Nagendra India Infoline Project Report

A PROJECT REPORT ON
COMPARATIVE ANALYSIS OF
INVESTMENT IN EQUITY AND
MUTUAL FUND SCHEMES.
With Reference to
SUBMITTED IN PARTIAL FULFILMENT OF

REQUIREMENT OF PGDM PROGRAME
(2009 – 2011)
ACHARY INSTITUTE OF MANAGEMENT AND

SCIENCES.
BANGALORE
SUBMITTED TO:- SUBMITTED BY:-
ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 1

Mr. Rakesh Sahu NAGENDRA KUMAR
DECLARATION
We, hereby, declare that the PGDM Project titled, “COMPARATIVE
ANALYSIS OF INVESTMENT IN EQUITY AND MUTUAL FUND
SCHEMES WITH REFERENCE TO INDIAINFOLINE” plans is original
to the best of our knowledge and have not been published elsewhere. This is for
the purpose of partial fulfillment of the requirement for the degree of Post
Graduate Diploma in Management (PGDM).
Place: - Bangalore
NAGENDRA KUMAR
Date: -………………………….. Sign:-

……………………………

ACKNOWLEDGEMENT
Any purpose and its fulfillment require deep routed efforts for its completion.
Many characters play a vital role. This is more when a project undertaken is
directly to a cause.
Our sincere thanks to Prof. Dr. KIRAN REDDY, PRINCIPAL AND

CEO OF AIMS for giving this opportunity to me.
We would like to thank Prof.RAKESH SUD, our Project guide, not only
for giving us the opportunity to work on this project, but also for providing us
with sound guidance and the necessary facilities to carry out the project. He
constantly insisted and helped us in learning new things. He provided us a lot of
learning opportunities.
Finally I would like to thank all those who were directly and indirectly
concerned in making my project successful. To put it in a nutshell a difficult
and arduous journey was made simple and quiet enjoyable due to their support.

NAGENDRA
KUMAR
PREFACE
PGDM program is one of the most reputed professional courses in the field of
Management. Training is an integral part of PGDM (MBA). As a
complementary to that every trainee has to submit a report on the research work
conducted in that institute.
This report is thus prepared for the project work done at Indiainfoline
Rajajinagar branch. The topic of the project is, “Comparative analysis of
investment in equity and mutual fund schemes with reference to IndiaInfoline”.
Investment means putting your money to work to earn more money. If done
wisely it can help to meet one's financial goals like buying a new house, paying

for a college education, education, enjoying a comfortable retirement or
whatever is important to an individual.
One needs to make decisions about how much he/she wants to invest and where
to invest. To choose he needs to know current good options available and their
relative risk exposures. These help are given to a client in Indiainfoline as to in
which portfolio they can invest and what risks are related to it. They manage all
the respected returns of their clients and timely inform them for the switching to
be done between funds in cases of expected downfall in returns of their Mutual
Funds in future.
INDEX
NO PARTICULAR
1 INDUSTRY PROFILE
✔ FINANCIAL MARKETS
2 COMPANY PROFILE
✔ INTRODUCTION TO INDIA INFOLINE
✔ HISTORY OF INDAIINFOLINE
✔ VISION
✔ MISSION
✔ COMPANY’S PHILOSHOPY
✔ COMMITTEE
✔ COMPANY STRUCTURE

✔ PRODUCT & SERVICE
✔ MILESTONES ACHIVED
✔ MARKET SHARE OF COMPANY
✔ CHALLENGE FACED BY INDIAINFOLINE
✔ MARKETING STRATGY OF INDIAINFOLINE
✔ HUMAN RESOURCES
3 RESEARCH METHODOLOGY
✔ OBJECTIVE OF STUDY
✔ DATA COLLECTION
✔ FUNDAMENTAL RESEARCH SERVICE
✔ TECHNICAL RESEARCH SERVICE
✔ SWOT ANALYSIS
✔ PORTER’S FIVE FORCE MODEL
4 DATA ANALYSIS
✔ FINANCIAL PERFORMANCE
✔ P & L ACCOUNT OF INDIAINFOLINE
✔ BALANCE SHEET OF INDIAINFOLINE
✔ COMPITITORS
✔ COMPARATIVE ANALYSIS OF CHARGES &
FACILITIES PROVIDED BY DIFFERENT COMPANY
✔ PERFORMANCE HIGHLIGHT 2008-09
✔ HIGHLIGHTS ,2008-09 INDUSTRY OPTIMISM
5 FINDING
6 RECOMMENDATION
7 CONCLUSION
8 BIBLIOGRPHY
INDUSTRY PROFILE

INDUSTRY PROFILE
The Indian broking industry is one of the oldest trading

industries that have been around even before the
establishment of the BSE in 1875. Despite passing through

number of changes in the post liberalization period, the
industry has found its way onwards sustainable growth. With
the purpose of gaining a deeper understanding about the role
of the Indian stock broking industry in the country’s economy,
we present in this section some of the industry insights
gleaned from analysis of data received through primary
research.
For the broking industry, we started with an initial

database of over 1,800 broking firms that were contacted,
from which 464 responses were received. The list was further
short listed based on the number of terminals and the top 210
were selected for profiling. 394 responses, that provided more
than 85% of the information sought have been included for
this analysis presented here as insights. All the data for the
study was collected through responses received directly from
the broking firms. The insights have been arrived at through
an analysis on various parameters, pertinent to the equity
broking industry, such as region, terminal, market, branches,
sub brokers, products and growth areas.
Some key characteristics of the sample 394 firms are:
• On the basis of geographical concentration, the West

region has the maximum representation of 52%. Around
24% firms are located in the North, 13% in the South and
10% in the East

• 3% firms started broking operations before 1950, 65%
between 1950-1995 and 32% post 1995.
• On the basis of terminals, 40% are located at Mumbai,

12% in Delhi, 8% in Ahmedabad, 7% in Kolkata, 4% in
Chennai and 29% are from other cities
• From this study, we find that almost 36% firms trade in

cash and derivatives and 27% are into cash markets
alone. Around 20% trade in cash, derivatives and
commodities
• In the cash market, around 34% firms trade at NSE, 14%

at BSE and 52% trade at both exchanges. In the derivative
segment, 48% trade at NSE, 7% at BSE and 45% at both,
whereas in the debt market, 31% trade at NSE, 26% at
BSE and 43% at both exchanges
• Majority of branches are located in the North, i.e. around

40%. West has 31%, 24% are located in South and 5% in
East
• In terms of sub-brokers, around 55% are located in the

South, 29% in West, 11% in North and 4% in East
• Trading, IPOs and Mutual Funds are the top three products
offered with 90% firms offering trading, 67% IPOs and
53% firms offering mutual fund transactions
• In terms of various areas of growth, 84% firms have

expressed interest in expanding their institutional clients,

66% firms intend to increase FII clients and 43% are
interested in setting up JV in India and abroad
• In terms of IT penetration, 62% firms have provided their

website and around 94% firms have email facility
A BRIEF HISTORY
India Infoline was originally incorporated on October 18,

1995 as Probity Research and Services Private Limited at
Mumbai under the Companies Act, 1956 with Registration No.
11 93797. India Infoline commenced operations as an
independent provider of information, analysis and research
covering Indian businesses, financial markets and economy, to
institutional customers. India Infoline became a public limited
company on April 28, 2000 and the name of the Company was
changed to Probity Research and Services Limited. The name of
the Company was changed to India Infoline.com Limited on May
23, 2000 and later to India Infoline Limited on March 23, 2001.

In 1999, India Infoline.com identified the potential of the
Internet to cater to a mass retail segment and transformed our
business model from providing information services to
institutional customers to retail customers. Hence India Infoline
launched Internet portal, www.indiainfoline.com in May 1999
and started providing news and market information,
independent research, interviews with business leaders and
other specialized features.
In May 2000, the name of India Infoline was changed to

India Infoline.com Limited to reflect the transformation of our
business. Over a period of time, India Infoline.com has emerged
as one of the leading business and financial information
services provider in India.
In the year 2000, India Infoline leveraged its position as

a provider of financial information and analysis by diversifying
into transactional services, primarily for online trading in shares
and securities and online as well as offline distribution of
personal financial products, like mutual funds and RBI Bonds.

