A PROJECT REPORT

ON

³RISK MANAGEMENT REGARDING WORKING OF A BROKING FIRM, AND ITS INVESTORS ´
AT

RELIGARE SECURITIES LTD
SUBMITTED BY

MAHENDRA SINGH
PGDM MARKETING

UNDER THE GUIDANCE OF

SWETA SAURABH

GALGOTIAS BUSINESS SCHOOL

1

DECLARATION

I, the undersigned, hereby declare that the Project Report entitled ³ RISK MANAGEMENT REGARDING WORKING OF A BROKING FIRM, AND ITS INVESTORS´ written and submitted by me to the GALGOTIAS BUSINESS SCHOOL, New Delhi in partial fulfillment of the requirement for the award of degree of Master of Business Administration under the guidance of P rof. sweta saurabh is my original work and the conclusions drawn therein are based on the material collected by myself.

Place: greater noida Date: /09/2009

Mahendra singh
Research Student

2

ACKNOWLDGEMENT

It¶s a great privilege that I have done my project in such a well-organized and diversified organization. I am great full to all those who helped and supported me in completing the project.

First of all I would sincerely like to thank Mr.amit virmani (Branch Manager, noida), for his valuable guidance and kind co-operation during the project. I am highly grateful to Mr. Chandan sir (Sr. Sales Manager) for the help provided by them in various forms.

I am also thankful to our Mr. Hardeev singh dearo and my project guide Mr.Chandan Sir for helping me in completing the project.

Last but not least, I am also thankful to my parents, all college staff and my friends for helping me directly or indirectly in my project

3

INDEX

Sr No.

Contents

Page No.

Executive Summary 1 INTRODUCTION
1.1 1.2 1.3 1.4 1.5 1.6 1.7 Basic Concepts of the Topic Literature Review Need for the Study Statement of the Problem Objectives of the Project Research Hypothesis Scope of the Study

I-III 1-15

2

PROFILE OF THE ORGANISATION
2.1 Name of the Organisation 2.2 Vision and Mission 2.3 History and Background 2.4 Group Structure 2.5 Services 2.6 Organisation Structure 2.7 Competitors of Religare Sec. Ltd. 2.8 About Religare Sec. Ltd. 2.9 The Religare Edge

16-24

3

RESEARCH DESIGN & METHODOLOGY
3.1 Introduction to Research Methodology 3.2 Sampling Design 3.3 Sources of Data Collection 3.4 Limitations of Study

25-28

4

DATA PRESENTATION, ANALYSIS INTERPRETATION
4

29-37

2 Policy Suggestions 5.1 Main Findings (Conclusions) 5.3 Scope of Development 38-41 6 7 BIBLIOGRAPHY ANNEXURE 42-43 44-46 5 .5 FINDINGS & SUGGESTIONS 5.

4 5.1 5.2 5. 5.6 5.3 5.7 Preference of Investment Awareness of Online Share Trading Awareness of Religare as a Brand Awareness of Religare¶s Facilities DEMAT Account Market Satisfaction level of Customer Frequency of Trading % of Earning Invested in Trading 30 31 32 33 34 35 36 6 .5 5. Title of the Table Page No.LIST OF TABLE Table No.

3 5. 5.4 5.6 5.1 5.7 Preference of Investment Awareness of Online Share Trading Awareness of Religare as a Brand Awareness of Religare¶s Facilities DEMAT Account Market Satisfaction level of Customer Frequency of Trading % of Earning Invested in Trading 30 31 32 33 34 35 36 7 .LIST OF CHART Chart No.2 5.5 5. Title of the Chart Page No.

managing it was felt most essential by the regulatory bodies and exchanges. the mode of investment. whether in stock. It is measured in terms of consequences and likelihood´. Risk can be defined as ³Possibility of suffering losses´ ³The chance of something happening that will have an impact upon objectives. bullion.  To understand various risk for the investors of the broking firm. Need of the Study: Create awareness among investors about the different risks involved in the broking firms.  To manage and reduce the identified risks.  To understand various risks involved in the broking firm. 8 . banking. Risk management in a Broking Industry is a new concept in India. The degree of risk however varies on the basis of the features of the assets. financial sector. real estate. capital market. time frame or the issuer of the security etc.³Risk Management Regarding Working of a Broking Firm and Its Investors´ Name of the Organisation: . Objectives of the Project: To get familiar with the working of a broking firm.Religare Securities Ltd Introduction: . investments instrument.EXECUTIVE SUMMARY Project Title: .All investments are risky. since it Posses¶ maximum risk in the financial market. gold etc.

