Beruflich Dokumente
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ON
Submitted to
All India Management Association Centre for Management
Education
Management House,
14 Institutional Area,
Lodhi Road,
New Delhi-110003.
JULY 2004-2006
BY
CHANDRIMA NANDI
Registration No. 800420591
GUIDED BY
LATIKA ROY
Area Manager
An exchange of ideas generates a new object to work in a better way. Apart from
the ability labor and time devotion, guidance and co-operation are two pillars for
the success of a project. Whenever a person is helped or co-operated by others,
his heart is bound to pay gratitude to others.
A satiation and pleasure that accompany the successful completion of task would
be incomplete without the mention of the people who have made it possible and
whose consent guidance and encouragement served as a guiding light for the
completion of the study.
I would also like to express my sincere thanks to honorable President, Mr. Sudhir
Angur and our Director Mr. B.V.Krishnamurthy for giving me an opportunity for
undergoing this study. I would also like to express my gratitude to my project
guide Mrs. Latika Roy for her constant encouragement and guidance without the
task would not have been completed.
Last but not the least I would like to thank my parent and friends for their support
and suggestions.
THANKYOU ALL
CHANDRIMA NANDI
CONTENTS
Chapter No. Contents Page
Chapter I At a Glance 1-2
Chapter II Introduction 3-7
• Background
• Purpose
• Objective
• Limitations of the study
• Plan analysis
Chapter III Industry Profile 8-23
Chapter IV Company profile 24-29
Chapter V Products and Services 30-79
Chapter VI SWOT Analysis 80-82
Chapter VII Methodology 83-84
Chapter VIII Analysis & interpretation 85-104
Chapter IX Summary of findings 105-107
Recommendations & Conclusion 108-110
Bibliography 111-112
Annexure 113-116
At a Glance
Executive Summary
The study is about comparing the different services and products offered at
SHCIL with the other Depository participants. Project mainly deals with how
the resources of the organization are used in their day-to-day activities. For a
finance manager it will be of great help to know how to properly utilize the
resources of the organization. It is not only the theory, which will help in the
corporate world, but also how things happen practically. Here there is an
opportunity to learn how the things happen practically. Every day the various
activities happening in the department are observed and understood carefully.
The study initially concentrated on obtaining the information from the investors
on various parameters. As it is a finance project mainly data will be available
internally. After finishing this task, the actual analysis of the project has been
started where certain important calculations has been done. This helped to
come out with some conclusions. Also the data pertaining to some Demat
Section Managers has been taken and analyzed which made to arrive at
some interim conclusions as a part of project.
Stock holding has various financial Products and Services to be offered to the
clients but problem lies in the low promotional activities undertaken by it, due
to which though it has the services not offered by other DP's it fails in
captivating customers. Another problem faced by it is technology; systems at
stock holding are not technologically upgraded: it follows old technology and
modes of making entries of payments into systems. Due to system error
payments to franchisees are not made on time, which in turn affects their
business relationship. Since stock holding is into DP's business from long time
it still follows old methods of operations. Thus, the researcher got interested to
conduct study on the Depository Services under the title “Comparative
analysis of various Depository Participants with reference to Stock
Holding Corporation of India limited”.
Introduction
Background
Depository
A depository is a facility for holding securities, which enables securities
transactions to be processed by book entry. To achieve this purpose, the
depository may immobilize the securities or dematerialise them (so that they
exist only as electronic records).' India has chosen the dematerialisation
route. In India, a depository is an organization, which holds the beneficial
owner's securities in electronic form, through a registered Depository
Participant (DP). A depository functions somewhat similar to a commercial
bank. To avail of the services offered by a depository, the investor has to
open an account with it through a registered DP.
Depository Participant
A Depository Participant (DP) is an agent of the depository who is authorized
to offer depository services to investors. Financial institutions, banks,
custodians and stockbrokers complying with the requirements prescribed by
SEBI/ Depositories can be registered as DP.
Benefits of Depository
Bad delivery eliminated
Immediate transfer of shares
No stamp duty on such transfers
Elimination of risks that are normally associated in dealing with
Physical certificates - loss / theft / mutilation due to careless handling /
forgery / etc
Reduced transaction cost
Research Title
A Comparative Analysis of Depository Participants in Bangalore with
reference to India’s Largest DP “Stock Holding Corporation Of India Ltd.”
Purpose
The past few years have seen a phenomenal growth in the capital market
leading to an explosion in transaction holding despite the transparency offered
by NSE and BSE, the primitive settlement and transfer process kept the
biggest chunk of the market risk- bad delivery, delayed transfer, fake
certificates, loss and theft etc, unresolved. The Depositories is the answer to
such risk and problems.
Objectives
The main objectives of the project undertaken are-
To understand the attitude and perception of investors/savers towards
the DPs.
To ascertain SHCIL’s position in the competitive market.
To collect the data on various parameters
• Tariff
• Service
• Reach(No. of branches)
• Promoters
• Product
To develop and analyze strategies of SHCIL to help improve its
market share.
To offer suggestions based upon the findings.
PLAN ANALYSIS
The collected data will be analyzed with the help of parametric techniques
such as percentages, correlation, regression, co-efficient of variation and the
like. Wherever necessary tables charts, graphs, diagrams are used.
