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MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

INTRODUCTION: In the current economic scenario, fluctuation in the share market has put investors in confusion. One finds it difficult to take decision on investment. This is primarily, because of investments are risky in nature and investors have to consider various factors before investing in investment avenues. These factors include risk, return, safety, volatility of shares and liquidity. The main objective of the study is to analyze the equity shares and to know the where investors prefer to invest in stock market. Analysis has done on percentage method for studying equity shares. Those who have well knowledge in equity market they can go for equity investments rather that investing in mutual funds because no control on the expenses made by the fund manager. The study will guide the new investor who wants to invest in equity, by providing knowledge about the equities. 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.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

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 Dallal 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.

Trading Pattern of the Indian Stock Market

Trading in Indian stock exchanges is limited to listed securities of public limited companies. They are broadly divided into two categories, namely, specified securities (forward list) and non-specified securities (cash list). Equity shares of dividend paying, growth-oriented companies with a paid-up capital of at least Rs.50 million and a market capitalization of at least Rs.100 million and having more than 20,000 shareholders are, normally, put in the specified group and the balance in non-specified group.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Two types of transactions can be carried out on the Indian stock exchanges:

1. Spot delivery transactions "for delivery and payment within the time or on the date stipulated when entering into the contract which shall not be more than 14 days following the date of the contract

2. Forward transactions "delivery and payment can be extended by further period of 14 days each so that the overall period does not exceed 90 days from the date of the contract". The latter is permitted only in the case of specified shares. The brokers who carry over the outstanding pay carry over charges (can tango or backwardation) which are usually determined by the rates of interest prevailing.

A member broker in an Indian stock exchange can act as an agent, buy and sell securities for his clients on a commission basis and also can act as a trader or dealer as a principal, buy and sell securities on his own account and risk, in contrast with the practice prevailing on New York and London Stock Exchanges, where a member can act as a jobber or a broker only.

The nature of trading on Indian Stock Exchanges are that of age old conventional style of face-to-face trading with bids and offers being made by open outcry. However there is a great amount of effort to modernize the Indian stock exchanges in the very recent times.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

STOCK EXCHANGES: Exchanges are the physical locations where stocks are bought and sold. They are the sisters of the over-the-counter (OTC) market. The OTC refers to a market in which securities transactions are conducted through a telephone and computer network connecting dealers in stocks and bonds, rather than on the floor of an exchange. Together, these two markets form the secondary market. The primary and secondary markets together make up the stock market. Exchanges are located all over the world, with the most famous one being the New York Stock Exchange. The NYSE annually trades almost $12 trillion dollars worth of capital. Thousands of stocks are listed on this exchange. When you buy a stock, you will need to learn which exchange(s) list it. Other than locating a quote in the newspaper, with online trading and the automation of order systems, there is very little reason to determine where the stock trades from the customer's viewpoint. The Securities and Exchange Commission (SEC) regulates stock trading and exchanges. The National Association of Securities Dealers (NASD) administers additional regulation. The NASD makes and enforces rules for its members and enforces federal securities acts and the SEC makes rules for its membership. As you read more about investing, you will become more familiar with these organizations and their protective regulations.

BOMBAY STOCK EXCHANGE (BSE): This premier stock exchange is the oldest stock exchange in Asia. The origin of Bombay stock exchange dates back to 1875. It was organized under the name of the native stock and share brokers association as voluntary and non-profit making association. It was recognized on the permanent basis in 1957. In March 1995, the Bombay stock exchange has introduced screen based trading called BOLT (Bombay Online Trading).

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

The main objectives of the stock exchange are:


To safeguard the interest of investing public having dealing on the exchanges. To establish and promote honorable and just practices in securities transactions. To promote, develop and maintain well-regulated market for dealing in securities. To promote industrial development in then country in the country through efficient resource mobilization by way of investment in corporate securities.

NATIONAL STOCK EXCHANGE (NSE): The national stock exchange of India started its operation in 1994 at Mumbai. The genesis of the NSE lies in the recommendation of the pherwani committee (1991). The main promoters of NSE are IDBI, IFCI, LIC, GIC, SBI, Bank of Baroda, Canara Bank, Corporation Bank, Indian Bank, and Union Bank of India, Punjab National Bank, IL&FS.

THE MAIN OBJECTIVES OF NSE ARE AS FOLLOWS.


To establish the nationwide trading facility for equities, debt instruments and hybrids. To ensure equal access to investors all over the country through appropriate communication network.

To enable shorter settlement cycle and book entry settlement system. To meet current international standards of securities market.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

PRESENT CURRENT SCENARIO OF INDIAN STOCK MARKET:

Stock market: Indian Stock Market contains more than 20 Stock Exchanges, some of which are popular nationally as well as regionally. The first stock market started in the country was the Bombay Stock Exchange (BSE). Its the oldest stock market in Asia and was established as the Native Share and Stock Broker's Association in the year 1875.It has around 5000 listings and a volume of more than US$ 1 Trillion. The other most popular Stock Exchange is the National Stock Exchange (NSE). Its also the largest Stock Exchange in the country and third in the world. These two exchanges constitute a major part of the Indian Capital Market.

What is their purpose?

