Farsight projrct report

PROJECT REPORT
2012 Submitted for the partial fulfillment of the requirement for the award Of POST GRADUATE DIPLOMA IN MANAGEMENT SUBMITTED BY SHUBHAM SRIVASTAVA
110038

UNDER THE SUPERVISION OF

External: Neha Tiwari Internal: Amitabh sir

Department of Management

INSTITUTE OF MANAGEMENT EDUCATION, SAHIBABAD

PROJECT REPORT
2012 Submitted for the partial fulfillment of the requirement for the award Of POST GRADUATE DIPLOMA IN MANAGEMENT SUBMITTED BY SHUBHAM SRIVASTAVA
110038

UNDER THE SUPERVISION OF

External: Neha TIWARI Internal: Amitabh

Department of Management

INSTITUTE OF MANAGEMENT EDUCATION, SAHIBABAD

DECLARATION

I hereby declare that the project report entitled" ANALYSIS OF AWARENESS AMONG INVESTORS REGARDING ONLINE TRADING AND DEMAT A/C submitted for the Post Graduate Diploma in Management is my original work and the Project Report has not formed the basis for the award of any degree, diploma, associateship, or other similar titles.

Date Place Signature

INSTITUTE OF MANAGEMENT EDUCATION

G. T. Road, Sahibabad, Ghaziabad (U.P.)

DEPARTMENT OF MANAGEMENT
CERTIFICATE

This is to certify that the Summer Training Project titled ANALYSIS OF

AWARENESS AMONG INVESTORS REGARDING ONLINE TRADING AND DEMAT A/C submitted By SHUBHAM SRIVASTAVA (110038) for
the partial fulfillment of the requirements of PGDM (Batch 2011-2013), embodies the bonafide work done by him/her under my supervision.

______________________ Signature of the Guide

Place: _____________________

ACKNOWLEDGMENT

I express my sincere gratitude to the management of ESCORTS SECURITIES LTD. for providing me material to prepare my project on their esteem organization. I would like to thanks Mr. Avinash Tiwari (branch manager) who has been a constant source of inspiration and my special thanks to Dr Neha Tiwari (project guide) from the institute) for her extensive guidance, cooperation and support. Finally, I wish to express my gratitude to all those who have in one way or other helped me in the successful completion of my project report. The Project was completed successfully with the valuable cooperation of companys personnel.

EXECUTIVE SUMMARY
Escorts Securities Ltd. (ESL), with the pedigree of the Escorts Group, was created to fill the vacuum in securities market in 1994.Headquartered at Delhi, the company has large network of branches all over India. The company is a member of National Stock Exchange of India Ltd. (NSE) in cash as well as Futures & Options (F&O) segment. ESL is also a member of National Securities Depositary Ltd. (NSDL) and a Category I Merchant Banker. ESL offers an entire gamut of financial services relating to equities, debt, depositary, futures and options, IPOs and Mutual Fund. The company offers sub-syndicator services to its investors to benefit from IPOs in book built basis Financial services have been one of the most dynamic forays of the group in response to the changing times. With a strong manufacturing base, worldwide alliances and wide network, Escorts has made a mark for itself in this area of business. ESL is adequately equipped to deliver total customer satisfaction in alltheseareas. The epitome of security and stability, Escorts in one of India's largest and most diversified engineering groups. Its diverse activities include agricultural mechanization, construction equipment and auto & railway ancillaries. Having pioneered farm mechanization in the country, Escorts has played a pivotal role in the agricultural growth of India for over five decades. In the over six decades of our inception, Escorts has been much more than just being one of India's largest engineering companies. It has been a harbinger of new technology, a prime mover on the industrial front, at every stage introducing products and technologies that helped take the country forward in key growth areas. Following the globally accepted best manufacturing practices with relentless focus on research and development, Escorts is today in the league of premier corporate entities in India.

As per the title suggest the project report has been prepared on the awareness among investors regarding demat a/c & online trading in India. Online trading was initiated by NSE in India and soon after the other exchanges also followed it. There was a major boom in yr. 2000 when lots of online trading companies came with a bang but only few were survived because of lack of computer knowledge and low internet penetration. There are two types of online trading companies one is the banking online trading companies and the other is non-banking trading. A few examples of banking online trading companies are HDFC securities, ICICI direct.com, UTI securities etc.

On the other hand non banking trading companies are sharekhan.com, Angel Broking, Reliance Money , Escorts securities ltd, etc. Today online trading contributes are about 8-10%. It is continuously growing and has a huge market potential. A study was undertaken to determine the growth of various online trading companies in India in terms of trade done by them through online and services provided by them.

TABLE OF CONTENTS

Introduction to online trading & demat a/c.1 Research Design...8 Company Profile .................................................................15 Depositories44 Competitive analysis77 Marketing problems.83 Analysis and Interpretation..86 Future line of research..104 Finding....106 Conclusion..108 Suggestion..110 References...........................................................................112 Appendix .............................................................................113 Biblography..116

OVERVIEW OF CHAPTER SCHEME

CHAPTER 1: Introduction to demat a/c & online trading.

CHAPTER 2: Research Design - Introduction, title of the study, statement of the problem, objectives of the study, research methodology, sampling, plan of analysis, study area and limitations of the study.

CHAPTER 3: Company Profile Introduction to Escorts, .Escorts securities in india, vision and core values, Board of Directors in escorts , parteners, introduction of stock market. Chapter4Depositories of India

CHAPTER 5: Competitive analysis Information about the financial products offered by escorts and other private companies in India

CHAPTER 6: Marketing problems - The techniques used by stock market and their advantages and disadvantages along with suggestions for improvement.

CHAPTER 7: Analysis and Interpretation A MARKET SURVEY on the securities in India.

CHAPTER 8: Problems requiring more research Future line of work CHAPTER 9: Finding CHAPTER10: Conclusion

References

Appendices

Biblography

CHAPTER I

DEMATS & ONLINE TRADING

AN OVERVIEW

THE STOCK EXCHANGES IN INDIA

AN OVERVIEW
STOCK EXCHANGES :

The investor wants liquidity for their investments. The securities, which they hold should easily be sold when they need cash. Similarly, there are others who want to invest in new securities. There should be a place where the securities need to be sold and purchased. Stock Exchanges provide a place where securities of different companies can be purchased and sold. Stock Exchange is a body of persons, whether incorporated or not formed, with a view to help, regulate and control the business of buying and selling securities . Stock Exchanges are organized and regulated markets for various securities issued by corporate sector and other institutions. The stock Exchanges enable flexible purchase and sale of securities as commodity exchanges allow trading in commodities. Stock Exchanges are an integral part of nation's economic life. They operate by holding the responsibility of mobilizing savings of small and big investors and allocating them to the business firms and for the entrepreneurs, towards productive investment. The following definitions explain the meaning and scope of Stock exchanges. Definition: According to the securities contract act, 1956 Stock Exchange means any, body of individuals, whether incorporated or not, constituted for the purpose of assisting, regulating or controlling the business of buying and selling in securities"

SECURITIES AND EXCHANGE BOARD OF INDIA (SEBI): Recommendations of Narasimham committee as well as of other committees and groups pointed out a number of shortcomings in the functioning of stock markets in India, such as long delays, lack of transparency in procedures, vulnerability to price rigging and inside trading. To counter these shortcomings, Securities and Exchange Board of India (SEBI) was initially established as a nonstatutory body in April 1988 for 1. Dealing with all matters relating to the development and regulation. 2. Providing investor protection. 3. Advising the government on all these matters. SEBI was given statutory status by an Act of Parliament on April 4, 1992. SEBI was authorized 1. To regulate all merchant banks on issue activity. 2. To lay guidelines, and supervise and regulate the working of mutual funds and 3. To oversee the working of Stock Exchanges in India. Functions of SEBI: Under the SEBI Act, SEBI has been assigned the following main functions; 1. Regulating the business in Stock Exchanges and other securities markets. 2. Registering and regulating the working of stock-brokers, sub-brokers, share transfer agents, banker to an issue, trustees of trust deals, registrars to an issue, merchant bankers, underwriters ,portfolio managers, and other intermediaries associated with the securities markets. 3. Registering and regulating of collective investment schemes including mutual funds. 4. Promoting and regulating the working of self-regulatory organizations. 5. Prohibiting fraudulent and unfair trade practices relating to securities market. 6. Promoting investors education and training of intermediaries of Securities market 7. Prohibiting insiders trading in securities 8. Regulating substantial acquisition of shares and takeover of companies.

