A Project Study Report On Training undertaken at INDIA INFOLINE COMPANY LIMITED


“ROLE OF SHARE MARKET IN INDIAN ECONOMY” Submitted in partial fulfillment for the Award of degree of Master Of Business Administration



(2010-2011) Subodh Institute Of Management And Career Studies BR SHAH MBA BLOCK, Rambhag Circle, Jaipur-302004



I express my sincere thanks to my project guide, Mr. ____________________ Department for guiding me right from the inception till the successful completion of the project. I sincerely acknowledge him for extending their valuable guidance, support for literature, critical reviews of project and the report and above all the moral support he had provided to me with all stages of this project. I would also like to thank the supporting staff for their help and cooperation throughout our project.

Vinit Sharma

the report presented has not been presented anywhere. collected and processed during the course of my summer internship with INDIA INFOLINE COMPANY LIMITED. Vinit Sharma PREFACE .DECLARATION I hereby declare that the information presented here is correct to the best of my knowledge and has been prepared on the basis of information gained. Also.

What is the concept Demat? 4.Hence to fulfill this requirement. What actually the Share market means? 2. What does customer choice regarding broker service? 6. I felt like stepping into altogether a new world. My training in India Infoline taught me about:1.This experience is very valuable for the student & plays a leading and important role in the career life of the student . At first everybody seems strange and unheard but as the time passes. When I entered in organization.It is well evident that work experience is an indispensable part of every profession course . during the training period the student learns through his own experience. one understanding the concept & the working of the organization and their by develop professional relationship. the I completed my training in the INDIA INFOLINE. Initially it is felt as if classroom study was irrelevant and it is use less in my concern’s working but gradually it is realized that all the basic fundamental concept studied are linked in one other ways to the organization but how & what can be done with the fundamentals depends upon the intellectual & applicability of the individual it is just the matter to modify the theory so to apply it is to given practical solution sincerely believe that there is no better place to learn this practical training. the real situation of corporate and to put theoretical knowledge into practice .In the same manner practical training in any organization is must for each and every individual who is undergoing financial course without the practical exposure one cannot consider himself as a qualified manager. How the trading is done? 3. My topic of study as “Role of share market in indian economy” Share market has significance in the present corporate world. What are the factors one should keep in mind while dealing with shares? 5. How share market effects the economy? EXECUTIVE SUMMARY .

Table of contents SR. which manages the wealth of its clients. the history of share market. The company has appointed a large number of franchisees across India and treats its franchisees as its business partner. The company earns maximum of its revenue through brokerage. reforms in Indian economy and their impact on the economy and has discussed about the financial system of India. it has its branches in almost all the parts of India. . This project report is about the history of Indian economy and share market where under the heading of share market I have included. NO. a questionnaire is prepared so as to understand the needs and requirement of the clients and investors. The most interesting part in any internship. for a learner is the application of concepts and as my project is on “ROLE OF SHARE MARKET IN INDIAN ECONOMY” I got know about the industry in depth vis a vis the Indian economy. the major problems of the Indian economy. Sample size is of 200 investors who are keenly interested in share market and deal regularly. having its head office in Delhi. This project also give you the information about the significance of Share market and its impact on GDP of the country and the multiple roles that share market play in an economy. Further. The company is not just a share broking house it is a wealth management company. The detail then gathered will be assembled and analyzed to make further suggestions.India Infoline is one of the leading share broking companies. as a client ad their products and services were studied. some aspects of the share market in post liberalisation period and the multiple roles that share market play in Indian economy. PARTICULARS Page No. For the purpose a survey was conducted which included visiting different brokerage firms.

Its history dates back to nearly 200 years ago.4 3. there were only half a dozen brokers recognized by banks and merchants during 1840 and 1850.1 3.6 3. Though the trading list was broader in 1839. The 1850's witnessed a rapid development of commercial enterprise and brokerage business attracted many men into the field and by 1860 the number of brokers increased into 60.1. The earliest records of security dealings in India are meagre and obscure.7 4 5 6 7 8 9 10 INTRODUCTION TO THE INDUSTRY INTRODUCTION TO THE ORGANIZATION RESEARCH METHODOLOGY TITLE OF THE STUDY DURATION OF THE STUDY OBJECTIVE OF THE STUDY TYPE OF RESEARCH SAMPLE SIZE AND METHOD OF SELECTING SAMPLE SCOPE OF THE STUDY LIMITATION OF THE STUDY FACTS AND FINDINGS DATA ANALYSIS AND INTERPRETATION SWOT ANALYSIS CONCLUSION RECOMMENDATIONS AND SUGGESTIONS APPENDIX BIBLIOGRAPHY INTRODUCTION TO THE INDUSTRY Indian Stock Markets are one of the oldest in Asia. The East India Company was the dominant institution in those days and business in its loan securities used to be transacted towards the close of the eighteenth century. By 1830's business on corporate stocks and shares in Bank and Cotton presses took place in Bombay.2 3. 2.3 3. 3 3.5 3. .

Indian cotton and jute textiles. when boom faded. In the beginning of the twentieth century. the number of members stood reduced from 100 to 3. thus. in 1865. many mills originated from Ahmedabad and rapidly forged ahead. paper and flour mills and all companies generally enjoyed phenomenal prosperity. On June 1908. However. due to the First World War. In 1895. the Stock Exchange at Bombay was consolidated. the need for a Stock Exchange at Ahmedabad was realised and in 1894 the brokers formed "The Ahmedabad Share and Stock Brokers' Association". in the 1870's there was a sharp boom in jute shares. the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. . Other leading cities in stock market operations Ahmedabad gained importance next to Bombay with respect to cotton textile industry. they formally established in Bombay. However. which was followed by a boom in tea shares in the 1880's and 1890's. the brokers who thrived out of Civil War in 1874. Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. and so it went out of existence. sugar. and a coal boom between 1904 and 1908. the "Native Share and Stock Brokers' Association" (which is alternatively known as “The Stock Exchange "). What the cotton textile industry was to Bombay and Ahmedabad. some leading brokers formed "The Calcutta Stock Exchange Association". Thus. and with the inauguration of the Tata Iron and Steel Company Limited in 1907. at the end of the American Civil War. steel. In 1887. Also tea and coal industries were the other major industrial groups in Calcutta. At the end of the American Civil War. found a place in a street (now appropriately called as Dalal Street) where they would conveniently assemble and transact business. the industrial revolution was on the way in India with the Swadeshi Movement. under the name and style of "The Madras Stock Exchange" with 100 members. a disastrous slump began (for example. an important stage in industrial advancement under Indian enterprise was reached. In 1920. After 1880. by 1923.In 1860-61 the American Civil War broke out and cotton supply from United States of Europe was stopped. the then demure city of Madras had the maiden thrill of a stock exchange functioning in its midst. the jute industry was to Calcutta. 87). As new mills were floated. The number of brokers increased to about 200 to 250. After the Share Mania in 1861-65. the 'Share Mania' in India begun.

for nearly two decades. the situation changed radically. in 1943. seeds and other commodities. It was merged with the Punjab Stock Exchange Limited. But. Post-independence Scenario Most of the exchanges suffered almost a total eclipse during depression. Indian Stock Exchanges The Second World War broke out in 1939. many stock exchanges were established at present. those dealing in them found in the stock market as the only outlet for their activities. Delhi. Many new associations were constituted for the purpose and Stock Exchanges in all parts of the country were floated. 1956. Lahore Exchange was closed during partition of the country and later migrated to Delhi and merged with Delhi Stock Exchange. Only Bombay. especially in South India where there was a rapid increase in the number of textile mills and many plantation companies were floated. Hyderabad and Indore. They were anxious to join the trade and their number was swelled by numerous others. amalgamated into the Delhi Stock Exchange Association Limited. bullion. Thus. during early sixties there were eight recognized stock exchanges in India The number virtually remained unchanged. the well established exchanges. Lahore Stock Exchange was formed in 1934 and it had a brief life. During eighties.In 1935. the stock market activity improved. It gave a sharp boom which was followed by a slump. however. which was incorporated in 1936. there are totally twenty one recognized stock exchanges in India excluding the Over the Counter Exchange of India Limited (OTCEI) and the National Stock Exchange of India Limited (NSEIL).were floated and later in June 1947.Madras Stock Exchange Association (Pvt) Limited. Ahmedabad. when India was fully mobilized as a supply base. were recognized under the Act.Delhi Stock and Share Brokers' Association Limited and the Delhi Stocks and Shares Exchange Limited . a stock exchange was once again organized in Madras . Most of the other exchanges languished till 1957 when they applied to the Central Government for recognition under the Securities Contracts (Regulation) Act. Calcutta. In Delhi two stock exchanges . Madras. On account of the restrictive controls on cotton. . In 1937.