These activities were carried on by our wholly owned
subsidiaries.
India Infoline broking services was launched under the

brand name of 5paisa.com through our subsidiary, India
Infoline Securities Private Limited and www.5paisa.com, the e-
broking portal, was launched for online trading in July 2000. It
combined competitive brokerage rates and research, supported
by Internet technology besides investment advice from an
experienced team of research analysts, India Infoline also offer
real time stock quotes, market news and price charts with
multiple tools for technical analysis.
Facilities
India Infoline’s main offices are located in approximately

4,000 square feet of office space located in Mumbai, India.
India Infoline Branches collectively occupy an additional 10,000
square feet of office space located throughout India, As on
March 31, 2005, India Infoline has 73 branches across 36
locations in India.
Terminals

Almost 52% of the terminals in the sample are based in
the Western region of India, followed by 25% in the North, 13%
in the South and 10% in the East. Mumbai has got the
maximum representation from the West, Chennai from the
South, New Delhi from the North and Kolkata from the East.
Branches & Sub-Brokers
The maximum concentration of branches is in the North,

with as many as 40% of all branches located there, followed by
the Western region, with 31% branches. Around 24% branches
are located in the South and East constitutes for 5% of the
total branches of the total sample.
In case of sub-brokers, almost 55% of them are based in

the South. West and North follow, with 30% and 11% sub-
brokers respectively, whereas East has around 4% of total sub-
brokers.

Financial Markets
The financial markets have been classified as cash

market, derivatives market, debt market and commodities
market. Cash market, also known as spot market, is the most
sought after amongst investors. Majority of the sample broking
firms are dealing in the cash market, followed by derivative
and commodities. 27% firms are dealing only in the cash
market, whereas 35% are into cash and derivatives. Almost
20% firms trade in cash, derivatives and commodities market.
Firms that are into cash, derivatives and debt are 7%. On the
other hand, firms into cash and commodities are 3%, cash &
debt market and commodities alone are 2%. 4% firms trade in
all the markets.

In the cash market, around 34% firms trade at NSE, 14%
at BSE and 52% trade at both exchanges. In the equity
derivative market, 48% of the sampled broking houses are
members of NSE and 7% trade at BSE, while 45% of the
sample operate in both stock exchanges. Around 43% of the
broking houses operating in the debt market, trade at both
exchanges with 31% and 26% firms uniquely at NSE and BSE
respectively.

Products
The survey also revealed that in the past couple of years,

apart from trading, the firms have started offering various
investment related value added services. The sustained
growth of the economy in the past couple of years has resulted
in broking firms offering many diversified services related to
IPOs, mutual funds, company research etc. However, the core

trading activity is still the predominant form of business,
forming 90% of the firms in the sample. 67% firms are
engaged in offering IPO related services. The broking industry
seems to have capitalized on the growth of the mutual fund
industry, which was pegged at 40% in 2006. More than 50% of
the sample broking houses deal in mutual fund investment
services. The average growth in assets under management in
the last two years is almost 48%. Company research is another
lucrative area where the broking firms offer their services;
more than 33% of the firms are engaged in providing company
research services. Additionally, a host of other value added
services such as fundamental and technical analysis,
investment banking, arbitrage etc are offered by the firms at
different levels.

Of the total sample of broking houses providing trading
services, 52% are based in the West, followed by 25% from
North, 13% from South and 10% from the East. Around 50% of
the firms offering IPO related services are based in the West as
compared to 27% in North, 13% in South and 10% in East. In
providing mutual funds services, the Western region was
dominant amounting to 49% followed by 27% from North; The
South and the East are almost at par with 13% and 11%
respectively.

Future Plans
68% of the firms from the sample have envisaged

strategies for future growth. With the middle class Indian
investor as well as foreign investor willing to invest in the stock
market, majority of the firms preferred expansion of
institutional and the Foreign Institutional Investor clients in
their areas of growth. Around 84% have shown interest in
expanding their institutional client base. Nearly 51% of such
firms are located in the West, 25% in North, 15% are from
South and 9% from East. Since the past couple of years, India,
along with Korea and Taiwan, has been one of the preferred
destinations for the FIIs. With corporate restructuring, rising
market capitalization and sectoral friendly policies helping the
FIIs, more than two thirds of the firms are interested in
increasing their FII client base. Amongst these firms, west
again has maximum representation of 53%, followed by North
with 22%. South has 15% firms and East makes up for 9%.

INTRODUCTION TO INDIAINFOLINE
IndiaInfoline founded in 1995 by Mr. Nirmal Jain (Chairman and Managing Director) as an
independent business research and information provider. We gradually evolved into a one-
stop financial services solutions provider. Our strong management team comprises competent
and dedicated professionals.

We are a pan-India financial services organization across 1,361 business locations and a
presence in 428 cities. Our global footprint extends across geographies with offices in New
York, Singapore and Dubai. We are listed on the Bombay Stock Exchange (BSE) and the
National Stock Exchange (NSE).
We offer a wide range of services and products comprising broking (retail and institutional
equities and commodities), wealth management, credit and finance, insurance, asset
management and investment banking.
We are registered with the BSE and the NSE for securities trading, MCX, NCDEX and
DGCX for commodities trading, CDSL and NSDL as depository participants. We are
registered as a Category I merchant banker and are a SEBI registered portfolio manager. We
also received the FII license in IIFL Inc. IIFL Securities Pte Ltd received approval from the
Monetary Authority of Singapore to carry out corporate advisory and dealing in securities
operations. Two subsidiaries – India Infoline Investment Services and Moneyline Credit
Limited – are registered with RBI as non-deposit taking non-banking financial services
companies. India infoline Housing Finance Ltd, the housing finance arm, is registered with
the National Housing Bank.
HISTROY OF INDIAINFOLINE
The IndiaInfoline Group was originally incorporated on October 18, 1995 as Probity
Research and Services Private Limited at Mumbai under the Companies Act, 1956 with
Registration No. 11 93797. The IndiaInfoline Group commenced its operations as an
independent provider of information, analysis and research covering Indian businesses,
financial markets and economy, to institutional customers. We became a public limited
company on April 28, 2000 and the name of the Company was changed to Probity Research
and Services Limited. The name of the Company was changed to India Infoline.com Limited
on May 23, 2000 and later to India Infoline Limited on March 23, 2001.
In 1999, The IndiaInfoline Group identified the potential of the Internet to cater to a
mass retail segment and transformed our business model from providing information services
to institutional customers to retail customers. Hence we launched our Internet portal,
www.indiainfoline.com in May 1999 and started providing news and market information,
independent research, interviews with business leaders and other specialized features.
In May 2000, the name of our Company was changed to India Infoline.com Limited
to reflect the transformation of our business. Over a period of time, we have emerged as one
of the leading business and financial information services provider in India.
In the year 2000, The India Infoline Group leveraged it’s position as a provider of
financial information and analysis by diversifying into transactional services, primarily for
online trading in shares and securities and online as well as offline distribution of personal
financial products, like mutual funds and RBI Bonds. These activities were carried on by our
wholly owned subsidiaries.
The India Infoline Group’s broking services was launched under the brand name of
5paisa.com through our subsidiary, India Infoline Securities Private Limited and
www.5paisa.com, the e-broking portal, was launched for online trading in July 2000. It
combined competitive brokerage rates and research, supported by Internet technology
Besides investment advice from an experienced team of research analysts, we also offer real
time stock quotes, market news and price charts with multiple tools for technical analysis.

Acquisition of Agri Marketing Services Limited ("Agri")
In March 2000, The IndiaInfoline Group acquired 100% of the equity shares of Agri
Marketing Services Limited, from their owners in exchange for the issuance of 508,482 of
our equity shares. Agri was a direct selling agent of personal financial products including
mutual funds, fixed deposits, corporate bonds and post-office instruments. At the time of our
acquisition, Agri operated 32 branches in South and West India serving more than 30,000
customers with a staff of, approximately 180 employees. After the acquisition, we changed
the company name to India Infoline.com Distribution Company Limited.
The India Infoline group, comprising the holding company, India Infoline Ltd (NSE:
INDIAINFO, BSE: 532636) and it’s subsidiaries, is one of the leading players in the Indian
financial services space. India Infoline offers the entire gamut of financial services covering
investment products ranging from Equities and derivatives, Commodities, Portfolio
Management Services, Mutual Funds, Life Insurance, Fixed deposits, Loans, Investment
Banking, GoI bonds and other small savings instruments. It owns and manages the website,
www.indiinfoline.com, which is one of India’s leading online destinations for personal
finance, stock markets, economy and business.
A forerunner in the field of equity research, IndiaInfoline’s research is acknowledged by

none other than Forbes as ‘Best of the Web’ and ‘…a must read for investors in Asia’.
IndiaInfoline’s research is available not just over the internet but also on international wire