Recent developments in Secondary Market and role of SEBI in regulating the markets: The century-old Indian capital market is two steps forward and one step back, or vice-versa, but whatever may be the phrase, according to some surveys made recently, it is found that though Indian capital market is firmly on the road to renewed growth, the investor's confidence is totally shattered and the SEBI's reformist's will did not find much favor to investors, in restoring their faith in the capital market. Since 1995-96, SEBI has been showing its reformist will in more than one way. Several measures in conjunction with the stock exchanges were introduced by SEBI, for safeguarding the investor's interests by ensuring better transparency and efficiency of markets. Some notes worthy reforms in the capital market introduced by SEBI are as follows: Electronic trading Demat trading Stock trading Stock watch surveillance system Fast clearance of investigation Levy of heavy penalty of defaulting brokers Buy back of shares by the corporate Compulsory rolling settlement Swadeshi EDGAR (Electronic Data Gathering, Analysis and Retrieval) etc The constitution of SEBI has heralded a new era in the Indian Capital market with its heavy agenda To protect the interest of investors To promote and regulate the securities market by regulating the business in stock exchanges To regulate the working of stock brokers, merchant bankers and other intermediaries To regulate the working of depositories and participants To regulate the working of venture capital funds and mutual funds To prohibit the fraudulent and unfair trade practices To promote invests education and to train intermediaries To prohibit insider trading in securities NATIONAL STOCK EXCHANGE: The National Stock Exchange was set up by IDBI and other financial institutions in Bombay in 1993. It was recognized by the Government in the same year and the exchange started wholesale debt market in June 1994 and equity trading in November 1994. The wholesale debt market or the money market segments would cater to banks, FII's etc. to encourage high value transactions in PSU bonds, Units, treasury bills, Govt. securities and call money. There is no trading floor of the exchange.Trading is done on computer with the help of PC terminals in

broker's offices. The capital market segment is also similarly on computer based trading. The settlement was earlier on T+5 bases but is changed to T+3 bases from 1st April. Benefits accrue to both issuers and investors. As this is screen based trading with national network, transparency and cost effectiveness is ensured. Besides, the investment counters can be spread wide in the country under the NSE electronic network. More than 3000 companies are already listed on NSE. Trading in them is continuing simultaneously with those in the principal and regional stock exchanges. NSE became the first exchange to grant approval to its members for providing internet based trading services. Internet trading is possible on both the Equities as well as the Derivatives segments of NSE. Characteristics: The characteristics of national market system are as follows: 1) Completely automated system in terms of both trading and settlement procedures to be provided through the Securities Facilities Support Corporation. 2) Compulsory market makers to provide liquidity and ready market. 3) The members would be as large as 1000 and corporate and institutional members would also be there, drawn from various parts of the country and to represent the professionals on all India basis. 4) Only medium sized companies and PSUs are expected to be listed on this exchange and it will complement the existing exchanges. 5) The NSE would have a separate trading facility and time allotted for debt instruments in order to have beneficial effect of creating on active secondary market in debt instruments. 6) National clearing and settlement system for making settlement on national basis. 7) The central depository trusts to keep physical custody of shares and to usher in scrip less trading system. 8) The securities facilities support corporation for providing supporting infrastructure facilities Objectives: The objectives of the NMS are as follows: 1. To help the privatization of public sector units through listing of their shares on this exchanges. 2. To spread the investment habit and cult the savers in the rural and semi-urban areas as well. 3. To professionalize the members with a view to improve the investor services. 4. To create more employment opportunities in the service sector within the orbit of capital market.

NSE set-up: The National Stock Exchange has set up facilities, which serve as a model for the securities industry in terms of trading systems, practices and procedures. NSE is different from most stock exchanges in India where membership on a exchange also meant

ownership of the exchange. The ownership and the management of the Exchange is completely separated from the right to trade. The Exchange is managed by a Board of Directors. The Board to an Executive Committee, which includes representatives from the Trading Members, the public and the management, delegates decisions relating to market operations. Besides, the Exchange operates various committees to advise it on areas such as good market practices, settlement procedures, risk containment systems etc.

Formation of the National Stock Exchange (NSE):

With the liberalization of the Indian economy, it was found inevitable to lift the Indian stock market trading system on par with the international standards. On the basis of the recommendations of high-powered Pherwani Committee, the National Stock Exchange was incorporated in 1992 by Industrial Development Bank of India, Industrial Credit, and Investment Corporation of India, Industrial Finance Corporation of India, all Insurance Corporations, selected commercial banks and others.

Trading at NSE can be classified under two broad categories :

(a) Wholesale debt market and (b) Capital market. Wholesale debt market operations are similar to money market operations institutions and corporate bodies enter into high value transactions in financial instruments such as government securities, treasury bills, public sector unit bonds, commercial paper, certificate of deposit, etc.

There are two kinds of players in NSE:

(a) Trading members and (b) Participants. Recognized members of NSE are called trading members who trade on behalf of themselves and their clients. Participants include trading

members and large players like banks who take direct settlement responsibility. Trading at NSE takes place through Trading at NSE takes place through a fully automated screen-based trading mechanism, which adopts the principle of an order-driven market. Trading members can stay at their offices and execute the trading, since they are linked through a communication network. The prices at which the buyer and seller are willing to transact will appear on the screen. When the prices match the transaction will be completed and a confirmation slip will be printed at the office of the trading member.

NSE has several advantages over the traditional trading exchanges. They are as follows:
NSE

brings an integrated stock market trading network across the nation. can trade at the same price from anywhere in the country since

Investors

inter-market operations are streamlined coupled with the countrywide access to the securities.
Delays

in communication, late payments and the malpractices prevailing

in the traditional trading mechanism can be done away with greater operational efficiency and informational transparency in the stock market operations, with the support of total computerized network. Unless stock markets provide professionalized service, small investors and foreign investors will not be interested in capital market operations. And capital market being one of the major sources of long-term finance for industrial projects, India cannot afford to damage the capital market path. In this regard NSE gains vital importance in the Indian capital market system.

Why people trust NSE? Unbiased:

The National Stock Exchange of India (NSEIL) has been trusted by the securities markets for its unbiased independence and professionalism. The function of forecasting has become more meaningful as the information comes from a source, which is not only reliable but has no vested interest of its own in the market movements.

Market Representation:
NSE-MIBID/MIBOR is based on rates polled by NSE from a representative panel of 31 banks/institutions/primary dealers.

Transparent:
The reference rate is released to all the market participants simultaneously through various media, making it transparent with the aspiration of the market. Ensuing transparency helps the market participants to judge the market mood and the probable rate one is likely to encounter in the market. This information is useful not only to the banks but also to the issuers and investors.

Reliable:
The high level of co-relation between actual deals and the reference rate gives an indication of its reliability. The bootstrapping technique guards against the possibility of cartelization and of extreme observations influencing the mean

Scientifically Computed:
The methodology of "Polling" with "Bootstrapping" is scientific and the values are generated through a system that has been extensively tested. The technique involves generating multiple data sets based on the rates polled with a dynamically determined number of iterations, identification of

outliers, trimming the data set of its extreme values and computation of the mean and its standard deviation.

Elimination of Noise:
The trimming procedure is vulnerable to market manipulation of the rates due to the amount of sampling noise. Excessive trimming may lead to loss of information whereas no trimming may lead to excessive influence of the extreme values. To derive a true representative benchmark for the market NSE ensures that trimming at any point does not exclude more than 20% of the observation for the bid and for the ask rates.

Consistency:
The Exchange ensures that everyday the NSE-MIBID/MIBOR along with the respective standard deviations are disseminated to the market at 0955 (IST) for overnight rate and at 1215 (IST) for 14 day, 1 month and 3 month rates.

Usage:
The NSE-MIBID/MIBOR rate is used as a bench mark rate for majority of deals struck for Interest Rate Swaps, Forward Rate Agreements, Floating Rate Debentures and Term Deposits.

1.6 Investment Scenario in India:

Investments, unlike works of art, cannot afford the luxury of experimenting. Investing is not guesswork. It takes more than just a tip; it needs training to plan, instinct to pick and sheer intellect to make it work for the investor. Human nature is capricious, his wants keep changing. Many individuals find investments to be fascinating because they can participate in the decision making process and see the results of their choices. Not all investments will be profitable, as investor wills not always make the correct investment decisions over the period of years; however, you should earn a positive return on a diversified portfolio. In addition, there is a thrill from the major success, along with the agony associated with the stock that dramatically rose after you sold or did not buy. Investing is not a game but a serious subject that can have a major impact on investor's future well being. Virtually everyone makes investments. Even if the individual does not select specific assets

such as stock, investments are still made through participation in pension plan, and employee saving program or through purchase of life insurance or a home. Each of this investment has common characteristics such as potential return and the risk you must bear. The future is uncertain, and you must determine how much risk you are willing to bear since higher return is associated with accepting more risk. The individual should start by specifying investment goals. Once these goals are established, the individual should be aware of the mechanics of investing and the environment in which investment decisions are made. These include the process by which securities are issued and subsequently bought and sold, the regulations and tax laws that have been enacted by various levels of government, and the sources of information concerning investment that are available to the individual. An understanding of this financial background leads to three important general financial concepts that apply to investing. Today the field of investment is even more dynamic than it was only a decade ago. World event rapidly-events that alter the values of specific assets the individual has so many assets to choose from, and the amount of information available to the investors is staggering and continually growing. An investment can be described as perfect if it satisfies all the needs of all investors. So, the starting point in searching for the perfect investment would be to examine investor needs. If all those needs are met by the investment, then that investment can be termed the perfect investment.

