TABLE OF CONTENTS

Page No.
02

CHAPTER 1

EXECUTIVE SUMMARY

CHAPTER 2

INTRODUCTION
2.1
Introductions to the Topic
2.2
Introduction to the Industry
2.3
Introduction to the Company
2.4
Introduction to the Project

CHAPTER 3

STUDY/PROJECT DETAILS
3.1
Objectives of the Project/Study
3.2
Literature Review
3.3
Study Methodology
3.4
Study Limitations

CHAPTER 4

ANALYSIS & FINDINGS

27-33

CHAPTER 5

CONCLUSIONS & RECOMMENDATIONS

5.1
Conclusions
5.2
Recommendations

34-35
34
35

A-1
A-2
A-3
A-4
A-5
A-6
A-7
A-8
C-1

27
28
28
29
30
31
32
32
36

03-21
03
10
16
21
22-26
22
23
25
26

ANNEXURES
Table 1
Table 2
Table 3
Table 4
Table 5
Table 6
Table 7
Table 8
Bibliography

Chapter 1
EXECUTIVE SUMMARY
Wealth usually refers to money and property or something which has economic
value attached to it. It is the abundance of objects of value and also the state of
having accumulated these objects. The use of the word itself assumes some
socially-accepted means of identifying objects, land, or money as "belonging to"
someone, i.e. a broadly accepted notion of property and a means of protection of
that property that can be invoked with minimal (or, ideally, no) effort and
expense on the part of the owner. Concepts of wealth vary among societies.
Anthropology characterizes societies, in part, based on a society's concept of
wealth, and the institutional structures and power used to protect this wealth.
Several types are defined below. They can be viewed as an evolutionary
progression. Industrialization emphasized the role of technology. Many jobs were
automated. Machines replaced some workers while other workers became more
specialized. Labor specialization became critical to economic success. However,
physical capital, as it came to be known, consisting of both the natural capital
(raw materials from nature) and the infrastructural capital (facilitating
technology), became the focus of the analysis of wealth.

The project covers various aspects such as Financial planning of HNIs, Portfolio
management services, Portfolio restructuring, Algorithmic trading. In short it
explains that, brokerage firms have many products to manage and increase the
wealth.

Chapter 2
INTRODUCTION
2.1

Introduction to the topic

Wealth management Service is provided by banks, professional trust companies,
and brokerages. For those with sizable assets, professional wealth management
can help you plan your estate or invest your assets based on personal criteria and
financial goals. Wealth Management system is an integrated platform designed to
support high demand of customer relationship businesses and a complex
portfolio management analysis. The solution provides technology that helps
private wealth institutions utilize their customers database more proficiently and
more efficiently. With India Infoline wms sophisticated work system, firms will be
able to enhance their services and sale capabilities throughout a comprehensive
set of wealth management services such as investment strategy setting, marketing
event or campaign management, a high level of portfolio management or a
graphic design of a consolidated report. Wealth management System offers a onestop solution to take the guess work out of mandatory rollovers so you can save
time and money. Wealth management is an advanced investment advisory
discipline that incorporates financial planning and specialist financial services.
The key objectives are to provide high net worth individuals and families with
tailored retail banking services, estate planning, legal resources, taxation advice
and investment management, with the goal of sustaining and growing long-term
wealth. Wealth management can be provided by independent financial advisers
or large corporate entities whose services are designed to focus on high-net
worth retail customers. Such customers would be considered mass affluent or
upper retail clients because of their net worth, the number of potential products
they own from financial institutions, their assets under management and other
methods of segmentation. Large banks and brokerage houses create separate
sales forces, services and other benefits to retain or attract these customers who
are typically more profitable than other retail banking, brokerage, or insurance
customers. In most industrialized countries, a substantial part of financial wealth
is not managed directly by savers, but through a financial intermediary, which
implies the existence of an agency contract between the investor (the principal)
and a broker or portfolio manager (the agent). Therefore, delegated brokerage
management is arguably one of the most important agency relationships
intervening in the economy, with a possible impact on financial market and
3

economic developments at a macro level. As the per-capita-income of the city is

on the higher side, so it is quite obvious that they want to invest their money in
profitable ventures. On the other hand, a number of brokerage houses make sure
the hassle free investment in stocks. Asset management firms allow investors to
estimate both the expected risks and returns, as measured statistically. There are
mainly two types of Portfolio management strategies.
Passive Portfolio Strategy
Active Portfolio Strategy

Passive Portfolio Strategy:

A strategy that involves minimal expectation input, and instead relies on
diversification to match the performance of some market index. A passive
strategy assumes that the marketplace will reflect all available information in the
price paid for securities

Active Portfolio Strategy:

Astrategy that uses available information and forecasting techniques to seek a
better performance than a portfolio that is simply diversified broadly.

