A SUMMER TRAINING PROJECT REPORT

ON

STOCK MARKET IN INDIA AN EMPIRICAL STUDY

SHARE KHAN LTD.

SUBMITTED IN PARTIAL FULFILLMENT OF THE

REQUIREMENTS FOR THE AWARD OF THE DEGREE OF THE
BACHELOR OF BUSINESS ADMINISTRATION

Submitted To: Submitted by:

Ms. Divya Tanishka Bhagotra
Roll No.: 43216701716

SIRIFORT INSTITUTE OF
MANAGEMENT STUDIES

0
 DECLARATION

I, hereby declare that the Summer Training Project Report, entitled STOCK

MARKET IN INDIA AN EMPIRICAL STUDY is an authentic work carried out

by me at SHARE KHAN LTD. It has not been submitted earlier for award of any

degree or diploma to any institute or university.

Place: New Delhi Candidate’s signature

Date: Tanishka Bhagotra

Roll No.: 43216701716

Countersigned

Name :
Supervisor

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 ACKNOWLEDGEMENT

It is my pleasure to be indebted to various people, who directly or indirectly contributed in

the development of this work and who influenced my thinking, behaviour and acts during

the course of study.

I express my sincere gratitude to Ms. Divya the worthy Director of Sirifort Institute Of

Management Studies, for providing me an opportunity to undergo summer training of

doing this project under his leadership.

I am thankful to Divya for her support, cooperation and motivation provided to me during

the training for constant inspiration, presence and blessings at SHARKHAN LTD.

I also extend my sincere indebtedness to Ms. Divya who provided his/her valuable

suggestion and precious time in accomplishing my project.

I also take the opportunity to express my sincere gratitude to each and every person, who

directly or indirectly helped me throughout the project and without anyone of them this

project would not have been possible.

The immense learning from this project would be indelible forever.

Tanishka Bhaogtra

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 EXECUTIVE SUMMARY

No professional curriculum is considered complete without work experience. It is well

evident that work experience is an indispensable part of every professional course. In the
same manner practical work in any organization is must for each an every individual, who
is undergoing management course. Without the practical exposure one cannot consider
himself as a qualified capable manager.

Entering in the organization is like stepping into altogether a new world. At first,
everything seems strange and unheard but as the time passes one can understands the
concept and working of the organization and thereby develop professional relationship.

Initially it is felt that as if classroom study was irrelevant and it is useless in any concern
working. But gradually it is realize that all fundamental basic concepts studied are linked
in one or other ways to the organization. But how and what can be done with fundamentals
depends upon the intellectual and applicability of an individual.

During my summer training period a specific customer survey was assigned which allow
me to have full market exposure.

This project will help me to understand and cope up with different types of people and
there diversified needs.

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 TABLE OF CONTENTS
S.No. Topic Page No
1 Certificate
2 Declaration
3 Acknowledgement
4 Executive Summary
5 Chapter-1: Introduction
 Overview of Industry as a whole
 Profile of the organization
 History of the Organization
 Competitor’s Information
 S.W.O.T Analysis of the Organization
 Objectives of the study
 Scope of the study
 Methodology
8 Chapter-2: Conceptual Framework
 Main topics & Sub Topics

6 Chapter-3: Data Analysis and interpretation

 Only in case of primary data

7 Chapter-4: Summary and Conclusion

 Results of the study

 Limitations

 Suggestions and Recommendations

8 Bibliography -
9 Appendix -

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 CHAPTER-1
INTRODUCTION

5
OVERVIEW OF INDUSTRY AS A WHOLE

Evolution

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).
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.

Other leading cities in stock market operations

Ahmedabad gained importance next to Bombay with respect to cotton textile industry.
After 1880, many mills originated from Ahmedabad and rapidly forged ahead. As new

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mills were floated, the need for a Stock Exchange at Ahmedabad was realized and in 1894
the brokers formed "The Ahmedabad Share and Stock Brokers' Association".
What the cotton textile industry was to Bombay and Ahmedabad, the jute industry was to
Calcutta. Also tea and coal industries were the other major industrial groups in Calcutta.
After the Share Mania in 1861-65, in the 1870's there was a sharp boom in jute shares,
which was followed by a boom in tea shares in the 1880's and 1890's; and a coal boom
between 1904 and 1908. On June 1908, some leading brokers formed "The Calcutta Stock
Exchange Association".
In the beginning of the twentieth century, the industrial revolution was on the way in India
with the Swadeshi Movement; and with the inauguration of the Tata Iron and Steel
Company Limited in 1907, an important stage in industrial advancement under Indian
enterprise was reached.
Indian cotton and jute textiles, steel, sugar, paper and flour mills and all companies
generally enjoyed phenomenal prosperity, due to the First World War.
In 1920, the then demure city of Madras had the maiden thrill of a stock exchange
functioning in its midst, under the name and style of "The Madras Stock Exchange" with
100 members. However, when boom faded, the number of members stood reduced from
100 to 3, by 1923, and so it went out of existence.
In 1935, the stock market activity improved, especially in South India where there was a
rapid increase in the number of textile mills and many plantation companies were floated.
In 1937, a stock exchange was once again organized in Madras - Madras Stock Exchange
Association (Pvt) Limited. (In 1957 the name was changed to Madras Stock Exchange
Limited).
Lahore Stock Exchange was formed in 1934 and it had a brief life. It was merged with the
Punjab Stock Exchange Limited, which was incorporated in 1936.

Indian Stock Exchanges - An Umbrella Growth

The Second World War broke out in 1939. It gave a sharp boom which was followed by a
slump. But, in 1943, the situation changed radically, when India was fully mobilized as a
supply base.

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On account of the restrictive controls on cotton, bullion, seeds and other commodities,
those dealing in them found in the stock market as the only outlet for their activities. They
were anxious to join the trade and their number was swelled by numerous others. Many
new associations were constituted for the purpose and Stock Exchanges in all parts of the
country were floated.
The Uttar Pradesh Stock Exchange Limited (1940), Nagpur Stock Exchange Limited
(1940) and Hyderabad Stock Exchange Limited (1944) were incorporated.
In Delhi two stock exchanges - Delhi Stock and Share Brokers' Association Limited and
the Delhi Stocks and Shares Exchange Limited - were floated and later in June 1947,
amalgamated into the Delhi Stock Exchange Association Limited.
Most of the exchanges suffered almost a total eclipse during depression. Lahore Exchange
was closed during partition of the country and later migrated to Delhi and merged with
Delhi Stock Exchange.
Bangalore Stock Exchange Limited was registered in 1957 and recognized in 1963.
Most of the other exchanges languished till 1957 when they applied to the Central
Government for recognition under the Securities Contracts (Regulation) Act, 1956. Only
Bombay, Calcutta, Madras, Ahmedabad, Delhi, Hyderabad and Indore, the well established
exchanges, were recognized under the Act. Some of the members of the other Associations
were required to be admitted by the recognized stock exchanges on a confessional basis,
but acting on the principle of unitary control, all these pseudo stock exchanges were refused
recognition by the Government of India and they thereupon ceased to function.