History of Stock Market

Indian Stock Markets are one of the oldest in Asia. Its history dates back to nearly 200 years ago. The earliest records of security dealings in India are meager and obscure. 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. Though the trading list was broader in 1839, there were only half a dozen brokers recognized by banks and merchants during 1840 and 1850.

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. In 1860-61 the American Civil War broke out and cotton supply from United States of Europe was stopped; thus, the 'Share Mania' in India begun. The number of brokers increased to about 200 to 250. However, at the end of the American Civil War, in 1865, a disastrous slump began (for example, Bank of Bombay Share which had touched Rs 2850 could only be sold at Rs. 87). In 1887, they formally established in Bombay, the "Native Share and Stock Brokers' Association" (which is alternatively known as "The Stock Exchange"). In1895, the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. Thus, the Stock Exchange at Bombay was consolidated. Thus in the same way, gradually with the passage of time number of exchanges were increased and at currently it reached to the figure of 24 stock exchanges.

HISTORY OF ONLINE TRADING: Online stock trading is very old concept for big institutions who trade thru private networks owned by Reuter's "Instinet" and a system called "Posit" since 1969. But it becomes internet based for lay men only in late 90s.

Funny, that actually idea was first time used by a company making Beer called "WIT beer" to help its shareholders trade its shares. Thats how "WIT Capital" was born which is considered pioneer of this concept. It was made mainstream and household name by a offshoot of Charles Schwab & Co called eschwab which is used by millions of people in USA. Lot of NRI's i know play in US stock market even when they come to India for holidays via website of eschwabe. There are other serious players like E*trade, DATEK online etc. All this companies ask you to start account with US $5000 and you can buy and sell stock using these funds. They also issue you a check book which you can use to make payments from this account. Or use their ATM card to withdraw cash from your stock trading account. Today practically every big name brokerage firm offers online stock trading as it reduces their costs. Earlier they had army of brokers on phone with clients executing trade, which is done by computers accepting orders from clients directly. This firm now offers human access to high net worth accounts, and to rest at charge per trade. OBJECTIVES OF INTERNET TRADING Increase transparency in the markets. Enhance market quality through improved liquidity, by increasing quote continuity and market depth. Reduce settlement risks due to open trades, by elimination of mismatches. Provide management information system (MIS). Introduce flexibility in system, to handle growing volumes easily and to support nationwide expansion of market activity.

Overview of Demat Account :

Demat account allows you to buy, sell and transact shares without the endless paperwork and delays. It is also safe, secure and convenient. In India, a demat account, the abbreviation for dematerialized account, is a type of banking account which dematerializes paper-based physical stock shares. The dematerialized account is used to avoid holding physical shares: the shares are bought and sold through a stock broker. This account is popular in India. The Securities and Exchange Board of India (SEBI) mandates a demat account for share trading above 500 shares. As of April 2006, it became mandatory that any person holding a demat account should possess a Permanent Account Number (PAN), and the deadline for submission of PAN details to the depository lapsed on January

2007

DEMAT BENEFITS:
A safe and convenient way to hold securities. immediate transfer of securities. No stamp duty on transfer of securities(0.5 % on physical shares). Elimination of risks associated with physical certificates such as bad delivery, fake securities , delays , theft etc. Reduction in paper work. Reduction in transaction cost. No odd lot problem , even one share can be sold.

DEMAT Conversion :-

1. Surrender

the certificates of physical shares for dematerialization to your participant intimates depository of the request through the participant submit the certificates to the registrar to the issuer

depository participants.
2. Depository

system.
3. Depository

company.
4. Registrar 5. After

confirms the dematerialization request from depository.

dematerializing the certificates, registrar updates accounts and

informs depository of the completion of dematerialization.

6. Depository 7. Depository

updates its accounts and informs the depository participant. participant updates demat a/c of the investor.

Is a demat account a must?

Now a day, practically all trades have to be settled in dematerialized form. Although the market regulator, the Securities and Exchange Board of India (SEBI),has allowed trades of up to 500 shares to be settled in physical form, nobody wants physical shares any more. So a demat account is a must for trading and investing.

Why demat?
The demat account reduces brokerage charges, makes pledging/hypothecation of shares easier, enables quick ownership of securities on settlement resulting in increased liquidity, avoids confusion in the ownership title of securities, and provides easy receipt of public issue allotments.

It also helps you avoid bad deliveries caused by signature mismatch, postal delays and loss of certificates in transit. Further, it eliminates risks associated with forgery, counterfeiting and loss due to fire, theft or mutilation. Demat account holders can also avoid stamp duty (as against 0.5 per cent payable on physical shares), avoid filling up of transfer deeds, and obtain quick receipt of such benefits as stock splits and bonuses.

What is dematerialization?
Dematerialization is the process by which physical certificates of an investor are converted to an equivalent number of securities in electronic form and credited into the investors account with his/her DP.

INTRADAY:
The day to day buying and selling or daily transactions are called as Intraday. You have to buy or sell the shares within the day only.

DELIVERY:
It is the three day transaction. The day you buy the share and the next two days after that day is called as Delivery. It includes thre days. If you are buying any share then you have to sell it within three days including the buying day. T+2 = Today + 2 days Demat a/c Charges: Account Opening Charges: Nil Annual Maintenance Charges: Rs 150

DOCUMENTS NEEDED FOR OPENING DEMAT A/C

Apart from two passport size photographs, one needs to provide with the following documents in order to open an account with Escorts Securities Limited.: Photocopy of the clients PAN Card which should be duly attached Photo copy of any of the following documents duly attached which will serve as correspondence address proof: a. Passport (valid) b. Voters ID Card c. Ration Card d. Driving License (valid) e. Electricity Bill (should be latest and should be in the name of the client)
f. Telephone g. Flat

Bill (should be latest and should be in the name of the client)

Maintenance Bill (should be latest and should be in the name of the Policy (should be latest and should be in the name of the

client)
h. Insurance

client) i. Lease or Rent Agreement. j. Saving Bank Statement** (should be latest)

* Cheques drawn in favour of Escorts Limited, one for the Account

Buying and Selling of Dematerialization

INTRODUCTION:
The procedure for buying and selling dematerialized securities is similar to the procedure for buying and selling physical securities. The difference lies in the process of delivery (in case of sale) and receipt (in case of purchase) of securities.

In case of purchase:The The

broker will receive the securities in his account on the payout day. broker will give instruction to its DP to debit his account and credit will give Receipt Instruction to DP for receiving credit by filling

investors account.
Investor

appropriate form. However one can give standing instruction for credit in to ones accounts that will obviate the need of giving Receipt Instruction every time.

In case of sale:The investor will give delivery instruction to DP to debit his account and credit the brokers account. Such instruction should reach the DPs office at least 24 hours before the pay-in as otherwise DP will accept the instruction only at the investors risk.

Rights
1.Dematerialized securities can be traded on those stock exchanges connected to NSDL. At present, NSE, BSE, CSE, DSE, LSE, OTCEI etc are connected to NSDL. At these stock exchanges, two segments

would be available to trade in dematerialized securities :

o

Unified (erstwhile physical) segment - In this segment delivery

obligation can be met by delivering dematerialized or physical securities at the option of the seller. However, for a select list of securities prescribed by SEBI, securities cannot be delivered in physical form in the unified segment, of stock exchanges connected to NSDL. This list presently covers 160 securities. This list has been expanded to cover a total of 200 securities with effect from January 17, 2000. Over a period, this list would cover all actively traded securities.
o

Exclusive demat segment - In this segment delivery obligation

can be met by delivering dematerialized securities only. Physical securities cannot be delivered in the exclusive demat segment.

Procedure
Trading in dematerialized securities is done through your broker just like trading in physical securities. After your broker executes the trade, your DP will help to deliver shares to your broker (in case you sell) on the basis of valid instruction given by you to your DP and receive shares from your broker (in case you buy) on basis of valid instruction given by your broker to his DP.

Buy dematerialized securities

1.You purchase securities in any of the stock exchanges connected to NSDL through a broker of your choice and make payment to your broker. Make sure you tell your broker you want only demat shares. 2.Broker arranges payment to clearing corporation/ clearing house of the stock exchange.