INDUSTRY PROFILE
INDUSTRY PROFILE
FINANCIAL MARKET
India has a well established capital market mechanism where in effective and
efficient transfer of money capital or financial resources from the investing
class to the entrepreneur class in the private and the public sector of the
economy occur. Indian capital market has a long history of organized trading
which started with the transaction in the loan stocks of the East India
Company; from that time it has undergone drastic changes to meet the
requirements of the globalization. The Indian capital market had been
dormant in the 70’s and 80’s has witnessed unprecedented boom during the
recent years. There has been a shift of house hold savings from physical
assets to financial assets, particularly the risk bearing securities such as
shares and debentures. Capital market structure has also undergone sea
CAPITAL MARKET
The secondary market or stock exchange where existing securities are traded
is an auction arena. Since 1995, trading in securities is screen based. Screen
based trading has also made an appearance in India. The secondary markets
consist of 23 stock exchanges including the NSE and OTCE and Inter
Connected Stock Exchanges of India ltd. The secondary market provides a
trading place for the securities already issued to be bought and sold. It also
provides liquidity to the initial buyers in the primary market to re-offer the
securities to any interested buyer at a price, if mutually accepted. An active
secondary market actually promotes the growth of the primary market and
capital formation because investors in the primary market are assured of a
continuous market and they can liquidate their investments in the stock
exchange.
DEPOSITORY
If either the issuer (a company which has issued securities) or the investor
opts to hold his securities in demat form, the issuer enters into an agreement
with the depository to enable the investors to dematerialize their securities.
Where an issuer has appointed a registrar to the issue and (R&T) agent, the
case may be for the securities declared for dematerialization
Functions of Depository:
Dematerlisation
Accounts Transfer
The depository gives effects to all transfers resulting from the settlement of
trade and other transaction between various beneficial owners by recording
entries in the accounts of such beneficial owners.
The clearing system performs the functions of ascertaining the pay-in (sell) or
pay (buy) of brokers who leave traded on the stock-exchange. Actual delivery
of securities to the clearing system from the selling brokers and delivery of
securities from the clearing system to the buying broker is done by depository.
To achieve this, depositories and the clearing system are linked electronically.
To handle the securities in electronic as per the Depositories Act 1996, two
depositories are registered with SEBI. They are: National Securities
Depository Limited (NSDL), Central Depository Services (India) Limited
(CDSL).
DEPOSITORY PARTICIPANTS
A bank included for the time being in the second schedule to the RBI.
The OP must enter into an agreement with a beneficial owner before acting as
a DR on his behalf. A DR while conducting business with a client, acts as an
agent of NSDL and is liable to the clients for all the acts and deeds performed
by him.
2. Separate accounts:
The DP shall open a separate account in the name of each beneficial owner’s
account only on receipt of instructions from beneficial owner.
3. Statement of account:
5. Connectivity:
7. Reconciliation:
8. Returns:
9. DP to indemnify depository:
A DP has to indemnify the depository, its officers and employees for all costs,
fees, expenses, liabilities, taxes, actual losses and damages of any nature
what so ever suffered like failure to comply with laws, failure to deliver eligible
securities etc.
11. Insurance:
DP’s should take appropriate insurance cover to insure against losses arising
from any possible business risk and system failure.
The DP should maintain and preserve the documents for all transactions for a
minimum period of 5 years.
Where DP’s maintain electronic records, they should ensure the integrity of
the data processing system. All necessary precautions should be taken to
ensure that the records are not lost, destroyed or tampered with sufficient
back-up of records should be taken and made available at all times at
different places. SEBI at any time may cancel the registration of DP if they are
not in complying with the rules laid by the depositories act. Like guilty of fraud,
repeated defaults. DR may sometimes choose to terminate its participation in
the depository by giving notice of less than 30 days.
f) CITIBANK
h) HDFC BANK
i) HSBC
j) DEUTSCHE BANK
k) DENA BANK
l) CANARA BANK
Ownership:
Management of NSDL:
Bye-laws of NSDL:
b) Definitions
c) Board of directors
d) Executive committee
e) Business rules
f) Participates
h) Securities
l) Appeals
m) Conciliation
n) Arbitration
Function of NSDL:
Transfer of securities.
Both NSDL and CDSL interface with investors through their service providers
known as DP. The depository is interconnected. It is possible to transfer
shares from one depository to another.
CDSL was promoted by The Stock Exchange, Mumbai (BSE) jointly with
leading banks such as State Bank of India, Bank of India, Bank of Baroda
HDFC Bank, Standard Chartered Bank, Union Bank of India and Centurion
Bank.
CDSL was set up with the objective of providing convenient, dependable ‘and
secure depository services at affordable cost to all market participants. Some
of the important milestones of CDSL system are:
• Honorable union finance minister, Shri Yashwanth Sinha flagged off the
operations of CDSL on July 15 1999.
• All leading stock exchanges like national stock exchange, Calcutta stock
exchange, Delhi stock exchange, stock exchange Ahmedabad, etc have
established Connectivity with CDSL.
• As at the end of Dec 2004, over 4900 issuers have admitted their securities
(equities, bonds, debentures, and commercial papers), units of mutual funds,
certificate of deposits etc. into the CDSL system.
CDSL’s demat services are extended through its agents called Depository
Participants (DP). The DP is the link between the investor and CDSL. An
investor who opens a demat account with a DP can utilize the services offered
by CDSL. While the OP processes the instructions of the investor , the
account and records thereof is maintained with CDSL A DP is thus a t centre”
for the investor.
In the depository system the ownership and transfer of securities take place
by means of electronic book entries. At the outset, this system capital market
of the dangers related to handling of paper. The benefits that are accrued by
this system are:
No stamp duty for transfer of equity instruments and units of mutual funds in
this system.
The exclusive demat segment follow rolling settlement of T+2 days which
enables faster turnover of stock and enhance liquidity with the investor.
In physical environment, the buyer is not secured since the shares purchased
may not be transferred. This is not the case with depository system.
NSDL provides for direct credit of non-cash corporate entitlements like rights,
bonus etc., to an investors account ensuring faster disbursement.
This increases from Rs.l0 lakh to Rs.20 Lakh per borrower. There is also a
reduction in minimum margin from 50% to 25% by banks to advances against
demat securities.
Brokers may provide a reduction in the brokerage of 0.25% to 0.5% for trading
in dematerialised securities as it reduces their back office cost of handling
paper.
A natural guardian is not required to take court approval for selling demat
securities on behalf of a minor.
