AT

Prabhudas Lilladher
Submitted in partial fulfillment of the requirements of the two year
Post Graduate Programme (PGP)

Submitted by
Manoj Kumar Dash
……………………………………………………………………………….
Roll No: PG20090161
Batch: 2009-2011

IILM Institute for Higher Education, Lodhi Road

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 A REPORT

ON

“GROWTH OF INDIAN ONLINE TRADING INDUSTRY”

_____________________________________________________________
A report submitted in partial fulfillment of the requirements of PGDM program of
IILM Institute for Higher Education, New Delhi
SUBMITTED TO:

Mr. Sandeep Sharma

Sales Manager
Prabhudas Lilladher, North Region
MOBILE:-+918800439431
&
Mr. Sandeep Kapoor
Asst. Professor
IILM Institute
MOBILE -+919891375383

ACKNOWLEDGEMENT

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 The beatitude, bliss and euphoria that accompany the successful completion of any task
would not be complete without the expression of appreciation of simple virtues to the people
who made it possible.

The final project report is submitted to institute of technology and science, Ghaziabad for
partial fulfillment of diploma, post graduate diploma in management (PGDM).

This project is an attempt to study “future and growth of online trading in India
At IL&FS INVESTSMART SECURITIES LTD.(HSBC Group).
I would like to thanks to the Management of IL&FS INVESTSMART SECURITIES
LTD. (HSBC Group) for giving me the opportunity to do my two-month project training in
their esteemed organization. I am highly obliged to Mr. RAHUL KUMAR AGARWAL
(AREA SALES MANAGER) for granting me to undertake my training at RDC RAJ NAGAR
branch.
I express my thanks to all Sales Managers and other relationship managers under whose
guidance and direction, I gave a good shape to my training. Their constant review and
excellent suggestions throughout the project are highly commendable. My heartfelt thanks
go to all the executives who helped me to gain knowledge about the actual working and the
processes involved in various departments. I would also like to sincerely thank my faculty
guide Dr. KAVITA SRIVASTAVA whose guidance has helped me to Understand and
complete my project in a timely and proper manner

ANKUL MAHESHWARI

DECLARATION

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I do hereby declare that the project report is submitted as partial fulfillment of the
requirement of PGDM Program of INSTITUTE OF TECHNOLOGY AND SCIENCE,
GHAZIABAD

The Project has been done under the guidance of Mr. RAHUL KUMAR AGARAWAL,
KUMER SINGH NEGI and GAURAV KUMAR in Raj nagar branch, Ghaziabad and Dr.
KAVITA SRIVASTAVA Faculty guide, INSTITUTE OF TECHNOLOGY AND
SCIENCE, Ghaziabad
No part of this report has not been published or submitted elsewhere for the fulfillment of
any degree or diploma for any institute or university.

ANKUL MAHESHWARI

CONTENTS

PAGE NO.

EXECUTIVE SUMMARY……………………………………..………………..……6

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PROJECT DETAIL………………………………………………………………..…..7
Project title……………………………………………………..............………7
Justification of the title…………………………………………...…………….7
Scope of the study……………………………………………………..……….7
Research objective…………………………………………………………..….8
Research methodology………………………………………………………... 8
Research design……………………………………………………..………….9.
Sampling methodology……………………………………………..………….10.
Limitations of the study…………………………………………………….... 10
COMPANY PROFILE……………………………………………………................. 11
LITERATURE REVIEW………………………………………………...……………34
ONLINE TRADING……………………………………………….………………….38
THE EMERGENCE OF ONLINE TRADING IN INDIA……………………………42
ICICIdirect ……………………………………………….……………………44
Reliance money ………………………………………….…………………….46
Share khan ……………………………………………….…………………….48
Kotak securities ………………………………………….…………………….51
Indiabulls …………………………………………………..…………………..54
Motilal Oswal ……………………………………………….…………………55
Religare ………………………………………………………………………..57
IndiaInfoline …………………………………………………………………..58
GROWTH OF ONLINE TRADING ………………………………………………....62
ANALYSIS PART ………………………………………………….…………………67
CONCLUSION ………………………………………………………….…………….79
RECOMMENDATIONS ……………….……………………………….………….....80
INDUSTRY RELEVANCE ……………………………………………………….…..81
LEARNING ……………………………………………………………………………82
BIBLIOGRAPHY ………………………………………………………..…………….83

1. EXECUTIVE SUMMARY

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 As per the title suggest the project report has been prepared regarding the growth and
development of online trading in India. Online trading was initiated by NSE in India and soon after
the other exchanges also followed it.
There was a major boom in yr. 2000 when lots of online trading companies came with a bang
but only few were survived because of lack of computer knowledge and low internet penetration.
There are two types of online trading companies one is the banking online trading companies and
the other is non-banking trading. A few examples of banking online trading companies are HDFC
securities, ICICI direct.com, UTI securities etc.
On the other hand non -banking trading companies are IL&FS investsmart, Religare securities
Angel Broking, Reliance Money etc. A study was undertaken to determine the growth of various
online trading companies in India in terms of trade done by them through online and services

provided by them .
Major findings indicates that out of a survey of 100 respondents it was seen that most of the
investors prefer online trading because of few major factors such as time saving convenience,
protection through Freudian brokers etc. although during my research project I’ve seen that most of
the respondents feel online trading, a secure way of investing into stock market still a few of them
feel that it’s unsafe and a bit complicated but they posses information about online trading.
Today the online trading companies having cut-throat competition in our offering whose brokerage
discounts lower margin money and zero balance accounts. Due to the rising education awareness
and use of internet there is a huge potential for online trading in future and companies must come

up with innovative offerings to capture the untapped market.

2. PROJECT DETAIL

PROJECT TITLE:

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 To determine the “GROWTH OF INDIAN ONLINE TRADING INDUSTRY”

TITLE JUSTIFICATION:

The above title is self explanatory. This study mainly deals with growth and development of
online trading in India since its inception in the year 2000. Due to subprime mortgage crisis in year
2008 NASDAQ and S&P 500, two major stock exchange of the world entered into the bearish
market. it also affected the stock market all over the world including India. It is the challenge for the
growth and development of trading in India that’s why I choose that particular topic for the study.

SCOPE OF THE STUDY

Since the year 2000 a big boom has been witnessed in the Indian Stock Market when the
market showed the coming up of Online Trading System. Many online stock trading companies
came but initially due to lack of online trading some companies vanished and some survived. The
companies which survived are getting the handsome returns also attracting the foreign Investment
Companies. Nowadays this sector is facing cut-throat competition and also provides huge growth
prospects. The study then goes to evaluate and analyze the findings so as to present a clear picture
of the trends in the online trading sector.

RESEARCH OBJECTIVES

The objectives of my research project is –

1. To determine the growth and future of online trading industry in India

2. To understand the customer perception of online trading.
3. To see the type of technology used by stock exchanges and by the Indian customer in online
trading
4. To determine what type of products the customers deal while doing the online trading.

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5. To understand the presence of major online traders in the Indian market and looking about
the features provided by them
6. To find out the important factor which do mostly affect to the customer
7. To develop a good strategy and process that improves the business of the organization
8. To be able to compare and analyze the various Financial Products.
9. Business development and revenue generation.