(lakh) 8 Appreciated Capital per value of 170 148 126 170 260 344 803 167 211 298 582 1770 5564 . As on 31st December 1 No. Rs. and this was due to the favouring government policies towards security market industry.) 7 MarketValue of Capital 107 per Listed Cos. The remarkable growth after 1985 can be clearly seen from the Table. 4 Capital of Listed Cos. Rs. No. It is quite evident from the Table that Indian stock markets have not only grown just in number of exchanges. of Stock Issues of Listed Cos. (Cr.) 5 Market value of Capital of Listed Cos. of Listed Cos.N.) 6 Capitalper Listed Cos. but also in number of listed companies and in capital of listed companies. 63 113 168 175 224 514 693 1292 2675 3273 6750 25302 110279 478121 753 1812 2614 3973 9723 32041 59583 1203 2111 1599 2838 1552 3230 2265 3697 4344 6174 6229 8967 8593 11784 7 8 8 9 14 20 22 1961 1971 1975 1980 1985 1991 1995 (4/2) (Lakh Rs.The Table given below portrays the overall growth pattern of Indian stock markets since independence. Growth Pattern of the Indian Stock Market S. (Cr. of Stock Exchanges 2 3 No.

) Trading Pattern of the Indian Stock Market Trading in Indian stock exchanges are limited to listed securities of public limited companies. such as. specified securities (forward list) and non-specified securities (cash list). SBI Capital Markets.Listed Cos. unduly long settlement periods and benami transactions. Industrial Finance Corporation of India.OTCEI . General Insurance Corporation and its subsidiaries and CanBank Financial Services. electronic stock exchange . A member broker in an Indian stock exchange can act as an agent. absence of liquidity. (Lak Rs.was created in 1992 by country's premier financial institutions . which affected the small investors to a great extent. They are broadly divided into two categories. scrip less. Industrial Development Bank of India. Two types of transactions can be carried out on the Indian stock exchanges: (a) spot delivery transactions "for delivery and payment within the time or on the date stipulated when entering into the contract which shall not be more than 14 days following the date of the contract”: and (b) forward transactions "delivery and payment can be extended by further period of 14 days each so that the overall period does not exceed 90 days from the date of the contract". normally. Equity shares of dividend paying. The brokers who carry over the outstanding pay carry over charges (can tango or backwardation) which are usually determined by the rates of interest prevailing. Securities traded on the OTCEI are classified into: . Trading at OTCEI is done over the centres spread across the country. Over The Counter Exchange of India (OTCEI) The traditional trading mechanism prevailed in the Indian stock markets gave way to many functional inefficiencies.Unit Trust of India. buy and sell securities on his own account and risk. The latter is permitted only in the case of specified shares.50 million and a market capitalization of at least Rs. namely.100 million and having more than 20. buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal. the country's first ring less. lack of transparency. To provide improved services to investors. put in the specified group and the balance in non-specified group. Industrial Credit and Investment Corporation of India.000 shareholders are. growth-oriented companies with a paid-up capital of at least Rs.

institutions and corporate bodies enter into high value transactions in financial instruments such as government securities.Any equity holding at least one lakh debentures of particular scrip can offer them for trading on the OTC. National Stock Exchange (NSE) With the liberalization of the Indian economy. commercial paper. Trading at NSE can be classified under two broad categories: (a) Wholesale debt market and (b) Capital market.Certain shares and debentures listed on other exchanges and units of mutual funds are allowed to be traded Initiated debentures . Participants include trading members and large players like banks who take direct settlement responsibility.• Listed Securities . Industrial Finance Corporation of India. . selected commercial banks and others. Wholesale debt market operations are similar to money market operations . it was found inevitable to lift the Indian stock market trading system on par with the international standards.The shares and debentures of the companies listed on the OTC can be bought or sold at any OTC counter all over the country and they should not be listed anywhere else • • Permitted Securities . Recognized members of NSE are called trading members who trade on behalf of themselves and their clients. On the basis of the recommendations of high powered Pherwani Committee. etc. the National Stock Exchange was incorporated in 1992 by Industrial Development Bank of India. public sector unit bonds. certificate of deposit. all Insurance Corporations. There are two kinds of players in NSE: (a) Trading members and (b) Participants. treasury bills. Industrial Credit and Investment Corporation of India.

India cannot afford to damage the capital market path. DIFFERENCE EXCHANGES BETWEEN OTC EXCHANGE AND OTHER STOCK With the recognition of OTC exchange. Usual stock exchanges have trading rings where the brokers come together and deal in securities in conventional manner. And capital market being one of the major source of long-term finance for industrial projects. 2.Usual stock exchanges are localized and operate in a particular area. NSE has several advantages over the traditional trading exchanges. Madras and other one being the OTC Exchange. In this regard NSE gains vital importance in. But in OTC exchange there will be no trading and the deals will be struck only through wide spread on-the-line computer network. Delhi. They are as follows: • • • NSE brings an integrated stock market trading network across the nation. the securities market in India has become two tiered the first one being the main Stock Exchange like Bombay. late payments and the malpractice’s prevailing in the traditional trading mechanism can be done away with greater operational efficiency and informational transparency in the stock market operations. Unless stock markets provide professionalised service. The prices at which the buyer and seller are willing to transact will appear on the screen. Investors can trade at the same price from anywhere in the country since inter-market operations are streamlined coupled with the countrywide access to the securities. with the support of total computerized network. But OTC Exchange is not localized and its area of operation extends to the whole of India. When the prices match the transaction will be completed and a confirmation slip will be printed at the office of the trading member. . The basic differences between them are as under-: 1. Delays in communication. small investors and foreign investors will not be interested in capital market operations.Trading at NSE takes place through a fully automated screen-based trading mechanism which adopts the principle of an order-driven market.

3. In usual stock exchanges. the eligibility criteria for listing is that the company must have the minimum issued equity capital of Rs. a Company will have to appoint a member of the OTC exchange as ‘Sponsor’. ➢ Power to call any information or explanation from recognized stock exchanges or its members. In Stock exchanges.00 Lacs out of the minimum public offer should be Rs.00crores is not eligible for listing. For listing in OTC exchange. 30. but in OTC Exchange a company having an issued equity share capital of more than Rs. ➢ Protect the investors in Securities Market ➢ To promote the development of Securities Market ➢ Regulate the Securities Market Following powers have ban given to SEBI with the enactment of SEBI with enactment of SEBI Act 1992: ➢ Power to call for periodical returns from recognized Stock Exchanges.20. a company can have minimum issued Equity capital of Rs.25.00 Lacs in face value. A company can directly enter the other stock exchanges and get its shares listed. SEBI’S ROLE AS A REGULATOR According to the preamble to the SEBI Act the objective of setting up SEBI was to protect the interest of the investors.00 Crores. there is no upper limit fixed on issued equity share capital. SEBI has thus three objectives cast upon it by the Act. but it is not so in the case of OTC Exchange. The member appraises the project and after being satisfied about the viability of the project and its investment worthiness accepts to become its sponsor. 5. .3. But for listing in OTC exchange. 4.

➢ Power to declare applicability of section 17 of the Securities Contract (Regulation) Act in any State or area to grant licenses to dealers in securities. ➢ Power to conduct research and other functions. ➢ Power to promote and regulate self-regulatory bodies.000 corporate brokers. SEBI. ➢ Power to make or amend bye-laws of recognized exchanges. A lot of investor protection guidelines have also been framed and implemented. a wide range of products. ➢ Power to register and regulate working of collective investment schemes including mutual fund. ➢ Power to regulate substantial acquisition of shares and takeover of companies ➢ Power to levy fees. ➢ Power to grant approval to bye-laws of recognized exchanges. ➢ Power to grant registration to market intermediaries. SEBI’s aforesaid powers and functions are not exhaustive in nature. an integrated platform for trading in both cash and derivatives. ➢ Power to promote investor’s education and trading of intermediaries in capital. regulation of mutual funds and market intermediaries. ➢ Power to compel listing of securities by public companies. and a nationwide network of trading through over 4. ➢ Power to prohibit inside trading. ➢ Power to control and regulate stock exchanges. reforms and transparency in primary and secondary markets. ➢ Power to prohibit fraudulent and unfair trade practices relating to securities.➢ Power to direct inquiries to be made in relation to affairs of stock exchanges or opts members. as a regulatory and development agency has wide and varied powers SEBI’s efforts so far includes measures for efficiency. . Key strengths of the Indian securities markets The key strengths of the Indian capital market include a fully automated trading system on all stock exchanges. The securities markets in India have made enormous progress in developing sophisticated instruments and modern market mechanisms.

Securities and Exchange Board of India (SEBI) is an independent and effective regulator. derivative trading and takeover of companies. the growth in volume of securities transactions. risk management. transparency and safety. settlement cycles. Information technology is extensively used in the securities market. There is a well designed disclosure based regulatory system.The real strength of the Indian securities market lies in the quality of regulation. and the level of compliance with international standards have earned for the Indian securities market a new respect in the world. The market regulator. the significant improvements in efficiency. PORTER’S 5 FORCES ANALYSIS LOW Competitive Bargain of Threat of new form rivalry among suppliers substitute power of entrants firms buyers . the reduction in transaction costs. trading mechanism. The NSE and BSE have most advanced and scientific risk management systems. The growing number of market participants. It has put in place sound regulations in respect of intermediaries.

