Comparative Analysis of Bajaj Fin.

Serv Schemes with other Lenders

Chapter I

OBJECTIVE :

PRIMARY OBJECTIVE:

To compare the schemes offered by Bajaj FinServ with its competitors.

SECONDARY OBJECTIVE:

To find out Competitors / Schemes similar to Bajaj Fin.Serv. To find out the best financing scheme offered by the lenders. To Analyze Competitors schemes with reference to Bajaj Fin.Servs Products. To find out the customer perception about Bajaj Finserv.

METHODOLOGY: Methodology is a systematic procedure of collecting information in order to analyze and verify a phenomenon. The collection of information is done through two principal sources. 1. Primary Data. It is the information collected directly from sales finance department for further studies, it was mainly through interviews with concerned officers and staff, either individually or collectively, sum of the information has been verified or supplemented with personal observation and real time work experience 2. Secondary Data. Secondary data is the published data. It is already available for using and its saves time. The mail source of secondary data are published market surveys, government publications advertising research report and internal source such as sales,

sales records orders, customers complaints and other business record etc. the study has also depended on secondary data to little extent, which is collected through internal source SCOPE: To compare the schemes offered by Bajaj FinServ with its competitors. To find out Competitors / Schemes similar to Bajaj FinServ To find out the best financing scheme offered by the lenders. To Analyze Competitors schemes with reference to Bajaj FinServ Products. To find out the customer perception about Bajaj Finserv.

TOOLS AND TECHNIQUES OF ANALYSIS: Bajaj FinServ were the first to introduce a 3 min on the spot approval for our Consumer Durables Finance offer. We are now down to 3 seconds. Loan amounts of up to Rs.5 lacs You can get up to 5 lacs at 0% towards the purchase of your favourite consumer durable Instant and on the spot approval You don't have to visit any branch or wait for days to get your loan approved. Through our in store representatives present in the consumer durables store, you can get instant approval in 3 mins. All you need is basic documents like a PAN card, Driving license etc and a few details. Minimal documentation Forget realms and realms of papers and never-ending forms. All you need is a few documents like PAN card, driving license etc and basic information to be filled in the loan application form. Most of the formalities can be completed while you are in the store choosing your favourite consumer durable. Part Prepayment facility You can prepay upto 6 times in a calendar year at any interval with the minimum amount per prepay transaction being not less than 3 EMIs. There is no limit on the maximum amount. This is subject to your clearing your first EMI. Preapproved offers As our existing privileged customer, you will get special pre-approved offers from time to time.

ABSTRACT:

Consumer durable financing is highly influenced by demographic factors, the demographic variables such as Age, Gender, Marital status, Income, Education affect the purchasing behaviour of customers. Distribution of population with reference to location such as rural, urban, semi-urban also has an impact on purchasing behaviour. Marketers can make better marketing decisions only when they know why and how individuals make their consumption decisions. If marketers are able to understand the behaviour of company precisely, they could consumers are likely to react to various informational and environmental aspects and could shape their marketing strategies in such a way that they can achieve a great competitive advantage in the market. The objective of the study is find out the important factors which influence the consumer loan purchases and their perception towards lenders with special reference to Bajaj FinServ.ltd.

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Chapter II

REVIEW OF LITERATURE:

CORPORATE CATALYYST INDIAs research on consumer behaviour financing reports that customers who are seeking finance are conscious about interest being charged for white goods there is perceptible shift towards low cost financing schemes. Indias consumer market is riding the crest of the countrys economic boom. Driven by a young population with access to disposable incomes and easy finance options, the consumer market has been throwing up staggering figures. The market share of MNCs in consumer durables sector is 65 per cent. MNC's major target is the growing middle class of India. MNCs offer superior Technology to the consumers whereas the Indian companies compete on the basis of firm grasps of the local market, their well acknowledged brands, and hold over wide distribution network. India officially classifies its population in five groups, based on annual household income (based on year 1995-96indices). These groups are: Lower Income; three subgroups of Middle Income; and Higher Income. Household income in the top 20 boom cities in India is projected to grow at 10 per cent annually over the next eight years, which is likely to increase consumer spending on durables. With the emergence of concepts such as quick and easy loan, zero equated monthly installment (EMI) charges, loan through credit card, loan over phone, it has become easy for Indian consumers to afford more expensive consumer goods.

Key Industry Dynamics Industry Size Key Categories : Rs. 350 billion : White Goods, Brown goods and Consumer electronics.

Competitive landscape: Dominated by Korean majors like LG and Samsung in most of the segments Margin Profile : Low margin, dependant on volumes

Growth opportunities : Lower penetration coupled with increasing disposable income

Based on study of Ali Hortasu (Department of Economics, University of Chicago and NBER), GregorMatvos(University of Chicago Booth School of Business & NBER), Chad Syverson (University of Chicago Booth School of Business and NBER) and SriramVenkataraman (UNC Kenan-Flagler Business School) financial distress affects consumer markets in a profound manner. The Durable goods channel is a potentially important source of indirect costs of financial distress. Domestic durable goods manufacturers alone account for about 7 percent of U.S. value added, and many other products and services have long-lived durable-like elements in their provisions, making them subject to the mechanism described above. Automobiles, the specific subject of our study, represent a significant fraction of household wealth. They account for about 5 percent of consumption in the U.S.and are the nonfinancial asset most commonly held by households (Bucks et al. (2009)). Prima facie evidence suggests the mechanism does in fact operate in the auto industry: In a 2006 survey, 23 percent of consumers who avoided the Big 3 (more recently referred to as the Detroit 3) brands listed those companies financial conditions as a reason for avoidance (J.D. Power (2006)). Moreover, despite the lack of evidence, policy programs aimed at helping U.S. car manufacturers were based on the premise oflargeindirect costs of financial distress, through warranties in particular. Measuring the size of any such effect is empirically challenging, however. While financial distress can reduce the demand for durable goods, causality can also operate in the opposite direction: negative demand shocks affect firms cash flows and therefore can induce financial distress. This generic problem has plagued the literature on the effects of financial distress and indirect costs of bankruptcy, whether these indirect costs are from the consumer, supplier, or employee side.Our study, besides focusing on an inherently interesting set of products and firms, can avoid many of these identification issues.

