PROJECT REPORT

ON

“Formulation of Marketing Strategy and its

Execution for Financial Products”

CONDUCTED FOR

PROJECT SUBMITTED IN PARTIAL FULFILMENT

FOR THE

POST GRADUATE DIPLOMA IN INFORMATION

TECHNOLOGY MANAGEMENT

BY

Amplify Mindware, BVU-COE

Submitted By: Rajiv Ranjan
(PGD-ITM/08/086)

ACKNOWLEDGEMENT
1
Acknowledgement is the way to express our whole hearted
gratitude to the people.

This project is prepared on the basis of summer training,

period of two months. I have incurred debts to a great
number of people whom I must thank now. These were the
people who helped me in shaping the words for my ideas,
gave me directions at every mode of difficulties, always
standing beside me for the support.

I would like to take this golden opportunity to thank Karvy Stock

Broking Ltd. for giving me this experience and exposure to
Financial Services Industry.

I am highly indebted to Mr. Ravi Gaikwad, Distribution Head,

Karvy Stock Broking Ltd., Pune, who gave me this golden
opportunity to work with Karvy. I would also like to thank to Mr.
Vijay Suryavanshi, who guided and encouraged me during my
endeavors and Mr. Pramod Bode from whom I learnt how to
implement intricacies of marketing management in real life
situations.

My sincere thanks go to all Karvy staff members for their support

and co-operation for making this project successful.

RAJIV RANJAN
Bharti Vidyapeeth,
Pune

2
 CONTENTS

• Introduction and company profile

• Financial Products

• Project objective

• S W O T Analysis

• Problems faced by Sales Executives

• Conclusion

• Bibliography

3
 Introduction and Company Profile
Background:-

In 1982 a group of Hyderabad based practicing chartered accountants

started Karvy consultants limited with a capital of Rs. 1,50,000 offering

auditing and taxation services initially. Later, it forayed into the registrar and

share transfer activities and subsequently into financial services. All along,

Karvy’s strong work ethic and professional background leveraged with

information technology enabled it to deliver quality to the individual .A

decade of commitment, professional integrity and vision helped Karvy

achieve a leadership position in its field when it handled the largest number

of issues ever handled by anybody else in the history of Indian Stock Market

in a year. Thereafter, Karvy made inroads into a host of capital market

services,-

Corporate and Retail, which prove to be a sound business synergy.

Today, Karvy has access to millions of Indian shareholders, besides

companies, banks, financial institutions and regulatory agencies. Over the

past one and half decades, Karvy has evolved as a veritable link between

industry, finance and people. An ISO 9002 company, Karvy’s commitment to

quality and research reach has made it an integrated financial services

company.

4
Field of Competence:-

Karvy is one of India’s leading integrated financial services companies,

offering the individual customer and corporate a complete spectrum of

financial products and services. We enjoy the unique distinction of being the

leaders in every business segment that we are present in. Karvy Stock

Broking Ltd., today has presence of total 400 offices countrywide. Ranked

among the top five in terms of both volumes and brokerage earnings, it

provides opportunities for purchase and sale of securities through the

National Stock Exchange Ltd., and The Stock Exchange, Bombay, and trading

opportunities in both the cash and F&O (Futures & Options) segments. Karvy

is also a member of WDM (wholesale debt market) segment of the National

Stock Exchange Ltd.

Karvy Securities Ltd is among India’s prime distribution houses, ranked all-

India No.2 by “PRIME DATABASE” last year. Karvy Consultants Limited is

India’s largest registrar, having handled over 700 public/rights issues/offer for

sale/purchase etc., and one of the largest transfer agents worldwide, serving

16 million investors. It is also a Depository Participant with both the National

Securities Depository Limited and the Central Depository Services Limited.

One of the country’s top three depository participants, it provides service to

over 3 lac investors. Karvy Investor Services Ltd is a Category No.1 merchant

banker, registered with SEBI and is one of India’s leading investment banking

companies. Karvy’s strength is its reach, its network, its technological

competence, its service culture and, most importantly, a strong research

5
facility located at Mumbai and Hyderabad. Karvy’s reach is now recognized

by most opinion makers and provides a slew of publications and information.

Karvy sends e-mailers giving up-to-date market information thrice a day.

Karvy Bazaar Baatein, a printed newsletter, covers the market on a weekly

basis and is widely read by investors, both for reviewing the past one week

and for identifying future opportunities.

“Karvy the Finapolis, Your Personal Finance Advisor” is a unique magazine

that provides focused information on all financial options available to

individuals. Widely circulated with over 50,000 copies, it is recognized as a

comprehensive compendium of personal finance information.

In your city, Karvy will use its entire infrastructure and expertise in providing

the following services:

a) Stock Broking:

i) You can purchase or sell securities through Karvy Stock

Broking Ltd either at the NSE or at the BSE. If you wish to trade

in the F&O segment, this facility is also available for you.

ii) Karvy provides, through its reach and network, up-to-date

information on the state of the market. Its research and

recommendations on market opportunities available for short

6
 term, medium term and long term basis investment, are

respected widely.

iii) Though not a discount broker, Karvy’s brokerage charges

are competitive. They are computed on the philosophy that the

investor gets more value addition for the brokerage he pays than

from any other broker in the country.

iv) Karvy service culture is exemplary. Its record keeping,

information sharing with the client on the state of his account,

etc., are top class, because, in Karvy, we believe that the

customer deserves information, service and respect.

v) Karvy’s technological capabilities result in speedy

transactions, updated information and timely deliveries and

payment.

b) Depository Participant Services: The advantages of Karvy’s depository

participant services are:

i) A competitive fee structure;

ii) Facility of viewing your holdings through the internet;

iii) Excellent follow-up service with companies/registrars for

dematerialization of physical holdings and prompt updating of

DIS (delivery instruction slips)

7
 iv) Karvy is an integrated financial services organization,

providing varied facilities under one single roof. As a DP account

holder, you can enjoy access to its stock broking facility, advice

from our primary market distribution division on opportunities for

investment, or regarding borrowing and raising funds for personal

purposes, purchase of a car or a house.

b) Distribution Services: Karvy Securities Ltd., India’s premier

distributor, provides you services, facilities, advice and options for:

i) Purchase of shares and fixed income products in the

primary market;

ii) Purchase and redemption of mutual funds units;

iii) Purchase of and advice on tax saving instruments;

iv) Purchase of government and banking securities such as RBI

Relief Bonds;

v) Mobilizing funds against security of your shares;

vi) Organizing personal loans, housing loans and even car

loans;

8
It is pertinent to mention that we are a third party provider and not a direct

banker or broker. We scan the market to advise and assist you in getting the

best of the deals. Head office being Hyderabad Karvy has 400 odd branches

spread across the country. Karvy also has its establishment internationally in

the places like London, New York and Dubai. Karvy has a workforce currently

to the tune of roughly 4.500 employees and is expected to grow up to 10,000

employees by the end of 2005.All of which are white collared.

Karvy - The Evolution

9
KARVY PROVIDES SOLUTIONS FOR:

 IPO’s

 MUTUAL FUNDS

 INSURANCE

 BONDS AND FIXED DEPOSITS

 FINANCIAL PLANNING

 TAX PLANNING

 DEMAT A/C HANDLING

 DEPOSITORY SERVICES

 DEBT MARKET SERVICES

 UNDERWRITTING SERVICES

 BROKING SERVICES

 EQUITIES AND DERIVATIVES

 INVESTMENT BANKING

 BPO AND KPO SERVICES

 CORPORATE ADVISOR

 REGISTRAR AND TRANSFER AGENT

10
1. BONDS

In finance, a bond is a debt security, in which the authorized issuer

owes the holders a debt and is obliged to repay the principal and interest

(the coupon) at a later date, termed maturity. Other stipulations may also be

attached to the bond issue, such as the obligation for the issuer to provide

certain information to the bond holder, or limitations on the behavior of the

issuer. Bonds are generally issued for a fixed term longer than ten years. U.S.