 A periodical compliance review should be conducted to ensure conformity with the rules and regulations. Conclusions: The researcher found that the working of a broking firm is a very risky job because risk is involved in each and every activity of the business.e.  The risk prevailing in the business is recognized therefore an efficient risk management department is essential in every broking firm. the period of 60 days is not enough. Understand the total transparency and automation of broking firm  Give basic knowledge to investors regarding risk in broking firm  Also understand the equity market and different way of trading Research Hypothesis: . Limitations of Study: To understand the overall working of share market. So there is increase in various broking firms. turnover wise as well as area of operation wise. The activities have reached through lengths and breadth of the country.  Broking business is a client-based business.  The designated compliance officer should perform a review of trading Practices annually. personnel responsible for the risk management function should be separate from trading floor personnel. The working of a broking firm is a very risky job because risk is involved in each and every activity of the business. There is need of continuous up gradation of internal control measures  Staff in a broking firm is continuous busy and due to which they are always under stress. The recent trend of voluminous increase in investors has also increased the risk involved in it. 9 . Suggestions: An Organization should have a risk management function that is independent of its trading staff i.Capital Market is growing very fast.

very few investor and agents have a detail knowledge of the study. which restricted the scope of the study. Moreover.  The study was conducted in Ahmednagar only. 10 .

CHAPTER I INTRODUCTION 1. provident fund. Tax anomy of financial markets can be understood on functional. Capital market (long term) 2. pension funds. sectoral and institutional basis. On a functional basis we can divide financial markets into 1. The financial assets comprise of banking accounts. Money market (short term) What is Capital Market? A Capital Market deals in financial assets. excluding coins and currency. 11 . which operate the financial markets and the financial instruments with which the financial system is put into operation.1 Basic Concepts of the Topic Introduction to Capital Markets Financial System The financial system of every economy consists of various constituents such as 1) Financial Institutions 2) Financial Companies 3) Financial Markets 4) Financial Instruments 5) Financial Services 6) Financial regulations The financial market in India comprised of capital market and money market whereas the financial system of the country comprised of institutions.

They may issue the securities in domestic market and/or international market. shares. debentures. It deals in short term financial assets which can be readily converted into cash. insurance policy. the instruments can be traded at low cost and are highly liquid. capital markets are generally also known as security/stock market. Primary market The primary market provides the channel for sale of new securities. The Indian Capital Markets can be broadly classified into three types of markets. In our country. to raise resources to meet their requirements of investment and/or discharge some obligation. They may issue the securities at face value. 12 . If the stock exchanges are well regulated and function smoothly. Secondary market Money market The money market is part of overall financial system and securities or capital market. Primary market 3.mutual fund. India has multi-stock exchange system with more than 24 stock exchanges functioning across the country. Primary market provides opportunity to issuers of securities. Money market 2. 1. Money market is a place for trading in money and short tern financial assets that are as liquid as money. Stock exchange provide a good leverage of the capital market and their relationship is directly proportional. Government as well as corporates. debt etc. It provides a platform for short term surplus funds of lenders or investors and short term requirements of borrowers. or at a discount/premium and these securities may take a variety of forms such as equity. then it is an indication of healthy capital market. and other securities.