Stock markets basic role is to provide a platform for the masses of the country to invest their savings and also as a source of funds for various organizations and institutions. It provides an opportunity for any person to become a part-owner of the company by buying the companies shares. These shares can be sold and exchanged as well as used as collateral in certain cases. One can deal in a variety of financial instruments in a stock market such as Equity which has already been explained, Future's, Retail Debt, Wholesale Debt, Currency Future's, Derivatives, Bonds etc. Trading can only be performed by a registered broker of the respective stock one wants to deal in or through a broker.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Impact on The Economy:

The stock market has both positive and negative effects on the Indian Economy. Some of which are listed below

1.Provides a source of funding for organizations 2.An investment avenue 3.A source of income for investors 4.A source of revenue for the government in the form of taxes 5.A source of employment opportunities 6.Meeting place for investors and organizations 7.Idle funds of common investors can be used for profitable purposes

Present current scenario of Indian stock market The current condition of Indian markets have drastically improved. There is absolute transparency and instant transactions. All Indian Stock markets are now computerized and Internet Trading has become a common phenomenon. Indian stock markets have also developed a dynamic nature and can change from a bullish temperament to a bearish slide. Any small bit of information or even a rumour from any part of the country can affect the market and is a fairly accurate indicator of the prevalent atmosphere in the region or country. People from across the country and globe get in touch with minute wise readings on the stock market and gain a lot of trading aptitude after daily seeing BSE Stock Gainers or BSE top losers list which does a world of good to their investment portfolio.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Conclusions:

The Indian Stock Markets can be a very rewarding avenue of investment but the constant changes and the inherent dynamic nature of the markets can wipe out your funds or savings within a minute. Thus, the key words for every retail investor are to be constantly alert and very observant. Don't always rely on the daily list of BSE top gainers or BSE top losers as it only takes a minute to get the things changed here. Keeping ones eyes and ears open can the insure the investor against any major losses. Following such rules and with some experience and practice, one can emerge victorious and can churn out a fortune for himself as well. Hence, it is a way to turn your savings into a fortune.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

CAPITAL MARKET INTRODUCTION Market exists to facilitate the purchase and sale of goods and services. The financial markets exists to facilitate sale and purchase of financial instruments and comprises of two major market, capital market and money market the distinction between capital market and money market is that capital market mainly deals in medium and long-term instruments(maturity more than a year) while the money market deals in short-term instruments(maturity up to a year). Capital market is, thus, important for raising funds for capital formation and investments and forms a very vital link for economic development of any country. The capital market provides a means for issuer to raise capital from investors (who has surplus money available from savings for investment). Thus, the savings normally flow from household sector to business or government sector, who normally invests more than they save.

FUNCTIONS OF CAPITAL MARKET To mobilize resources for investments To facilitate efficient use of capital To facilitate buying and selling of securities To facilitate the process of efficient price discovery To facilitate settlement of transactions in accordance with predetermined time schedules.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

MAJOR ENTITIES INVOLVED IN CAPITAL MARKET: SEBI(Regulator) Stock Exchanges Clearing Corporation(CC)/Clearing Houses(CH) Depositories and Depository Participants Custodians Stock Brokers and their Sub Brokers Mutual Funds Merchant Bankers Credit Rating Agencies Financial Institutions Foreign Institution Investors Non-Banking Institutions Issuer/Registrar and Transfer Agents Investors Bombay Stock Exchange National Stock Exchange Merchant Bankers Brokers Underwriters and sub underwriters Agents

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

SEGMENTS OF CAPITAL MARKET: Capital market consists of 1. primary market 2. secondary market

1. PRIMARY MARKET: A market were the issuers access their prospective investors directly for funds required by them generally either for expansion or for meeting the working capital needs this process is called disintermediation where the funds flow directly from investors to issuers. Securities

COMPANY/ISSUER Funds

INVESTORS

Primary market comprise of market for new issues of shares and debentures, where investors apply directly to the issuer for allotment of shares/debentures and pay application money to the issuer. Primary market is one where issuer contacts directly to the public at large in search of capital. It also helps limited companies as well as Government companies to issue their securities to the new/existing share holders by making public issue/rights issue. After the public issue, the securities of the issuer are listed on a stock exchange(s) provided it complies with requirements prescribed by the stock exchange(s).

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

ACTIVITIES IN THE PRIMARY MARKET: Appointment of merchant banker Pricing of securities being issued Communication/marketing of the issue Information on credit risk. Making public issues Collection of money. Minimum subscription Listing on the stock exchange(s) Allotment of securities in demat/physical mode Record keeping

2. SECONDARY MARKET: In the secondary, market the investors buy/sell securities through stock exchanges. Trading of securities on stock exchange results in exchange of money and securities the investors. Secondary market provides liquidity to the securities on the exchange(s) and this activity commences subsequent to the original issue. For example, having subscribed securities of a company, if one intends to sell the same, it will have to be done in secondary market. Similarly, one can buy the securities of a company from the secondary market.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

A Stock Exchange is the single most impotent institution in the secondary market for providing a platform to the investors for buying and selling of securities through its members. In other words the Stock Exchange is place where already issued securities are bought and sold by the investors. Thus secondary market activities is different from the primary market in which issuer issue securities directly to the investors.