RESEARCH METHODOLOGY

The research methodology for the project completed in two phases:

First Phase is the collection of Secondary Data:

This involves the collection of Secondary data using internet and internal sources for
comparison of Online trading account of other Broking houses in the market like
PRABHUDAS,ICICI Direct, MOTILAL Oswal, Religare and Reliance Money etc. This also
involves talking to their executives regarding various features provided to the customer along with
their Brokerage structure.

Second Phase is Collection of Primary Data and Analysis:

After collecting the Secondary data the next phase will be collection of primary data using
Questionnaires. The questionnaire will be filled by around 53 people who will be mainly from
Delhi/NCR region. The sample will consist of people who are employed or work as free lancers
dealing in investment options to know their financial requirements. Based on these requirements
different investments will be informed to them for further perusal. The data collected will be then
entered into SPSS (software) and MS-excel for analysis of the data collected

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RESEARCH DESIGN

Non probability
The non –probability respondents have been researched by selecting the persons who do the stock
trading. Those persons who do not trade in stocks have not been interviewed.

Exploratory and descriptive research

The research is primarily both exploratory and descriptive in nature. The sources of information are
both primary and secondary. The secondary data has been taken by referring to various magazines,
newspapers, internal sources and internet to get the figures required for the research purposes. The
objective of the exploratory research is to gain insights and ideas. The objective of the descriptive
research study is typically concerned with determining the frequency with which something occurs.
A well structured questionnaire was prepared for the primary research and personal interviews were
conducted to collect the responses of the target population.

SAMPLING METHODOLOGY

Sampling Technique
Initially, a rough draft was prepared a pilot study was done to check the accuracy of the
Questionnaire and certain changes were done to prepare the final questionnaire to make it more
judgmental.

Sampling Unit
The respondents who were asked to fill out the questionnaire in the National Capital Region are the
sampling units. These respondents comprise of the persons dealing in stock trading. The people

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have been interviewed in the open market, in front of the companies, telephonic interviews and
through other sources also

Sample Size
The sample size was restricted to only 53 respondents.

Sampling Area
The area of the research was National Capital Region (NCR).

LIMITATION OF THE STUDY

The various limitations of the study are:

 People were not willing to fill the entire questionnaire due to the less time available to them
 Some respondents might be hesitant to divulge personal and financial information which can
affect the validity of all responses
 There is lack of awareness among people about investing in stock market. So the people
who are aware of such things were found in specific areas for survey purposes.
 Most people are comfortable with traditional system in small towns and like to trade from
their respective brokers, hence not providing a true opinion of theirs.

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 Some of the respondents who did not do online trading were able to respond to only few
questions.
 The survey was done in the NCR region and may not truly express the opinion of whole
country

3. COMPANY PROFILE

Prabhudas Lilladher is one of the India’s leading financial service houses, was established as
a brokerage house in 1944 by Mr. Prabhudas Lilladher Sheth. It provides a complete range
of financial services in the Institutional and Retail domain. It has nationwide distribution
network through branches, franchisees and associates. It has Strong adherence to founding
principles of integrity, transparency and accountability.

Vision
To be a leading financial services house providing maximum value addition by offering
innovative products and services
Approach

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Prabhudas Lilladher is committed to provide excellent customer service while maintaining
the highest levels of ethical and professional conduct. At PL, integrity, transparency and
accountability form the founding principles, to which Prabhudas Lilladher strictly adheres.
Prabhudas Lilladher adopts a service-centric approach, providing customised and practical
solutions that are most pertinent for their clients’ businesses. Prabhudas Lilladher works in
close association with each individual client to provide outstanding financial insights, while
maintaining complete transparency throughout the process.
Work culture
Over the years PL has nurtured and advocated excellence as their attitude; Company
believes in delivering the best constantly and consistently.
Experience has proved that effective communication is the key to success. Therefore the
open door policy at PL is another defining aspect of their Organizational Culture.
PL puts our employees on the fast track and throws open challenges, encouraging
excellence. Moreover PL strongly believes in acknowledgement as a strong motivational
tool, thus performers are duly rewarded. Company always looks out for ideas, creativity and
innovation.

Group Companies

Prabhudas Lilladher Advisory Services Private Limited

Prabhudas Lilladher Advisory Services Private Limited is the group holding company.
Besides providing financial advisory services to the Corporates, the Company helps its
clients to raise resources from domestic & global investors through various instruments.
Prabhudas Lilladher Private Limited
Prabhudas Lilladher Private Limited is the stock-broking arm of the PL Group. A member of
the National Stock Exchange and The Stock Exchange, Mumbai, PLPL provides equity
trading facilities and related products and services on these premier exchanges. PLPL also
known as Majorgainz offers these services through all branches, Progress Partner locations
and the internet (www.majorgainz.com).

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Prabhudas Lilladher Financial Services Private Limited
Prabhudas Lilladher Financial Services Private Limited is the non banking financial services
(NBFC) arm of PL group. An RBI-approved NBFC, PLFS offers Loans and Margin
Funding against approved securities to meet the fund requirements various borrowers.
PL Capital Markets Private Limited
PL Capital Markets Private Limited offers capital raising and other investment banking
services including the management of public offerings, private placements (including
qualified institutional placements), rights issues, share buybacks, open offers/delistings,
Valuation services, mergers & Acquisitions etc.
PL Fund Advisors Private Limited
PL Fund Advisors Private Limited offers Wealth management services across the entire
spectrum right from equities to Mutual Funds, Private equity, Insurance, Real Estate, Art
Funds among others.
PL Distribution Company Private Limited
Distribution of Financial Products including Mutual Funds and IPOs is offered by PL
Distribution Company Pvt. Ltd. With a reach across cities in India, we service the needs of
investors pan-India.

Prabhudas Lilladher Pvt. Ltd. (MajorGaniz)

Prabhudas Lilladher Pvt. Ltd. provides equity research and brokerage services for the
institutional and retail clients. The company offers a range of investment products and
services, which include offline and online equity execution systems; trading in derivatives
that include hedging and index arbitrage; online trading; portfolio management services;
portfolio advisory services; and initial public offer services. It also provides depository
services, such as account opening facilities, dematerialization of physical shares, re-
materialization, pledging, and settlements; mutual funds; reports on select companies by
research analysts, daily market reports, and economy overviews.

Founded 1944

Headquarters Worli , Mumbai

Company Type Private Limted

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 Industry Financial Services

No. of employees 400

Status Operating

Amisha Bora (Group Joint Managing Director)

Dilip Bhat (Group Joint Managing direct)
Key people Mihir Sheth (Group Executive Director)
Rakesh Bharuch (Group CFO)
Subrahmanian Analakkatt (President Operational Settlement )

Ranked 8th Best Indian Broking House by Asia Money 2007

Achievements Rated 3rd in generating small cap ideas by Asia Money 2007

Associated Banks ICICI and HDFC Banks

SRG Investment Consultants

Sub Brokers Mulki Investments & Financial Consultants (Pvt) Ltd.
Parekh Shares & Securities

Website http://www.plindia.com

Network
Name of No. of State Name of the No. of State
the City Branc City Branc
h h
office office
s s
Ahemdaba 1 Gujrat Mumbai (Head
3 Maharashtra
d office)
Bharuch 2 Gujrat Nadiad 1 Gujrat
Chennai 1 Tamilnad
Nagpur 1 Maharashtra
u
Durgapur 1 West
New Delhi 3 UT
bengal
jaipur 1 Rajisithan Madhya
Satana 1
Pradesh
Kannur 1 Kerela Surat 1 Gujrat
Kocchi 1 Kerela Thiruvananthapur
1 Kerela
am
Kolkata 1 West Vadodara 1 Gujrat

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 bengal
Vashi 1 Maharashtra

Management and Sales Organization Structure

Prabhudas Liiladher Pvt. Ltd. Follows territory design organization structure when it comes
to sales organization structure where every salesperson is assigned a specific area for sales
responsibilities
Advantages:
 Limits travel time and cost

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  Better customer service – more personal involvement

 Limited conflict of responsibilities and rewards

 Possible to develop and execute territory specific marketing/promotional strategy

Disadvantages
 No product specialization

 No customer specialization

 Duplication of sales effort/staffing requirements

Management Trainees work under supervision of Relation manager / Relation executive.

