ACROPOLIS FACULTY OF MANAGEMENT & RESEARCH

SYNOPSIS FOR THE MAJOR PROJECT REPORT

On

“ANALYSIS OF DIFFERENT FINANCIAL PRODUCTS”

At

Submitted To Submitted By

Prof. Naman Shrivastav Aparna jain

MBA 3rd Sem (2016- 2017)

Roll No.52420038

Department Of Management
ACROPOLIS FACULTY OF MANAGEMENT & RESEARCH,
Indore (M.P.)2015-2017

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 CONTENTS

S. No Contents Page No.

1 Introduction 3
2 Company History 4-5
3 Karvy’s Mission & Vision 5-6
4 Objectives 6
5 Achievements 7
6 Karvy Stock Broking Limited 7
7 Karvy Services- An Overview 8
8 Introduction To Stock Market 8-10
9 Stock Exchange 10-11
10 Derivatives in Stock Market 12-14
11 Different Trading Strategies In Stock Market 14
12 Learning 14-16
13 Suggestions 17
14 Conclusion 17

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 INTRODUCTION

“Success is a journey, not a destination.” If we look for examples to prove this quote then we can
find many but there is none like that of KARVY. Back in the year 1981, five people created history
by establishing Karvy and company which is today known as Karvy, the largest financial service
provider of India.

COMPANY OVERVIEW:

Karvy Stock Broking Ltd. is a Premier Integrated Financial Services provider and ranked among
the top 5 in the country in all its business Segment. It services over 16 million individual investors in
various capacities and corporate entities. It is a member of:

1. National Stock Exchange ( NSE )

2. Bombay Stock Exchange ( BSE )

Karvyutilized its experience and superlative expertise to capitalize on its strengths and improve its

service, innovate and provide new ones. It diversified in the process and thus evolved as India’s
premier integrated financial service enterprise.

Karvy has been a customer centric company since its inception. It offers a Single platform servicing
multiple Finance Instruments in its bid to offer complete financial solutions to the varying needs of
both corporate and retail Investors, where an extensive range of services are provided with great
Volume – Management Capability.

Karvy Covers the entire spectrum of financial services such as Stock Broking, Depository
Participants, Distribution of Financial Products like Mutual Funds, Bonds, Fixed deposits, Equities,
Insurance, Commodities Broking, Personal Finance Advisory Services, Merchant Banking &

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Corporate Finance, Placement of Equity, IPO, etc. Karvy has Professional Management Team and
ranks amongst the best in Technology, Operations & Research of various Industrial Segments.

COMPANY HISTORY

The Karvy group was formed in 1983 at Hyderabad, India. Karvy ranks among the top player in
almost all the fields it operates. Karvy Computershare Limited is India’s largest Registrar and
Transfer Agent with a client base of nearly 500 blue chip corporates, managing over 2 crore
accounts.

KARVY – EARLY DAYS:

Karvy the name comes from the names of the Directors:

Mr. Krishna Prasad - K

Mr. Arun - A

Mr. Radha Krishna - R

Mr. Venkat Krishna - V

Mr. Yugadhar - Y

Karvy Stock Brokers Limited, member of National Stock Exchange of India and the Bombay Stock
Exchange, ranks among the top 5 stock brokers in India. With over 6,00,000 active accounts, it ranks
among the top 5 Depositary Participant in India, registered with NSDL and CDSL. KarvyComtrade,
Member of NCDEX and MCX ranks among the top 3 commodity brokers in the country. Registered
with AMFI as a corporate Agent, Karvy is also among the top Mutual Fund mobilizer with over Rs.
5,000 crores under management.

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Karvy Reality Services, which started in 2006, has quickly established itself as a broker who adds
value in the Reality Sector. Karvy Global offers niche off shoring services to the clients in the US.
Karvy has 575 offices over 375 Location across India and overseas at Dubai and New York over
9000 highly qualified people staff.

Karvy was started by a group of five chartered accountants in 1979. The partners decided to offer,
other than the audit services, value added services like corporate advisory services to their clients.
The first firm in the group, Karvy Consultants Limited was incorporated on 23rd July, 1983. In a
very short period, it became the largest Registrar and Transfer Agent in India. This business was
spun off to form a separate joint venture with Computershare of Australia, in 2005.