Company profile
COMPANY PROFILE
BOARD OF DIRECTORS
JOINT MANAGING
DIRECTOR
VP (Depository Services)
VP (IT)
VP (Products)
VP (Personnel)
VP (HRD)
VP (R&D)
VP (Facilitation centre coordination)
DIVISIONAL MANAGER
Koramangala
Dy Manager B’Lore Manager CC
(Hubli) FC M’lore FC Malleswaram
CC
Jayanagar
CC
Davanagere
CC
Gulbarga Belgaum Shimoga
Udupi CC CC
CC CC
Dy
Trades
Mgr
PRODUCT PROFILE
1. ADDSHARES
Tie up with reputed banks which offer you the most competitive interest rates
in the market.
You can use the shares in your free account as collateral and take a loan from
any of our empanelled banks.
We complete your documentation and processing and give you the cheque
within 48 hours of application.
ADD shares are available at SHCIL centres in all the major cities.
Advantages
Our tie-ups with banks give you a wide range of banks to choose from.
This reads as a wider range of specified and non-specified shares to
get a loan against.
The ADDshares team helps you with the paper formalities precedent to
a loan.
You can now get a loan at competitive interest rates and margins. This
is a resultant of our tie-up with a wide range of banks.
ADDshares simplifies long-winded loan procedures for you and
facilitates early disbursement of funds.
ADDshares is available at any of our branches, numbering over 120.
Procedure
SHCIL forwards your loan application to the bank. SHCIL takes care of pledge
creation and intimation to the bank.
SHCIL follows up with the Bank and intimates you about the sanction of the
loan.
You can collect the cheque book issued by the bank from SHCIL or get it
couriered by us to you.
Documents required
Driving license
Ration card
Voters Identity card
Copy of Income Tax Return
2. EQUIBUY
Haven't we all gone through endless waiting periods after buying shares on
the exchange?
Even after payments have been made, we have to wait patiently to see those
shares reflected in the demat account. With the odd surprise of not seeing
them at all which you cannot discount.
Go through the detailed Equibuy procedure and you will see how Equibuy is a
one stop shop for your share purchases.
Features
An Equibuy instruction from you gets the shares credited into your
account the next day of payout
Payment for your purchase made from a running account called
Purchase Advance into which you remit an initial advance of Rs.1000
and maintain a minimum balance of Rs.250 at all times.
Choose one or more brokers from a list of 77 brokers empanelled with
SHCIL. Registration with broker is not necessary if you are already
registered under any of our other product schemes.
Advantages
Buy shares with a single instruction and get an assured credit of shares
into your account the next day of payout. Leave the settlement
procedures and broker interaction to us.
Affect a faster turnaround of your portfolio.
Equibuy has a very nominal charge attached to it.
An initial advance of Rs.1,000 in the Purchase Advance account and
replenishments, as and when necessary, take care of payment for your
purchases.
Choose on the exchange to buy your shares from BSE or NSE.
Choose from a range of 77 SHCIL empanelled brokers to execute your
purchases.
Equibuy from the SHCIL center closest to you. Select from 120
plus SHCIL centers across the country.
Procedure
If you are not already registered with one or more of our 77 empanelled
brokers under any of our other product schemes, register yourself by filling up
a broker registration form.
Your request will be good till the end of the day. If the shares are not
purchased before the end of the day, your request lapses and a fresh request
can be submitted the next day.
Your purchase request is transmitted to the broker as soon as you place your
request.
The broker executes the trade and sends SHCIL the contract note. The
payment for the shares purchased along with the service charge is made from
the Purchase Advance account.
The shares get credited into your account the next day of payout.
Tariff
On delivery basis
Get registered with one or more of any of 77 brokers empanelled with SHCIL.
Registration with broker not necessary if you are already registered under any
of our other product schemes.
3. FUNDINVEST
Introduction
Applications for investments can be source from any of the SHCIL offices.
Apart from guiding our investor to pick up the right combination of investment
instruments, we help them 'after-sales' service, by acting as an interlocutor
between the investor and the issuer of the securities. SHCIL is an AMFI
Registered Mutual Fund Advisor (ARMFA).
Features
All these Funds offer wide varieties of investment option depending on the risk
appetite of the investor. Some of the major categories are:
Debt Funds: The Debt Funds have the mandate of investing primarily in Debt
papers
Equity Funds: The Equity Funds have the mandate of investing primarily in
Equities
Balanced Funds: The Balanced Funds have the mandate of investing both in
Equities as well as Debt papers.
Infrastructure Bonds are issued by ICICI Bank and IDBI, with Section 88 as
the main feature
Private Placements: Debt papers issued for Private Placement with Structural
Obligations by the State and Central Government typically targeted for Trusts
and Provident Funds are distributed by Stock Holding.
Fixed Deposits: Fixed Deposits with high investment rating and issued by
blue- chip corporate are distributed by us. These papers generally offer 50 to
100 basis points more than bank fixed deposits of comparable period. At
present, we are distributing IDBI Suvidha Fixed Deposits and HDFC Fixed
Deposits.
Initial Public Offer: IPO’s offered from blue-chip corporate can be subscribed
from Stock Holding. Issues recently distributed by us are Canara Bank,
Allahabad Bank, Bharti Tele and I- Flex.
JM Mutual Fund
4. GOI BONDS
These Bonds are held in electronic form in an account called Bond Ledger
Account (BLA). Bond Ledger Accounts can be opened and operated with RBI
designated Receiving Offices. SHCIL has been designated as one of the
Receiving Offices by RBI for this purpose. Subscriptions for Savings Bonds
can be submitted at any of our branches.
Savings Bonds being sovereign in nature are absolutely safe and an attractive
investment option in the current volatile market situation.