They accomplish task given by relation manager/executive. Check Sometimes Sales
Manager takes class room training and over check the performance of trainees once in a
week.

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 Products

Product Types:-
A) Power+

B) Power1

C) Power3

D) Power6

E) Turbo12

F) Turbo30

G) Turbo60

H) Turbo120

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 PYOBS Scheme:-

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Common Features PYOBS Scheme
Turbo120 Turbo60 Turbo30 Turbo12 Power6 Power3 Power1 Power+
AO charges (Rs.) 300
Demat AMC P.A. Free As per the scheme selected
(Rs.)
Exe App Access As per Table 1 in case of Exe Application
Default App Access Exe based application Web applet based application
Trading Platform Odin/RTGSL/NOW(Only NSE) Odin/RTGSL/NOW(Only NSE)
(Cash & Derv.)
Trading Platform NSE NOW NSE NOW
(Currency Derv.)
Brokerage on 0.10% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40%
Delivery (Rs.)
Cash Intraday &
Future Trades (Rs.) 0.005% 0.01% 0.015% 0.02% 0.025% 0.03% 0.035% 0.04%
Min Paisa per Scrip 0.5p 1p 1.5p 2p 2.5p 3p 4p 5p
Options 20 30 40 50 Higher of 2.5% of premium or Rs. 75/-
(Rs. per Lot)
Initial Margin Optional Optional 5000
Amount (Rs.)
Validity Period 12 Months 12 Months 6 Months Lifetime
Free Call N Trade 30 Calls 20 Calls
calls
Charges for Call N Rs 5/- from 31st Call Rs 5/- from 21st Call
Trade
Adjustable Option
Cost of
Subscription(Rs.)A 120,000 60,000 30,000 12,000 6,000 3,000 1,000 NA
djustable
# Newsletters & Till Scheme period 2 Quarters 1 Quarters 1 Months Table2
SMS Calls (Free)
Scheme Extension
(only if renewed) 1 Quarter
Only if adjustable
amount is more than 75% 80% 85% 90%
Installment Option Quarterly Half Yearly
(ECS)
Reduction in Option
Brokerage per lot Rs. 15,000 for every Rs 5 reduction
(Min Rs 10 per lot)
Early Exit cost (5%
of Scheme Value) 6,000 3,000 1,500 600
Non Adjustable
Option
Cost of
Subscription(Rs.) 3,000 15,000 7,500 3,000 NA
Non Adjustable
# Newsletters & Till Scheme Period 2 Quarter 1Quarter
SMS Calls(Free)
Reduction in Option Rs. 4,00 for every Rs 5 reduction
per lot (Min Rs. 10 per lot)
Discount on Brokerage Generated/Cost
Scheme Extension (Rounded off to Nearest Integer)
(%) = 20 Times of

ECS (Electronic Clearing System)

Table-1

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 Exe App Charge (Rs.)
If Monthly Brokerage Generated (Rs.) Monthly
Is Less than 100 750
Is Less than 1,000 500
Is Less than 2,000 250
Is >= 2,000 Free

Table-2
Newsletter & SMS charges (Rs.)
Period Newsletters SMS Combo
MS WG
Monthly 400 300 100 600
Quarterly 1,000 750 250 1,500
Yearly 3,600 2,700 900 5,400

Power - 20 Calls Free

• If software taken then charges – 750/-

• Lifetime AMC(Annual Maintenance Charges) – 600/-

• Demat a/c opening Charges – 300/-

Power+ = 300+600+5,000(Advanced Margin)

Power1 = 300+600+1000(Advanced Brokerage, 6M)
Power3 = 300+600+3000(Advanced Brokerage, 12M)
Power6 = 300+600+6000(Advanced Brokerage, 12M)

Turbo - 30 Calls Free

Turbo12 = 12,000(Advanced Brokerage, Adjustable, 12M)
Turbo30 = 30,000(Advanced Brokerage, Adjustable, 12M)
Turbo60 = 60,000(Advanced Brokerage, Adjustable, 12M)
Turbo120 = 120,000(Advanced Brokerage, Adjustable, 12M)

Opening of Depository account:-

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 1. What are the types of Depository accounts with PL?
2. What is the process for Dematerialisation of Securities with PL ?
3. What are the different transactions I can conduct from my BO(beneficiary
ownership) account with PL?
4. What will the Account Statements comprise of ?
5. How to read the holding statement?

Top1. What are the types of Depository accounts with PL?

You can open two types of depository accounts:

INDIVIDUAL ACCOUNT
While opening an Individual Account you will require the following documents:

 Completed Account opening form, signed by all applicants (to be collected from us)
 One set of photographs of all applicants with their signatures across the face of the
photograph
 Execute agreement on a Rs.20/- non judicial stamp paper (to be collected from us)
 Proof of Identity – copies of any one of the following documents for all applicants
 Ration Card
 Passport
 Driving License
 Voters ID Card
 PAN Card (supplementary proof for address required as PAN card does not
mention the cardholder’s address)
 First page of bank pass-book attested by the bank manager
 Letter from the bank on their letterhead confirming the bonafide and address
of the accountholder.

CORPORATE ACCOUNT
While opening an Corporate Account you will require the following documents:

 Completed Account opening form (to be collected from us)

 One set of photographs of all authorized Signatories with their signatures across the
face of the photograph.
 Execute agreement on a Rs.20/- non judicial stamp paper (to be collected from us)
 Certified True copies of the Memorandum and Articles of Association.
 Certified true copy of Board Resolution for person/s authorized by the Board to act
as authorized Signatory/s to be given on the company’s letterhead
 Names of the authorized Signatories, Designation and their Specimen signatures on
the company’s letterhead.
 POA if any given to the authorized Signatories.

Top 2. What is the process for dematerialization of Securities with PL?

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 For dematerialization of your securities (i.e. converting physical shares into Demat form)
you will need to follow this process:

 Submit your application for dematerialization on a Demat Request Form (DRF)

 Submit certificates along with the DRF.