services like Bloomberg (Code: IILL), Thomson First Call and Internet Securities where it is
amongst the most read Indian brokers.
A network of 753 business locations spread over 346 cities across India, facilitates the
smooth acquisition and servicing of a large customer base. All these offices are connected
with the corporate office in Mumbai with cutting edge networking technology.
The group caters to a customer base of over 500,000 over a variety of mediums viz. online,
over the phone and at our branches. The Group is strengthening its institutional broking and
investment banking services and has built a team of experienced research analysts, sales and
trading professionals.
IndiaInfoline refers to IndiaInfoline Ltd and its subsidiaries. The consolidated figures will
give a more meaningful picture of the Company to the investors. Reference to the company
or IndiaInfoline is to the business done by the company and its subsidiaries, unless otherwise
specified.
VISION
Our vision is to be the most respected company in the financial services space.
MISSION
“To become a full-fledged financial services company known for its quality of advice,
personalized services and cutting edge technology”
COMPANY PHILISOPHY
The IndiaInfoline Group is committed to placing the Investor First, by continuously striving
to increase the efficiency of the operations as well as the systems and processes for use of

corporate resources in such a way so as to maximize the value to the stakeholders. The Group
aims at achieving not only the highest possible standards of legal and regulatory compliances,
but also of effective management.
COMMITTEE
Audit Committee
Terms of reference & Composition, Name of members and Chairman: The Audit committee
comprises Mr Nilesh Vikamsey, Chairman of the Committee, Mr Sat Pal Khattar, Mr Sanjiv
Ahuja and Mr Kranti Sinha, three of whom are independent Directors. The top Executivess and
Internal Auditors are invitees to the Meeting. The Terms of reference of this committee are as
under: - To investigate into any matter that may be prescribed under the provisions of Section
292A of The Companies Act, 1956 - Recommendation and removal of External Auditor and
fixation of the Audit Fees. - Reviewing with the management the financial statements before
submission of the same to the Board. - Overseeing of Company’s financial reporting process and
disclosure of its financial information. - Reviewing the Adequacy of the Internal Audit Function.
Compensation/ Remuneration Committee

Terms of reference & Composition, Name of members and Chairman: The Compensation /
Remuneration Committee comprises Mr Sanjiv Ahuja, Chairman of the Committee, Mr
Nilesh Vikamsey and Mr Kranti Sinha, all of whom are independent Directors. The Terms of
reference of this committee are as under: - To fix suitable remuneration package of all the
Executive Directors and Non Executive Directors, Senior Employees and officers i.e. Salary,
perquisites, bonuses, stock options, pensions etc. - Determination of the fixed component and
performance linked incentives alongwith the performance criteria to all employees of the
company - Service Contracts, Notice Period, Severance Fees of Directors and employees. -
Stock Option details: whether to be issued at discount as well as the period over which to be
accrued and over which exercisable. - To conduct discussions with the HR department and
form suitable remuneration policies.

Share Transfer and Investor Grievance Committee
Details of the Members, Compliance Officer, No of Complaints received and pending and
pending transfers as on close of the financial year. The committee functions under the
Chairmanship of Mr Kranti Sinha, a Non-executive independent Director. The other
Members of the committee are Mr Sanjiv Ahuja, Independent Director and Mr R
Venkataraman, Executive Director. Ms Komal Parikh, Company Secretary is the Compliance
Officer of the Company.
COMPANY STRUCTURE
IndiaInfoline Limited is listed on both the leading stock exchanges in India, viz. the Stock
Exchange, Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of
both the exchanges. It is engaged in the businesses of Equities broking, Wealth Advisory
Services and Portfolio Management Services. It offers broking services in the Cash and
Derivatives segments of the NSE as well as the Cash segment of the BSE. It is registered
with NSDL as well as CDSL as a depository participant, providing a one-stop solution for
clients trading in the equities market. It has recently launched its Investment banking and
Institutional Broking business.

A SEBI authorized Portfolio Manager; it offers Portfolio Management Services to clients.
These services are offered to clients as different schemes, which are based on differing
investment strategies made to reflect the varied risk-return preferences of clients
PRODUCT & SERVICES

Equities
India Infoline provided the prospect of researched investing to its clients, which was
hitherto restricted only to the institutions. Research for the retail investor did not exist
prior to India Infoline. India Infoline leveraged technology to bring the convenience of
trading to the investor’s location of preference (residence or office) through

computerized access. India Infoline made it possible for clients to view transaction
costs and ledger updates in real time.
Over the last five years, India Infoline sharpened its competitive edge through the
following initiatives:
Multi-channel delivery model :
The Company is among the few financial intermediaries in India to offer a complement
of online and offline broking. The Companies network of branches also allows
customers to place orders on phone or visit our branches for trading.
Integrated middle and back office :

The customer can trade on the BSE and NSE, in the cash as well as the derivatives
segment all through the available multiple options of Internet, phone or branch
presence.
Multiple-trading options :
The Company harnessed technology to offer services at among the lowest rates in the
business.
Membership:
The Company widened client reach in trading on the domestic and international
exchanges.
Technology :
The Company provides a prudent mix of proprietary and outsourced technologies,
which facilitate business growth without a corresponding increase in costs.
Content :
The Company has leveraged its research capability to provide regular updates and
investment picks across the short and long-term.

Service :
Clients can access the customer service team through various media like toll-free lines,
emails and Internet- messenger chat for instant query resolution. The Companies
customer service executives proactively contact customers to inform them of key
changes and initiatives taken by the Company. Business World rated the Companies
customer service as Best in their survey of online trading sites carried out in December
2003.
Key features :
Membership on the Bombay Stock Exchange Limited and the National Stock Exchange
Registered with the NSDL as well as CDSL as a depository participant, providing a

one-stop solution for clients trading in the equities market
Broking services in cash and derivative segments, online as well as offline.

Presence across 350 cities and towns with a network of over 850 business locations
Equity client base of over 500,000 clients
Provision of free and world-class research to all clients
Commodities
India Infolines extension into commodities trading reconciles its strategic intent to
emerge as a one stop solutions financial intermediary. Its experience in securities
broking has empowered it with requisite skills and technologies. Increased offering:
The Companies commodities business provides a contra-cyclical alternative to equities
broking. The Company was among the first to offer the facility of commodities trading
in Indias young commodities market (the MCX commenced operations only in 2003).
Average monthly turnover on the commodity exchanges increased from Rs 0.34 bn to
Rs 20.02 bn. The commodities market has several products with different and non-
correlated cycles. On the whole, the business is fairly insulated against cyclical
gyrations in the business.
IndiaInfoline distinguished its business through the interplay of knowledge and

technology:
Complete solution :
The Company provides a complete - advice to execution solution facilitated by
information and advice on likely commodity trends in the Indian and international
environment.
Technology :
The Company has extended the trading terminal to the investors home/workplace
reinforced with real-time commodity information and ledger position.
Rates :
The Company harnessed technology to offer services at among the lowest rates in the
business. Membership: The Company widened client reach in trading on the domestic
and international exchanges.
Key Features :
Enjoys memberships with the MCX and NCDEX, two leading Indian commodities
exchanges
Recently acquired membership of the DGCX
Multi-channel delivery model, making it among the select few to offer online as well as
offline trading facilities
Extended commodity trading to retail investors, among the few Indian financial
intermediaries to do so
Online business at 80% of revenues dominates commodities trading revenues

Provides regular commodity updates pertaining to the Indian and international
environment
INSURANCE
An entry into this segment helped complete the client's product basket; concurrently, it
graduated the Company into a one stop retail financial solutions provider. To ensure
maximum reach to customers across India, we have employed a multi pronged approach and
reach out to customers via our Network, Direct and Affiliate channels. Following the

opening of the sector in 1999-2000, a number of private sector insurance service providers
commenced operations aggressively and helped grow the market.
The Companies entry into the insurance sector derisked the Company from a predominant
dependence on broking and equity-linked revenues. The annuity based income generated
from insurance intermediation result in solid core revenues across the tenure of the policy.
Over the last five years, India Infoline sharpened its competitive edge in this business
segment through the following initiatives:
Client base :
Grew its 40,000 strong client base through knowledge-led analysis, translating into an
attractive opportunity to cross-sell products and generate referral business.
Distribution network :
Invested in a distribution network of 177 branches across 19 states, which provided it with
an unmatched reach within its segment.
Hands-on training :
Invested aggressively in training its field force more than 100 hours a year in product
attributes across the insurance sector - highlighting various product details and marketing
skills apart from regular meets where best practices are shared.
Technology :
The Company provides a prudent mix of proprietary and outsourced technologies, which
facilitate business growth without a corresponding increase in costs.
Research and advice :

Provided clients with advice on diverse investment products based on the customers existing
and prospective financial profile.