So it is quite high switching cost. etc. SHCIL. NSE & BSE are playgrounds where common an investor trade through stock broking houses. Web maintainers are companies which maintain web sites & technical aspects of the same. MCX & NCDEX are stock exchanges which trade in commodities and derivatives.com. Web maintainers are companies who make and maintain software’s for stock broking houses. have low bargaining power. NSE & BSE are under the purview of SEBI.MEDIUM HIGH HIGH HIGH Bargain power of suppliers NSDL & CSDL are the regulatory bodies for Depository Participants like SSKI. Here again stock broking houses have to follow rules and regulation of the same. Bargain power of buyers . Also these regulatory bodies have got an upper hand as the bargaining power stock broking houses like SSKI. But here there is one advantage that NSE/BSE have i. would be less. for which they have to take permission from NSE/BSE.e. etc. ICICIdirect. they cannot go for forward integration. Here stock broking houses like SSKI can have more bargaining power due to stiff competition among web maintaining companies. If say for example stock broking houses switches over to other web maintainers then that company cannot understand the mechanisms of software’s. that’s why stock broking houses like SSKI.

If the use of this instruments increase this may be disadvantage for the stock broking houses. But the in case of mutual fund companies and institutional investors bargaining power is less. MotilalOswal. Here the bargaining power of stock broking houses depends on how big the investor is. 5paisa and Marwadi encircles the company form both the sides by providing online and off-line trading with competitive services. Threat of substitute Here substitutes are such instruments which can be used instead of investing in shares. Competitive Rivalry The company is facing the competition from local as well as national level players. . insurance. institutional investors and mutual fund companies. So switching cost is pretty much less.g. HDFC Security provide online trading services There are also other big names like Indiabulls. The instruments like Bank FD.com. Nationalized banks are also thinking to enter in this field by tying up with broking houses. business partners.com and Kotakstreet.There are various types of investors who trade through stock broking houses like SSKI. competitors are offering low brokerage and best services with added feature. The local players provide facility for off-line trading while the national players like ICICIdirect. While the bargaining power is moderate in case of HNI (High New Worth Investors)/ MNI’s (Medium Net Worth Investors) and business partners. So here we can say that bargaining power of stock broking houses is high in case of small investors & HUF. So the buyer can easily switch over to competitors product. E. There is competitive buzz in stock broking industry. Jeojit and Cipher which are coming in near future to Rajkot City. mutual funds are the substitutes. medium net worth investors. Threat of Entrants The potential entrants in like Invest mart. Bank Of Baroda. which includes investors like small investors.

The companies and banks which are having these instruments can plunge into this industry. The alternative is to choose a portfolio that has a high degree of correlation with the market. SHARE MARKET CONCEPT What’s a Stock Index? An index is a number used to represent the changes in a set of values between a base time period and another time period. What does the number mean? The index value is arrived at by calculating the weighted average of the prices of a basket of stocks of a particular portfolio. This portfolio is called the index. How are the Stocks in the portfolio weighted? There are basically three types of weighing:  Market capitalization weighted  Price weighted . What’s a Stock Index? A Stock Index is a number that helps you measure the levels of the market. In order to benchmark the portfolio against the market we need some efficiency proxy for the market. Indexes differ based on the method of assigning the weight ages to the stocks in the portfolio. But why the portfolio? Why not the entire market? This is because for someone who wishes to replicate the return on the market it is infinitely more expensive to buy the whole market and for small port folio size it is almost impossible. Indexes arose out of this need for a proxy. portfolio attempts a high degree of correlation with the market. Most stock indexes attempt to be proxies for the market they exist in. Why do we need an index? Students of modern portfolio theory will appreciate that the aim of every portfolio manager is to beat the market.

 Higher Liquidity or Lower Impact cost. Equal weighted As may be discerned. Though this seems like an easy task. Who owes the index? Who computes it? Typically exchanges around the world compute their own index and own it too. capitalization weighted indexes. What is the better weighing option? The market capitalization weighted model is the most popular and widely considered to be the best way of determining the index values. in practice it is very difficult to achieve due to a number of issues.S. the stocks in the index could be weighted based on there individual prices. Industry Representation Since the objective of any index is to be a proxy for the market it becomes imperative that the board industry sectors are faithfully represented in the index too. (Owned by S&P which is a credit rating company) and the strait times Index in Singapore (Owned by the newspaper of the same name).  Maximum coverage of market capitalization. not least of them being the basic method of industry classification. Most indexes attempt to strike a balance between the following criteria. . Who decides what stocks to include? How? Most index providers have a index committee of some sort that decides on the composition of the index based on standardization selection and elimination criteria.  Better industry representation. There are notable exceptions like the S&P 500 Index in the U. The criterion for selection of course depends on the philosophy of the index and its objective. In India both the BSE-30 Sensex and the S&P CNX Nifty are market. The sensex and the Nifty are case in point. their market capitalization or equally.

What are the popular indexes in India? * * * * * BSE-30 Sensex BSE-100 Natex BSE Dollex BSE-200 BSE-500 * * * * * S&P CNX Nifty S&P CNX Nifty Jr. While it has to be responsive to the changes in the market place and allow for new industries or give up on dead industries. An liquid stock has state prices and this tends to give a flawed value to the index. S&P CNX Difty S&P CNX Midcap S&P CNX 500 What are the sectoral indexes? . It is important from the point of usability for all the stocks that are part of the index to be highly liquid the reasons are two-fold. at the same time it should also maintain a degree of continuity in order to survive as a benchmark index. This cost is also called the impact cost of the index. Further for passive fund managers. to ensure coverage of some minimum level of the capitalization of the entire market. What is the Benchmark Index? An index which acts as the benchmark in the market has an important role to play. it is quite a balancing act to achieve the same minimum level for every industry. However.Market Capitalization Another objective that most index providers try to achieve it. Liquidity or Impact cost. As a result within every industry the largest market capitalization stock tend to select themselves. the entry and exist cost at a particular index level is high if the stocks are illiquid.

No request for change of ownership is entertained during this period. In this case the best way out is to send the shares for transfer before the book closure date to avoid any hassles. bearing a date on the transfer deed earlier than the book closure. S&P and WEBS products are amongst most popular products.These indexes provide the benchmark for sector specific funds. This is also known as passive management. What is record date? The record date is a cut off date announced by the company on which the shareholders registered in the Register of members maintained by the company and are entitled of receiving the benefits announced by the company such as Dividend. These are pretty popular world wide with non-resident investors who like to take an exposure to the entire market. Financial sector. . Pharmaceuticals. Bonus etc. Manufacturing or Infrastructure use these index to keep track of the sector performance. What are the uses of an Index? Index based funds These funds tend to replicate the index as it is in order to match the returns on the market.  UTI’ fund on the Sensex Exchange traded funds (ETFS) These are similar to index funds that are traded on an exchange. Examples in India are: IDBI M F’s fund on Nifty. Fund managers and other investors who track particular sector of the economy like Technology. What is a book-closure date? Companies close their share registry books for a few days for the purpose of decimating corporate benefits like dividend or bonus. Physical shares cannot be sold on an exchange. Their argument is that it is not possible to beat the market over a sustained period of time through active management and hence it is better to replicate the index.

bonus or right declaration has been made by a company. Speculative activity in the stock normally increases during the no delivery period. also. Obviously. Investors are advised to look for the No Delivery period of the stocks since if the shares are sold during the no delivery period. tax free dividend income can be earned and simultaneously a capital loss can be booked which can be claimed as set off against any other capital gain. If any dividend. . investor purchasing the share before record date becomes entitled to this dividend etc. As soon as these entitlements gets detached from the share it becomes ex-dividend/exBonus/ex-right. This is a sort of extended settlement period for the securities. By purchasing shares cum-dividend and selling them ex-dividend. This is called dividend stripping. stock exchanges set up nodelivery periods for the concerned securities. price of shares decreases the moment it becomes ex-dividend. Payment shall be received only after the end of this period. He is called to have purchased the shares cum-dividend/cum-bonus/cum-right. Though trading is permitted during the period but no physical exchange of shares take place.What is no-delivery period? When ever companies announce book closure or record dates.