We will then

 Verify the order of names in the certificates and BO account

 Verify the signatures of all holders
 Process your Demat request and forward the same to the Registrar/Issuers

The Registrars/Issuers will process the request and on confirmation by them, the Depository
will credit your BO account, which will be reflected as Free Balance in your account.
Top 3. What are the different transactions I can conduct from my BO (beneficiary
ownership) account with PL?
You can conduct following transactions from your BO account

DEBIT TRANSACTIONS
You can transfer securities through a debit transaction from your BO account to

a. Clearing House account for fulfilling your sale obligation (On-Market Transaction)
b. Any BO account at CDSL (Off-Market Transaction)
c. Any BO account at NSDL (Inter-Depository Transaction)

For this, you will have to give us instruction from the personalized Instruction slip-book
issued to you at the time of opening of your BO account. This slip will have to be signed by
all the holders in the same manner as recorded with us.

CREDIT TRANSACTIONS
You can receive securities through a credit transaction from any BO (beneficiary ownership)
account to your account. It would be convenient for you and for us if you opt for a waiver
from confirmation for credits (in other words standing instructions to receive all credits) at
the time of opening of your BO account. You will not be required to give a receipt
instruction to us whenever you are to receive a credit in your account.

4. LITERATURE REVIEW

ONLINE TRADING INFRASTRUCTURE

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 The emergence of online exchanges has facilitated faster transactions by providing online
trading portals and brokerage houses ease and flexibility. The Internet has indeed opened up new
opportunities for conducting the business. The worldwide stock exchanges has made a major shift
from the traditional method of trading and now conduct a bulk of its business online through its
brokers and partners.
In the developed countries majorly all the exchange transactions are conducted online. The
trend took off slowly in India and the National Stock Exchange (NSE) and the Bombay Stock
Exchange (BSE) two of the largest exchanges in India have been conducting online trade
successfully for some time.

WHY ONLINE TRADING ENTERED LATE IN INDIA?

The Indian exchanges and brokering houses have been very slow in moving their
transactions online and the major reason has been the lot government regulations. The initial delay
was due to laying down the specifications for creating Closed User Groups (CUGs). This issue was
resolved between the Department of Telecommunications (DoT) and the Finance Ministry around
1998 and after that soon came the online trading portals like IL&FS investsmart, ICICIDirect.com,
motilaloswal.com, sharekhan.com etc. Connectivity related issue was perhaps the most important
technological factor.RBI made regulation that it is mandatory for company to store at least 7 year
financial and transactional data.

In the non-stop, 24 hours a day, seven days a week world of investing, we are able to

 Obtain investment news around the clock

 Check quotes on exchanges all over the world – day or night
 Easily compare one investment to another via numerous ratios, charts,
graphs, and tables
 Screen for the best investments to fit our individual goals and requirements
 Trade stocks as easily and quickly as professional traders
 Calculate retirement needs based on various scenarios

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  Regularly monitor portfolios and make necessary changes quickly and almost
effortlessly
 Control the routing of individual trades for the best possible price and
execution
 Even many years after the launch of the first online brokerage firm, there
remain a large contingent of individual investors who still pick up the phone
and call their stock broker to buy and sell investments. However, every year a
growing number of investors are placing their trades using online brokers.

INDIAN EXCHANGES: NSE and BSE

The NSE and BSE are among the largest exchanges in the country handling very large daily
trading volumes, support large amounts of data traffic, and have a very large nationwide network.
The trading volume in year 2000 was huge with the average daily turnover in the capital markets
segment at NSE is around Rs 2300 crore and in the derivatives segment, around Rs 1300 crore.
The average daily traffic volume was around one million trades per day in the capital markets
segment and around 50,000 trades per day in the derivatives segment and there were around
13,000 registered users in both segments and an average of around 9500 users is logged in at a
time. At BSE the average daily turnover in 2001-2002 (April-March) was Rs 1244.10 crore and the
number of average daily trades was Rs 5.17 lakh.

THE NETWORK DESIGN

Any online exchange should always be-on, safe, secure, redundant and should have adequate
backup & recovery processes. The Vice President of NSE-IT G.M Shenoy tells that the basic design
objective of NSE was to provide fair, equal and transparent access across all NSE nationwide
locations and to provide connectivity to the trading members as soon as possible.

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 RECOMMENDATIONS OF SEBI

The SEBI has also played an important role in the issue of the guidelines regarding online
trading so that the chances of fraud and misrepresentation are minimized.The stock brokers which
are being registered with Securities Exchange Board of India (SEBI) will have to apply to stock
exchanges for a formal permission. The following conditions must be fulfilled-

 The online trading company must have a minimum net worth of Rs 50 lakh
 The encryption technology should be there in the system used by the brokers to
ensure the provision for confidentiality ,security ,justifiability and reliability of data .The
user id, first level and second level password, automatic expiry of passwords at the end of a
reasonable period,
 The brokers must maintain adequate back-up systems and data storage capacity
which must be checked by the stock exchanges.
 SEBI has recently announced that to reduce the fraud cases each and every broking
house has to give back the full amount of customer after each three month, they will have to
show the zero balance of every customer’s account at the end of every 3 month
 The minimum qualification must be laid down by the stock exchange to ensure that
the persons hired by the brokers must have the proper qualification regarding trading so as
to guide the clients and he can communicate regarding trading instructions.
 To ensure the authenticity and accuracy of data a certification agency must be
appointed using the certification technologies when notified by the government or the SEBI.
 The better client and the broker relationship to be maintained.
 To determine the risk associated with the clients the brokers must have the have
sufficient verifiable information about clients and the stock exchange must ensure it.
 The clients must be taken into an agreement stating about all the obligations and
rights including the minimum service standards to be maintained by the service provider
broker for services specified by SEBI/exchanges for Internet-based trading from time to
time.

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  The web site of the broker providing the online trading facility should contain
information rules and regulations affecting client broker relationship, arbitration rules,
investor protection rules, etc meant for investor protection. It should also provide and
display prominently hyper link to the web site/page on the web site of the relevant stock
exchange(s) displaying rules/ regulations/circulars. Ticker/quote/order book displayed on the
web site of the broker should display the time stamp as well as the source of such
information.
 An e-mail should be sent to he investor for the confirmation of his Order or trade.
 The limits of trading and exposure provided to the client must be set on system-
based control and brokers and exchanges must ensure it. The limits must be predefined by
the broker on the exposure and turnover of each client. The system of broker should be such
that it is capable of assessing the risk of the client as soon as the order comes in. The system
should inform the clients client the reports on margin requirements, payment and delivery
obligations etc.
 As per the regulations the Contract Notes must be issued to clients within 24 hours of
the trade execution.
 Cross trades of the clients will not be allowed with each other to the brokers using
Internet-based systems for routing client order and all orders must be offered to the market
for matching.

A separate working group has been set up to look into the surveillance and enforcement-related
issues arising due to Internet-based securities trading. However, general anti-fraud provisions (SEBI
Fraudulent and Unfair Trade Practices Regulations, 1995) will apply to all transactions involving
securities or financial services, regardless of the mediu.
5. ONLINE TRADING

Online trading involves investment activity which takes place over the Internet and it does not
require physical inclusion of the broker. An investor has to register with an online trading portal like
Investsmart.in, ICICIdirect.com,Religare, motilaloswal.com and sharekhan.com and many
companies like that and investor gets into an agreement with the firm to trade in different securities
according to the terms and conditions given on the agreement. As the servers of the online trading

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portal are connected all the time to the stock exchanges and designated banks the order processing
is done in real time and investors can also have updates on the trading.
They can also check the status of their orders either through e-mail or through the interface that
it cannot be accessed by a third party. Some options are usually given to users such as to link their
bank account, Demat accounts and brokerage accounts into a single interface. A single window is
also there for all exchanges and a single screen is there for the complete order routing mechanism.
The hardware used comprises Web and application servers, switches, routers, firewalls and security
devices, and specialized appliances. There are two broad models in play in the online brokerage
space-

 Bank-backed firms
 Entrepreneur-floated firms.