RISK MANAGEMENT Risk is defined as ³possibility of suffering losses´ This risk in itself is not bad. identifying uncertainties. Principles of Risk management are as follows 1 Global Perspective Viewing development within the context of large level developments Recognizing both the potential value of opportunity and the potential impact of adverse effects 2 - Forward looking view Thinking towards tomorrow.Secondary Market Secondary market refers to a market where securities are traded after being initially offered to the public in the primary market and/or listed on the Stock Exchange. risk is essential to progress. but we must learn to balance the possible negative consequences of risk against the potential benefits of its associated opportunities. anticipating potential outcomes Managing project resources and activities while anticipating uncertainties 3 - Open Communications Encouraging free-flowing information at and between all project levels 13 . This is risk management. Secondary market comprises of equity markets and the debt markets. Majority of the trading is done in the secondary market. and failure is often key part of learning.

and knowledge Functions of Risk Management are as follows i.- Enabling formal.Transform risks data into decision-making information. and proper communication Using processes that value the individual voice (bringing unique knowledge and insight to identifying and managing risk) 4 Integrated management Making risk management an integral and vital part of project management Adapting risk management methods and tools to a projects infrastructure and culture 5 Continuous processes Sustaining constant vigilance Identifying and managing risks routinely through all phases of the projects lifecycle 6 Shared product vision Mutual product vision based on common purpose.Translate risk information into decision and mitigating actions (both present and future) and implement those actions 14 . and prioritize them iii. ii. classify risks. and collective communication Focusing on results 7 Team work Working cooperatively to achieve common goal Pooling talents. Evaluate impact. shared ownership. probability. informal.Search for and locate risks before they become problems Analyze . skills. Plan . Identify . and time frame.

Correct for deviations from the risk mitigation plan. It vary from stock to stock and instrument to instrument Categorization of stocks for imposition of margins Daily margins payable by members consists of the following: 1. comprising of the sum of VaR margin and mark to market margin is payable.iv. Communicate . 15 . and emerging risks. Mark to Market Margins Daily margin. which is constantly upgraded to preempt market failures. Value at Risk Margins 2. risk containment measures that were common internationally but were absent from the Indian Securities Market.Provide information and feedback internal and external to the project on the risk activities. Margins depend upon the volatility and market conditions. since it poses maximum risk in the financial market. RISK MANAGEMENT IN A BROKING FIRM Risk management in a Broking Industry is a new concept in India. managing it was felt most essential by the regulatory bodies and exchanges. v. Whereas SEBI has given some guidelines under Investors Protection to protect investors risks. NSCCL has put in place a comprehensive risk management system. NSE has given the following risk management measures Margins NSE has specified Different margins for different instruments like stocks futures and options etc.Monitor risk indicators and mitigation actions Control . Therefore NSE introduced for the first time in India. Track . vi. These measures were taken to reduce the brokers¶ risks. current risks.

in case of a member. VaR margin rate & Security category Mark-to-Market Margin Mark to market margin is computed on the basis of mark to market loss of a member.Value at Risk Margin VaR margin is applicable for all securities in rolling settlement.: if the VaR based Margin rate is 10. it would be rounded off to 11. All securities are classified into three groups for the purpose of VaR margin. the net position of the member in the security would be taken as 2000. The VaR based margin would be rounded off to the next higher integer (For E. the latest available closing price at the NSE is considered as the closing price. 0 1.g. The net positions at a client level for a member are arrived at and thereafter. at the end of the relevant day were closed out at the closing price of the securities as announced at the end of the day by the NSE. The VaR margin rate computed as mentioned above will be charged on the net outstanding position (buy value-sell value) of the respective clients on the respective securities across all open settlements. 00) and capped at 100%. In case the security has not been traded on a particular day. 16 . The buy position of client A and sell position of client B in the same security would not be net ted. it is grossed across all the clients for a member to compute gross exposure for margin calculation. if client A has a buy position of 1000 in a security and client B has a sell position of 1000 in the same security. It would be summed up to arrive at the member's exposure for the purpose of margin calculation. Mark to market loss is the notional loss which the member would incur in case the cumulative net outstanding position of the member in all securities. For example. Mark to market margin is calculated by marking each transaction in scrip to the closing price of the scrip at the end of trading.