The basic methods of wealth management

1) Mutual funds.
A Mutual Fund is a body corporate registered with SEBI (Securities Exchange
Board of India) that pools money from individuals/corporate investors and
invests the same in a variety of different financial instruments or securities such
as equity shares, Government securities, Bonds, debentures etc. Mutual funds can
thus be considered as financial intermediaries in the investment business that
collect funds from the public and invest on behalf of the investors. Mutual funds
issue units to the investors. The appreciation of the portfolio or securities in
which the mutual fund has invested the money leads to an appreciation in the
value of the units held by investors. The investment objectives outlined by a
Mutual Fund in its prospectus are binding on the Mutual Fund scheme. The
investment objectives specify the class of securities a Mutual Fund can invest in.
Mutual Funds invest in various asset classes like equity, bonds, debentures,
commercial paper and government securities. The schemes offered by mutual
funds vary from fund to fund. Some are pure equity schemes; others are mix of
equity and bonds. Investors are also given the option of getting dividends, which
are declared periodically by the mutual fund, or to participate only in the capital
appreciation of the scheme

2) Equities
Equity trading is the buying and selling of company stock shares. Shares in
large publicly-traded companies are bought and sold through one of the
major stock exchanges, such as the Bombay Stock Exchange, National Stock
Exchange, which serve as managed auctions for stock trades
Share or stock is a document issued by a company, which entitles its holder to be
one of the owners of the company. A share is issued by a company or can be
purchased from the stock market.
2.1Share market: where dealing of securities is done is known as share market.
There are two ways in which investors gets share from market:
2.2Primary market: markets in which new securities are issued are known as
primary market. This is part of the financial market where enterprises issue their

new shares and bonds. It is characterized by being the only moment when the
enterprise received money in exchange for selling its financial assets.
2.3. Secondary Market: Market in which existing securities are dealt is known as
secondary market. The market where securities are traded after, they are initially
offered in the primary market. Most trading is done in the secondary market. The
Stock Market is an invisible market that trades in stocks of various companies
belonging to both the public and private sectors. The Indian Stock Market is often
referred to as the Share Market since it deals primarily with shares of various
companies. A Stock Exchange is a place where the stocks are listed and traded.
Such exchanges may be a corporation or mutual organization which specializes in
the business of introducing the sellers with the buyers of stocks and securities.
The Indian Stock Market in India comprises of two stock exchanges:
Bombay Stock Exchange (BSE)
National Stock Exchange (NSE)

2.3.1. Bombay Stock Exchange (BSE)

The Bombay Stock Exchange (BSE) was established in 1875.The BSE India Stock
Exchange serves as the most important for companies to raise money. The chief
function of the Stock Market of India is to help raise money as capital for the
growth and expansion of various private and public sector enterprises. Besides,
the Stock Market of India provides able assistance to the individual investors
through daily updates on current position of the stocks of the respective
companies that are enlisted in the Stock Index in which the movement of prices in
a section of the market are captured in price Indices. The popular acronym for
Stock Index is Sensitive index or sensex. Moreover, the liquidity provided by the
exchange enables the investors to sell securities owned by them easily and
quickly. Hence a person, who is subjected to sudden dearth of funds, can
immediately sell his shares for cash in India Stock Market. The BSE Sensex, also
known as BSE 30 is a widely used market index not only in India but across Asia.
In terms of volume of transactions, it is ranked among the top five
stock exchanges in the world.

2.3.2. National Stock Exchange (NSE)

The National Stock Exchange of India Ltd. (NSE), set up in the year 1993, is today
the largest stock exchange in India and a preferred exchange for trading in equity,
debt and derivatives instruments by investors. NSE has set up a sophisticated
electronic trading, clearing and settlement platform and its infrastructure serves
as a role model for the securities industry. The standards set by NSE in terms of
market practices; products and technology have become industry benchmarks
and are being replicated by many other market participants. NSE provides a
screen-based automated trading system with a high degree of transparency and
equal access to investors irrespective of geographical location. The high level
of information dissemination through the on-line system has helped in integrating
retail investors across the nation. The exchange has a network in more than 350
cities and its trading members are connected to the central servers of the
exchange in Mumbai through a sophisticated telecommunication network
comprising of over 2500 VSATs.
NSE has around 850 trading members and provides trading in equity shares and
debt securities. Besides this, NSE provides trading in various derivative products
such as index futures, index options, stock futures, stock options and interest rate
futures. In addition to these organizations there are other organizations
highlighting on the share trading in the Indian Stock Market are:
Securities and Exchange Board of India (SEBI)
NSDL
CDSL

3 ) Commodities
Do you think gold prices will go up further? Are you sure that crude oil prices are
going to fall? Have you heard that the soya crop this year is bad and will result in
soya prices going up?
If you believe that these predictions have a good chance of coming true and are
willing to bet some money on them, you could try your hand at playing the
commodity futures market. A commodity is a basic good representing a monetary
value. Commodities are most often used as inputs in the production of other
goods or services. With the advent of new online exchange, commodities can now
be traded in futures markets. When they are traded on an exchange, Commodities
must also meet specified minimum standards known as basic grade.
Types of Commodities
7