Bank-backed brokerages such as ICICIdirect and HDFC Securities have expanded on the basis
of their brand name and the trust of investors in them. The integrated 3-in-1 accounts offered by
these bank-backed brokerages help their parent bank by giving it accounts along with float income.
In second case i.e. Entrepreneur-backed companies like Investsmart, Indiabulls, Sharekhan,
Religare and IndiaInfoline have expanded by offering customers a mix of online and offline
accounts, higher margin finance amounts and lower brokerage rates. Though the bank based has
performed better but the latter have not lagged too far behind.

The reason why online trading has developed over conventional offline brokerage firms is that this
conventional method struggled with unfavorable economies. Staff cost is just one
example of it. As the markets opens for 335 minutes a day one dealer can at best execute 500 trades
in a day while online company like ICICI direct executes 150,000-200,000 trades a day on the
National Stock Exchange alone accounting for 3-4% of NSE trades of 5 million a day. It would
require a large amount of dealers to service this demand. Besides the salary costs it would also
demand huge expenses in real estate and support systems.
The offline model has got a downfall in the form of lower bandwidth and IT costs and the cost of
bandwidth has fallen to one-eighth of what it was in 2000 giving online broking an advantage
especially in the case of lower-volume retail investors. In 2004, 30% of volumes on the NSE comes

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from this and it gone up to 50% in year 2008-2009 providing explosive growth for online broking in
India.
To be a successful trading portal it will definitely depend on bunch of services provided by it for an
end-user. Most of the portals charge a small registration fee and brokerage based on various
conditions but it's important for the organization to keep focussed on customer-centric services and
delivery models to actually enjoy the most attention.

ADVANTAGES OF ONLINE TRADING

1. Provides with the Freedom of Information

The Internet provides a new sense of controlling our financial future as the amount of
investment information available online is truly outstanding. An investor can-

 Know the price of any stock he desires at any point time on the internet.
 An investor can review the price history of any stock in chart format online
 An investor can follow in-depth the events happening in the market
 Helps an investor in receiving a wealth of free commentary and analysis about stock
markets in the global economy
 Helps an investor to conduct an extensive financial research of any company he
desires
 He may also consult with other investors online present around the world
Some online stock broking companies provide real-time stock quotes, daily roundups

of the stock market, expert commentary, and a deep community of fellow investors.

2. Provides Control to Investors Money

When an investor wants to buy or sell stock he no longer need to call his broker on the
phone thus helping in the execution of the order instantly on the internet.

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 3. Provides access to the market

Through the sophisticated information streams, dedicated trading platforms and

Sophisticated tools the investor can access the markets which provide more agility in

buying and selling stocks .

4. Ensures the best price for investors

Some companies like Investsmart (IL&FS)specialize in the techniques which offers

the best price deals for the buy and sell orders of the investors and traders providing the high
level of transparency by displaying of information relating to the specific stocks and
company profiles which helps in getting the best quote for the orders.

5. Online trading offers greater transparency

Online trading offers the investors with greater transparency by providing with an
audit trail. The process involves a complete integrated electronic chain starting from order
placement, to clearing and settlement and finally ending with a credit into the depository
account of the investor. All these stages are inspected which brings the transparency into the
system.
6. Provides hassle free trading

Online trading provides an integration of the bank account, trading account and
demat accounts, which leads to easy and paperless trading for the client.

7. Online trading allows instant trade execution

Online transactions helps in the quick execution of the entire trading transaction
right from logging to the traders site and to the settlement of the bank account in a very
short period of time.

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 8. It provides a level playing field

Trading online gives even the smallest retail investor access to information which
was earlier available only to the big traders. It has provided with a level playing field for all
investors in the securities market.

9. Online trading reduces the settlement risk

This method of trading reduces the settlement risk for the investor as when a short
sell order is played the orders are squared off at the specified cut-off time and are not
allowed to be carried forward.

10. Provides live financial news & analysis

The online sites also provide live terminals which provide streaming news to give
investor the latest financial information as it occurs.

11. Online help desk

Some companies provide online help desk an investor cancan contact the Tele
Trading Executives from the Tele Trading team during and after market hours and can
clarify questions.

12. Instant order trade confirmations

Through online trading every trade is confirmed immediately and investor receives an
on-screen confirmation following every trade with full details for the investors records
which avoids costly errors that would have been discovered when it is too late.

13. Keeps Information Secure

As per the guideline provided by SEBI every effort has to be made to keep the
investors account and personal information secure by use of encryption technology and
updated security technology to advanced fraud prevention measures.

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DISADVANTAGES OF ONLINE TRADING

 In online terminal, investor can’t get customized expert advice, whereas in offline
the broker gives suggestions according to investors strategy (i.e. short term or long-term)
 Brokerage is high compared to offline.
 Privacy is less due to hacking scandals
 Transactional errors due to technical problems

6. THE EMERGENCE OF ONLINE TRADING IN INDIA

Company Profiles It includes company profiles of the following companies.

Indiabulls Financial Services Limited (www.indiabulls.com)
India Infoline (www.5paisa.com)
Sharekhan (www.sharekhan.com)
Karvy (www.karvy.com)
Religare Securities (www.religare.in)
And finally the comparative Competitor analysis is done on the basis of
• Product Comparison
• Pricing Comparison
• Service Comparison
The competitive positioning of various firms is also studied on the parameters such as
Website: Ease of use, Pace of transaction execution, Trading Terminal facility, Tie up with
banks, Branch network and Customer service.

Indiabulls

HQ Region Delhi Area, India

Industry Financial Services
Type Public Company
Status Operating
Company
10,000 employees
Size
2007
11,819 million [INR] (102%)
Revenue

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 Founded 2000
Website http://www.indiabulls.com

Indiabulls Group is one of India’s top Business houses with businesses spread over Real
Estate, Infrastructure, Financial Services, Securities, Retail, Multiplex and Power sectors.
The group companies are listed on important Indian and Overseas markets. Indiabulls has
been conferred the status of a “Business Superbrand” by The Brand Council, Superbrands
India.

India Infoline

The India Infoline group, comprising the holding company, India Infoline Limited and its
wholly-owned subsidiaries, straddle the entire financial services space with offerings
ranging from Equity research, Equities and derivatives trading, Commodities trading,
Portfolio Management Services, Mutual Funds, Life Insurance, Fixed deposits and other
small savings instruments to loan products and Investment banking. India Infoline also owns
and manages the websites www.indiainfoline.com and www.5paisa.com The Company has
a network of 976 business locations (branches and sub-brokers) spread across 365 cities and
towns. It has more than 800,000customers.