Key features :
India Infoline was the first corporate in India to get the agency licence in early 2001
The Company is the biggest corporate agency in India for life insurance products
The Company operates multiple channels, namely branch network, preferred client
group, direct marketing, corporate tax advisory, walk-ins and seminars, to reach out to
customers.
INVEST ONLINE
India Infoline has made investing in Mutual funds and primary market so
effortless. All you have to do is register with us and that’s all. No paperwork no
queues and No registration charges.
If you are 5p customer use your existing login ID and Ledger (fund transfer) password.
Indiainfoline offers you a host of mutual fund and IPO choices under one roof; backed by
in-depth information and research to help you invest effortlessly.
INVEST IN MF
Indiainfoline offers you a host of mutual fund choices under one roof, backed by in-depth
research and advice from research house and tools configured as investor friendly.
Investing in Mutual Funds has never been easier
APPLY IN IPOs
You could also invest in Initial Public Offers (IPOs) online without going through the
hassles of filling ANY application form/ paperwork.

Know more about IPO
Get in-depth analyses of new IPOs issues (Initial Public Offerings) which are
about to hit the market and analysis on these recent IPO listings,
prospectus/offer documents, and IPO reports are few of the features, which help
you, keep on top of the IPO markets.
Loans
They say you mustn't trust a man till you know his house. Everyone likes hearing people
say Wow, what a beautiful house you have! From cave dwelling, we have evolved and now
a house provides far more than just shelter...it also becomes a source of pride. A Housing
Loan is used as finance to help you buy or modify that perfect home.
The different Housing Loan products can be classified as:

 Home Loans & Home Extension Loans
 NRI Loans
 Land Loans
 Home Equity Loans
• What is a housing loan? • Repayment capacity

• Who can apply? • Credit documentation
• General Terms and conditions • Legal documentation
of a Housing Loan product. • Tax Benefits
• Charges applicable to housing • Property Insurance
loan products.
What is a housing loan?

They say you mustn't trust a man till you know his house. Everyone likes hearing people
say "Wow, what a beautiful house you have!" From cave dwelling, we have evolved and

now a house provides far more than just shelter...it also becomes a source of pride. A
Housing Loan is used as finance to help you buy or modify that perfect home. The different
Housing Loan products can be classified as:
Home Loan
Home Extension Loans
Home Improvement Loans
Land Loans
NRI Loans
Home Equity Loans
Short term Bridging Loans
Balance Transfer
Who can apply?

As long as you want to buy a house in India, you can apply for a Home Loan. You could be
a Resident Indian or an NRI; you could want to buy a property now or in the future, but you
may still apply for a Home Loan. In case you go with the last option and want to wait before
you consider nests, all you have to be sure of is the amount you are willing to spend on this
property and the HfIs will let you know your eligibility based on your income which will
help you plan out your budget. To find out your eligibility, please use our calculator.
General Terms and Conditions of a Housing Loan Product

You are allowed to visit zoos on the condition that you do not feed the animals. When

you're 18, you are allowed to go for that late night party on the condition that someone
drops you home before 12. Every step we take requires condition to be fulfilled. Similarly,
these are the general terms & conditions of a Home Loan. For more details, please refer to
the individual product.
• LTV Ratio will not exceed a particular percentage. This percentage differs from HFI
to HFI and the components of the value of property are covered in Cost of Property
• Elastic can be stretched only to a certain extent. The loan tenure also will not go
beyond 20 years. However, HFIs do provide for different tenures with different
terms and conditions.
• Your EMI normally does not exceed 50% of your Gross Monthly income.
• The total monthly payment towards all the loans you have availed of, including the
present one, will normally not exceed 50% of your Gross Monthly Income.
• Your loan eligibility is calculated using LTV, IIR and FOIR norms and the lowest
from the three is chosen.
• Your profile is considered by the HFI before your repayment capacity is judged.
• If the HFI insists on a personal guarantor, you need to provide one before the
disbursement of your loan.
• Your property should be both technically and legally clear before your loan can get
disbursed by the HFI.
• In case you have bought an under construction property, your loan will be partly
disbursed, as per the stages of construction and PEMI needs to be paid on it.
• The disbursement, in most cases, will be in the name of the builder or the seller or
the society or the development authority unless you have made some payment to
them.
• Repayment of the loan is either via Deduction Against Salary, Post Dated Cheques,
standing instructions or by cash / DD.
• You can either choose to repay the loan using the Annual rests or Monthly rests.

Charges applicable to Housing Loans
The different kinds of charges applicable to Home Loans are listed below:
• Upfront Fees
• Rate of Interest
• Legal and Technical Charges
• Stamp Duty and Registration Charges
• Personal Guarantee from Charges
• Cheque Bounce Charges
• Delayed Payment Charges
• Additional Charges
• Incidental Charges
• Prepayment Charges
• PDC Swapping Charges
Legal and technical charges :

Some HFIs charge you for the legal and technical checks undertaken on your documents
and property, by lawyers and the technical team of the HFI.
Stamp duty and registration charges:

If you go in for a registered mortgage, these charges incurred by the HFI are passed onto
you. Sometimes these charges are rather heavy depending on the State laws in the state from
where you purchase your property.
Personal Guarantee form charges:

A piece of paper signed does not have much value unless stamped and validated by the
concerned authority. That power of attorney document that you signed with your spouse

would not be credible unless signed on a Rs.100 stamp paper. Similarly, HFIs currently
charge you a minimum of Rs.100 to get the personal guarantee validated and stamped in the
eyes of the law.
PDC swapping charges:

In case you want to exchange the PDCs you gave the HFIs for EMI repayments because of
a change in bank accounts, a change in EMI amount, etc., the HFis might charge a flat fee
for it.
Repayment capacity
Your repayment capacity is judged according to your income and your income is considered
differently if you are salaried and differently if you are self-employed. Income is used to
calculate the amount of money that you will be able to shell out every month towards your
loan installment using IIR and FOIR norms. FOIR calculation also takes into account the
installments of loans you are currently repaying. The lower between the IIR and FOIR is
chosen as your maximum repayment capacity. This is then compared to the loan amount
that you have requested for and the loan eligibility as per LTV norms and the lowest of
these would be your final loan eligibility.
Salaried Self-employed
Any extra income on your salary slip Any non-recurring income that affects profit
(including overtime, etc.) is subtracted (like sale of asset) is subtracted.
50% of the average variable income over the Any non-recurring expense that adversely
last 6 months is added affects profits and was not capitalized (like
repairs and maintenance) is added
Any fixed cash or voucher payment that can 50% of the average depreciation of the last
be proved is added. two years is added.
HRA that can be received and is not being
received is added.

50% of the average annual income of the last
two years is added.
Credit Documentation
Would you trust any Tom, Dick or Harry with any matter at all? We all require a certain
assurance from people before we trust them; some sort of guarantee that they are
trustworthy. For HFIs this guarantee rests in the form of tangible documents. Credit
documents are required by all HFIs but vary in kind based on your occupation, employer,
qualifications, experience, etc. Credit documents can be classified as
Income documents:
Money money money...no one can take a chance on the credibility of money matters
because at the end of the day, business is business. Almost everything about your loan is
based on your income and therefore proof regarding the same is required by the HFI to
ensure that no miscommunications occur.
Personal documents:
Previously, tribes and clans had passwords without which you could not enter into the
territory; as proof of who he was, King Solomon had a ring as identification. Throughout
history, proof of identity has been important as mistaken identity has never been
uncommon. To prevent any such shams, HFIs also require a set of documents, for a general
Home Loan Product, identifying who you are.
He following list out all the documents needed. {under this line will be placed the document
sent separately as an excel sheet}
Legal Documentation
We might be living in the electronic age but that doesn't take away the importance and
monopoly of paper as everything to do with law will always be on paper. To stick by this
unwritten rule, there are legal documents that need to be submitted by you to the HFI for
mortgaging and these differ from state to state and also depend on your property type. The

following form a broad outline of the documents required and a detailed list can be found
here.
• Copy of the offer letter sent by the HFI, accepted by you.
• Title documents of the property which include