Treasury securities issue debt with life of ten years or more, which is a bond.

New debt between one year and ten years is a "note” and new debt less than

a year is a "bill".

A bond is simply a loan, but in the form of a security, although

terminology used is rather different. The issuer is equivalent to the borrower,

the bond holder to the lender, and the coupon to the interest. Bonds enable

the issuer to finance long-term

Investments with external funds. Note that certificates of deposit

(CDs) or commercial paper are considered to be money market instruments

and not bonds.

In some nations, both terms bonds and notes are used irrespective of

the maturity. Market participants normally use the terms bonds for large

11
issues offered to a wide public and notes for smaller issues originally sold to a

limited number of investors. There are no clear demarcations. There are also

"bills" which usually denote fixed income securities with terms of three years

or less, from the issue date, to maturity. Bonds have the highest risk, notes

are the second highest risk, and bills have the least risk. This is due to a

statistical measure called duration, where lower durations mean less risk and

are associated with shorter term obligations.

Bonds and stocks are both securities, but the major difference

between the two is that stock-holders are the owners of the company (i.e.,

they have an equity stake), whereas bond-holders are lenders to the issuing

company. Another difference is that bonds usually have a defined term, or

maturity, after which the bond is redeemed, whereas stocks may be

outstanding indefinitely. An exception is a consol bond, which is a perpetuity

(i.e., bond with no maturity).

Issuing bonds:

Bonds are issued by public authorities, credit institutions, companies

and supranational institutions in the primary markets. The most common

process of issuing bonds is through underwriting. In underwriting, one or more

securities firms or banks, forming a syndicate, buy an entire issue of bonds

from an issuer and re-sell them to investors. Government bonds are typically

auctioned.

Types of bonds:

12
 Fixed rate bonds have a coupon that remains constant throughout

the life of the bond.

Floating rate notes (Fern’s) have a coupon that is linked to a money

market index, such as LIBOR or Euribor, for example three months USD LIBOR

+ 0.20%. The coupon is then reset periodically, normally every three months.

High yield bonds are bonds that are rated below investment grade

by the credit rating agencies. As these bonds are relatively risky, investors

expect to earn a higher yield. These bonds are also called junk bonds.

Zero coupon bonds do not pay any interest. They trade at a

substantial discount from par value. The bond holder receives the full principal

amount as well as value that have accrued on the redemption date.

Inflation linked bonds, in which the principal amount is indexed to

inflation. The interest rate is lower than for fixed rate bonds with a

comparable maturity. However, as the principal amount grows, the payments

increase with inflation. The government of the United Kingdom was the first to

issue inflation linked Gilts in the 1980s.

Other indexed bonds, for example equity linked notes and bonds

indexed on a business indicator (income, added value) or on a country's GDP.

Asset-backed securities are bonds whose interest and principal

payments are backed by underlying cash flows from other assets. Examples of

asset-backed securities are mortgage-backed securities (MBS's), collateralized

mortgage obligations (CMOs) and collateralized debt obligations (CDOs).

13
 Subordinated bonds are those that have a lower priority than other

bonds of the issuer in case of liquidation. In case of bankruptcy, there is a

hierarchy of creditors. First the liquidator is paid, then government taxes, etc.

The first bond holders in line to be paid are those holding what is called senior

bonds. After they have been paid, the subordinated bond holders are paid. As

a result, the risk is higher. Therefore, subordinated bonds usually have a lower

credit rating than senior bonds.

Perpetual bonds are also often called perpetuities. They have no

maturity date. The most famous of these are the UK Consoles, which are also

known as Treasury Annuities or Undated Treasuries. Some of these were

issued back in 1888 and still trade today.

Bearer bond is an official certificate issued without a named holder.

In other words, the person who has the paper certificate can claim the value

of the bond. Often they are registered by a number to prevent counterfeiting,

but may be traded like cash. Bearer bonds are very risky because they can be

lost or stolen.

Registered bond is a bond whose ownership (and any subsequent

purchaser) is recorded by the issuer, or by a transfer agent. It is the

alternative to a Bearer bond. Interest payments, and the principal upon

maturity, are sent to the registered owner.

Municipal bond is a bond issued by a state, U.S. Territory, city, local

government, or their agencies. Interest income received by holders of

municipal bonds is often exempt from the federal income tax and from the

14
income tax of the state in which they are issued, although municipal bonds

issued for certain purposes may not be tax exempt.

Book-entry bond is a bond that does not have a paper certificate. As

physically processing paper bonds and interest coupons became more

expensive, issuers (and banks that used to collect coupon interest for

depositors) have tried to discourage their use. Some book-entry bond issues

do not offer the option of a paper certificate, even to investors who prefer

them.

Lottery bond is a bond issued by a state, usually a European state.

Interest is paid like a traditional fixed rate bond, but the issuer will redeem

randomly selected individual bonds within the issue according to a schedule.

Some of these redemptions will be for a higher value than the face value of

the bond.

War bond is a bond issued by a country to fund a war

Investing in bonds:

Bonds are bought and traded mostly by institutions like pension

funds, insurance companies and banks. Most individuals who want to own

bonds do so through bond funds. Still, in the U.S., nearly ten percent of all

bonds outstanding are held directly by households.

As a rule, bond markets rise (while yields fall) when stock markets

fall. Thus bonds are generally viewed as safer investments than stocks, but

this perception is only partially correct. Bonds do suffer from less day-to-day

15
volatility than stocks, and bonds' interest payments are higher than dividend

payments that the same company would generally choose to pay to its

stockholders. Bonds are liquid — it is fairly easy to sell one's bond

investments, though not nearly as easy as it is to sell stocks — and the

certainty of a fixed interest payment twice per year is attractive. Bondholders

also enjoy a measure of legal protection: under the law of most countries, if a

company goes bankrupt, its bondholders will often receive some money back

(the recovery amount), whereas the company's stock often ends up

valueless. However, bonds can be risky:

Fixed rate bonds are subject to interest rate risk, meaning that their

market prices will decrease in value when the generally prevailing interest

rates rise. Since the payments are fixed, a decrease in the market price of

the bond means an increase in its yield.

Price changes in a bond immediately affect mutual funds that hold

these bonds. Many institutional investors have to "mark to market" their

trading books at the end of every day. If the value of the bonds held in a

trading portfolio has fallen over the day, the "mark to market" value of the

portfolio may also have fallen. This can be damaging for professional

investors such as banks, insurance companies, pension funds and asset

managers.

Bond prices can become volatile if one of the credit rating agencies like

Standard & Poor's or Moody's upgrades or downgrades the credit rating of

16
the issuer. A downgrade can cause the market price of the bond to fall. As

with interest rate risk, this risk does not affect the bond's interest payments,

but puts at risk the market price, which affects mutual funds holding these

bonds, and holders of individual bonds who may have to sell them.

A company's bondholders may lose much or all their money if the

company goes bankrupt. Under the laws of many countries (including the

United States and Canada), bondholders are in line to receive the proceeds of

the sale of the assets of a liquidated company ahead of some other creditors.

Bank lenders, deposit holders (in the case of a deposit taking institution such

as a bank) and trade creditors may take precedence.

There is no guarantee of how much money will remain to repay

bondholders. As an example, after an accounting scandal and a Chapter 11

bankruptcy at the giant telecommunications company WorldCom, in 2004 its

bondholders ended up being paid 35.7 cents on the dollar. In a bankruptcy

involving reorganization or recapitalization, as opposed to liquidation,

bondholders may end up having the value of their bonds reduced, often

through an exchange for a smaller number of newly issued bonds.