Thus, during early sixties there were eight recognized stock exchanges in India (mentioned
above). The number virtually remained unchanged, for nearly two decades. During
eighties, however, many stock exchanges were established: Cochin Stock Exchange
(1980), Uttar Pradesh Stock Exchange Association Limited (at Kanpur, 1982), and Pune
Stock Exchange Limited (1982), Ludhiana Stock Exchange Association Limited (1983),
Gauhati Stock Exchange Limited (1984), Kanara Stock Exchange Limited (at Mangalore,
1985), Magadh Stock Exchange Association (at Patna, 1986), Jaipur Stock Exchange
Limited (1989), Bhubaneswar Stock Exchange Association Limited (1989), Saurashtra
Kutch Stock Exchange Limited (at Rajkot, 1989), Vadodara Stock Exchange Limited (at

8
Baroda, 1990) and recently established exchanges - Coimbatore and Meerut. Thus, at
present, there are totally twenty one recognized stock exchanges in India excluding the
Over the Counter Exchange of India Limited (OTCEI) and the National Stock Exchange
of India Limited (NSEIL).
The above data portrays the overall growth pattern of Indian stock markets since
independence. It is quite evident from the data that Indian stock markets have not only
grown just in number of exchanges, but also in number of listed companies and in capital
of listed companies. The remarkable growth after 1985 can be clearly seen and this was
due to the favouring government policies towards security market industry.

NATIONAL STOCK EXCHANGE (NSE)

The National Stock Exchange of India (NSE) was incorporated in November 1992 as a tax-
paying company. It is recognized under Securities Contracts (Regulation) Act, 1956 in
1993 as a stock exchange. In June 1994, it commenced operations in the Wholesale Debt
Market (WDM). In November, the same year, the Capital Market (Equities) segment
commenced operations and the Derivatives segment in June 2000.

BOMBAY STOCK EXCHANGE (BSE)

A very common name for all traders in the stock market, BSE, stands for Bombay Stock
Exchange the oldest market not only in the country, but also in Asia. The early days of
BSE was known as "The Native Share & Stock Brokers Association." It was established in
the year 1875 and became the first stock exchange in the country to be recognized by the
government. In 1956, BSE obtained a permanent recognition from the Government of India
under the Securities Contracts (Regulation) Act, 1956.

In the past and even now, it plays a pivotal role in the development of the country's capital
market. This is recognized worldwide and its index, SENSEX, is also tracked worldwide.
Earlier it was an Association of Persons (AOP), but now it is a demutualised and
corporatised entity incorporated under the provisions of the Companies Act, 1956, pursuant

9
to the BSE (Corporatisation and Demutualization) Scheme, 2005 notified by the Securities
and Exchange Board of India (SEBI).

The Share Market can be segmented in two parts: -

 Primary Market
 Secondary Market

Primary Market

It provides opportunity to issuers of securities government as well as corporate to raise

resources to meet their requirements of investments. In this market companies issue fresh
security in exchange of funds through public issues or private placements. The market
design for primary market is provided in the provision of Companies Act, 1956 which deals
with issues, listing and allotment of securities. The investors have to apply the shares by
filling the application form issue by the company along with the application money.
According to Disclosure and Investor Protection guidelines of SEBI, 1992 company has to
disclose all the necessary information regarding pricing of issues, listing requirements,
disclosure norms lock-in-period for promoters contribution, contents of offer documents
pre and post issue obligations etc.
Company can issue shares at face value, at premium or at discount. Another method of
pricing which is now days common is issuing the securities through online system of the
stock exchange has to comply with the section 55 to 68a of the companies Act, 1956 and
SEBI guidelines 2000. The company is required to enter in to an agreement with the stock
exchanges, which have the requisite system for online offer of securities. The advantages
for this new system are: -

 The investors part with money only after allotment.

 It eliminates refunds except in case of direct applications.
 It reduces the time taken for issue process
Secondary Market

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Secondary market is the place for sale and purchase of existing securities. It enables an
investor to adjust his holdings of securities in response to changes in his assessment about
risk and return. It enables him to sell securities for cash to meet his liquidity needs. It
essentially comprises of the stock exchanges which provide platform for trading of
securities and a host of intermediaries who assist in trading of securities and clearing and
settlement of trades. The securities are traded, cleared and settled as per prescribed
regulatory framework under the supervision of the exchanges and oversight of SEBI.

Trading Mechanism

Earlier trading on stock exchanges in India used to take place through open without use of
information technology for immediate matching or recording of trades. This was time
consuming and inefficient. This imposed limits on trading volumes and efficiency. In order
to provide efficiency, liquidity and transparency National Stock Exchange introduced a
nation wide on line fully automated screen based trading system where a member can
punch in to the computer quantities of securities and the prices at which he likes to transact
and the transaction is executed as soon as it finds a matching sale or buy order from a
counter party. Screen based trading electronically matches orders on a price/time priority
and hence cuts down on time, cost and risk of error, as well as on fraud resulting in
improved operational efficiency. It enables market participants, irrespective of their
geographical locations to trade with one another and it provides equal access to everybody.
NSE has main computer which is connected through Very Small Aperture Terminal
(VSAT) installed at its office. The main computer runs on a default tolerant STRATUS
mainframe computer at the exchange. Brokers have terminals installed at their premises,
which are connected through VSATs. An investor informs a broker to place an order on
his behalf.

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PROFILE OF THE ORGANIZATION

Share khan is one of the retail brokerage firms in the country. It is the retail broking arm
of the Mumbai based SSKI group, which has over eight decades of experience in the stock
broking business. Share khan offers its customers a wide range of equity related services
including trade execution on BSE, NSE, Derivatives, Depository services, online
trading, investment advice etc. Sharekhan is lead by a highly regarded management team
that has invested crores of rupees into a world class Infrastructure that provides our clients
with real-time service & 24/7 accesses to all information and products. Our flagship
Sharekhan Professional Network offers real-time prices, detailed data and news,
intelligent analytics, and electronic trading capabilities, right at your finger-tips. This
powerful technology is complemented by our knowledgeable and customer focused
Relationship Managers.

“Your guide to the Financial Jungle”

Sharekhan offers a full range of financial services and products ranging from Equities to
Derivatives enhance your wealth and hence, achieve your financial goals.
Sharekhan's Client Relationship Managers are available to you to help with your financial
planning and investment needs.

The Business Challenges

• Easily access customer portfolio information in a secure contact centre environment.

• Seamlessly integrate with back-end applications and streamline customer data to contact

Center agents.

• Easily manage upgrades and technology issues to accommodate growing customer base.

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HISTORY OF THE ORGANISATION

Sharekhan is the retail broking arm of SSKI, an organization with more than eight decades
of trust & credibility in the stock market.

• Amongst pioneers of investment research in the Indian market.

• In 1984 ventured into Institutional Broking & Corporate Finance.

• Leading domestic player in Indian institutional business.

• `ver US$ 5 billion of private equity deals.