ACTIVITIES IN THE SECONDARY MARKET Trading of securities Risk management Clearing and settlement of trades Delivery of securities and funds

STOCK EXCHANGES: Exchanges are the physical locations where stocks are bought and sold. They are the sisters of the over-the-counter (OTC) market. The OTC refers to a market in which securities transactions are conducted through a telephone and computer network connecting dealers in stocks and bonds, rather than on the floor of an exchange. Together, these two markets form the secondary market. The primary and secondary markets together make up the stock market. Exchanges are located all over the world, with the most famous one being the New York Stock Exchange. The NYSE annually trades almost $12 trillion dollars worth of capital. Thousands of stocks are listed on this exchange. When you buy a stock, you will need to learn which exchange(s) list it. Other than locating a quote in the newspaper, with online trading and

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

the automation of order systems, there is very little reason to determine where the stock trades from the customer's viewpoint. The Securities and Exchange Commission (SEC) regulates stock trading and exchanges. The National Association of Securities Dealers (NASD) administers additional regulation. The NASD makes and enforces rules for its members and enforces federal securities acts and the SEC makes rules for its membership. As you read more about investing, you will become more familiar with these organizations and their protective regulations.

BOMBAY STOCK EXCHANGE (BSE): This premier stock exchange is the oldest stock exchange in Asia. The origin of Bombay stock exchange dates back to 1875. It was organized under the name of the native stock and share brokers association as voluntary and non-profit making association. It was recognized on the permanent basis in 1957. In March 1995, the Bombay stock exchange has introduced screen based trading called BOLT (Bombay Online Trading).

The main objectives of the stock exchange are:


To safeguard the interest of investing public having dealing on the exchanges. To establish and promote honorable and just practices in securities transactions. To promote, develop and maintain well-regulated market for dealing in securities. To promote industrial development in then country in the country through efficient resource mobilization by way of investment in corporate securities.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

NATIONAL STOCK EXCHANGE (NSE): The national stock exchange of India started its operation in 1994 at Mumbai. The genesis of the NSE lies in the recommendation of the pherwani committee (1991). The main promoters of NSE are IDBI, IFCI, LIC, GIC, SBI, Bank of Baroda, Canara Bank, Corporation Bank, Indian Bank, and Union Bank of India, Punjab National Bank, IL&FS.

THE MAIN OBJECTIVES OF NSE ARE AS FOLLOWS.


To establish the nationwide trading facility for equities, debt instruments and hybrids. To ensure equal access to investors all over the country through appropriate communication network.

To enable shorter settlement cycle and book entry settlement system. To meet current international standards of securities market.

ABOUT DEPOSITORY Depository is an organization where the securities of a shareholder are held in the electronic form at the request of the shareholder through a medium of a Depository Participant (DP). The principal function of a Depository is to dematerialize securities and enables their transaction in book entry form electronically.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

FOLLOWING TABLES COMPARES THE TWO

BANK Hold funds in account Transfer funds between accounts

DEPOSITORY Hold securities in accounts Transfer securities between accounts without physically handling

Transfer without physically handling money Transfer securities Safekeeping of money

Safekeeping of securities

In India the Depository Act defines a Depository to mean a company formed and registered under the companies Act 1956 and which has been granted a certificate of registration under sub-section (1A) of section 12 of the Securities and Exchange Board of India Act, 1992

DEPOSITORIES IN INDIA There are two depositories in India which provide dematerialization of securities. The National Securities Depository Limited (NSDL) and Central Securities Depository Limited (CSDL).

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

BENEFITS OF PARTICIPATION IN A DEPOSITORY Immediate transfer of securities No stamp duty on transfer of securities Elimination of risks associated with physical certificates such as bad delivery, fake securities, etc. Reduction in paperwork involved in transfer of securities Reduction in transaction cost Ease of nomination facility Change in address recorded with DP gets registered electronically with all companies in which investor holds securities eliminating the need to correspond with each of them separately Transmission of securities is done directly by the DP eliminating correspondence with companies Convenient method of consolidation of folios/accounts Holding investments in equity, debt instruments and Government securities in a single account; automatic credit into demat account, of shares, arising out of

split/consolidation/merger etc.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

DEPOSITORY PARTICIPANT The Depository provides its services to investors through its agents called depository participants (DPs). These agents are appointed by the depository with the approval of SEBI. According to SEBI regulations, amongst others, three categories of entities, i.e. Banks, Financial Institutions and SEBI registered trading members can become DPs. The depository has not prescribed any minimum balance. You can have zero balance in your account. CUSTODIAN: A Custodian is basically an organization, which helps register and safeguard the securities of its clients. Besides safeguarding securities, a custodian also keeps track of corporate actions on behalf of its clients: Maintaining a clients securities account Collecting the benefits or rights accruing to the client in respect of securities Keeping the client informed of the actions taken or to be taken by the issue of securities, having a bearing on the benefits or rights accruing to the client.

DEMATERIALIZATIONS OF SECURITIES: In order to dematerialize physical securities one has to fill in a Demat Request Form (DRF), which is available with the DP, and submit the same along with physical certificates one wishes to dematerialize. Separate DRF has to be filled for each ISIN number. Odd lot share certificates can also be dematerialized. Dematerialized shares do not have any distinctive numbers. These shares are fungible, which means that all the holdings of a particular security will be identical and interchangeable.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

REMATERIALISATION. If one wishes to get back your securities in the physical form one has to fill in the Remat Request Form (RRF) and request your DP for rematerialisation of the balances in your securities account. One can dematerialise his debt instruments, mutual fund units, government securities in his single demat account.