3.Broker receives credit in his clearing account with his DP on the pay-out day. He can immediately transfer these securities to your depository account, provided your account is already active. 4.Broker gives instructions to his DP to debit his clearing account and credit your depository account. 5.You give instruction to your DP for receiving credit in your depository account. If you have given standing instruction to receive credits, no separate instruction for receiving credit will be required. 6.If the instructions match, your account with your DP is credited.

Sell dematerialized securities

1.You sell your dematerialized securities in any of the stock exchanges linked to NSDL through a broker of your choice. 2.You give instruction to your DP for debit of your depository account and credit of your brokers clearing member account at least 24 hours i.e. one working day prior to the pay-in date or before the deadline prescribed by your DP, so that your brokers clearing account is credited at the time arranged with him. 3.On the pay-in day, your broker gives instruction to his DP for delivery to clearing corporation/clearing house of the relevant stock exchange. 4.The broker receives payment from the clearing corporation / clearing house.
5.You

receive payment from the broker for the sale in the same manner you

would receive payment for a sale in the physical mode.

Points To Remember
1.Trading continues to be through brokers. In case of any problem in

execution of trade, contact your broker and if he fails to resolve the problem you may contact the stock exchange. 2.When you buy securities through the stock exchange, your brokers clearing account is credited to the extent of the securities purchased, on receipt of instruction from clearing corporation/ clearing house of the stock exchange. Your depository account is credited only when your broker gives a delivery instruction to his DP. Securities are not directly credited to your account by the clearing corporation/ clearing house of the stock exchange. In case your broker does not give a delivery instruction, contact him or concerned stock exchange or SEBI. If your depository account is not credited, in spite of your broker giving valid instruction to his DP, contact the DP and if he fails to resolve the same you may contact NSDL.
3.When

you sell securities, you have to give a delivery instruction to your

DP to transfer the securities to your brokers clearing account. They are not automatically debited from your account by NSDL or by the clearing corporation/ clearing house of the stock exchange. In case the DP defaults in executing your instruction, the DP is liable to compensate you for the loss incurred, provided your instruction was in order and has been submitted to the DP at least 24 hours i.e. one working day prior to the payin date or before the deadline prescribed by DP. In case the DP fails to resolve your problem, you can contact NSDL.

Need for the Study

The need of the study arises because of the reason that a trainee must understand the company, its achievements and tasks, products and services and also to collect information about its competitors, its products and services offered. So that, after understanding and collecting information about the organization and its competitors, a trainee will be able to work well for the organization. From the study we have learned very much, about the company as well as the strategy of the customers, which helps us a lot at our working days.

TRANSACTION CYCLE
Decision to trade funds or securities Placing Order

settlement of trades clearing of trade

Trade Execution

A person holding assets (Securities/Funds), either to meet his liquidity needs or to reshuffle his holdings in response to changes in his perception about risk and return of the assets, decides to buy or sell the securities. He selects a broker and instructs him to place buy/sell order on an exchange. The order is converted to a trade as soon as it finds a matching sell/buy order. At the end of the trade cycle, the trades are netted to determine the obligations of the trading members securities/funds as per settlement cycle. Buyer/seller delivers funds/ securities and receives securities/funds and acquires ownership of the securities. A securities transaction cycle is presented above. Just because of this Transaction cycle, the whole business of Securities and Stock Broking has emerged. And as an Transaction Cycle extension of stock broking, the business of Online Stock broking/ Online Trading/E-Broking has emerged. At the end of the American Civil War, the brokers who thrived out of Civil War in 1874, found a place in a street (now appropriately called as Dalal Street) where they would conveniently assemble and transact business. In 1887, they formally established in Bombay, the "Native Share and Stock Brokers' Association" (which is alternatively known as The Stock Exchange "). In 1895, the Stock Exchange acquired a premise in the same street and it was inaugurated in 1899. Thus, the Stock Exchange at Bombay was consolidated.

CHAPTER II

RESEARCH DESIGN

RESEARCH DESIGN
INTRODUCTION
A Research Design is the framework or plan for a study which is used as a guide in collecting and analyzing the data collected. It is the blue print that is followed in completing the study. The basic objective of research cannot be attained without a proper research design. It specifies the methods and procedures for acquiring the information needed to conduct the research effectively. It is the overall operational pattern of the project that stipulates what information needs to be collected, from which sources and by what methods.

TITLE OF THE STUDY

ANALYSIS OF AWARENESS AMONG INVESTORS REGARDING ONLINE TRADING AND DEMAT A/C
STATEMENT OF THE PROBLEM

This study was undertaken to identify awareness of online trading & demat a/c among investors in India. A survey was undertaken to understand the awareness of Indian investors with respect to securities market. While marketing financial products asper the needs of investors.

In effect plans (financial products) should be flexible to suit individual requirements. This research tries to analyze some key factors which influence the purchase of securities like equities, derivatives & mutual funds.

OBJECTIVE

1. To study the online trading & demats a/c procedure followed in ESCORTS. 2.To study present online share trading. 3. To find the awareness of Demat account among employed investors. 4. To find out the point of view of investors regarding the services provided by the DP.

5. To discover the investment portfolio that the investors are looking forward to devote into.

RESEARCH METHODOLOGY

TYPE OF DATA COLLECTED

There are two types of data used. They are primary and secondary data. Primary data is defined as data that is collected from original sources for a specific

purpose. Secondary data is data collected from indirect sources. (Source: Marketing Research)

PRIMARY SOURCES
These include the survey or questionnaire method, telephonic interview as well as the personal interview methods of data collection.

SECONDARY SOURCES
These include books, the internet, company brochures, product brochures, the company website, competitors websites etc, newspaper articles etc.

SAMPLING

Sampling refers to the method of selecting a sample from a given universe with a view to draw conclusions about that universe. A sample is a representative of the universe selected for study.

Convenience sampling is used in exploratory research where the researcher is interested in getting an inexpensive approximation of the truth. As the name implies, the sample is selected because they are convenient. This non probability method is often used during preliminary research efforts to get a gross estimate of the results, without incurring the cost or time required to select a random sample. (Source: www.statpac.com)

SAMPLE SIZE

The sample size for the survey conducted was 50 respondents.

SAMPLING TECHNIQUE

Random sampling technique was used in the survey conducted.

PLAN OF ANALYSIS

Tables were used for the analysis of the collected data. The data is also neatly presented with the help of statistical tools such as graphs and pie charts. Percentages and averages have also been used to represent data clearly and effectively.

STUDY AREA
The samples referred to were residing in Lucknow City. .

LIMITATIONS OF THE STUDY

The study was limited only to the city of lucknow

The study was conducted only for a short period of 6 week.

Since the area is not known before it takes lot of time in convincing people to start investing in shares primarily in IPOs.

Some people are comfortable with traditional system: As people are doing trading from there respective brokers, they are quite comfortable to trade via physical form of paper.

Some respondents are unwilling to talk: Some respondents either do not have time or willing does not respond, as they are quite annoyed with the phone call.

CHAPTER III

COMPANY PROFILE

COMPANY PROFILE-- ESCORTS SECURITIES LTD

INTRODUCTION
Escorts Securities Ltd. (ESL), with the pedigree of the Escorts Group, was created to fill the vacuum in securities market in 1994.Headquartered at Delhi, the company has large network of branches all over India. The company is a member of National Stock Exchange of India Ltd. (NSE) in cash as well as Futures & Options (F&O) segment. ESL is also a member of National Securities Depositary Ltd. (NSDL) and a Category I Merchant Banker. ESL

offers an entire gamut of financial services relating to equities, debt, depositary, futures and options, IPOs and Mutual Fund. The company offers sub-syndicator services to its investors to benefit from IPOs in book built basis Financial services have been one of the most dynamic forays of the group in response to the changing times. With a strong manufacturing base, worldwide alliances and wide network, Escorts has made a mark for itself in this area of business. ESL is adequately equipped to deliver total customer satisfaction in all these areas. The epitome of security and stability, Escorts in one of India's largest and most diversified engineering groups. Its diverse activities include agricultural mechanization, construction equipment and auto & railway ancillaries. Having pioneered farm mechanization in the country, Escorts has played a pivotal role in the agricultural growth of India for over five decades. In the over six decades of our inception, Escorts has been much more than just being one of India's largest engineering companies. It has been a harbinger of new technology, a prime mover on the industrial front, at every stage introducing products and technologies that helped take the country forward in key growth areas. Following the globally accepted best manufacturing practices with relentless focus on research and development, Escorts is today in the league of premier corporate entities in India.