the difference between the buy and sell values would be considered as notional loss for the purpose of calculating the mark to market margin payable.In the event of the net outstanding position of a member in any security being nil. in case the transaction in a script with one particular client in a settlement exceeds Rs 10 laks then the member are to send the photocopies of the transfer deeds and the share certificates to the company/ registrar for verification of the material particulars. This information is to be made available to the exchange authorities whenever called for. A similar procedure is also to be followed for existing clients. 2. damage to computer systems and a 17 . In case the member broker fails to furnish the same it is viewed seriously. 3.e. Inspection The department is carrying out inspection of the member brokers records as regards compliance of the risk management procedures 4. Insurance The exchange presently has in place insurance policies to protect itself in the event of losses on account of fire. The basic idea behind the introduction of this procedure is to prevent fake/forged/stolen shares from being introduced in the market. Know your client scheme Under the procedure the member brokers of the exchange are compulsory required to obtain detailed information of clients prior to commencement of any transactions with new clients. Some Risk management are also taken by BSE they are as follows 1. Verification of shares at members office The exchange has outlined the process i.

sub brokers.brokers. portfolio managers.comprehensive policy that covers risks faced by the exchange. Uniform Trading hours at all the stock exchanges in the country to check arbitrage. destruction. Regulation on insider trading with the object to curb it completely and punish the guilty 2. The risks covered under the basic cover of the policy are detailed as below. non member brokers. 3. registrars to issues. 18 . Registration of market players. its member brokers and the clearinghouse. Loss to members on account of infidelity of employees Loss of member on account of fake/forged/ stolen shares being introduced by his clients Direct financial losses suffered by the member broker on account of physical loss. theft or damage to securities and cash. Loss on account of securities lost in transit Loss suffered on account of incomplete transaction Loss sustained as final receiving member on exchange on account of default of the introducing member Loss on account of errors and omission Directors and officials liability cover Measures taken by SEBI for Investors protection are as follows Government of India and SEBI have been stressing upon the need for regulating the secondary market and bringing transparency in transactions on the floor of stock exchanges The steps taken by SEBI to regulate and control the business of stock exchanges and reduce the risks of investors are as follows 1. underwriters. merchant bankers.

4. DSE and other exchanges. Dematerialization of securities permitted on a selective basis. custodians etc so as to have access/inspection of their books. 60 and 90 days. Appointment of administrators to check bad deliveries 19 . Regulation for fraudulent trade practices 14. Indirect supervision through stock exchanges in day-to-day business by fixing margins. Stern action against erring brokers. 11. Circuit breaker system to check volatility on the exchanges 17. 5. 8. etc. 16. Total transparency and automation of stock exchanges. National Stock Exchange. 9. merchant bankers. Recent Development steps taken by SEBI for Investor protection 1. BSE. records and verification of transactions. Stress upon shorter settlement period. Brokers to keep clients money in a separate bank account. 12. 20. Derivative trading in index based futures of 30. Introduction of modified carry forward system and automated lending borrowing mechanism (ALBM). Effective margin system for smooth settlement. 19. penalties and fines. imposing curbs. Introduction of Internet trading. 18.. 13. companies. Brokers contact notes to mention brokerage separately. Nationwide paperless trading through over the counter exchange of India. about 3500 companies will have compulsory t rading in Demat mode. 15. By March 2001. Forward trading being banned on stock exchanges 10.debenture trustees. Practicing prudent governance norms. 6. Gradual automation to reduce paper work and ensure transparency in transactions this is now almost complete and all stock exchanges have been computerized. stock exchanges. 7.

Trustees to ensure that fund is not deployed in risky instruments or for the benefit of any member but only in prescribed avenues. 4. 3. SEBI has decided to appoint administrator to implement the signature guarantee and certificate authentication programs. The administrators appointed by SEBI act on behalf regulator in resolving problems arising out of signature mismatch 2. regulations. 1882 with independent trustees Regular contributions from active member brokers and stock exchanges Fund to be utilized only for investor claims and not broker claims.To get rid of bad deliveries. Service centers for investors SEBI has directed all stock exchanges to constitute service centers for investors to enable the investors to have a form for recording and counseling of their grievances as well as access financial and other information of companies on government policies. rules. Compliance Officer Each company is required to appoint compliance officer who would be able to verify rumors and information floating in the market about the 20 . Time schedule to be specified while setting investor claims. etc. Streamlining Investor protection fund The committee set up by SEBI to review the sources and utilization of investor protection fund of stock exchanges has made following recommendations Funds should be on trust structure and set upon under Indian Trust Act.