It commenced operations as an independent provider of information. 1995 as Probity Research and Services Private Limited at Mumbai under the Companies Act. 11 93797.INTRODUCTION TO THE ORGANISATION COMPANY HISTORY India Infoline was incorporated on October 18. to institutional Customers. financial markets and economy. 1956 with Registration No. 2000 and later to India Infoline Limited on March 23. analysis and research covering Indian businesses. The name of the Company was changed to India Infoline. It became a public limited company on April 28. 2000 and the Name of the Company was changed to Probity Research and Services Limited. 2001. .com Limited on May 23.

the name of Company was changed to India Infoline.000 customers with a staff of. www. Agri operated 32 branches in South and West India serving more than 30. India Infoline acquired 100% of the equity shares of Agri Marketing Services Limited. In May 2000.indiainfoline. like mutual funds and RBI Bonds. independent research.com through their subsidiary.com in May 1999 and started providing news and market information. It combined competitive brokerage rates and research. These activities were carried on by our wholly owned subsidiaries.com Limited to reflect the transformation of business. market news and price charts with multiple tools for technical analysis. Acquisition of Agri Marketing Services Limited (Agri)— In March 2000.482 of their equity shares.com Distribution Company Limited. India Infoline leveraged their position as a provider of financial information and analysis by diversifying into transactional services. they changed the company name to India infoline. they also offer real time stock quotes. the e-broking portal. India Infoline broking services was launched under the brand name of 5paisa. At the time of our acquisition.com.5paisa. Agri was a direct selling agent of personal financial products including mutual funds. India Infoline identified the potential of the Internet to cater to a Mass retail segment and transformed there business model from providing information services to institutional customers to retail customers. fixed deposits.In 1999. was launched for online trading in July 2000. supported by Internet technology Besides investment advice from an experienced team of research analysts. After the acquisition. interviews with business leaders and other specialized features. India Infoline Securities Private Limited and www. approximately 180 employees. from their owners in exchange for the issuance of 508. . In the year 2000. India Infoline emerged as one of the leading business and financial information services provider in India. Hence launched their Internet portal. Over a period of time. primarily for online trading in shares and securities and online as well as offline distribution of personal financial products. corporate bonds and post-office instruments.

The issue is slated to open on April 21 and close on April 27. -India Infoline to buy 75-pc stake in Money tree 2006 -India Infoline launches exclusive SMS Value Added Service -India Infoline enters into strategic agreement with Sara swat Bank -India Infoline to launch stock trading on cell phones . launched Portfolio Management Service. launched archives. The company is coming out with public issue of 1. Indiainfoline.Milestones 1995 -Incorporated as an equity research and consulting firm with a client base that included leading FIIs.com mobilised capital from reputed private equity investors. entered life insurance distribution as a corporate agent.18 crore shares with a face value of Rs 10 through the book building route.India Infoline fixes a price band between Rs 70 and Rs 80 for its forthcoming public issue.6 times oversubscription -IIL appoints R Mohan as VP -India Infoline Ltd has informed that the Company has entered into a advertising agreement with Times Group where in the Company and other group companies would spend about Rupees Thirty Crores over the next 5 years in print as well as non print media of The Times Group. launched online equity trading. consulting firms and corporate. 2000 -Commenced the distribution of personal financial products. Acknowledged by Forbes as ‘Best of the Web’ and ‘must read for investors’.Listed on the Indian stock markets . Enam Financial Consultants Private Ltd would be the sole book running lead manager to the issue while In time Spectrum Registry Ltd is the registrar to the issue. -India Infoline public issue gets 6. 2005 . 2004 -Acquired commodities broking license. banks. 1999 -Restructured the business model to embrace the internet.

India’ award from Asia money. as an independent director on the Board of the 2009 -Received registration for a housing finance company from the National Housing Bank. inducted an institutional equities team.India Infoline Ltd has informed that the Board of Directors of the company have vide circular resolution passed on March 10. Ms. ‘Most Improved Brokerage. . .-India Infoline to roll out MCX. Falguni Sanghvi has been appointed as the Company Secretary with effect from October 07. DGCX software -Acquired membership of DGCX. . received the venture capital license. formed a Singapore subsidiary.The Company has splits its face value from Rs10/. Bank of India. set up India Infoline Private Equity fund. 2008. received ‘Best brokerIndia’ award from Finance Asia. 2008 -Launched wealth management services under the ‘IIFL Wealth’ brand. received ‘Fastest growing Equity Broking House COMPANY STRUCTURE . launched investment banking services 2007 -Launched a proprietary trading platform. 2008 approved the appointment of Mr. exChairman of the State Company. A K Purwar. received in principle approval to sponsor a mutual fund. launched consumer finance business under the ‘Money line’ brand. Company Secretary and compliance Officer of the Company. raised over USD 300 mn in the group. received the Insurance broking license from IRDA. NCDEX. Nimish Mehta.to Rs2/-.India Infoline Ltd has informed that pursuant to the resignation of Mr.

ServicesLtd Ltd. . portal& Operations Media financing FINANCIAL PROFILE Balance Sheet (Rs in Cr. ResearchFor New Co. Credit Ltd. Finance Insurance Investment Banking (Corporate Ltd Equity Agency) International Broking NBFC for distribution research. Ltd. Company Services Services Ltd. Insurance Distribution Marketing Money line IIFLMedia & Housing Investment INDIA Brokers Ltd. Commodities Equity Broking.IIFL (Asia) Pte Ltd INFOLINE LTD.) Mar 09 SOURCES OF FUNDS Owner's Fund ' Mar 08 ' Mar ' 07 Mar 06 ' Mar ' 05 .

1 8 45.10 1.94 27.68 36.1 9 44.00 171.00 53.31 915.52 0.42 0.89 .78 0.10 59.83 31.37 0.13 57.00 Investments 869.00 235.71 0.10 4.00 1.89 255.87 0.37 0.42 0.00 40.68 0.00 5.27 370.68 11.75 0.25 40.31 0.23 3.00 3.32 0.17 4.71 0.50 80.00 1.00 130.73 4.180.76 0.180.1 9 446.16 778.4 0 0.74 1.00 100.00 255.20 53.75 16.98 0.00 35.7 1 179.75 701. Loans & Advances Less : Current Liabilities & Provisions Total Net Current Assets Miscellaneous expenses not written Total Note : Book Value of Unquoted Investments Market Value of Quoted Investments 869.00 20.62 0.049.00 370.Equity Share Capital Share Application Money Preference Share Capital Reserves & Surplus Loan Funds Secured Loans Unsecured Loans Total 56.31 Net Current Assets Current Assets.00 932.25 0.1 2 295.31 77.10 0.5 5 0.51 98.60 200.5 7 150.24 0.00 8.43 0.20 0.47 0.68 171.75 50.38 48.7 2 1.77 0.89 USES OF FUNDS Fixed Assets Gross Block Less : Revaluation Reserve Less : Accumulated Depreciation Net Block Capital Work-in-progress 143.00 915.00 44.91 4.9 8 0.38 671.70 0.4 5 100.08 63.70 1.03 12.00 4.9 8 872.68 0.57 1.00 24.00 980.00 123.94 98.49 73.97 151.00 0.049.

Contingent liabilities Number of Equity shares outstanding (in Lacs) 13.85(:INDIAINFO 1.834.22 Vision Our vision is to be the most respected company in the financial services space.50 316. Key features ➢ Membership on the Bombay Stock Exchange Limited and the National Stock Exchange ➢ Registered with the NSDL as well as CDSL as a depository participant.com ➢ Presence across 19 states through a 177 strong branch network.01 3.03 8.0 0 8. online as well as offline under the brand of 5paisa. CAPITAL STRUCTURE OF INDIA INFOLINE Face Value/M Lot Business Industry Group:Finance – General :Not : 200/1 Applicable BSE Code :532636 P/E Code LTP (Rs.6 7 73.43Cr ISIN No.00 501. :INE530601024 .) NSERatio :17. providing a one-stop solution for clients trading in the equities market ➢ Broking services in cash and derivative segments.00 451.81 :94.24 2.000 online registered users ➢ Provision of free and world-class research to all clients.00 571.40%)[NSE] Market Cap :2707. with 75.

05 51844547 182501 18. which was hitherto restricted only to the institutions.00 No.00 PRODUCT& SERVICES Equity India Infoline provided the prospect of researched investing to its clients.29 53516738 111360070 18.72 33.72 0. Of Shares % Holding No. Research for the retail investor did not exist .29 0.88 39.72 NON PROMOTER’S HOLDING Institutional investors Mutual Funds and UTI 61949895 21.12 57690332 153000 20.64 39.36 0.75 95551532 95551532 33.00 2.75 33. And 329055 Insurance FII’s Sub Total 49772811 112051761 17. Of Shares % Holding No.00 2. Of Shares % Holding PROMOTER’S HOLDING Indian Promoters Sub Total 95674407 95674407 33. Inst.54 33.29 58490452 110517500 20.06 Banks Fin.45 39.54 9565553 9565553 33.Share Holding Pattern as on: 31/03/2010 31/12/2009 30/09/200 Face Value 2.

Technology: The Company provides a prudent mix of proprietary and outsourced technologies. India Infoline sharpened its competitive edge through the following initiatives Multi-channel delivery model: The Company is among the few financial intermediaries in India to offer a complement of online and offline broking. Content: The Company has leveraged its research capability to provide regular updates and investment picks across the short and long-term. . Membership: The Company widened client reach in trading on the domestic and international exchanges. Over the last five years. The Companies network of branches also allows customers to place orders on phone or visit our branches for trading. India Infoline leveraged technology to bring the convenience of trading to the investor’s location of preference (residence or office) through computerized access. India Infoline made it possible for clients to view transaction costs and ledger updates in real time. Integrated middle and back office: The customer can trade on the BSE and NSE. Multiple-trading options : The Company harnessed technology to offer services at among the lowest rates in the business. in the cash as well as the derivatives segment all through the available multiple options of Internet. which facilitate business growth without a corresponding increase in costs. phone or branch presence.prior to India Infoline.

