A Term Paper

For

Management of Principles and

Applications
On

A Study on The Management of Zerodha

Broking Private Limited

Submitted by:
Piyush Chaurasia
B.com(h) II Year Section-2 Roll no 5116
Submitted to:
Dr. Meghna Malhotra
Assistant Professor
Department of Commerce
Hansraj College
University of Delhi
 ACKNOWLEDGEMENT
I would like to convey my gratitude to my teacher in-charge Dr Meghna

Malhotra and the head of the institution Dr Rama who gave me the wonderful

opportunity to prepare this term paper on Zerodha Broking Private Limited.

Piyush Chaurasia
 Table of Contents
Serial
Topic Page
NO.

 1  INTRODUCTION  4

 2  PLANNING  5

 3  ORGANISING  6

 4  STAFFING  8

 5  DIRECTING  10

 6  CONTROLLING  11

 7  COVID AND ITS IMPACT  12

 8  BIBLIOGRAPGY  13
 INTRODUCTION
Zerodha is an Indian financial company, member of NSE, BSE, MCX, MCX-
SX), that offers retail and institutional broking, currencies and commodities
trading, mutual funds, and bonds. Founded in 2010 with the goal of breaking all
barriers that traders and investors face in India in terms of cost, support, and
technology. Name the company Zerodha is a combination of ‘Zero’ and
‘Rodha’, the Sanskrit word for barrier.

The company is headquartered in Bangalore and has physical presence in

several major Indian cities. As of 2019, Zerodha is the largest retail stock broker
in India by active client base and contributes upwards of 2% of daily retail
volumes across Indian stock exchanges. Over 3+ million clients place millions
of orders every day through powerful ecosystem of investment platforms,
contributing over 15% of all Indian retail trading volumes.

Their disruptive pricing models and in-house technology have made them the
biggest stock broker in India in terms of active retail clients.

Rainmater a fintech fund and incubator, has invested in several fintech startups
with the goal of growing the Indian capital markets

In June 2020, Zerodha entered the unicorn club with a self-assessed valuation of
about $1 Billion. This valuation is based on the ESOP buyback exercise the
company undertook valuing each share at more than four times of the book
value of INR 700 per share.

PLANNING
Planning refers to the base of the other management functions. It is the
management of the organizations’ future in an uncertain environment. Plans can be
strategic, tactical, and operational. They can also be long-term or short-term. Plan
should be built on specific, attainable, and challenging objectives. In the materials
for the management course, it is mentioned that planning is important in that it
offsets uncertainty and change, focuses attention on objectives, helps in
coordination, gains economy of operation, helps in control, and increases
organizational effectiveness. In that sense it divides plans to standing and single-
use plans.

Zerodha Pvt Ltd believes that proper planning is a prerequisite to success. It is

concerned with the future impact of today’s decisions. In zerodha there is a section
that deals with planning issues. It prepares tactical and operational planning in
view of the project objectives. The planning that is made part of the Financing
Agreements with the respective development partner can be taken as a strategic
one. The short term plan of zerodha is to built a better version of their Nudge
feature an integrated assistant system kite. Nudge risk warnings that pop up when
users attempt to trade risky illiquid instruments and penny stocks. This was aimed
at first time investors who had suddenly taken interest in investing in the markets
during the Covid lockdown without knowing the risks of Penny stocks and often
fall victim of trade volatility.

They had also planned and very smoothly launched ketto a fundraiser to help daily
wage earners to get food and sanitation kits. In the long term zerodha plans always
focus on helping their customers become better investors and traders and provide
them with best trading terminal.

ORGANISING
Organizing refers to the organization of resources in an organization. Such

organization can be charted on an organizational chart. Through this function

management tries to determine the inside directorial configuration, establish and

maintain relationships, and also assign required resources of the organization. It

takes into consideration the objectives and tactics already identified in the planning

stage. The structure decides the division of labor, delegation of authority,

departmentation, span of control and coordination issues.

Zerodha follows functional organisational structure. It is very suitable for medium

sized firms having a single or small number of related products as in the case of

zerodha they are dealing mainly in broking activities in capital markets.

Benefits reaped by following this kind of organisational structure: -

1 Functional specialisation - Since emphasis is placed on specific functions. This

promotes efficiency in utilisation of manpower as employees perform same tasks

within a department and are able to improve performance.

2 Increased Operational efficiency – Functional organisational structure helps

Zerodha to increase their profit due to less operational and managerial efficiency.
3 Lower cost – It leads to minimum duplication of efforts which results in

economies of scale which results in lower costs.

4 Training of employees easier – It makes training of employees of zerodha to

easily adopt new techniques in their field of work.

ORGANISATIONAL STRUCTURE

Nithin Kamath Founder and Chief Executive Officer

Nikhil Kamath Co-founder and Chief Information

Officer

Austin Prakesh Director- Strategy

Hanam Delvi Chief of Client Relations

Dr. Kailash Nadh Chief Technology Officer

Venu Madhav Chief of Operations

Seema Patil Chief of Quality

STAFFING
Staffing functions follows the organizing function of management. Staffing refers to

the filling and keeping filled positions on positions created by the preceding

organizing function. Thus, staffing encompasses tasks such as recruitment,

selection, training and retraining of employees.

Zerodha provides training to its staff in view of the timely job-related developments

and requirements. For instance, the staffs are made to be actively involved in the

endeavours to upgrade themselves.

Similarly, Zerodha lays off its staff in view of staff’s reflections of incapacities in

doing the tasks or showing other behaviours that are believed against the norms of

the organization.