Some bonds are callable, meaning that even though the company has

agreed to make payments plus interest towards the debt for a certain period

of time, the company can choose to pay off the bond early. This creates

reinvestment risk, meaning the investor is forced to find a new place for his

money, and the investor might not be able to find good a deal, especially

because this usually happens when interest rates are falling.

17
2. STOCKS

What are stocks?

Quite simply, if you own a stock, you own a piece of the company. You

own a share of every bit of what the company owns even the CEO’s

limousine, if you please. What more, even while you are a part owner you

needn’t walk into the company headquarters even once.

Great? While all this sounds nice, it’s just a notional picture of stocks.

Rarely do stock investors get so much control. Even manage a free ride in the

limousine! So what’s the truth?

If those little valuable pieces of paper called share certificates carry

your name on them, you can say you have equity in the company whose

name appears on the top of the certificate. Equity is the part ownership of a

company in the form of its stocks. The number mentioned on each share

certificate tells you how many stocks of the company you own.

Then what are a company’s stocks?

World over, people who start a company usually do not have enough

money to kick-off. So they look elsewhere and try to rope in others to chip in.

They divide the entire capital that the company needs into a large number of

units of easily affordable amounts. For example, if a company requires a

capital of Rs 1 core, it may divide it into 10 laky units of Rs 10 each. Such

18
units are called stocks and Rs 10 is known as the par value of the stock.

Thus, anyone with a few hundred rupees to spare can invest in the company.

There are two obvious benefits of raising money this way. Firstly, it lets

an entrepreneur to think of starting a business even if she does not have a.

There are two obvious benefits of raising money this way. Firstly, it lets an

entrepreneur to think of starting a business even if she does not have all the

money required secondly, it allows small investors to participate in wealth

creation and benefit from an important economic activity.

There are two ways in which you make money with stocks

How can I make money from stocks?

The first, the now-and-thinly source, is through capital appreciation. A

week later if the stock price of the scrip you hold has doubled to Rs 20, by

selling it you have earned a return of Rs 10 as capital appreciation. You have

made money by a 100% appreciation in the stock’s price. Through this way

your fortunes will perpetually keep fluctuating. That’s because it depends on

the stock’s price, which is always on the move even if fluctuation are

incremental. Chances are:

The other way to make money through stocks is dividend. The

company whose stock you own may have made huge profits which it will

have to share with all stockholders. Such shared profits are called dividends.

Being ordinary shareholders, as we told you, you may or may not get

dividends, hence; this bit of earning through stocks is not assured.

19
 Dividends can be a good earning, more so because they are non-

taxable in your hands since now only companies have to pay tax on the

dividend they disburse. Shareholders sometimes prefer to do away with

dividends. This is specially so for small and fast-growing companies. Investors

in such companies feel it is better to plough back the earnings for growing

the business rather than distribute as dividends.

 Types of stocks:

We live in a class-ridden society. Stocks too have their two major

classes or types: ordinary and preference.

Ordinary stocks, sometimes also called equity stocks or common

stocks, are really for the general public without any bar.

Before we step further, let's clear one thing upfront. By equity we

mean stocks, right? And vice versa? We use equity and stocks

interchangeably. Equity refers to ordinary stocks. And that’s what concerns

us here because only ordinary stocks can be purchased by people like you

and traded on the stock exchanges. Stocks again refer to equity. Unless we

mention preferred

How nice! But did you get the catch when we said on `entitled’ and

`decides to give you’?

We live in a class-ridden society. Stocks too have their two major

classes or types: ordinary and preference.

20
 Ordinary stocks, sometimes also called equity stocks or common

stocks, are really for the general public without any bar. You, me and just

anyone can buy them (and proudly say we have a stake in the company).

Before we step further, let's clear one thing upfront. By equity we

mean stocks, right? And vice versa? We use equity and stocks

interchangeably. Equity refers to ordinary stocks. And that’s what concerns

us here because only ordinary stocks can be purchased by people like you

and traded on the stock exchanges. Stocks again refer to equity. Unless we

mention preferred stock, stock is always the other type meant for us. OK?

Individual investors can also acquire preference stocks, just that

companies in India haven’t bothered to offer them so far to the general

public.

Holding equity (savvy way of saying you own those pricey little share

certificates) entitles you to a share of the earnings and the assets of a

company. What that means is that if a company records profits for a year you

are entitled to a share of the profits. The share of the profits or earnings the

company is decides to give you is called dividend.

How nice! But did you get the catch when we said on `entitled’ and `decides

to give you’? Because what happens is that ordinary shareholders will only

get the dividend after everyone else, i.e. preference shareholders have

settled their share of the earnings. So, if the company chairman says no

dividends this year, you can't kidnap him till he comes out with your dividend

unless of course, you have no other way to earn infamy.

21
Preference shareholders are privileged guys. They get their share of the

earnings before the ordinary shareholders. In other words, preference stocks

will always have an assured dividend. Whether those shareholders actually

get paid depends on whether the company has enough resources to pay up.

If that was not enough, those privileged guys also have the "added"

advantage. All their missed dividends keep getting added while for ordinary

shareholders’ dividends once missed are missed forever! And when the

company does declare windfall profits, it will first pay the cumulative

dividends of the preference shareholders and then the ordinary shareholders.

22
 Sensex Rolling Return since its inception –

March 1979 to March 2008

Sens 1 Year 3 Year 5 Year 7 Year 10 Year 15 Year
No. Year End
ex Growth Growth Growth Growth Growth Growth
0 March-79 100
1 March-80 129 28.6%
2 March-81 173 34.9%
3 March-82 218 25.5% 29.6%
4 March-83 212 -2.8% 18.0%
5 March-84 245 16.0% 12.3% 19.66%
6 March-85 354 44.2% 17.6% 22.44%
7 March-86 574 62.2% 39.5% 27.05% 28.36%
8 March-87 510 -11.1% 27.7% 18.58% 21.77%
9 March-88 398 -21.9% 4.0% 13.50% 12.61%
10 March-89 714 79.1% 7.5% 23.81% 18.48% 21.72%
11 March-90 781 9.5% 15.2% 17.16% 20.52% 19.77%
12 March-91 1168 49.5% 43.1% 15.26% 24.97% 21.01%
13 March-92 4285 266.9% 81.8% 53.04% 42.80% 34.71%
14 March-93 2281 -46.8% 42.9% 41.76% 21.78% 26.84%
15 March-94 3779 65.7% 47.9% 39.57% 33.11% 31.45% 27.40%
16 March-95 3261 -13.7% -8.7% 33.09% 35.03% 24.87% 24.05%
17 March-96 3367 3.2% 13.9% 23.58% 24.81% 19.35% 21.86%
18 March-97 3361 -0.2% -3.8% -4.74% 23.18% 20.74% 20.02%
19 March-98 3893 15.8% 6.1% 11.29% 18.77% 25.60% 21.43%
20 March-99 3740 -3.9% 3.6% -0.21% -1.92% 18.02% 19.92%
21 March-00 5001 33.7% 14.2% 8.93% 11.87% 20.40% 19.31%
22 March-01 3604 -27.9% -2.5% 1.37% -0.67% 11.93% 13.03%
23 March-02 3469 -3.7% -2.5% 0.64% 0.89% -2.09% 13.63%
24 March-03 3049 -12.1% -15.2% -4.77% -1.41% 2.95% 14.53%
25 March-04 5591 83.4% 15.8% 8.37% 7.54% 3.99% 14.71%
26 March-05 6493 16.1% 23.2% 5.36% 7.58% 7.13% 15.16%
1128

27 March-06 0 73.7% 54.7% 25.63% 17.08% 12.85% 16.32%

1307

28 March-07 2 15.9% 32.7% 30.38% 14.71% 14.55% 7.72%

1564

29 March-08 4 19.7% 34.1% 38.69% 23.33% 14.92% 13.70%

Probability of

Loss 10/29 5/28 3/25 3/23 1/20 0/15

Maximum 266.90
23
Return % 81.80% 53.04% 42.80% 34.71% 27.40%
Minimum -
 Performance of different type of index of different sectorial.