1. Individual
3. Charitable Institution
Any institution which has obtained a certificate from Income tax Authority for
the purposes of Section 80G of the Income Tax Act, 1961
4. University
Features
1. Investment Limit
2. Interest Option
3. Tax Benefits
Interest is taxable under IT Act 1961. Exempt from Wealth Tax under
Wealth Tax Act 1957
4. Transferability
5. Nomination
6. Repayment
Advantages
Hassle free maintenance: The GOI Bonds are held in electronic form in
an account called Bond Ledger Account. This ensures smooth
investing minus paperwork.
Electronic Clearing Services: You can avail of Electronic Clearing
System (ECS) services. This ensures automatic credit of benefits and
redemptions when they accrue.
Easy access: You can apply for subscriptions into these Bonds in any
SHCIL center across the country.
Dispatch: Certificate of Holdings is dispatched to the client through
courier on realization of subscription.
Procedure
Subscription is a very simple process. Obtain the application form from any
of SHCIL notified centers across India.
Fill up ALL the relevant columns provided in the Application Form. e.g. For
ECS facility, a proof of the ECS Account like Cancelled Cheque / Banker's
Certification authenticating the Account No. and MICR details.
Documents required
5. INSURANCE
Introduction
SHCIL has 100 odd Branches all over India to take care of all your Insurance
related queries and needs.
Features
LIC products
2. CHILDREN’S POLICY
3. ENDOWMENT POLICY
4. RETIREMENT PLAN
The object of Key man insurance is to indemnify business firm from the loss of
earnings may occur because immediate replacement of the Key Man may not
be possible.
Section 37 (1) of the Income Tax Act ,1961 provides that any expenditure laid
out or expended wholly and exclusively for the purposes of business or
profession shall be allowed as a deduction in the computation of income from
business or profession.
Only Partnership firms and Companies are eligible for Key Man Insurance. If a
Key Man is an employee/officer in the Company /firm, the quantum of sum
Assured will be limited to ten times of annual remuneration paid to the
employee. The value of perquisites can also be considered as part of
remuneration to the extent of 30% of salary for this purpose.
• Moderate Premiums
• High bonus
• High liquidity
• Savings oriented
This policy not only makes provisions for the family of the Life Assured in
event of his early death but also assures a lump sum at a desired age. The
lump sum can be reinvested to provide an annuity during the remainder of his
life or in any other way considered suitable at that time. Premiums are usually
payable for the selected term of years or until death if it occurs during the term
period.
Just as in the case of limited payment whole life polices, here, too, the
payment of premium can be limited either to a single payment or to a term
shorter than the policy. The endowment is, however, payable only at the end
of the policy term, or upon death of the policy holder if it takes place earlier.
If payment of the premiums ceases after at least three years' premiums have
been paid, a free paid-up Policy for an amount bearing the same proportion to
the sum assured as the number of premiums actually paid bears to the
number stipulated for in the policy, will be automatically secured provided the
reduced sum assured, exclusive of any attached bonus, is not less than
Rs.250 Such reduced paid-up Policy will not be entitled to participate in the
profits declared thereafter, but such Bonus as has already been declared on
the Policy will remain attached thereto.
The benefits of this policy can be considered only for standard and
substandard lives Class I and II. It cannot be allowed for people engaged in
hazardous occupations. Individuals engaged in dangerous pursuits will be
rated against the revised tabular occupational extra rates. This policy covers
the risk for triple the sum assured.
• Moderate Premiums
• High bonus
• High liquidity
• Savings oriented
This policy is issued on the lives of the husband and wife provided the
female's life belongs to Category I or is actively engaged in her spouse's
business. In case of death of one of the policy holder the surviving partner
gets the sum assured, the premium is stopped and on death or maturity full
sum assured along with bonus is paid back.
RETIREMENT PLAN
Its once again that time of the year when most of you are on the look out for
tax saving avenues for investment. And for most, insurance has been on the
top of the list of choices. While earlier, buying insurance was mainly for tax
benefits, but these days with increased awareness, consumers have been
narrowing down on picking up the right policy that suits their future needs.
NIA Products
1. MEDICLAIM POLICY
2. FIRE INSURANCE
3. PRIVATE CAR INSURANCE
4. HOUSEHOLDER’S POLICY
MEDICLAIM POLICY
This insurance policy can be used to protect the insured party against
expenses incurred for hospitalization for illness/ injury/ diseases as well as
domiciliary hospitalization. Suitable for:
• Each and every person aged between 5 and 75 years of age. Children
aged between 3 months and 5 years have to be insured along with
their parents.
• Government or private institutions for their employees.
• Clubs or associations for their bona-fide members.
FIRE INSURANCE
Suitable for:
This policy is vital for every individual or corporate body with respect to the
property where they have insurable interest. Since insurable interest signifies
the right to insure, the person or corporate body must be legally competent to
enter into a fire insurance contract.
Riskscovered
This insurance policy protects the motor vehicle from loss or damage
HOUSEHOLDER’S POLICY
If the insured party opts for cover for more than 4 sections excluding
compulsory sections, a discount of 15 percent is offered on the Non-Tariff
sections. For more than 6 sections, excluding Sections I and II, 20 percent
discount is offered on Non-Tariff sections.
5. STOCK DIRECT
STOCKdirect has changed the way you look at trading in securities. From
your desktop you can now send instructions for buying/selling shares. Three-
way hands shake between leading brokers, national and international banks
and SHCIL is the crux of STOCKdirect.
A few clicks will seamlessly check your funds and security positions, route the
order to the broker of your choice and do the necessary fund and share
movements for you. For people who are not inclined to trading on the net, we
have Request Transmitting Machines (RTMs) placed at specified SHCIL
centres. This is an electronic touch screen kiosk where you can insert your
smart card and trade effortlessly.
Features
Advantages
OneStopShop
Give a single instruction towards funds confirmation for buy orders,
order routing to your broker and fund and share movements for
settlement purpose.
Convenience
Trade from home through the net or use the RTMs placed at specified
SHCIL centres.