Sharekhan has always believed in investing in technology to build its business. The
company has used some of the best-known names in the IT industry, like Sun
Microsystems, Oracle, Microsoft, Cambridge Technologies, Nexgenix, Vignette,
Verisign Financial Technologies India Ltd, Spider Software Pvt Ltd. to build its
trading engine and content.

Three component of company profile is Company, Competitor and Customer. And

these are as follows:-

1. Share khan proposal

Sharekhan is one of the leading retail brokerage firms in the country. It is the retail broking
arm of the Mumbai-based SSKI Group, which has over eight decades of experience in the
stock broking business.

Sharekhan offers its customers a wide range of equity related services including trade
execution on BSE, NSE, Derivatives, Depository services, Online Trading, Investment
Advice, Mutual Funds, Online IPO's etc.

2. Innovation

(a.)The firm's online trading and investment site-www.Sharekhan.com-was launched on

Feb 8, 2000. The site gives access to superior content and transaction facility to retail

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customers across the country.

(b.) On April 17, 2002 Sharekhan launched Speed Trade, a net-based executable
application that emulates the broker terminals along with host of other information relevant
to the Day Traders. In the last six months Speed Trade has become a de facto standard for
the Day Trading community over the net.

3. Network

The number of trading members currently stands at over 6 lacs. While online trading
currently accounts for just over 2 per cent of the daily trading in stocks in India, Sharekhan
alone accounts for 32 per cent of the volumes traded online.

The objective has been to let customers make informed decisions and to simplify the
process of investing in stocks.

Share khan’s ground network includes over 588 centers in 148 cities in India, of which
32 are fully-owned branches.

4. Stakeholder

The Morakhiya family holds a majority stake in the company. HSBC, Intel & Carlyle are
the other investors.

5. Experience

With a legacy of more than 80 years in the stock markets, the SSKI group ventured into
institutional broking and corporate finance 18 years ago.

SSKI's institutional broking arm accounts for 7% of the market for Foreign Institutional
portfolio investment and 5% of all Domestic Institutional portfolio investment in the
country.

It has 60 institutional clients spread over India, Far East, UK and US. Foreign Institutional
Investors generate about 65% of the organization's revenue, with a daily turnover of over
US$ 2 million.

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6. Awards

Sharekhan company has got three awards:-

i. Awaaz award from CNBC Channel in 2004.

ii. Best Preferred Brokerage House Award from CNBC Channel in 2005.

iii. Awaaz award in 2006.

7. Products offered by Share khan

i. BOLT for offline trading.

ii. NEAT for online trading.

iii. Portfolio Management Services.

iv. Offline Trade in Commodities.

v. Mutual Fund Advisory

8. Reasons to choose Share khan Limited

Experience

SSKI has more than eight decades of trust and credibility in the Indian stock market. In the
Asia money broker’s poll held. SSKI won the ‘India’s best broking house for 2004’ award.
Ever since it launched Sharekhan as its retail broking division in February 2000, it has been
providing institutional level research and broking service to individual investors.

Technology

With their online trading account you can buy and sell shares in an instant from any PC
with an Internet connection. You will get access to their powerful online trading tools that
will help you take complete control over your investment in shares.

Accessibility

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Sharekhan provides advice, education, tools and execution service for investors. These
services are accessible through their centers across the country, over the country as well as
over the voice tool.

Knowledge

In a business where the right information at the right time can translate into direct profits,
you get access to a wide range of information on their content-rich portal, sharekhan.com.
You will also get a useful set of knowledge-based tools that will empower you to take
informed decisions.

Convenience

You can call their Dial-N-trade number to get investment advice and execute your
transactions. They have a dedicated call-center to provide this service via a toll free number
from anywhere in India.

Customer Service

Their customer service team will assist you for any help that you need relating to
transactions, billing, demat and other queries. Our customer service can be contracted via
a toll free number, email or live chat on sharekhan.com.

Investment Advice

Sharekhan has dedicated research teams for fundamental and technical research. Their
analysis constantly track the pulse of the market and provide timely investment advice to
you in the form of daily research emails, online chat, printed reports and SMS on your
phone.

9. Benefits provide by the company

a) Free Depository A/C,

b) Secure Order by Voice Tool Dial-n-Trade,

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 c) Instant cash transformation,

d) Multiple banking option,

e) Automated portfolio to keep track of the value of your actual purchases,

f) 24 x 7 voice tool access to your trading account,

g) Special personal inbox for order and trade confirmations,

h) On line customer service via web chat,

i) Buy or sell even single share,

Personalized price and account alerts delivered instantly to your cell phone and e-mail
address.

COMPETITOR’S INFORMATION

The major brokerage firms:

 Religare.in

 5paisa.com

 KotakStreet.com

 IndiaBulls.com

 ICICIDirect.com

 HDFCsec.com

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“R-ACE”
R-ACE stands for (RELIGARE - ADVANCED CLIENT ENGINE).
It is a 360˚ online investment platform that allows users to invest in
 Equities,
 F&O,
 Commodities,
 IPO and
 Mutual Funds.
It not only saves a lot of time and energy, but also does away with all the tedious paper
work involved with these kinds of investments. The result is a completely hassle free
investing experience.
Platforms
Depending on client’s requirements we have three platforms to offer for online trading:

1. R-ACE (Basic Version): This is a browser based online trading platform with all
the basic features required to make transaction using Internet Explorer.
o Account Opening Charges: Rs. 299
o Initial margin: Rs 5000

2. R-ACE Lite (Applet Version): This is a browser based version with streaming
quotes facility which will help the client to monitor the market and make quick buy and
sell transactions.
o Account Opening Charges: Rs. 499
o Initial margin: Rs 5000

3. R-ACE Pro (Application Version): This is a trading terminal with streaming

quotes, technical charting and many advanced features. The trading terminal can be
downloaded from the website and can be run from any location.
o Account Opening Charges: Rs. 999
o Initial margin: Rs. 10000

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 Note: The client has to maintain minimum cash margin of Rs. 500 at all times in all
the three platforms.
Salient Features

1) Delivery:

i. Exposure in delivery would be 1 times of available cash margin;

ii. Buying allowed in all scrips except ‘Z’ category shares and physical shares;
iii. Selling allowed in all scrips available in DP-POA or Beneficiary. Shares would be
compulsorily sent to DP-POA (in instances where the client has bought today and
sold tomorrow, his scrips would lie in beneficiary);
iv. Credit for sale would be provided to client
v. Futures & Options Margin to be calculated on SPAN Margin

2) Intraday:

i. Exposure in intra-day would be 6 times (20 times exposure in special product

offering Race MaxTrade).
ii. Clients will get intraday exposure on their holdings in Demat account (valued after
applicable haircut).
iii. Select scrips would be allowed for intra-day trading.
iv.Auto-square-off of all intraday orders at 3:10.pm.

3) Online Equity, Mutual Fund1, IPO* and Commodities* in a single a/c.