SECTOR INDEX 2004 2005 2006 2007

BSE AUTO INDEX 11.94% 50.06% 29.65% 2.69%
BSE BANKEX

INDEX 32.97% 36.53% 39.43% 61.14%

BSE CAPITAL

GOODS INDEX 28.28% 93.65% 56.42% 117.32%

BSE CONSUMER

DURABLES INDEX 8.04% 114.51% 9.26% 94.63%

BSE FMCG INDEX -4.58% 55.57% 17.40% 19.94%
BSE

HEALTHCARE

INDEX 22.64% 1.83% 21.74% 16.52%

BSE IT

(TECHNOLOGY)

INDEX 23.47% 42.74% 40.87% -14.09%

BSE METAL

INDEX 14.40% 4.42% 39.38% 121.47%

BSE OIL & GAS

INDEX -0.43% 40.13% 40.10% 115.20%

BSE 200 INDEX 15.69% 33.80%24 39.58% 60.44%
1. MUTUAL FUNDS:

As it is defined above a Mutual Fund is a trust that pools the savings of

a number of investors who share a common financial goal. The money thus

collected is then invested in capital market instruments such as shares,

debentures and other securities. The income earned through these

investments and the capital appreciation realized is shared by its unit holders

in proportion to the number of units owned by them. Thus a Mutual Fund is

the most suitable investment for the common man as it offers an opportunity

to invest in a diversified, professionally managed basket of securities at a

relatively low cost. The flow chart below describes broadly the working of a

mutual fund.

25
ADVANTAGES OF MUTUAL FUNDS

The advantages of investing in a Mutual Fund are:

• A proper allocation across themes to a portfolio gives the right tilt or

balance to the investments.

• An investor can select his style of risk across three themes

(conservative, semi-aggressive, aggressive)

• Allows an investor to take advantage of various happenings of the

market like upward movement in only large-cap stocks or even in mid-

cap stocks or even some sectoral movements.

• An investor can easily benchmark his returns based on his exposure to

different themes

• Can get the best of every market cap of the markets

The graph indicates the growth of assets over the years.

26
 GROWTH IN ASSETS UNDER MANAGEMENT

The above graph has explained that how the growth of assets has shown the

upward trend while the same has been invested in mutual funds.

TYPES OF MUTUAL FUNDS: -

Mutual Funds have specific investment objectives such as growth of capital,

safety of principal current income or tax exempt income, one can select one

fund or any number of different funds to help one meets ones specific goals.

In general terms there are 7 types of mutual fund, that is:-

1. Open-End Funds

2. Close-End funds

3. Large Cap Funds

4. Mid-Cap Funds

27
 5. Equity Funds

6. Balanced Funds

7. Growth Funds

MUTUAL FUND SCHEME

Open Ended Schemes:-

Open-ended schemes do not have a fixed maturity period. Investors

can buy or sell units at NAV- related prices from and to the mutual fund on

any business day. These schemes have unlimited capitalization, open-ended

schemes do not have a fixed maturity, there is no cap on the amount you can

buy from the fund and the unit capital keep growing. These funds are not

generally listed on any exchange.

Open-ended schemes are preferred for their liquidity. Such funds can issue

and redeem units any time during the life of schemes. Hence unit capital of

open-ended funds can fluctuate on a daily basis. The advantages of open

ended schemes are: -

1. Any time exit option.

2. Any time enter option.

CLOSE ENDED SCHEMES:-

Close-ended schemes have fixed maturity periods. Investors can buy

into these funds during the period when these funds are open in the initial

28
issue. After that such scheme cannot issue new units except in case of bonus

or right issue. However after the initial issue you can buy or sell units of the

schemes on the stock exchange where they are listed. The market price of

the unit could vary from the NAV of the schemes due to demand and supply

factor.

HOW LONGTO KEEP INVESTMENT TO GET MAXIMUM RETURNS:-

Technically open-ended funds you can withdraw your investments even

within a week, but to get desired returns positive time frame is required are:

Funds Time Period

Equity Funds 3 Years (plus)
Balanced Funds 18 months to 3 Years
MIP’s 1 Year (plus)
Income Funds 6 months to 1 Year
Liquid Funds few days to 6 months

What returns can I expect if I keep my money for suggested time

frames:-

Funds Returns

Sector funds 22% to 25% p.a

Balance funds 15% to 18% p.a
MIP’s Pension Plans 12% to 15% p.a
Income Funds 10% to 12% p.a
Liquid Funds 7% to 9% p.a
The above-mentioned returns in the table are indicative and not assured. All

investments in MUTUAL FUNDS are securities and are subject to market risk

and the NAVs of the schemes may go up and down depending upon the

29
factors and forces affecting the security market including the fluctuations in

the internal rates .The past performance of the MUTUAL FUNDS is not

indicative of future performance.

THE RISK RETURNS GRAPHS FOR VARIOUS FUNDS:-

Sector Funds

R
E Equity Funds
T
U Balanced Funds
R
N Income Funds
S
Liquid Funds

RISKS

The above Graph shows the Risk and Returns generated by different Funds.

Liquid Funds are less Risky and also generate less Returns where as Sector

Funds are more Risky but generate more Returns by the example of above

two Funds it is clear that Risk and Returns are directly proportional to each

other. Other Funds like Equity Funds, Balanced Funds and Income Funds are

also gives the same percentage of Returns as the Risk involved.

 Comparison between Open ended and close Ended Schemes

Top 10 Open Ended - Equity: Diversified - Since Launch Return

30
 Return as

Fund NAV (Date) Returns (%) on

Tata Equity
42.31 (16-may) 71.04 5/16/2007
Opportunities
Sundaram Select
68.39 (16-may) 63.46 5/16/2007
Midcap
HSBC Equity 50.80 (16-may) 58.33 5/16/2007
Magnum Emerging
21.44 (16-may) 54.81 5/16/2007
Businesses
DSPML Top 100
40.59 (16-may) 52.54 5/16/2007
Equity
Kotak Opportunities 20.97 (16-may) 50.59 5/16/2007
Birla Mid Cap 45.02 (16-may) 50.02 5/16/2007
Prudential ICICI
43.83 (16-may) 49.70 5/16/2007
Dynamic
Nifty Junior BeES 51.31 (16-may) 48.27 5/16/2007
Sundaram India
21.84 (16-may) 47.95 5/16/2007
Leadership

Top 10 Closed Ended - Equity: Tax Planning - Since Launch Return

Return Return as

Fund NAV (Date) s (%) on

UTI MEPUS 29.09 (16-April) 48.44 4/16/2006

Birla Tax plan '98 147.26 (16-April) 38.73 4/16/2006

31
 Franklin India Tax shield
86.30 (16- April) 29.99 4/16/2006
'98
Franklin India Tax shield
90.02 (16- April) 26.93 4/16/2006
'97
Franklin India Tax shield
51.26 (16- April) 25.42 4/16/2006
'99

Sundaram Taxsaver '98 53.04 (16- April) 22.52 4/16/2006

Sundaram Taxsaver '97 28.63 (16- April) 21.86 4/16/2006

BoB ELSS '97 32.34 (14- April) 15.21 4/14/2006

Morgan Stanley Growth 37.96 (16- April) 13.93 4/16/2006

Standard Chartered
10.02 (15- April) 0.20 4/15/2006
Enterprise Equity

In above two tables we can see that when the market

was In boom returns was also good, if you compare open ended

scheme to close ended schemes you found that highest return given

by Tata Equity Opportunities which is an open ended scheme is

71.04% compare to highest return given in closed ended is given by

UTI MEPUS which is 48.44%.If you can see there is clear difference of

23% return between both schemes.