Security
Digital Signature & Smart Card technology based on 128 bit Encryption
make your transactions 100% secure.
Cost-Effective
No minimum value of transaction.
ChoiceofStockExchanges
Buy/Sell shares on BSE / NSE.
Procedure
If you already have a demat account with us, fill up a conversion form to
convert your demat account to STOCkdirect. If you do not have a demat
account, fill up a demat Account Opening form and submit it at any of our
branches.
Open a savings bank account with our partner banks or You have the option
of opening with SHCIL a running account called the Purchase Advance by
remitting an initial advance of Rs.1,000 by way of cash / cheque / DD.
Should you decide to open a Bank account, fill up your bank account number
in the conversion form and submit a photocopy of a cheque leaf from your
cheque book for MICR details
If you have a PC with internet, you can opt for the software option;
alternatively you can opt for the Smart Card option. You may go in for both the
options also.
-Operating manual.
Tariff
• Brokerage
0.50% with a minimum of Rs 50/- per client per broker per settlement*.
Normal ISA charges applicable as per client's tariff scheme. Service tax
applicable as per GOI notifications.
Checklist
Open a Savings / Current Account with any of SHCIL'S partner Banks. The
minimum balance to be maintained in the Bank account is Rs
1,000/-.Alternately, you can open a running account called Purchase Advance
to facilitate your fund transfers. If you opt for Purchase Advance, The
following conditions apply:
SERVICE PROFILE
Depository participants
Introduction
From a tentative foray in 1998 into the individual investor arena to servicing
around seven lakh accounts, we have endeavored to constantly add and
innovate to make business a pleasure for you.
Over 100 of our networked branches ensure we are available where you look
out for us.
Open account
You can collect your account opening form from any of our branches or
download it from our site itself.
As prescribed by Depository bye-laws, accounts have to be opened in
the exact order in which the name(s) appear on the share certificate.
Remember that Holding pattern A B is not the same as BA. However,
minor differences like abbreviations, spelling mistakes can be ignored
provided signatures recorded with the registrar / company is the same.
Once your account is opened, you will be allotted a client identity number.
You will be sent an operating kit containing:
Maintenance
A request letter ( format available on the site) signed by all the holders is
required Along with this Photocopy of proof of identification and proof of new
address is required. Please also bring the originals with you for verification
purpose. Client or the authorized bearer can visit our branch for the same.
Copy of the latest transaction statement received from SHCIL is also required.
Change in signature
Request letter (format available) signed by the client. The new signature to be
attested by the bank. The request may be submitted along with the copy of
POI and the photocopy of the latest transaction statement received from
SHCIL.
Addition of PAN/Mapin
These accounts can be operated by both the client and the POA Holder. In
case the client has given the POA in favour of 2 or more persons, then the
mode of operation of the POA holders is also to be mentioned. In case the
power of attorney is to be revoked, a letter signed by the client is required.
Request letter signed by all the holders, with a photocopy of the recent
telephone bill and proof of identification of one of the holder.
Instruction by Fax
Clients may avail this facility by faxing their delivery instructions to SHCIL, by
executing the fax indemnity.
For recording any change in the standing instruction (for receiving direct
credits) in the demat account, we require a letter signed by all the holders.
If you have given POA details and you wish to operate the account yourself,
the POA has to be revoked by you in writing.
- When the account has joint holders and one of the holder dies.
- When the account has a sole holder with a nominee.
- When the account has a sole holder without a nominee.
Freezing of account
An account is frozen/suspended
Defreezing of account
Demat
In this category, the shares purchased by you in the physical form can be sent
to the Registrar / Company for transfer and dematerialisation at the same
time.
Once your demat account is opened with us and you have received your
client identity number, you can start dematerialising your shares. You can
submit the shares over the counter at any of our branches. Do go through the
tips given on filling up the DRF to avoid rejection.
When the company gives you credit, these shares will reflect under
"free" column. Now you can sell these shares. In case the company is
not satisfied with the details furnished, it will reject the shares.
If your shares have been rejected by the company, SHCIL will forward
the shares to you on receiving them from the company.
Direct Demat
Send the physical certificates along with duly executed Transfer Deeds
to the company / Registrar indicating your intention to directly demat
the shares after transfer.
The company upon effecting the transfer will send you a letter
containing details of the share certificates.
Submit this letter with a duly filled DRF to us well within the specified
date mentioned in the letter. If the letter does not reach the company /
registrar before the specified date, the Company / Registrar dispatches
the physical certificates back to you.
Based on guidelines issued by SEBI, the procedures for transfer cum demat
is as follows:
Firstly, you will send the physical certificates along with duly executed
Transfer Deeds directly to the company / Registrar indicating your
intention to directly demat the shares after transfer.
The company / registrar, upon effecting transfer will send you a letter.
This letter will contain all the details of certificates such as folio No. ,
certificate no, Distinctive Range Number (DNR), etc.
The certificates will be retained by the company / registrar. You will fill
the demat particulars in the DRF, attach it with the letter sent by the
company and submit the same to us.
Pledge
If the form is complete in all respects, the DP processes the form and
generates a pledge / hypothecation instruction number for the request
Securities to the extent of the instruction are debited from the free or
locked-in balances and credited as pledged balances of the pledgor so
that they cannot be used for any transactions
The pledgee will submit a form to its DP to accept / reject the pledge /
hypothecation request
If the pledgee accepts the request by the pledgor, the acceptance is
communicated electronically to the pledgor's DP. Once the pledgee's
DP confirms the acceptance of the pledge, the pledgor cannot cancel
the pledge / hypothecation order. The pledgee's DP executes the
pledge / hypothecation request as per the instructions given
In case the pledgee rejects the pledge request, the pledgor's DP is
intimated electronically. Now the securities which were earlier credited
as pledged balances will be credited to free / locked-in balances
Once the loan is repaid by the pledgor, the pledgor initiates the closure
of the plegde. The request for closure is transmitted electronically to
the pledgee's DP. The pledgee's acceptance / rejection of the request
for closure of pledge is transmitted electronically to the pledgor's DP
If the pledge is closed, the securities will be reflected as free / locked-in
balances
In case the pledgor defaults in repaying the loan to the pledgee, the
pledgee instructs his DP to invoke the pledge / hypothecation.