4) 3% rate of interest on the margin deposited.
5) Lifetime free DP. ( No Annual maintenance charges)
6) NSE cash segment, NSE F&O and BSE on single platform.
7) Online transfer of funds through multiple banks.(ICICI, UTI, HDFC & CITI)
8) Minimal Brokerage as low as 0.01% & 0.1% (Under special scheme)

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9) Technical charting (Intraday and End Of Day )
10) Integrated DP, back office and trading account.
11) Obligation selling allowed (in selected scrips).

Brokerage Schemes:

RACE Classic Scheme

This is a purely volume based brokerage plan and brokerage chargeable will be as follows:

Monthly Traded Volume Intraday Delivery

Less than 1 Crore 0.05% 0.50%
1 Crore – 5 Crore 0.04% 0.40%
More than 5 Crore 0.03% 0.30%

“5 PAISA”

Company Background

Indiainfoline was founded in 1995 and was positioned as a research firm .In 2000 e-broking
was started under the brand name of 5 paisa. Com Apart from offering online trading in
stock market the company offers mutual funds online. It also acts as a distributor of various
financial services i.e. Company Fixed Deposits, Insurance.
Limited ground network, present in 20 Cities

Online Account Types

• Investor Terminal: Investors / Students

• Trader Terminal: Day Traders / HNI’s

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PRICING FOR RETAIL CLIENTS
Investor Terminal
• Account Opening: Rs 500

• Demat 1st Yr: Rs 250

• Initial Margin: Rs 2500(Compulsory)

• Min Margin Retainable: Rs 1000

•Brokerage:

Intraday 0.10% each side + ST

Delivery 0.50% each side + ST

PRICING FOR HNI CLIENTS

Trader Terminal

• Account Opening: Rs. 500

• Demat 1st Yr: Rs. 250

• Initial Margin: Rs. 5000(Compulsory)

• Min Margin Retainable: Rs. 1000

Brokerage:

Intraday 0.10% each side + ST

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 Delivery 0.50% each side + ST
(Negotiable to 0.05% each side & 0.25%)
Account Access Charges
Monthly Rs 800, adjustable against Brokerage
Yearly Rs 8000, adjustable against brokerage
“Kotakstreet”
Company Background

Kotakstreet is the retail arm of Kotak securities. Kotak Securities limited is a joint
venture between Kotak Mahindra Bank and Goldman Sachs.

Pricing For Kotak

Account Opening: Rs 500

Demat: Rs 22.5 p.m

Initial Margin: Rs 5000(Compulsory)

Min Margin Retainable: Rs 1000

Brokerage Slab wise:

Higher the volume, lower the brokerage. Even older customers (on 0.25% &
0.40%) have been moved to the slab wise structure w.e.f 1/4/2004

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 “INDIABULLS”

Company Background

An India bull is a retail financial services company present in 70 locations covering 62

cities. It offers a full range of financial services and Products ranging from Equities to
Insurance.450 + Relationship Managers who act as personal financial advisors.

Pricing of IB Accounts

(1) Signature Account

• Account Opening: Rs 250
• Demat: Rs 200, No AMC for this DP
• Initial Margin: NIL
Brokerage: (Negotiable)
Intraday 0.05%+ST
Delivery 0.25%+ST

(2) Power India Bulls

 Account Opening: Rs 750

 Demat: Rs200

 Initial Margin: NIL

 Brokerage: Negotiable

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 “ICICI Direct”

Company Background

ICICI Direct (or ICICIDirect.com) is stock trading company of ICICI Bank. Along with
stock trading and trading in derivatives in BSE and NSE, it also provides facility to invest
in IPO’s, Mutual Funds and Bonds. Trading is available in BSE and NSE.

Type of Account

1. Share Trading Account

Share Trading Account by ICICI Direct is primarily for buying and selling of stocks in
BSE and NSE.
This account allows Cash Trading, Margin Trading, Margin PLUS Trading, Spot Trading,
Buy Today Sell Tomorrow and Call and Trade on phone.
ICICIDirect.com website is the primary trading platform for this trading account. They also
provide installable application terminal based application for high volume trader.

2. Wise Investment Account

Along with stock trading and IPO investing in BSE and NSE, Wise Investment account
also provide options to invest in Mutual Funds and Bonds online.
Online Mutual funds investment allows investor to invest on-line in around 19 Mutual Fund
companies. ICICI Direct offers various options while investing in Mutual Funds like
Purchase Mutual Fund, Redemption and switch between different schemes, Systematic
Investment plans, Systematic withdrawal plan and transferring existing Mutual Funds in to
electronic mode. This account also provides facility to invest in Government of India
Bonds and ICICI Bank Tax Saving Bonds.
ICICIDirect.com website is the primary tool to invest in Mutual Funds, IPO’s, Bonds and
stock trading.

3. Active Trader Account

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Active Trader account gives more personalized investment options to the investors. It
allows investor to use online and offline stock trading. It also provides with independent
market expertise and support through a dedicated Relationship Manager from ICICI.
Active Trader also provides commodity trading.

Brokerage and fees:

Account opening fees: Rs 750/- (One time non-refundable)
Brokerage: ICICIDirect.com brokerage varies on volume of trade and inclusive of demat
transaction charges, service taxes and courier charges for contract notes. It ranges from
0.1% to 0.15% for margin trades, 0.2% to 0.425% for squared off trades and 0.4% to 0.85%
on delivery based trades.

How to open account with ICICI Direct?

For Online Stock Trading with ICICI, investor needs to open 3 accounts...ICICI Bank
Account, ICICI Direct Trading Account and ICICI Demat Account (DP Account).

Note: If you already have a bank account or demat account with ICICI, you could link it
with new ICICIDirect trading account.
Opening trading account with ICICI is easy. You could use one of the following options to
open account with ICICIDirect.
 Visit ICICIDirect.com and fill the "Open an Account" form.
 Call ICICI and tell them that you are interested in opening an account with them.
In both the cases ICICI representative contact you in a day or two and tell you about the
procedure to open the account. They usually send somebody to your home to collect
documents, signature and for demo if required.

25
 “HDFC Securities”

Company Background
The HDFC BANK, HDFC and Chase Capital Partners and their associates promote HDFC
SECURITIES LTD. They are Pioneers in setting up Dial-a-share services with the largest
team of Tele-brokers

Pricing of HDFC Account

Account Opening: Rs 750

Brokerage: (Negotiable)

Intraday 0.10%+ST

Delivery 0.50%+ST

26
SWOT ANALYSIS OF THE ORGANISATION

Strength Weakness

1. Low brokerage. 1. If a company share is listed in both the

exchange then customer can do buying or
2. Free Depository A/C.
selling through NSE.
3. On line Trading.
2. Customer satisfaction.
4. Highly Experience.
3. Branding.
5. Instant Cash transformation
4. Competition from banks
6. Brand image.

7. Better research team. etc.

Opportunity Threats

1. They can expand his business in many 1. Government policy, SEBI & Depository
areas where potential customer is waited. policy may be changes.

2. Due to experienced Research report 2. New competitors.

team they can enhance his business and 3. Technology based business.
change the mind set of customer due to risk
in share market.