32
In case of marketing of mutual fund

First comes participants, involved are Mutual Fund

Company, client and third party service provider (i.e. Karvy stock broking

ltd.).

Secondly the cycle, which is its working procedure.

Basically the company come up with the different funds offer either it is

existing or new fund offer where the main aim is to sell it off to the target

consumer, then the role of third party service provide comes in the picture.

Where the broking house bridge the gap between the company and the

clients in promoting and selling of the different funds.

Thirdly comes the profit that means the benefit which goes to all the three

parties i.e. company, client and as well as broking house. The company is

benefited in the form of profit, what they get after selling of their different

Mutual fund products. Where the client is benefited in different ways.

1. By investing in mutual fund client can save the tax. There are various

companies mutual fund which come under ELSS (Equity Link Saving

33
 Scheme) where investing in such type of mutual fund, investor can

avail the tax exemption.

2. In other words we can say to get a quick money one should go for

mutual fund investment, this is because when the same money is there

in the bank then one should be going to get only nine percent of return

out of it but if the fund is invested in the good Mutual fund scheme

then on can expect at least 20% return in the worst case scenario and

maximum of return that the Mutual fund has given is around 65%.

Lastly the broking house gets benefited by getting the brokerage on

the number and the amount of funds and scheme sold.

Fourthly growth prospective of the Mutual Fund companies, it

has a wide future prospective, because always everyone wants to have tax

exemption for which people go for mutual fund investment, because of this

mutual fund company is growing. And apart from what is mention, by looking

the brand name of the company and its goodwill people normally go for

Mutual Fund investment. So it has to be seen that it has the wide future.

Lastly a question arise what is the challenge faced by the mutual

fund companies. The answers which we get are the competition between

different companies’ products and fund. This is how different companies

come up with the new funds and scheme which cater the customer’s

requirement, in this case companies try to provide as much benefit in their

plan which tackles the competition with one companies to another. And Karvy

stock broking ltd provides difference product of different companies to the

34
target audience, and here the role of Karvy becomes crucial to all

organization because it is none other than Karvy who is going to provide all

the product of different companies under one roof and in order to build its

own goodwill in the market Karvy promote and sell that companies product

which are really doing well in the market and has a good past track record of

more than five years.

In this regard we can take the example of SBI Mutual Fund.

Mutual fund of SBI:

3. SBI Mutual fund ( A partner for Life)

It is a joint venture between SBI and Societe Generale Assets Management.

Name of the Trustees Company: SBI Mutual Fund Trustee Company Private

Limited.

Dividend Policy: Dividend will be distributed from the available distributable

surplus after the deduction of the income distribution tax and the applicable

surcharge, if any. The Mutual Fund is not guaranteeing or assuring any

dividend.

Applicable NAV: For sale of magnums: in respect of valid applications

received up to 3 p.m. by the mutual fund at any designated centers along

with a local cherub or a demand draft payable at par at the place where the

application is received, the closing NAV of the day on which application is

received, the closing NAV of the day on which application is received shall be

applicable.

35
Daily Net Asset Value (NAV) Publication: The NAV will be declared on all

business days and will be published in 2 newspapers. NAV can also be visited

on www.sbimf.com and www.amfiindia.com

Tax treatment for the investors: as per the taxation law is force as at the date

of the document, and as per the provisions contained in the finance act,

2006. There are certain tax benefits that are available to the investors and to

the mutual fund.

It however noted that the tax benefits described in this document are as

available under the present taxation laws and are available subject to

fulfillment of stipulated conditions. The information given is included only for

general purpose regarding the law and practice currently in focus I n India

and the investors should also aware that the relevant fiscal rules or their

interpretation may change.

Few scheme of SBI Mutual Fund are:

Scheme name option minimum

amount

(Rs.)

1. Magnum Balance Fund. Growth & dividend 1000

2. Magnum Index Fund Growth & dividend 5000

3. Magnum Equity Fund Growth 2000

36
The strength point of the SBI Mutual Fund is firstly, the Fund Manager Mr.

Sanjay Sinha & Jayesh Shroff secondly, consistency grow rate along with the

good will of the company.

The expenses of the scheme are loading structure recurring expenses.

TOP MUTUAL FUNDS THE INVESTORS ARE INVESTING:

MUTUAL FUNDS
HDFC
60%
FRANKLIN
% INVESTMENT

50% TEMPLETON
40% SBI

30%
RELIANCE
20%
BIRLA
10%

0% SUNDARAM
1
MF ICICI

From the chart, we can see that most of people invest in SBI mutual funds as

it is giving good returns. Also some people regularly invest in HDFC &

FRANKLIN TEMPLETON due to its returns and its performance.

CONSIDERATION BEHIND INVESTMENT IN MF:

37
 HIGHER
RETURNS
14%
DIVIDENDS
HIGHER RETURNS
4%

DIVIDENDS

DIVERSIFICATION OF
RISK
DIVERSIFICATI
ON OF RISK
82%

From the chart, it is very clear that the basic consideration behind

investment in mutual funds is diversification of risk and also for getting

higher returns.

4. INSURANCE

A human life is also an income-generating asset. This asset also can be

lost through unexpectedly early death or made non-functional through

sickness & disabilities caused by accidents. Accidents may or may not

happen. Death will happen, but the timing is uncertain. If it happens around

the time of one's retirement, when it could be expected that the income will

cease, the person concerned could have made some other arrangements to

meet the continuing needs. But if it happens much earlier when the alternate

arrangements are not in place, insurance is necessary to help the

dependents.

38
 In case of a human being, he may have made arrangements for his

needs after his retirement. These would have been made on the basis of

some expectations like he may live for another 15 years, or that his children

will look after him. If any of these expectations do not come true, the original

arrangement would become inadequate and there could be difficulties.

Living too long can be as much a problem as dying too young. These

are risks, which need to be safeguarded against. Insurance takes care of it.

Need of Insurance

• To provide cash to meet various routine expenses of the family on

or immediately after the death of the income earner of the family.

• To prevent the family’s accustomed standard of living even after the

death of the breadwinner.

• To provide continuous flow of funds for the living spouse.

• To allocate income funds for the children’s education

• To provide a retirement income throughout old age.

• To provide a reliable savings plan for the future.

• To supplement income when earning power is reduced or eroded by

illness, accident or any handicap.

• To furnish surplus earnings for the investors should disaster strike.

Role of Life Insurance

39
Rule 1: Life insurance as “Investment”

Insurance is an attractive option for investment. While most people recognize

the risk hedging and tax saving potential of insurance, many are not aware of

its advantages as an investment option as well. Insurance products yield

more compared to regular investment options, and this is besides the added

incentives offered by insurers.

INSURANCE is a unique investment avenue that delivers sound returns in

addition to protection.

Role 2: Life insurance as “Risk cover”

First and foremost, insurance is about risk cover and protection – financial

protection, to be more precise – to help outlast life’s unpredictable losses.

Designed to safeguard against losses suffered on account of any unforeseen

event, insurance provides you with that unique sense of security that no

other form of investment provides. By buying life insurance, you buy peace of

mind and are prepared to face any financial demand that would hit the family

in case of an untimely demise.