Karvy’s foray into stock broking began with marketing IPOs, in 1993. Within a few years, Karvy
began topping the IPO procurement league tables and it has consistently maintained its position
among the top 5. Karvy was among the first few members of National Stock Exchange, in 1994 and
became a member of The Stock Exchange, Mumbai in 2001. Dematerialization of shares gathered
pace in mid-90s and Karvy was in the forefront educating investors on the advantages of
dematerializing their shares. Today Karvy is among the top 5 Depositary Participant in India.
While the registry business is a 50:50 Joint Venture with Computershare of Australia, we have equity
participation by ICICI Ventures Limited and Barings Asia Limited, in Karvy Stock Broking Limited.

KARVY’S MISSION AND VISION

Success Sutras of Karvy:

The success story of Karvy is driven by 8 success sutras adopted by it namely trust, integrity,
dedication, commitment, enterprises, hard work and team play, learning and innovation, empathy and
humility. These are the values that bind success with Karvy.

Vision of Karvy:

To achieve & sustain market leadership, Karvy shall aim for complete customer satisfaction, by
combining its human and technological resources, to provide world class quality services. In the
process Karvy shall strive to meet and exceed customer’s satisfaction and set industry standards.

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Mission Statement:

“Our mission is to be a leading and preferred service provider to our customers, and we aim to
achieve this leadership position by building an innovative, enterprising, and technology driven
organization which will set highest standards of service and business ethics.”

OBJECTIVES

The objective of my project include the following:-

1. To study the financial products and services of the Karvy Stock Broking Limited.
2. Comparative analysis of Karvy Stock Broking Ltd with its competitors.

ACHIEVEMENTS

 Among the top 5 stock brokers in India (4% of NSE Volumes)

 India’s no. 1 Registrar & Securities Transfer Agents.

 Among the top 3 Depository Participants.

 Largest Network of Branches & Business Associates.

 Among top 10 Investment Bankers.

 Largest Distributors of Financial Products.

 Adjudged as one of the top 50 IT Uses in India by MIS Asia.

 Full Fledged IT Driven Operations.

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 KARVY STOCK BROKING LIMITED

Karvy Stock Broking Ltd. (KSBL) is a part of the Karvy group of companies, a Hyderabad based
group, promoted by a group of Chartered Accountants. The key promoters are Mr. C. Parthasarathy,
Mr.M.S. Ramakrishna and Mr. M. Yugandhar. In November 2007, ICICI Venture and Baring Asia
PE picked up 31% stake in Karvy Stock Broking Limited (KSBL) by buying the entire 20% equity
held by Pacific Century Group (PCG) and an additional 11% stake in the form of fresh equity. KSBL
is involved in the equity broking business for the group, depository operations, distribution of
financial products, advisory services and providing wealth management solutions to private client
group.

Karvy has always believed in adding value to services it offers to clients. A top-notch research team
based in Mumbai and Hyderabad supports its employees to advise clients on their investment needs.
With the information overload today, Karvy’s team of analysts help investors makes the right calls,
be it equities, mutual funds, insurance. On a typical working day Karvy:

 Has more than 25,000 investors visiting our 575 offices.

 Publishes / broadcasts at least 50 buy / sell calls.
 Attends to 10,000+ telephone calls.
 Mails 25,000 envelopes, containing Annual Reports, dividend cheques/ advises, allotment /
refund advises.
 Executes 150,000+ trades on NSE / BSE.
 Executes 50,000 debit / credit in the depositary accounts Advises 3,000+ clients on the
investments in mutual funds.

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 KARVY SERVICES – AN OVERVIEW

 Stock broking
 Depository services
 Investment product distribution
 Insurance Broking Services
 Mutual fund services
 Portfolio management and advisory services
 Commodities
 Wealth Management
 Institutional Services

INTRODUCTION TO STOCK MARKET

Stock markets refer to a market place where in invertor can buy and sell stocks. The price at which
each buying and selling transaction takes is determination by the market forces (i,e. demand and
supply for a particular stock ).

Let us take an example for a better understanding of how market forces determine stock prices. ABC
Co. Ltd. Enjoys high investors’ confidence and there is an anticipation of an upward movement in its
stocks prices. More and more people would want to buy this stock (I.e., high demand) and very few
people will want to sell this stock at current market price. Therefore, buyers will have to bid a higher
prices for this stock to match the ask prices from the seller which will increase the stock prices of
ABC Co. Ltd. On the contrary, if there are more sellers than buyers for the stock of ABC Co. Ltd. In
the market, its price will fall down.

In earlier times, buyers and sellers used to assemble at stock exchange to make a transition but now
with the dawn of IT, most of the operations are done electronically and the stock markets have

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become almost paperless. Now investors don’t have to gather at the exchange, and can trade freely
from their home or office over the phone or through Internet.