Investor Education SEBI has taken steps to educate investors through various awareness programmes and publications 1.2 Literature Review No one has done work over there yet.L. In this I also read the various modules of NCFM. 6. In literature review I read various documents provided by the manager of Religare Sec.Dr.company to the stock exchange. In this I reffer the Demat Visiting various websites.C. Corporate Governance SEBI has prescribed prudent corporate governance norms for all listed companies to ensure transparency and better disclosure practices. on this topic. And also read the following books: i) FINANCIAL SERVICES AND MARKETS Author: .R. which aids in price manipulation. 5.M.K. This will reduce motivated rumors about companies. Gurusamy form of the Religare Sec.Rampal & S. Gupta 21 . And ii)RESEARCH METHODOLOGY METOHDS & TECHNIQUES Author: .Kothari iii)PROJECT REPORT WRITING Author: .

3 Need for the Study  Create awareness among investors about the different risks involved in the broking firms.  To understand various risks involved in the broking firm.1. 22 .  Understand the total transparency and automation of broking firm  Give basic knowledge to investors regarding risk in broking firm  Also understand the equity market and different way of trading  Convert our therotical knowledge in to practical knowledge 1. Due to none availability of the proper guidance most of the person take stock market as gambling. 1. But People don¶t have basic knowledge regarding stock market. So they not understand there is various risk involved in the working of broking firm.  To understand various risk for the investors of the broking firm.  To manage and reduce the identified risks.4 Statement of the Problem There are several financial security companies playing their roles in Indian equity market.5 Objectives of the Project  To get familiar with the working of a broking firm.

They also understand what information provide to investor for avoiding the risk. turnover wise as well as area of operation wise. 23 . So there is increase in various broking firms. The activities have reached through lengths and breadth of the country.1. 1. The working of a broking firm is a very risky job because risk is involved in each and every activity of the business.7 Scope of the Study Company can take review from market through this project.6 Research Hypotheses Capital Market is growing very fast. Management people can get overall idea about the risk management regarding working of broking firms.

Corporate Office: 19 Nehru Place.2 VISION & MISSION- 24 . Deepak Hospital.1 NAMERELIGARE SECURITIES LTD. Pune ± 411004 AHMEDNAGAR: 5&6.in : RELIGARE to 58888 PUNE: Ground Floor. Himalaya Tower. Ahmednagar . Opp. Savedi Road.in : info@religare.religare. Amar Caliber.CHAPTER II PROFILE OF THE ORGANISATION 2.414003 2. New Delhi ± 110019 Website Email SMS : www. BMCC Road. Shivajinagar.

Harrison & Co. The Company is a member of the National Stock Exchange (NSE) and OTCEI. was incorporated in London in the year 25 . REL acquired UK-based Hichens. in 2008 which was subsequently re-named as Religare Hichens Harrison PLC ("RHH"). Brand Essence ± ³Core brand essence is Diligence and Religare is driven by ethical and dynamic processes for wealth creation´. 43 sub-regional offices. Hichens. Ex-CMD of Ranbaxy Laboratories Ltd.837* business locations all over India. Harrison & Co. 2. The growing list of financial institutions with whom RSL is empanelled as approved Broker is a reflection of the high levels of services maintained by the Company. (RSL) is a wholly owned subsidiary of RELIGARE Financial Services Ltd. The primary focus of Religare Securities Ltd. a Company promoted by the late Dr. and has a presence in 498* cities and towns controlling 1. (RFSL). is to cater to services in Capital Market Operations to Institutional Investors.Parvinder Singh. Company¶s Mission ± ³Providing complete financial care driven by the core values of diligence and transparency´. To make a mark in the global arena.Company¶s Vision ± ³To build Religare as a globally trusted brand in the financial services domain and present it as the µInvestment Gateway of India´. REL operates from seven domestic regional offices.3 History and background RELIGARE Securities Ltd.