LEGAL FRAMEWORK: The Depositories Act 1956 provides for regulation of depositories in securities and for a matter connected there with on incidental there to and came into from 20th of the September 1995.SEBI formulated the Depositories and participants Regulation Act, 1996 to Oversee the matter regarding admission and working of Depositories and its participant. The Depositories Act passed by parliament received the presidents assents on August 10, 1996. The Act enables the setting up of multiple depositories in the country. Only a company registered under the companies Act (1956) and sponsored by the specified categories of institution can setup depository in India. The Depository offers services relating to holding of securities and facility processing of transaction in such securities in book entry form. The transaction handled by depositories include settlement of market trades, settlement of off-market trades, securities lending and borrowing, pledge & hypothecations.

FUNCTION OF DEPOSITORY PARTICIPANT


DEMATERIALIZATION: One of the primary functions of depository is to eliminate or minimize the movement of physical securities in the market. This is done through converting securities held in physical form in to holdings in to back entry form.

ACCOUNT TRANSFER:

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

The depository gives effects to all transfer resulting from the settlement of trade and other transaction between various beneficial owners by recording entries in the accounts of such beneficial owners by recording entries in the accounts of such beneficial owners.

TRANSFER & REGISTRATION: A transfer is a legal change of ownership of a security in the records of the insurer. Transfer of securities under demat occur merely by passing book entries in the records of the depositories, on the instruction of beneficial owners.

PLEDGE AND HYPOTHECATION: Depositories allow the securities with them to be used as collateral to secure loans and other credits. The securities pledged are transferred to a segregated or collateral account through book entries in the records of the depository.

LINKAGE WITH CLEARING SYSTEM: The clearing system performs the function of ascertainment in the pay in (sell) or payout (buy) of brokers who leave traded on the stock exchange. Actually delivery of securities from the clearing system from the selling brokers is and delivery of securities from the clearing system to the buying broker is done by depository. To achieve this depositories and the clearing system are linked electronically. To handle the securities in electronic form as per the Depositories Act 1996 two depositories are registered with SEBI. They are 1) NSDL -- National securities depository limited. 2) CDSL -- Central depository service (India) limited.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

NSDL India had a vibrant capital market, which is more than a century old, the paper-based settlement of trades caused substantial problems like bad delivery and delayed transfer of title till recently. The enactment of Depositories Act in August 1996 paved the way for establishment of NSDL, the first depository in India. NSDL promoted by institutions of national stature responsible for economic development of the country has since established a national infrastructure of international standard that handles most of the trading and settlement in dematerialized form in Indian capital market.

Using innovative and flexible technology systems, NSDL works to support the investors and brokers in the capital market of the country. NSDL aims at ensuring the safety and soundness of Indian marketplaces by developing settlement solutions that increase efficiency, minimizing risk and reduce costs. At NSDL, play a quiet central role in developing products and services that will continue to nurture the growing needs of the financial services industry. CDSL CDSL was set up with the objective of providing convenient, dependable and secure depository services at affordable cost to all market participants. CDSL received the certificate of commencement of business from SEBI in February 1999. Depository facilitates holding of securities in the electronic form and enables securities transactions to be processed by book entry by a Depository Participant (DP), who as an agent of the depository, offers depository services to investors. According to SEBI guidelines, financial institutions, banks, custodians, stockbrokers, etc. are eligible to act as DPs. The investor who is known as beneficial owner (BO)

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

COMPANY PROFILE

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Introduction: Motilal Oswal Security Ltd was founded in 1987 as a small sub-broking unit, with just two people running the show. Focus on customer-first-attitude, ethical and transparent business practices, respect for professionalism, research-based value investing and implementation of cutting-edge technology has enabled us to blossom into an almost 2000 member team. Today we are a well diversified financial services firm offering a range of financial products and services such as Wealth Management , Broking & Distribution , Commodity Broking, Portfolio Management Services , Institutional Equities, Private Equity , Investment Banking Services and Principal Strategies. We have a diversified client base that includes retail customers (including High Net worth Individuals), mutual funds , foreign institutional investors, financial institutions and corporate clients. We are headquartered in Mumbai and as of December 31st, 2009, had a network spread over 581 cities and towns comprising 1,293 Business Locations operated by our Business Partners and us. As at December 31st, 2009, we had 6,05,1986 registered customers

Headquarters Industry Type Status Company Size Founded Website

Mumbai Area, India Financial Services Public Company Operating Subsidiary 1001-5000 employees 1987 http://www.motilaloswal.c...

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Vision: To be the most respected and preferred Private Equity Manager in the mid size corporate segment.

Mission: To be well respected and preferred global financial services organization enabling wealth creation for all our customers.