Role 3: Life insurance as “Tax planning”

Insurance serves as an excellent tax saving mechanism too. The Government

of India has offered tax incentives to life insurance products in order to

facilitate the flow of funds into productive assets. Under Section 88 of Income

40
Tax Act 1961, an individual is entitled to a rebate of 20 per cent on the

annual premium payable on his/her life and life of his/her children or adult

children. The rebate is deductible from tax payable by the individual or a

Hindu Undivided Family. This rebate is can be availed up to a maximum of Rs

12,000 on payment of yearly premium of Rs 60,000. By paying Rs 60,000 a

year, you can buy anything upwards of Rs 10 laky in sum assured.

(Depending upon the age of the insured and term of the policy) This means

that you get an Rs 12,000 tax benefit. The rebate is deductible from the tax

payable by an individual or a Hindu Undivided Family.

Types of Insurance Plans:

1. TERM INSURANCE POLICY

A term insurance policy is a pure risk cover for a specified period of

time. What this means is that the sum assured is payable only if the

policyholder dies within the policy term. For instance, if a person buys Rest 2

laky policy for 15-years, his family is entitled to the money if he dies within

that 15-year period.

What if he survives the 15-year period? Well, then he is not entitled to any

payment; the insurance company keeps the entire premium paid during the

15-year period.

So, there is no element of savings or investment in such a policy. It is a 100

per cent risk cover. It simply means that a person pays a certain premium to

41
protect his family against his sudden death. He forfeits the amount if he

outlives the period of the policy. This explains why the Term Insurance Policy

comes at the lowest cost.

2. WHOLE LIFE POLICY

As the name suggests, a Whole Life Policy is an insurance cover against

death, irrespective of when it happens. Under this plan, the policyholder pays

regular premiums until his death, following which the money is handed over

to his family.

This policy, however, fails to address the additional needs of the

insured during his post-retirement years. It doesn't take into account a

person's increasing needs either. While the insured buys the policy at a

young age, his requirements increase over time. By the time he dies, the

value of the sum assured is too low to meet his family's needs. As a result of

these drawbacks, insurance firms now offer either a modified Whole Life

Policy or combine in with another type of policy.

3. ENDOWMENT POLICY

Combining risk cover with financial savings, an endowment policy is the

most popular policies in the world of life insurance. In an Endowment Policy,

the sum assured is payable even if the insured survives the policy term. If the

insured dies during the tenure of the policy, the insurance firm has to pay the

sum assured just as any other pure risk cover.

42
 A pure endowment policy is also a form of financial saving, whereby if

the person covered remains alive beyond the tenure of the policy; he gets

back the sum assured with some other investment benefits.

In addition to the basic policy, insurers offer various benefits such as

double endowment and marriage/ education endowment plans. The cost of

such a policy is slightly higher but worth its value.

4. MONEY BACK POLICY

These policies are structured to provide sums required as anticipated

expenses (marriage, education, etc) over a stipulated period of time. With

inflation becoming a big issue, companies have realized that sometimes the

money value of the policy is eroded. That is why with-profit policies are also

being introduced to offset some of the losses incurred on account of inflation.

A portion of the sum assured is payable at regular intervals. On survival the

remainder of the sum assured is payable. In case of death, the full sum

assured is payable to the insured. The premium is payable for a particular

period of time.

5. ANNUITIES AND PENSION

In an annuity, the insurer agrees to pay the insured a stipulated sum of

money periodically. The purpose of an annuity is to protect against risk as

well as provide money in the form of pension at regular intervals.

43
Over the years, insurers have added various features to basic insurance

policies in order to address specific needs of a cross section of people.

6. ULIPs:

ULIP is an acronym for Unit Linked Insurance Plan. ULIPs are distinct

from the more familiar ‘with profits’ policies sold for decades by the Life

Insurance Corporation. ‘With profits’ policies are called so because

investment gains (profits) are distributed to policyholders in the form of a

bonus announced every year. ULIPs also serve the same function of providing

insurance protection against death and provision of long-term savings, but

they are structured differently.

In ‘with profits’ policies, the insurance company credits the premium to

a common pool called the ‘life fund’ after setting aside funds for the risk

premium on life insurance and management expenses.

Every year, the insurer calculates how much has to be paid to settle

death and maturity claims. The surplus in the life fund left after meeting

these liabilities is credited to policyholders’ accounts in the form of a bonus.

In a ULIP too, the insurer deducts charges towards life insurance (mortality

charges), administration charges and fund management charges. The rest of

44
the premium is used to invest in a fund that invests money in stocks or

bonds. They number of units represents the policyholder’s share in the fund.

The value of the unit is determined by the total value of all the

investments made by the fund divided by the number of units. If the

insurance company offers a range of funds, the insured can direct the

company to invest in the fund of his choice. Insurers usually offer three

choices—an equity (growth) fund, balanced fund and a fund, which invests in

bonds.

In both ‘with profits’ policies as well as unit-linked policies, a large part

of the first year premium goes towards paying the agents’ commissions.

Working of ULIP:

The unit-linked plans work as under:

The premium paid by the client, less any charges to be deducted, is

used to buy units in the fund selected by the client at the day’s unit price. So,

more units are added to the client’s account each time he pays a premium. If

he unit price on that day is relatively high, the client gets less number of

units and if the unit price is relatively low, then he gets more number of

units.

45
In order to pay the regular monthly costs an equivalent numbers of units are

cancelled and are computed as cost to be deducted divided by unit price on

that day.

The value of the fund depends on the unit price, which in turn is determined

from the market value of the underlying assets as seen earlier. Thus, Fund

Value = Unit Price x Number of units

The ideal time to buy a unit-linked plan is when one can expect long-term

growth ahead. This especially so if one also believes that current market

values (stock valuations) are relatively low. BSLI has given superior returns

on all its investment funds.

46
 Our Objective

Our primary objective was to contact with the corporate people and get the

available market of the employees and the stakeholders to the services

offered by Karvy – The Finapolis. If we are able to convince the top

management about the desk keeping and the help to the people of the

organization we can easily get the support and publicity through referrals of

the customer then it would be very easy to get a better place in the market

than competitors. So, we found it better to contact the head of the

organization so that the lower management can easily be convinced.

• Intended Audience

The audience for this purpose was the top management who can

support us for giving us the customer base in their organization in the form of

tie-up.

47
 • Home work and preparation:

We should have all the tools and techniques available with us like, we

should be equipped with the corporate presentation of the company which

included the range of services offered by the company, its present market

conditions, brief idea about the companies with which it has got tie-up for

different products, brochures, pamphlets, recent issue of magazine of Karvy,

visiting cards. We had to know in advance what we are going to speak in

front of them and in what manner so that he can be influenced. So, we had

practiced it well at home and kept brief information about the several

services offered by Karvy to give them idea and create a platform for it to

stand before the other corporate bodies.

• Purpose:

The sole purpose of doing this type of planning was to acquire more

and more market through approaching the top management and get an edge

over the competitors

Products offered by Karvy

 Introduction to Private Client Group

The Karvy Private Client Group offers Customized Portfolio Management &

Investment Advisory Services on your existing Portfolio and Investible

Surplus.

48
 Our objective is to restructure your existing portfolio and optimize the

returns for the same by providing advice on Investments in various Financial

Instruments based on your Profile. We have a team of dedicated Advisors

who offer dedicated assistance and professional advice across a wide range

of Financial Instruments, which will be in line with your financial goals, your

current investment profile & and the returns expected in line with the risk

taken.

• Product Offerings:

 Stock Broking Services (Cash Market & Derivatives)

 Portfolio Management Services

 Mutual Fund Investments

 Demat Services

 Fixed Income (Bonds, RBI, Infrastructure, Tax Saving)

1.1 Risk Profiling and Asset Allocation

Your Investments will be customized based on the your

Investment Profile.