PRIMARY MARKET

The Primary Market is the part of the capital market that deals with issuing of new securities.
Companies, governments or public sector institutions can obtain funds through the sale of a
new stock or bond issues through primary market. This is typically done through an investment
bank or finance syndicate of securities dealers.

The process of sellingnew issues to investors is called underwriting. In the case of a new stock issue,
this sale is an Initial Public Offering (IPO). Dealers earn a commission that is built into the price of
the security offering, though it can be found in the prospectus. Primary markets create long term
instruments through which corporate entities borrow from capital market.

Once issuedthe securities typically trade on a secondary market such as a stock exchange, bond

market or derivatives exchange.

Features of Primary market:

 This is the market for new long term equity capital. The primary market is the market where the
securities are sold for the first time. Therefore it is also called the New Issue Market (NIM).
 In the primary Issue, the securities are issued by the company directly to investors.
 The company receives the money and issues new security certificates to the investors.
 Primary issues are used by companies for the purpose of setting up new business or for
expanding or modernizing the existing business.

SECONDARY MARKET

The Secondary Market, is also called aftermarket, is the financial market in which previously
issued financial instruments such as stock, bondsoptions, and futures are bought and sold.The
term"secondary market" is also used to refer to the market for any used goods or assets, or an
alternative use for an existing product or asset where the customer base is the second market (for

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example, corn has been traditionally used primarily for food production and feedstock, but a
"second" or "third" market has developed for use in ethanol production).

With primary issuances of securities or financial instruments, or the primary market, investors
purchase these securities directly from issuers such as corporations issuing shares in as IPO or private
placement, or directly from the federal government in the case of treasuries. After the initial issuance,
investors can purchase from other investors in the secondary market.

The secondary market for a variety of assets can vary from loans to stocks, from fragmented to
centralized, and from illiquid to very liquid. The major stock exchanges are the most visible example
of liquid secondary markets – in this case, for stocks of publicly traded companies. Exchanges such
as the New York Stock Exchange, London Stock Exchange and NASDAQ provide a centralized,
liquid secondary market for the investors who own stocks that trade on those exchanges.

STOCK EXCHANGE

NATIONAL STOCK EXCHANGE

The National Stock Exchange of India was promoted by leading financial institutions at the behest of
the Government of India, and was incorporated in November 1992 as a tax-paying company. In April
1993, it was recognized as a stock exchange under the Securities Contracts (Regulation) Act, 1956.
NSE commenced operations in the Wholesale Debt Market (WDM) segment in June 1994. The
Capital Market (Equities) segment of the NSE commenced operations in November 1994, while
operations in the Derivatives segment commenced in June 2000.

NSE has more than, 1000 members. In NSE, a prospective trading member is admitted to any of the
following combinations of market segments: Wholesale Debt Market segment, Capital Market (CM)
and the Futures and Options segments, CM Segment and the WDM segment, or CM Segment, the
WDM and the F and O segment.

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BOMBAY STOCK EXCHANGE

Bombay Stock Exchange Limited is the oldest stock exchange in Asia with a rich heritage. Popularly
known as "BSE", it was established as "The Native Share & Stock Brokers Association" in 1875. It
was the first stock exchange in the country to obtain permanent recognition in 1956 from the
Government of India under the Securities Contracts (Regulation) Act, 1956.  Earlier an Association
of Persons (AOP), the Exchange is now a demutualized and corporatized entity incorporated under
the provisions of the Companies Act, 1956, pursuant to the BSE (Corporatization
and Demutualization) Scheme, 2005 notified by the Securities and Exchange Board of India (SEBI).
Bombay Stock Exchange Limited received its Certificate of Incorporation on 8th August, 2005 and
Certificate of Commencement of Business on 12th August, 2005. The Exchange has succeeded the
business and operations of BSE on going concern basis and its recognition as an Exchange has been
continued by SEBI.

The BSE has over 874 members-brokers across the country. There is no such thing at BSE and
members join as any of the following: Trading Members, Trading cum Clearing Members,
Professional clearing member, Limited trading member and Self Clearing member.