27
OBJECTIVE OF THE STUDY

 To understand the reality behind a phenomenon. It involves a systematic

investigation involved to add to the available information through scientific
procedures.

 To focus on the investor preference to invest their money in these days.

 To focus on the problem that which investment instrument they used to invest their
money and what factor they consider like rate of return, liquidity, tax benefit, etc.

 The Broad objective of this project is to know about the customer preference in
different investment alternative. By this project I know also the time horizon for
investment and what factor affect in investment decision.

I have to be in regular contacts with our clients so that we come to know about the problem
they are facing.

 What are the features and services that influence the investor to invest their money?

 To know what are the expected return of the investors to invest their money in
capital market.

 Which factor they consider more while investing their money.

 Who influence their investing their money?

28
SCOPE THE STUDY
A thorough research and a detailed study of market are very important for the management
to take the right strategy suiting the market condition. The study gives the information
regarding the market completion, innovative products offered by competitors, present
demand of the product in the marketed

1. The study will help the management to understand the customer mind set and also
estimating the present and future market demand of the product.

2. It will help to estimate the level of awareness established in the market and in deciding
the extent of promotion required.

3. Help in finding the areas in which SHAREKHAN will concentrate to increase its market
share.

4. It will help in finding out the customer expectation about the product and also help to
know the customer physiology.

5. Helps in knowing the class on which max new SHAREKHAN must concentrate.

This study helps in finding the area in which SHAREKHAN in strong and the area in which
it lags behind others. Which class of customer mostly approaches SHAREKHAN polices?

29
METHDOLOGY

Research Methodology is a way to systematically study & solve the research problems. If
a researcher wants to claim his study as a good study; he must clearly state the methodology
adopted in conducting the research so that it may be judged by the reader whether the
methodology of work done is sound or not.

The research methodology here includes: -

1. Research Design

2. Universe and Survey population

3. Sample Design

4. Collection of Data

5. Analysis Pattern

Sample Design:-

The respondents selected should be as representative of total population as possible in order

to produce a miniature cross-section. The selected respondent constitute what is technically
called a 'sample' & the selection process is called 'sampling technique'. The survey so
conducted, is known as sample survey.

Sample chosen must be representative of universe to be studied & therefore, every care
must be taken in size may give better results the constraints like time and money comes to
limit the size of sample. So, besides, being care representative of the universe, a sample
should be convenient in terms of size. It should neither be too small nor too big. It should
be manageable.

30
There are various steps in Sampling Design:

a) Sampling Area:

Sampling area may be a geographical one as in this project New Delhi (Pitampura) is taken
in to consideration.

b) Source Unit:

In this project Sharekhan Ltd. is the sample unit.

c) Size of Sample:

It refers to the number of items to be selected from the universe to constitute a sample. It
is accepted that the bigger the size of the sample, the greater the representatives of whole
universe. A balance is to be maintained between sample size and time cost trade off.
Sample size has been restricted to 100 investor. However, it has been tried that all socio-
economic perspectives are well considered in the samples.

d) Sampling Technique:

The sampling technique used is the random sampling technique.

e) Data Sources

 Primary Sources

Questionnaire: - A questionnaire consists of a set of questions presented to respondent for

their answers. It can be Closed Ended or Open Ended

Open Ended: - Allows respondents to answer in their own words & are difficult to
Interpret and Tabulate.

Close Ended : - Pre-specify all the possible answers & are easy to Interpret and Tabulate.

31
TYPES OF OUESTION INCLUDED:

DICHOTOMOUS QUESTIONS

Which has only two answers “Yes” or “No”.

MULTIPLE CHOICE OUESTION

Where respondent is offered more than two choices.

 Secondary Sources

For the company information I had used secondary data like brochures, web site of the
company etc.

The Method used by me is Survey Method as the research done is Descriptive

Research.

I had used Secondary Data

32
 CHAPTER-2
CONCEPTUAL FRAMEWORK

33
Review of Existing Literature

According to the Webster’s dictionary, literature is “the writings that pertain to a

particular branch of learning, and printed matter”. And review means “to examine
again, to study carefully”.

Therefore literature review is the printed matter, which we study very carefully during our
work. This project is also a collection of insight into the different printed material.

As this project is specifically related to investor who invest their money using different
investment alternative like equity, mutual fund, banks, others.

The main source of data through which this project has taken its shape is the circulars of
SEBI. These circulars give description of existing market.

“INVESTMENT DECISION” is taken from “FINANCIAL MANAGEMENT” written

by D. K GOYAL. Purpose of this book is to provide background needed to understand
the basics concept of investment.

The study related to investment decision also helped me a lot to understand what factor an
investor considers for his investment.

“The concept and role of mutual funds” of the AMFI mutual fund testing programme by
association of mutual funds in India. This book provide concept of mutual funds.

Last but not the least, the practical experiences of Share-khan Ltd. has given the best ever
exposure on the actually market works in financial products and services.

Investing is not just putting money in some instrument for the future but it involves taking
careful steps to make money grow. When you invest, your goal is that its value will increase
over a period of time. There are large numbers of investment avenues available to invest
like stocks, real estate, bank deposits, government of India bonds, post office saving
schemes etc.

34
The investment vehicles available for one to choose today vary from money market
certificates (which earn set rates of interest) to high-risk growth stocks. Investing in any
instrument almost always involves some risk, but if you learn how to analyze investments
carefully and invest wisely over an extended period of time, investing is a proven way to
increase wealth. Careful analysis and proper investment steps improve once capability to
earn reward in the long run through investment alternatives available.

Investments are nothing but parking your savings into various instruments available which
suits the best risk and return appetite of the individual.

“Income – expenditure = Savings”

Savings are the difference between the net income and the total expenditure made.

Investment avenues and alternatives

INVESTMENT AVENUES AND ALTERNATIVES

Investment alternatives vary from fixed income to variable income which includes RBI
bonds, government securities, fixed deposit, equity investments, property and so on.

In recent years the 6.5 percent tax-free RBI Bonds have become a very popular saving
instrument -- especially amongst individuals. Till 1996, these bonds gave returns of 10 per
cent. This came down to 9 per cent and then 8 percent and then in 2003 it was reduced to
6.5 per cent (tax free). Nowadays, 8 percent taxable Government of India bonds are also
doing well to attract investors who want safe and higher yield.

However, with inflation at nearly 4.5%, the return offered by these instruments were still
attractive. However, with the scrapping of the tax-free bonds, safe investment options for
individuals have become very limited and people are now choosing to go with either post
office saving schemes or equity related instruments.

Take a look at what is happening. Debt funds, which were said to be relatively risk-free,
are giving very less returns. Monthly Income Plans offered by mutual funds are also not

35
attractive as their portfolio is made up of 80 percent debt and 20 percent equity. With debt
giving very less returns and returns from equity becoming stagnant, the returns from MIPs
are also very attractive. The returns offered by MIPs are totally dependant upon the type of
security and debt instruments held by the fund But with recent rally in the stock market,
very few people are now going for MIPs and have a very positive sentiment about the
market and would like to stay with the market for long. But continuously we still have a
single question in mind:

So where should individuals park their money now?