Reports
The transaction cum billing and holding statement will have the
following details :
Tariff
Payment option
Clearing member
Introduction
Advantages
o CM Principal Accounts
o NSCCL CM Accounts
If you are shifting from another DP If you are opening a fresh Pool
to SHCIL account .
Account opening form Account opening form
• Board resolution • Board resolution
• Memorandum Of • Memorandum Of
Association Association
• Authorized
• Authorised Signatories (for
Signatories (for
corporates)
corporates)
• CM Name
• old CM BP ID
• old DP Name
• New DP name.
Custodial services
Reporting
Among the host of Reporting features offered by SHCIL, the notable ones are
Some of these highly specialized reports are provided to you ONLINE and
FREE only by SHCIL.
Derivatives
Introduction
Advantages
SHCIL has always been a pioneer in clearing and settlement services in the
cash segment at both the exchanges. SHCIL has the capability to handle
large volumes of business with greatest accuracy, keeping customer interests
as the top priority.
SHCIL in it’s endeavor to serve various entities in the derivatives segment has
developed indigenous solution keeping in view the strict regulatory
requirements.
Margins i.e. initial margin (IM) for exposure and maintenance margin (MM)
for daily settlement.
Initial Margin(IM)
minimum Rs. 10 lakh as initial margin (IM) in either of the following ways:
Note: The above proportion is valid for NSE. For BSE minimum cash
requirements are Rs.2.5 lakh. BSE Members can start trading with Rs 7.50
lakh(Rs.2.5 lakh in cash, balance Rs. 5.00 lakhs as a combination of cash
equivalent and specified demat securities (subject to maximum of Rs. 2.50
lakhs after valuation)
** The specified initial margin range should be for a period of at least one
continuous month
*** Subject to bank operating powers and banker’s certificate on credit limits
for the bank account
Reporting
SHCIL provides various reports relating to the trading and settlement of its
clients on its website .These reports can be downloaded by the client by using
a unique PIN number and password. The main reports that are provided are :
Non-resident Indian
Introduction
Over the years, SHCIL has grown to become a major player in the
capital market. With a network of more than 120 offices operating
across the country and franchisees operating abroad, SHCIL
provides Depository Participant and related services close to 0.7
million satisfied investors out of which over 6000 are NRI Clientele.
SHCIL has a full fledged NRI cell operating specifically to cater needs
pertaining to Depository account opening and maintenance. NRI cell co-
ordinates with prospective NRI customers, collects and assists in obtaining
the relevant documents and ensures the Depository Account is opened hassle
free.
NRI Cell collects physical certificates to be sent for demat and ensures that
the certificates are in order and can be sent for dematerialisation under the
existing guidelines issued by the depositories. Instructions for trade are
accepted by fax on request by NRI Cell to ensure timely settlement of trades.
In this case later on the client needs to regularize by sending the original trade
delivery instruction. Any tariff and billing related query are addressed by NRI
Cell. In short NRI Cell is a single point contact for any matter relating to NRI
Depository operations.
Open account
Copy of RBI approval is not mandatory and the standing instruction for
automatic credits may be marked as 'Y' without furnishing RBI
approval. However, the onus of reporting to RBI is on the client.
Proof of identity by way of Copy of your Passport and Bank Account
attestation is compulsory.
Initial the agreement on the front side and sign in the order of holders
in the backside of the agreement
Where the account is being opened by POA(proof of address)
o The POA shall sign at all places in lieu of the original holder(s).
However, the photographs will be those of the original holder(s)
only.
o A certified true copy of the POA has to be provided with the account
opening form along with the signature and photograph of the POA.
o The account may be operated either by the original holder or by the
POA.
Nomination
Custodial
Introduction
With almost 70% of the Institutional business in its fold, SHCIL has evolved
over the times to meet the changing requirements of dynamic markets and
demanding clients.
In terms of collective man-years, SHCIL has the most experienced team in the
entire Industry.
Settlement services
Institutional trades are either settled through the Clearing House of the Stock
Exchanges or as DVP directly with the contracting broker or Counter Party. As
a Custodian SHCIL strives for timely settlement of Funds and Securities.
Funds are collected/ deposited from/to client and settled with the Clearing
Houses/ Brokers/ Counter Parties.
In the present context, most of the Institutional trades are settled in the
Depository mode. For the Institutional segment alone, SHCIL has a unique
clearing code on the two principal stock exchanges and separate DPM units
on both NSDL and CDSL.This ensures smooth settlement of transactions on
both Exchanges/Depositories, based on the deliverables and receivables
received by them for each settlement.
For the occasional delivery and receipt of securities in the physical mode,
SHCIL ensures prompt scrutiny, processing and lodgment of securities with
the respective Company/Registrar and Transfer Agent, with the objective of
final transfer to the purchaser, with objections handling if needed, thus
facilitating delivery of securities to the parties concerned on sale.
Institutional DP services
A dedicated Institutional DP team at SHCIL addresses your need for all core
DP services like conversion of physical holdings into electronic form,
settlement of trade instructions, rematerialisation, repurchase and pledge
instructions, providing of holding and transaction statements and daily
reconciliation of client holdings.
The Corporate Actions team ensures timely collection of monetary and non-
monetary benefits on behalf of the client. It covers all activities relating to
Corporate Actions like calculation of entitlements, reconciling with
companies/registrars prior to due date, collection of monetary Corporate
Actions from the premises of the company/registrar and transfer of the same
to clients. In case of any shortage, active follow up is done with each
company. Customized reporting to clients on the status of Corporate Actions
is done periodically.