-Duly registered sale agreement.
-Receipts of your own contribution.
-Allotment letter
-Registration receipt
-If needed, land documents indicating ownership.
-Possession letter
-Lease agreement, if the property is bought from a development authority
-Mortgage deed if the HFI opts for a registered mortgage.
• No Objection Certificate from the developer, society or development authority
• Personal Guarantees, if required.
• Documents for alternate or additional security.
• Post dated cheques for the EMIs.
These documents do NOT cover the entire list needed and if it is a resale property, the
pertaining agreements, etc. will also need to be attached.
Tax Benefits
Tax benefits are currently available only under Home Loans and Home Extension loans.
The details are given under the respective sections.
Property Insurance
Some events are not in our hands and are completely unavoidable. Floods, drought and
storms uproot trees and destroy the land. Along with this the birds lose their homes and

while building a nest may not be that bad and the loss is not that great, the money that you
invest in your cosy home might just be washed away. For this reason insuring your property
is a good idea as you safeguard the asset against damage or loss.. Property insurance is not
compulsory though some HFIs insist on a mortgage redemption life insurance policy and
you will therefore get a reduced interest rate. Some of the points that need to be noted
regarding property insurance are:
• You can choose the tenure of your insurance.
• The premium is charged up front
• The longer your tenure, the greater the discounts insurance companies offer you.
News Letter
The Daily Market Strategy is your morning dose on the health of the markets. Five
intra-day ideas, unless the markets are really choppy coupled with a brief on the global
markets and any other cues, which could impact the market. Occasionally an
investment idea from the research team and a crisp round up of the previous day's top
stories. That's not all. As a subscriber to the Daily Market Strategy, you even get
research reports of India Infoline research team on a priority basis.
The IndiaInfoline Weekly Newsletter is your flashback for the week gone by. A weekly
outlook coupled with the best of the web stories from India Infoline and links to
important investment ideas, Leader Speak and features is delivered in your inbox every
Friday evening.
Portfolio Management

You get recessions. You have stock market declines. If you don't understand that's going
to happen, then you're not ready; you won't do well in the markets. No need to worry.
We at India Infoline would take care of all issues related to managing your hard earned
money.
Our Portfolio Management Service is a product wherein an equity investment portfolio is

created to suit the investment objectives of a client. We at India Infoline invest your
resources into stocks from different sectors, depending on your risk-return profile. This
service is particularly advisable for investors who cannot afford to give time or don't
have that expertise for day-to-day management of their equity portfolio.
It is all about your money, being managed by the experts, while you continue with your
routine life. Isn't it simple and totally hassle free.
What's more, you can keep track of your dividends / bonus / rights issues with paperless
tracking. So you always know how fast your investment is growing. It basically means
assigning the right job to the right person.
Research
IIFL special research cell where some of India's finest financial analysts bring you
intensive research reports on how the stock market is faring, when is the right
time to invest, when to execute your order and more.
IIFL make sure that investors are always prepared to make own investment decision
when the opportunity arises.
IIFL bring you intensive research reports - whether sectoral or company-wise or more -
that tell you exactly when and where to invest. So whenever there is an exciting
investment opportunity, you are in the know and always ready to invest. Research
reports IIFL will help you choose your investments wisely, without wasting time.
Presented in a lucid and easy-to-understand format; these reports help you make
informed decisions.

ASSET MANAGEMENT
India Infoline is a leading pan-India mutual fund distribution house associated with
leading asset management companies. It operates primarily in the retail segment
leveraging its existing distribution network to reach prospective clients. It has received
the in-principle approval to set up a mutual fund.
The group recently commenced its offshore asset management business under the ‘IIFL
Capital’ brand. Also, IIFL Securities Pte Ltd received approval from the Monetary
Authority of Singapore to carry out global asset management operations. The Singapore
arm can now offer broking, asset management and investment banking services.
IIFL Inc received an FII license, thereby facilitating the investment of dedicated funds
in India.
With offices in New York, Singapore and Dubai, IIFL Capital aims to offer India-
focused equity products, fund management and advisory services for offshore and
domestic wealth management customers.

MILESTONES ACHIEVED
1995
Incorporated as an equity research and consulting firm with a client base that included
leading FIIs, banks, consulting firms and corporates.
1999
Restructured the business model to embrace the internet; launched
archives.indiainfoline.com mobilised capital from reputed private equity investors.
2000
Commenced the distribution of personal financial products; launched online equity
trading; entered life insurance distribution as a corporate agent. Acknowledged by Forbes
as ‘Best of the Web’ and ‘...must read for investors’.
2004
Acquired commodities broking license; launched Portfolio Management Service.
2005
Listed on the Indian stock markets.
2006
Acquired membership of DGCX; launched investment banking services.
2007
Launched a proprietary trading platform; inducted an institutional equities team; formed
a Singapore subsidiary; raised over USD 300 mn in the group; launched consumer
finance business under the ‘Moneyline’ brand.
2008
Launched wealth management services under the ‘IIFL Wealth’ brand; set up India
Infoline Private Equity fund; received the Insurance broking license from IRDA;
received the venture capital license; received inprinciple approval to sponsor a mutual
fund; received ‘Best broker- India’ award from FinanceAsia; ‘Most Improved
Brokerage- India’ award from Asiamoney.
2009

Received registration for a housing finance company from the National Housing Bank;
received ‘Fastest growing Equity Broking House - Large firms’ in India by Dun &
Bradstreet.

MARKET SHARES OF COMPANY
• Retail broking:
IndiaInfoline has around 3 lakh customers. It has a tie-up with Bank of Baroda
for e-broking.
• Institutional broking:
IndiaInfoline has roped in Bharat Parajia, director of sales at CLSA in
Singapore, H Nemkumar, CLSA's country head for India, Aniruddha Dange, CLSA's
head of research in India, and Vasudev Jagannath, CLSA's head of sales in India.
While Parajia will join as head of institutional sales at India Infoline, Dange will be
head of research and Nemkumar head of investment banking.
Each one of them is bringing in more than 10 years of experience with a

top institutional brokerage in Asia. The CLSA foursome will also pick up stakes in
India Infoline through the preferential allotment route. Their collective stake would
add up to around 15%. Parajia already holds a 2.88% stake in India Infoline. He will
subscribe to 25 lakh equity warrants at Rs 440 each.Nemkumar will pick up another
25 lakh, while Jagannath and Aniruddha Dange will subscribe to 20 lakh warrants
each. The preferential allotment includes the four men buying 90 lakh equity warrants
at a price of Rs 440 each, of which 10% will be paid up front as their sign-on bonus.
The remaining will be payable at the end of eighteen months when the warrants will
be convertible into shares.That is, all these guys will have to cough up about Rs 360
crore to convert their warrants into shares. Currently, the company's institutional
equities team has 35 people, including research analysts and dealers.
• Consumer Finance:

During the quarter, it managed a book size of Rs 25 crore and has suffered a loss of
Rs 5.5 crore. It expects to break even in 2-3 quarters. NIM of 6-8% on personal loans
and 3-4% on home refinancing. It is looking at a Rs 200 crore private-equity funding
for its consumer finance subsidiary. It intends to leverage its extensive branch
network to expand its consumer finance division to tier-II and tier-III cities in the
coming quarters. IndiaInfoline is going slow as it has just started this business with a
robust risk management system. The company has roped in experts from Citi
Financial and other banks.
Ticker: 532636
Exchanges: BOM
2009 Sales: 9,630,900,000
Major Financial
Industry:
Sub Securities
Industry: Brokerage
Country: INDIA
Employees: 14105

CHALLENGES FACES BY INDIAINFOLINE
Category related - the market is skewed primarily to the metros with Mumbai, Ahmedabad,
and New Delhi accounting for major bulk of the trading.
Competition related - due to high brand proliferation, the market from a consumer standpoint
has become “commoditized” given product parity in terms of offerings.
Brand related - challenge being to maintain high decibel and impactful communication on a
sustained basis.
Key executives
S.No Name Designation
1 Mr. Nirmal Jain Chairman and Managing director
2 Mr. A K Purwar Director
3 Mr. R Venkataraman Executive Director
4 Mr. Nilesh Vikamsey Independent Director
5 Mr. Kranti Sinha Independent Director
6 Mr. Sat Pal Khattar Non Executive Director

MARKETING STRATEGY OF INDIA
INFOLINE
Market Positioning:
Market positioning statements of India Infoline are “At India Infoline we give you
single window service” and “We also ensure your comfort”. So, India Infoline focus on the
consumers who prefer almost all investment activities at same place by providing number of
various financial services. At India Infoline a person can purchase or sell shares, debentures
etc. and at the same place also demat it. India Infoline also provides other investment option
to the same person at same place like Mutual Fund, Insurance, Fixed Deposit, and Bonds etc.
and help the person in designing his portfolio. By this way India Infoline provides comfort to
its customers.
Target Market:
India Infoline uses demographic segmentation strategy and segment people based on
their occupation. India Infoline uses selective specialization strategy for market targeting.
Target person for the India Infoline Stock Broking and India Infoline Investment Service are
persons who can work as sub-broker for the companies. Companies focus on Advisors of
Insurance and post office, Tax consultants and CAs for making sub-broker