It is the right of the employees to receive the needed compensation related with the

job they undertook during their stay in Zerodha.

Recruitment and Selection Process

1. Written test (Aptitude) In written test the number of questions are 75 and time

limit for those questions are 35 minutes. The questions are from several topics like

ratio, simple logics, comparisons, analogy etc. The cut off marks for this round is

60%.

2. Technical written - Test in this round number of questions are 50 and time limit

are 25 minutes. Technical questions are from cloud computing and developer

languages subject. One has to be strong in his/her subjects to clear this round.

3. Technical and HR interview- After clearing both written test the final round is

technical and HR interview. It will take 1 hour and based on National merit test. In

this round some technical questions will be asked and in HR round the questions

will be asked about the company, projects, hobbies etc. Candidates are required to

produce original mark sheets/ certificates for verification during interviews.

DIRECTING
Directing refers to the control and supervision of the actions of the staff,

thus, enables them to achieve the company’s goals and also accomplishing

their personal or career goals which can be powered motivation,

communication, department dynamics, and department leadership.

Highly motivated people perform better than unmotivated people.

Motivation covers up ability and skill deficiencies in employees. Zerodha

gives motivation top priority. Employees are motivated through the

material, financial, as well as work environment privileges. This is very

important aspect that expedites the realizations of the objectives.

Besides, the communication issues are very important as part of the

directing function of management in the Zerodha. The staffs are careful

enough in their communicative efforts such as with customers, regulatories

etc.

The staffs are appraised for what they do, and disciplinary measures are

taken for incidents of misbehaviours.

CONTROLLING
Controlling refers to activities related to setting performance standards based

on the objectives of the organization, measuring and reporting actual

performance, comparing the two, and taking corrective or preventive action

as necessary.

Process for Controlling in Zerodha

1 Preliminary Control and Establishing Standards

Before launching any product or update the tech team conducts several testing

and

tries to find possible bugs.

2 Measurement of Performance

Performance is measured using complaints data and audit

3 Comparison of actual and Standard performance

Comparison is carried out to find all deviations in the goal and actual result and

magnitude of deviation decides whether corrective actions are required or not.

4 Taking remedial actions

 Corrective actions are implemented and then follow up is carried out to measure

the

Change.

COVID AND ITS IMPACT ON

ZERODHA

 While the Covid-19 lockdown brought about gloom for most

organisation zerodha has been witnessing substantial growth this
is because zerodha along with the rest of the broking industry has
witnessed considerable growth as a younger breed of millennial
investors is entering the financial markets. Falling interest rate and
flattening real yield have also aided in this surge.
Historically in a bull market equity participation rises. But this
time around we are facing very mature behaviour. During a bear
market valuations are low and the market corrects itself, it is an
excellent time to make long term investments.

 To meet the rising demand of account openings zerodha employees

were working very hard from their homes.

 Zerodha was able to ride the wave of negative oil prices and client
default because of their large amount of free cash flow and zero
debt obligations.
BIBLIOGRAPHY
 Bureau, ET. “Zerodha | ET Startup Awards 2020: Brokerage Firm Zerodha Selected
Startup of the Year.” The Economic Times, Economic Times, 24 Aug. 2020,
https://economictimes.indiatimes.com/small-biz/startups/newsbuzz/et-startup-
awards-2020-brokerage-firm-zerodha-selected-startup-of-the-
year/articleshow/77711970.cms. (Accessed on 03/09/2020)

 Dash, Sanchita. “Zerodha Valued Itself at $1 Billion, Hurun Unicorn Startups List
Bumps It up to $3 Billion but Founder Says Valuation Doesn’t Matter | Business
Insider India.” Business Insider, 4 Aug. 2020,
https://www.businessinsider.in/business/startups/news/zerodha-valued-itself-at-1-
billion-hurun-unicorn-startups-list-bumps-it-up-to-3-billion-but-founder-says-
valuation-doesnt-matter/articleshow/77347721.cms. (Accessed on 08/09/2020)

 Dwivedi, Aditya Bhushan. “Bootstrapped and Growing at 100% YoY Zerodha Aims to
Transform the Growing Fintech Market.” YourStory.Com, Yourstory, 3 Nov. 2015,
https://yourstory.com/2015/11/zerodha-2?utm_pageloadtype=scroll. (Accessed on
03/09/2020)

 “Interview Experience at Zerodha | Career Guidance.” Career Guidance,

https://www.firstnaukri.com/career-guidance/, 18 Jan. 2019,
https://www.firstnaukri.com/career-guidance/interview-experience-at-zerodha.
(Accessed on 08/09/2020)

 “Our 10th Anniversary and the Future – Z-Connect by Zerodha Z-Connect by

Zerodha.” Z-Connect by Zerodha, 15 Aug. 2020, https://zerodha.com/z-
connect/zerodha/bulletin-latest-at-zerodha/our-10th-anniversary-and-the-future .
(Accessed on 08/09/2020)

 “Zerodha Has Been Growing 100% Month-on-Month during the Lockdown without Any
Direct Marketing, Nikhil Kamath Tells Us How | Business Insider India.” Business Insider,
https://www.businessinsider.in/advertising/brands/article/zerodha-has-been-growing-100-
month-on-month-during-the-lockdown-without-any-direct-marketing-nikhil-kamath-tells-us-
how/articleshow/77068381.cms. Accessed 9 Sept. 2020. (Accessed on 03/09/2020)