Aggressive Portfolios would be recommended for Investors with a High

Risk appetite with expectations of Higher Returns, Moderate Portfolio

49
Strategies for investors who wish to earn Moderate returns with a lesser risk,

Conservative Portfolio would be recommended to investors whose main

objective is to avoid Capital Erosion and don’t mind nominal returns but with

lesser risk.

1.2 Research - Our Core Competency

We keep our Clients abreast of the Markets by way of reports viz:

1 Daily Recommendations

2 Technical Recommendation:

Our Clients are kept abreast about the day-to-day volatilities in the

Stock Market through a Daily Report viz. Technical Recommendations. This

report is more suitable for Intra Day Traders since it is prepared with a short-

term horizon giving a Technical view on the market. This report is emailed on

a Daily basis to our clients.

3 Market Outlook:

Market Outlook is also a Daily Report, which would include News about

the market, stock specific news and related information. This report is

emailed on a daily basis to our clients.

4 In- depth Research Report

5 Quarterly Reports

Portfolio Tracking:

50
 A dedicated Portfolio Manager would be assigned to you for:

 Equity Portfolio Tracking

 Mutual Fund Portfolio Tracking

 Distribution of Mutual Funds,

 Tracking of Existing & New Mutual Fund Portfolios,

• No charges on Tracking of Mutual Fund Portfolios.

• Sending customers Daily and Weekly reports on the Mutual Fund

Market and performance of the Mutual Funds.

A dedicated Portfolio Manager is assigned to you who would understand

your Risk Profile, Returns expected and advise you the Financial

Instruments, which would suit your Profile as an Investor to attain the

maximum returns.

Gone are the days when one does not have to move one place for

generation of the business.

Today, it’s only sales on a comprehensive pattern that helps company

to grow and reach its aspired dreams. With a team of handful Sales executive

on which company relies for their sales, gets the company’s growth graph on

a positive note and bring it to different levels all together. This is the reason

why Sales and Marketing professionals are highly respected and also highly

paid all over the world.

51
 Now we shall discuss the sales procedures adopted by Karvy Stock

Broking Ltd in detail: This tool is the prime requirement of sales, without

which a sales person cannot even chalk a single strategy towards the sales

growth of the product.

KARVY is India’s #1 registrar with six different subsidiaries 100% owned by

the company, so as if there are any big deals or big clients getting registered

with the company the data reservoir automatically would record the name

and the name would get passed on to different companies as and when

required. This is what is supposed to be our main source of data collection.

The other forms of data collection were very interesting: the senior sales

person would get in touch with the other company’s Human Resource head

whose employees’ data were crucial from sales point of view to the company

requesting them for setting up Canopy as one of the branding and sales

technique of the company. Making the HR Head understand the benefits of

our various products to their employees and mainly my online trading

account which in return would generate lots of lead to follow up for the

marketing executives.

After having received the permission for setting up canopy company’s

sales trainees would get the questionnaire filled up by the clients who would

take the initiative to come by our canopy and ask for the various products

out of curiosity. It is then when very important role of any sales person

52
comes in picture for assessing that client rightly and sell him the exact

product which he is looking for.

Once the data bank is extracted using questionnaire, there takes place

consolidating of the database on factors being location, age group, annual

income, specific requirement if any and liabilities. Once this is done it is

handed over to the tele-calling sales team which then by their effective and

focused sales talk gets more valid and essential information about the

prospective client. The sales talk includes number of questions that are to be

asked to the customer for added information, like when it comes to the

product of online trading it is very important for a tele sales person to ask a

client about their trading habits, whether the client is already dealing with

any broker, whether he knows about our online trading facility, is he

comfortable executing trade on line, if the client is dealing with some other

broker, the tenure since when, knowing is important. They also have to fix up

the appointments for the sales executives provided the client is willing to

know about the product or buy the product.

It is they who understand more about the genuineness of the client

much earlier even before sales executive actually meet up with the client .Its

only with sales team to give good clients in the focus of business and

increase the productivity of the sales team

When it comes to online marketing the person concerned has to

extract the available E-mail ID’s from the data provided to him/her and send

53
mailers advertising our online account and also persuade them to revert back

so as to be able to make further growth in selling the product.

The mailer generally consists of lucrative price, heavy discounts, branding

material, luring language, and slogans about how the product is at the

cutting edge than the other competitors.

Sales Team:
Sales personal serves as the company’s personal link to the customer.

The sales representatives are the company to many of its customers, and it is

the sales representative who brings back to the company much needed

information about the customer. Therefore the company needs to give its

deepest thought to issues in sales force designing. Company must carefully

define the specific objectives they expect their sales force to achieve.

At Karvy Stock Broking Ltd. sales people do not initially try to sell a specific

product or solve a specific problem. Rather, they show a customer-prospect

how their company can help the customer improve their profitability. There

are certain thumb rules to be followed by sales executives to achieve their

targets.

 Sales representatives search for prospects or leads.

 Sales representatives decide how to allocate their time among

prospects and customers.

 Sales representatives skillfully communicate information about the

company’s product and services.

54
  Sales representatives know the art of sales approaching, presenting,

answering objections, and closing sales.

 Sales representatives provide various services to customers: consulting

on their problems, rendering technical assistance, and arranging

finance.

 Sales representatives conduct market research and intelligence work

and filling call report.

In KARVY the sales team comprises of five employees, which are

sales executive, two relationship managers and one sales head. They usually

work closely and keep in touch all the time. The appointment fixed up by the

tele sales team is then taken over by the sales force, and then further

dividing it among five or six executives they hit on to the sales call. They are

the one who bring in the actual business for the company. I accompanied

with the sales executives to couple of their calls, where in I learned how to

interact with the client so as to sale the product after convincing the client

the need and priority of having the product.

On the sales call the sales person has to first try and develop a

rapport with the client so as to be able to form a common ground for any kind

of a dialogue. The meeting should not have an absolute formal atmosphere,

which might make the client feel uneasy. Once a friendly atmosphere is

created the sales person tries to find out about the financial requirements

and investments habit of the customer in regards to sell the online product.

Brief introduction of the product is given to client and he asks about the

55
adopted trading pattern from the client. Then the sales person assesses the

client’s appetite for the product and convinces to buy the product by giving

the comparison based on theories and facts with the competitor. If the client

is convinced with the product he is given a demonstration as how the product

works like. If he has any query or any objections regarding the product they

are resolved. The work doesn’t end there even after selling the sales team

has to insure proper installing of the product and also the smooth

functioning.

The forms filled up by the client have to be dully filled up and

rechecked before sending it for further processing and generating of the

account, login ID and password from Hyderabad where our central processing

unit is stationed. The client receives the login id and password by mail within

ten working days. The login id and password are never sent together but

there is always a gap of 4 days. This practice is followed for security purpose.

Campaigning

Step 1: Data extraction-

We were given the coded data from the database of the company which was

procured from the TDS return filing that the company had made in previous

years. We extracted the necessary information from the data as Name of the

company, address, office number, contact person and his address along with

56
his contact number and e-mail-id. We tabulated it in excel book. Afterwards

the important work of getting them in touch was started. It involved mailing

and calling them individually through the contact number that we had found

in the database. The record involved directors, managing directors, trustees,

partners, proprietors, accounting managers, etc. We consulted Ravi sir –

Distribution head Karvy –Pune and he suggested to start from managing

directors and then directors and the sequence was supposed to move forth

subsequently.