RELIGARE financial services group comprises of Religare Securities Limited.1803 and is believed to be one of the oldest firms of stockbrokers in the City of London. Member of National Stock Exchange of India and Bombay Stock Exchange of India. Besides the reach of RELIGARE. which encompasses fundamentals as well as technical knowledge. RELIGARE Comdex Limited and RELIGARE Finvest Limited which provide services in Equity. Pursuant to expansion of REL's business. South Africa. other than India. depository services etc. Commodity and Financial Services business & Religare Insurance Advisory Ltd. Depository Participant Service. RELIGARE SECURITIES LIMITED 1. the company has grown from largely an equity trading company into a diversified financial services company. 26 . RELIGARE is a pioneer in the concept of partnership to reach multiple locations in order to effectively service its large base of individual clients. RELIGARE GROUP: RELIGARE in recent years has expanded its reach in health care and financial services wherein it has multiple specialty hospital and labs which provide health care services and multiple financial services such as secondary market equity services. Advisory on Mutual Fund Investments and Portfolio Management Services. (the UK. The bouquet of services offered by RELIGARE includes Broking (Stocks and Commodities). RELIGARE was founded with the vision of providing integrated financial care driven by the relationship of trust. portfolio management services. the USA. With the addition of RHH the REL group now operates out of multiple global locations. Dubai and Singapore). Brazil. the clients of the company greatly benefit by its strong research capability.

RSL provides platform to all segments of the investor to leverage the immense opportunity offered by equity investing in India either on their own or through managed funds in Portfolio Management. 2. of the Religare Securities Ltd. A SEBI approved Portfolio Manager.4 Religare Enterprises Limited Religare Securities Limited Equity Broking Online Investment Portal Portfolio Management Services Depository Services Religare Commodities Limited Commodity Broking Religare Finvest Limited Lending and Distribution business Proposed Custodial business Religare Insurance Broking Limited Life Insurance General Insurance Reinsurance Religare Arts Initiative Limited Business of Art Gallery launched . is required by to be available with the broker who deals on behalf of investors or sell the mutual funds of the different companies present in the market.2. Depository Participant with National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL). is 33764.arts-i Religare Venture Capital Limited Private Equity and Investment Manager 27 Religare Capital Markets Limited Investment Banking Proposed Institutional Broking Religare Realty Limited In house Real Estate Management Company . The ARN No. The ARN No.

Religare Hichens Harrison** Corporate Broking Institutional Broking Religare Asset Management* Derivatives Sales Corporate finance 2.5 SERVICES :- Equity Arts Initiative Commodit y Investment Banking REL Mutual Fund Wealth Advisory Services Insurance Personal Credit 28 .

6 Organization Structure: 29 .2.

2. But Religare faces competitions from these few companies.7 Competititors of Religare:There are several financial security companies playing their roles in Indian equity market. 30 .

8 About Religare Securities Limited (RSL)  One of the leading integrated financial services groups of India 31 . ICICI Direct.com  India Bulls  HDFC Securities  5paisa.com  Motilal Oswal  IL&FS  Karvy 2.com  Share Khan (SSKI)  Kotak Securities.

 ³Sweetly placed´ to spot new opportunities and power ahead.  Pan India and global footprint. Diverse range of offerings  Client base of more than 5000.  Width and depth of management leading a formidable employee base. 2. wealth and Institutional Spectrum.000 and growing across the retail.9 The Religare Edge  Diverse offerings  Dynamic Management Team  State-of-the art technology  Vast Distribution and Reach  Robust Brand Recognition  Synergistic partnerships  Innovative Initiatives 32 .  Best-in-class Research.

Research Methodology is a way to solve research in study and solving research problems along with logic behind them are defined through research methodology. Because the population is too large so it is difficult to survey.1Introduction to Research MethodologyResearch Methodology comprises defining and redefining the problem. organizing and evaluating the data. making deduction and reaching to conclusions and determines whether the formulated hypothesis is right and wrong. 3. Thus while talking about research methodologies we are not only talking of research methods but also consider the logic behind the methods. formulating hypothesis or suggesting solution. collecting.CHAPTER III RESEARCH DESIGN & METHODOLOGY 3. I collected data through various sources primary & secondary. During my project. 33 .2Sampling Design ± I have taken sample size of 50 respondents.