HQ
Mumbai Area, India
Region
Industr
Financial Services
y
Type Public Company
Status Operating
Compa
15,000 employees
ny Size
Founde
1995
d
Websit http://www.indiainfoline.
e com

Sharekhan

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Sharekhan Limited offers online security broking and portfolio services to institutions and
large corporate houses as well as individual investors. Sharekhan Limited was formerly
known as SSKI Investor Services Private Limited. The company is based in Mumbai, India.

HQ
Mumbai Area, India
Region
Industry Financial Services

Type Privately Held

Status Operating
Company
1001-5000 employees
Size
http://www.sharekhan.
Website
com

Karvy

Karvi is a leading player in the financial services industry in India. Karvy has presence with
leadership position in a wide range of financial services including Broking, Commodities,
Registry Services, Merchant Banking, Realty services etc. The group also has presence in
the BPO services and technology services space. IT’S a professionally managed and highly
focused financial intermediary in the Indian markets.
HQ Region Hyderabad, India
Industry Financial Services
Type Public Company
Status Operating
Company Size 7,000 employees
Founded 1981

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Website http://www.karvy.com

Religare

Religare Enterprises Limited (REL) is a global financial services group with a presence
across Asia, Africa, Middle East, Europe and the Americas. In India, REL’s largest market,
the group offers a wide array of products and services ranging from insurance, asset
management, broking and lending solutions to investment banking and wealth management.
The group has also pioneered the concept of investments in alternative asset classes such as
arts and films. With 10,000 plus employees across multiple geographies, REL serves over a
million clients, including corporates and institutions, high net worth families and
individuals, and retail investors.

HQ Region Delhi Area, India

Industry Financial Services
Type Public Company
Status Operating
Company
10,000 employees
Size
Founded 2006
Website http://www.religare.in

Competitive Analysis on the basis of product, Charges and Service Offered

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In online trading Indiabulls has mainly competition with Religare, ICICI-Direct and
Sharekhan. Prabhudas Lilladher broking has an advantage of being in this industry for more
than six decades. It has launched its website and was among the first players in the online
share trading. All companies have decided to spend its advertisement budget through four
media i.e. Television, Print, Web and Outlets.

Comparison between Advance brokerage charging firms

Religare come up with less brokerage charges but big advance brokerage . Major Ganiz here
stands somewhere between religare and Sharekhan Securities( which charges less advance
brokergae than Religare and much lesser brokerage charges).Here Reilance money provides
option of different upfront brokerage at the same advance brokerage fee, with different
trading limits.Major Gainz advance brokerage schemes come in form of two plan types:
Power and Turbo Range respectively.Plan pricing is mentioned under Pricing ‘P’ of service
marketing in Project later.

Advance Upfront
Tradin
Plans Brokerage brokerag Validity
g limit
fee e
A 750 500 1 year 2 lakhs
2
B 750 1000 1 crore
months
6
C 750 2500 6 crore
months

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 12
D 750 5000 7 crore
months
12 20
E 750 10000
months crore
Fig : Advance brokerage plans at Reliance Money

Fig : Advance brokerage plans at Religare Securites

Certaintly if we compare different Advance brokerage plans than Reliance Money stands out
as unique and chapest advance brokerage plan provider as different upfront brokerage at the
same advance brokerage fee, with different trading limits make it simple and easy to
prospects.
On the other hand Sharekhan Securities comes up with different advance brokerge plans
which are designed considering usage rates of customers.Advance brokerage plans by
Religare Securities are least complicated to understand and come in only two account type :
Raily Dhanaka Plus and Raily Dhamaka Grand respectively. These two plans require
lesser advance brokerage and brokerage charges than Sharekhan Securities.

Fig : Advance Brokerage plans by Sharekhan Secutities

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 7. GROWTH OF ONLINE TRADING

According to an article by Krishnamurthy B in 2005 after inception of online trading in

India in the year 2000 online trading is gained momentum with trading volumes growing by 150
per cent per annum in the years 2003-2005 and it was more than approx. 250% in the year 2009
The volume of all trades executed through the Internet on the National Stock Exchange had grown

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from less than Rs 100 crore (Rs 1 billion) in June 2003 to over Rs 700 crore (Rs 7 billion) in July
2005 which was a handsome growth in the year 2005in the starting of 2008 the growth of online
share was good but at the mid of the year when subprime crisis affected India including all over the
world, market of online trading got shrunk by more than 50%.

Now the growth of online trading is on its right track ,Indian stock market has been announced
the one of the Safe and stable market of the world, so here in India the online trading is growing like
anything in comparison to the whole world

At the end of July 2009, there were more than 600 registered brokers on the NSE and the number
of Internet trading subscribers to about 2.024 million. In the year 2007 India has 8 crore (80
million) internet user, the % of internet user is growing in each year

At the same time the number of subscribers trading through the portal of Kotak Securities had
gone up significantly by 150 per cent and the number of online trading customers had grown from
30,000 to 75,000. And the company expected to have at least 130,000 customers by the end of that
fiscal. In the recent past years of 2005 ICICIDirect and Indiabulls recorded an annual volume
growth of 100 per cent and Indiabulls had about 30 per cent of India's online trading volumes.

Today the total volume of online trade in India is about 29-31% of total trades.
According to brokers the better broadband connectivity across the country and wider awareness of
equity as an asset class will raise the online trade volumes to over 50% of total trade.In India the
demography is such that 75% of the population is under the age of 36 and more than 50% of the
75% is under age of 25 and this is another supporting factor

The Chief Executive of Reliance Money Ltd says that online investing is still at a nascent
stage in India and expects that Internet-based trading will eventually take about half of the total
stock market trading as like with developed markets such as the US. Philippines has the highest
online trade with about 55-60% execution of trade is online. The reason is because they had wider
Internet connectivity years before India. The biggest challenge in India remains better Internet
connectivity. The earlier Web-based technology used for Internet trading has been replaced by

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specialized software which gives real-time global data streaming rates to trader helping investors to
analyze the market trends and helps in faster execution of trades. Earlier the investors made trade
calls over the phone which sometimes led to the delays.

Online share trading in India was at a boom in the end of 2006 with daily-traded volumes
more than tripling from Rs 1,500 crore to Rs 5,000 crore in the last one year and terminals was set
up in small towns such as Rajkot, Hubli and Vijayawada .In that year the share of online trading
rose dramatically from 7% last year to 20% as a percentage of overall traded volumes. Due to this
factor the top five US brokerage firms decided to make a foray into India in the next year driven by
strategic interest. Also at that time non-metros accounted for half of the daily turnover of online
trading.
Graph is showing the declining in the turnover of online trading in Indian stock exchange during
slowdown in economy due to subprime mortgage crisis.

A crash of the market in the early February 2008 the investors remained away from online
trading the turnover of the NSE from internet-based trading dipped to a daily average of Rs 1,648
crore between February 1 and February 8 as compared with Rs 3,450 crore in January 2008 Rs
3,587 crore in December 2007 and Rs 4,417 crore in November 2007 in the exchange’s cash market

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segment. In the mid February 2008 it accounted for just 12% of NSE’s total cash turnover as
compared with a high of 24% in November last year.