 Precious Metals: Gold and Silver

Base Metals: Copper, Zinc, Steel and Aluminum
Energy: Crude Oil, Brent Crude and Natural Gas
Pulses: Chana, Urad and Tur
Spices: Black Pepper, Jeera, Turmeric, Red Chili
Others: Guar Complex, Soy Complex, Wheat and Sugar

4 ) Bonds
Bonds refer to debt instruments bearing interest on maturity. In simple terms,
organizations may borrow funds by issuing debt securities named bonds, having a
fixed maturity period (more than one year) and pay a specified rate of interest
(coupon rate) on the principal amount to the holders It is a fixed income (debt)
instrument issued for a period of more than one year with the purpose of raising
capital. The central or state government, corporations and similar institutions sell
bonds. A bond is generally a promise to repay the principal along with a fixed rate
of interest on a specified date, called the Maturity Date
5) Portfolio Management Service (PMS)
Portfolio management service (PMS) is a type of professional service offered by
portfolio managers to their client to help them in managing their money in less
time .Portfolio managers manage the stocks, bonds, and mutual funds of clients
considering their personal investment goals and risk preferences. In addition to
money, the portfolio managers manage the portfolio of stocks, bonds, and mutual
funds. Successful investing in Capital Markets demands ever more time and
expertise. Investment Management is an art and a science in itself. Portfolio
Management Services (PMS) is one such service that is fast gaining eminence as
an investment avenue of choice for High Net worth Investors (HNI). PMS is a
sophisticated investment vehicle that offers a range of specialized investment
strategies to capitalize on opportunities in the market. The Portfolio Management
Service combined with competent fund management, dedicated research and
technology, ensures a rewarding experience for its clients .India Infoline PMS
brings with it years of experience, expertise, research and the backing of India's
leading stock broking house. At Angel, experienced portfolio management is the
difference. It will advise you on a suitable product based on factors such as your
investment horizon, return expectations and risk tolerance

6) Loan
A loan is a type of debt. Like all debt instruments, a loan entails the redistribution
of financial assets over time, between the lender and the borrower. In a loan, the
borrower initially receives or borrows an amount of money, called the principal,
from the lender, and is obligated to pay back or repay an equal amount of money
to the lender at a later time. Typically, the money is paid back in regular
installment, or partial repayments; in an annuity, each installment is the same
amount. The loan is generally provided at a cost, referred to as interest on the
debt, which provides an incentive for the lender to engage in the loan. In a legal
loan, each of these obligations and restrictions is enforced by contract, which can
also place the borrower under additional restrictions known as loan covenants.
Acting as a provider of loans is one of the principal tasks for financial institutions.
For other institutions, issuing of debt contracts such as bonds is a typical source
of funding.
7 ) Insurance
Insurance is a basic form of risk management which provides protection
against possible loss to life or physical assets. A person who seeks protection
against such loss is termed as insured, and the company that promises to honor
the claim, in case such loss is actually incurred by the insured, is termed as
Insurer. In order to get the insurance, the insured is required to pay to the
insurance company (i.e. the insurer) a certain amount, termed as premium, on a
periodical basis (say monthly, quarterly, annually, or even one-time).

2.2

Introduction to brokerage industry

A brokerage firm, is a financial institution that facilitates the buying and selling of
financial securities between a buyer and a seller. Brokerage firms serve a clientele
of investors who trade public stocks and other securities, usually through the
firm's agent stockbrokers. A traditional, or "full service," brokerage firm usually
undertakes more than simply carrying out a stock or bond trade. The staff of this
type of brokerage firm is entrusted with the responsibility of researching the
markets to provide appropriate recommendations and in so doing them direct the
actions of pension fund managers and portfolio managers alike. These firms also
offer margin loans for certain approved clients to purchase investments on credit,
subject to agreed terms and conditions. Traditional brokerage firms have also
become a source of up-to-date stock prices and quotes.

India has attempted to capture critical features and characteristics of the Indian
broking industry while felicitating the various distinguished firms of the Indian
broking industry.
This publication features 130 leading Indian equity broking firms. It provides a
brief outline of the Indian equity markets and includes a Primary insights section,
which focuses on analyzing key trends of 42 Indian equity broking firms.
The 42 equity broking firms considered for the study had46,960 Trading
terminals,2,896directly managed offices (excluding sub-brokers) and 46,793
employees across the country

Around 33% of the companies were part of the income range of below250 mn
during FY14. However, companies earning income between 2,500.1 mn and 5,000
mn accounted for the highest share in total terminals at around 40% and in total
trading turnover at around 36%

Nearly 34% of the overall sample companies were engaged in three market
segmentsequity cash, equity derivatives, and currency futures & options during
FY14

10

 The total client accounts increased by c.8.4% y-o-y during FY14.However, the
number of e-broking clients recorded a higher growth rate of c.11.3% y-o-y
during the same period
The total income generated by broking accounts of the overall sample companies
Stood at14.13 bn during FY14, increasing by c.8% y-o-y