Any organization whether big or small.3 Sources of Data Collection- Primary source includes:1) Discussion with branch manager 2) Discussion with experts 3) Discussion with investors of the firm. 4) Live trading in the market 5) Data collected from questionnaire. private or public need different types of information are to know its popularity. I have gathered secondary data and primary data and collected information from the combination of these two data. 3. Secondary source includes:1) Various books related to stock market 2) Books related to Financial Management 3) Web sites were used as the vital information source 4) References given by Relationship Manager 34 .

4 LIMITATIONS OF STUDY  To understand the overall working of share market.  The study was conducted to understand with respect to Risk involved in broking firm and investors.  Moreover. 35 . the period of 60 days is not enough. which is a part of the equity share market. very few investor and agents have a detail knowledge of the study.  The study was conducted in Ahmednagar only. which restricted the scope of the study  The data provided by the investor and the agents can¶t be held true as 100% correct.3.

1 36 . 5. ANALYSIS & INTERPRETATION 1) Preference of Investment: Financial Instruments Shares Mutual Funds Bonds Derivatives Source: Primary Data No.CHAPTER IV DATA PRESENTATION.1) Chart 5. Of Investors (50) 37 8 4 1 (Table No.

with a more transparent system. investment in the Stock Market can definitely be increased.2) Chart 5.2 Interpretation: With the increase in cyber education. So. This awareness is expected to increase further with the increase in Internet education. 2) Awareness of online Share trading : YES 45 NO 5 Source: Primary Data (Table No. 5. 37 . the most favored investment continues to be in the Share Market.Interpretation: This shows that although the mutual funds market is on the rise yet. the awareness towards online share trading has increased by leaps and bounds.

3 Interpretation: This pie chart shows that Religare has a reasonable amount of Brand awareness in terms of a premier Retail stock broking company. YES 29 NO 21 Source: Primary Data (Table No. 5.3) Awareness of Religare as a Brand.3) AWARENESS OF RELIGARE AS A BRAND 43% YES NO 57% Chart 5. 38 . The company to increase its market share over its competitors should further leverage this brand image.

4) Chart 5. it is to be noted that the customers are not aware of the facilities provided by the company meaning thereby.4 Interpretation: Although there is sufficiently low brand equity among the target audience yet.4) Awareness of the facilities provided by Religare : YES 42 NO 8 Source: Primary Data (Table No. the company should concentrate more towards promotional tools and increase its focus on product awareness rather than brand awareness. 39 . 5. that.

40 . Non ± transparent marketing policies of the company Hence. 5. Lack of promotion and unfocussed approach towards Product awareness 2.5) DEMAT Account Market : INVESTORS 6 15 4 12 13 (Table No. This is probably because of two main reasons: 1.5 Interpretation: This shows that even with sufficiently high Brand Equity.5) BROKING FIRMS Religare Securities ICICI Direct Kotak Securities India Bulls Others Source: Primary Data Chart 5. the company should crystallize its products and should indulge in aggressive marketing and promotion. Religare ranks only 3rd amongst the Demat account providers.

92% No .6) Satisfaction level among Customers with current Broker : YES 46 NO 4 Source: Primary Data (Table No.8% Chart 5. has gone beyond only meeting Sales targets and generating profit volumes. 41 .5. It shows that all the competitors are striving hard not only to woo the customers but also to make them Brand loyal by generating customer satisfaction.6) Satisfaction level among Customers with current broker Yes . today.6 Interpretation: This pie chart accentuates the fact that Strategic marketing.

we see that there is still a dearth of active traders and investors. OF INVESTORS 5 13 26 6 (Table No.7 Interpretation: In spite of the huge returns that the share market promises.7) How often do you trade: FREQUENCY OF TRADING Daily Weekly Monthly Yearly Source: Primary Data NO. It requires efficient bureaucratic intervention on the part of the Government. This is because of the non ± transparent structure of the Indian share market and the skepticism of the target audience that is generated by the volatility of the stock market. 5.9 Weekly. 42 .27 Monthly-53% Y early-11% Chart 5.7) Freq e cy f Tradi Daily.

43 . effective and efficient steps should be undertaken to woo the customers to invest more in the lucrative stock market.8) Percentage of earnings invested in Share Trading : % of Earning Invested Up to 10 % Up to 25 % Up to 50 % Above 50 % Source: Primary Data No. of Investors 35 9 4 2 (Table No.8 Interpretation: This shows that people invest only upto 10% of their earnings in the stock market. again reiterating the volatile and non-transparent structure of the Indian stock market. Hence. 5.8) Chart 5.