Marketing channel System:
India Infoline uses one level marketing channel for investment product distribution.
Sub-brokers work as intermediary between consumer and company. Company has both
forward and backward flow of activity through channel. Company distributes stationery,
brokerage, and information forward to its sub-broker. The sub-brokers send filled forms,
queries, amount of investment etc. back to the company.
Training Channel Members:
India Infoline provides training to the sub-brokers because they will be viewed as the
company by the investors. The executives of India Infoline explain various new schemes of
investment to the sub-brokers with its objective, risk factors and expected return. Company
also periodically arrange seminar to guide sub-brokers.
Advertising and Promotion:
The objective of advertising of India Infoline is to create awareness about services of

India Infoline among investors and sub-brokers.
India Infoline also publishes its weekly Stock Market Newsletter ‘Market Mantra’.
HUMAN RESOURCES
The India Infoline Group’s Human Resources policy is based on the philosophy of “Owner
Mindset”. We believe that the key to our continued growth lies in unleashing the
entrepreneurial energy of our employees. We encourage all employees to behave more as
51owners of their departments rather than employees. Our people are highly driven and work
towards increasing India Infoline’s brand and market share across product lines.

We have developed extensive in-house training modules. In addition, our staff is trained by
various Asset Management Companies and ICICI Prudential Life Insurance Company
Limited. We lay emphasis on “on the job training” where an experienced and senior person
mentors a junior executive.
In addition to salary, our employees get performance-based incentives on a quarterly basis.
We have also implemented an Employee Stock Option Plan.
As on December 31, 2009, the total employee strength of our company and our subsidiaries
was 1200.

RESEARCH METHODOLOGY
i) Objective of the Study:
• To know percentage of people invest in mutual fund, insurance, equity and other
financial products and services.
• To know future prospects of their investment in the financial products and
services.
i) Data Collection:
Primary data:-
Primary data are data freshly gathered for a specific purpose. The various sources of
primary data for my project are as follows.
• Banks.
• Local residents.

• People from industries
• Mall
• Small Retailers
Secondary Data:-
Secondary data provide a starting point for research and offer the valuable source of
information.
The secondary data was the most important source for my project because it gave us
information about company profile, competitors, market scenario, market share, etc.
It also give us information of the financial industry, its emergence,& its importance in
country progress.
We used secondary data for following sources:
• Internet
• Indiainfoline brochure
FUNDAMENTAL RESEARCH SERVICES:
✔ The Sunday Weekly Report :

This weekly report is the ace of all reports. It offers a comprehensive market
overview and likely trends in the week ahead. It also presents few top picks based on
an in-depth analysis of technical and fundamental factors. It gives short term and
long term outlook on these scrip’s, their price targets and trading strategies. Another
unique feature of this report is that it provides an updated view of about 70 prominent
stocks on an ongoing basis.
✔ The Industry Watch :

This report provides an in-depth analysis of specific industries which are
likely to outperform others in the economy. It analyzes their strengths and
weaknesses and ascertains their future outlook. The final view is arrived at after

thorough interaction with industry experts. Also comparative performances of
various companies in the sector are evaluated and top picks are recommended.
✔ Stock Analysis :
Indiainfoline stock research has performed very well over the past few years
and the Indiainfoline Model Portfolio has consistently outperformed the benchmark
indices. The fundamentals of select scrips are thoroughly analyzed and an actionable
advice is provided along with investment rationale for each scrip.
✔ Flash News :
Key developments and significant news announcements that are likely to have
an impact on markets / scrips are flashed live on trading terminals. Flash news keeps
the market participants updated on an online basis and helps them to reshuffle on their
holdings.
TECHNICAL RESEARCH SERVICE
✔ Nifty Tracker :
Nifty Futures is the most traded instrument with highest volumes in F & O and
excellent liquidity. The team tracks the Nifty Future and generates calls based on
unique trading system which is a result of their focused research over the past few
years. The objective is to generate positive returns for traders who are looking for a
high risk / high reward product.
✔ Online Chart :
An online forum to help clients, specifically day traders in judging the
directions of the market and stocks which are in the limelight.

✔ Intraday Calls :
For day traders, indiainfoline provides intra-day calls with entry, exit and stop
loss levels during market hours. These calls are flashed on their terminals. Their
analysts continuously track the calls and provide recommendations according to the
market movements.
✔ Position Calls :
Indiainfoline “Position Trading Calls” are based on thorough analysis of the
price movement in select scrip’s. These calls are for a 10-15 day time span with stop
loss and target levels. These calls are flashed on their terminals during market hours.
✔ Derivative Strategies :
Their analysts take view on the Nifty and select stocks based on the
derivatives data and technical tools. Suitable “Derivative Strategies” are devised,
which are flashed on their terminals and published in their reports.
✔ Futures Calls :
A customized product for HNIs to help them trade with leveraged position;
wherein clients are advised on the stocks with entry, exit and stop loss level for short
term benefits. Over and above this, financial status of the calls is monitored at all
times.
OTHER ADVATAGES
Advancements in Internet and Internet-based trading have transformed the way firms
operate in the broking industry. We recognize that technology is an important tool for
broking operations.
We believe that online trading will gain market share due to significant advantages that it
offers
• It enables the customer to trade directly without any agent intervention
• It offers customers the convenience of trading from almost anywhere

• It enables rapid dissemination of information and at reduced costs
• It offers a responsive mechanism for reporting grievances, problems and bugs
The IndiaInfoline Group have invested in technology and ensured that we have an
optimum infrastructure to handle the load. Our current technology infrastructure comprises
several high ends Dell, HP, IBM servers running on Microsoft Operating System. Most of
these servers support online customers for trading activities and users for the
www.indiainfoline.com and www.5paisa.com websites.
The IndiaInfoline Group’s main trading servers (application and database servers) are
located at our Goregaon office and our broadcast servers are hosted at VSNL and Reliance
Internet Service Providers (ISP). Our website is hosted with Net Magic Solutions, another
ISP. All the three ISPs and our Goregaon office are equipped with latest servers and
uninterruptible power supply systems. The Goregaon office is connected to the internet by
optic fiber to Net Magic Solutions which gives us bandwidth of more than 10Mbps
expandable to 20Mbps. Our connectivity between the internal and external servers is through
this fiber connection.
Net Magic Solutions sources bandwidth from VSNL and Bharti, thereby providing us
with redundancy in the event of a failure of one of the provider’s gateway. By co-locating
some servers with Reliance Infocom we have further increased our redundancy.
The IndiaInfoline Group has implemented CISCO Pix firewall, managed by Net Magic.
All our servers, routers and desktops are behind this firewall. All connections to our trading
servers happen in a secure manner using 128 bit encryption. We have a security certification
from Thawte.
The key components of our technology infrastructure include
- Online trading software

- Surveillance and risk management
- Client administration
- Back office software
- Communication links and VSAT network

- Networking and hardware
- Security
SWOT Analysis:
Strengths
• Integrated technology platform

• “One Stop” shop
• Pan - India distribution network
• “India Infoline.com” and “5paisa.com” have developed into brands
Weaknesses
• Lack of a banking arm to complete the bank-broker-depository chain
• Insignificant presence in institutional Segment
Opportunities
• Changing demographics with higher disposable income and increasingly complex financial
instruments will drive demand for investment advisory services
• Rapid penetration of Internet and computers means that technology enabled financial
services will gain market share
Threats
• Economic slowdown
• Volatile movement in indices events like May 17, 2004
• Stock markets falls will have a cascading effect on our mutual fund mobilization
• Increase/decrease in interest rate can affect our debt/ income fund mobilizations
• Future changes in personal taxation rules can impact insurance sales
• Increasing competition from large and particularly foreign players
PORTER’S FIVE FORCE MODEL

Competitive Force: - Michael Porter has identified five forces that determine the intrinsic
long-run profit attractiveness of a market or market segment.
• Industry competitors
• Potential entrants.

• Substitutes.
• Buyers.
• Suppliers
Intensity of Competition:
Move towards consolidation
Lot of brokerage companies are moving towards consolidation with the smaller ones
becoming either franchisees for the larger brokers or closing operations.
Increased Focus of Banks in Retail Broking:

Various foreign banks like ABN Amro and others are planning to enter the Indian retail
brokerage industry.
Online Trading Competes with Traditional Brokerage:

There is an increasing demand for online trading due to consumer’s growing preference for
internet as compared to approaching the brokers.
Threat of New Entrants

Entry of Foreign Players
New forms of trading including T+2 settlement system, dematerialization etc are
strengthening the retail brokerage market and attracting foreign companies to enter the Indian
industry.Threat of Substitutes
Alternative Investment Options

Various alternative forms of investment including fixed deposits with banks and post offices
etc act as substitutes to retail broking products and services.
Buyer Power
Lack of Expertise Curtails Bargaining Power
Retail investors often lacks the knowledge and expertise in the financial sector that calls them
to approach the broking houses.