The Indian equity market has been gradually undergoing a shift from trading in
the Cash segment to the derivatives segment. During FY14, the trading turnover
in the cash segment declined by 4.2% y-o-y of the overall sample companies.
Conversely, trading turnover in the derivatives segment showed an upsurge by
c.8.9% y-o-y

Although the usage of mobile trading is quite low in India, but it is growing at a
faster rate .InFY14, the overall sample companies registered robust growth rate of
nearly c.69.7% y-o-y in terms of number of clients using mobile-trading facility.
The usages of mobile trading facilities have shown significant growth in overall
trading from 2.7% in FY13 to 4.2% of the total client accounts during FY14

After going through a rough phase in the last couple of years, the Indian equity
markets rebounded in FY15. Muted global growth, ample liquidity, comparatively
limited opportunities in other emerging markets along with a renewed optimism
in the Indian economy post the formation of a stable government brought large
quantum of foreign money into the Indian Capital Markets. Other factors such as
declining oil prices, lower inflation and the Governments inclination towards
adhering to fiscal discipline improved the domestic macro economic outlook
resulting in a renewed interest by investors in the domestic markets. Not only did
the benchmark indices scale newer highs, even broader based mid-cap indices
displayed a significant uptick during FY15. In our interactions with key industry
participants, we noted a significant optimism with regard to future prospects for
the brokerage business.
At the industry level, Equity Average Daily Volumes (ADV) rose by ~14% YoY
during 9MFY15 to ~Rs 2.36 trillion. While this may be considered as moderate,
11

what is important to note is the strong uptick in cash volume ADV which
increased by more than 55% YOY to Rs 0.21 trillion in 9MFY15. Equity derivative
ADV rose by 11% in 9MFY15 to Rs. 2.15 trillion when compared with 9MFY14.
Also, important to note is that equity options volumes, which have otherwise been
driving the equity ADV growth in the past, ebbed in 9MFY15. Options ADV has
remained nearly flat at Rs 1.65 trillion in 9MFY15 when compared to Rs 1.60
trillion for 9MFY14. Consequently, during 9MFY15, 53% YoY growth in total cash
volumes and 48% YOY growth in total equity futures volumes have contributed to
the robust growth in the overall market volumes. Also, for 9MFY15, mix of cash to
futures to options volumes has corrected to 9:21:70 as compared to 7:16:77 for
9MFY14.
These indicators clearly point at three key industry trends. One, broader set of
investors (retail, institutional and HNIs) has participated in the markets during
9MFY15 as indicated by the strong increase in cash volumes. Two, with
decreasing risk aversion, traders have preferred to move into the futures segment
in place of the options segments. Three, volumes have increased in higher margin
segment like the futures and, in particular, cash volumes, the overall revenue and
profitability profile and, thereby, the credit profile of the brokerage industry is
expected to improve.
Retail investors seem to have returned to the capital markets indirectly as seen by
the robust inflows into the equity schemes of Mutual Funds during the last 9-10
months. Further, many brokers have reported ~40-60% increase in activity levels
of the clients. However, for retail brokers the activity levels remain much lower
than what was observed in the heydays of FY08 or FY11. As per the data obtained
from the exchanges, ~32-34% of overall volumes currently originate from
internet / mobiles / tablet platforms. This particular phenomenon is expected to
have a lasting impact on the manner in which the industry evolves with much of
the incremental client addition for larger brokers being online clients. Also, the
thrust on branch / franchisee model for client servicing is reducing in the larger
cities / towns while limited traction in terms of setting up of branches remains in
Tier II and Tier III towns. Many of the participants interviewed, result have
reported a decline in their number of branches as well as in franchisees.
The commodity broking activity levels continue to remain at muted levels, even
though it is more than 18 months since the CTT (Commodity Transaction Tax)
was imposed and the NSEL crisis occurred. While the imposition of the CTT has
12