Achievements and awards: Motilal Oswal Securities Ltd got starmine award 2009. 1. 2005, Asiamoney Brokers ranked most the best Indian brokerage firm in India. March 2006, AQ Research declared most the best research house for Indian stocks.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Product and Services:1. Equity and Derivative 2. Internet trading 3. Depository services 4. Equity Research 5. Mutual Funds, Bonds, IPOs 6. Life Insurance 7. Portfolio Management Services. 8. Commodity Futures Equity: Motilal Oswal Securities Ltd is a member of NSE and BSE, has a network of over 300 branches in India and abroad, rendering quality equity trading services. Motilal Oswal Securities Ltd not only has a strong offline presence but also provides automated online trading services. Motilal Oswal Securities Ltd is retail spread caters to the need of individual investors. Trading in equities is made simple, safe and interesting with smart advice from the research desk through daily SMS alerts, market pointers, periodical research, stock recommendations and customer meets organized frequently. The online trading system allows customers to track the markets by setting up their own market watch, receiving research tips, stock alerts, real-time charts and news and many more features enable the customer to take informed decisions. The brokerage structure makes Motilal Oswal Securities Ltd online trading all the more attractive:

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Derivative: Market with Index Futures being the first instrument. Now both the exchanges provide trading in Index Futures and Options and Stock Futures and Options. A derivative is a financial contract, between two or more parties, which is derived from the future value of an underlying asset. At any point of time there will always be available near three months contract periods. For e.g. in the month of Jan 2006 one can enter into Jan, Feb or Mar contracts. The last Thursday of each month is the expiry day for that months contract. When one contract expires, a new contract is introduced. For instance, on expiry of Jan 2006 contract, April contract shall get activated. Currently, settlements of all Derivatives trades are in cash. There is Daily as well as Final Settlement. As long as the position is open, the same will be marked to Market at the Daily Settlement Price, the difference will be credited or debited accordingly and the position shall be brought forward to the next day at the daily settlement price. Any position which remains open at the end of the final settlement day (i.e., last Thursday) shall be closed out by the Exchange at the Final Settlement Price, which will be the closing spot value of the underlying. There are two types of margins collected on the open position, viz., Initial Margin which is collected upfront and Mark to Market Margin to be paid on T+1 day. As per SEBI Guidelines it is mandatory for clients to give margin, failing which the outstanding positions may be closed out. In June 2000 National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) started trading in Futures on Sensex and Nifty. Options trading on sensex and nifty commenced in June 2001.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Internet trading: If you have access to Internet then you can register with us to view your demat account over the Internet. This is very beneficial as you can avail of a host of services at no extra cost. You will be able to view your holdings, reports, and ledger and will have free access to our research reports at any time Depository: A depository can be compared to a bank. It holds securities such as shares, debentures, bonds, government securities, units etc. of investors in electronic form. There are two depositories in India, The National Securities Depository Limited (NSDL) and Central Depository Services Limited (CDSL). An individual who desires to avail the depository services can approach a Depository Participant (DP). Banks, financial institutions, custodians, brokers or any other entity eligible as per SEBI (Depositories and Participants) Regulations, 1996 can apply to the Depository to become a Depository Participant. As on 31st December, 2005 there were 221 Depository Participants in India. Motilal Oswal Securities Ltd is a depository participant of NSDL. Investors can open demat accounts with NSDL through MOSL. One can approach the nearest branch of Motilal Oswal Securities Ltd for opening an account. Agreement charges (statutory charges) along with Annual Maintenance Charge (AMC) are collected upfront while opening an account. It takes two to three days to open a demat account. Upon activation of the demat account, a Welcome Letter is sent to the customer along with the Delivery Instruction Slip book

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

DP facilities and IPOs offered by Motilal Oswal Securities Ltd De-materialization: You can convert your physical shares into electronic form by surrendering the shares for dematerialization at the Motilal Oswal Securities Ltd branch. Re-materialization: Re-materialization enables you to convert the dematerialized shares into physical form. Repurchase: This facility helps you to submit the units of open-ended Mutual Funds in case of re-purchase. Pledge: You can pledge securities to avail a loan. Transfer: You can transfer securities from one demat account to another. IPOs: In case you have applied for an IPO and receive an allotment then the securities are transferred directly to your demat account. The same applies for bonus and rights issues. Commodity De-mat Account: If you are a commodity player, you may need to open a commodity de-mat account with Motilal Oswal Securities Ltd Speed-e: If you register for Speed-e services, then transfer instructions can be placed online over the internet to pre-notified Clearing Members Pool a/c. This does away with the need to submit a physical delivery instruction slip.

Internet services: If you have access to Internet then you can register with us to view your demat account over the Internet. This is very beneficial as you can avail of a host of

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Services at no extra cost. You will be able to view your holdings, reports, and ledger and will have free access to our research reports at any time. Research: Motilal Oswal Securities Ltd has a team of experts who track the markets and related events very closely. Sophisticated tools are used for technical analysis and research to offer recommendations, technical analysis and research reports. Each day Motilal Oswal Securities Ltd Research team brings to table information that helps you profit from it.

Daily Market View: Technical Analysis - Market, a daily report on markets gives a clear picture on the expected market movements (NSE and BSE). It also covers the key support and resistance levels. It also provides clues on market direction and the expected profit booking levels.

Daily Stock View: Technical Analysis - Stocks, a daily report on the stocks for the day. These are prepared

with "Departure Oscillators" tool that have a high degree of accuracy on stock readings; which in turn helps investors, day traders, High Net worth Individual's with stock ideas that may benefit them.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

F&O Analysis: F&O Analysis is a daily report that gives near 100% accurate reading on both Futures and Options. Tools such as PC ratios, Open Interest and volatility combined with RSI indicator are used for the purpose. It is helpful for day traders, long-term holders and HNI clients