HISTORY OF COMPANY

DDate of Establishment RRevenue MMarket Cap CCorporate Address

11944 4454.163 ( USD in Millions ) 117717.3240298 ( Rs. in Millions ) 111 Scindia House, Connaught Circus , New Delhi110001, Delhi www.escortsgroup.com Chairperson Rajan Nanda MD Rajan Nanda Directors - G B Mathur, M G K Menon, Nikhil Nanda, O K Balraj, P S Pritam, Rajan Nanda, S A Dave, S C Bhargava

MManagement Details

FiFInancials

CCompany Secretary BBankers AAuditors F

TTotal Income - Rs. 22042.2 Million ( year ending Sep 2009) Net Profit - Rs. 897.3 Million ( year ending Sep 2009) GG B Mathur SS.N Dhawan & Co

CORPORATE INFORMATION

COMPANY ADDRESS

Company NSE Symbol Website

Es

Escorts Limited ESCORTS www.escortsgroup.com 1 5/5 Mathura Road Faridabad - 12100Faridabad 0129-2250222 0129-2250060 corpsect@ndb.vsnl.net.in SCO-232,FITST FLOOR,SECTOR-20 PANCHKULA Haryana 134109 011-3310145 011-23310271 Corporate Secretariat, 15/5, Mathura Road, Faridabad 121003 ESCORTS SECURITIES LUCKNOW HALL NO.6 SECOND FLOOR SKY HIGH CHAMBER 1 1/5,PARK ROAD LKO 2006001 01292250057/58/2250222/22763 03 EXTN 4275 0129-2250060, 2250064 corpsect@ndb.vsnl.net.in

Transfer Agent

Address Ttelephone Fax Email

Registered Address

Address

Telephone Fax Email Corporate Office Address

Address

Telephone Fax Email

Registered
SCO-232, Sector-20, Haryana First

Office
Floor Panchkula-134109

Corporate
15/5 Phone: Fax: Mathura 0129 Road, 0129 Faridabad 2250058, 121

Centre
003 2250222 2250060

COORPARATE OFFICERS Boardof

Mr. Mr. Nikhil Rajan Nanda, Nanda, Joint Managing

Directors
Chairman Director

Dr. Dr. Dr. Mr.

P S S

S C A

Pritam, Menon, Dave, Bhargava,

Director Director Director Director

Compliance
Mr. Executive Law G and Vice B Company

Officer
Mathur President Secretary

Statutory
M/s Member S Firm N of Dhawan Mazars &

Auditors
Co. Worldwide

Internal
M/s Grant

Auditors
Thornton

KEY EXECUTIVES

S.No 1 3 2 4

Name Rajan Nanda Rajan Nanda G B Mathur M G K Menon

Designation Chairman Managing Director Company Secretary Director

5 6 7 8 9 10 11

S A Dave P S Pritam S C Bhargava Nikhil Nanda G B Mathur O K Balraj O K Balraj

Director Director Director Joint Managing Director Executive Vice President Executive Vice President Group Chief Financial Officer

ABOUT COMPANY STOCK IN MARKET

Financial Year
1st October to 30th September

Listing on Stock Exchanges

The Company's shares are listed at :

1.The National Stock Exchange of India Ltd., Trade World, Senapati Bapat
Marg, Lower Parel, Mumbai - 400 013.

2. The Stock Exchange, Mumbai, Phiroze Jeejeebhoy Towers, Dalal Street,

Mumbai - 400 001

3.Delhi Stock Exchange Association Ltd. DSE House, 3/1, Asaf Ali Road, New

Delhi - 110 002

Stock Code: Name of stock exchange

Stock Exchange, New Delhi Stock Exchange, Mumbai National Stock Exchange, Mumbai

Code No.
00012 500495 Escorts

Security
Equity Shares Equity Shares Equity Shares

MARKET

SHARE

(Liquidity

of

Shares)

The trading volumes at major Stock Exchanges, during the Financial Year 2008-2009, are given below:

National Stock Exchange of India Bombay Stock Exchange Ltd Ltd

Months No. of Value (Rs. in Share Lacs) s 1241.54 881.40 2625.44 No. of Tran sac. 31095 24949 54720 No. of Share s 1176139 926424 2875639 Value No. of (Rs. Tra in nsa Lacs c. ) 511.04 357.43 1177.21 16587 11880 23273

October, 2890641 2008 November, 2344175 2008 December, 6475177

2008 January, 2009 February, 2009 March, 2009 April, 2009 May, 2009 June, 2009 July, 2009 August, 2009 September, 2009 TOTAL

2985114 2089697 7060338 37010265 36138041 37708709 32933535 22770139 55594062 245999893

1186.85 752.31 2649.06 16195.73 19628.74 26510.42 21705.40 16697.82 51638.96

29269 17123 52369 149802 177087 225931 256204 169193 378224

1393113 608540 3355173 21131230 22360889 18950907 21855686 11476358 32275977

560.61 222.96 1270.92 923.07 1220.21 1338.48 1443.80 838.57 3003.51

13098 8072 23561 77981 95925 105587 132367 74866 164109

161713.68 1565966 138386075 12867.81 747306

OBJECTIVE OF COMPANY BY BOARD MEETINGS

Company NSE Symbol

Escorts Limited ESCORTS

Board Meeting Date

Purpose

22-04-2010

The Company has informed the Exchange that Board of Directors of the Company shall inter alia consider and approve Financial Results for the half year ended March 31, 2010 in their meeting scheduled to be held on April 22, 2010. The financial results shall be subject to limited review by the Statutory Auditors of the Company. Unaudited Financial Results for the qtr ended Dec 31, 2009 The Company had informed the Exchange that the meeting of the Board of Directors will be held on December 27, 2009 inter-alia to consider and approve Audited

15-01-2010 27-12-2009

Financial Results for the financial year ended September 30, 2009. The Company has now informed the Exchange that at the said meeting the Board will also consider recommending the declaration of dividend for the Financial Year 2008-09.(Purposed Revised). 27-12-2009 27-07-2009 29-04-2009 20-04-2009 Inter-alia to consider and approve Audited Financial Results for the financial year ended September 30, 2009. To inter alia consider and approve Unaudited Financial Results of the third quarter ended June 30, 2009. The said results shall be subject to a Limited Review by the Auditors. To consider/ approve the merger of its wholly owned subsidiary, Escorts Agri Machinery Inc (USA) with itself and any other consequential matters therein. Inter alia to consider and approve Unaudited Financial Results of the second quarter ended March 31, 2009. The said results shall be subject to a Limited Review by the Auditors. Inter alia to consider and approve Unaudited Financial Results of the first quarter ended December 31, 2008. The said results shall be subject to a Limited Review by the Auditors.

28-01-2009

FINANCIAL RESULTS
Company Escorts Limited NSE SymbolESCORTS Result Period 01-OCT-2009 to 31-MAR-2010 (First Half) Result Type Unaudited, Cumulative, Non-Consolidated

Non Banking
Description Amount(Rs. in Segment Reporting (Rs.lakhs) lakhs ) TOTAL REVENUE 127190.18UNALLOCATE 752.45AUTOANCILR -2331.03 271.35 5512.62 112994.23

Net Sales/Income from Operations Other Operating Income Increase/Decrease in Stock in trade and work in progress

AGRMACHPRD

Consumption of Raw Materials Purchase of traded goods Employees Cost Depreciation Other Expenditure Total Expenditure Profit from Operations before Other Income, Interest & Exceptional Items Other Income Profit before Interest & Exceptional Items Interest Profit after Interest but before Exceptional Items Exceptional items Profit(+)/Loss(-) from Ordinary Activities before tax Tax Expense Net Profit(+)/Loss(-) from Ordinary Activities after tax Extraordinary Items Net Profit (+) / Loss (-) for the period Dividend (%) Face Value (in Rs.) Paid-up Equity Share Capital Reserves excluding Revaluation Reserves Basic EPS before Extraordinary items (in Rs.) Diluted EPS before Extraordinary items (in Rs.) Basic EPS after Extraordinary items (in Rs.) Diluted EPS after Extraordinary items (in Rs.) Public Shareholding (Number of Shares) Public Shareholding (%) Promoter & Promoter group Pledged / Encumbered Number of Shares

82768.22RAILEQUIP 5234.61Total 14031.97 2428.81 16441.57 118574.15 9368.48Net -

10116.66 128894.86 9 5 2 . 2 3

Less: Inter Segment Revenue

Sales/Inc. 127942.63 from Ops.