kept most jobbers and arbitrageurs away, the occurrence of the NSEL crisis seems
to have impacted investor confidence adversely, thereby, forcing most players to
approach the commodity markets cautiously. The total volumes at the exchanges
during Q3FY15 are less than one-fourth of the volume levels witnessed in Q1FY14
(just before the unfolding of the aforementioned developments). Commodity
volumes across segments, during 9MFY15, reported contraction with bullion
leading the pack by de-growing by 50% on an annualized basis over FY14. The
share of thebullion volumes (which once used to account for majority of the
trades at the exchanges) in the overall volume mix has declined to 30% during
9MFY15 while the proportion of energy and agri-commodities declined to 22%
and 16% respectively during this period.
The rising activity in the currency derivatives segment in the last few months is
seen as an early sign of improvement after the segment had witnessed sizeable
reduction in volumes post the imposition of various currency-speculation
restrictions by the RBI and SEBI in September 2013. The improvement in volumes
can largely be attributed to lifting of certain restrictions by the RBI a few quarters
ago. Volumes had picked up in Q2FY15 with a 27% sequential rise in quarterly
volumes to Rs. 13.7 trillion vis--vis Rs. 10.7 trillion in Q1FY15. However, in
Q3FY15, volumes shrunk sequentially by about 8% to Rs. 12.7 trillion.
In the retail brokerage industry, recognized the emergence of discount brokers,
strong foothold of the banker brokers, changed positioning of larger standalone
brokers as well as the challenging environment for smaller standalone brokers.
Retail brokerage segment is now gradually segmenting itself among three
different niches. At one end are the larger standalone brokers who, as equity
markets have gained momentum and retail investors have started trickling back
into the markets, have gained market share to clearly demonstrate their value
proposition. In the middle are banker brokers, who have also gained market share
though not necessarily at the same pace as the standalone brokers. Low cost of
acquisition of newer clients, strong parent balance sheets and thus larger
resources and a better grip on technology are significant competitive advantages
and expects banker-brokers to continue flourishing and be the preferred choice,
particularly for the new to the market investors. However, the most significant
structural change is the strides taken by discount brokers. Measured against
parameters like market share, client activity levels and even profitability,
discount brokers have made good progress over the past 12-24 months. Their
value proposition is enticing many first time investors / traders and they compete
13

both with the banker brokers as well as standalone brokers. , These discount
brokers could continue to gain traction, though scaling up would continue pose a
challenge. However, all these players continue to improve their market presence
largely at the expense of smaller standalone brokers. Only a handful of smaller
standalone brokers have benefitted from the increased retail participation and
higher activity levels of these customers and many have continued to lose market
share. While buoyant capital markets may potentially offer some respite to the
smaller standalone brokers, many of them lack the wherewithal to invest for the
future and hence may continue to lose market share.
Foreign institutional investors (FIIs) have invested ~USD 44 billion in Indian
Capital markets in FY14-15, the highest investment by FIIs in any fiscal year. Of
this ~USD 17 billion has been invested into Indian equities. Even Domestic
Institutional Investors (DIIs) have turned net buyers over the same period.
Anecdotally, risk perception about India as an investment destination has
reduced and allocation to India amongst emerging market funds have increased.
Consequently, institutional brokers have flourished. The revenue mix between
foreign brokers and domestic institutional brokers has shifted in favors of the
Indian brokers marginally.
Estimated, that the total broking revenue for the 15 brokers analyzed has
registered a significant rise of about 20-25% in FY15 (based on trends seen till
H1FY15) vis--vis for the full year FY14. The growth in income is attributable to
nearly all business lines which include brokerage income, interest income,
depository income, wealth management fees and trading income. The total
operating expenses underwent a marginal decline in FY14. The cost mix has
remained nearly the same during these years with employee expenses being the
largest component (48% of total expenses during both these years). However, in
9MFY15, there has been an annualized increase (over FY14) of about 15-16% in
total expenses over FY14. Increase in expenses was largely driven by aggressive
shoring up of sales force by brokerage houses with increasing retail participation.
With improvement in operating leverage, lead primarily by robust revenue
growth, profitability metrics witnessed improvement in FY14 enabling these
companies to report an aggregate ROE of around 8.3% during this period.
Further, robust revenue growth in 9MFY15 enabled these players to improve the
aggregate ROE to 11.3% for this period. In terms of leveraging, companies have
increased theborrowings on their balance sheet in order to grow the capital

14

markets financing books. Estimated, as on Dec-14, the gearing levels rose to 2.3
2.5x times vis--vis 2.08x times as on Mar-14.
This note covers the financials of 151 entities. However, for market share,
brokerage revenue pool analysis, the data has been used for 162 prominent
brokerage firms.

15

2.3

Introduction to India Infoline

IIFL was co-founded on Oer 17, 1995 by Nirmal Jain and R. Venkatraman. Jain was
previously employed with Hindustan Lever Limited. The company was founded as
Probity Research and Services Private Limited which provided research on the
Indian economy, businesses and corporate. The name was later changed to India
Infoline Limited.
A few years into the business, the organization found itself with clients which
included research organizations, banks and corporate. They then began launching
their research products to become more noticeable in the market. In the
meanwhile, the dotcom revolution was beginning to take place in India. Taking
advantage of this revolution would mean an increase in the number of readers to
millions. The website was created in 1999.
Taking the business one step ahead this group of consultants opened a trading
portal www.5paisa.com in 2000 thus moved into the business of being a full
service broking agency. During this time they widened their distribution network.
In 2001, the Indian dotcom industry saw a downfall. During this time, sustaining
became tough. The organization then decided to tie-up with leading Life
Insurance company ICICI Prudential, thus putting to use its distribution network
and becoming Indias first corporate agent for insurance.
In 2009, IIFL also held their first global investor conference, Enterprising India,
which was attended by the likes of Jim Walker, David Bloom and Brahma
Chellany, amongst others.
India Infoline gradually evolved into a one-stop financial services solutions
provider. Its strong management team comprises competent and dedicated
professionals. India Infoline is a pan-India financial services organization across
1,361 business locations and a presence in 428 cities. His global footprint extends
across geographies with offices in New York, Singapore and Dubai. India Infoline
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. India Infoline are
registered with the BSE and the NSE for securities trading, MCX, NCDEX and DGCX
for commodities trading, CDSL and NSDL as depository participants. They are
registered as a Category, I merchant banker and are a SEBI registered portfolio
manager. They also received the FII license in IIFL Inc. IIFL Securities Pvt Ltd
received approval from the Monetary Authority of Singapore to carry out
corporate advisory and dealing in securities operations. Two subsidiaries India
16