"The 8 per cent taxable RBI Bonds seem to be one of the best options right now looking
for a safe avenues."

The person in the 30 percent tax bracket, the 8 per cent RBI bonds will give returns of
approximately 5.6 per cent. Though this is much lower than the previous 6.5 percent, it is
still a better than most other options. If you are a senior citizen, the Senior Citizens Savings
scheme offering a 9 Percent yearly interest is a good investment option. The scheme was
announced in the Budget 2004-2005 and was meant for people above the age of 60.
However, this scheme has a maximum deposit limit of Rs. 15 lacs while RBI Bonds do not
have any limit. In this case, the term for deposit is five years with a facility for premature
withdrawal. The 9 percent returns are subject to tax, so if you are in the 30 percent tax
bracket, you will effectively get returns of 6.3 per cent.

Another option can be Floating Rate Bond Fund offered by mutual funds. Basically, these
funds invest in floating rate instruments and therefore have a direct correlation to interest
rates. If interest rates go up the returns from these funds rise and returns fall with a fall in
interest rates. This is unlike debt funds, where there is a reverse relationship between
interest rates and returns. A rise in interest rates results in a fall in returns. In the current
scenario, these funds are likely to give returns of 5 percent to 5.5 percent. The dividends
are tax-free in the hands of the investor and most importantly, there is complete liquidity.
Again, there is no limit on the amount that can be deposited. Also, there is hardly any
volatility making it a safe option. If you are willing to take a bit of risk, you can divide
your portfolio in such a way that 60 percent is invested in floating rate bond funds and the
remaining 40 percent in equity. That's like having an MIP except that instead of 80 percent

36
in debt and 20 percent in equity, here the 60 percent is in floating rate bond funds. Such a
portfolio can give you returns of aprox. 8.5 % to 9.5 %.

The NSCs and the Kisan Vikas Patras give returns of 8 percent so for those in the 30 percent
tax bracket, it works out to 5.6 percent. Here too there is no limit on the amount of deposit.
However, here the interest is posted only at the time of maturity. So it is not a good option
if you want regular returns. On the other hand, RBI Bonds give returns every six months
or half yearly. So, depending upon their risk profile and need for liquidity, one will have
to decide on their portfolio. For anyone below 35 years, it is recommend that one should
invest some part of there portfolio in RBI Bonds and in NSCs, KVPs as a long term
investments and the remaining in combination of floating rate bond funds and equity But
for those above 35,

It is advocate that one should look at nearly 40 percent in RBI Bonds, 30 percent in NSCs,
KVPs, hence giving safe and regular income. And the remaining 30 per cent in floating
rate bond funds and equity. For those above the age of 60, 40 percent must be put in the
Senior Citizens Scheme (of course, this is up to a maximum limit of Rs 15 lakh), another
40 percent in RBI Bonds and the remaining 20 percent in floating rate bond funds, so that
one has some liquidity.As an investor one has a wide array of investment avenues available
to one.

 Reduction in brokerage by many brokers for trading in dematerialized securities

Brokers provide this benefit to investors as dealing in dematerialised 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

37
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.

Disadvantages of Dematerialization

The disadvantages of dematerialization of securities can be summarized as follows:

A. Trading in securities may become uncontrolled in case of dematerialized

securities.

B. It is incumbent upon the capital market regulator to keep a close watch on the
trading in dematerialized securities and see to it that trading does not act as a
detriment to investors. The role of key market players in case of dematerialized
securities, such as stock-brokers, needs to be supervised as they have the capability of
manipulating the market.

C. Multiple regulatory frameworks have to be confirmed to, including the

Depositories Act, Regulations and the various Bye Laws of various depositories.
Additionally, agreements are entered at various levels in the process of
dematerialization. These may cause anxiety to the investor desirous of simplicity in
terms of transactions in dematerialized securities.

38
 SERVICES PROVIDED BY THE SHAREKHAN:--

 Online Services to Suit your Needs!

With a Sharekhan online trading account, you can buy and sell shares in an instant!
Anytime you like and from anywhere you like!
You can choose the online trading account that suits your trading habits and preferences -
the Classic Account for most investors and Speed trade for active day traders. Your
Classic Account also comes with Dial-n-Trade completely free, which is an exclusive
service for trading shares by using your telephone.

 #Freedom from paperwork  #Online orders on the phone

 #Instant credit and money transfer  #Timely advice and research reports

 #Trade from any net enabled PC  #Real-time Portfolio tracking

 #After hour orders  #Information and Price alerts

 Get everything you need at a Sharekhan outlet!

All you have to do is walk into any of share khan’s 640 share shops across 280 cities in
India to get a host of trading related services - their friendly customer service staff will
also help you with any accounts related queries you may have.

A Share-khan outlet offers the following services:

 Online BSE and NSE executions (through BOLT & NEAT terminals)

 Free access to investment advice from Sharekhan's Research team

39
 Sharekhan Value Line (a monthly publication with reviews of recommendations, stocks
to watch out for etc)

 Daily research reports and market review (High Noon & Eagle Eye)

 Pre-market Report (Morning Cupper)

 Daily trading calls based on Technical Analysis

 Cool trading products (Daring Derivatives and Market Strategy)

 Personalized Advice

 Live Market Information

 Depository Services: Demat & Remit Transactions

 Derivatives Trading (Futures and Options)

 Commodities Trading

 IPO’s & Mutual Funds Distribution

 Internet-based Online Trading: SpeedTrade

40
Investing in Mutual Funds through Sharekhan

Invest in Mutual Funds through Sharekhan! They have started this service for a few mutual
funds, and in the near future will be expanding their scope to include a whole lot more.
Applying for a mutual /fund through share-khan is open to everybody, regardless of
whether you are a Sharekhan customer.

To invest in a fund, all you have to do is download the application form, print it out, fill it
in and send it over to share-khan. They’ll do the rest for you.

 Convenient, Secure and Automated Demat services

Dematerialization and trading in the demat mode is the safer and faster alternative to the
physical existence of securities. Demat as a parallel solution offers freedom from delays,
thefts, forgeries, settlement risks and paper work. This system works through depository
participants (DPs) who offer demat services and the securities are held in the electronic
form for the investor directly by the Depository.

Sharekhan Depository Services offers dematerialization services to individual and

corporate investors. They have a team of professionals and the latest technological
expertise dedicated exclusively to their demat department, apart from a national network
of franchisee, making our services quick, convenient and efficient.

At Sharekhan, our commitment is to provide a complete demat solution which is simple,

safe and secure.

CLASSIC ACCOUNT

This is a User Friendly Product which allows the client to trade through website
www.sharekhan.com and is suitable for the retail investor who is risk-averse and hence
prefers to invest in stocks or who do not trade too frequently.

Features

 Online trading account for investing in Equity and Derivatives via

www.sharekhan.com

 Live Terminal and Single terminal for NSE Cash, NSE F&O & BSE.