9368.48RESULTS 363.50AUTOANCILR 9004.98AGRMACHPRD 291.10UNALLOCATE 8713.88RAILEQUIP 2227.00Total 6486.88 -572.68 9716.43 0.00 1638.93 10782.68 3 6 3 . 5 0

Less:
6486.88 10.00 9432.11 136985.71 6.94 6.73 6.94 6.73 65961072.00 69.93 10831334.00

Interest Other unallocable expendit ure net off unallocable income

1 7 0 5 . 3 0

Total

Profit 8713.88 Before Tax

CAPITAL EMPLOYED UNALLOCATE RAILEQUIP AGRMACHPRD

76357.28 10578.67 92264.07 4569.18 183769.20

Promoter & Promoter group Shares Pledged / Encumbered (as a % of total shareholding of Promoter and Promoter Group) Promoter & Promoter group Shares Pledged / Encumbered (as a % total share capital of the company)

38.19

AUTOANCILR Total

11.48

Promoter & Promoter group Number of Shares Non17528702.00 encumbered

Promoter & Promoter group Shares Non-encumbered (as a % of total shareholding of Promoter and Promoter Group) Promoter & Promoter group Shares Non-encumbered (as a % total share capital of the company)

61.81

18.59

CONSUMER STATEMENT SHOWING SHAREHOLDING PATTERN

Sr. Category N of shareholder o

Total number Number of of shar sh ehol are ders s

Number of Total shareholding as shares a Shares pledged or held in percentage otherwise de of total encumbere materi number of d alized shares form % of s h % of shares % No. of a ( r A Number of e + sh s B ar + es ( C A ) + B )

s h a r e s

(A)Shareholding of Promoter and Promoter Group (1)Indian (a) Individuals/ Hindu Undivided Family 26 0 1265465 0 1251051 0 1.34 0.00 1.34 0.00 0 0 0 0

(b) Central Government/ State

Government(s) (c) Bodies Corporate (d) Financial Institutions/ Banks (e) Any Other (specify) 0 Sub-Total (A)(1) (2)Foreign Individuals (Non- Resident Individuals/ Foreign Individuals) 49 0 28360036 0 21878581 0 30.07 0 30.07 0 10831334 0 38.19 23 0 27094571 0 20627530 0 28.73 0.00 28.73 0.00 10831334 0 39.98 0

(a)

0.00

0.00

(b) Bodies Corporate (c) Institutions (d) Any Other (specify)

0 0

0 0

0 0

0.00 0.00

0.00 0.00

0 0

0 0

0 Sub-Total (A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) 0

0 0

0 0

0 0.00

0 0.00

0 0

0 0.00

49

28360036

21878581

30.07

30.07

10831334

38.19

(B)Public shareholding (1)Institutions (a) Mutual Funds/ UTI (b) Financial Institutions/ Banks (c) Central Government/ State Government(s) 37 35 0 0 5 46 0 11726523 4584139 0 0 1627879 20588076 0 11719575 4579052 0 0 1627754 20586688 0 12.43 4.86 0.00 0.00 1.73 21.83 0.00 12.43 4.86 0.00 0.00 1.73 21.83 0.00 NA NA NA NA NA NA NA NA NA NA NA NA NA NA

(d) Venture Capital Funds (e) Insurance Companies (f) (g) Foreign Foreign Institutional Investors Venture Investors Capital

(h) Any Other (specify) 0 Sub-Total (B)(1) (2)Non-institutions (a) Bodies Corporate (b) Individuals Individual (i) shareholders holding nominal share capital up to Rs. 1 lakh shareholders 1425 7837300 7803250 8.31 8.31 NA NA 123 0 38526617 0 38513069 0 40.85 0 40.85 0 NA 0 NA

71830

13093916

10329276

13.88

13.88

NA

NA

(ii) Individual

88

5854631

2332348

6.21

6.21

NA

NA

holding nominal share capital in excess of Rs. 1 lakh (c) Any Other (specify) Non Resident Individual Sub-Total(B)(2) Total Public Shareholding (B)= (B)(1)+(B)(2) TOTAL(A)+(B) Shares (C) held by Custodians and against which Depository Receipts have been issued TOTAL (A)+(B)+(C) 1116 74459 74582 74631 648608 27434455 65961072 94321108 553782 21018656 59531725 81410306 0.69 29.09 69.94 100.00 0.69 29.09 69.94 100.00 NA NA NA 10831334 NA NA NA 11.48

0.00

NA

NA

GRAND

74631 94321108

81410306

100.00 10831334 11.48

DIVIDEND DISTRIBUTION POLICY

Company NSE Symbol BC Start Series Record Date BE BE BE BE BE BE BL BL BL BL D at e Escorts Limited ESCORTS

BC End D No Delivery Start No Delivery End Ex Date at Date Date e Purpose

01/03/2010 12/03/2010 25/02/2010 28/12/2009 30/12/2009 23/12/2009 26/12/2008 30/12/2008 23/12/2008 29/12/2007 31/12/2007 27/12/2007

DIVIDEND-RS.1/- PER SHARE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE AGM / DIVIDEND (PURPOSE REVISED) 45%

11/08/2000 22/08/2000 27/07/2000 27/07/2000 01/07/1999 28/07/1999 16/06/1999 16/06/1999 01/03/2010 12/03/2010 25/02/2010 28/12/2009 30/12/2009 23/12/2009 26/12/2008 30/12/2008 23/12/2008 29/12/2007 31/12/2007 27/12/2007 -

07/08/2000 ANNUAL BOOK CLOSURE 25/06/1999 -

DIVIDEND-RS.1/- PER SHARE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE

BL BL

25/12/2006 31/12/2006 21/12/2006 26/12/2005 31/12/2005 22/12/2005 12/03/2010

ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE INTEREST PAYMENT DIVIDEND-RS.1/- PER SHARE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE ANNUAL BOOK CLOSURE INTEREST PAYMENT INT. PAYMENT

D1 15/03/2010 D1 28/03/2008 EQ EQ EQ EQ EQ EQ -

19/03/2008 19/03/2008

27/03/2008 INTEREST PAYMENT

01/03/2010 12/03/2010 25/02/2010 28/12/2009 30/12/2009 23/12/2009 26/12/2008 30/12/2008 23/12/2008 29/12/2007 31/12/2007 27/12/2007 25/12/2006 31/12/2006 21/12/2006 26/12/2005 31/12/2005 22/12/2005 12/03/2010 19/03/2008

S1 15/03/2010 S1 28/03/2008

CHAPTER IV

What is a Depository?

A depository is an organisation which holds securities of investors in electronic form at the request of the investors through a registered Depository Participant. It also provides services related to transactions in securities.

SEBI registered depositorys :NSDL :- National securities depository limited CDSL :- Central depository services limited Minimum net worth required for a depository is 100 crores

NSDL:
Although India had a vibrant capital market, which is more than a century old,the paper-based settlement of trades caused substantial problems like bad delivery and delayed transfer of title till recently. The enactment of Depositories Act in August 1996 paved the way for establishment of NSDL, the first depository in India. This depository promoted by institutions of national stature responsible for economic development of the country has since established a national infrastructure of international standard that handles most of the trading and settlement in dematerialized form in Indian capital market. Using innovative and flexible technology systems, NSDL works to support the investors and brokers in the capital market of the country. NSDL aims at ensuring the safety and soundness of Indian marketplaces by developing settlement solutions that increase efficiency, minimize risk and reduce costs. At NSDL, we play a quiet but central role in developing products and services that will continue to nurture the growing needs of the financial services industry. In the depository system, securities are held in depository accounts, which is more or less similar to holding funds in bank accounts. Transfer of

ownership of securities is done through simple account transfers. This method does away with all the risks and hassles normally associated with paperwork. Consequently, the cost of transacting in a depository environment is considerably lower as compared to transacting in certificates.

DEPOSITORY PARTICIPANTS:
A Depository Participant (DP) is described as an agent of the depository. They are the intermediaries between the depository and the investors. The relationship between the DPs and the depository is governed by an agreement made between the two under the Depositories Act. In a strictly legal sense, a DP is an entity that is registered as such with SEBI under the provisions of the SEBI Act. As per the provisions of this Act, a DP can offer depository-related services only after obtaining a certificate of registration from SEBI. SEBI (D&P) Regulations, 1996prescribe a minimum net worth of Rs.50 lakh for stockbrokers, R&T agents and non-banking finance companies (NBFC), for granting them a certificate of registration to act as DPs. If a stockbroker seeks to act as a DP in more than one depository, he should comply with the specified net worth criterion separately for each such depository. No minimum net worth criterion has been prescribed for other categories of DPs. However, depositories can fix a higher net worth criterion for their DPs. NSDL requires a minimum net worth of Rs.100 lakh to be eligible to become a DP as against Rs.50 lakh prescribed by SEBI (D&P) Regulations.