02 bn. The commodities market has several products with different and noncorrelated cycles. emails and Internet.advice to execution solution facilitated by information and advice on likely commodity trends in the Indian and international environment. Its experience in securities broking has empowered it with requisite skills and technologies.messenger chat for instant query resolution. Increased offering: The Companies commodities business provides a contra-cyclical alternative to equities broking. The Company was among the first to offer the facility of commodities trading in India’s young commodities market (the MCX commenced operations only in 2003). Commodities India Infoline extension into commodities trading reconciles its strategic intent to emerge as a one stop solutions financial intermediary. On the whole. . The Companies customer service executives proactively contact customers to inform them of key changes and initiatives taken by the Company. the business is fairly insulated against cyclical gyrations in the business. India Infoline distinguished its business through the interplay of knowledge and technology: Complete solution: The Company provides a complete . Business World rated the Companies customer service as Best in their survey of online trading sites carried out in December 2003.Service: Clients can access the customer service team through various media like toll-free lines.34 bn to Rs 20. Average monthly turnover on the commodity exchanges increased from Rs 0.

Direct and Affiliate channels. Rates: The Company harnessed technology to offer services at among the lowest rates in the business. translating into an attractive opportunity to cross-sell products and generate referral business. To ensure maximum reach to customers across India.Technology: The Company has extended the trading terminal to the investors home/workplace reinforced with real-time commodity information and ledger position. Following the opening of the sector in 1999-2000. India Infoline sharpened its competitive edge in this business segment through the following initiatives: Client base: Grew its 40. Insurance An entry into this segment helped complete the client's product basket. Distribution network: Invested in a distribution network of 177 branches across 19 states. The Company’s entry into the insurance sector de risked the Company from a predominant dependence on broking and equity-linked revenues.000 strong client base through knowledge-led analysis. concurrently. a number of private sector insurance service providers commenced operations aggressively and helped grow the market. it graduated the Company into a one stop retail financial solutions provider. which provide it with an unmatched reach within its segment . Membership: The Company widened client reach in trading on the domestic and international exchanges. we have employed a multi pronged approach and reach out to customers via our Network. Over the last five years. The annuity based income generated from insurance intermediation result in solid core revenues across the tenure of the policy.

Research and advice: Provided clients with advice on diverse investment products based on the customer’s existing and prospective financial profile.Hands-on training: Invested aggressively in training its field force more than 100 hours a year in product attributes across the insurance sector .highlighting various product details and marketing skills apart from regular meets where best practices are shared. Our Financial Advisor will analyze: • • • • Your cash-flow requirements Your risk appetite Desired investment horizon Long-term goals Asset Management India Infoline is a leading pan-India mutual fund distribution house associated with leading asset management companies. Technology: The Company provides a prudent mix of proprietary and outsourced technologies.The IIFL Private Wealth Management Team of financial experts will recommend an appropriate financial strategy to effectively meet your investment requirements. It has received . Wealth Management The key to achieving a successful Investment Portfolio is to have a carefully planned financial strategy based on a thorough understanding of the client's investment needs and risk appetite. which facilitate business growth without a corresponding increase in costs. It operates primarily in the retail segment leveraging its existing distribution network to reach prospective clients.

unless the markets are really choppy coupled with a brief on the global markets and any other cues. Delivery. ➢ Support & Resistance Level for Nifty (Pre-market) ➢ Current level of NIFTY & SENSEX. IIFL Capital aims to offer India-focused equity products. Future & Option and BTST Tips) ➢ Investment Ideas. which could impact the market. The subscriber of Daily Market Strategy even . Also. ➢ Latest Company Results. The group recently commenced its offshore asset management business under the ‘IIFL Capital’ brand. Asian. ➢ Real Time Trading Tips (Inclusive Intra-day. ➢ Global Market Updates (US. With offices in New York. Singapore and Dubai. News Letters News letter include the Daily Market Strategy which is morning dose on the health of the markets. ➢ Market Sensitive News. IIFL Inc received an FII license. Crude Oil price. IIFL Securities Pte Ltd received approval from the Monetary Authority of Singapore to carry out global asset management operations. European). Occasionally an investment idea from the research team and a crisp round up of the previous day's top stories. thereby facilitating the investment of dedicated funds in India. asset management and investment banking services. Stock SMS Services Daily market updates and stock ideas on your mobile through SMS (5 messages per day).the in-principle approval to set up a mutual fund. The Singapore arm can now offer broking. That's not all. Five intra-day ideas. fund management and advisory services for offshore and domestic wealth management customers.

gets research reports of India Infoline research team on a priority basis. The India Infoline Weekly Newsletter is flashback for the week gone by. A weekly outlook coupled with the best of the web stories from India Infoline and links to important investment ideas, Leader Speak and features is delivered in your inbox every Friday evening.

Top 10 broking firms
1. ICICI direct.com 2. India Infoline 3. Kotak Securities Ltd.

4. India Bulls
5. Share Khan 6. Motilal Oswal 7. Angel Broking 8. Reliance Money

9. HDFC Securities 10. SMC Global

ICICI Securities Ltd is the largest equity house in the country providing end-to-end solutions (including web-based services) through the largest non-banking distribution channel so as to fulfil all the diverse needs of retail and corporate customers. ICICI Securities (I-Sec) has a dominant position in its core segments of its operations - Corporate Finance including Equity Capital Markets Advisory Services, Institutional Equities, Retail and Financial Product distribution. With a full-service portfolio, a roster of blue-chip clients and performance second to none, we have a formidable reputation within the industry. Today ICICI Securities is among the leading Financial Institutions both on the institutional as well as retail side. Headquarter, in Mumbai I-Sec operates out of several locations in India. ICICI Securities Inc., the step-down wholly owned US subsidiary of the company is a member of the Financial Regulatory Authority (FINRA). ICICI Securities Inc. activities include Dealing in Securities and Corporate Advisory Services in the United States. ICICI Securities Inc. is also registered with the Monetary Authority of Singapore (MAS) and operates a branch office in Singapore. ICICI Securities limited has its presence in the following networks Mumbai, New Delhi., Singapore, and Oman.

Kotak Securities Ltd., a 100 % subsidiary of Kotak Mahindra Bank, is one of the oldest and largest stock brokers in the industry.Its offerings include stock broking services for stock trading through the branch and Internet, Investments in IPO, Mutual funds and Portfolio management services. Kotak has been the first in providing many products and services which have now become industry standards. Some of them are:
• • • •

• •

Facility of Margin Finance to the customers for online stock trading Investing in IPOs and Mutual Funds on the phone SMS alerts before execution of depository transactions Mobile application to track portfolio of your investments in stock market /td> Auto Invest - A systematic investing plan in Equities and Mutual funds. Provision of margin against securities automatically against shares in your Demat account

Kotak network spans over 400 cities with 1113 outlets.

Indiabulls is India’s leading retail financial services company with 77 location spread across 64 cities Its size and strong balance sheet allows providing varied products and services at very attractive prices, Indiabulls over 750 Client Relationship Managers are dedicated to serving your unique needs Indiabulls is lead by a highly regarded management team that has invested Corers of rupees into a world class infrastructure that provides real-time services & 24/7 access to all information and products. The Indiabulls Professional network offers realtime prices. Detailed data and news intelligent analytics and electronic trading capabilities right at your finger-tips. This powerful technology is complemented by our knowledgeable and customer focused Relationship managers. Inidabulls offers a full range of financial services and products ranging from Equities, Derivatives. Demat services and insurance to enhance wealth and to achieve the financial goals.


Portfolio Management Services.. Angel is also registered as a Depository Participant with CDSL. Angel Commodities Broking Ltd. The Angel Group is a member of the Bombay Stock Exchange (BSE). Commodities. Life Insurance. RELIANCE SECURITIES Reliance Securities Limited is a Reliance Capital company and part of the Reliance Anil Dhirubhai Ambani Group. Angel has emerged as one of the most respected Stock-Broking and Wealth Management Companies in India. At present Angel group includes: Angel Broking ltd. including Call & Trade. Reliance Securities with the permission of Reliance Capital Limited uses the “Reliance Money” brand to market its various services. Depository Services. portfolio Management Services. Reliance Capital is one of India's leading and fastest growing private sector financial services companies. . Mutual Funds & IPOs. Branch dealing Desk and its network of affiliates Reliance Money through its pan India presence with 6. Mutual Funds. and Investment Advisory. It also offers secured online share trading platform and investment activities in secure. .233 outlets has more than 3. Main business of Angel is Equity Trading. and ranks among the top 3 private sector financial services and banking groups. “Reliance Money” is a brand owned by Reliance Capital Limited. Reliance Securities endeavors to change the way investors transact in equities markets and avails services. Today.ANGEL BROKING Angel Broking's tryst with excellence in customer relations began in 1987. With its unique retail-focused stock trading business model. Investment Banking. cost effective and convenient manner. It provides customers with access to Equity. Personal Loans. Angel is committed to providing ‘Real Value for Money’ to all its clients. To enable wider participation. it also provides the convenience of trading offline through variety of means.5 million customers. National Stock Exchange (NSE) and the two leading Commodity Exchanges in the country: NCDEX & MCX. Angel Securities ltd. IPO. Derivatives.