"Issues that need to be addressed are education on cyber crime and the security solutions
around it," says Vinesh Menon, Deputy CEO & Head for Online Investment & Branch Channel,
Bajaj Capital

"It's a matter of time when we will see exponential growth in the online trading segment, not
just through the computer but also through our mobile phones," adds Menon. With over 20 million
investors,

India boasts of the third highest investor base in the world, unthinkable till a few years ago.
The most online stock broking companies started from 2000 onwards because of development of
global Internet economy and for years 2000 to 2003 the stock market was under a bear hug. The
intense competition among a new wave of online brokerage companies hammered down brokerage
rates from 1% (in 2000) to 0.25 %, or even lower to 5 paisa

The number of investors opting for online trading has gone up manifold, according to the
recently published 'India’s Leading Equity Broking Houses, 2008' by Dun & Bradstreet (D&B). The
publication says that less than 10% of the 191 broking firms surveyed reported huge growth in
opening of e-broking accounts and some firms saw a surge in value of up to 400% in e-broking
during 2007

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 According to the report, numbers of e-broking accounts registered in 2007 have grown
exponentionally. Indiabulls Securities Ltd added 4,51,611 accounts while a relatively new firm in
the industry, Reliance Money added 2,15,678 accounts during the same time period. Motilal Oswal

Securities Ltd managed to add 19,065 accounts while Unicon Financial Intermediates Pvt Ltd could
increase their e-broking accounts by 13,787

According to market watchers, the rise in the value of on line transactions is also because of
sustained bull run witnessed in 2007, when the 30-share Sensex of the Bombay Stock Exchange
(BSE) gained from 13,842 points to 20,207 points, a gain of 6,365 points (up 47%).

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 E-broking is contributing a sizeable portion to the trading volumes and also to the revenue
generated for leading stock broking firms. Some examples of the percentage contribution to trading
volumes contributed by e-broking are 91% in case of Reliance Money, 62% for India Bulls, 20%
each for ASL Capital and Shreyas Stock, 19% Angel Broking, and 15% Farsight Capital. In respect
of revenues generated from e-broking, India Bulls (63%), Reliance Money (54%), Unicon Financial
(30%) and Shreyas Stock (20%) reported higher shares in 2007. Ashika reported 98% growth in e-
broking business in the first 10 months of 2007.

Another significant trend is the growth in international business of broking firms. Firms that
reported presence of offices outside India include Reliance Money, Motilal Oswal, Karvy Stock
Broking, JRG securities, Vogue and Bonanza Portfolio.

HDFC Securities have 500,000 online customers’ deals in daily online trades worth Rs 250-
300 crore is also in the black. The revenues it had in 2007-08 is Rs 100 crore. HDFC Securities had
revenues of Rs 67 crore and a net profit of Rs 7.21 crore in 2006-07. ICICIdirect has 1.5 million
online broking accounts and parent ICICI Securities reported revenues of Rs 750 crore for March

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2008. The new player Reliance Money has 2 million online accounts trades worth Rs 2,000 to Rs
3,000 crore per day.

8. ANALYSIS PART

Ans.1 What is your education qualification?

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INTERPRETATION

the people who are dealing with the stock market either online or offline. mort of them are
graduate,49%of the total respondent who are dealing with the stock market are graduate, then 16%
are post graduate and 22%people is having professional degree. So here this is showing that
qualification up to graduation or more than that is in the favour of the online trading pattern

Ans. 2 What is your annual income?

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INTERPRETATION

58%respondent are having the income level of 100000-200000 ,21% is having 200000-
300000 , 12% in having300000-400000 , 7% of the total respondent are having income more than
400000 per annum and only 2% are having less than 100000 per annum.
To invest in the stock market minimum 100000 or more than this should be the annual
income level of the people. In India the per capita income in also increasing so we can say that there
is a good opportunity for the online trading market.

Ans.3 What percentage of your monthly household income could be available for investment?

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INTERPRETATION

According to the data 23% of the total respondent invest less than 5% of their income,
41% respondents are saying that they invest 5%-10% of their monthly income (which is highest)
Whereas the 21% investor do the investment 10%-15% of their total monthly income,13 invest
between 15%-20% of the total income and only 2% does more than 20% of their income invest in
the market
We can easily understand that 75% of the total population is having a good amount of
investment, so the investment is their in the market, good number of people are ready to invest a
good amount in the market
91% of respondent is in the income level of 100000 – 300000 (according to the last question
analysis).
So we can say that stock brokerage houses will have to do a good business with the help of
Online trading system with few value addition services
Ans.4 Where do you often invest your money?

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INTERPRETATION

Highest number of respondent is having their investment in the equity that is 65% whereas the
investment available for the mutual fund, term deposit and insurance is 14% ,12% and 9%
So the investor for equity is high which is again showing the n number of opportunity for online
trading

Ans.5 what is the primary objective of your investment?

INTERPRETATION

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 13% of the respondent invest the money for the reason capital appreciation but most of the
investor is having same motive that is source of income and retirement plan, wealth preservation
and education funding for children or other are only 10%
From the analysis we can have idea that the main objective of the investor to earn the money
through trading in stock market 77% of the respondent achieve their objective with the help of
investment in the equity market, because most of the investment take place in the form of equity
(explanation of 4th ans. )So we can say that there is a huge potential in the market for the trading in
the stock market

Ans.6 Do you owe a Computer?

INTERPRETATION

78% of the total respondent who are dealing with the stock market is having computer in their
house and only 22% is not having computer in their house
The people who is having computer that is 78% can also go for online trading which can be a
large number of people who will go for online trading. they don’t need to do a additional investment
for computer to go for online trading

Ans.7 To operate a computer is easy for me

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INTERPRETATION

76% (26+51) of the total respondent believe that operate a computer is easy for me whereas
20%(13+7) of the respondent is having problem to operate a computer out of that 20% , 75 believe
that they can’t go for computer
So ,if 78% of the people who are dealing with the stock market is having computer at their house
and around 76% of the same population don’t have any problem to operate a computer
So around 60 % is their who is having computer and they don’t have problem to operate a computer

Ans.8 online trading is a secure way of trading.

INTERPRETATION

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 71% of the respondent is having a positive thinking that online trading is a secure way of
trading whereas 185 of the respondent believes that online trading is not a secure way of trading
Satisfaction about the process, by which they will be going to do a trading that is online trading,
should be there in the mind of the customer. If they believe that their is no risk over the money
which they are going to invest in the market with the help of online trading, there will be a
perception to go for online trading at least one time

Ans.9 online trading is easy and fast way of trading?

INTERPRETATION

51% of the total respondent believe that online trading is a easy task Whereas 41% of the
respondent believes that to deal with online Trading is not a easy task and 85 was confused to
anything about that the trading via internet is a easy task or not
There is a difference between the people who believe and who don’t believe is not very big that
is only 10% , the reason of this problem can be if a person is doing its investment on its own he or
she think of the problem of being mistaken in the transaction. So there is a need of proper training
to do trading online

Ans.10 At what time do you trade?

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INTERPRETATION

45% of the total respondent do trading in office timing while 32% do trading in non office
timing and 23% of the respondents do the trading in free time.
Here the people who do the trading in office timing they face the problem of not in the continuous
touch of the stock market, so online trading can be one of the good solution of this problem.

Ans.11 Introduction of online trading helped to attract the new Investors thus increasing the
trading volumes at Stock Market?

INTERPRETATION

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 76% of the respondent believe that the introduction of online trading helped to attract the new
customer became the reason to increase the trading volume of the market On the other side 16% of
the respondent believe that it doesn’t affect the trading volume

Ans 12 . What factor would you consider before choosing an account in a brokerage house?