The Primary Markets team takes care of applications on behalf of clients for
primary market issues, calculates the entitlements, follows up for allotment or
refunds and sends customized reports to clients.
Swot analysis
SWOT ANALYSIS
STRENGTHS:
1. SHCIL is the first depository participant. It has the opportunity of
holding more than 7000000 accounts at all centers.
2. Multiple products and services: SHCIL provides a variety of services
under the same roof.
3. It is the member of both NSDL and CDSL.
4. The company has more than 100 branches all over the world. It is very
much accessible to the clients.
5. The company has highly computerized, state of art technology to
facilitate the business and minimize the risk from automated
operations.
6. The company has to its credit 70% of the institutional business.
WEAKNESS
1. Improper or insufficient credit collection procedure, which has resulted
in a large amount or receivables.
2. The clients are not provided any incentives or motivations, which would
encourage them to make timely payment.
3. The company has not undertaken sufficient steps to create awareness
among the clients about SHCIL. The only procedure adopted is the
Internet.
4. The company has also failed in creating awareness among the clients
regarding the necessity of updating the information with regard to their
address, which makes some of the services rendered by the company
futile.
5. The HR department is placed in Mumbai. So the newly recruited
employees lack sufficient training facilities.
OPPORTUNITIES
1. The company can take steps to increase the awareness among the
clients and thereby increase the business.
2. The company has regularly come with new products and services in
order to proceed ahead of its competitors.
3. The company can attract more number of franchises.
THREATS
1. The number of competitors is increasing at a higher rate. Their charges
are also low when compared to the charges of SHCIL. The nearest
competitors are banks providing DP services along with their regular
services.
2. The company does not charge any amount for closing the account.
Since retaining the customer is very important and most of the
customers will not think of closing the account at time of opening the
account the company can charge some for closure.
3. The discounts and offers given by other DP’s when compared to offers
of SHCIL are leading to reduction in the number of clients.
Methodology
Methodology
internet.
Software used for data analysis MSexcel
For the purpose of secondary data books, articles, reports, annual reports
of the stock exchanges, news papers, CD-ROM, Internet, Nifty, BSE, BGSE,
are planned to be used.
Analysis &
Interpretation
Alliance Business Academy 86
Stock Holding Corporation of India Limited
ANALYSIS
20-30 8 20
30-40 12 30
40-50 16 40
50 & above 4 10
Total 40 100
Table No: 1
45
dents
40
35
Alliance Business Academy 88
30
Stock Holding Corporation of India Limited
Graph No: 1
Analysis: From the above table we can see that the normal range of
Depository Holders age varies between 20-50 yrs, with the highest 40% falling
between 40-60 followed by 30% falling between 30-40 and 20% between the
age group 20-30 and the lowest is 60 & above.
Inference: 40% of brokers and investors fall in the age group 40-60yrs.
Particulars Frequency %
Yes 32 80
No 8 20
Total 40 100
Table No: 2
20
yes
no
80
Graph No: 2
Analysis: From the above Graph it can be analyzed that 80% of the
respondents are Stock Holders. Remaining 20% of the respondents are not.
Years Frequency %
0-5 16 40
5-10 12 30
10-15 8 20
15-20 4 10
Total 40 100
Table No: 3
Graph showing the No. of years the respondents holding and trading in
SHCIL
40
35
30
Graph No: 3 25
Responde
20
Analysis: From the above it can be analyzed that the company has been
nts
grown well from past 5 to 10 yrs. 30% of the people are trading from 5-10
years & 40% from 0-5 years.
15
Inference: 40% of the Depository Holders are trading between 0-5 years.
10
4. Table showing how secure the securities in opting the demat.
Particulars Frequency 5
Percentage
Excellent 24 60
Very Good
Good
8
6
20
15
0
Average 2 5 0-5yrs
Total 40 100
Table No: 4
60 60
50
40
Graph No: 4
30
Analysis: From the above table survey inferred that 60% of the Depository
Holders are giving their consent as excellent about Demat. That is the
20
securities of the shareholders in electronic form is more safe and secured. 20
Inference:
10
Dematerialization plays a major role in providing safety and
security to the holders.
0
Excellent
5. Table showing the most preferred DP Product
Very
Particulars
Broking/Internet
Frequency
8
Percentage
20 Good
Trading
Mutual Funds 16 40
Government Bonds 8 20
Insurance 8 20
Total 40 100
Table No: 5
40 40
30
20 20
20 20
10
Broking/Interne
ernet Trading
Mutual Funds
Govt.Bonds
0
Insurance
t
Graph No: 5
Analysis: The above survey reveals that 40% of the holders are interested to
invest their savings in Mutual funds because they are less risky. The
Government bonds, Broking, & Insurance constitute the next preferred DP
product.
Table No: 6
10
10 Newspapers
40
Magazins
Word of mouth
Internet
40
Graph No: 6
Analysis: From the above survey it is revealed that the information about the
SHCIL is more effective through Internet and Word of mouth, i.e. the 40%
from Internet & 40% from Word of mouth, 10% is followed by Newspapers &
10% by Magazines
Table No: 7
50 50
50
40
30
20
10
0
BSE NSE
Graph No: 7
Inference: Both NSE & BSE are equally preferred for trading purpose,
accounting for 50% each of the responses.
Table No: 8
30
25
Alliance Business Academy 95
Stock Holding Corporation of India Limited
Graph No: 8
Analysis: From the above table it can be inferred that equal number of
respondents i.e. 30% each consider Returns and Safety as important
attributes followed by other attributes such as 20% each consider Quality of
service and Market updates.
Table No: 9
40
40
35
30
30
25
20
20
15
10
10
5
0
Equity Mutual Bonds Others
Shares Funds
Graph No: 9
Analysis: Majority 40% of the investors are having the habit of investing in
the Equity shares, 30% of them have invested in Mutual funds and 20% are
invested in Bonds & 10% in others.