41
 Integration of On-line trading, Saving Bank and Demat Account.

 Instant cash transfer facility against purchase & sale of shares.

 Competitive transaction charges.

 Instant order and trade confirmation by E-mail.

 Streaming Quotes (Cash & Derivatives).

 Personalized market watch.

 Single screen interface for Cash and derivatives and more.

 Provision to enter price trigger and view the same online in market watch.

SPEED-TRADE

SPEED-TRADE is an internet-based software application that enables you to buy and sell
in an instant.

It is ideal for active traders and jobbers who transact frequently during day’s session to
capitalize on intra-day price movement.

Features

 Instant order Execution and Confirmation.

 Single screen trading terminal for NSE Cash, NSE F&O & BSE.

 Technical Studies.

 Multiple Charting.

 Real-time streaming quotes, tic-by-tic charts.

 Market summary (Cost traded scrip, highest value etc.)

 Hot keys similar to breakers terminal.

 Alerts and reminders.

 Back-up facility to place trades on Direct Phone lines.

42
DIAL-N-TRADE

Along with enabling access for your trade online, the CLASSIC and SPEEDTRADE
ACCOUNT also gives you our Dial-n trade services. With this service, all you have to do
is dial our dedicated phone lines 1-800-22-7500, 3970-7500.

PORTFOLIO MANAGEMENT SERVICES

1. Prop rime: - Research & Fundamental Analysis.

2. Protect: - Technical Analysis.

-Thrifty Nifty

-Beta Portfolio

3. ProArbitrage: - Exploit price analysis

IPO ON-LINE

You can apply all the forthcoming IPO online hasselfree, paperless and time saving work.

43
CHARGE STRUCTURE

Structure for Pre Paid – Account Individuals: -

Charge Classic Account Speed Trade Account

Account Opening Rs. 750/= Rs. 1000/=

Monthly Rs. NIL Rs. 500/=

Commitment

Brokerage Intra-day – 0.07 %** Intra-day - 0.05%**

Delivery - 0.40 %** Delivery - 0.25%**

* Refundable in case the brokerage is more than Rs. 500/= p.m.

** Condition Apply.

*** Taxes as per govt.

Structure for Post Paid – Account Individuals: -

Charge Classic Account Speed Trade Account

Account Opening Rs. 750/- Rs. 1000/-

Monthly Rs. NIL Rs. 500/-

Commitment

Brokerage Intra-day - 0.10 %* Intra-day - 0.10 %*

Delivery - 0. 50 %* Delivery - 0.50 %*

44
* Refundable in case the brokerage is more than Rs. 500/= p.m.

** Taxes as per govt.

They offer an On-line Trading Account along with the Demat A/c for the benefits to the
employees of company.

Depository Charges

Account Opening Charges Rs. NIL

Annual Maintenance Charges Rs. NIL first year Rs. 300/= p.a. from
second calendar year onward

PRODUCT DETAILS

(A) CLASSIC ACCOUNT: A/C Opening charges: Rs. 750/-

DEMAT A/C free for first year and Rs.300 from 2nd year onwards (Annual Maintenance
charges). Trading through website live terminal. No brokerage commitment required.NSE
and BS online. Both Cash & F&O.

(B) SPEED TRADE: Account Opening Fee: Rs. 1,000/-.Both Cash & F&O.

Monthly Recurring Fee: Rs 500/- per month, which is very nominal if you consider the
benefits of the product. This access charges will be debited to all the new customers signed
up after Sept 15, 2004. And at the end of the month if the client has contributed more than
Rs. 500/- as brokerage the access charges of Rs. 500/- will be credited back to the clients

45
account. Please note - this credit of Rs. 500/- will be given only to customers who have
contributed more than Rs. 500/- as brokerage during the months.

Minimum Brokerage Intra Day Per Share:

5 Paisa each leg (buy or sell) for Intra-day Trades (For e.g. on a Rs 20 Scrip, brokerage @
0.10% = 2 paisa, but there is a min. chargeable amount of 5 paisa).

Minimum Delivery Handling Charges:

10 Paisa for Delivery Trades (buy and sell) (For e.g. on a Rs 10 Scrip, brokerage @ 0.50%
= 5 paisa, but there is a min. chargeable amount of 10 paisa).

Rs 16/- per Scrip (The brokerage per Scrip will be charged for the selling of shares resulting
in delivery on actual). (For e.g. if a customer sells 100 shares of SAIL, TOTAL Delivery
value = 2200, brokerage @ 0.5% = Rs 11, but the min chargeable amt per scrip per day =
Rs 16), so additional Rs 5/- will be charged as Min delivery handling charges).

EXPOSURE: 4 TO 6.7 TIMES (ON MARGINE MONEY)

Online IPO's available

They have tie up with Nine banks for online fund transferring i.e. HDFC, ICICI, IDBI,
CITI, Union Bank of India, Oriental Bank of Commerce, INDUSIND, UTI bank ,
Bank of India and Yes Bank for online money transfer.

46
 CHAPTER-3
DATA ANALYSIS &
INTERPRETATION

47
ANALYSIS OF FUTURE ONLINE TRADING
(1) Are people aware of stock market?

(a)Yes (b) No

29%
NO
71%
YES

People aware of stock

market No of respondent
NO 29
YES 71

Interpretation: - A survey was conducted on the 200 people in the market. 71% of the
respondent replies that they know about the stock market other than those 29% belongs not
know about that category.

48
(2)Through which sources people are aware?

(a)News paper (b) Friends (c) T.V (d) other sources

5% Newspaper/Magazine

36%
Friends/Colleagues
47%
TV

Other sources
12%

Sources No of respondent
Newspaper/Magazine 36
Friends/Colleagues 12
TV 47
Other sources 5

Interpretation:- The resources of the spreading awareness into the respondent as per
their percentage i.e. TV- 47% is the first above all, NEWSPAPER/ MAGZINES- 36%,
FRIENDS- 12%, OTHER SOURCES- 5%.

49
(3) Which brand gives the more customer value?

(a) ICICIDIRECT
(b) INDIA BULLS
(c) SHAREKHAN
(d) RELIGARE

60

50
45

36
Series1

ICICI DIRECT INDIA BULLS SHAREKHAN Ltd. RELIGARE

ICICI INDIA SHAREKHAN

Brands DIRECT BULLS Ltd. RELIGARE OTHER
No of
respondent 50 36 60 45 9

Interpretation:- SHARE-KHAN- 60 is the rank Ist among the other brands that is
ICICI direct-50, RELIGARE – 45 and the INDIA BULLS-36 is the last in the tally.

50
(4) AT WHAT PRICE PEOPLE WANT TO OPEN THEIR ACCOUNT?
(a) Rs 750
(b) Rs 900
(c) Rs 999
(d) Rs 750

1200
999
1000 900

800 750 750

600 Series1

400

200

ICICI INDIA RELIGARE

Brands DIRECT BULLS SECURITIES SHAREKHAN LTD.

