was to be deposited in the company to the undersigned
Company Guide.
• The product sold was MahaJeevan Plan of India First . The pitching of almost 30 clients
was done and out of them ttwo were converted. The two clients thus applied for the policies
worth “Rs25,900” &“Rs27, 000”, which in all made “Rs 52,900” , hence completing my
target for the first module.

The Client Generation Process thus included certain steps such as

1. Pitching of Clients (Calling and References)
2. Briefing the clients regarding the Investment Plans
3. Closing the sale by collecting the cheque or cash from the clients and also finishing the
form filling procedure.

MODULE 2(Portfolio Management to the Companies)

• Under this first we were gone through the basic understandings of the Mutual Funds.

➢ WHAT ARE MUTUAL FUNDS?

• A mutual fund is a professionally managed investment fund that pools money from many
investors to purchase securities. These investors may be retail or institutional in nature.
Mutual funds have advantages and disadvantages compared to direct investing in individual
securities. The primary advantages of mutual funds are that they provide economies of scale,
a higher level of diversification, they provide liquidity, and they are managed by professional
investors. Primary structures of mutual funds include open-end funds, unit investment trusts,
and closed-end funds.

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➢ ADVANTAGES OF MUTUAL FUND
• Not to spend much time in the market.
• Diversified Portfolio
• Regular Investment
• Maintenance of liquidity (easily converted to cash when required)
• Risk can be distributed.

➢ CHALLENGES
• Mutual Funds are subjected to market Risks.

The structure of Mutual Funds is as follows

SPONSOR

AMCS TRUST MUTUAL FUND TRUSTEE

PUBLIC INVESTS RETURN

In all there are 41 Mutual Fund Companies.

I learned that these mutual fund Companies have been categorized by SEBI as follows

Less than 1000cr Micro Cap

Smaller than 8844cr Small Cap
In between 8844cr and 29264cr Mid Cap
Larger than 29264cr Larger Cap

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➢ There are total three types of mutual funds available in market those are:
• EQUITY- MUTUAL FUND: These are those types of mutual fund in which fund manager
invests more than or equal to 65% of fund avail with him in equity shares (ownership funds)
and rest in debentures. These mutual funds for those who wants to invest in mutual for long
period.
• DEBT-MUTUAL FUND: These are those type of mutual funds in which funds manager
invest 65% of fund available in the debenture instruments and rest in the equity shares. These
mutual funds are preferred for those who wants to Invest in mutual funds for short period of
time like for 1 year.
• BALANCED-MUTUAL FUND: These are those mutual funds in which fund manager
keeps the ratio of equity and debenture equal. That’s why it is called balanced mutual fund.
These funds are suggested for those have low risk appetite.

5.Future Plan of work

I intend to accomplish the following tasks in the coming 6 weeks in Bridge Group Solutions:
 Gain knowledge about equity, mutual funds and other financial instruments.
 Visit corporate offices for offering financial services.
 Learn how to manage a portfolio.
 Study the equity market of the banking sector.

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