1 MAIN FINDINGS (CONCLUSION) Working with a broking firm especially was really a great experience. The recent trend of voluminous increase in investors has also increased the risk involved in it. The activities have reached through lengths and breadth of the country. All these necessitated in the introduction of latest technology in the form of advanced software¶s.  Capital Market is growing very fast.  Broking business is a client-based business.  The risk prevailing in the business is recognized therefore an efficient risk management department is essential in every broking firm.  The researcher found that the working of a broking firm is a very risky job because risk is involved in each and every activity of the business. There is need of continuous up gradation of internal control measures  Staff in a broking firm is continuous busy and due to which they are always under stress. 44 .CHAPTER V FINDINGS & SUGGESTIONS 5. turnover wise as well as area of operation wise.

emphasizing segregation of duties and validation of data integrity. staff of risk management function and investors regarding procedures for measuring and managing risk. 45 .2 POLICY SUGGESTIONS  An Organization should have a risk management function that is independent of its trading staff i.  Senior management should regularly evaluate the risk management procedure in place to ensure they are appropriate and sound.5. reviewed.  Risk management or control function should be able to produce a risk management report that highlights positions. signed and returned to control staff. franchisee. This report should be sent to senior management.  Senior management should also foster and participate in active discussions with the board of directors.  Auditors should perform a comprehensive review of risk management annually.e. relationship officer and sales but also all back office functions responsible for risk management and internal control. sub brokers. limits and excess on a basis commensurate with trading activity. personnel responsible for the risk management function should be separate from trading floor personnel.  Highly qualified staff not only in front office positions such as trading desk.

However I would like to make a few points. well-trained and less stressed dealers will help in reducing the mistakes. which would help the organization in a big way. the sub brokers and client will help in reducing the delay in giving limits. It has been observed that most of the mistakes are done when they are under stress. which will facilitate to resolve the disputes at different levels.  Fast and frequent interaction between the risk managers. 5.  Regarding dealers risks.  Recording of trader and dealer telephone calls. quality of clientele will help in balanced growth of business and minimizing the risk. 46 .  Periodical visits to the sub brokers and franchisee by the RELIGARE SECURITIES personnel for interaction and inspection will help in minimizing the risk to great extent. HRD must help in this matter.3 SCOPE FOR DEVELOPMENT RELIGARE SECURITIES) RELIGARE SECURITIES have set themselves very stringent and high standards of Risk Management. The designated compliance officer should perform a review of trading Practices annually.  In settlement department the persons have be appointed with utmost care and their periodic check can be conducted to avoid any employee fraud.  Along with large client base.

bseindia.com  www.in  www.google.K.nseindia. 47 .CHAPTER VI BIBLIOGRAPHY & WEBLIOGRAPHY FINANCIAL SERVICES AND MARKETS Author: .co.C.M.in  Dalal Street  Various books of Equity Management.com  www.Kothari  PROJECT REPORT WRITING Author: .L. Gupta  www.Rampal & S.religare. Gurusamy  RESEARCH METHODOLOGY METOHDS & TECHNIQUES Author: .Dr.R.

How often do you trade? Daily Weekly Monthly Yearly 48 .ANNEXURE QUESTIONNAIRE Q1. With which company do you have your DEMAT account? Religare ICICI Direct Kotak Mahindra India Bulls Others (please specify) __________ Q6. Are you currently satisfied with your Share trading company? Yes No Q7. Do you know about the facilities provided by Religare? Yes No Q5. Heard about Religare? Yes No Q4. Are you aware of online Share trading? Yes No Q3. In which of these Financial Instruments do you invest into? Shares Mutual Funds Bonds Derivatives Q2.

Is broking firms are always risk free? Yes No Q10. What percentage of your earnings do you invest in share trading? Up to 10% Up to 25% Up to 50% Above 50% Q9.What more facilities do you think you require with your DEMAT account? ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------Additional Information (optional) Name: Age: Phone No: Occupation: 49 .Q8.

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