No of respondent 750 900 999 750

Interpretation: - SHARE KHAN & ICICI direct are the two broking house which are
charging Rs-750 as opening of demat account. INDIA-BULLS is charging Rs-900, and the
RELIGARE securities is charging Rs-999 which is the highest charges among the all.

51
Analysis Pattern

Analysis can be defined as get some information from collected date i.e. get information
from raw data. Collected data is of no use until some results have not been found out. And
analysis serves this purpose. Analysis can be done in many ways like graphs, charts, tables,
coding and statistical analysis etc.
The data thus collected was edited, tabulated, analyzed and interpreted to make study
meaningful.

Fig-1
Question-1
Interpretation: This shows that although the mutual funds market is on the rise yet, the
most favored investment continues to be in the banks. So, with a more transparent system,
investment in the mutual funds can definitely be increased.

52
 Question-2

TIME HORIZON FOR INVESTMENT

0.45
39%
0.4 37%
0.35
0.3
24%
0.25
0.2
0.15
0.1
0.05
0
less than 2 years 2-5 years more than 5
years

Fig.2

Interpretation: This graph shows that the maximum time horizon for investment in less
than 2 years is 39%. Most of the people invest their money for less than 2 years. People
do not wait till more than 2 years.

53
 Question-3

IDEAL RATE OF RETURN AGAINST ANY

INVESTMENT

12%
25%

15% UPTO 8%
8%-15%
15%-18%
MORE THAN 18%

48%

Fig.3

Interpretation: This shows that out of 200 respondent 48% of respondent want 8%-15%
rate of return. Most of people expected 8%-15% rate of return.

54
 Question-4

FACTOR THAT AFFECTED INVESTMENT

DECISION

60% 55%

50%
40%
30% 22%
20% 13%
10%
10%
0%
rate of return security liquidity tax benefit

Series1 Series2

Fig.4

Interpretation: In this graph shows that most of the people consider rate of return factor
while investing their money. Some people invest their money for tax benefit also.

55
 Question-5

PORTFOLIO SIZE OF INVESTMENT

40%
35%
30%
25%
20%
15%
10%
5%
0%
upto 500000- 200000- 500000- above
50000 200000 500000 800000 800000

Series1 Series2

Fig.5

Interpretation: This shows that 40% of respondent out of 200 investment up to 50000rs.
Only 6% respondent invests above 800000rs.

56
 Question-6

rate of various investment alternative

0.4 38%

0.35
0.3
0.25 23% 22%
Series1
0.2 17%
Series2
0.15
0.1
0.05
0
mutual equity banks others
funds

Fig.6

Mutual funds 1 2 3 4

Banks 1 2 3 4

Equity 1 2 3 4

Other 1 2 3 4

Interpretation: This graph shows that different investor rate according to their preference.
38% of people give 1st rank to banks then 23% of people choose mutual funds then after
22% of people prefer others and 17% of people prefer equity.

57
 CHAPTER-4
SUMMARY AND CONCLUSION

58
Results of the Study

1. 17% people invest in equity and rest of percentage people used other investment
alternative.

2. 23% people invest mutual funds, 38% people invest in banks and 22% of people
invest in other like gold, bond, post office NSC etc.

3. 48% of people want 8%-15% rate of return against their investment.

4. 55% of people consider rate of return factor while investing their money.

5. 40% of people invest up to 50000.

59
LIMITATIONS

 This project is limited in scope as the survey is conducted with a shortage of time
constraint and is also based on secondary data.

 The answers given by the respondents may be biased due to several reasons or could
be attachment to a particular company.

 Due to ignorance factor some of the respondents were not able to give correct
answers.

 The respondents were not disclosing their exact portfolio because they have a fear
in their minds that they can come under tax slabs.

60
SUGGESTIONS AND RECOMMENDATIONS

I suggest following measures: -

 While interacting with the investors I found that most of the customers are unaware
about the Mutual fund. Some of the people look upon mutual funds and equity
trading as gambling. Thus a mutual fund awareness program can help to increase
the penetration of mutual funds in the market.

 The Stock Market has been very buoyant until now especially in the past 3 years.
This particular trend is very favorable because a soaring SENSEX means higher
returns, which encourages the investors to invest their money in the market.
Although in the past 3 months the market has shown very unpredictable trend and
has already lost over 1000 points.

 In case of insurance, it requires push selling because people always associate it with
emergencies and unpleasant situations like death and they don’t want to think about
such situation let alone prepare for them, which means it requires a lot of conviction
on part of the executives.

 People have just opened up to the idea of ULIPs because till now they knew only
two kinds of insurance plans, endowment and term plans so the concept of high
returns with protection is very new to them and slowly and slowly these are
becoming popular so there is a huge market waiting to be tapped

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 BIBLIOGRAPHY

Books:
 Agarwal, J.D. "Security Analysis & Portfolio Management: A Review, Finance
India, Vol. II No. 1, March 1989.
 Bhatt, V. V. "An Appraisal Of Some Recent Estimates Of Savings and
Investments", ICRNI, Vol. 5, 1963.
 Douglas A. Hayes and W. Scott Bauman "Investments: Analysis and Management"
III Ed., 1976, MacMillan
 Malhotra, Naresh "Marketing Research and Applied Orientation" IV Ed., 2005,
Pearson

Internet:
 www.mutualfundsindia.com
 www.easymf.com
 www.amfiindia.com
 www.moneycontrol.com
 www.valueresearchonline.com
 www.nseindia.com
 www.bseindia.com

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 APPENDIX

Q1.What is the age group you fall in?

(a)17-30 (b)30-40 (c)40-50 (d)50-60 (e)above 60

Q2. Are people aware of stock market?

(a)Yes (b) No

Q3. If yes, in which company you are dealing with?

(a)SHAREKHAN Ltd.

(b) INDIA BULLS

(c) ICICI DIRECT

(d)RELIGARE SECURITIES

(e)ANY OTHER

Q4. Through which sources people are aware?

(a)News paper (b) Friends (c) T.V (d) other sources

Q5. Where do you invest your money?

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 Equity mutual fund Banks others

(Others – Gold, Bonds, Post office, NSC)

Q6. What is your time horizon for investment?

Less than 2 years 2-5 years more than 5 years

Q7. Which factor you consider more while investing your money?

Rate of return Risk factor Liquidity

Tax benefit

Q8. What according to you is ideal rate of return against any investment?

Up to 3% 3-8% 8-15% 15-18% more than 18

Q9. What would be your portfolio size of investment ?

Up to 50000 50000 to 200000 200000 to 500000 Above 50%

500000 to 800000 above 800000

Q10. Please rates investment alternative according to your preference?

Mutual fund
1 2 3 4

Equity 1 2 3 4

1 2 3 4

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 Banks

1 2 3 4
Others

Q11. Who influence you in your investment decision?

Friends Family members C.A Colleges others

Q12. Any suggestions you want to provide?

Personal Information

Name:…………………………………………………….

Age…………………………………………………….…

Sex…………Male…………..Female……………………

Phone No…………………………………………………

Occupation:………………………………………………

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