Infoline Investment Services and Money line 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.

Vision
To become the most respected company in the financial services space in India
Values
1) Values are IIFL are summarized in one acronym: GIFTS
2) Growth with focused team of dynamic professionals
3) Integrity in all aspects of business no compromise in any situation
4) Fairness in all our dealings employees, customers, vendors and
shareholders all included
5) Transparency in what we do and in how and why we do it
6) Service orientation is our core value, imbibed by all sales as well as
support. Teams.
Business strategy
1) Steady growth by adapting to the changing environment, without losing
the focus on our core domain of financial services
2) De-risked business through multiple products and diversified revenue
stream
3) Knowledge is the key to power superior financial decisions
4) Keep costs low and continuously strive for innovation.

Customer strategy
1) Remain largely a retail focused organization, driving stickiness through
knowledge and quality service
2) Cater to untapped areas in semi-urban and rural areas, which is relatively
safe from cut-throat competition
3) Target the micro, small and medium enterprises mushrooming across the
country through a cluster approach for lending business
4) Use wide multi-modal network serving as one-stop shop to customers.
17

People strategy
1) Attract the best talent and driven people
2) Ensure conducive merit environment
3) Liberal ownership-sharing

Operations and Global Offices

India Infoline has about 4000 business locations in about 900 cities. Apart from
India they are present in 8 other countries - Singapore, Dubai, USA, UK,
Switzerland, Hong Kong, Mauritius and Sri Lanka.

Achievements Timeline
1) 2004: Obtained commodities license
2) 2005: Listed in BSE and National Stock Exchange of India
3) 2008: Launch of IIFL Private Wealth Management
4) 2010: Became the first Indian Broker to register on Colombo Stock
Exchange
5) 2010: Received an approval for membership of the Singapore Stock
Exchange
6) 2009: First edition of Enterprising India
7) 2011: Launch if IIFL Mutual Fund
8) 2012: Announced Real Estate Fund
9) 2013: Launched the largest AIF Fund in India

18

Company Profile
IIFL Holdings Ltd is divided into 10 companies.
1)

India Infoline Ltd.

2)

India Infoline Finance Limited: India Infoline housing Finance Limited is

under this company.

3)

India Infoline Insurance brokers Ltd.

4)

India Infoline Commodities Ltd.

5)

IIFL Assets management company & IIFL MF

6)

IIFL Private Wealth management Ltd.

7)

IIFL (Asia) Pte Ltd.

8)

IIFL Inc. (US) investment Advisors Ltd.

9)

IIFL (UK)

10) IIFL Multi National Company.

19

Awards and Recognition

1)

Three of the analysts from the Pharma, Banking and Oil & Gas sector
respectively won the India's Best Market Analyst Awards 2013 by Zee
Business

2)

Best Wealth Management House by The Asset Triple A 2012

3)

Best Customer Service in Financial Services, 2013 Retailer Customer

Service Awards

4)

Best Broking House with Global Presence, 2012 D&B

5)

BSE Group felicitated IIFL for being one of the top performers in the
'Equity FI' category on Mahurat Trading day-to-day

6)

Mr. Nirmal Jain, Chairman, IIFL received the 'Entrepreneur of the Year'
award at the 10th Franchise India Awards 2012

7)

IIFL Buzz won the prestigious award for the internal tabloid at the 53rd
annual awards night of the Association of Business Communication of
India (ABCI)

8)

Best Private Banking Services Overall India Euro money Private

Banking Survey 2014

9)

Best Wealth Management company in India - Wealth Briefing Asia Awards

2013

10) Fastest

Growing Wealth Management Company - CNBC TV 18 Financial

Advisor Awards 2013

20

2.4 Introduction to the Project

The project undertaken is on Wealth Management Services of HNIs inINDIA
INFOLINE LIMITED.
It describes about how the company manages wealth of HNIs and the various
steps that are required in the management of Wealth.
Portfolio Management Services is a part of wealth management services, Portfolio
management is all about strengths, weaknesses, opportunities and threats in the
choice of debt vs. equity, domestic vs. international, growth vs. safety, and many
other tradeoffs encountered in the attempt to maximize return at a given appetite
for risk.
Portfolio restructuring of HNIs has been done, Portfolio restructure is ,changing
the configuration of a portfolio by selling off unwanted assets or asset types, and
replacing them with preferred assets. This may be done by altering the
documented structure of the portfolio, or through the investment firm buying the
portfolio from the investor and then selling them a portfolio of the desired
composition.