Instruments :

The changes in the regulatory framework of the capital market and fiscal policies have also resulted in newer kinds of financial instruments (securities) being introduced in the market. Also, a lot of financial innovation by companies who are now permitted to undertake treasury operations has resulted in newer kinds of instruments - all of which can be traded being introduced. The variations in all these instruments depend on the tenure, the nature of security, the interest rate, the collateral security offered and the trading features, etc Debentures Bonds Preference Share Equity Shares Government securities Capital Market Processes Initial Public Offering (IPO) Private Placement Preferential Offer/Rights Issue Private Placement

Benefits of Depository System:

In the depository system, the ownership and transfer of securities takes place by means of electronic book entries. At the outset, this system rids the capital market of the dangers related to handling of paper. NSDL provides numerous direct and indirect benefits, like:

Elimination of bad deliveries

In the depository environment, once holdings of an investor are dematerialized, the question of bad delivery does not arise i.e. they cannot be held "under objection". In the physical environment, buyer was required to take the risk of transfer and face uncertainty of the quality of assets purchased. In a depository environment good money certainly begets good quality of assets.

Elimination of all risks associated with physical certificates

Dealing in physical securities have associated security risks of theft of stocks, mutilation of certificates, loss of certificates during movements through and from the registrars, thus exposing the investor to the cost of obtaining duplicate certificates and advertisements, etc. This problem does not arise in the depository environment.

No stamp duty
For transfer of any kind of securities in the depository. This waiver extends to equity shares, debt instruments and units of mutual funds.

Immediate transfer and registration of Securities

In the depository environment, once the securities are credited to the investors account on pay out, he becomes the legal owner of the securities. There is no further need to send it to the company's registrar for registration.

Having purchased securities in the physical environment, the investor has to send it to the company's registrar so that the change of ownership can be registered. This process usually takes around three to four months and is rarely completed within the statutory framework of two months thus exposing the investor to opportunity cost of delay in transfer and to risk of loss in transit. To over come this, the normally accepted practice is to hold the securities in street names i.e. not to register the change of ownership. However, if the investors miss a book closure the securities are not good for delivery and the investor would also stand to loose his corporate entitlements.

Faster settlement cycle

The exclusive demat segments follow rolling settlement cycle of T+2 i.e. the settlement of trades will be on the 2nd working day from the trade day. This will enable faster turnover of stock and more liquidity with the investor.

Faster disbursement of non-cash corporate benefits like rights, bonus, etc.

NSDL provides for direct credit of non-cash corporate entitlements to an investors account, thereby ensuring faster disbursement and avoiding risk of loss of certificates in transit.

Reduction in brokerage by many brokers for trading in dematerialized securities

Brokers provide this benefit to investors as dealing in dematerialized securities reduces their back office cost of handling paper and also eliminates the risk of being the introducing broker.

 Reduction in handling of huge volumes of paper Periodic status reports to investors on their holdings and transactions, leading to better controls. Elimination of problems related to change of address of investor, transmission, etc
In case of change of address or transmission of demat shares, investors are saved from undergoing the entire change procedure with each company or registrar. Investors have to only inform their DP with all relevant documents and the required changes are effected in the database of all the companies, where the investor is a registered holder of securities.

Elimination of problems related to selling securities on behalf of a minor

A natural guardian is not required to take court approval for selling demat securities on behalf of a minor.

Ease in portfolio monitoring

Since statement of account gives a consolidated position of investments in all instruments.

MY JOB AT ESCORTS
My Job at Escorts securities ltd

I started my job as financial executive traniee. My job profile was to sell the financial products of ESCORTS SECURITIES in my project. The branch manager narrated me the whole procedure. My job profile was to generate meeting the person and take view & also make them aware about online trading & DEMAT a/c. After the meeting person shortlist the person which best suite the requirements.

1. Personal Interview.
2. Telephonic

Interview.

The Job profile

Selling demats a/cs &making investors aware about online trading.

CHAPTER V

COMPETITIVE ANALYSIS

COMPETITIVE ANALYSIS

1.8 KEY PLAYERS IN FINANCIAL SERVICES INDUSTRY:

1) ICICI Securities Ltd. ICICI Securities Limited (i-SEC) is a wholly owned investment-banking subsidiary of ICICI Limited. ICICI is the only non-Japanese Asian financial institution to be listed on the New York Stock Exchange (NYSE). ICICI Securities was formed on 22nd Feb. 1993, when ICICI's Merchant Banking Division was spun off into a new company; ICICI Securities today is India's leading Investment Bank and one of the most significant players in the Indian capital markets. ICICI Brokerage Services Limited (IBSL) set up in March 1995; IBSL is a 100% subsidiary of iSEC. It commenced its securities brokerage activities in February 1996 and is registered with the National Stock Exchange of India Limited and The Stock Exchange, Mumbai. ICICI has started a website ICICIdirect.com which is the most comprehensive website, which allows you to invest in Shares, Mutual funds, Derivatives (Futures and Options) and other financial products. ICICI has a large network of branches all over India. Merchant Banking

2) HDFC Ltd: Housing Development Finance Corporation Limited is the leading financial company in India. IT has large network of branches all over India. HDFC Securities which is fully subsidiary of HDFC provides Demat service. HDFC and its subsidiary provides following services.

3) Kotak Securities Ltd: Kotak Securities needs no introduction as one of the largest stock broking houses in the country and a leading distributor of primary market offerings. Kotak Securities limited is a joint venture between Kotak Mahindra Bank and Goldman Sachs, the international investment banking and brokerage firm.

Kotak Securities is a corporate member of both the BSE and the NSE. It is also a depository participant with the National Securities Depository Limited (NSDL) for trading and settlement of dematerialized shares. Services offered: Financial Product Distribution

4) Motilal Oswal Securities Ltd. Motilal Oswal Securities Ltd (MOSL) is one of the leading equity research and broking houses of India. MOSL has a 20-member research team, which is engaged round the clock in analyzing the Indian economy and corporate sectors to identify equity investment ideas. Asia Money Broker's Poll 2002 has rated MOSL as one of the best Indian broking house, for research, for the second time since 2000. Motilal Oswal is member of NSDL and CDSIL for DP. It has wide network of branches. It has 158 branches all over India. Services Offered:

5) Sharekhan: Sharekhan is online stock trading company of SSKI Group, provider of India-based investment banking and corporate finance service. ShareKhan is one of the largest stock broking houses in the country. S.S. Kantilal Ishwarlal Securities Limited (SSKI) has b een among Indias leading broking houses for more than a century. Sharekhan's equity related services include trade execution on BSE, NSE, Derivatives, commodities, depository services, online trading and investment advice. Trading is available in BSE and NSE. Along with Sharekhan.com website, ShareKhan has around 510 offices (share shops) in 170 cities around the country. Services Offered:

6) Indiabulls: Indiabulls Group is one of Indias top Business houses with businesses spread over Real Estate, Infrastructure, Financial Services, Securities, Retail, Multiplex and Power sectors. The group

companies are listed on important Indian and Overseas markets. Indiabulls group includes Indiabulls Financial Services, Indiabulls Real Estate Ltd and Indiabulls Securities Ltd. Indiabulls Financial Services is an integrated financial services powerhouse providing Consumer Finance, Housing Finance, Commercial Loans, Life Insurance, Asset Management and Advisory services.

SWOT ANALYSIS
Strengths:
It is a pioneer in online trading and more than 800 peoples working in the organization. Escorts provides multi-channel access to all its customers through a strong online presence with www.escorts securities ltd.com.
Escorts

ltd has dedicated research teams for fundamental and technical research. Which constantly track the pulse of the market and provide timely investment advice free of cost to its clients which has a strike rate of 70-80%.

Weakness:
Localized presence due to insufficient investments for country wide expansion. Lack of awareness among customers because of non-aggressive promotional strategies (print media, newspapers, etc). Lesser emphasis on customer retention.

Opportunities:
With the booming capital market it can successfully launch new services and raise its clients base. It can easily tap the retail investors with small saving through promotional channels like print media, electronic media, etc. As interest on fixed deposits with post office and banks are all time low, more and more small investors are entering into stock market. Abolition of long term capital gain tax on shares and reduction in short term capital gain is making stock market

as hot destination for investment among small investors. Increasing usage of internet through broadband connectivity may boost a whole new breed of investors for trading in securities.

Threats:
Aggressive promotional strategies by close competitors may hamper Escortss acceptance by new clients. Lack of sufficient branch-offices for speedy delivery of services. Other players are providing margin funds to investors on easy terms where as there is no such facility in share khan. More and more players are venturing into this domain which can further reduce the earnings of Escorts.