10. CONCLUSION

The online trading is growing with a rapid pace with the rising level of education among the
customers. The other factors being that the Indian Investor nowadays wants to deal himself in
trading rather than depending upon other middlemen. They also consider the factors like time
saving in doing the online transactions, convenience etc. Although some people feel that online
trading is not secure but the people doing the trading online is happy about the increasing security
concerns among the companies.

The year 2008 has not been so good for the stock market and the Sensex and Nifty has been
dipping and affecting the business negatively for these companies. This is due to the fact that at
these times people do not prefer to open the DMAT and Trading accounts. So the companies have
to reduce their account opening fees to attract more and more customers. Also people trade very less
in the bearish market and the company’s profits against brokerage fees soars downwards. It is also a
found fact that during the bearish market the ratio of online trading becomes very less. Also there is

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an intense competition among the companies and the companies come up with new and new
promotion schemes such as discounted and negotiable brokerages, Zero balance accounts, waiving
a/c opening fee and AMC etc. As the internet penetration is growing in India this business holds a
huge potential for growth.

Now if the existing company will have to capture the market they will have to look for the
innovation in their product as well as service mix

The mantra for success in the current situation will be educating the customers about the
benefits of online trading and the amount of ROI that can be generated through it.

11. RECOMMENDATIONS

 The companies should come up with more and more innovative features in their web
portals.

 We came to know about most important factor about the product with the help of
factor analysis , so we should go for change the product according to the customer need

 We should also focus upon the value added services. Generally company does claim
that if you will by the product you will get these benefits but company doesn’t provide the
services here. So services always does matter when we talk of ONLINE TRADING

 Company should also look for the problem which customer generally face when
they do trading (like problem of operating properly)

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  The customer should be educated regularly regarding the new technologies and
techniques of trading online and also other relevant information.

 The companies should look after to develop more safe and secure ways of
transacting business online.

 The companies should make maximum efforts to detect fraud cases and minimize
them.

12. INDUSTRY RELEVANCE

My research project is Quite Relevant to the Investment Industry. The following things can
be useful for Prabhudas Liladher Pvt. Ltd.

 Prabhudas Liladher will be able to know their market position with other
competitors.

 The company will also get to know some areas of improvement which came forward
through my research.

 The changing perception of Indian consumers and their requirements will also be
made clear.

 The company will be able to do the effective segmentation of their market based on
the research analysis.

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  The investment companies at large will be able to understand how to keep
themselves abreast with the changing technology.

13. LEARNINGS

The two month summer training was a good experience for me to learn the practical aspects
of the corporate life. Some of the learning of mine is:

 I improved my communication skills by learning how to talk to different kind of

people as it requires the different approach to handle each person.

 I learnt how to manage a team of member to achieve a goal

 I learnt how to handle the pressure under difficult situations.

 I became aware about various aspects of working of stock exchange

 I learnt few things about back office work

 I learnt about the consumer perception about the stock market and online trading.

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  Patience was the thing I learnt the most as I have to approach the clients who were to
be explained same things again and again while approaching or calling them at regular
Intervals.

14. BIBLIOGRAPHY

 httpeconomictimes.indiatimes.comarticleshow4758236.cms
 http business.mapsofindia.comonline-tradingicici.html
 http business.mapsofindia.comonline-tradingkotaksecurities.html
 www.investsmart.in/ilfs-webapp/RetailOfferings/RetailIndex.jsp
 http business.mapsofindia.comonline-tradingindiabulls.html
 www.investsmart.in/ilfs-webapp/InstitutionalOfferings/InstitutionalIndex.jsp
 Httpin.reuters.comarticlepersonalFinanceidINIndia-40914120090709pageNumber=2
 http://EzineArticles.com/?expert=Tanya_Lobo
 www.investsmart.in/ilfs-webapp/Home/AboutUs/CompanyProfile.jsp
 httpbusiness.mapsofindia.comonline-tradingbest-online-trading.html
 www.the financialexpress/home/growth of market.htm
 www.rediff.com/money/2005/aug/31trading.htm

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  www.reliancemoney.com/Aboutus.aspx
 www.icicidirect.com
 www.kotakstreet.com
 www.bseindia.com
 www.nseindia.com
 www.bseindia.com
 www.sebi.co.in

QUESTIONAIRE

(To understand the perception of customer toward online trading)

NAME
_______________________________________________________________________
AGE ______________________________ GENDER
____________________________
MOBILE
_______________________________________________________________________
OCCUPATION
_______________________________________________________________________

Q.1 What is your education qualification?

 higher Secondary
 senior secondary
 Graduate
 Post Graduate
 professional degree holder

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Q.2 What is your annual income?
 Below 100000
 1,00,000 – 2,00,000
 2,00,000 – 3,00,000
 3,00,000 – 4,00,000
 Above 4,00,000

Q.3 What percentage of your monthly household income could be available for investment?
 Less than 5%
 5% to 10%
 10% to 15%
 15% to 20%
 More than 20%

Q.4 Where do you often invest your money?

 Equity
 Mutual fund
 Insurance
 Term deposits
 Others

Q.5 What is the primary objective of your investment?

 Capital appreciation
 Source of income
 Retirement planning
 Wealth preservation
 Education funding /others

Q.6 Do you owe a Computer?

 Yes
 No

Q.7 To operate a computer is easy for me

 Strongly agree
 Agree
 Can’t say

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  Disagree
 Strongly disagree

Q.8 online trading is a secure way of trading

 Strongly agree
 Agree
 Can’t say
 Disagree
 Strongly disagree

Q.9 online trading is easy and fast way of trading?

 Strongly agree
 Agree
 Can’t say
 Disagree
 Strongly disagree

Q.10 At what time do you trade?

 Office Hours
 Non Office Hours
 Free Time

Q.11 Introduction of online trading helped to attract the new Investors thus increasing the
trading volumes at Stock Market?

 Strongly agree
 Agree
 Can’t say
 Disagree
 Strongly disagree

Q.12 What factor would you consider before choosing an account in a brokerage house ?

Tick the appropriate option according to your choice on the scale of 1 to 5

(Where 1 is Most important to 5 for least important)

S.NO. PRODUCT ATTRIBUTES

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 1 Variety of products offered 1 2 3 4 5
2 Time to open an account 1 2 3 4 5
3 Brokerage charged 1 2 3 4 5
4 Customer services 1 2 3 4 5
5 Software 1 2 3 4 5
6 Research reports 1 2 3 4 5
7 Efficiency at peak hours 1 2 3 4 5
8 Customer relationship 1 2 3 4 5
9 Compliance system 1 2 3 4 5
10 Infrastructure 1 2 3 4 5
11 Brand 1 2 3 4 5
12 Trading Calls/sms 1 2 3 4 5
13 Effective execution 1 2 3 4 5
14 Regular delivery of contract 1 2 3 4 5
notes
15 Market exposure 1 2 3 4 5
16 Recording confirmation 1 2 3 4 5
17 Access to back office 1 2 3 4 5
18 Comprehensive stock trading 1 2 3 4 5
portal
19 Employees skill 1 2 3 4 5
20 Helpline services 1 2 3 4 5
21 Guidance 1 2 3 4 5

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