This project describes how the Wealth Management takes place at India Infoline
Limited.

21

Chapter 3
STUDY/PROJECT DETAILS

3.1

Objectives

To understand the wealth management services of HNIs clients in India Infoline

Limited and financial planning of the clients.

22

3.2

Literature review
1) Wealth Engine: Indian Financial Planning and Wealth Management by
Sundar Sankaran: How to turn your savings into wealth Profitable investing is
the key to converting savings into wealth. For this, you require a clear financial
plan, an understanding of various investment products and timely action. This
innovative handbook is a comprehensive guide to the entire process of wealth
building and wealth management: Wealth Engine highlights the risks and returns
from all the popular investment classes, including equity, debt or income
investments, gold, real estate, art, etc. It provides a wealth of detail about the
different products available in each investment class, along with their actual,
sometimes startling, historical returns. Shows you how to make and implement
your financial plan to get rich. Uniquely, the book looks at the world of personal
finance and investments from an Indian perspective. It provides an innovative
solution for weaving together all the elements of financial planning and profitable
investing into an actionable programs, including cash flow planning, asset
allocation, managing your liabilities and loans, estate planning, succession
management and tax planning. Moving smoothly between a birds eye view and a
worms eye view, the author provides a 360-degree perspective on financial
planning and wealth management and shows how your personal wealth engine
can make you rich. Written by the author of the bestseller Indian Mutual Funds
Handbook, this book is destined to become an investment classic.

2)NISM X-A: The Module X-A helps us to Know the basics of investment advisory,
steps in the advisory process, making and implementation of financial plan.
Understand how to evaluate different products, their suitability and how the
recommendation of the same can impact investment risks, returns and strategies
in a personal finance environment for investors and prospective investors in the
market. Get oriented to the Income tax, Wealth tax and legalities of Estate
planning in personal finance, and regulatory aspects underlying advisory. Get
acquainted with financial planning as an approach to investing, insurance,
retirement planning and an aid for advisers to develop long term relationships
with their clients.

23

3) The New Wealth Management: The Financial Advisor's Guide to Managing

and Investing Client Assets
Provide financial planners with detailed, step-by-step guidance on developing an
optimal asset allocation policy for their clients. And, it did so without resorting to
simplistic model portfolios, such as lifecycle models or black box solutions. Today,
while The New Wealth Management still provides a thorough background on
investment theories, and includes many ready to use client presentations and
questionnaires, the guide is newly updated to meet twenty-first century
investment challenges

4) Family Wealth: Keeping It in the Family, by James E. Hughes, Jr. Other

forms of family wealth are much more important than money, many thoughtful
observers believe. One of those observers is Hughes, an attorney, noted family
counselor and a truly wise man. He provides the basic framework to help families
understand and nurture their nonfinancial wealth. Insightful and also highly
useful for family members.

5) Winning the Loser's Game, by Charles D. Ellis. If your client will only read
one book about investing, see that this is the one. First published in 1975, the
Loser's Game remains fresh and insightful. Attempting to outperform the market
was a fool's errand then, and remains so. Charley Ellis explains why in a lucid and
compelling way.

24

3.3.

Methodology
Research Design

Data Collection Sources

Data collection has solely been done through primary and secondary sources.
Primary Source:
For Primary data, Case study method was adopted to study the Financial planning
of HNIs clients
Secondary Sources:
1) Articles
2) Books
3) Newspapers
4) Annual Reports
5) Bank Website

25

3.4.

Limitations

1)

Due to privacy issue, I was not able to disclose all the details regarding to my
objectives. Hence I am not able to provide all the aspect in details.

2)

I was not allowed to take the details out to the office not even to access my
mail id in the office.

26

Chapter 4
ANALYSIS & FINDINGS
Financial Planning

Client name, Mr. Nikhil Arora (changed name) wanted to plan hi Financials through IIFL.
For Financial Planning, IIFL charge Rs.10000 for planning. After the amount has paid
then planning has been done as per the details given by Mr.Arora and the most
important is their goal what he wants to achieve in future, hence based on the given
detailed then suggestion and recommendation is given in the Financial Planning Report
Details required are:

1) Personal detail

Name : Mr .Nikhil Arora

Age:45

Contact no : 989*******

Email Id:

Address:
Table no .1

27

Occupation:

2) Family Detail

NAME

RELATIONSHIP

AGE

OCCUPATION

Wife

33

Salaried

Daughter

Student

Son

Infant

Table no 2

3) Your Financial Goal

GOAL NAME

YEARS TO
GOAL

INFLATION
RATE%

GOAL
PRIORITY

12

PRESENT
COST OF
GOAL(RS)
300000

X-Graduation

8%

Retirement

19

300000

8%

Y-Education
fund
X-marriage

15

600000 p.a

8%

20

1000000

8%

Vacation

500000

8%

Table no 3

28

4) Income-Expense Analysis

INCOME
Monthly

Yearly

Salary of Self

110000

1320000

Rental income

12000

144000

Spouse income

43700

524000

Total

165700

1988400

Table no 4

Pie Chart

26%

Salary of Self
Rental income
Spouse income
8%
66%

29

Expenses
Expenses Type

Monthly

Yearly

Household

30000

360000

Entertainment

5000

60000

Medical

1000

12000

Education

5500

66000

Loan

15500

186000

Total

57000

684000

Table no 5
Pie chart

27%
Household
Entertainment
Medical
53%

Loan

10%

1%

Education

9%

30

6) Insurance and Investment.

TYPE

MONTHLY

YEARLY

Investment
(PPF+MF+SIP)

37083

445000

Life insurance premium

14207

170489

TOTAL

51291

615489

Table no 6

31

7) Goals
Based on your assumption of the present cost of your goals and considering the rise In
the cost of these goal, you will need more amount at the time of goal realization. The
table below give sought amount you will need in future for your goals
General Goal
GOAL NAME

Present cost

Year of goal

Future cost

Vacation 1

500000

583200

Vacation 2

500000

856912

Table no 7

Children Goal
GOAL NAME

Present cost

Year of goal

Future cost

X-Graduation

300000

12

7554510

Y-Marriage

1000000

27

7988056

X/Y Education
fund

1000000

15

3172169

Table no 8

32

8) Analysis and Suggestion

We suggest to reduce the value of your vacation goal from 500000 to 300000,as you will
not having the sufficient surplus in the first two year to accommodate the desire value
.For accommodating they require corpus , we suggest you to make fresh investment into
debt instruments.
Suggestions:

Insure your life for an additional amount of Rs 85lakhs

Take a family floater medical insurance cover for your family for Rs 4lakh
and increase the same regularly.

Insure your existing house property.

Postpone your retirement by 3 years to your age of 58 ,if you want to

spend the desire post retirement expenses and accommodate your
vacation 2 goal(7 years)

Create the medical contingency fund of Rs 10lakh(in todays value) by the

time you retire

Start investing and accumulating the shortfall in your goal and retirement
corpus and start paying insurance premium.

33

Chapter 5
CONCLUSIONS & RECOMMENDATIONS
5.1.

Conclusion
Wealth managers are beginning to investigate innovative segmentation methods
to manage the changing client profile. Over the next 20 years wealth managers
will hone their segmentation methods. Wealth managers will develop
segmentation as a service efficiency initiative. Segmentation models will apply
holistic criteria to wealth management. The most important segments globally
will be entrepreneurs and SMES/CEOs. Financial advisers will become an
important separate client segment for wealth managers The organization of
direct client ownership will also change Availability and flexibility will become
vital components of the business model Internal restructuring will aim to
integrate client services. The rise of the mass affluent represents an opportunity
for wealth managers in the medium term Wealth managers will capture the
higher value mass affluent market by offering a scaled down wealth management
service. The mass affluent proposition will run along the lines of the current
wealth management service. Liability management is currently not part of the
wealth management agenda but has proven potential. Clients in developed
markets are seeking more holistic wealth management services Liability
management is clearly a profitable area with a proven existing client base. The
incorporation of lending into wealth management will shift the focus of the
service. Specialist forms of lending will also become common additions to the
offerings of many wealth managers. Some will fail due to a persistence of the
asset focused service model and a lack of commitment. There are significant
benefits in the area of liability management for the wealthy, and that the
importance of liability management as part of wealth management will inevitably
grow over the next 20 years, until it becomes a key service area. Rising income
and wealth inequalities, if not matched by corresponding rise of incomes across
the nation, can lead to social unrest. An area of great concern is the level of
ostentatious expenditure on weddings and other family events. Such vulgarity
insults the poverty of the less privileged, it is socially wasteful and it plants the
seeds of resentment in the minds of the have-nots

34

5.2

Recommendations

1)

Financial Planning should be cheaper.

2)

Portfolio management services also should be cheaper.

3)

There should be a corporate event to retain clients.

4)

Special brokerage or offer should be allowed for ultra HNIs.

5)

Should not call the clients before 10am.

6)

CFP should be compulsory for the entire employee who doing Financial
planning.

35

C1. Bibliography

Book referred

1) Wealth Engine: Indian Financial Planning and Wealth Management by Sundar

Sankaran.
2) NISM X-A
3) The New Wealth Management: The Financial Advisor's Guide to Managing and
Investing Client Assets
4) Family Wealth: Keeping It in the Family
5) Winning the Loser's Game

Websites

www.moneycontrol.com
www.indiainfoline.com
www.info.shine.com

36