Low Product Differentiation Proves Beneficial:
The retail broking services provided by the various companies are homogeneous with very
low product differentiation. This allows customers to enjoy a greater bargaining power.
Supplier Power
Increased Dependence on IPOs

There is a growing dependence of corporate on broking houses with the rising number of
IPO’s coming to the market.

Financial Performance
Year 2007-08
List Revenue Profit before Profit after tax
interest,
depreciation and
tax
Indiainfoline Ltd. 6,724.4 2,772.5 1,286.9
India Infoline 1,522.1 1,208.9 315.5
Investment
Services Ltd
Moneyline Credit 113.2 19.4 20.7
Ltd
India Infoline 18.4 71.3 56.0
Distribution
Company Ltd

Marketing
Services Ltd

Insurance
Services Ltd
Commodities Ltd

Media and
Research Services
Ltd

Other subsidiaries 96.9 62.4 51.2
Inter-company 326.1 169.2 42.5

adjustments
Aggregate 10,235.9 4,022.2 1,639.3
This is the tabel represents the Revenue, profit before interest, depreciation and
tax in each and every segement of IndiaInfoline and profit after tax in each and
every segment. If we see this table we will find that the total revenu for 2008-09
was 10235.9, and 4022.2 is his profit before interest, depreciation and tax which
is
4022.2 * 100 =39.3%
10235.9
And if we calculate the profit on total revenue it will be
1639.3 * 100 =16.01%

10235.9
And if we calculate the total Interest, depreciation and tax they will be
4022.2-1639.3=2382.9
Rs. Mn
Lists 2007-08 2007-06
Gross Income 6724.4 2867.2
Profit before interest, depreciation and 2,772.5 983.4
taxation
Interest and financial charges 211.6 63.9
Depreciation 194.4 123.3
Profit before tax 2,366.5 796.2

Taxation - Current 793.4 260.7
- Deferred 20.3 2.4
- Fringe benefit tax 10.9 11.9
- Short or excess provision of income-tax 5.3 0.0
Net profit for the year 1,577.2 521.2
Less: Extraordinary items (Net of tax) 290.4 0.0
Less: Appropriations
Dividend:
Interim dividend 0.0 149.6
Proposed final dividend 342.6 0.0
Dividend distribution tax 58.2 21.0
Transfer to general reserves 131.0 53.0
Add: Balance brought forward from 474.1 83.5

previous year
Add: Other adjustments (profits of India 0.0 93.0
Infoline Securities Private Limited added
pursuant to merger)

Balance to be carried forward 1,229.1 474.1
Profit & Loss account of India Infoline

------------------- in Rs. Cr. -------------------
2009 2008
INCOME
Sales Turnover 542.27 616.11
Excise Duty 0.00 0.00
Net Sales 542.27 616.11
Other Income 29.34 27.29
Stock Adjustments 0.00 0.00
Total Income 571.61 643.61
EXPENDITURE
Raw Materials 0.00 0.00
Power & fuel Cost 0.00 0.00
Employee Cost 136.91 128.79
Other Manufacturing Expenses 93.32 105.93
Selling & Admin Expense 112.16 119.13
Miscellaneous Expense 41.03 39.67
Preoperative Exp. Capitalists 0.00 0.00
Total Expenses 383.42 393.42
OPERATING PROFIT 158.85 222.59

PBDIT 188.19 249.88
Interest 11.15 22.82
PBDT 177.04 227.04
Depreciation 25.56 19.44
Other Written Off 0.00 0.00
Profit Before Tax 151.48 207.62
Extra Ordinary Items 2.23 -0.53
PBT(post extra-ord items) 153.71 207.09
Tax 47.88 78.39
Reported Net Profit 105.83 157.73
Total value Addition 383.42 393.53
Preferred Dividend 0.00 0.00
Equity Dividend 79.45 34.36
Corporate Dividend Tax 13.50 5.82
Per Share Data
Share in Issue(in Lakhs) 2,834.00 571.03
Earning Par Share(Rs) 3.73 27.62
Equity Dividend (%) 140.00 60.00
Book Value(Rs) 36.58 17335
This is the Profit and loss account for the years 2007-08 and 2008-09. In which we can see
that the turnover, sale and other profits have decreased from the 2007-08 to 2008-09, which is
an impact of recession.
The total income is also decreased from 643.61 to 571.61 in 09, which is around 11.19% of
the previous year or 72 cr.
In the expenditure part of 2008-09 as compare to previous yes it has also decrease from 393
to 383 which is around 3%. In this the total is decreased instead of increase in employee cost
and Miscellaneous Expense to gain the better profit.

Operating profit was decrease from 222 to 158, approximate 28.82%, from the year 2007-08
to 2008-09.
Report net profit is decreased from 157.73 to 105.83
Share in issued has increase from 571.03 to 2834.00
Earning per share has come down from 27.62 to 3.73 which is 90%
Balance Sheet in Cr.

2009 2008
Sources of funds
Share capital 56.68 57.10

Reserve & surplus 980.13 932.75

Equity share 11.37 59.77
warrants
Net worth 1048.18 1040.62
Loan funds
Secured loan 1.70 -
Unsecured loan 00.10 130.56
Total Liability 1049.98 1180.19
Application funds
Fixed
asset(including
intangibles)
Gross block 143.67 98.31
Less: accumulated 44.94 35.07

depreciation and
amortization
Net block 98.73 63.72
Capital work in 4.51 00.49

progress
103.24 63.73
Investment 873.71 915.68
Currents asset
loan and advance
Sundry debtors 103.52 342.81
Cash & bank 264.10 061.62

balance
Stock on hand 166.72 154.06
Loan & advance 244.41 313.89
778.75 872.38
Less: current
liabilities &

provision
Current liabilities 552.68 514.85
Provisions 148.64 156.74
Total 701.31 671.59
Net current 77.43 200.79

assets
Total of Assets 1049.98 1180.19
This is the Balance sheet of IndiaInfoline showing the comparison for the period of 2007-08
and 2008-09.
In this we can see that the total has come down from 1180 to 1049 in 2008-09 period. Which
is all the impact of recession not only on this broking firm, on all others too, the same impact
was their in this period, their is a cost cutting and reduction on other expenses.
The biggest of this can be seen on the liability side on unsecured loans which has come down
from 130.57 to 00.10, which is more then 99%, organization has increased his cash from
61.62 to 264.10 for the period of 2008-09 as compare to 2007-08.
COMPETITORS
(ACCORDING TO VOLUME)
LAST MARKET SALES NET TOTAL

PRICE CAP. TURNOVER PROFIT ASSET
(Rs.cr)
INDIABULLS 135.20 4188.09 2003.09 99.451 14722.36
INDIA INFOLINE 141.30 4004.44 571.57 103.59 1049.99
EDELWEISS CAP 470.00 3,525.20 191.39 26.39 1,865.28
MOTILAL OSWAL F 170.80 2,443.58 57.26 45.31 433.49
HSBC INVEST 264.00 1,843.68 24.31 -15.21 667.45
FUTURECAPITAL 230.50 1,464.32 132.44 9.31 1,216.75
NETWORK 18 90.20 865.07 94.50 -19.41 862.11

GEOIIT BNP 37.80 847.03 140.56 14.39 276.06
DELTA CORP 43.30 723.81 42.73 8.31 356.87
NALWASONS INV 1,210.0 621.48 14.78 11.26 270.90

0
This table represent the comparision between the indiainfoline and other share broking firms
or inverstment organisation, which includes last price of share, market capital, sales turnover,
net profit and total assets.
This graph shows thr last share price of the organisation, in this we can see that Nalwasons
investment has the highest share price, as compare to others it is very high. The indiainfoline
stand very short in this.
When it comes to market capital the Indiabulls has the highest market capital, and second is
Indiainfoline just behind of Indiabulls and rest other are no ware in this graph.
When we talk about sales turnover of the broking firm, or investment organisation again the
indiabulls has the hight sales turnover, as compare to other its very high, other stand no ware
infront of him, but still indiainfoline manages second position.