CHAPTER VI

MARKETING PROBLEMS
MARKETING PROBLEMS
The old and out dated technique of marketing is used to prospect customers. More modern techniques must be adopted. The company must sponsor shows and give presentations in corporate houses. The financial health check must be performed for

every prospect to assess his/her true financial position and needs. Some of the advisors skip this vital step and the prospect ends up with a plan they do not appreciate and soon surrender or discontinue. Some of the main problems are: Large amount of competition (many players in the market) Other brands are well advertised and have higher recall value Due to High brokage are difficult to market Incorrect perception about securities market Customers do not have risk appetite to invest in shares Some prospects have already invested and are not interested in further investments Large amount of documentation Customers do not like their money locked up for many years Lack of awareness about the securities market

SUGGESTIONS FOR IMPROVEMENT 1. MORE BRANCHES Need to open more branches to be a topper in market Because it has a

low distribution network. 2. LESS TIME They should try to make some arrangements to reduce account opening time by verifying documents at branch it selves. 3. LINK-BANK A/Cs Linked as many accounts as client wants to its online account.

Create a positive perception about securities Speak about the good features of investment plan offers like high returns Improve the efficiency in operations Attract the youth of India with higher returns on investment as returns are the motivating factor which influence purchase of securities Tap the urban market where there is large potential Diversify product portfolio Make products more straight forward reduce complexities

CHAPTER VII ANALYSIS & INTERPRETATION

DATA ANALYSIS AND INTERPRETATION
Q1. In which of these Financial Instruments do you invest into?
Financial Instrument Percentage of respondent

Mutual Fund

75%

Bond

16%

Online trading

7%

Derivative

2%

Result of Preference of Investment

Interpretation: This shows that although the mutual funds market is on the rise yet, the most favoured investment continues to be in the Share Market. So, with a more transparent system, investment in the Stock Market can definitely be increased.

Q2. Are you aware of online Share trading?

Aware of online share trading Percentage of respondent

Yes No

72% 28%

Result of awareness of online trading Interpretation: With the increase in cyber education, the awareness towards online share trading has increased by leaps and bounds. This awareness is expected to increase further with the increase in Internet education.

Q3. Heard about ESCORTS SECURITIES ltd.?

Awareness of Escorts securitiesltd. Percentage of respondent Yes No 70% 30%

Interpretation: This pie-chart shows that This brand image should be further leveraged by the company to increase its market share over its competitors.

Q4. Do you know about the facilities provided by Escorts ltd.?

Awareness of Escorts ltd. Services Percentage of respondent

Yes No

36% 64%

Sales

1st Qtr 2nd Qtr

Interpretation: Although there is sufficiently high brand equity among the target audience yet, it is to be noted that the customers are not aware of the facilities provided by the company meaning thereby, that, the company should concentrate more towards promotional tools and increase its focus on product awareness rather than brand awareness.

Q.5 Which company provide a less BROKARAGE rate ?

Company Name Percentage of respondent

Sharekhan ltd. HDFC Escorts

22 11 17

Q. 6 Which company provide you a large number of product and services?

Company Name Percentage of respondent

Sharekhan ltd. HDFC ICICI

22 10 18

INTERPRETATION:44% have respondent of Sharekhan ltd., 20% have respondent of HDFC, 36% have respondent of ICICI.

Q. 7 How many of you satisfy with the level of current broker?

Interpretation: This pie chart accentuates the fact that Strategic marketing, today, has gone beyond only meeting Sales targets and generating profit volumes. 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.

Satisfaction level among Customers with current broker

Yes NO 92% 8%

Sales

1st Qtr 2nd Qtr

Q. 8 How many of do training:

A) Daily B) Monthly C) Weekly D) Yearly Interpretation: In spite of the huge returns that the share market promises, we see that there is still a dearth of active traders and investors. 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. It requires efficient bureaucratic intervention on the part of the Government.
Frequency of Trading

Sales

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

Daily Weekly Monthly Yearly -

9% 27% 53% 11%

Q. 9According to your perspective which investment gives You maximum return?

(1) Share market (2) Mutual funds (3) Purchasing insurance policy

Interpretation As of today people believe in secured investment with no risk & high return. So insurance policy are the best option for them as they give good return after a period of time .Share market has also come up in a big way though the risk factor is a bit too high despite good return.

Represent a pie chart

OBSERVATION
To study the sales and distribution management and improve the Customer Acquisition Process by analyzing the consumer behavior, response and mindset towards the product and services the company

offers.

1. Preference of Investment:
Consumers want to invest 75% in Mutual funds, 16% in Bonds, 7% in online trading and 2% in Derivatives.

2.Awareness on Online Share Trading:

72% consumers are aware of online share trading and 28% consumers are not aware of online share trading.

3. Awareness of escorts ltd. :

70% consumers are know about Escorts ltd. and 30% consumers are not know about Escorts ltd.

4.Awareness about facilities provided by Escorts ltd. :

36% consumers are aware about the facilities provided by Escorts ltd. and 64% consumers are not know about the facilities provided by Escorts ltd.

5.Provide a less BROKARAGE rate:

44% have respondent of Sharekhan ltd., 22% have respondent of HDFC, 34% have respondent of ICICI.

6.Provide a large no. of Products and services:

44% have respondent of Sharekhan ltd., 20% have respondent of HDFC, 36% have respondent of ICICI.

ANALYSIS & INTERPRETATION

Decision to trade

CHAPTER VIII

FUTURE LINE OF RESEARCH

FUTURE LINE OF RESEARCH

The future topics for research in the organization could be setting up of an appropriate ad campaign. It is very vital to the companies success that the people of India know about

Escorts, its products and their special features and how securities in general can help them in their future. The other area of research could be in the management of funds Escorts possesses and how it can maximize returns for its investors. A research project could be undertaken on how to ensure that the money gets invested in the right companies and earns a medium high return on investment. Another area of research could be an analysis of the sales and marketing techniques used by escorts. A large number of changes could be introduced and this would help of improving the efficiency of the firm.

CHAPTER IX

FINDINGS
According to the survey most of the customers of ESCORTS SECURITIES Ltd says that it is pocket friendly. Coming to faith 70% say ESCORTS SECURITIES Ltd is better than others stock brokers due to customers satisfaction. Main purposes of investments are returns & liquidity. Investors take risk as well as returns into their mind while making the investment.

Businessmen are more interested in the stock market than the others. Commodity market is less preferred by the investors. People want to invest their money in the security market but they havent the Proper knowledge. People are not aware of hedging in stock market. People pay more emphasis on brokerage than service provided by brokerage houses.

CHAPTER X

CONCLUSION
On the basis of the study it is found that ESCORTS SECURITIES Ltd is better services provider than the other stockbrokers because of their timely research and personalized advice on what stocks to buy and sell. ESCORTS Ltd. provide the facility of relationship manager for encouragement and protect the interest of the investors. It also provides the information through the internet and mobile alerts that what IPOs are coming in the market and it also provides its research on the future prospect of the IPO.

Study also concludes that people are not much aware of commodity market and while its going to be biggest market in India. The company should also organize seminars and similar activities to enhance the knowledge of prospective and existing customers, so that they feel more comfortable while investing in the stock market.

SUGGESTION
1. MORE BRANCHES Need to open more branches to be a topper in market Because it has a low distribution network.

2. LESS TIME They should try to make some arrangements to reduce

account opening time by verifying documents at branch it selves. 3. LINK-BANK A/Cs Linked as many accounts as client wants to its online account. 4.CUSTOMER SATISFACTION The company should focus on the customer satisfaction not on just taking money from their pocket.

5.CONTROLLED BRANCHES The company would have to make some arrangements to control the branches and make standardized procedures for all of them for their better control and performance appraisal. Commitment should be equalized for every person. Provide the facility of free demonstrations for all. Improvement in the opening of De-mat & contract notice procedure is required. There should be a limited number of clients under the relationship manger. So that he can handle new as well as old customer properly. Some promotional activities are required for the awareness of the customer. People at young age should be encouraged to invest in stock market. Seminars should be held for providing information to prospective and present customers.
108

REFERENCES

Historical perspective. Wikipedia. 19 Apr. 2007<http://www.wikipedia.com>. Overview." Indiacore. 18 Apr. 2007 <http://www.indiacore.com>. Reforms." Wikipedia. 17 Apr. 2007 <http://www.wikipedia.com>.

Stock price of Escorts" Money Control. 17 Apr. 2007 <http://www.money control.com Random Sampling. Statpac. 26 Apr. 2007 <http://www.statpac.com>.

BIBLOGRAPHY
Websites:

1. www.Google.com 2. www.bseindia.com 3. www.nseindia.com

4. www.moneycontrol.com
5. www.sharekhan.com 6. www.icicidirect.com 7. www.5paisa.com 8. www.Indiabulls.com 9. www.hdfcsecurities.com

10. WWW.KARVY.COM

NEWSPAPERS:
1. ECONOMIC TIMES 2. TIMES OF INDIA