banks and other financial institutions. which regulates the operations of stock exchanges. reflecting the performance of the country’s economic state of health. In addition the international trading and investment exposure has made it imperative to better operational efficiency. constant efforts are being made and to a certain extent improvements have been made. It is exposed to a high degree of volatility. The past performances in the capital markets especially the securities scam by ‘Hasrshad Mehta’ has led to tightening of the operations by SEBI. With the view to improve. prices fluctuate within minutes and are determined by the demand and supply of stocks at a given time. 1  HISTORY  HISTORY OF THE STOCK BROKING INDUSTRY . Stock brokers are the ones who buys and sells securities on behalf of individuals and institutions for some commission. discipline and bring greater transparency in this sector.interims of net worth. Stock market is a place where securities are bought and sold. The Securities and Exchange Board of India (SEBI) is the authorized body.  INDUSTRY OVERVIEW  INTRODUCTION Stock exchanges to some extent play an important role as indicators.

the "Native Share and Stock Brokers' Association" (which is alternatively known as "The Stock Exchange"). there were only half a dozen brokers recognized by banks and merchants during 1840 and 1850. the 'Share Mania' in India begun. Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. Thus in the same way. a disastrous slump began (for example. 2  DEVELOPMENT  An important early event in the development of the stock market in India was the formation of the Native Share and Stock Brokers’ Association at Bombay in 1875. thus. in 1865. In 1860-61 the American Civil War broke out and cotton supply from United States of Europe was stopped. found a place in a street (now appropriately called as Dalal Street) where they would conveniently assemble and transact business. However. At the end of the American Civil War. . 87). the brokers who thrived out of Civil War in 1874. Though the trading list was broader in 1839. By 1830's business on corporate stocks and shares in Bank and Cotton presses took place in Bombay. The earliest records of security dealings in India are meager and obscure. Thus. they formally established in Bombay. gradually with the passage of time number of exchanges were increased and at currently it reached to the figure of 24 stock exchanges. at the end of the American Civil War. In 1887. the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. In 1895. Its history dates back to nearly 200 years ago. the Stock Exchange at Bombay was consolidated. The 1850's witnessed a rapid development of commercial enterprise and brokerage business attracted many men into the field and by 1860 the number of brokers increased into 60. The number of brokers increased to about 200 to 250.Indian Stock Markets are one of the oldest in Asia.

suspension. As of January 2002 there were 23 stock exchanges recognized by the central Government. Mumbai (The Inter-connected Stock Exchange of India). Chenni. Pune.the precursor of the present-day Bombay Stock Exchange. They are located at Ahemdabad.(the Madras stock Exchanges ). Mangalore. Bangalore. and Rajkot. This was followed by the formation of associations /exchanges in Ahmedabad (1894). Baroda. varied or rescinded only with the prior approval of the government. The rules of a recognized stock exchanges relating to the managerial powers of the governing body. so on and so forth have to be approved by the government. Of course. the central government introduced a legislation called the Securities Contracts (Regulation) Act. Under this legislation. it is mandatory on the part of a stock exchanges to seek government recognition. Delhi. IN addition. Bhubaneshwar. Hyderbad. and Madras (1937). While the recognized stock exchanges have been accorded a privileged position. they are subject to governmental supervision and control. the principle bourses are the National Stock Exchange and The Bombay Stock Exchange . Mumbai (OTC Exchange of India). and re-admission of its members. Calcutta. These rules can be amended. accounting for the bulk of the business done on the Indian stock market. appointment of authorized representatives and clerks. 3 . Mumbai(the National Stock Exchange or NSE). Coimbatore. Kanpur. Calcutta (1908). a large number of ephemeral exchanges emerged mainly in buoyant periods to recede into oblivion during depressing times subsequently. expulsion. Guwahati. Patna. admission. Ludhiana. 1956. Mumbai (The Stock Exchange). Indore. Jaipur. papularly called the Bombay Stock Exchange. Cochin. In order to check such aberrations and promote a more orderly development of the stock market.

who are from the broking community (one third of them retire ever year by rotation). It has evolved over the years into its present status as the premier Stock Exchange in the country. three SEBI nominees. It is the oldest one in Asia. B S E ( B O M B A Y S T O C K E X C H A N G E ) The Stock Exchange.brokers. of India under the Securities Contracts (Regulation) Act. even older than the Tokyo Stock Exchange. It is the first Stock Exchange in the Country to have obtained permanent recognition in 1956 from the Govt. debt and derivatives upholds the interests of the investors and ensures redressal of their grievances whether against the companies or its own member. The Governing Board consists of 9 elected directors. which decides the policies and regulates the affairs of the Exchange. Mumbai. six public representatives and an Executive Director & Chief Executive Officer and a Chief Operating Officer. 1956. It also strives to educate and enlighten the investors by conducting investor education program and making available to them necessary informative inputs. popularly known as"BSE" was established in 1875 as "The Native Share and Stock Brokers Association". It is a voluntary non-profit making Association of Persons (AOP) and is currently engaged in the process of converting itself into demutualised and corporate entity. 4 . The Exchange. A Governing Board having 20 directors is the apex body. while providing an efficient and transparent market for trading in securities. which was established in 1878.

screen-based. It has been playing a leading role as a change agent in transforming the Indian Capital Markets to its present form. technology. Within a very short span of time. It started operations in June 1994. with a high degree of transparency and equal access to investors irrespective of geographical location. technology and service standards have become industry benchmarks and are being replicated by other market participants. The high level of information dissemination through on-line system has helped in integrating retail investors on a nation-wide basis. NSE has been able to achieve all the objectives for which it was set up. infrastructure. clearing and settlement and investor service. Products . risk management. The standards set by the exchange in terms of market practices. The Indian Capital Markets are a far cry from what they used to be a decade ago in terms of market practices. N S E ( N A T I O N A L S T O C K E X C H A N G E ) NSE was incorporated in 1992 and was given recognition as a stock exchange in April 1993. The technology has been harnessed to deliver the services to the investors across the country at the cheapest possible cost. with trading on the Wholesale Debt Market Segment. 5 . It provides a nation-wide. NSE has been able to take the stock market to the doorsteps of the investors. Subsequently it launched the Capital Market Segment in November 1994 as a trading platform for equities and the Futures and Options Segment in June 2000 for various derivative instruments. automated trading system.

c o n s t r u c t e d the current national institutes the exchange has been established with the .  N C D E X m e d i a  N C D E X c o m m o d i t y t h e b a s i s i s o n e o f t h e g i v e s o f t h e t r a d i t i o n a l o n l i n e I n d i a n o n w h i c h i s o f o n e i n f o r m a t i o n e x c h a n g e . private and easy services. This exchange provides their trading and clearing member at different 130 centers for contract. 2003. In commodity market the main participants are speculators. Promoters of NCDEX are  N a t i o n a l  I C I C I  L i f e R u r a l S t o c k E x c h a n g e ( N S E ) C o r p o r a t i o n ( L I C ) f o r A g r i c u l t u r a l ( N A B A R D ) ( P N B ) a n d b a n k I n s u r a n c e B a n k  N a t i o n a l  I F F I C O  P u n j a b  C R I S I L WHY NCDEX?  N C D E X b a s e d D e v e l o p m e n t N a t i o n a l B a n k i s s y s t e m n a t i o n a l i z e d w h i c h i s s c r e e n p r o v i d i n g t r a n s p a r e n t . hedgers and arbitrageurs. N C D E X C O M M O D I T I E S D E R I V A T I V E S facilities to ( N A T I O N A L A N D E X C H A N G E ) NCDEX started working on 15th December.

w i t h i n d u s t r i a l c o m p a n i e s . p a r t n e r s . NSI etc…. i n d u s t r i a l a h a s o f d e v e l o p e d c o m m o d i t y f a c i l i t y a n d f o r a l s o a p p o i n t e d c h e c k i n g banks and developers of kiosk network NCDEX is able to provide current rates and contracts rate.  I n I n d i a h a s N C D E X g u a r a n t e e q u a l i t y h a s f u n d . LIC. 6 . t w o t h e e x p o r t s t i m e o f a t m a x i m u m s e t t l e m e n t  N C D E X f o r d e l i v e r y FACILITIES PROVIDED BY NCDEX  N C D E X c h e c k i n g p r o v i d e s wear house facility  B y n e w s c o l l a b o r a t i n g a g e n c i e s .coloration of leading institutes like NABARD.