SMS: SMS alerts are sent to those who have registered for the service. These are prepared with utmost care, ensuring that it is suitable for both the Bulls and the Bears. It provides instantaneous buy/sell/hold recommendations purely on technical. It also provides option strategies with the use of Implied/Historical Volatility study. SMS is especially handy for Index Traders. Distribution: Motilal Oswal Securities Ltd undertakes the distribution of variety financial instruments such as mutual funds, bonds, life insurance products, fixed deposits etc. The wealth center team understands the universe of investment options analyzes the risk and return from these options and recommends investment options to clients to help them achieve their financial goals. Portfolio Management Service: Motilal Oswal Securities Ltd a SEBI registered Portfolio Manager offers discretionary portfolio management services. Motilal Oswal Securities Ltd has a team of experts who carefully take investment decisions based on the clients' objectives. The Portfolio Management team has a successful track record of more than 10 years in the capital market. The team has access to Motilal Oswal Securities Ltd strong Equity Research, and Fundamental & Technical Analysis.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Investment Objective
To generate medium to long-term capital growth (2-3 years) by identifying undervalued stocks and those with growth opportunities from a select list of well researched stocks Investment strategy: The strategy aims to generate long term capital appreciation by creating a focused portfolio of high growth stocks having the potential to grow more than the nominal GDP for next 5-7 years across market capitalization & which are available at reasonable market prices. Organization structure:

MANAGER

SENIOR EXECUTIVE

ASSISTANT MANAGER

JUNIOR EXECUTIVE

FUNCTIONS OF STAFF 1. 2. 3. DEALING ACCOUNTING CLEARING

CUSTOMER RELATIONS

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Employees who deal with clients are expected to handle them with the utmost care. The client deserves immediate and total attention. No client issue should ever be postponed.

Deal Sourcing: Motilal Oswal Securities Ltd have benefit of utilizing resources of the Motilal Oswal Group. With over 1293 business locations in over 581 cities, the Group has knowledge of business and people from various parts of the country and acts as a valuable source of investment leads in addition to being an excellent source of background and reference checks on prospective investments.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

RESEARCH METHODOLOGY: PROJECT TITLE: A Study On Investors Perception Towards Equity Shares Objectives of the Project. To know, where the investors prefer to invest. To know why investors stay invested in equity shares To know overall satisfaction level in investing equities.

SCOPE OF THE STUDY Investor survey was done through questionnaire & also by observation. Analysis was done based on the responses given by respondents.

METHODOLOGY Methodology aims to present a clear idea of the research procedure used in this Study. Since the value of systematic and scientific research lies in the methodology the goals should be reached with accuracy using least amount of time. Precise planning prevents the study from deviating from the aims and objectives, the scope set forth. A clear understanding of the situation Analysis, problem statement, scope of the study objectives, research design universe, sampling techniques and tools of data collection is necessary as they lend credibility and will act as catalysts inputting the concept into practice Data Source: Data Sources are classified into: 1) Primary Data Source 2) Secondary Data Sources

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

1) Primary Data Sources: Primary data is collected by direct interview with investors with the help of Questionnaire. 2) Secondary Data Sources: Classified into Internal Secondary Data and External Secondary Data. i) Internal Secondary Data: Internal source of data represents the data this is already available with the company. Product profile, Information relating to plant locations etc. ii) External Secondary Data: External sources of data include all external information needed for the study. Newspapers, Business Magazines, Web sites are some important sources of information, which are used in this project work.

Sampling Process Sample size - 50 Area covered: Davangere city.

Methods of Data Collection The secondary data was collected from company website & prospectus. The primary data was collected through interview schedules in the form of printed Questionnaires which were direct and structured and self-administered. The interview schedules in the questionnaires addressed all the broad headings as defined in the objectives. The data collection field work was undertaken for about 25 days during which all the50 investors were contacted personally and interviewed individually using the questionnaires.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Analysis of this made on the bases investor response collected through Questionnaire
Occupation: Table1: Shows Occupation of Respondents Occupation Business Student Employee Others Source: Survey Frequency 38 20 26 10 Percentage 38% 20% 26% 10%

Interpretation: From the above table, it is clear that out of 100-sample size 38% of the Investors are businessperson, from this we come to know that most of the investors are businesspersons and they play a vital role in the stock market. Here they need to target on retired group so that they can acquire better market share.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Age Group: Table no.2: Shows Age group of Respondents Age 20-30 30-50 50-60 Above 60 Source: Survey Interpretation: From the above table, it is clear that out of the total 50-samples 20 to 30 and 30 to 50 age group people are the major investors. So here, the Motilal Oswal Securities Ltd target on these two groups because in these groups almost all businesspersons and employees are covered. Remaining part is shared by 50 to 60 age group and above 60 age group, which are 22% and 9% respectively. Annual Income Frequency 34 35 22 9 Percentage 34% 35% 22% 9%

Table3: Shows Annual income of Respondents Income Above 1 lakh 1-3lakh 3-5lakh Above 5lakh Source: Survey Frequency 34 53 8 5 Percentage 34% 53% 8% 5%

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Interpretation: From the above table, it is clear that out of 100-sample size 53% of the investors are having Rs 1-3 lakh annual income. From this, the middle-income level people are taking important role in investment in stock market. Second place goes to people group whose annual income is 34%. Rest of 8% and 5% of the investors are having the annual income Rs 3-5 lakh and above five lakh.