Inference: Equity shares are the best options for investment in which
investors are preferring it first.
Yes 16 40
No 24 60
Total 40 100
Table No: 10
Graph No: 10
Analysis: From the above table we can analyze that 60% of the Depository
holders are not satisfied with the services. Out of 100 only 40% of investors
are accepted as Tailor made services.
Inference: From the above analysis we can infer that majority of investors
will expect better service.
Table No: 11
45 40
40
35
30
25 Graph No: 11 20
Analysis:
20From the above table we can analyze that the 40% of the
respondents says that the value-added services provided by SHCIL is through
15
online transaction, 30% by website, 20% E-mails, 10% portfolio updates.
10
Inference: Majority of the respondents accept that the value-added services
5
are through online transaction updates.
0
12. Table showing how satisfying is SHCIL in terms of Infrastructure
& the hardware, software installed for serving clients
Table No: 12
Graph No: 12
Analysis: The above survey reveals that the Depository holders are satisfied
in terms of infrastructure and software with the result of 30% as excellent,
50% as Very good followed by 15% as Good and 5% as Average.
13. Table showing how efficient & effective the DP services of SHCIL
compared to other financial institutions
Table No: 13
60
50
50
40
Alliance Business Academy 100
Stock Holding Corporation of India Limited
Graph No: 13
Analysis: From the above table it is analyzed that 50% of respondents are
agreed as excellent & more effective DP services in SHCIL when compare to
other institution.
40% of respondents agreed as Very good, 10% as Good & 0% as average.
14. Table showing how satisfactory are the interest rates in terms of
loan against demat held in DP.
Yes 16 40
No 24 60
Total 40 100
Table No: 14
Graph No: 14
Analysis: From the above table it is analyzed that 60% of respondents are
not satisfied with interest rates in terms of loan against demat.
Inference: Through the graph we can say that the interest rates are high.
Table No: 15
10
Alliance Business Academy 102
Stock Holding Corporation of India Limited
Graph No: 15
Analysis: From the table it is analyzed that 90% of Depository holders are
feeling that demat is safe & secure, whereas only 10% are feeling unsatisfied.
High 24 60
Reasonable 16 40
Low 0 0
Total 40 100
Table No: 16
70
60
60
Alliance Business Academy 103
Stock Holding Corporation of India Limited
Graph No: 16
Analysis: From the above survey it has inferred that 60% of respondents are
feeling that the service charges charged by SHCIL is high, and 40% as
reasonable, 0% as low.
Inference: Majority that is 60% of respondents are not satisfied with service
charges.
17. Table showing how effective the SHCIL in settling the stock.
Fast 20 50
Slow 20 50
Total 40 100
Table No: 17
60
50
50 Alliance Business Academy 104
Stock Holding Corporation of India Limited
Graph No: 17
Analysis: From the above table it can be interred that 50% of the
respondents are telling fast in settling the stock & other 50% are telling slow in
settling.
Table No: 18
60
50
50
Alliance Business Academy 105
Stock Holding Corporation of India Limited
Graph No: 18
Analysis: The responses to the On-line trading ranges between ‘Good’ and
‘Excellent’, 100% of the respondents record their responses between ‘Good
and Excellent.
Summary of Findings
FINDINGS
Based on the data analysis and interpretation, the following findings noted:
• 20% of the respondents, who are not stock holders are under the age
group of 20-30 and 50 and above.
• Out of the entire DP holders 10% of them trading in 15-20 years, 20%
are 10-15 years, 30% are 5-10 years, 40% are 0-5years. This
indicates the popularity of the organization in the last 10 years, during
which time 70% of the existing members are trading from
• 0-5 years, whereas the previous 10 years the total percentage is only
30%. This indicates a healthy trend form last 10 years.
• The survey indicates the trading is equally shared between BSE and
NSE.
Therefore it is essential for the company to give more priority about Safety
and Security and returns.
• Though the Equity shares has got the highest risk, the investors are
willing to take risk by investing in Equity shares for higher returns since
the SHCIL is doing well.
• The investors feel that the Interest rates provided or charged by SHCIL
is high against demat held in DP.
• The survey indicates that the investors are more safe and secured from
the demat in SHCIL
Recommendations &
Conclusion
RECOMMENDATIONS
• Since the Investors expect better service form SHCIL, it should provide
value-added services.
• The online trading efforts must be made more scientific and effective.
Conclusion
Working at SHCIL and preparing this project report was a learning experience
and I shall make immense use of it in my career.
ANNEXURE.1
BIBLIOGRAPHY
BOOKS:
MAGAZINES:
• Dalal Street
• Business today
• Money
• Business India.
NEWS PAPERS:
INTERNET / WEBSITE
WWW.google.com
WWW.online.stockholding.com
WWW.Sharekhan.com
ANNEXURE.2
QUESTIONNAIRE
3. Sex
Male Female
4. Occupation
40.50 50-60
Yes No
7. Since how long are you holding and trading the securities in SHCIL?
0-5yrs 5-10yrs
10-15yrs 15-20yrs
Good Average
• Broking/Internet trading
• MF Mobilization
• Government Bonds
• Insurance
• Newspaper
• Magazines
• Word of mouth
• Internet
• Mutual Funds
• Government Bonds
• Equity Shares
• Others Specify
Yes No
• Quality of Service
• Market Updates
• Returns Provided
• Safety and Security
15. How satisfying is SHCIL in terms of Infrastructure and the hardware and
software installed for serving its clients?
Good Average
16. How efficient and effective is the DP services of SHCIL when compared
to other financial institution?
Good Average
17. The loan against demat shares held in the DP a/c with SHCIL is
satisfactory in terms of interest rates
Yes No
Yes No
Fast Slow
Good Average