BSE NSE
Established in 1875 1992
Key person Mr. Ashish Chauhan (MD & CEO) Ms. ChitraRamkrishna (MD &
CEO)
No. of listed Companies More than 5500 More than 1400
Main index BSE Sensex CNX Nifty
Claim to fame Asia’s first stock exchange
Market Capitalization USD 1.68 Trillion (March 2015) US$ 1.65 Trillion (January
2015)
Website www.bseindia.com www.nseindia.com

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 DERIVATIVES IN STOCK MARKET

 Equity Derivatives
 Currency Derivatives

EQUITY DERIVATIVES

 EQUITIES:
An equity share, commonly referred to as ordinary share, represents the form of fractional ownership
in a business venture. Stockholders’ equity is often referred to as the book value of the company, and
it comes from two main sources. The first & original source is the money that was originally invested
in the company, along with any additional investments made thereafter. The second comes from
retained earnings that the company is able to accumulate over time through its operations. In most
cases, especially when dealing with older companies that have been in business for many years, the
retained earnings portion is the largest component.

Acquiring Equity Shares:

There are two methods:

 You may subscribe to issues made by corporates in the primary market. In the primary market,
resources are mobilized by the corporates through fresh public issues (IPOs) or through private
placements.
 You may purchase shares from the secondary market. To buy and sell securities you should
approach a SEBI registered trading member (broker) of a recognized stock exchange.

 DERIVATIVES:
As the name suggests, derivative is a financial instrument that offers a return based on the return of
some other underlying asset. In this sense, its return is derived from another instrument. The
definition states, a derivative's performance is based on the performance of an underlying asset. A
derivative also has a defined and limited life: A derivative contract initiates on a certain date and
terminates on a later date. Often the derivative's payoff is determined and/or made on the expiration

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date, although that is not always the case. In accordance with the usual rules of law, a derivative
contract is an agreement between two parties in which each does something for the other. In other
words, no money need change hands up front.

TRADING IN STOCK MARKET

This section will introduce us about the process and instruments used to help a customer or a client
to trade with arcadia securities. This process is almost similar to any other trading firm but there
will be some difference in the cost of brokerage commission.

Trading: It is a process by which a customer is given facility to buy and sell share this buying and
selling can only be done through some broker and this is where Arcadia helps its customer. A
customer willing to trade with any brokerage house need to have a demat account, trading account
and saving account with a brokerage firm. Anyone having following document can open all the
above mentioned account and can start trading.

Basic Requirement For Doing Trading:

Trading requires opening a Demat account. Demat refers to a Dematerialized Account. You need to
open a demat account if you want to buy or sell stocks. So it is just like a bank account where actual
money is replaced by shares. We need to approach the Depository participants (DP, they are like
bank branches), to open Demat Account.

How to open a Demat A/C?

For opening a demat account a customer have to fill a KYC form and has to submit the following
documents:

 3 photographs ( signed across)

 Photo Identification Proof - any of the following - Voter ID/Driving License/Passport.
 Address Proof any of the following - Voter ID/Driving License/ Passport/Bank statement or
pass book sealed and attestation by bank official/ BSNL landline bill.

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 A crossed Chequefavoring “Karvy Stock Broking”. Of the required amount. The amount for
Demat as well as trading will be Rs. 900/-(free Demat +900 Trading Account) the minimum
amount being Rs. 900 a cheque can be given for a larger amount.
 Copy of PAN Card is mandatory.
 Registration Kit
 CDSL Demat Kit
 Bank and address proof declaration.
 PAN name discrepancy form.

A depository is a place where the stocks of investors are held in electronic form. The depository
has agents who are called depository participants (DPs). Think of it like a bank. The head office
where all the technology rests and details of all accounts held is like the depository. And the DPs
are the branches that cater to individuals.

There are only two depositories in India –

 The National Securities Depository Ltd (NSDL) and

 The Central Depository Services Ltd (CDSL).

DIFFERENT TRADING STRATEGIES IN STOCK MARKET

The various techniques that are available in the hands of a client are:-

 Intraday
 Delivery
 Future
 Forwards
 Options
 Swaps

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 LEARNING

Working at Karvy Stock Broking Limited was largely an experience with gaining insights to a
number of new things. The On-The Job experience made it a worthwhile Internship, which gave me a
great real time Industry experience. All is not the same in real life as we read in books and on net
about the working methods of different divisions and segments. Each segment in an organization has
its own work culture followed by the members at Karvy Stock Broking Ltd. I had to put in my own
efforts and take initiative to learn and gain maximum knowledge possible during this period.
Primarily, the description of my work as a management trainee was to assist the wealth managers by
understanding the needs of the individual investors and corporate houses and expanding the customer
base of Karvy Stock Broking where I interned. The work assigned definitely required awareness and
understanding of the all the financial products Karvy Stock Broking. It also required me to know the
procedure and documents involved in purchase of any product by client. I just had a basic idea of the
products Karvy Stock Broking in prior internship, thus, acquiring knowledge about the same was
very exciting. There were training sessions held on various financial products like Mutual fund,
Insurance and Bonds which helped me get more insight in these topics. Interactive session was held
by the Mutual Fund expert, which proved quite useful but still Mutual Funds is a vast topic and it is
possible to gain full knowledge about it only after practically dealing in it.