1) Invested In:

Table4: Shows Area of investment of Respondents


Investment sector
Infrastructure/Cement Power FMCG Pharma/biotech Others Frequency 24 20 22 14 20 percentage 24% 20% 22% 14% 20%

Source: Survey Interpretation: From the above graph, it is clear that out of 50-sample size 12 investors invested in infrastructure/cement .10 investors invested in power sector and the same in others. In addition, 11 investors invested in FMCG and 7 investors invested in pharma

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

3) Trade in equities: Table5:Table shows the how often investors trade in equities. Trade
Daily Twice in a week Once in a month Rarely Frequency 16 20 38 26 percentage 16% 20% 38% 26%

Source: Survey Interpretation: From the above table it is clear that out of total sample size, here 38% investors trade in a month, 26% investors trade rarely, 20% trade twice in a week and 16% trade daily.

4) Investors pick the stocks based on the these factors Table 5: shows the factors consider while selection of the stock Factors
Past returns Frequency 28 percentage 28% 34%

Future prospectus of the 34 company Management company Based on M 24 of the 14

14%

24%

capitalization

Source: Survey

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Interpretation: From the above graph, it is clear that out of total -sample size, the factors considered by the investors in selection of the stocks are, 34% of the investors pick the stocks on the bases of future prospectus of the company, 28% investors pick the stocks on the bases of past returns 24% investors based on M capitalization and 14% investors based on management of the company.

5) Which type of shares would you prefer? Table 6: Table shows which type of shares will prefer investors Types of shares
Defensive Aggressive Medium Frequency 14 36 50 percentage 14% 36% 50%

Source: Survey Interpretation: From the above table, it is clear that out of total sample size 50% of the Investors prefer medium shares,36% investors prefer aggressive shares and 14% investors prefer defensive.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

6) Objective of investment Table 7: Shows Objective of investment of Respondents

46% 50 45 40 35 30 25 20 15 10 5 0 Future security Regular return 16% 12% Series2 Series1 26%

Tax Benefit

Asset accumulation

Interpretation: From the above table, it is clear that out of total-sample size, 46% investors are having objective of future security.26% respondents having regular return, 12% are having asset accumulation and 16%are having tax benefits.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

7) Investment strategy of respondents after global market meltdown (2011) Table 8: Shows investment strategy of respondents after global market meltdown (2011) Strategies Investing in more equities No change in the investment pattern Investing less in equities No comments Source: Survey Frequency Percentage

30

30%

22 32 22

22% 32% 22%

35 30 25 20 15 10 5 0

30% 22%

32%

Series2 Series1

Investing in more equities

No change in the Investing less in investment equities pattern

Interpretation: From above graph it is clear that out of total sample size 32% investors are investing less in equities after global market down, 30% of investors investing more in equities

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

after global market down and 22% investors not changed in their investment after global market down.

8) What percent investors book the profit? Table 9: shows the percentage of the respondents in booking of the profit. Profit Less than 10% 10-15% 20-30% Above 30% Frequency 12 60 22 6 Percentage 12% 60% 22% 6%

Source: Survey

Interpretation: From above table it is clear that out of total sample size 60% of the investors book their profits 10-15%, 22% of the investors book their profits 20-30%, 12% investors book their profit less than 10% and 6% investors book their profit above 30%.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

9) How often investors revise their portfolio Table 10: shows the how respondents revise their portfolio Year Less than 1 year 1-3 yrs 3-6 yrs 6yrs & above Source: Survey Frequency 22 70 4 4 Percentage 22% 70% 4% 4%

Interpretation: From above graph it is clear that out of total sample size 70% investors are revise their portfolio between 1-3 yr, 22% of investors revise their portfolio less than 1 yr ,4% of investors revise their portfolio between 3-6 yr.4% of investors revise their portfolio 6 yrs and above.

10) Investors satisfaction in investment decision. Table 11: shows the respondents satisfaction in investment decision. Frequency Very satisfied Satisfied Neutral Dissatisfied Source: Survey 22 70 4 4 Percentage 22% 70% 4% 4%

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

70 60 50 40 30 20 10 0 Very satisfied Satisfied Neutral Dissatisfied 70%

Series1

22% 4% 4%

Interpretation: from above graph it is clear that out of total sample size 70% of the investors are satisfied in their investment decision, 22% of the investors are very satisfied in their investment decision , 4% of the investors are neutral and 4% of the investors are dissatisfied in their investment decision.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

11) Investors convenience with share broker.

Table 12: shows the respondents convenience with share broker.

convenience

Frequency

Percentage 4%

Ease of A/c 4 openings Exposure given Less brokerage. Near to my 16 home/office Good service 32 12 10

10%

12%

16%

32%

Good given Honesty

tips 12

12%

10

10%

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

35 30 25 20 15 10 5 0 4% 10% 12% 16%

32%

12%

10% Series2 Series1

Source: Survey

Interpretation: from above graph it is clear that out of total sample size 32% of the investors convenience with share broker by good service.