Step 2: E-mail to all-

In the second step we mailed to all the persons our self designed one-pager

which included brief details our services and and value added services that

we offer.this step was very important because it lets know the concerned

person about the company in advance so that if we talk to him he has some

idea about Karvy’s services.

Step 3: Calling to all-

We started the calling. It was around 194 persons whom with we had to call

and get the appointment fixed with them. We went on calling and only few

positive responses were there that we got. Most of the time either the

number was wrong or there was no response or the person/organization was

not interested.

Step 4: Responses-

We had few positive responses where people heard our words that in what

services we are dealing. We let them know in a very pleasant manner in a

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format we were given and according to the customer like if he/she is

speaking in English, Hindi or Marathi we dealt with him/her in their language.

As we got the responses we were given the next appropriate time to

communicate with them. This way we found two appointments: the first one

with the Pune Peoples Co-Operative Bank which was at Baner. The second

one with Symbiosis Institute of Management Studies, Khadki.

Step 5: Meeting the appointments-

Our first meeting, meeting with Mr. Patwardhan, Branch Manager, Pune

Peoples Co- operative Bank, Baner, Pune. We went there with all the

preparations like with brochures, recent issue of Karvy’s monthly published

magazine and Karvy’s products presentations in my laptop. We had a

meeting with him where we told him about our products and also asked him

if we could place an investment desk in the company on a weekly or

fortnightly basis. He agreed with what we said but asked to contact CEO,

Pune Peoples Co-operative Bank because he does not have authority to allow

us to do that. He gave us his contact after several rounds of requests.

Contacting CEO through a trainee was not supposed to be appropriate. So we

provided the contact to our senior and he further progressed with that.

Response of Mr. Patwardhan: If the CEO gets convinced we not only can

talk to the employees of the organization but can also put our desk in its 40

more branches in Pune. They already have a tie-up with Max New York Life

Insurance for their insurance related solutions. They also have a tie-up with

Cosmos Bank for their PAN card services and they themselves have tax-

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planning and consultancy. Then we introduced him about our other services

like mutual funds, IPOs, Demat Services, Portfolio Management and many

more. He seemed convinced and provided the contact number and address

through which we can contact the CEO.

Our second meeting, meeting with Mr. Gaganjit Singh, Event manager,

SIMS (Symbiosis Institute of Management Studies): After a busy schedule he

gave us time to meet. We were prepared with all our materials. As we

reached there he gave us a warm welcome with a well gripped handshake

and introduced himself and we also introduced him, what our names are. He

took us in SIMS meeting room. As I reached there, I opened my laptop while

Sunil was introducing the company before him. I showed him the

presentation of Karvy’s competencies in different fields where it is working.

He was enthusiastic about listening what we are, what we offer and how

could we ease their financial problems and requirements. He was looking for

a tie-up with a financial services provider company and Karvy is like one stop

shop for all that. I said that it not only can help to the staff of the college but

also can be helpful for the students there. He further told us to put a desk in

the Business Seminar that was going to occur on 1 – 2 August 2009. It will

also give us publicity and we can introduce our services to the prospective

customers itself. Company is looking forward to get into the seminar. A

formal communication is asked to be given by Gaganjit Singh so that

company can further take steps according to that.

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Response of Mr. Gaganjit: He was very eager to get into the long lasting

relation with the company. The process is yet to be completed as any big

work takes time.

These were the appointments we got and worked upon.

Problems faced by Sales Executives:

In India there are several problems that sales executive face. Few of them

are here that was found during my project:

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1. Unawareness: Generally people are not aware about the investing

money even for there benefit therefore they do not know and do not

even show their interest to what a sales executive tries to make them

understand about the importance of putting money into some financial

product.

2. Illiteracy: Yet India is facing the problem of illiteracy therefore much

cannot be made understand to them that what and how these services

work and can benefit them.

3. Monetary Problem: India is among the fastest developing countries in

the world but it is facing the problem of less availability of money with

many of the citizens due to which they cannot avail what they can.

4. Local Language: Sometimes people like me who are unaware of local

language lack intimacy and it becomes bit difficult to win the trust of

the prospective customer.

5. Incomplete Knowledge: if the sales executives do not have complete

knowledge of the product they are dealing with then it becomes

difficult to solve the queries of the prospects.

6. Product of Multiple Companies tackling together: A person

seems to be unreliable if he is dealing simultaneously with the several

products that too of several companies(here mutual funds of SBI,

Reliance, Kotak etc.).

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7. All the products together: What should an executive sell?

Everything MF, insurance, Demat, PAN/TAN, and may more to tell. It

becomes difficult for him to achieve the target in the stipulated time.

SWOT ANALYSIS

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 The SWOT Analysis is a specific term which is used in the business for

finding out the Strength, Weakness, Opportunity, and Threat of the business

from other outside Competitors in the Market. Let us analyze them one by

one.

1. Strengths

• Build a strong pan-India network managed by experienced

professionals; build presence across both metros and Class A/B towns.

• Build full-service capabilities leveraging the network – offer the entire

gamut of financial services, backed by strong transaction processing

and high volume handling capability.

• Establish a high degree of ‘customer ownership’ and ‘top-of-mind’

recall in the local markets – ensure steady customer traffic.

• Amongst the Top 5 Stock Brokers (4.5% market share in India).

• Largest Independent Distributor for Financial Products in India.

2. Weakness

• Karvy deals in many types of financial product so they can’t give proper

required attention to the single customer service.

• They prefer mostly to the IT people and high Income group and give

less focus to the general public.

3. Opportunities

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 • In today’s economy Per capita income of India is increasing so more

people need professional advisers for their investments so Karvy can

get more customers and more profit using proper marketing.

• There are open economic all over the world so Karvy can open their

branches in foreign countries also.

• There are more knowledgeable and professional persons are available

in this field, so Karvy can use their skills and knowledge for the selling

and Marketing of his various types of Products and services.

4. Threat

• Karvy faces strong competition from other stock broking and consulting

companies.

• Now days there are more fluctuation in the securities market so people

can’t ready for investment easily because of some risk involved in the

Investment.

• The rules and regulation of IRDA and SEBI to stock broking companies

also affect the business of Karvy.

• Karvy also faces a competition from other sources of Investments like

Banks, Real estate etc.

FINDINGS AND SUGGESTIONS

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 During the Project I had found some important facts which had

occurred in the Karvy and out side in the Investment market.

Findings

• Corporate people are more formal and for a tie-up we need to contact

to top management.

• Once the top management is under confidence, company can be taken

under our clientele.

• Most of the people to whom I have met don’t want to Invest in the

Insurance because of the less return and long maturity period.

• People have preferred to Invest in Mutual funds rather than other

Investment Instruments.

• Karvy has been giving more attention to the IT people and not to the

general public who want to invest their money in the stock market.

• The people to whom I have met during cold calling, most of them were

not aware about different kind of beneficial Investments because of

lack of knowledge and awareness.

2 suggestions

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• Rather than contacting people here and there first of all customers

should be targeted and then an appropriate plan should be taken into

implementation.

• Karvy should take a suitable step towards awareness of people to the

Insurance and its importance in the life.

• Karvy should publish pamphlets about performance of different

Investments at regular time period so that It can generate the interest

of common public

• Karvy needs to give attention to the general public who want to invest

in the securities market.

• Karvy should arrange a seminar in proper time period for giving basic

knowledge to the needed public who want to Invest.

Conclusion
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Working as Karvy’s business developer I found that financial products are a

very good place to invest and one should try to aware himself about this. As

a person we need to learn and make people/organization understand what

these services are and how could all these help a person in increasing his

wealth.

Understanding the market and acting accordingly is the key to success in

financial world.

Bibliography
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www.karvy.com

www.sebi.in.gov

www.moneybhai.com

www.wikepedia.com

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