We study the effect of financial distress on the prices of used cars in car auctions conducted by a major car auction house in the United States from January 1, 2006 to November 14, 2008. We compare shifts in the prices of a manufacturers cars to a measure of that manufacturers likelihood of bankruptcy. As we discuss below, we believe our data is rich enough to provide sources ofidentification of the links between cars values and their manufacturers financial distress that are unlikely to be driven by reverse causation, where price drops lead to distress rather than vice versa. Looking for such effects in used car auctions holds several advantages over new car markets.Wholesale car markets are very liquid; prices can rapidly adjust to changes in the economic environment.Their decentralized nature makes them less exposed to strategic pricing, and their participants are autodealers who are knowledgeable about the product and the final demand environment. Additionally, unlike a drop in new car prices, a decrease in used car prices does not directly affect manufacturers cash flows, decreasing the potential for reverse causality. Titman (1984)& researchers have reportedthat during boom period consumer durable buyers do not care about high interest cost lending whereas during recession lower interest costs are mandatory to increase the white good . In consonance with the global trend, over the years, demand for consumer durables has increased with rising income levels, double-income families, changing lifestyles, availability of credit, increasing consumer awareness and introduction of new models. Products like air conditioners are no longer perceived as luxury products.

Strategy Drivers :
Focus on Existing Customers Perpetual State of Beta Invest Deep in Technology Build Partnerships with the Best in the World

Research Publication :

VALUEDITION
VALUEDITION our flagship publication is a detailed monthly review of various savings and investment products. Written and compiled by a qualified team of investment professionals, VALUEDITION provides insights on global and domestic macro-economic events and their impact on various asset classes. It provides a snapshot of the investment research carried out by Bajaj Finserv Wealth Management on various types of mutual funds and small savings instruments. It also carries scientifically designed and regularly monitored sample asset allocation models to suit different types of individual investment risk profiles and time horizons. The VALUEDITION is intended to serve as a tool that would help our customers make informed investment decisions after understanding how various financial products behave in isolation and how they behave together when woven into a portfolio.

VALUEADD
VALUEADD our monthly publication is a concise eight page review of the investment environment and the performance of various types of asset classes and mutual fund products. The VALUEADD is intended to provide a quick look through for customers and prospects to determine if their savings and investments are on track.

Our Process

Portfolio Summary We are the most diversifed non-bank in the country, the largest financier of consumer durables in India and one of the most profitable firms in the category. Hereunder are summary details of our portfolio of businesses, with a brief description on each. Consumer Durables Finance Lifestyle Finance EMI Card Consumer Finance Personal Loans Cross Sell Co-branded Credit Cards Two and three wheeler Finance Salaried Personal Loans

Mortgage SME Finance Business Loans

Construction Equipment Finance Commercial Lending Infrastructure Finance Vendor Financing

COMPANY PROFILE: Bajaj Finserv Limited (Bajaj Finserv) is a holding company. Bajaj Finserv Ltd is a financial services company which is engaged in life insurance, general insurance, consumer finance and other Financial products. Apart from financial services, the company is also active in wind energy generation. Bajaj Finserv Ltd was incorporated on April 30, 2007. The financial services and wind energy businesses were transferred to Bajaj FinServ Ltd as part of the demerger of Bajaj Auto Ltd. The demerger is effective from the appointed date on March 31, 2007. The portfolio of the company includes 74% in the two insurance companies namely Bajaj Allianz Life Insurance company Ltd and Bajaj General Insurance company Ltd, 50% holding in Bajaj Allianz Financial Distributors Ltd, 40.53% in Bajaj Auto Finance Ltd and 100% holding in Bajaj Financial Solutions Ltd. The company is engaged in life and general insurance through their joint ventures with Allianz SE namely balaji Allianz Life Insurance Company Ltd and Bajaj Allianz General Insurance Ltd. Bajaj Allianz Financial Distributors Ltd is a 50:50 joint venture company between the company and Allianz SE which is engaged in the business of financial products. The company operates 138 wind mills in Maharashtra with an installed capacity of 65.2 MW. It does lending business Under Bajaj Finance Limited (BFL). Its protection business consists of life insurance, under the Bajaj Allianz Life Insurance Company (BALIC), and general insurance, under the Bajaj Allianz General Insurance Company (BAGIC). The Companys Financial Advisory and Wealth Management busines s consists of Bajaj Financial Solutions Limited (Bajaj Finsol), which offers financial products and advises clients on financial and wealth management. Bajaj Auto Finance Ltd offers various consumer finance products to the customers such as auto loans, personal loans, loans for consumer durables and computers and SME finance.

Competitors comparision:

BIBLIOGRAPHY Company profile by www.bajajfinservlending.in with some facts about the company Process of work flow , documentation and ideas by practical experience in On Job Training at Bajaj Finserv lending

QUESTIONNAIRE Whats the reason of loosing the other customers to future capital & Shriram ? And why cant we offer those schemes to attract the customers? What are the stood the ways, that we can adopt those schemes? What is the drawback that the company is facing as of now? How to rectify those? What are the offers that we can still come up with? Will social website for Bajaj will improve the workers efficiency? If so how ? How to improve the financial activity?