The profit is the main aim of each and every organsation. In other factore indiabulls is ahead
of all and indiainfoline but here indiainfoline beats all others including indiabulls.
Indiainfoline’s profit is just ahead of indiabulls.
There are two vacent place which indicates no profit, but it is not like that, here it means loss
both HSBC and NETWORK 18 has suffered a loss of 15.21 and 19.41 respectively.
From this table the coloum of indiabulls has been removes just me make this take appropriate
and attractive, because the total assets of Indiabulls is more then 14700 (NOT SHOWN IN
GRAPH) where as the total of all others is 6996 only.
But finally we can conclude that the Indiainfoline has manage to get the highest net profit
among all his competitors.
PERFORMANCE HIGHLIGHT IN 2008-09

Business Division Business Highlights
• Market share of equities increase from
Broking 3.4% in 2007-08 to 3.76% in 2008-09.
• Customer base for retail equities
increased 35.8% from .44 ml in 2007-
08 to .06 ml in 2008-09.
• Published in-depth and thematic
reports on INCH, politics, rural India,
infrastructure, self commodities,
utilities and India worming.
• Receive Insurance Broking License.
Insurance • Forged alliances with major insurance
companies for the distribution of life
and nonlife products.
• Alter the product mix in favor of
traditional products like Endowment
Products.

• Proactively suspended personal loans
Credit and Finance and mortgages business from
September 2008, while the personal
loan business is still suspended, the
mortgages business has been Re-
Started.
• Revenue at Rs.2654.1 ml in 2008-09
against Rs.1937.5 ml in 2007-08.
• Registered the Housing Finance
Subsidiary with NHB.
Wealth and asset Management • Introduce the family office platform.
• Raised around Rs.1.8 bl in the largest
single day debenture listing of its
kind.
• Received in principle approval for
sitting up of Mutual Funds.
• Establish the infrastructure and
knowledge capital for Office Store
Asset Management Services.
Highlights, 2008-09 Industry optimism

Wealth management
• Mobilised Rs 1.8 bn in the largest single-day debenture listing of its kind

• Built relationships with many reputed families across India and the globe
Asset management
• Received the in-principle approval from SEBI to sponsor a Mutual fund
• IIFL Securities Pte Ltd received approval from the Monetary Authority of Singapore to
carry out corporate advisory and dealing in securities. The Singapore arm can now offer
broking, asset management and investment banking services
• IIFL Inc received an FII license, thereby facilitating the investment of dedicated funds in
India
• Setup a team of experienced professionals for the offshoreasset management business

Key Takeaways from India Infoline concall:
• India Infoline was the Global coordinator and BRLM for the QIP of Emami Limited
and the Co-BRLM to the QIP of Cipla Ltd. Also, they were the Syndicate members to
Adani Power IPO in July 2009.
• The first premium mobilization from insurance broking business stood at Rs 410
million.
• The net NPA on the books continue to remain less than 1%.
• Its core business improved significantly.
• Its market share remains same at 3.6%.
• Average daily equities volumes stood at Rs 33.36 billion as compared to Rs 32.25

billion in the previous quarter.
• The company's customer base improved to 33%.
• Its financial income grew by 48.7%.
• Its employee cost was of Rs 7.36 million.
• Administrator cost grew by 28% at Rs 507 million, QoQ.
• Depreciation coat stood at Rs 131.5 million.
• Interest coat was of Rs 155 million.
• Its advertisement cost was of Rs 24 million.
• Its cash and cash equivalent stood at Rs 9.3 billion and debt was at Rs 300 millions.

FINDINGS
➢ Brokerage of India infoline is higher than Others broking firms like Religare,Motilal
Oswal,Indiabulls,they are charging 0 .03% for Intraday and 0 .30% for Delivery
where India Infoline is taking 0 .05% for Intraday and 0 .50% for Delivery.
➢ Margin money of India infoline is higher than other firm like Indiabulls,Geojit,Motilal
Oswal,there is no restriction of margin moneye.But in India Infoline,the minimum
margin money should be 5000/2555 rs..
➢ Exposure is less than other firms. India Infoline offers eight times exposure on margin
where as Religare and Indiabulls offer twenty times exposure on margin money.

➢ HDFC, ICICI direct provide their customer’s three types of account (de-mat a/c,
trading a/c, bank a/c) but India infoline provide only De-mat a/c and Trading a/c.
➢ Religare takes Rs.299 for lifetime services, where as India infoline takes Rs.555.
➢ Relationship manager changes many times, it creates problem for the offline customers
.
➢ Securities are not so much reliable.
➢ India Infoline has hidden charges, Customer are not much aware about that.
➢ Customer satisfaction of India infoline not so good.
➢ Most of the customers are trading offline.
➢ Most of the customers approach towards the broking firm is through the relationship
manager.
➢ Most of the people are not much aware of share market and its benefit.
Recommendation
➢ To increase awareness about Share Market and the name India Infoline itself, the
company should organize campaign. The campaign can be weakly, monthly, yearly, it
will give a good result to the company to capture market in the competitive position.
➢ The company should reduce the margin money. It can help to acquire more
customers, if the firms bring plans for no boundation of margin money.

➢ The Company should increase their focus on the less margin money customers also .It
can help to make more customers of low margin money which can increase the
revenue of the firm. The Relationship managers focus only to the high margin money
customer because from them they will get high brokerage that should not be happened
from the less margin money customer.
➢ Transaction error should be avoided .Transaction should be done properly, taking in

consideration that it is one of the most required quality of a firm. Wrong transaction
or default transaction may lead the prestige of the company to be down.
➢ Brokerage rate should be reduced. Religare,Motilal Oswal,Indiabulls, are charging as

0 .03% for Intraday and 0 .30% for Delivery where as India Infoline is charging 0 .
05% for Intraday and 0 .50% for Delivery.Though it is negotiable but for high margin
money customer not for less margin money customer.
➢ The Company should increase Exposure. It is the good tool to capture the market.
CONCLUSION
I am much thankful to india infoline for providing me the opportunity for doing training
programme in the organization as management trainee. While doing my sip in the reputed
broking firm India infoline I had got a chance for knowing and analyzing the share market. I

was also able to know about the business environment and business ethics of the business
world. I also came to know about what does a firm or an organization require or wants from a
employee or a trainee. From the survey, I found that India infoline is in the top three position
in the share market.
BIBLIOGRAPHY

 Websites:-
• www.indiainfoline.com
• www.5paisa.com
• www.nse.com
• www.moneycontrol.com
 Book source:-
• Financial management
- Khan & Jain.
• Principal of financial management
-Prassana Chandra
• Business Environment
- Francis Cherunilam
• Annual report of indiainfoline

Nagendra India Infoline Project Report

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A PROJECT REPORT ON

SUBMITTED IN PARTIAL FULFILMENT OF

ACHARY INSTITUTE OF MANAGEMENT AND

SUBMITTED TO:- SUBMITTED BY:-

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 1

Date: -………………………….. Sign:-

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 2

Our sincere thanks to Prof. Dr. KIRAN REDDY, PRINCIPAL AND

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 3

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 4

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 5

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 6

The Indian broking industry is one of the oldest trading

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 7

For the broking industry, we started with an initial

Some key characteristics of the sample 394 firms are:

• On the basis of geographical concentration, the West

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 8

• On the basis of terminals, 40% are located at Mumbai,

• From this study, we find that almost 36% firms trade in

• In the cash market, around 34% firms trade at NSE, 14%

• Majority of branches are located in the North, i.e. around

• In terms of sub-brokers, around 55% are located in the

• In terms of various areas of growth, 84% firms have

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 9

• In terms of IT penetration, 62% firms have provided their

India Infoline was originally incorporated on October 18,

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 10

In May 2000, the name of India Infoline was changed to

In the year 2000, India Infoline leveraged its position as

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 11

India Infoline broking services was launched under the

India Infoline’s main offices are located in approximately

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 12

Branches & Sub-Brokers

The maximum concentration of branches is in the North,

In case of sub-brokers, almost 55% of them are based in

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 13

The financial markets have been classified as cash

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 14

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 15

The survey also revealed that in the past couple of years,

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 16

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 17

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 18

68% of the firms from the sample have envisaged

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 19

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 21

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 23

A forerunner in the field of equity research, IndiaInfoline’s research is acknowledged by

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 24

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 25

Compensation/ Remuneration Committee

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 26

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 27

PRODUCT & SERVICES

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 28

Integrated middle and back office :

ACHARYA INSTITUTE OF MANAGEMENT AND SCIENCES 29

Registered with the NSDL as well as CDSL as a depository participant, providing a

Broking services in cash and derivative segments, online as well as offline.

Provision of free and world-class research to all clients