12) Investors interest among dividend shares, bonus shares, and right shares:

Interpretation: Out of total sample size it is clear that 50 respondents prefer first dividend shares, second bonus shares and third right shares.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

FINDINGS Investors study the markets, industry, firms before taking deciding about investment. Out of 100 investors, 38% of them are businessman and 35% are of the age group between 30-50 years. Income of an investor is an important factor, which affects his investment potential. In addition, 53% of investors have their income level is between 1 to 3 rupees lakh per annum.. Main Objective of investments is future security and regular return. Here out of 100 respondents, 24 % invested in infrastructure and 22% FMCG sectors. Most of the investors trade once in a month. Most of the investors pick the stocks based on future prospectus of the company. Most of the investors go for medium shares. 48% of the investors objective is future security. After market meltdown most of the investors have not changed their investment pattern. Out of 100 respondents 70 respondents revise their portfolio between 1-3 years. Out of 100 respondents 64 respondents satisfied with their investment decision. 32 respondents have the convenience with the share broker for their good service. 50 respondents prefer dividend shares first and bonus shares next and lastly they prefer right shares.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

SUGGESTIONS: Concentrate more on income group above 5 lakh per annum preferably businessmen & salaried people. Because they invest only 5%. It is better to target these groups because their earning is more and they can invest more. Conduct seminars to the investors to create the awareness about Equity shares Create more awareness about Motilal Oswal Securities Ltd in Davangere by appointing new marketing persons. Motilal Oswal Securities Ltd should conduct awareness program aggressively for its Stock Brokering services. Since the internet and web based communication is getting popular Motilal Oswal Securities Ltd should update web site frequently and provide information up to date . Since investors, investment decision is based on study of different sources of information. Motilal Oswal Securities Ltd should start giving advertisement in business newspaper and in business magazine.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

LIMITATIONS The study covers Davangere city only. People not having deep knowledge about equity shares. There is possibility of results not being accurate due to the small size of the sample. The respondents may have answered in a hurry without giving adequate consideration especially due to lack of time. The time constraint was a limiting factor as more in-depth analysis of the subject as well as the responses could not be carried out.

Some of the responses may be biased, as the Investors were very careful in choosing their
responses.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Conclusions:
Out of 100 respondents 38% investors are business people & 35% of the age group 30-50 years. Most of the investors invested in equity shares because of future security & regular returns & their satisfaction level in equities good. Most of the investors pick the stocks based on future prospects of the company. Out of 100 respondents 70 investors go for medium shares because they dont want to take risk .& most of existing share holders first prefer dividend shares next bonus shares last they prefer right shares. Because a bonus issue (or scrip issue) is a stock split in which a company issues new shares without charge in order to bring its issued capital in line with its employed capital (the increased capital available to the company after profits). This usually happens after a company has made profits, thus increasing its employed capital. Therefore, a bonus issue can be seen as an alternative to dividends. No new funds are raised with a bonus issue. The whole idea behind the issue of Bonus shares is to bring the Nominal Share Capital into line with the true excess of assets over liabilities. Last they prefer right shares because if investor invests in dividend shares then only they will get right shares. Investors getting good returns in investing equities therefore investors satisfaction level in equities is good. Overall satisfaction of the investors in equity shares is good.

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

Dear Sir/Madam,

I am Ms. Kavita.M.Mellalli student of Bapuji Academy Of Management & Research Davangere, pursuing MBA degree have undertaken a project on A Study On Investors Perception Towards Equity Shares in Davangere city as part of curriculum, so I kindly Request you to fill the following questionnaire and provide your sincere views. I ensure that it would used only for academic purpose. Thanking you

Name: _____________________________________

Age Group: 20-30Yrs

30-50 yrs

50-60 yrs

above 60yrs

Occupation: ____________________________________________________________

Annual Income: Below 1lakh 3-5lakh

1-3lakh Above 5lakh

1) In which sector you would like to invest? a) Infrastructure/cement c) FMCG b) Power d) Pharma/biotech

e) Others_____________________

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

2) What is the percentage allocation of your savings among the following investment avenues? a) Bonds/debentures c) Insurance/ULIPS e) Real estate g) Bank FD/PO b) Gold d) Shares f) MF

h) Others _____

3) How often you trade in equities? a) Daily b) Twice in a week d) Rarely

c) Once in month

4) I pick the stocks based on these factors a) Past returns b) Future prospectus of the company d) Based on the M capitalization

c) Management of the company

5) Which type of shares would you prefer? a) Defensive c) Medium b) Aggressive

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

6) Objective of your investment is: a) Future security c) Tax benefits b) Regular returns d) Asset accumulation.

7) What is your strategy for investment post global equity markets meltdown (2008)? a) Investing more in equities c) Investing less in equities b) No Change in the investment pattern d) No comments

8) Usually at what percent you book your profits? a) Less than 10% c) 20-30% b) 10-15% d) above 30%

9) How often you revise your portfolio? a) Less than 1 year c) 3-6 yrs b) 1-3 yrs d) 6yrs & above

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

10) Are you satisfied with your investment decision? 1. Very satisfied 4. Dissatisfied 5. Very dissatisfied 2. Satisfied 3 Neutral

11) What convenience you see with your share broker? a) Ease of A/c Opening c) Less Brokerage e) Good service g) Honesty b) Exposure given d) Near to my home/Office f) Good tips given

12) Prioritize your interest among the following about equity shares corporate actions: 1 is highest 3 is lowest. 1. Dividend 2. Bonus 3. Rights

MOTILAL OSWAL SECURITIES LTD, DAVANGERE.

BIBLIOGRAPHY

WEBSITES
www.nseindia.com accessed on 03/02/2010 www.bseindia.com accessed on 27/2/2010 www.amfi.com accessed on 3/3/2010 www.moneycontrol.com accessed on 1/4/2010 www. motilaloswal.com accessed from 27/2/2010 to 15/3/2010 www.investopedia.com accessed on 11/3/2010

BOOK Security Analysis and Portfolio Management Author : Punithavathy Pandian