 T o p r e p a r e g u i d e l i n e s o f r e l a t e d t o s p e c i a l N C D E X works with bank.  T o p r o d u c t s s e c u r i t i z a t i o n a v a i l f a r m e r s i n f r o m p r i c e s r i s k o f f l u c t u a t i o n p r o v i d e s  N C D E X t o m a k e a n d s a l e s services for agricultural. i s N C D E X s p e c i a l w o r k i n g c l e a r w i t h t a x o f f i c e r o f d i f f e r e n t t y p e s .

wealth advisory. SMC has entered into a 50:50 joint venture with Sanlam Group. SMC has expanded its domestic as well as international operations. Switzerland. and has established office in Dubai. Over the Years. investment banking. derivatives. depository services. with a pan-India presence. Portfolio management. SMC has plans to grow its network to 5. Australia and others. Dublin. Sanlam is operating in over 30 countries globally UK. IPOs and mutual funds distribution. insurance broking. a leading financial services provider in India is a vertically integrated investment solutions company. one of the largest listed financial services group in South Africa for setting up wealth Management and Asset including Management business in India. Ahmadabad. commodity. Jaipur and Hyderabad plus a growing network of more than 2000 offices across over 425 cities/towns in India. . clearing services. Existing network includes regional offices at Mumbai. Kolkata. Its products and Services include Institutional and retail brokerage of equity. currency. The company has expanded internationally. Luxembourg. margin funding and research. Cochin. USA.  N C D E X p r o d u c t s 7 SMC i s l i k e p r o v i d i n g “ w e a t h e r a t t r a c t i v e d e r i v a t i v e s ” SMC Group. Chennai. Bangalore.500 offices across 700+ cities in the next 3 years.service taxes. online trading .

 COMPETITORS   The company is facing the competition from local as well as national level players.  POTENTIAL ENTRANTS   p l e i I a T h e o t e n t v t r . e a l s t n i t i a n n n r t s k e m . M o t i l a l O s w a l .  T h e r e a r e a l s o o t h e r b i g n a m e s l i k e I n d i a b u l l s .com. The local players provide facility for off-line trading while the national players like and HDFC ICICIdirect.com Kotakstreet. Security provide online trading services. 5 p a i s a a n d Marwadi encircles the company form both the sides by providing online and off-line trading with competitive services.

g. E. i n s c e . s t s r a s t u m a l t i t n h t h o m e u e f r u . Bank Of Baroda. m u t f u n a r e s u b t e s  I f u s e t h i i n s e n t  s r t e h t r u s c h d t e e e s i a t r m b d i u e e a t n t r s e k u u d s .  N a t i o n a l i z e d b a n k s a r e a l s o t h i n k i n g t o e n t e r i n t h i s f i e l d b y t y i n g u p w i t h broking houses.  SUBSTITUES  H e s u b t e s s u c i n s e n t w h i c a n u s e i n s o f i n v g in shares.J e o j i t a n d C i p h e r w h i c h a r e c o m i n g in near future to Rajkot City.  T h i n s e n t l i k B a n F D .

i n c r t h i s m a y d i s a n t a g f o r s t o c broking houses.  e d e k a v t s b a h e e e The companies and banks which are having these instruments can plunge into this industry. 20  ENTRY BARRIERS   c H a p u i g e t a l : C a p i t a l i s n e c e s s a r y n o t o n l y f o r f i x e d .

one needs huge capital for technology up gradation and skilled manpower.  Technology T e c h n o l g y f s t o c k b r o k i n g h o u s e s l i f e s a v i n g d e v i c e . and regulators . NSDL. background Thus. It should comply with the regulation of the governing bodies like SEBI. To start a stock broking house. it needs to have some kind of financial expertise. Thus.f a c i l s a l s o customer’s i f t o b i r e u t and credit absorbing start up losses. etc. :- o o i r s Stock broking requires huge capital to make their products user friendly. technology could be one of the entry barriers.  Regulatory Constraints :Obtaining a license is a tedious job for a stock broking house. which in turn requires capital to employ skilled manpower. For a stock broking houses to plunge into the stock broking industry.

 E x n c : e p e r i e c u r v e c c c t i i s o r o m y h i n d s e r e p s u v s i e t c t T e r h e n i n e y h e s t which are provided to the endusers and the research based activities which includes “TIPS”.  Network :. which say that.constraints could be an entry barrier. Marwadi).”Network can come up as . It will take time for a new entrant to establish such a huge network (e.g. Also the most important thing which helps already established firms is-“TRUST” which people would be having on firms like SSKI . fundamental as well as technical script analysis.The “Reach” to the customer is the key factor in the industry. and ICICI is very efficient and spreaded all over India. etc. this is very difficult for new companies to imitate. The network of the companies like Motilal Oswal. Motilal Oswal. Sharekhan.

which .Whenever a new player comes in the industry.g. This kind of practice is called expected Retaliation which is also possible in this industry in terms of less brokerage rates and reduced account opening charges. Sharekhan was having two 21 types of accounts viz. the old companies have an option to reduce the prices of their product. E. before the entry of so many mew companies.”  Expected Retaliation :.most difficult entry barrier to overcome. speed trade speed trade plus.

45 500 Per 25 Annum Month NO YES Per 450 Per 350 Per 400 Per Annum Annum Annum NO NO NO LIFE TIME FREE DEMAT FACILITY AGAINST RS.45 YES .06 .30 YES .03 .05 .05 . they have come up with only one account i.were costing 1000 & 1500 account opening But charges due to respectively. competition.e.05 .1000.555 MARGIN FUNDING EXPOUSER AGAINST NO NIL YES 10 Times YES 5 Times NO 4 Times NO 4 Times NO 5 Times .75 YES . COMPETITIVE ANALYSIS ICICI DIRECT A/C OPENING FEE INDIA INFOLINE** KOTAK SECURITIES SHAREKHAN MOTILAL OSWAL INDIABULLS 750 750* 750 550 550 500 SOFTWARE FACILITY BROKRAGE INTRADAY BROKRAGE DELIVERY AMC CHARGES NO . speed trade plus with the account charges of Rs.075 .59 Per 360 Annum NO YES .50 YES .

RESEARCH METHODOLOGY TITLE— To determine role of share market in indian economy . ➢ To know the role of the share market in Indian economy.2010. Secondary Objective ➢ To find the potential Customer for India Infoline. DURATION OF THE PROJECT— The project had been done for 45 days as per the University Schedule between 18th June. OBJECTIVE – Primary Objective ➢ To determine reasons behind opting for investment in share market.2010 and 1st August. will also be studied. **Awarded as best broking firm in India as per Finance Asia and Asia Money .CASH/STOCK NOTE *Rs. . ➢ To provide the company with information of customer's preferences for broking house if they have any and reasons for opting for that particular broking firm. Satisfaction levels etc. 750 is refundable in 90 days against brokerage. Age groups. The study deals mainly with studying the buying pattern in the insurance industry with a special focus on HDFC Standard Life Insurance.. The various segments of the markets dividend in terms of Insurance Needs.

➢ To create awareness among retail investors regarding Share Market & Mutual Funds. a rough draft was prepared keeping in mind the objective of the research. ➢ To find out the current market scenario of Share Market ➢ To introduce the prospective investor to the various scheme & assist him/her according to his/her respective requirements. Descriptive Research : a) Survey Method b) Telephone Interviewing c) Questionnaire Method SAMPLING METHODOLOGY Sampling Technique: Initially. Conclusive Research C. ➢ To create specified segments in the market about Share Market. ➢ To build as many as relationships with the various investors who are in need of such schemes. Exploratory Research : a) Search of secondary data b) Survey of respondents selected B. TYPE OF RESEARCH A. A pilot study was done in order to know the accuracy of the Questionnaire. The final Questionnaire was arrived only after certain important changes were done. Thus my sampling came out to be judgmental and convenient Sampling Unit: .

LIMITATIONS OF THE RESEARCH 1) The research is confined to a certain parts of Jaipur (Rajasthan) and does not necessarily shows a pattern applicable to all part of the Country. The study also show the trends in the share market which will not only the single broking firm but to the whole industry. This data can be extrapolated to take in the trends across the industry. These comprise of employees of MNCs. which comprised of mainly peoples from different regions of Jaipur due to time constraints. professionals. Sampling Area: The area of the research was Jaipur. It will show how the consumer changes his mind for investment in share market due convincing of brokers and brokering firms. The significance for the industry lies in studying these trends that emerge from the study. Sample size: The sample size was restricted to only 200. A study like this can attempt to guide the future of the industry based on current trends.. It will not only help in knowing consumer’s perception about the share market but also help in knowing the threat that an economy can have with rise and depression in share market. SCOPE OF THE STUDY The study deals with the studying of role of share market in indian economy. businessmen. govt. INDIA. employees & private employees etc. SIGNIFICANCE OF THE STUDY This is a limited study which takes into consideration the responses of 200 people. People are only beginning to wake up to its vast possibilities. . It is a rapidly changing and evolving sector. Rajasthan.The respondents who were asked to fill out questionnaires are the sampling units.