Having knowledge about the product was just the initial step which prepared me to face the questions
asked by the inquisitive clients we targeted. Every step I had a new lesson to learn. During tele-
calling, we learnt the art of introducing ourselves and the company to the clients. It taught us how to
approach clients and suggest them various investment options. Our main aim was to convince the
prospective clients for appointment. We learnt that to understand the client’s mood at that point of
time was also important. You had to be polite and confident. If a client wanted to be called back at a
specified time, I did so without fail. No negligence was tolerated on this part as first impression is the
last impression and I didn’t want to lose out on any prospective client. The time given by the client
for the meet was given utmost importance. I and my colleague tried to reach the meeting place in
time so that the client didn’t have to wait. The entire experience of meeting the clients, explaining

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them the products, and based on the questions asked by us, as well as the client, analyzing their risk
taking capability and investment capacity was a learning in itself.

After gathering above information about the clients, we used to discuss the client’s details with the
Wealth Managers. Based on their investment requirements, investment objectives, risk taking ability
and the investment capability we would come up with suggestions as to where they should invest and
how much. If the client had already invested in any of the financial products, we tried gathering
details about the same. If the client had already invested in equities and wanted to invest in safer
investment options, we suggested him to go for Income Scheme in Mutual Funds or Bonds. There
were investors who wanted high returns but didn’t want to take greater risk. To such investors
investments in mutual funds rather than equities was suggested. Investors wanting to invest for taxes
saving purpose were suggested to invest in Tax Saving mutual Funds like SBI, sHDFC tax Benefit
Scheme. I also gave a presentation on the basis of self-study and trainings provided to me on Mutual
Funds. This helped me improve my presentation skills and knowledge about the same. As a
student, I have given many presentations but this one gave me a chance to face the corporate
heads as evaluators. The feedback for the same was good but scope for improvement always remains.
Also the deadlines given to me for completion of assignments and reports helped me experience real
time corporate work pressure. My awareness and knowledge on the investment options, which was
minimal prior internship has strengthened and expanded post internship.

Other than working ‘Live’ at the office I also benefited by assignments given to us such as visiting
other competitors of Karvy Stock Broking Limited and gathering investment advices from their side
for new and budding investors. Usually for new investors they either suggest Insurance (if the client
doesn’t have one), Mutual Funds or Equities but for long term. The experience and know-how gained
from this internship, has left me in more compliant form and stature in order to fare better in areas of
similar interest. With an optimistic view towards future, and with the desire to implement all the
knowledge gained, I hereby conclude my report on my Internship at KARVY STOCK BROCKING
LIMITED, INDORE.

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 SUGGESTIONS

 Working as an internship in Karvy Stock Broking Ltd, Infelt that Karvy can go for promotional
activities for gaining more market share as Karvy’s competitors are doing the same.
 Karvy should try to minimize its brokerage.
 The company should organize the seminars and similar activities to enhance the knowledge of
prospective and exiting customers, so that they can feel more comfortable while investing in
stock market.
 They should upgrade their technology. As their competitor already have advance version of
technology.

CONCLUSION

While doing my summer internship program I came to a conclusion that this training has helped me
much in getting the thorough knowledge about some of the stock broking companies, how these
companies are competing against each other for getting the more market share, how they are
applying different marketing strategies to attract customers and making them satisfied.

Company gave knowledge about the demat account, its benefits, how does it provides services the
customers of which I was totally ignorant when I started my project.I gathered much more
knowledge about Karvy Stock Broking Ltd. Its services, its strategies, and how every employees of it
work hard to achieve the organizational goal I.e. achieve the maximum market share through
customer satisfaction.

One thing that I noticed during my field work that many people of Indore not much more aware
about the various financial products and services of Karvy which had to be there. They are ignorant
about demat account and lack of knowledge and information about it scared them of investing money
in share market. So to generate awareness among them advertising campaign can result in fruitful
results. Only a limited percentage of people are enjoying investing money in share market in Indore.

Lastly and not the least as a coin has two sides, Karvy has favorable and unfavorable aspects. The
favorable aspect is that it provides lot of benefits to its customers which some of its competitors fail
to provide and again less awareness about it among people is its negative side which hinders them to
invest their fund confidently.

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