6. The employees working in are satisfied with their jobs as well as treatment of the superior organizational members and regular training & development are being imparted to them to make alive to present circumstances. The share market offering its best services and opportunities in every sphere. Employees are loyal towards the organization resulting enriched and considerable working experience. 4. 5) Some of the respondents were hesitant and unwilling to give response. The Stock Exchange provides companies with the facility to raise capital for expansion through selling shares to the investing public. by maintaining their healthier working experience many of them have been promoted by their hard work and creative expertise. 5. 7. When people draw their savings and invest in shares. 3. 3) Lack of interest. The management control over the lower management and supervisory section is medium and not high because of the fact employees are enough to handle their tasks and responsibilities fairly and honestly. FACTS AND FINDINGS Following are the facts and findings that are being perceived by me while doing project at India Infoline: 1. Despite being simply graduated. analysis on one day or in one segment can change very quickly. The environmental changes are vital to be considered in order to assimilate the findings. it leads to a more rational allocation of resources. The Daily reporting to the Superior by the corresponding subordinate employee so maintained so as to judge the comparative performance of the particular day. 2. . 4) Time proved to be a major constraint as far as collection and analysis of data was concerned.2) In a rapidly changing industry. 8.

5% 100% ➢ Interpretation. The movement of share prices and in general of the stock indexes can be an indicator of the general trend in the economy.9. OF RESPONDENT 25 50 100 25 200 PERCENTAGE 12. Data showing whether the share market plays role in Indian economy or not? . As opposed to other businesses that require huge capital outlay. 11. investing in shares is open to both the large and small stock investors because a person buys the number of shares they can afford 10.5% 25% 50% 12. ANALYSIS AND INERPRETATION Data showing number of respondent and their experience of investing in the share market EXPERIENCE Less than 1 year Between 1-3 year Between 4-6 year More than 6 years NO.So from the above data we can say that most of the respondent in my study are those people who have a very good experience of investing in share market for a long time. Governments at various levels may decide to borrow money in order to finance infrastructure projects such as sewage and water treatment works or housing estates by selling another category of securities known as bonds.

of respondent 175 25 percentage 87.5% 12.5% ➢ Interpretation.The data shows that most of the respondent feels that share market plays a big role in Indian economy Data showing view of the respondent whether ups and downs in share market affect the Indian economy or not? View Yes No No. of respondent 150 50 percentage 75% 25% .View Yes No No.

Data showing the reach of share market knowledge to the common man. Data showing preferences of respondents for the trading Preferences Intraday Delivery Both No.5% 25% ➢ Interpretation. of respondent 75 125 50 percentage 37. View No.➢ Interpretation. of respondent percentage .About 75% of our respondent has a view that ups and downs in share market affect the economy and rest do not think so.125 out of total respondent feels delivery trading as the best option for trading in the stock market and 75 votes for intraday trading and about 50 of them says that they don’t have difficulty in using any of them or both of them.5% 62.

of respondent 50 75 50 25 percentage 25% 37. Data showing the different attributes that the client look forward in the brokerage firm Attributes Brand name Low Brokerage Management team Track Record No.Satisfied Not-Satisfied 125 75 62.5% 25% 12.5% 37.About 62% of the respondent feels that the knowledge of common man about the share market is satisfactory and rest feels that the knowledge is not satidfactory.5% ➢ Interpretation.5% .

About 75 respondent got attracted to that brokerage firm which have low brokerage rate and 50-50 respondent get attracted due to good management team and brand name.➢ Interpretation.5% of the respondents are satisfies from the services that are being offered by the broking firms and rest of them says that they are unsatisfied and firms have to do a lot to attract the customers. of respondent 125 75 percentage 62.5% 37. Data showing the view of respondent about the share market View Place of investment Place of getting high gain A good source of income No. View Satisfied Not-Satisfied No.5% 25% .62.5% ➢ Interpretation. But 25 respondent gets attracted after seeing the success story of the firm Data showing whether the respondents are satisfied from the services of brokering firms. of respondent 50 75 50 percentage 25% 37.

Most of the respondent feels that share market is the place of getting high gain. .5% ➢ Interpretation. View Satisfied Not-Satisfied No. About 50 respondent feels that it is a place of just an investment and 50 says that it is a good source of income. of respondent 150 50 percentage 75% 25% ➢ Interpretation. About 25 respondent is in favour of choosing it as an career option.150 respondent are being satisfied from the investment tips of the broking firm and rest are unsatisfied. Data showing whether the respondents are satisfied from the investment tips of brokering firms.A good career 25 12.

View Security of funds Good return Technological advancement Additional services No. Rest of the respondent gives emphasis on the additional services that the firm provides. of respondent 50 75 50 25 percentage 25%% 37.5% 25% 12.com” and ➢ “5paisa.When asked about why they choose the stated company.com” have developed into Brands ➢ Quality work force ➢ All India presence ➢ Well-known Brand name .India distribution network ➢ “India Infoline. most of them vote for earning good return and about equal respondent votes for security of funds and technological advancement that the company provides. SWOT ANALYSIS STRENGTH— ➢ “One Stop” shop ➢ Pan .5% Data showing the reasons of respondents for operating with the stated company. Interpretation.

OPPURTUNITY— ➢ Changing demographics with higher disposable income and increasingly complex financial instruments will drive demand for investment advisory services ➢ Rapid penetration of Internet and computers means that technology enabled financial services will gain market share ➢ Untapped Market ➢ Growing Economy ➢ Dissatisfaction from competitors THREATS— ➢ Economic slowdown ➢ Volatile movement in indices and events like May 17.➢ ISO 9002 Certification ➢ Got the best broking house award in year 2004 ➢ Integrated technology platform WEAKNESS— ➢ Lack of a banking arm to complete the bank-broker-depository chain. ➢ Technical up gradation. ➢ Lack of Advertisements. 2008 ➢ Stock markets falls will have a cascading effect on our mutual fund mobilization ➢ Increase/decrease in interest rates can affect our debt/ income fund mobilizations ➢ Future changes in personal taxation rules can impact insurance sales . ➢ Categorization of Customers. 2004 and January 21. ➢ High attrition rate ➢ Lack of awareness among customers.

During these three months we have meet to different people. I have prepared the questionnaire that has helped us to know the market trends and customer preference related to Demat a/c and commodity section. They want to open Demat account and take advantage of online and offline share trading. This project has given us real practical experience of the market. I have assessed their queries and grievances. We have also learnt about how to deal with customers and solve their queries and how to convince them by the presenting the products of the company.➢ Increasing competition from large and particularly foreign players ➢ Volatile Market CONCLUSION After taking feedback from customers I knew that India Infoline is popular product in the market and everyone knows the benefits of online share trading. .

➢ Existing Employees must be given training.I think that performance can be improved by the adopting some strategy of the marketing like and know the customer satisfaction related to our company products. providing liquidity for the investors and monitoring and disciplining company management are the principal functions of the share markets. Stock market has multiple roles in the economy like for ➢ Raising capital for businesses ➢ Mobilizing savings for investment ➢ Facilitating company growth ➢ Corporate governance ➢ Creating investment opportunities for small investors ➢ Government capital-raising for development projects ➢ Barometer of the economy RECOMMENDATIONS AND SUGGESTIONS Since the goodwill of IIFL is not too appreciable. ➢ Emphasize on advertisements through newspapers and television. . So in order to build healthy image the company should focus on marketing area by the way of: ➢ Appointing more relationship managers who can will interact with the customers effectively and help the company to bring in more business ➢ Appealing advertisements ➢ Bringing more efficiency in research department ➢ Number of Employees should be increased. Besides enabling mobilizing resources for investment. The share market has been assigned an important place in financing the Indian corporate sector. directly from the investors.

➢ Focusing on new branch.: Your Trading account is in which company? E-mail: 1) Since when are you trading in the share market? Less than 1 yr 1-3 yrs 4-6 yrs More than 6 yrs . APPENDIX QUESTIONNAIRE Name: Contact no.

.....................10 Paisa more than 0..............................................2) What type of trading do you prefer? Intraday Delivery Both 3) What is the brokerage charged? ........ ........................................................01-...........................03-...............................................30 Paisa .........02-......................3Paisa 4) What interests you in Share Market? …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… ………… 5) How often do you gain from it? …………………………………………………………………………………………………………… … …………………………………………………………………………………………………………… … 6) What are the reasons for operating with the stated company? ……………………………………………………………………………………………............. .......................................................20 Paisa ....... ........................

7) Are you satisfied with the services? Yes No 8) Are you Satisfied with the investment tips? Yes No 9) What is the margin allowed and what are the services that you expect? …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …… 10) Is there any difference in the services provided by local broker and a corporate body? If yes then please specify? …………………………………………………………………………………………………………… … …………………………………………………………………………………………………………… … 11) Have you switched from one firm to another? If yes then reasons and which company have you switched to? …………………………………………………………………………………………………………… … ……………………………………………………………………………………………………………. ...

12) What are the different attributes that the client looks forward for a brokerage house? …………………………………………………………………………………………………………… … …………………………………………………………………………………………………………… … 13) What were the areas where the MOST could not meet the client’s expectation level? Attributes a) Brokerage fees b) Services c) Research & advices d) Complaints handling e) Products Basket Ranks 14) What is your view about the role of share market in Indian economy? …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… ………… 15) Do the ups and downs in share market effects the economy? Yes No 16) Is common man knows about the share market? Yes No .

17) What should be done to increase the stability in share market? …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… ……… Remarks:…………………………………………………………………………………………………………… …………………………………………………………………………………………………………… …………………………………………………………………………………………………………… ……. (Signature of Respondent ) .

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